<PAGE>
As filed with the Securities and Exchange Commission on April 28, 1997
Registration No. 333-
333- -01
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-3
Registration Statement under the Securities Act of 1933
------------------------
INDEPENDENT BANK CORP. INDEPENDENT CAPITAL TRUST I
(Exact name of Registrant as specified (Exact name of Registrant as
in its charter) specified in its trust agreement)
MASSACHUSETTS DELAWARE
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
_________ _________
6022 6719
(Primary Standard Industrial (Primary Standard Industrial
Classification Code Number) Classification Code Number)
04-2870273 Applied for
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
------------------------
288 Union Street
Rockland, Massachusetts 02370
(617) 878-6100
(Address, including zip code, and telephone number, including area code, of
Registrants' principal executive offices)
------------------------
Richard J. Seaman
Chief Financial Officer
Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
(617) 878-6100
(Name, address, including zip code, and telephone number, including area code,
of agents for service)
------------------------
Copies to:
Norman B. Antin, Esq. Vince Pisano, Esq.
Elias, Matz, Tiernan & Herrick L.L.P. Skadden, Arps, Slate, Meagher & Flom LLP
734 15th Street, N.W. 919 Third Avenue
Washington, D.C. 20005 New York, New York 10022
------------------------
Approximate Date of Commencement of Proposed Sale to the Public:
As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================
Title of Each Class Amount Proposed Maximum Proposed Maximum Amount of
of Securities to be Offering Price Aggregate Registration
to be Registered Registered Per Unit(1) Offering Price(1) Fee(2)
<S> <C> <C> <C> <C>
===================================================================================================
Trust Preferred Securities of
Independent Capital Trust I ...... $28,750,000 100% $28,750,000 $8,713
- ---------------------------------------------------------------------------------------------------
Junior Subordinated Deferrable
Interest Debentures of Independent
Bank Corp.(2)..................... $28,750,000 100% $28,750,000 N/A
- ---------------------------------------------------------------------------------------------------
Independent Bank Corp. Guarantee
with respect to the Trust
Preferred Securities(3)........... N/A N/A N/A N/A
- ---------------------------------------------------------------------------------------------------
Total........................... $28,750,000(4) 100% $28,750,000(4) $8,713
===================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) No separate consideration will be received for the Junior Subordinated
Deferrable Interest Debentures of Independent Bank Corp. (the "Junior
Subordinated Debentures") distributed upon any liquidation of Independent
Capital Trust I.
(3) No separate consideration will be received for the Independent Bank Corp.
Guarantee.
(4) Such amount represents the liquidation amount of the Independent Capital
Trust I Trust Preferred Securities and the principal amount of Junior
Subordinated Debentures that may be distributed to holders of such Trust
Preferred Securities upon any liquidation of Independent Capital Trust I.
------------------------
The Registrants hereby amend this registration statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this registration
statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
==============================================================================
<PAGE>
SUBJECT TO COMPLETION DATED _______ __, 1997
PROSPECTUS
1,000,000 Trust Preferred Securities
Independent Capital Trust I
___% Cumulative Trust Preferred Securities
(Liquidation Amount $25 per Trust Preferred Security)
Fully and Unconditionally Guaranteed, as Described Herein, by
Independent Bank Corp.
The _____% Cumulative Trust Preferred Securities (the "Trust Preferred
Securities") offered hereby will represent undivided beneficial interests in
Independent Capital Trust I, a trust formed under the laws of the State of
Delaware (the "Trust"). Independent Bank Corp., a Massachusetts corporation (the
"Corporation" or "Independent"), will be the owner of all of the beneficial
interests represented by common securities of the Trust (the "Common
Securities," and together with the Trust Preferred Securities, the "Trust
Securities"). The Bank of New York is the Property Trustee of the Trust. The
Trust exists for the exclusive purposes of issuing the Trust Securities and
investing the proceeds thereof in the _____% Junior Subordinated Deferrable
Interest Debentures (the "Junior Subordinated Debentures"), to be issued by the
Corporation, and certain other limited activities described herein. The Junior
Subordinated Debentures are scheduled to mature on ______, 2027 which date may
be shortened (such date, as it may be shortened, the "Stated Maturity Date") to
a date not earlier than ___________, 2002 if certain conditions are met
(including the Corporation having received prior regulatory approval to do so if
then required under applicable capital guidelines or regulatory policies). The
Trust Preferred Securities will have a preference over the Common Securities
under certain circumstances with respect to cash distributions and amounts
payable on liquidation, redemption or otherwise. See "Description of Trust
Preferred Securities-Subordination of Common Securities."
(Continued on next page)
-----------
See "Risk Factors" beginning on page __ for a discussion of certain factors that
should be considered by prospective investors in evaluating an investment in the
Trust Preferred Securities.
-----------
THE SECURITIES OFFERED HEREBY ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK
AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
================================================================================
Price to Underwriting Proceeds to
Public Commission(1) Trust(2)(3)
- --------------------------------------------------------------------------------
Per Trust Preferred Security..... $25.00 (2) $
- --------------------------------------------------------------------------------
Total(4)......................... $25,000,000 (2) $
================================================================================
(1) The Corporation and the Trust have agreed to indemnify the Underwriters
against certain liabilities, including certain liabilities under the
Securities Act. See "Underwriting."
(2) In view of the fact that the proceeds of the sale of the Trust Preferred
Securities will be invested in the Junior Subordinated Debentures, the
Corporation, as issuer of the Junior Subordinated Debentures, has agreed to
pay the Underwriters, as compensation, $__ per Trust Preferred Security (or
$__________ in the aggregate). See "Underwriting."
(3) Before deducting estimated expenses of $_______ payable by the Corporation.
(4) The Trust has granted the Underwriters a 30-day option to purchase up to
150,000 additional Trust Preferred Securities on the same terms and
conditions set forth above solely to cover over-allotments, if any. If this
option is exercised in full, the total Price to Public will be $28,750,000
and Proceeds to Trust will be $______________. See "Underwriting."
----------
The Trust Preferred Securities are offered by the Underwriters, subject to
prior sale, when, as and if issued to and accepted by the Underwriters and
subject to approval of certain legal matters by counsel for the Underwriters and
to certain other conditions. The Underwriters reserve the right to withdraw,
cancel or modify such offer and to reject orders in whole or in part. It is
expected that delivery of the Trust Preferred Securities will be made through
the facilities of the Depository Trust Company ("DTC") in certificated form in
New York, New York on or about _____ __, 1997 against payment therefor in
immediately available funds.
----------
Legg Mason Wood Walker Piper Jaffray Inc.
Incorporated
The date of this Prospectus is ___________ __, 1997
<PAGE>
Information contained 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 jurisdiction in
which such offer, solicitation, or sale would be unlawful prior to the
registration or qualification under the securities laws of any such
jurisdiction.
<PAGE>
(Continued from the previous page)
The Trust Preferred Securities will be represented by one or more global
certificates registered in the name of The Depository Trust Company
("Depository" or "DTC") or its nominee. Beneficial interests in such Trust
Preferred Securities will be shown on, and transfers thereof will be effected
through, records maintained by DTC and its participants. Except as described
herein, Trust Preferred Securities in certificate form will not be issued in
exchange for global certificates. See "Book-Entry Issuance."
Application has been made to list the Trust Preferred Securities on the
Nasdaq National Market. Although the Underwriters have indicated an intention to
make a market in the Trust Preferred Securities, the Underwriters are not
obligated to make a market in the Trust Preferred Securities, and any market
making may be discontinued at any time at the sole discretion of the
Underwriters. There can be no assurance that a market will develop for the Trust
Preferred Securities. See "Risk Factors--Absence of Existing Public Market;
Market Prices" and "Underwriting."
Holders of the Trust Preferred Securities will be entitled to receive
cumulative cash distributions arising from the payment of interest on the Junior
Subordinated Debentures, accruing from the date of original issuance and payable
quarterly in arrears on the ____ day of March, June, September and December each
year, commencing _____________1997, at the annual rate of _____% of the
Liquidation Amount of $25 per Trust Preferred Security ("Distributions"). So
long as no Debenture Event of Default (as defined herein) has occurred and is
continuing, the Corporation will have the right to defer payments of interest on
the Junior Subordinated Debentures at any time and from time to time for a
period not exceeding 20 consecutive quarterly periods with respect to each
deferral period (each, an "Extension Period"), provided that no Extension Period
shall end on a date other than an Interest Payment Date (as defined herein) or
extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and the payment of all amounts then due, the Corporation may
elect to begin a new Extension Period, subject to the requirements set forth
herein. If and for so long as interest payments on the Junior Subordinated
Debentures are so deferred, Distributions on the Trust Preferred Securities also
will be deferred and the Corporation will not be permitted, subject to certain
exceptions described herein, to declare or pay any cash distributions with
respect to the Corporation's capital stock or to make any payment with respect
to debt securities of the Corporation that rank pari passu with or junior to the
Junior Subordinated Debentures. During an Extension Period, interest on the
Junior Subordinated Debentures will continue to accrue (and the amount of
Distributions to which holders of the Trust Preferred Securities are entitled
will continue to accumulate) at the rate of _____% per annum, compounded
quarterly, and holders of Trust Preferred Securities will be required to accrue
such deferred interest income for United States federal income tax purposes
prior to the receipt of the cash attributable to such income. See "Description
of Junior Subordinated Debentures--Option to Extend Interest Payment Date" and
"Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount."
2
<PAGE>
The Corporation will, through the Guarantee, the Trust Agreement, the
Junior Subordinated Debentures and the Indenture (each as defined herein), taken
together, fully, irrevocably and unconditionally guarantee all of the Trust's
obligations under the Trust Preferred Securities. See "Relationship Among the
Trust Preferred Securities, the Junior Subordinated Debentures and the
Guarantee--Full and Unconditional Guarantee." The Guarantee and the Common
Securities Guarantee will guarantee payments of Distributions and payments upon
liquidation of the Trust or redemption of the Trust Preferred Securities, but in
each case only to the extent that the Trust has funds on hand legally available
therefor and has failed to make such payments, as described herein. See
"Description of Guarantee." If the Corporation fails to make a required payment
on the Junior Subordinated Debentures, the Trust will not have sufficient funds
to make the related payments, including Distributions, on the Trust Preferred
Securities. The Guarantee and the Common Securities Guarantee will not cover any
such payment when the Trust does not have sufficient funds on hand legally
available therefor. In such event, a holder of Trust Preferred Securities may
institute a legal proceeding directly against the Corporation to enforce its
rights in respect of such payment. See "Description of Junior Subordinated
Debentures--Enforcement of Certain Rights by Holders of Trust Preferred
Securities." The obligations of the Corporation under the Guarantee, the Common
Securities Guarantee and the Junior Subordinated Debentures will be unsecured
and will rank subordinate and junior in right of payment to all Senior and
Subordinated Indebtedness (as defined in "Description of Junior Subordinated
Debentures--Subordination"). See "Risk Factors--Ranking of Subordinated
Obligations under the Guarantee and the Junior Subordinated Debentures." In
addition, because the Corporation is a holding company, the Junior Subordinated
Debentures, the Common Securities Guarantee and the Guarantee effectively will
be subordinated to all existing and future liabilities, including deposits, of
the Corporation's subsidiaries.
The Trust Preferred Securities will be subject to mandatory redemption in a
Like Amount (as defined herein), (i) in whole but not in part, on the Stated
Maturity Date upon repayment of the Junior Subordinated Debentures, (ii) in
whole but not in part, at any time prior to _______, 2002, contemporaneously
with the optional prepayment of the Junior Subordinated Debentures by the
Corporation, upon the occurrence and continuation of a Special Event (as defined
herein), and (iii) in whole or in part, on or after _____________, 2002,
contemporaneously with the optional prepayment by the Corporation of all or part
of the Junior Subordinated Debentures, in each case, at a redemption price equal
to the aggregate Liquidation Amount of such Trust Preferred Securities, plus
accumulated but unpaid Distributions thereon to the date of redemption (the
"Redemption Date"). See "Description of Trust Preferred Securities--Redemption."
The Corporation will have the right at any time to terminate the Trust and,
after satisfaction of liabilities of creditors of the Trust as required by
applicable law, to cause a Like Amount of the Junior Subordinated Debentures to
be distributed to the holders of the Trust Preferred Securities in liquidation
of the Trust, subject to (i) the Corporation having received an opinion of
counsel to the effect that such distribution will not be a taxable event to
holders of Trust Preferred Securities and (ii) the prior approval of the Board
of Governors of the Federal Reserve System (the "Federal Reserve") if then
required under applicable capital guidelines or policies of the Federal Reserve.
Unless the Junior Subordinated Debentures are distributed to the
3
<PAGE>
holders of the Trust Preferred Securities, in the event of a liquidation of the
Trust as described herein, after satisfaction of liabilities to creditors of the
Trust as required by applicable law, the holders of the Trust Securities
generally will be entitled to receive a Liquidation Amount of $25 per Trust
Preferred Security plus accumulated and unpaid Distributions thereon to the date
of payment. See "Description of Trust Preferred Securities--Liquidation of the
Trust and Distribution of Junior Subordinated Debentures."
-------------------
CERTAIN PERSONS PARTICIPATING IN THE OFFERING MADE HEREBY MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE
TRUST PREFERRED SECURITIES. SUCH TRANSACTIONS MAY INCLUDE STABILIZING, THE
PURCHASE OF TRUST PREFERRED SECURITIES TO COVER SYNDICATE SHORT POSITIONS AND
THE IMPOSITION OF PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING."
4
<PAGE>
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information with
the Commission. Such reports, proxy statements and other information may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at
the Commission's regional offices at 7 World Trade Center, 13th Floor, Suite
1300, New York, New York 10048 and Suite 1400, Citicorp Center, 500 West Madison
Street, Chicago, Illinois 60661. Copies of such material may also be obtained by
mail from the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. If available, such information
also may be accessed through the Commission's electronic data gathering,
analysis and retrieval system ("EDGAR") via electronic means, including the
Commission's home page on the Internet (http://www.sec.gov.). The Corporation's
common stock is traded on the Nasdaq National Market. Such reports, proxy
statements and other information concerning the Corporation also may be
inspected at the offices of the National Association of Securities Dealers,
Inc., 1735 K Street, N.W., Washington D.C. 20006.
No separate financial statements of the Trust have been included herein.
The Corporation and the Trust do not consider that such financial statements
would be material to holders of the Trust Preferred Securities because the Trust
is a newly-formed special purpose entity, has no operating history or
independent operations and is not engaged in and does not propose to engage in
any activity other than holding as trust assets the Junior Subordinated
Debentures, issuing the Trust Securities and engaging in incidental activities.
See "Independent Capital Trust I," "Description of Trust Preferred Securities,"
"Description of Junior Subordinated Debentures" and "Description of Guarantee."
In addition, the Corporation does not expect that the Trust will file reports,
proxy statements and other information under the Exchange Act with the
Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission are
incorporated into this Prospectus by reference:
1. The Corporation's Annual Report on Form 10-K for the year ended December
31, 1996.
All documents subsequently filed by the Corporation pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
the termination of the offering of the Trust Preferred Securities offered hereby
shall be deemed to be incorporated by reference into this Prospectus and to be a
part of this Prospectus from the date of filing of such document. Any statement
contained herein or in a document 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.
5
<PAGE>
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this Prospectus,
including the documents incorporated or deemed to be incorporated herein by
reference, as the same may be amended, supplemented or otherwise modified from
time to time. Statements contained in this Prospectus as to the contents of any
contract or other document referred to herein do not purport to be complete, and
where reference is made to the particular provisions of such contract or other
document, such provisions are qualified in all respects by reference to all of
the provisions of such contract or other document.
The Corporation will provide without charge to any person to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated by reference herein (other
than exhibits unless such exhibits are specifically incorporated by reference in
such documents). Requests for such documents should be directed to: Independent
Bank Corp., 288 Union Street, Rockland, Massachusetts 02370, Attention:
Shareholder Relations (telephone (617) 878-6100).
6
<PAGE>
SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus. As used herein, (i) the
"Indenture" means the Indenture, to be dated as of ______ __, 1997, as amended
and supplemented from time to time, between the Corporation and The Bank of New
York, as trustee (the "Debenture Trustee"), relating to the Junior Subordinated
Debentures, (ii) the "Trust Agreement" means the Amended and Restated
Declaration of Trust relating to the Trust among the Corporation, as Sponsor,
The Bank of New York, as Property Trustee (the "Property Trustee"), The Bank of
New York (Delaware), as Delaware Trustee (the "Delaware Trustee"), and the
Administrative Trustees named therein (collectively, with the Property Trustee
and Delaware Trustee, the "Issuer Trustees"), (iii) the "Guarantee" means the
Guarantee Agreement relating to the Trust Preferred Securities between the
Corporation and The Bank of New York, as Guarantee Trustee (the "Guarantee
Trustee") and (iv) the "Common Guarantee" means the Guarantee Agreement relating
to the Common Securities.
Independent Bank Corp.
The Corporation is the holding company of Rockland Trust Company (the
"Bank"), a Massachusetts trust company which was chartered in 1907. Independent
is headquartered in Rockland, Massachusetts and at December 31, 1996, the
Corporation had consolidated assets of $1.1 billion, deposits of $918.6 million
and stockholders' equity of $81.1 million.
Through the Bank, the Corporation offers a full range of commercial and
retail banking and trust services through its network of 33 banking offices,
seven commercial lending centers, and two trust and financial services offices
located in the Plymouth, Norfolk, and Bristol Counties of Southeastern
Massachusetts. The Corporation is the only locally based commercial bank in
Plymouth County. As a community focused commercial bank, the Corporation seeks
to service the needs of local customers in its market by developing long-term
deposit and lending relationships. As such, the Corporation has become a
prominent financial institution in Plymouth County, which represents the
majority of its market area. At June 30, 1996 (the most recent date for deposit
market share information), the Bank had approximately 16.6% of the deposits in
Plymouth County. That amount represents approximately 169% of market share of
its closest competitor. In addition, on the lending side of its business, the
Corporation has been the leading originator of residential mortgages in Plymouth
County for the last five years.
In its lending activities, the Bank has emphasized the origination of
residential and commercial loans within its primary market areas. At December
31, 1996, the Bank's gross loan portfolio consisted of 29.0% mortgage loans
collateralized by commercial real estate, 28.5% mortgage loans collateralized by
residential real estate, 17.9% commercial loans, 4.5% real estate construction
loans, and 20.1% consumer loans. The Bank stresses asset quality through its
emphasis on lending in its local markets where management is most qualified to
make educated underwriting decisions and the application of generally
conservative underwriting criteria.
7
<PAGE>
Independent Capital Trust I
The Trust is a statutory business trust formed under Delaware law upon
the filing of a certificate of trust with the Delaware Secretary of State.
The Trust's business and affairs are conducted by the Issuer Trustees: the
Property Trustee, the Delaware Trustee and the three individual
Administrative Trustees, who are officers of the Corporation. The Trust
exists for the exclusive purposes of (i) issuing and selling the Trust
Securities, (ii) using the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures issued by the Corporation and
(iii) engaging in only those other activities necessary, advisable or
incidental thereto. The Junior Subordinated Debentures will be the sole
assets of the Trust and, accordingly, payments under the Junior Subordinated
Debentures will be the sole revenue of the Trust. All of the Common
Securities will be owned by the Corporation. The Trust's principal offices
are located c/o The Bank of New York, 101 Barclay Street, New York, New York
10286 and its telephone number is (212) 815-5359.
The Offering
Trust Preferred Securities
Issuer............................. Independent Capital Trust I
Securities Offered................. 1,000,000 Trust Preferred Securities. The
Trust Preferred Securities represent
undivided beneficial interests in the
Trust's assets, which will consist solely of
the Junior Subordinated Debentures and
payments thereunder.
Distributions...................... The Distributions payable on each Trust
Preferred Security will be fixed at a rate
per annum of ___% of the Liquidation Amount
of $25 per Trust Preferred Security, will be
cumulative, will accrue from the date of
issuance of the Trust Preferred Securities,
and will be payable quarterly in arrears on
the __ day of March, June, September and
December of each year, commencing on ______
__, 1997 (subject to possible deferral as
described below). The amount of each
Distribution due with respect to the Trust
Preferred Securities will include amounts
accrued through the date the Distribution
payment is due. See "Description of the
Trust Preferred Securities--Distributions."
Extension Periods.................. So long as no Debenture Event of Default (as
defined herein) has occurred and is
continuing, the Corporation shall have the
right to defer the payment of interest on
the Junior Subordinated Debentures. During
an Extension Period, Distributions on Trust
Preferred Securities will be deferred. No
Extension Period will exceed 20 consecutive
quarterly periods, end on a date other than
an Interest Payment Date or extend beyond
the Stated Maturity Date. See "Description
of Junior Subordinated Debentures--Option to
Extend Interest Payment Date" and "Certain
Federal Income Tax Consequences--Interest
Income and Original Issue Discount."
8
<PAGE>
Maturity........................... The Junior Subordinated Debentures will
mature on ______, 2027 which date may be
shortened (such date, as it may be
shortened, the"Stated Maturity Date") to a
date not earlier than _____, 2002 if certain
conditions are met (including the
Corporation having received prior approval
of the Federal Reserve to do so if then
required under applicable capital guidelines
or policies of the Federal Reserve).
Ranking............................ The Trust Preferred Securities will rank
pari passu, and payments thereon will be
made pro rata, with the Common Securities
except as described under "Description of
Trust Preferred Securities - Subordination
of Common Securities." The Junior
Subordinated Debentures will rank pari passu
with all other junior subordinated
debentures (if any) issued by the
Corporation (the "Other Debentures"), which
are issued and sold (if at all) to other
trusts established by the Corporation (if
any), in each case similar to the Trust
("Other Trusts"), and will constitute
unsecured obligations of the Corporation and
will rank subordinate and junior in right of
payment to all current and future Senior and
Subordinated Indebtedness to the extent and
in the manner set forth in the Indenture.
See "Description of Junior Subordinated
Debentures." The Guarantee will rank pari
passu with all other guarantees (if any)
issued by the Corporation with respect to
trust preferred securities (if any) issued
by Other Trusts ("Other Guarantees") and
will constitute an unsecured obligation of
the Corporation and will rank subordinate
and junior in right of payment to all Senior
Indebtedness to the extent and in the manner
set forth in the Guarantee Agreement. See
"Description of Guarantee." In addition,
because the Corporation is a holding
company, the Junior Subordinated Debentures
and the Guarantee will be effectively
subordinated to all existing and future
liabilities of the Corporation's
subsidiaries, including the Bank's deposit
liabilities. See "Description of Junior
Subordinated Debentures--Subordination."
9
<PAGE>
Redemption......................... The Trust Preferred Securities will be
subject to mandatory redemption in a Like
Amount, (i) in whole but not in part, on the
Stated Maturity Date upon repayment of the
Junior Subordinated Debentures, (ii) in
whole but not in part, at any time prior to
_______, 2002, contemporaneously with the
optional prepayment of the Junior
Subordinated Debentures by the Corporation
upon the occurrence and continuation of a
Special Event (as defined herein) and (iii)
in whole or in part, on or after _______,
2002, contemporaneously with the optional
prepayment by the Corporation of all or part
of the Junior Subordinated Debentures, in
each case, at a redemption price equal to
the accrued and unpaid interest on the Trust
Preferred Securities so redeemed to the
Redemption Date, plus 100% of the principal
amount thereof. See "Description of Trust
Preferred Securities--Redemption" and
"Description of Junior Subordinated
Debentures--Special Event Prepayment."
Distribution of Junior
Subordinated Debentures............ The Corporation has the right at any time to
terminate the Trust and cause the Junior
Subordinated Debentures to be distributed to
holders of Trust Preferred Securities in
liquidation of the Trust, subject the
Corporation having received (i) an opinion
of counsel that such distribution will not
be a taxable event to the holders of the
Trust Preferred Securities and (ii) prior
approval of the Federal Reserve to do so if
then required under applicable capital
guidelines or policies of the Federal
Reserve. See "Description of the Trust
Preferred Securities--Distribution of Junior
Subordinated Debentures."
Absence of Market for the The Trust Preferred Securities will be a new
Trust Preferred issue of securities for which there
Securities......................... currently is no market. Although the
Underwriters have informed the Trust and the
Corporation that they currently intend to
make a market in the Trust Preferred
Securities, the Underwriters are not
obligated to do so, and any such market
making may be discontinued at any time
without notice. Accordingly, there can be no
assurance as to the development or liquidity
of any market for the Trust Preferred
Securities. The Trust and the Corporation
have applied for quotation of the Trust
Preferred Securities on the Nasdaq National
Market. See "Underwriting."
10
<PAGE>
Guarantee.......................... The Corporation has guaranteed the payment
of Distributions and payments on liquidation
or redemption of the Trust Preferred
Securities, but only in each case to the
extent of funds held by the Trust, as
described herein. The Corporation and the
Trust believe that, taken together, the
obligations of the Corporation under the
Guarantee, the Trust Agreement, the Junior
Subordinated Debentures and the Indenture
provide, in the aggregate, a full,
irrevocable and unconditional guaranty, on a
subordinated basis, of all of the
obligations of the Corporation relating to
the Trust Preferred Securities. The
obligations of the Corporation under the
Guarantee and the Trust Preferred Securities
are subordinate and junior in right of
payment to all current and future Senior and
Subordinated Indebtedness of the
Corporation. If the Trust has insufficient
funds to pay Distributions on the Trust
Preferred Securities (i.e., if the
Corporation has failed to make required
payments under the Junior Subordinated
Debentures), a holder of the Trust Preferred
Securities would have the right to institute
a legal proceeding directly against the
Corporation to enforce payment of such
Distributions to such holder. See
"Description of Junior Subordinated
Debentures--Enforcement of Certain Rights by
Holders of the Trust Preferred Securities,"
"Debenture Events of Default" and
"Description of Guarantee."
Limited Voting Rights.............. Holders of Trust Preferred Securities
generally will have limited voting rights
relating only to the modification of the
Trust Preferred Securities and the exercise
of the Trust's rights as holder of Junior
Subordinated Debentures. Holders of Trust
Preferred Securities will not be entitled to
vote to appoint, remove or replace, or to
increase or decrease the number of, the
Issuer Trustees, which voting rights are
vested exclusively in the holder of the
Common Securities except upon the occurrence
of certain events described herein.
Proposed Nasdaq National
Market Symbol......................
Use of Proceeds.................... All of the proceeds to the Trust from the
sale of the Trust Securities will be
invested by the Trust in the Junior
Subordinated Debentures. The Corporation
intends to use the net proceeds from the
sale of the Junior Subordinated Debentures
for general corporate purposes, including
contributions to the Bank to fund its
operations and the funding of repurchases of
the Corporation's common stock which may be
made from time to time. Initially, the net
proceeds may be used to make short-term
investments. See "Use of Proceeds."
Risk Factors....................... For a discussion of considerations relevant
to an investment in the Trust Preferred
Securities which should be carefully
considered by prospective investors, see
"Risk Factors."
11
<PAGE>
RISK FACTORS
Prospective purchasers of the Trust Preferred Securities should carefully
review the information contained elsewhere in this Prospectus and should
particularly consider the following matters. Information contained in this
Prospectus contains "forward-looking statements" which can be identified by the
use of forward-looking terminology such as "believes," "expects," "may," "will,"
"should," "projected," "contemplates" or "anticipates" or the negative thereof
or other variations thereon or comparable terminology. No assurance can be given
that the future results covered by the forward-looking statements will be
achieved. Certain of the following matters constitute cautionary statements
identifying important factors with respect to such forward-looking statements,
including certain risks and uncertainties, that could cause actual results to
vary materially from the future results covered in such forward-looking
statements. Other factors, such as the general state of the economy, could also
cause actual results to vary materially from the future results covered in such
forward-looking statements.
Ranking of Subordinated Obligations Under the Guarantee and the Junior
Subordinated Debentures; Limitations on Source of Funds
The obligations of the Corporation under the Guarantee issued by it for the
benefit of the holders of Trust Preferred Securities, as well as under the
Junior Subordinated Debentures, will be unsecured and will rank subordinate and
junior in right of payment to all current and future Senior and Subordinated
Indebtedness to the extent and in the manner set forth in the Guarantee and the
Indenture, respectively. No payment may be made of the principal of, or interest
on the Junior Subordinated Debentures, or in respect of any redemption,
retirement, purchase or other acquisition of any of the Junior Subordinated
Debentures, at any time when (i) there shall have occurred and be continuing a
default in any payment in respect of any Senior and Subordinated Indebtedness,
or there has been an acceleration of the maturity thereof because of a default,
or (ii) in the event of the acceleration of the maturity of the Junior
Subordinated Debentures, until payment has been made on all Senior and
Subordinated Indebtedness. At December 31, 1996, the Corporation had no Senior
Indebtedness outstanding. Because the Corporation is a holding company, the
right of the Corporation to participate in any distribution of assets of any
subsidiary upon such subsidiary's liquidation or reorganization or otherwise
(and thus the ability of holders of the Trust Preferred Securities to benefit
indirectly from such distribution) is subject to the prior claims of creditors
of that subsidiary (including depositors, in the case of the Bank), except to
the extent that the Corporation may itself be recognized as a creditor of that
subsidiary. At December 31, 1996, the subsidiary of the Corporation had total
liabilities (excluding liabilities owed to the Corporation) of $1.0 billion.
Accordingly, the Junior Subordinated Debentures effectively will be subordinated
to all existing and future liabilities of the Corporation's subsidiary and
holders of Junior Subordinated Debentures should look only to the assets of the
Corporation for payments on the Junior Subordinated Debentures. The Guarantee
will constitute an unsecured obligation of the Corporation and will rank
subordinate and junior in right of payment to all current and future Senior and
Subordinated Indebtedness in the same manner as the Junior Subordinated
Debentures. None of the Indenture, the Guarantee or the Trust Agreement places
any limitation on the amount of secured or unsecured debt, including Senior and
Subordinated
12
<PAGE>
Indebtedness, that may be incurred by the Corporation or any of its
subsidiaries. See "Description of Guarantee--Status of the Guarantee" and
"Description of Junior Subordinated Debentures-- "General" and
"--Subordination."
The ability of the Trust to pay amounts due on the Trust Preferred
Securities is solely dependent upon the Corporation making payments on the
Junior Subordinated Debentures as and when required.
The Corporation is a holding company and almost all of the operating assets
of the Corporation are owned by the Corporation's subsidiary. The Corporation
relies primarily on dividends from the Bank to pay dividends to its stockholders
and to meet its obligations for payment of its corporate expenses. There are
regulatory limitations on the payment of dividends directly or indirectly to the
Corporation from the Bank. As of December 31, 1996, under applicable banking
statutes and the Bank's dividend policy, the total capital available for payment
of dividends by the Bank to the Corporation was approximately $24 million.
However, federal and state bank regulatory agencies have the power to prohibit
any act, including the payment of dividends, if such act would reduce the Bank's
capital to a point that, in their opinion, would render the Bank
undercapitalized and thus constitute an unsafe or unsound banking practice. In
addition to restrictions on the payment of dividends, the Bank is subject to
certain restrictions imposed by federal law on any extensions of credit to, and
certain other transactions with, the Corporation and certain other affiliates,
and on investments in stock or other securities thereof. Such restrictions
prevent the Corporation and such other affiliates from borrowing from the Bank
unless the loans are secured by various types of collateral. Further, such
secured loans, other transactions and investments by the Bank are generally
limited in amount as to the Corporation and as to each of such other affiliates
to 10% of the Bank's capital and surplus and as to the Corporation and all of
such other affiliates to an aggregate of 20% of the Bank's capital and surplus.
Option to Extend Interest Payment Period; Tax Consequences; Market Price
Consequences
So long as no Debenture Event of Default (as defined herein) shall have
occurred and be continuing, the Corporation will have the right under the
Indenture to defer payments of interest on the Junior Subordinated Debentures at
any time or from time to time for a period not exceeding 20 consecutive
quarterly periods with respect to each Extension Period, provided that no
Extension Period shall end on a date other than an Interest Payment Date or
extend beyond the Stated Maturity Date. As a consequence of any such deferral,
quarterly Distributions on the Trust Securities by the Trust will be deferred
(and the amount of Distributions to which holders of the Trust Securities are
entitled will accumulate additional Distributions thereon at the rate of _____%
per annum, compounded quarterly) from the relevant payment date for such
Distributions during any such Extension Period. During the pendency of any
Extension Period, the Corporation generally will be prohibited from declaring or
paying dividends on the Corporation's capital stock or from making payments with
respect to debt securities which rank pari passu with or junior to the Junior
Subordinated Debentures. See "Description of Trust Preferred
Securities--Distributions."
13
<PAGE>
Prior to the termination of any such Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods, end on a
date other than an Interest Payment Date or to extend beyond the Stated Maturity
Date. Upon the termination of any Extension Period and the payment of all
interest then accrued and unpaid on the Junior Subordinated Debentures (together
with interest thereon at the annual rate of _____%, compounded quarterly, to the
extent permitted by applicable law), the Corporation may elect to begin a new
Extension Period, subject to the above requirements. There is no limitation on
the number of times that the Corporation may elect to begin an Extension Period.
See "Description of Trust Preferred Securities--Distributions" and "Description
of Junior Subordinated Debentures--Option to Extend Interest Payment Date."
The Corporation has no current plan to exercise its right to defer payments
of interest on the Junior Subordinated Debentures. However, should the
Corporation exercise its right to defer payments of interest on the Junior
Subordinated Debentures, each holder of Trust Preferred Securities will be
required to accrue income (in the form of original issue discount ("OID")) in
respect of the deferred stated interest allocable to its Trust Securities for
United States federal income tax purposes, which will be allocated but not
distributed to holders of Trust Securities. As a result, each holder of Trust
Preferred Securities will recognize income for United States federal income tax
purposes in advance of the receipt of cash and will not receive the cash related
to such income from the Trust if the holder disposes of the Trust Preferred
Securities prior to the record date for the payment of Distributions thereafter.
See "Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount" and "--Sales of Trust Preferred Securities."
Should the Corporation elect to exercise its right to defer payments of
interest on the Junior Subordinated Debentures in the future, the market price
of the Trust Preferred Securities is likely to be affected. A holder that
disposes of its Trust Preferred Securities during an Extension Period,
therefore, might not receive the same return on its investment as a holder that
continues to hold its Trust Preferred Securities. In addition, the mere
existence of the Corporation's right to defer payments of interest on the Junior
Subordinated Debentures may cause the market price of the Trust Preferred
Securities to be more volatile than the market prices of other securities that
are not subject to such deferrals.
Special Event Redemption
Upon the occurrence and continuation of a Special Event (defined as a Tax
Event, an Investment Company Event or a Regulatory Capital Event (in each case
as defined under "Description of Junior Subordinated Debentures--Special Event
Prepayment")) (whether occurring before or after _____, 2002) the Corporation
will have the right to prepay the Junior Subordinated Debentures in whole (but
not in part) at 100% of the principal amount together with accrued but unpaid
interest to the date fixed for redemption within 90 days following the
occurrence of such Special Event and therefore cause a mandatory redemption of
the Trust Preferred Securities at a redemption price equal to the aggregate
Liquidation Amount of such
14
<PAGE>
Trust Preferred Securities, plus accrued and unpaid interest thereon. The
exercise of such right is subject to the Corporation having received any
required regulatory approval. See "Description of Trust Preferred
Securities--Redemption."
Proposed Tax Legislation
On February 6, 1997, as part of President Clinton's Fiscal 1998 Budget
Proposal, the United States Treasury Department proposed legislation that would,
among other things, deny an issuer a deduction for United States federal income
tax purposes for the payment of interest on instruments with characteristics
similar to the Junior Subordinated Debentures. If the proposed legislation were
enacted in its current form, it is not expected to apply to the Junior
Subordinated Debentures since the proposed effective date for this provision is
the date of first committee action. There can be no assurances, however, that
the proposed legislation, if enacted, or similar legislation enacted after the
date hereof would not adversely affect the tax treatment of the Junior
Subordinated Debentures, resulting in a Tax Event, which would permit the
Corporation, upon the approval of the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve, to cause a
redemption of the Trust Preferred Securities by electing to prepay the Junior
Subordinated Debentures. See "Description of Trust Preferred
Securities--Redemption" and "Description of Junior Subordinated
Debentures--Special Event Prepayment." See also "Certain Federal Income Tax
Consequences - Proposed Tax Legislation."
Liquidation Distribution of Junior Subordinated Debentures
The Corporation will have the right at any time to terminate the Trust and,
after satisfaction of liabilities to creditors of the Trust as required by
applicable law, to cause the Junior Subordinated Debentures to be distributed to
the holders of the Trust Preferred Securities in liquidation of the Trust. Such
right is subject to (i) the Corporation having received an opinion of counsel to
the effect that such distribution will not be a taxable event to the holders of
the Trust Preferred Securities and (ii) the prior approval of the Federal
Reserve to do so if then required under applicable capital guidelines or
policies of the Federal Reserve and the receipt of any other required regulatory
approval. Under current United States federal income tax law, a distribution of
Junior Subordinated Debentures upon the dissolution of the Trust would not be a
taxable event to holders of the Trust Preferred Securities. Upon the occurrence
of a Special Event, a dissolution of the Trust in which holders of the Trust
Preferred Securities receive cash would be a taxable event to such holders. See
"Certain Federal Income Tax Considerations--Receipt of Junior Subordinated
Debentures or Cash Upon Liquidation of the Trust."
Shortening of Stated Maturity of Junior Subordinated Debentures
The Corporation will have the right at any time to shorten the maturity of
the Junior Subordinated Debentures to a date not earlier than five years from
the date of issuance and thereby cause the Trust Preferred Securities to be
redeemed on such earlier date. The exercise of such right is subject to the
Corporation having received prior approval of the Federal Reserve
15
<PAGE>
if then required under applicable capital guidelines or policies of the Federal
Reserve. See "Description of Junior Subordinated Debentures--Redemption."
Possible Adverse Effect on Market Prices
There can be no assurance as to the market prices for the Trust Preferred
Securities or the Junior Subordinated Debentures that may be distributed in
exchange for Trust Preferred Securities if a termination of the Trust were to
occur. Accordingly, the Trust Preferred Securities or the Junior Subordinated
Debentures may trade at a discount from the price that the investor paid to
purchase the Trust Preferred Securities offered hereby. Because holders of Trust
Preferred Securities may receive Junior Subordinated Debentures in liquidation
of the Trust and because Distributions are otherwise limited to payments on the
Junior Subordinated Debentures, prospective purchasers of the Trust Preferred
Securities are also making an investment decision with regard to the Junior
Subordinated Debentures and should carefully review all the information
regarding the Junior Subordinated Debentures contained herein. See "Description
of Junior Subordinated Debentures."
Rights Under the Guarantee
The Guarantee will guarantee to the holders of the Trust Preferred
Securities the following payments, to the extent not paid by or on behalf of the
Trust: (i) any accumulated and unpaid Distributions required to be paid on the
Trust Preferred Securities, to the extent that the Trust has funds on hand
legally available therefor at such time, (ii) the redemption price with respect
to the Trust Preferred Securities called for redemption, to the extent that the
Trust has funds on hand legally available therefor at such time and (iii) upon a
voluntary or involuntary termination, winding up or liquidation of the Trust
(unless the Junior Subordinated Debentures are distributed to holders of the
Trust Preferred Securities), the lesser of (a) the aggregate of the Liquidation
Amount and all accumulated and unpaid Distributions to the date of payment, to
the extent that the Trust has funds on hand legally available therefor at such
time, and (b) the amount of assets of the Trust remaining available for
distribution to holders of the Trust Preferred Securities at such time, after
the satisfaction of liabilities to creditors of the Trust as provided by
applicable law.
The holders of a majority in Liquidation Amount of the Trust Preferred
Securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Guarantee or to direct the exercise of any trust power conferred
upon the Guarantee Trustee under the Guarantee. Any holder of the Trust
Preferred Securities may institute a legal proceeding directly against the
Corporation to enforce its rights under the Guarantee without first instituting
a legal proceeding against the Trust, the Guarantee Trustee or any other person
or entity. If the Corporation defaults on its obligation to pay amounts payable
under the Junior Subordinated Debentures, the Trust will not have sufficient
funds for the payment of Distributions or amounts payable on redemption of the
Trust Preferred Securities or otherwise, and, in such event, holders of the
Trust Preferred Securities will not be able to rely upon the Guarantee for
payment of such amounts. Instead, in the event a Debenture
16
<PAGE>
Event of Default shall have occurred and be continuing and such event is
attributable to the failure of the Corporation to pay the principal or interest
(including Additional Sums, as defined below, if any), on the Junior
Subordinated Debentures on the payment date on which such payment is due and
payable, then a holder of Trust Preferred Securities may institute a legal
proceeding directly against the Corporation for enforcement of payment to such
holder of the aggregate Liquidation Amount of the Trust Preferred Securities of
such holder (a "Direct Action"). Notwithstanding any payments made to a holder
of Trust Preferred Securities by the Corporation in connection with a Direct
Action, the Corporation shall remain obligated to pay the principal and interest
(including Additional Sums, if any), on the Junior Subordinated Debentures, and
the Corporation shall be subrogated to the rights of the holder of such Trust
Preferred Securities with respect to payments on the Trust Preferred Securities
to the extent of any payments made by the Corporation to such holder in any
Direct Action. Except as described herein, holders of Trust Preferred Securities
will not be able to exercise directly any other remedy available to the holders
of the Junior Subordinated Debentures or to assert directly any other rights in
respect of the Junior Subordinated Debentures. See "Description of Junior
Subordinated Debentures--Enforcement of Certain Rights by Holders of Trust
Preferred Securities," "--Debenture Events of Default" and "Description of
Guarantee." The Trust Agreement will provide that each holder of Trust Preferred
Securities by acceptance thereof agrees to the provisions of the Indenture. The
Bank of New York will act as Guarantee Trustee and will hold the Guarantee for
the benefit of the holders of the Trust Preferred Securities. The Bank of New
York will also act as Property Trustee and as Debenture Trustee under the
Indenture. The Bank of New York (Delaware) will act as Delaware Trustee under
the Trust Agreement.
Limited Covenants
The covenants in the Indenture are limited, and there are no covenants
relating to the Corporation in the Trust Agreement. As a result, neither the
Indenture nor the Trust Agreement protects holders of Junior Subordinated
Debentures, or Trust Preferred Securities, respectively, in the event of a
material adverse change in the Corporation or the Corporation's financial
condition or results of operations or limits the ability of the Corporation or
any subsidiary to incur additional indebtedness. Therefore, the provisions of
these governing instruments should not be considered a significant factor in
evaluating whether the Corporation will be able to comply with its obligations
under the Junior Subordinated Debentures or the Guarantee.
Limited Voting Rights
Holders of Trust Preferred Securities generally will have limited voting
rights relating only to the modification of the Trust Preferred Securities and
the exercise of the Trust's rights as holder of Junior Subordinated Debentures.
Holders of Trust Preferred Securities will not be entitled to vote to appoint,
remove or replace, or to increase or decrease the number of, the Issuer
Trustees, which voting rights are vested exclusively in the holder of the Common
Securities except upon the occurrence of certain events described herein. The
Property Trustee, the Administrative Trustees and the Corporation may amend the
Trust Agreement without the consent of holders of Trust Preferred Securities to
ensure that the Trust will be classified for United
17
<PAGE>
States federal income tax purposes as a grantor trust. Holders of Trust
Preferred Securities will have no voting rights with respect to any matters
submitted to a vote of the Corporation's stockholders. See "Description of Trust
Preferred Securities--Voting Rights; Amendment of the Trust Agreement" and
"--Removal of Issuer Trustees."
Absence of Existing Public Market
There is no existing market for the Trust Preferred Securities. Application
has been made to list the Trust Preferred Securities on the Nasdaq National
Market. There can be no assurance that an active and liquid trading market for
the Trust Preferred Securities will develop or that a continued listing of the
Trust Preferred Securities will be available on the Nasdaq National Market.
Although the Underwriters have informed the Trust and the Corporation that the
Underwriters intend to make a market in the Trust Preferred Securities offered
hereby, the Underwriters are not obligated to do so and any such market-making
activity may be terminated at any time without notice to the holders of the
Trust Preferred Securities. Future trading prices of the Trust Preferred
Securities will depend on many factors including, among other things, prevailing
interest rates, the operating results and financial condition of the
Corporation, and the market for similar securities.
18
<PAGE>
Trading Characteristics of the Trust Preferred Securities
The Trust Preferred Securities may trade at a price that does not fully
reflect the value of accrued but unpaid interest with respect to the underlying
Junior Subordinated Debentures. A holder who uses the accrual method of
accounting for tax purposes (and a cash method holder, if the Junior
Subordinated Debentures are deemed to have been issued with OID) and who
disposes of its Trust Preferred Securities between record dates for payments of
distributions thereon will be required to include accrued but unpaid interest on
the Junior Subordinated Debentures through the date of disposition in income as
ordinary income (i.e., interest or, possibly, OID), and to add such amount to
its adjusted tax basis in its share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than the
holder's adjusted tax basis (which will include all accrued but unpaid
interest), a holder will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes. See "Certain Federal Income Tax
Considerations--Interest Income and Original Issue Discount" and "--Sales of
Trust Preferred Securities."
INDEPENDENT BANK CORP.
The Corporation is the holding company of the Bank, a Massachusetts trust
company which was chartered in 1907. Independent is headquartered in Rockland,
Massachusetts and at December 31, 1996, the Corporation had consolidated assets
of $1.1 billion, deposits of $918.6 million and stockholder's equity of $81.1
million.
Through the Bank, the Corporation provides a full range of commercial and
retail banking and trust services through its network of 33 banking offices,
seven commercial lending centers, and two trust and financial services offices
located in the Plymouth, Norfolk, and Bristol Counties of Southeastern
Massachusetts. The Corporation is the only locally based commercial bank in
Plymouth County. As a community focused commercial bank, the Corporation seeks
to service the needs of local customers in its market by developing long-term
deposit and lending relationships. As such, the Corporation has become a
prominent financial institution in Plymouth County, which represents the
majority of its market area. At June 30, 1996 (the most recent date for deposit
market share information), the Bank had approximately 16.6% of the deposits in
Plymouth County. That amount represents approximately 169% of market share of
its closest competitor. In addition, on the lending side of its business, the
Corporation has been the leading originator of residential mortgages in Plymouth
County for the last five years.
In its lending activities, the Bank has emphasized the origination of
residential and commercial loans within its primary market areas. At December
31, 1996, the Bank's gross loan portfolio consisted of 29.0% mortgage loans
collateralized by commercial real estate, 28.5% mortgage loans collateralized by
residential real estate, 17.9% commercial loans, 4.5% real estate construction
loans, and 20.1% consumer loans. The Bank stresses asset quality through its
emphasis on lending in its local markets where management is most qualified to
make educated underwriting decisions and the application of generally
conservative underwriting criteria.
19
<PAGE>
The Corporation is registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended ("BHCA"), and as such is subject to
regulation by the Federal Reserve. The Bank is subject to regulation and
examination by the Commissioner of Banks of the Commonwealth of Massachusetts
(the "Commissioner") and the Federal Deposit Insurance Corporation ("FDIC"). The
majority of Rockland's deposit accounts are insured to the maximum extent
permitted by law by the Bank Insurance Fund ("BIF") which is administered by the
FDIC. In 1994, the Bank purchased the deposits of three branches of a failed
savings and loan association from the Resolution Trust Corporation. These
deposits are insured to the maximum extent permitted by law by the Savings
Association Insurance Fund ("SAIF").
The Corporation currently is in compliance with all regulatory capital
requirements. At December 31, 1996, the Corporation had Tier 1 capital and total
capital equal to 10.89% and 12.15% of total risk-adjusted assets, respectively,
and Tier 1 leverage capital equal to 7.35% of total assets. The Corporation
reported net income of $11.6 million, or $0.79 per share, for the year ended
December 31, 1996, which equated to a 15.2% return of average equity and 1.13%
return on average assets.
The principal executive offices of the Corporation are located at 288 Union
Street, Rockland, Massachusetts 02370, and its telephone number is (617)
878-6100.
20
<PAGE>
USE OF PROCEEDS
The proceeds to the Trust from the offering of the Trust Preferred
Securities will be $25,000,000. All of the proceeds from the sale of the Trust
Preferred Securities and the Common Securities will be invested by the Trust in
the Junior Subordinated Debentures. The estimated net proceeds of approximately
$__________ will be available to the Corporation for general corporate purposes,
including contributions to the Bank to fund its operations, the funding of one
or more future acquisitions and the funding of repurchases of the Corporation's
common stock which may be made from time to time. From time to time, the
Corporation investigates and holds discussions and negotiations in connection
with possible transactions with other financial institutions and holding
companies thereof. As of the date of this Prospectus, the Corporation has not
entered into any agreements or understandings with respect to any such
acquisitions or any other material transactions of the type referred to above.
Initially, the net proceeds may be used to make short-term investments.
The Trust Preferred Securities will be eligible to qualify as Tier 1
Capital under the capital guidelines of the Federal Reserve, provided that under
current Federal Reserve guidelines no more than 25% of the Corporation's Tier 1
Capital may comprise Trust Preferred Securities and other capital securities and
cumulative preferred stock of the Corporation.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges of
the Corporation on a consolidated basis for the respective periods indicated.
<TABLE>
<CAPTION>
Year Ended December 31,
---------------------------------------------------------------
1996 1995 1994 1993 1992
---------- ---------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Ratios of Earnings to Fixed Charges:
Including interest on deposits................ 1.54x 1.51x 1.43x 1.22x 1.01x
Excluding interest on deposits................ 4.26x 5.00x 5.66x 4.54x 1.25x
</TABLE>
For purposes of computing the ratios of earnings to fixed charges, earnings
represent net income (loss) before extraordinary items and cumulative effect of
changes in accounting principles plus applicable income taxes and fixed charges.
Fixed charges, include gross interest expense (exclusive of interest on deposits
in one case and inclusive of such interest in the other) and one-third of rent
expenses which approximates the interest expense of such charges.
21
<PAGE>
CAPITALIZATION
The following table sets forth the unaudited consolidated capitalization of
the Corporation as of December 31, 1996, and such capitalization as adjusted, to
give effect to the consummation of the offering of the Trust Preferred
Securities offered hereby. The following data should be read in conjunction with
the financial information included in documents incorporated herein by reference
or included herein. See "Incorporation of Certain Documents by Reference."
December 31, 1996
-----------------
Actual As Adjusted
------ -----------
(Dollars in Thousands)
Deposits ............................................. $ 918,572 $ 918,572
Advances from Federal Home Loan Bank ................. 78,000 78,000
Federal funds purchased and assets sold under
agreements to repurchase ............................ 840 840
Treasury tax and loan notes .......................... 2,296 2,296
Other liabilities .................................... 11,975 11,975
---------- ----------
Total liabilities .................................... $1,011,683 $1,011,683
---------- ----------
Corporation-obligated mandatorily redeemable trust
preferred securities of subsidiary trust holding
solely junior subordinated debentures of the
Corporation(1) ..................................... -- 25,000
---------- ----------
Stockholders' equity:
Preferred stock, par value $.01 per share, 1,000,000
shares authorized, none issued ................... -- --
Common stock, par value $0.01 per share, 30,000,000
shares authorized, 14,604,501 shares issued ...... 146 146
Surplus ............................................ 44,433 44,433
Retained earnings .................................. 36,666 36,666
Unrealized loss on securities available for sale,
net of tax ........................................ (135) (135)
---------- ----------
Total stockholders' equity ........................... 81,110 81,110
---------- ----------
Total liabilities, minority interest in subsidiaries
and stockholders' equity ............................ $1,092,793 $1,117,793
========== ==========
- -----------
(1) Reflects the Trust Preferred Securities at their issue price. As described
herein, the sole assets of the Trust, which is a subsidiary of the Corporation,
will be $25,774,000 aggregate principal amount of the Junior Subordinated
Debentures (including the amounts attributable to the issuance of the Common
Securities of the Trust), which will mature on _______, 2027. The Corporation
will own all of the Common Securities issued by the Trust.
22
<PAGE>
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated as a subsidiary
of the Corporation and, accordingly, the accounts of the Trust will be included
in the consolidated financial statements of the Corporation. The Trust Preferred
Securities will be presented as a separate line item in the consolidated balance
sheets of the Corporation, entitled "Corporation-Obligated Mandatorily
Redeemable Trust Preferred Securities of Subsidiary Trust Holding Solely Junior
Subordinated Debentures of the Corporation" and appropriate disclosures about
the Trust Preferred Securities, the Guarantee and the Junior Subordinated
Debentures will be included in the notes to the consolidated financial
statements of the Corporation. For financial reporting purposes, the Corporation
will record Distributions payable on the Trust Preferred Securities as a
minority interest expense in its consolidated statements of income.
23
<PAGE>
RECENT DEVELOPMENTS
(Dollars in Thousands, Except Per Share Data)
The summary consolidated financial data as of and for the three month
periods ended March 31, 1997 and 1996 have been derived from the unaudited
consolidated financial statements of the Corporation which have been prepared by
management on the same basis as the audited consolidated financial statements of
the Corporation incorporated by reference herein and, in the opinion of
management of the Corporation, reflect all adjustments, consisting of only
normal recurring adjustments, necessary for a fair presentation of such data as
of such dates.
March 31, December 31,
Balance Sheet Data: 1997 1996
---- ----
Total assets......................................... $1,118,767 $1,092,793
Loans, net of unearned discount...................... 715,714 695,406
Securities held to maturity.......................... 301,182 290,894
Securities available for sale........................ 31,463 26,449
Total deposits....................................... 909,370 918,572
Stockholders' equity................................. 82,908 81,110
Nonperforming loans.................................. 4,287 4,462
Nonperforming assets................................. 4,833 4,733
Reserve for possible loan losses..................... 12,142 12,221
Three Months Ended March 31,
----------------------------
Operations Data: 1997 1996
---- ----
Interest income...................................... $20,626 $18,564
Interest expense..................................... 8,799 7,699
------- -------
Net interest income.................................. 11,827 10,865
Provision for possible loan losses................... 500 250
------- -------
Net interest income after provision for loan losses.. 11,327 10,615
Non-interest income.................................. 3,157 3,143
Non-interest expense................................. 9,788 9,687
------- -------
Income before income taxes........................... 4,696 4,071
Income taxes......................................... 1,699 1,494
------- -------
Net income........................................... $ 2,997 $ 2,577
======= =======
Per Share Data:
Net income........................................... $.20 $.18
Cash dividends....................................... .08 .06
Book value, end of period............................ 5.67 5.10
(Continued on next page)
24
<PAGE>
At or For the
Three Months Ended
March 31,
--------------------
Selected Financial Ratios(1): 1997 1996
---- ----
Return on average assets.................................. 1.09% 1.06%
Return on average equity.................................. 14.55 14.05
Net interest margin....................................... 4.60 4.79
Operating expenses as a percent of average
assets(2) ................. ............................ 3.61 4.00
Nonperforming assets as a percent of total assets
at end of period........................................ .43 .67
Reserve for possible loan losses as a percent of
nonperforming loans at end of period................... 283.23 193.29
Dividend payout ratio..................................... 39.00 33.80
Capital ratios at end of period:
Tier 1 leverage capital ratio....................... 7.33 7.35
Tier 1 risk-based capital ratio..................... 11.09 10.63
Total risk-based capital ratio...................... 12.35 11.89
- ----------
(1) With the exception of end-of-period ratios, all ratios are based on average
daily balances during the indicated periods.
(2) Annualized
The Corporation earned $3.0 million or $.20 per share during the three
months ended March 31, 1997, compared to $2.6 million or $.18 per share for the
comparable quarter in 1996. The $420,000 or 16.3% increase was primarily due to
a $962,000 or 8.9% increase in net interest income. The increase in interest net
income was due to a $68.0 million or 10.7% increase in the average balance of
the loan portfolio, net of unearned discount, resulting from increases in both
the residential and commercial real estate portfolios and indirect automobile
lending, as well as a $56.5 million or 21.0% increase in the investment
securities portfolio, which reflects the Corporation's strategy of leveraging
its capital. The average balance of borrowings increased by $50.7 million or
93.0%, while the average balance of deposits increased by $64.1 million or 7.7%.
The provision for loan losses increased by $250,000 or 50%, as management
determined that an increase was appropriate due to the increase in the size of
the loan portfolio.
The Corporation's non-interest income was essentially unchanged during the
three months ended March 31, 1997 over the comparable period. During the current
quarter, income from trust services increased by $100,000 or 17%. This increase
was offset by a non-recurring recovery of $95,000 during the March 1996 quarter
associated with a former real estate owned property.
25
<PAGE>
The Corporation's non-interest expense increased by $101,000 or 1.0% during
the quarter ended March 31, 1997 over the comparable period. As previously
reported, in connection with a change in the Bank's pension plan which was
effective January 1, 1997, the Corporation recognized $394,000 of previously
accrued pension liability as a credit against non-interest expense during the
March 31, 1997 quarter. Without giving effect to the aforementioned credit,
non-interest expense increased by $495,000 or 5.0%.
26
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in Thousands, Except Per Share Data)
The selected consolidated financial data below should be read in connection
with the financial information included in the Corporation's Annual Report on
Form 10-K for the year ended December 31, 1996. See "Available Information" and
"Incorporation of Certain Documents by Reference."
<TABLE>
<CAPTION>
At December 31,
--------------------------------------------------
Balance Sheet Data: 1996 1995 1994 1993 1992
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Total assets ..................... $1,092,793 $987,589 $929,194 $829,681 $807,146
Loans, net of unearned discount... 695,406 628,141 590,689 487,584 499,052
Securities held to maturity ...... 290,894 226,896 256,785 266,544 194,635
Securities available for sale .... 26,449 32,628 4,250 -- --
Total deposits ................... 918,572 871,085 796,612 743,385 729,020
Stockholders' equity ............. 81,110 72,572 64,202 57,385 52,746
Nonperforming loans .............. 4,462 5,271 7,864 16,982 28,802
Nonperforming assets ............. 4,733 5,909 11,730 25,866 44,714
Reserve for possible loan losses.. 12,221 12,088 13,719 15,485 15,971
</TABLE>
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------
Operations Data: 1996 1995 1994 1993 1992
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Interest income ....................... $77,211 $73,031 $63,487 $57,450 $63,055
Interest expense ...................... 32,354 29,143 22,029 22,920 29,127
------- ------- ------- ------- -------
Net interest income ................... 44,857 43,888 41,458 34,530 33,928
Provision for possible loan
losses ............................... 1,750 1,000 801 5,075 11,014
------- ------- ------- ------- -------
Net interest income after provision for
loan losses ........................ 43,107 42,888 40,657 29,455 22,914
Non-interest income ................... 12,709 11,480 11,470 12,995 17,059
Non-interest expenses ................. 38,066 39,252 42,481 37,331 39,583
------- ------- ------- ------- -------
Income before income taxes ............ 17,750 15,116 9,646 5,119 390
Income taxes .......................... 6,153 4,729 1,533 483 215
------- ------- ------- ------- -------
Net income ............................ $11,597 $10,387 $ 8,113 $ 4,636 $ 175
======= ======= ======= ======= =======
Per Share Data:
Net income ............................ $0.79 $0.71 $0.56 $0.32 $0.03
Cash dividends ........................ 0.25 0.18 0.08 -- --
Book value, end of period ............. 5.55 5.00 4.45 3.98 3.66
</TABLE>
(Continued on next page)
27
<PAGE>
<TABLE>
<CAPTION>
At or For the Year Ended December 31,
-------------------------------------------
Selected Financial Ratios(1): 1996 1995 1994 1993 1992
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Return on average assets .................... 1.13% 1.10% 0.94% 0.59% 0.02%
Return on average equity .................... 15.20 15.28 13.36 8.48 0.56
Net interest margin ......................... 4.70 4.99 5.18 4.74 4.74
Operating expenses as a percent of
average assets ............................. 3.7 4.1 4.9 4.7 4.9
Nonperforming assets as a percent of
total assets at end of period .............. 0.43 0.60 1.26 3.12 5.54
Reserve for possible loan losses as a percent
of nonperforming loans at end of period .... 273.89 229.33 174.45 91.18 55.45
Dividend payout ratio ....................... 31.6 25.4 14.3 N/A N/A
Capital ratios at end of period:
Tier 1 leverage capital ratio ......... 7.35 7.24 6.76 6.83 6.50
Tier 1 risk-based capital ratio ....... 10.89 10.67 10.05 10.71 9.67
Total risk-based capital ratio ........ 12.15 11.92 11.31 11.98 10.94
</TABLE>
- ----------
(1) With the exception of end-of-period ratios, all ratios are based on average
daily balances during the indicated periods.
28
<PAGE>
MANAGEMENT OF INDEPENDENT AND THE BANK
The executive officers and directors of the Corporation and the Bank are as
follows:
Name Position
- ------------------------ -----------------------------------------------------
John F. Spence, Jr. Chairman of the Board of Directors and Chief
Executive Officer of the Company; Chairman of the
Board of the Directors of the Bank
Douglas H. Philipsen President of the Company; President and Chief
Executive Officer of the Bank
Richard J. Seaman Chief Financial Officer and Treasurer of the Company
and the Bank
Richard F. Driscoll Executive Vice President, Retail and Operations
Division of the Bank
Ferdinand T. Kelley Executive Vice President, Commercial Lending Division
of the Bank
S. Lee Miller Executive Vice President, Trust and Financial
Services Division of the Bank
Raymond G. Fuerschbach Senior Vice President and Human Resource Officer of
the Bank
Richard S. Anderson Director
Donald S. Atkins Director
W. Paul Clark Director
Robert L. Cushing Director
Benjamin A. Gilmore, II Director
Lawrence M. Levinson Director
Richard H. Sgarzi Director
Robert J. Spence Director
William J. Spence Director
Brian S. Tedeschi Director
Thomas J. Teuten Director
29
<PAGE>
John F. Spence, Jr. Mr. Spence is Chairman of the Board of Directors and
Chief Executive Officer of the Company and Chairman of the Bank. He served as
President of the Company from January to December 1991. Mr. Spence has been a
director of the Bank since 1951 and served in various executive positions with
the Bank beginning in 1965, including Chief Executive Officer, a position he
held from 1976 until 1991. He became Chairman of the Board of the Bank in 1972
and Chairman of the Board of Directors and Chief Executive Officer of the
Company in 1986.
Douglas H. Philipsen. Mr. Philipsen is President of the Company and
President and Chief Executive Officer of the Bank. Mr. Philipsen joined the Bank
in December 1991 as President, Chief Executive Officer and a director. At that
time, he also became President and a director of the Company. From October 1987
through November 1990, Mr. Philipsen served as President and Chief Executive
Officer of Bank of New England-Worcester, Worcester, Massachusetts, and its
predecessor financial institutions, Guaranty Bank & Trust and Consumers Savings
Bank.
Richard Seaman. Mr. Seaman has been the Chief Financial Officer and
Treasurer of the Company and the Bank since July 1992. From December 1990 to
July 1992, Mr. Seaman was a management consultant with RJS Associates and
Danielson Associates, Inc., Rockville, Maryland, providing consulting to the
financial services industry on, among other matters, troubled bank
rehabilitation.
Richard F. Driscoll. Mr. Driscoll has been Executive Vice President, Retail
and Operations Division of the Bank since March 1992. Prior thereto, Mr.
Driscoll served as Executive Vice President--Dealer Lending Division of Fleet
Bank--Massachusetts, N.A. from July 1991 to March 1992.
Ferdinand T. Kelley. Mr. Kelley has served as Executive Vice President,
Commercial Lending Division of the Bank, since February 1993. Prior thereto, Mr.
Kelley served as Senior Vice President and Credit Administrator of Multibank
Financial Corp., Dedham, Massachusetts, from August 1992 to January 1993. From
February 1990 to July 1991, Mr. Kelley was the Regional President of the
Worcester Region (Central Massachusetts) of Bank of New England, N.A., and
continued in that position with Fleet Bank of Massachusetts, N.A., from July
1991 to August 1992 following the Bank of New England's acquisition by Fleet
Bank.
S. Lee Miller. Mr. Miller has been Executive Vice President, Trust and
Financial Services Division of the Bank since July 1994. Prior thereto, Mr.
Miller was President and Chief Executive Officer of Old Stone Trust Company, a
subsidiary of Old Stone Bank in Providence, Rhode Island from 1971 through July
1994.
Raymond G. Fuerschbach. Mr. Fuerschbach has served as Senior Vice
President, Human Resources Division of the Bank, since April 1994. Prior
thereto, Mr. Fuerschbach had been Vice President and Human Resource Officer of
the Bank since November 1992. From January 1991
30
<PAGE>
to October 1992, Mr. Fuerschbach served as Director of Human Resources for
Cliftex Corp., New Bedford, Massachusetts, a tailored clothing manufacturer.
Richard S. Anderson. Mr. Anderson is an owner and principal executive of
Anderson-Cushing Insurance Agency, Inc. (insurance broker, Middleboro,
Massachusetts). Mr. Anderson became a director of the Company and the Bank in
1992 and served as a director of Middleborough from 1980 until its merger with
the Bank.
Donald K. Atkins. Mr. Atkins served as President and Chief Executive
Officer of Winthrop-Atkins Co., Inc. (manufacturer of calendars, Middleboro,
Massachusetts) until his retirement in 1987. Mr. Atkins, a director of the
Company since 1986, became a director of the Bank in 1992 and served as a
director of Middleborough from 1963 until its merger with the Bank.
W. Paul Clark. Mr. Clark is the President and General Manager of Paul
Clark, Inc. (Ford and Volkswagen dealership, Brockton, Massachusetts). Mr. Clark
has served as a director of the Bank since 1970 and of the Company since 1986.
Robert L. Cushing. Mr. Cushing is owner of Robert L. Cushing Insurance
(insurance broker associated with Anderson-Cushing Insurance Agency, Inc.,
Middleboro, Massachusetts). Mr. Cushing was a director of Middleborough from
1957 until 1990 at which time he became an honorary director of Middleborough.
Mr. Cushing became a director of the Company in 1986 and an honorary director of
the Bank in 1992.
Benjamin A. Gilmore II. Mr. Gilmore is President of Gilmore Cranberry Co.
(cranberry grower, South Carver, Massachusetts). Mr. Gilmore became a director
of Middleborough in 1989 and a director of the Company and the Bank in 1992.
Lawrence M. Levinson. Mr. Levinson is a partner in the law firm of Burns &
Levinson, Boston, Massachusetts and has been a practicing attorney in Boston
since 1948. Mr. Levinson was a director of the Bank from 1960 until 1990, at
which time he became an honorary director of the Bank. Mr. Levinson has served
as a director of the Company since 1986. Mr. Levinson is also a director of
Arrow Automotive Industries, Inc. and Sonesta International Hotels Corporation.
Richard H. Sgarzi. Mr. Sgarzi is the Treasurer of Black Cat Cranberry Corp.
(cranberry grower, Plymouth, Massachusetts). Mr. Sgarzi has served as a director
of the Company since 1994 and of the Bank since 1980.
Robert J. Spence. Mr. Spence is President of Albert Culver Co. (retail fuel
company, Rockland, Massachusetts). Mr. Spence has served as a director of the
Bank since 1961 and of the Company since 1986.
31
<PAGE>
William J. Spence. Mr. Spence is President of Mass. Bay Lines, Inc.
(excursion boat rentals, Boston, Massachusetts) and President of New Boston
Concessions, Inc. (food and beverage concessionaire, Boston, Massachusetts). Mr.
Spence became a director of the Bank in 1966 and a director of the Company in
1986.
Brian S. Tedeschi. Mr. Tedeschi is President of Tedeschi Realty Corp. (real
estate development, Rockland, Massachusetts). Mr. Tedeschi has served as a
director of the Bank since 1980 and of the Company since 1991.
Thomas J. Teuten. Mr. Teuten is Executive Vice President, A.W. Perry, Inc.
and A.W. Perry Security Corporation (real estate investment, Boston,
Massachusetts). Mr. Teuten has served as a director of the Bank since 1975 and
of the Company since 1986.
32
<PAGE>
INDEPENDENT CAPITAL TRUST I
The Trust is a statutory business trust formed under Delaware law upon the
filing of a certificate of trust with the Delaware Secretary of State. The Trust
exists for the exclusive purposes of (i) issuing and selling the Trust
Securities, (ii) using the proceeds from the sale of Trust Securities to acquire
the Junior Subordinated Debentures and (iii) engaging in only those other
activities necessary, advisable or incidental thereto. The Junior Subordinated
Debentures will be the sole assets of the Trust, and, accordingly, payments
under the Junior Subordinated Debentures will be the sole revenues of the Trust.
All of the Common Securities will be owned by the Corporation. The Common
Securities will rank pari passu, and payments will be made thereon pro rata,
with the Trust Preferred Securities, except that upon the occurrence and
continuance of an event of default under the Trust Agreement resulting from a
Debenture Event of Default, the rights of the Corporation as holder of the
Common Securities to payments in respect of Distributions and payments upon
liquidation, redemption or otherwise will be subordinated to the rights of the
holders of the Trust Preferred Securities. See "Description of Trust Preferred
Securities--Subordination of Common Securities." The Corporation will acquire
Common Securities in a Liquidation Amount equal to at least 3% of the total
capital of the Trust. The Trust has a term of 31 years, but may terminate
earlier as provided in the Trust Agreement. The Trust's business and affairs are
conducted by the Issuer Trustees, each appointed by the Corporation as holder of
the Common Securities. The Issuer Trustees for the Trust will be The Bank of New
York, as the Property Trustee, The Bank of New York (Delaware), as the Delaware
Trustee and three Administrative Trustees who are officers of the Corporation.
The Bank of New York, as Property Trustee, will act as sole indenture trustee
under the Trust Agreement. The Bank of New York will also act as indenture
trustee under the Guarantee and the Indenture. See "Description of Guarantee"
and "Description of Junior Subordinated Debentures." The holder of the Common
Securities of the Trust or, if an Event of Default under the Trust Agreement has
occurred and is continuing, the holders of not less than a majority in
Liquidation Amount of the Trust Preferred Securities will be entitled to
appoint, remove or replace the Property Trustee and/or the Delaware Trustee. In
no event will the holders of the Trust Preferred Securities have the right to
vote to appoint, remove or replace the Administrative Trustees; such voting
rights will be vested exclusively in the holder of the Common Securities. The
duties and obligations of each Issuer Trustee are governed by the Trust
Agreement. The Corporation, as issuer of the Junior Subordinated Debentures,
will pay all fees, expenses, debts and obligations (other than the payment of
principal, interest and premium, if any, on the Trust Securities) related to the
Trust and the offering of the Trust Preferred Securities and will pay, directly
or indirectly, all ongoing costs, expenses and liabilities (other than the
payment of principal, interest and premium, if any, on the Trust Securities) of
the Trust. The principal executive office of the Trust is c/o The Bank of New
York, 101 Barclay Street, New York, New York 10286.
33
<PAGE>
DESCRIPTION OF TRUST PREFERRED SECURITIES
The Trust Preferred Securities will represent undivided beneficial
interests in the Trust and the holders thereof will be entitled to a preference
over the Common Securities in certain circumstances with respect to
Distributions and amounts payable on redemption of the Trust Securities or
liquidation of the Trust. See "--Subordination of Common Securities." The Trust
Agreement will be qualified under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"). This summary of certain provisions of the Trust
Preferred Securities, the Common Securities and the Trust Agreement does not
purport to be complete and is subject to, and is qualified in its entirety by
reference to, all the provisions of the Trust Agreement, including the
definitions therein of certain terms, and the Trust Indenture Act. The form of
the Trust Agreement has been filed as an exhibit to the Registration Statement
of which this Prospectus forms a part.
General
Pursuant to the terms of the Trust Agreement, the Issuer Trustees, on
behalf of the Trust, will issue the Trust Securities. All of the Common
Securities will be owned by the Corporation. The Trust Preferred Securities will
represent preferred undivided beneficial interests in the assets of the Trust
and the holders thereof will be entitled to a preference in certain
circumstances with respect to Distributions and amounts payable on redemption or
liquidation over the Common Securities, as well as other benefits as described
in the Trust Agreement. The Trust Agreement does not permit the issuance by the
Trust of any securities other than the Trust Securities or the incurrence of any
indebtedness by the Trust.
The Trust Preferred Securities will rank pari passu, and payments will be
made thereon pro rata, with the Common Securities except as described under
"--Subordination of Common Securities." Legal title to the Junior Subordinated
Debentures will be held by the Property Trustee in trust for the benefit of the
holders of the Trust Securities. The Guarantee will not guarantee payment of
Distributions or amounts payable on redemption of the Trust Preferred Securities
or liquidation of the Trust when the Trust does not have funds on hand legally
available for such payments. See "Description of Guarantee."
Distributions
Payment of Distributions. Distributions on each Trust Preferred Security
will be cumulative, will accumulate from __________ __, 1997 and will be payable
quarterly in arrears on the __ day of March, June, September and December of
each year, commencing _________, 1997, at the annual rate of _____% of the
stated Liquidation Amount of $25, to the holders of the Trust Preferred
Securities on the relevant record date which, for so long as the Trust Preferred
Securities remain in book-entry form, will be one Business Day (as defined
below) prior to the relevant Distribution Date and, in the event the Trust
Preferred Securities are not in book-entry form, will be the [first day of the
month/fifteenth day of the month immediately preceding the month] in which the
relevant Distribution Date occurs. The amount of Distributions payable
34
<PAGE>
for any period will be computed on the basis of a 360-day year of twelve 30-day
months and, for any period of less than a full calendar month, the number of
days elapsed in such month. In the event that any date on which Distributions
are payable on the Trust Preferred Securities is not a Business Day (as defined
below), payment of the Distribution payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect to any such delay), except that if such next succeeding
Business Day falls in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case with the same force
and effect as if made on such date (each date on which Distributions are payable
in accordance with the foregoing, a "Distribution Date"). A "Business Day" shall
mean any day other than a Saturday or a Sunday, or a day on which banking
institutions in the City of New York or Rockland, Massachusetts are authorized
or required by law or executive order to remain closed.
Extension Period. So long as no Debenture Event of Default shall have
occurred and be continuing, the Corporation will have the right under the
Indenture to elect to defer the payment of interest on the Junior Subordinated
Debentures at any time or from time to time for a period not exceeding 20
consecutive quarterly periods with respect to each Extension Period, provided
that no Extension Period shall end on a date other than an Interest Payment Date
or extend beyond the Stated Maturity Date. Upon any such election, quarterly
Distributions on the Trust Preferred Securities will be deferred by the Trust
during such Extension Period. Distributions to which holders of the Trust
Preferred Securities are entitled during any such Extension Period will
accumulate additional Distributions thereon at the rate per annum of ____%
thereof, compounded quarterly from the relevant Distribution Date. The term
"Distributions," as used herein, shall include any such additional
Distributions.
Prior to the termination of any such Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods, to end
on a date other than an Interest Payment Date or to extend beyond the Stated
Maturity Date. Upon the termination of any such Extension Period and the payment
of all amounts then due on any Interest Payment Date, the Corporation may elect
to begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
The Corporation must give the Property Trustee, the Administrative Trustees and
the Debenture Trustee notice of its election of any such Extension Period (or an
extension thereof) at least five Business Days prior to the earlier of (i) the
date the Distributions on the Trust Preferred Securities would have been payable
except for the election to begin such Extension Period and (ii) the date the
Administrative Trustees are required to give notice to any securities exchange
or automated quotation system or to holders of such Trust Preferred Securities
of the record date or the date such Distributions are payable, but in any event
not less than five Business Days prior to such record date. There is no
limitation on the number of times that the Corporation may elect to begin an
Extension Period. See "Description of Junior Subordinated Debentures--Option to
Extend Interest Payment Date" and "Certain Federal Income Tax
Consequences--Interest Income and Original Issue Discount."
35
<PAGE>
During any such Extension Period, the Corporation may not (i) declare or
pay any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock,
(ii) make any payment of principal of or premium, if any, on or repay,
repurchase or redeem any debt securities of the Corporation (including any Other
Debentures) that rank pari passu with or junior in right of payment to the
Junior Subordinated Debentures or (iii) make any guarantee payments with respect
to any guarantee by the Corporation of the debt securities of any subsidiary of
the Corporation (including Other Guarantees) if such guarantee ranks pari passu
with or junior in right of payment to the Junior Subordinated Debentures (other
than (a) dividends or distributions in shares of, or options, warrants or rights
to subscribe for or purchase shares of, common stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of the Corporation's capital stock, (e) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged and (f) purchases of common stock related to the
issuance of common stock or rights under any of the Corporation's benefit plans
for its directors, officers or employees or any of the Corporation's dividend
reinvestment plans).
The Corporation has no current intention to exercise its option to defer
payments of interest on the Junior Subordinated Debentures.
Source of Distribution. The revenue of the Trust available for distribution
to holders of the Trust Preferred Securities will be limited to payments under
the Junior Subordinated Debentures in which the Trust will invest the proceeds
from the issuance and sale of the Trust Securities. See "Description of Junior
Subordinated Debentures--General." If the Corporation does not make interest
payments on the Junior Subordinated Debentures, the Property Trustee will not
have funds available to pay Distributions on the Trust Preferred Securities. The
payment of Distributions (if and to the extent the Trust has funds on hand
legally available for the payment of such Distributions) will be guaranteed by
the Corporation on a limited basis as set forth herein under "Description of
Guarantee."
Redemption
Mandatory Redemption. Upon the repayment or redemption at any time, in
whole or in part, of any Junior Subordinated Debentures, the proceeds from such
repayment or prepayment shall be applied by the Property Trustee to redeem a
Like Amount (as defined below) of the Trust Securities, upon not less than 30
nor more than 60 days' notice of a date of redemption (the "Redemption Date"),
at a redemption price equal to 100% of the principal amount of the Trust
Securities together with accrued and unpaid interest thereon. See "Description
of Junior Subordinated Debentures--Redemption." If less than all of the Junior
Subordinated Debentures are to be prepaid on a Redemption Date, then the
proceeds of such prepayment shall be allocated pro rata to the Trust Securities.
36
<PAGE>
Optional Redemption. The Corporation will have the right to redeem the
Junior Subordinated Debentures (i) on or after _________________, 2002, in whole
at any time or in part from time to time at a redemption price equal to the
accrued and unpaid interest on the Junior Subordinated Debentures so redeemed to
the date fixed for redemption, plus 100% of the principal amount thereof, in
each case subject to receipt of prior approval by the Federal Reserve. See
"Description of Junior Subordinated Debentures--Redemption."
Tax Event, Investment Company Event, Regulatory Capital Event or
Distribution of Junior Subordinated Debentures. If a Special Event shall occur
and be continuing, the Corporation has the right to redeem the Junior
Subordinated Debentures in whole (but not in part) and thereby cause a mandatory
redemption of the Trust Securities in whole (but not in part) at the redemption
price within 90 days following the occurrence of such Special Event, in each
case subject to receipt of prior approval by the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve.
In the event a Special Event, has occurred and is continuing and the Corporation
does not elect to redeem the Junior Subordinated Debentures and thereby cause a
mandatory redemption of the Trust Securities or to liquidate the Trust and cause
the Junior Subordinated Debentures to be distributed to holders of the Trust
Securities in liquidation of the Trust as described below, such Trust Securities
will remain outstanding and Additional Sums (as defined below) may be payable on
the Junior Subordinated Debentures.
Definitions
"Additional Sums" means the additional amounts as may be necessary to be
paid by the Corporation with respect to the Junior Subordinated Debentures in
order that the amount of Distributions then due and payable by the Trust on the
outstanding Trust Securities of the Trust shall not be reduced as a result of
any additional taxes, duties and other governmental charges to which the Trust
has become subject as a result of a Tax Event.
An "Investment Company Event" means the receipt by the Corporation of an
opinion of counsel experienced in such matters to the effect that, as a result
of any change in law or regulation or a change in interpretation or application
of law or regulation by any legislative body, court, governmental agency or
regulatory authority the Trust is or will be considered an "investment company"
that is required to be registered under the Investment Company Act, which change
becomes effective on or after the original issuance of the Trust Preferred
Securities.
"Like Amount" means (i) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount (as defined below) equal to that
portion of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Trust Preferred Securities based upon the relative
Liquidation Amounts of such classes and the proceeds of which will be used to
pay the redemption price of such Trust Securities, and (ii) with respect to a
distribution of Junior Subordinated Debentures to holders of Trust Securities in
connection with a dissolution or liquidation of the Trust, Junior Subordinated
Debentures having a principal amount equal to the
37
<PAGE>
Liquidation Amount of the Trust Securities of the holder to whom such Junior
Subordinated Debentures are distributed.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
A "Regulatory Capital Event" means that the Corporation shall have received
an opinion of independent bank regulatory counsel experienced in such matters to
the effect that, as a result of (a) any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any rules, guidelines or policies of the Federal Reserve or
(b) any official administrative pronouncement or judicial decision interpreting
or applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after date of the original
issuance of the Trust Preferred Securities, the Trust Preferred Securities do
not constitute, or within 90 days of the date thereof, will not constitute, Tier
I Capital (or its then equivalent); provided, however, that the distribution of
the Junior Subordinated Debentures in connection with the termination of the
Trust by the Corporation shall not in and of itself constitute a Regulatory
Capital Event.
A "Special Event" means a Tax Event, an Investment Company Event or a
Regulatory Capital Event, as the case may be.
A "Tax Event" means the receipt by the Corporation and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective change) in,
the laws or any regulations thereunder of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after the original issuance of
the Trust Preferred Securities, there is more than an insubstantial risk that
(i) the Trust is, or will be within 90 days of the date of such opinion, subject
to United States federal income tax with respect to income received or accrued
on the Junior Subordinated Debentures, (ii) interest payable by the Corporation
on the Junior Subordinated Debentures is not, or within 90 days of the date of
such opinion will not be, deductible by the Corporation, in whole or in part,
for United States federal income tax purposes or (iii) the Trust is, or will be
within 90 days of the date of such opinion, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
38
<PAGE>
Distribution of Junior Subordinated Debentures
The Corporation will have the right at any time to terminate the Trust and,
after satisfaction of liabilities to creditors of the Trust as required by
applicable law, to cause the Junior Subordinated Debentures to be distributed to
the holders of the Trust Securities in liquidation of the Trust. Such right is
subject to (i) the Corporation having received an opinion of counsel to the
effect that such distribution will not be a taxable event to holders of Trust
Preferred Securities and (ii) the prior approval by the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve.
After the liquidation date is fixed for any distribution of Junior
Subordinated Debentures to holders of the Trust Securities, (i) the Trust
Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee
will receive, in respect of each registered global certificate, if any,
representing Trust Securities and held by it, a registered global certificate or
certificates representing the Junior Subordinated Debentures to be delivered
upon such distribution and (iii) any certificates representing Trust Securities
not held by DTC or its nominee will be deemed to represent Junior Subordinated
Debentures having a principal amount equal to the Liquidation Amount of such
Trust Securities, and bearing accrued and unpaid interest in an amount equal to
the accumulated and unpaid Distributions on such Trust Securities until such
certificates are presented to the Administrative Trustees or their agent for
cancellation, whereupon the Corporation will issue to such holder, and the
Debenture Trustee will authenticate, a certificate representing such Junior
Subordinated Debentures.
There can be no assurance as to the market prices for the Trust Preferred
Securities or the Junior Subordinated Debentures that may be distributed in
exchange for the Trust Securities if a dissolution and liquidation of the Trust
were to occur. Accordingly, the Trust Preferred Securities that an investor may
purchase, or the Junior Subordinated Debentures that the investor may receive on
dissolution and liquidation of the Trust, may trade at a discount to the price
that the investor paid to purchase the Trust Preferred Securities offered
hereby.
Redemption Procedures
If applicable, Trust Securities shall be redeemed at the redemption price
with the proceeds from the contemporaneous repayment or prepayment of the Junior
Subordinated Debentures. Any redemption of Trust Securities shall be made and
the redemption price shall be payable on the Redemption Date only to the extent
that the Trust has funds legally available for the payment of such redemption
price. See also "--Subordination of Common Securities."
If the Trust gives a notice of redemption in respect of the Trust Preferred
Securities, then, by 12:00 noon, New York City time, on the Redemption Date, to
the extent funds are legally available, with respect to the Trust Preferred
Securities held by DTC or its nominees, the Property Trustee will deposit or
cause the Paying Agent (as defined herein) to deposit irrevocably with DTC funds
sufficient to pay the redemption price and will give DTC or its nominees
irrevocable instructions and authority to pay the redemption price to the
holders of such Trust
39
<PAGE>
Preferred Securities. See "Book-Entry Issuance." If such Trust Preferred
Securities are no longer in book-entry form, the Property Trustee, to the extent
funds are legally available, will irrevocably deposit with the paying agent for
such Trust Preferred Securities funds sufficient to pay the aggregate redemption
price and will give such paying agent irrevocable instructions and authority to
pay the redemption price to the holders thereof upon surrender of their
certificates evidencing such Trust Preferred Securities. Notwithstanding the
foregoing, Distributions payable on or prior to the Redemption Date shall be
payable to the holders of such Trust Preferred Securities on the relevant record
dates for the related Distribution Dates. If notice of redemption shall have
been given and funds deposited as required, then upon the date of such deposit,
all rights of the holders of the Trust Preferred Securities called for
redemption will cease, except the right of the holders of such Trust Preferred
Securities to receive the redemption price, but without interest on such
redemption price and such Trust Preferred Securities will cease to be
outstanding. In the event that any Redemption Date of Trust Preferred Securities
is not a Business Day, then the redemption price, payable on such date will be
paid on the next succeeding day that is a Business Day (and without any interest
or other payment in respect of any such delay), except that, if such next
succeeding Business Day falls in the next calendar year, such payment shall be
made on the immediately preceding Business Day. In the event that payment of the
redemption price is improperly withheld or refused and not paid either by the
Trust or by the Corporation pursuant to the Guarantee as described under
"Description of Guarantee," (i) Distributions on Trust Preferred Securities will
continue to accumulate at the then applicable rate, from the Redemption Date
originally established by the Trust to the date such redemption price is
actually paid and (ii) the actual payment date will be the Redemption Date for
purposes of calculating the redemption price.
Subject to applicable law (including, without limitation, United States
federal securities law and the regulations of the Federal Reserve), the
Corporation or its subsidiaries may at any time and from time to time purchase
outstanding Trust Preferred Securities by tender, in the open market or by
private agreement.
Payment of the redemption price on the Trust Preferred Securities and any
distribution of Junior Subordinated Debentures to holders of Trust Preferred
Securities shall be made on the Redemption Date.
If less than all of the Trust Securities issued by the Trust are to be
redeemed on a Redemption Date, then the aggregate redemption price for such
Trust Securities to be redeemed shall be allocated pro rata to the Trust
Preferred Securities and Common Securities based upon the relative Liquidation
Amounts of such classes. The particular Trust Preferred Securities to be
redeemed shall be selected by the Property Trustee from the outstanding Trust
Preferred Securities not previously called for redemption, by such method as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to $25 or an integral multiple
thereof) of the Liquidation Amount of Trust Preferred Securities. The Property
Trustee shall promptly notify the security registrar in writing of the Trust
Preferred Securities selected for redemption and, in the case of any Trust
Preferred Securities selected for partial redemption, the Liquidation Amount
thereof to be redeemed. For
40
<PAGE>
all purposes of the Trust Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Trust Preferred Securities shall relate
to the portion of the aggregate Liquidation Amount of Trust Preferred Securities
which has been or is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more than
60 days prior to the Redemption Date to each holder of Trust Securities at its
registered address. Unless the Corporation defaults in payment of the redemption
price on, or in the repayment of, the Junior Subordinated Debentures, on and
after the Redemption Date, Distributions will cease to accrue on the Trust
Securities called for redemption.
Subordination of Common Securities
Payment of Distributions on, and the redemption price of, the Trust
Securities, as applicable, shall be made pro rata based on the Liquidation
Amount of the Trust Securities; provided, however, that if on any Distribution
Date or Redemption Date a Debenture Event of Default shall have occurred and be
continuing, no payment of any Distribution on, or applicable redemption price
of, any of the Common Securities, and no other payment on account of the
redemption, liquidation or other acquisition of the Common Securities, shall be
made unless payment in full in cash of all accumulated and unpaid Distributions
on all of the outstanding Trust Preferred Securities for all Distribution
periods terminating on or prior thereto, or in the case of payment of the
redemption price, the full amount of such redemption price, shall have been made
or provided for, and all funds available to the Property Trustee shall first be
applied to the payment in full in cash of all Distributions on, or redemption
price of, the Trust Preferred Securities then due and payable.
In the case of any Event of Default under the Trust Agreement relating to a
Debenture Event of Default, the Corporation as holder of the Common Securities
will be deemed to have waived any right to act with respect to such Event of
Default until the effect of such Event of Default shall have been cured, waived
or otherwise eliminated. Until any such Event of Default has been so cured,
waived or otherwise eliminated, the Property Trustee shall act solely on behalf
of the holders of the Trust Preferred Securities and not on behalf of the
Corporation as holder of the Common Securities, and only the holders of the
Trust Preferred Securities will have the right to direct the Property Trustee to
act on their behalf.
Liquidation Distribution Upon Termination
The Corporation will have the right at any time to terminate the Trust and
cause the Junior Subordinated Debentures to be distributed to the holders of the
Trust Preferred Securities. Such right is subject to (i) the Corporation having
received an opinion of counsel to the effect that such distribution will not be
a taxable event to holders of Trust Preferred Securities, and (ii) the
Corporation having received prior approval of the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve.
See "--Distribution of Junior Subordinated Debentures."
41
<PAGE>
In addition, the Trust shall automatically terminate upon the first to
occur of: (i) certain events of bankruptcy, dissolution or liquidation of the
Corporation; (ii) the distribution of a Like Amount of the Junior Subordinated
Debentures to the holders of the Trust Securities, if the Corporation, as
Sponsor, has given written direction to the Property Trustee to terminate the
Trust (which direction is optional and, except as described above, wholly within
the discretion of the Corporation, as Sponsor); (iii) redemption of all of the
Trust Securities as described under "--Redemption;" (iv) expiration of the term
of the Trust; and (v) the entry of an order for the dissolution of the Trust by
a court of competent jurisdiction.
If a termination occurs as described in clause (i), (ii), (iv), or (v)
above, the Trust shall be liquidated by the Issuer Trustees as expeditiously as
the Issuer Trustees determine to be possible by distributing, after satisfaction
of liabilities to creditors of the Trust as provided by applicable law, to the
holders of the Trust Securities a Like Amount of the Junior Subordinated
Debentures, unless such distribution is determined by the Property Trustee not
to be practicable, in which event such holders will be entitled to receive out
of the assets of the Trust legally available for distribution to holders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the aggregate of the Liquidation Amount plus accumulated
and unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can be paid only
in part because the Trust has insufficient assets on hand legally available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Trust Securities shall be paid on a pro rata basis,
except that if a Debenture Event of Default has occurred and is continuing, the
Trust Preferred Securities shall have a priority over the Common Securities. See
"--Subordination of Common Securities."
If the Corporation elects not to prepay the Junior Subordinated Debentures
prior to maturity in accordance with their terms and either elects not to or is
unable to liquidate the Trust and distribute the Junior Subordinated Debentures
to holders of the Trust Securities, the Trust Securities will remain outstanding
until the repayment of the Junior Subordinated Debentures on the Stated Maturity
Date.
If the Corporation elects to liquidate the Trust and thereby causes the
Junior Subordinated Debentures to be distributed to holders of the Trust
Preferred Securities in liquidation of the Trust, the Corporation shall continue
to have the right to shorten the maturity of such Junior Subordinated
Debentures, subject to certain conditions. See "Description of Junior
Subordinated Debentures--General."
42
<PAGE>
Events of Default; Notice
Any one of the following events that has occurred and is continuing
constitutes an "Event of Default" under the Trust Agreement (an "Event of
Default") with respect to the Trust Preferred Securities (whatever the reason
for such Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(i) the occurrence of a Debenture Event of Default (see "Description
of Junior Subordinated Debentures--Debenture Events of Default"); or
(ii) default by the Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(iii) default by the Trust in the payment of the redemption price of
any Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material respect,
of any covenant or warranty of the Issuer Trustees in the Trust Agreement
(other than a default or breach in the performance of a covenant or
warranty which is addressed in clause (ii) or (iii) above), and
continuation of such default or breach, for a period of 60 days after there
has been given, by registered or certified mail, to the defaulting Issuer
Trustee or Trustees by the holders of at least 25% in aggregate Liquidation
Amount of the outstanding Trust Preferred Securities, a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" under the Trust
Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by the Corporation to
appoint a successor Property Trustee within 60 days thereof.
Within ten Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Trust Preferred
Securities, the Administrative Trustees and the Corporation, as Sponsor, unless
such Event of Default shall have been cured or waived. The Corporation, as
Sponsor, and the Administrative Trustees are required to file annually with the
Property Trustee a certificate as to whether or not they are in compliance with
all the conditions and covenants applicable to them under the Trust Agreement.
If a Debenture Event of Default has occurred and is continuing, the Trust
Preferred Securities shall have a preference over the Common Securities as
described under "--Liquidation of the Trust and Distribution of Junior
Subordinated Debentures" and "--Subordination of Common Securities." Upon a
Debenture Event of Default, unless the principal of all the Junior Subordinated
Debentures has already become due and payable, either the Property Trustee or
the
43
<PAGE>
holders of not less than 25% in aggregate principal amount of the Junior
Subordinated Debentures then outstanding may declare all of the Junior
Subordinated Debentures to be due and payable immediately by giving notice in
writing to the Corporation (and to the Property Trustee, if notice is given by
holders of the Junior Subordinated Debentures). If the Property Trustee or the
holders of the Junior Subordinated Debentures fail to declare the principal of
all of the Junior Subordinated Debentures due and payable upon a Debenture Event
of Default, the holders of at least 25% in Liquidation Amount of the Trust
Preferred Securities then outstanding shall have the right to declare the Junior
Subordinated Debentures immediately due and payable. In either event, payment of
principal and interest on the Junior Subordinated Debentures shall remain
subordinated to the extent provided in the Indenture. In addition, holders of
the Trust Preferred Securities have the right in certain circumstances to bring
a Direct Action. See "Description of Junior Subordinated Debentures--Enforcement
of Certain Rights by Holders of Trust Preferred Securities."
Removal of Issuer Trustees
Unless a Debenture Event of Default shall have occurred and be continuing,
any Issuer Trustee may be removed at any time by the holder of the Common
Securities. If a Debenture Event of Default has occurred and is continuing, the
Property Trustee and the Delaware Trustee may be removed at such time by the
holders of a majority in Liquidation Amount of the outstanding Trust Preferred
Securities. In no event will the holders of the Trust Preferred Securities have
the right to vote to appoint, remove or replace the Administrative Trustees,
which voting rights are vested exclusively in the Corporation as the holder of
the Common Securities. No resignation or removal of an Issuer Trustee and no
appointment of a successor trustee shall be effective until the acceptance of
appointment by the successor trustee in accordance with the provisions of the
Trust Agreement.
Co-trustees and Separate Property Trustee
Unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of Trust Property may at
the time be located, the Corporation as the holder of the Common Securities, and
the Administrative Trustees shall have power to appoint one or more persons
either to act as a co-trustee, jointly with the Property Trustee, of all or any
part of such Trust Property, or to act as separate trustee of any such property,
in either case with such powers as may be provided in the instrument of
appointment, and to vest in such person or persons in such capacity any
property, title, right or power deemed necessary or desirable, subject to the
provisions of the Trust Agreement. In case a Debenture Event of Default has
occurred and is continuing, the Property Trustee alone shall have power to make
such appointment.
Merger or Consolidation of Issuer Trustees
Any Person into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee that is not a natural person may be merged or converted
or with which it may be
44
<PAGE>
consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Issuer Trustee shall be a party, or any Person
succeeding to all or substantially all the corporate trust business of such
Issuer Trustee, shall be the successor of such Issuer Trustee under the Trust
Agreement, provided such Person shall be otherwise qualified and eligible.
Mergers, Consolidations, Amalgamations or Replacements of the Trust
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets as an
entirety or substantially as an entirety to any corporation or other Person,
except as described below or as otherwise described under "--Liquidation of the
Trust and Distribution of Junior Subordinated Debentures." The Trust may, at the
request of the Corporation, as Sponsor, with the consent of the Administrative
Trustees but without the consent of the holders of the Trust Preferred
Securities, merge with or into, consolidate, amalgamate, or be replaced by or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to a trust organized as such under the laws of any
State; provided, that (i) such successor entity either (a) expressly assumes all
of the obligations of the Trust with respect to the Trust Securities or (b)
substitutes for the Trust Securities other securities having substantially the
same terms as the Trust Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Trust Securities rank in priority with
respect to distributions and payments upon liquidation, redemption and
otherwise, (ii) the Corporation expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee with
respect to the Junior Subordinated Debentures, (iii) the Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which the
Trust Preferred Securities are then listed or quoted, if any, (iv) if the Trust
Preferred Securities (including any Successor Securities) are rated by any
nationally recognized statistical rating organization prior to such transaction,
such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not cause the Trust Securities (including any Successor Securities)
or, if the Junior Subordinated Debentures are so rated, the Junior Subordinated
Debentures, to be downgraded by any such nationally recognized statistical
rating organization, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Trust Securities (including any Successor
Securities) in any material respect, (vi) such successor entity has a purpose
identical to that of the Trust, (vii) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Corporation has
received an opinion from independent counsel to the Trust experienced in such
matters to the effect that (a) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the Trust Securities (including any
Successor Securities) in any material respect (other than any dilution of such
holders' interests in the new entity), and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and (viii) the Corporation or any permitted successor
or assignee owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under
45
<PAGE>
the Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
holders of 100% in Liquidation Amount of the Trust Securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets as an entirety or substantially as an entirety to, any
other entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Trust or the successor entity not
to be classified as a grantor trust for United States federal income tax
purposes.
Voting Rights; Amendment of the Trust Agreement
Except as provided below and under "--Mergers, Consolidations,
Amalgamations or Replacements of the Trust" and "Description of
Guarantee--Amendments and Assignment" and as otherwise required by law and the
Trust Agreement, the holders of the Trust Preferred Securities will have no
voting rights.
The Trust Agreement may be amended from time to time by the Corporation,
the Property Trustee and the Administrative Trustees, without the consent of the
holders of the Trust Securities (i) to cure any ambiguity, correct or supplement
any provisions in the Trust Agreement that may be inconsistent with any other
provision, or to make any other provisions with respect to matters or questions
arising under the Trust Agreement, which shall not be inconsistent with the
other provisions of the Trust Agreement, or (ii) to modify, eliminate or add to
any provisions of the Trust Agreement to such extent as shall be necessary to
ensure that the Trust will be classified for United States federal income tax
purposes as a grantor trust at all times that any Trust Securities are
outstanding or to ensure that the Trust will not be required to register as an
"investment company" under the Investment Company Act; provided, however, that
such action shall not adversely affect in any material respect the interests of
the holders of the Trust Securities. Any amendments of the Trust Agreement
pursuant to the foregoing shall become effective when notice thereof is given to
the holders of the Trust Securities. The Trust Agreement may be amended by the
Issuer Trustees and the Corporation (i) with the consent of holders representing
a majority (based upon Liquidation Amount) of the outstanding Trust Securities
and (ii) upon receipt by the Issuer Trustees of an opinion of counsel
experienced in such matters to the effect that such amendment or the exercise of
any power granted to the Issuer Trustees in accordance with such amendment will
not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an "investment
company" under the Investment Company Act, provided that, without the consent of
each holder of Trust Securities, the Trust Agreement may not be amended to (i)
change the amount or timing of any Distribution on the Trust Securities or
reduce the amount payable on redemption thereof or otherwise adversely affect
the amount of any Distribution required to be made in respect of the Trust
Securities as of a specified date or (ii) restrict the right of a holder of
Trust Securities to institute suit for the enforcement of any such payment on or
after such date.
So long as any Junior Subordinated Debentures are held by the Property
Trustee, the Issuer Trustees shall not (i) direct the time, method and place of
conducting any proceeding for
46
<PAGE>
any remedy available to the Debenture Trustee, or execute any trust or power
conferred on the Property Trustee with respect to the Junior Subordinated
Debentures, (ii) waive certain past defaults under the Indenture, (iii) exercise
any right to rescind or annul a declaration of acceleration of the maturity of
the principal of the Junior Subordinated Debentures or (iv) consent to any
amendment, modification or termination of the Indenture or the Junior
Subordinated Debentures, where such consent shall be required, without, in each
case, obtaining the prior approval of the holders of a majority in Liquidation
Amount of all outstanding Trust Preferred Securities; provided, however, that
where a consent under the Indenture would require the consent of each holder of
Junior Subordinated Debentures affected thereby, no such consent shall be given
by the Property Trustee without the prior approval of each holder of the Trust
Preferred Securities. The Issuer Trustees shall not revoke any action previously
authorized or approved by a vote of the holders of the Trust Preferred
Securities except by subsequent vote of such holders. The Property Trustee shall
notify each holder of Trust Preferred Securities of any notice of default with
respect to the Junior Subordinated Debentures. In addition to obtaining the
foregoing approvals of such holders of the Trust Preferred Securities, prior to
taking any of the foregoing actions, the Issuer Trustees shall obtain an opinion
of counsel experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation for United States federal
income tax purposes on account of such action.
Any required approval of holders of Trust Preferred Securities may be given
at a meeting of such holders convened for such purpose or pursuant to written
consent. The Property Trustee will cause a notice of any meeting at which
holders of Trust Preferred Securities are entitled to vote, or of any matter
upon which action by written consent of such holders is to be taken, to be given
to each holder of record of Trust Preferred Securities in the manner set forth
in the Trust Agreement.
No vote or consent of the holders of Trust Preferred Securities will be
required for the Trust to redeem and cancel the Trust Preferred Securities in
accordance with the Trust Agreement.
Notwithstanding that holders of the Trust Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Trust Preferred Securities that are owned by the Corporation, the Trustees or
any affiliate of the Corporation or any Trustees, shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
Global Trust Preferred Securities
The Trust Preferred Securities will be represented by one or more global
certificates registered in the name of the Depository or its nominee ("Global
Trust Preferred Security"). Beneficial interests in the Trust Preferred
Securities will be shown on, and transfer thereof will be effected only through,
records maintained by persons that have accounts with such Depositary
("Participants"). Except as described below, Trust Preferred Securities in the
certificated form will not be issued in exchange for the global certificates.
See "Book-Entry Issuance."
47
<PAGE>
A global security shall be exchangeable for Trust Preferred Securities
registered in the names of persons other than the Depositary or its nominee only
if (i) the Depositary notifies the Corporation that is unwilling or unable to
continue as a depositary for such global security and no successor depositary
shall have been appointed, or if at any time the Depositary ceases to be a
clearing agency registered under the Exchange Act, at a time when the Depository
is required to be so registered to act as such depository, (ii) the Trust in its
sole discretion determines that such global security shall be so exchangeable,
or (iii) there shall have occurred and be continuing an Event of Default under
the Indenture. Any global security that is exchangeable pursuant to the
preceding sentence shall be exchangeable for definitive certificates registered
in such names as the Depositary shall direct. It is expected that such
instructions will be based upon directions received by the Depositary with
respect to ownership of beneficial interests in such global security. In the
event that Trust Preferred Securities are issued in definitive form, such Trust
Preferred Securities will be in denominations of $25 and integral multiples
thereof and may be transferred or exchanged at the offices described below.
Unless and until it is exchanged in whole or in part for the individual
Trust Preferred Securities represented thereby, a Global Trust Preferred
Security may not be transferred except as a whole by the Depositary to a nominee
of such Depositary or by a nominee of such Depositary to such Depositary or
another nominee of such Depositary or by the Depositary or any nominee to a
successor Depositary or any nominee of such successor.
Payments on Trust Preferred Securities represented by a global security
will be made to the Depositary, as the depositary for the Trust Preferred
Securities. In the event the Trust Preferred Securities are issued in definitive
form, Distributions will be payable, the transfer of the Trust Preferred
Securities will be registrable, and Trust Preferred Securities will be
exchangeable for Trust Preferred Securities of other denominations of a like
aggregate Liquidation Amount, at the corporate office of the Property Trustee,
or at the offices of any paying agent or transfer agent appointed by the
Administrative Trustees by check mailed to the address of the persons entitled
thereto or by wire transfer. For a description of the terms of the depositary
arrangements relating to payments, transfers, voting rights, redemptions and
other notices and other manners, see "Book-Entry Issuance."
Upon the issuance of a Global Trust Preferred Security, and the deposit of
such Global Trust Preferred Security with or on behalf of the Depositary, the
Depositary for such Global Trust Preferred Security or its nominee will credit,
on its book-entry registration and transfer system, the respective aggregate
Liquidation Amounts of the individual Trust Preferred Securities represented by
such Global Trust Preferred Securities to the accounts of Participants. Such
accounts shall be designated by the dealers, underwriters or agents with respect
to such Trust Preferred Securities. Ownership of beneficial interests in a
Global Trust Preferred Security will be limited to Participants or persons that
may hold interests through Participants. Ownership of beneficial interests in
such Global Trust Preferred Security will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the applicable
Depositary or its nominee (with respect to interests of Participants) and the
records of Participants (with respect to interests of persons who hold through
Participants). The laws of some states require that
48
<PAGE>
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interest in a Global Trust Preferred Security.
So long as the Depositary for a Global Trust Preferred Security, or its
nominee, is the registered owner of such Global Trust Preferred Security, such
Depositary or such nominee, as the case may be, will be considered the sole
owner or holder of the Trust Preferred Securities represented by such Global
Trust Preferred Security for all purposes under the Trust Agreement governing
such Trust Preferred Securities. Except as provided below, owners of beneficial
interest in a Global Trust Preferred Security will not be entitled to have any
of the individual Trust Preferred Securities represented by such Global Trust
Preferred Security registered in their names, will not receive or be entitled to
receive physical delivery of any such Trust Preferred Securities in definitive
form and will not be considered the owners or holders thereof under the Trust
Agreement.
None of the Corporation, the Property Trustee, any Paying Agent (as defined
below), or the Securities Registrar (defined below) for such Trust Preferred
Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of the Global Trust Preferred Security representing such Trust
Preferred Securities or for maintaining supervising or reviewing any records
relating to such beneficial ownership interests.
The Corporation expects that the Depositary for Trust Preferred Securities
or its nominee, upon receipt of any payment of the Liquidation Amount or
Distributions in respect of a permanent Global Trust Preferred Security
immediately will credit Participants' accounts with payments in amounts
proportionate to their respective beneficial interest in the aggregate
Liquidation Amount of such Global Trust Preferred Security as shown on the
records of such Depositary or its nominee. The Corporation also expects that
payments by Participants to owners of beneficial interests in such Global Trust
Preferred Security held through such Participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name."
Such payments will be the responsibility of such Participants.
If the Depositary for the Trust Preferred Securities is at any time
unwilling, unable or ineligible to continue as depositary and a successor
depositary is not appointed by the Corporation within 90 days, the Trust will
issue individual Trust Preferred Securities in exchange for the Global Trust
Preferred Security. In addition, the Trust may at any time and in its sole
discretion, subject to any limitations described herein relating to such Trust
Preferred Securities, determine not to have any Trust Preferred Securities
represented by one or more Global Trust Preferred Securities and, in such event,
will issue individual Trust Preferred Securities in exchange for the Global
Trust Preferred Security or Securities representing the Trust Preferred
Securities. Further, if the Trust so specifies with respect to the Trust
Preferred Securities, an owner of a beneficial interest in a Global Trust
Preferred Security representing the Trust Preferred Securities may, on terms
acceptable to the Trust, the Property Trustee and the Depositary for such Global
Trust
49
<PAGE>
Preferred Security, receive individual Trust Preferred Securities in exchange
for such beneficial interests, subject to any limitations described herein. In
any such instance, an owner of a beneficial interest in a Global Trust Preferred
Security will be entitled to physical delivery of individual Trust Preferred
Securities represented by such Global Trust Preferred Security equal in
Liquidation Amount to such beneficial interest and to have such Trust Preferred
Securities registered in its name. Individual Trust Preferred Securities so
issued will be issued in denominations, unless otherwise specified by the
Corporation, of $25 and integral multiples thereof.
Payment and Paying Agency
Payments in respect of the Trust Preferred Securities held in global form
shall be made to the Depositary, which shall credit the relevant accounts at the
Depositary on the applicable Distribution Dates, or in respect of the Trust
Preferred Securities that are not held by the Depositary, such payments shall be
made by check mailed to the address of the holder entitled thereto as such
address shall appear on the register. The paying agent (the "Paying Agent")
shall initially be the Property Trustee and any co-paying agent chosen by the
Property Trustee and acceptable to the Administrative Trustees and the
Corporation. The Paying Agent shall be permitted to resign as Paying Agent upon
30 days' written notice to the Property Trustee, the Administrative Trustees and
the Corporation. In the event that the Property Trustee shall no longer be the
Paying Agent, the Administrative Trustees shall appoint a successor (which shall
be a bank or trust company acceptable to the Administrative Trustees and the
Corporation) to act as Paying Agent.
Registrar and Transfer Agent
The Property Trustee will act as registrar and transfer agent for the Trust
Preferred Securities. Registration of transfers of the Trust Preferred
Securities will be effected without charge by or on behalf of the Trust, but
upon payment of any tax or other governmental charges that may be imposed in
connection with any transfer or exchange. The Trust will not be required to
register or cause to be registered the transfer of the Trust Preferred
Securities after they have been called for redemption.
Information Concerning the Property Trustee
The Property Trustee, other than during the occurrence and continuance of
an Event of Default, undertakes to perform only such duties as are specifically
set forth in the Trust Agreement and, during the existence of an Event of
Default, must exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Trust Agreement at the request of any holder of Trust
Securities unless it is offered reasonable indemnity against the costs, expenses
and liabilities that might be incurred thereby. If no Event of Default has
occurred and is continuing and the Property Trustee is required to decide
between alternative causes of action, construe ambiguous provisions in the
50
<PAGE>
Trust Agreement or is unsure of the application of any provision of the Trust
Agreement, and the matter is not one on which holders of the Trust Securities
are entitled under the Trust Agreement to vote, then the Property Trustee shall
take such action as is directed by the Corporation and, if not so directed,
shall take such action as it deems advisable and in the best interests of the
holders of the Trust Securities and will have no liability except for its own
bad faith, negligence or willful misconduct.
Miscellaneous
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Trust in such a way that the Trust will not be
deemed to be an "investment company" required to be registered under the
Investment Company Act or classified as an association taxable as a corporation
for United States federal income tax purposes and so that the Junior
Subordinated Debentures will be treated as indebtedness of the Corporation for
United States federal income tax purposes. In this connection, the Corporation
and the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of the Trust or the
Trust Agreement, that the Corporation and the Administrative Trustees determine
in their discretion to be necessary or desirable for such purposes, as long as
such action does not materially adversely affect the interests of the holders of
the Trust Securities.
Holders of the Trust Securities have no preemptive or similar rights.
The Trust may not borrow money, issue debt, execute mortgages or pledge any
of its assets.
51
<PAGE>
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures are to be issued under an Indenture, as
supplemented from time to time (as so supplemented, the "Indenture"), between
the Corporation and The Bank of New York, as trustee (the "Debenture Trustee").
The Indenture will be qualified under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"). This summary of certain terms and
provisions of the Junior Subordinated Debentures and the Indenture does not
purport to be complete, and where reference is made to particular provisions of
the Indenture, such provisions, including the definitions of certain terms, some
of which are not otherwise defined herein, are qualified in their entirety by
reference to all of the provisions of the Indenture and those terms made a part
of the Indenture by the Trust Indenture Act. The form of the Indenture has been
filed as an Exhibit to the Registration Statement.
Concurrently with the issuance of the Trust Preferred Securities, the Trust
will invest the proceeds thereof, together with the consideration paid by the
Corporation for the Common Securities, in Junior Subordinated Debentures issued
by the Corporation. The Junior Subordinated Debentures will be issued as
unsecured debt under the Indenture.
General
The Junior Subordinated Debentures will bear interest at the annual rate of
____% of the principal amount thereof, payable quarterly in arrears on the __
day of March, June, September and December of each year (each, an "Interest
Payment Date"), commencing ___________, 1997, to the person in whose name each
Junior Subordinated Debenture is registered, subject to certain exceptions, on
the [first day of the month/fifteenth day of the month immediately preceding the
month] in which the relevant Interest Payment Date occurs. Notwithstanding the
above, in the event that either (i) Junior Subordinated Debentures are held by
the Property Trustee and the Trust Preferred Securities are no longer in
book-entry only form or (ii) the Junior Subordinated Debentures are not
represented by a Global Subordinated Debenture (as defined herein), the record
date for such payment shall be the first day of the month in which such payment
is made. The amount of each interest payment due with respect to the Junior
Subordinated Debentures will include amounts accrued through the date the
interest payment is due. It is anticipated that, until the liquidation, if any,
of the Trust, each Junior Subordinated Debenture will be held in the name of the
Property Trustee in trust for the benefit of the holders of the Trust Preferred
Securities. The amount of interest payable for any period will be computed on
the basis of a 360-day year of twelve 30-day months and, for any period of less
than a full calendar month, the number of days elapsed in such month. In the
event that any date on which interest is payable on the Junior Subordinated
Debentures is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay), except that if such
next succeeding Business Day falls in the next succeeding calendar year, then
such payment shall be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date. Accrued interest
that is not paid on the applicable Interest Payment Date will bear additional
interest on the amount thereof (to the extent permitted by law) at the rate per
annum of _____%
52
<PAGE>
thereof, compounded quarterly. The term "interest," as used herein, shall
include quarterly interest payments, interest on quarterly interest payments not
paid on the applicable Interest Payment Date and Additional Sums (as defined
below), as applicable.
The Junior Subordinated Debentures will mature on , 2027 (such date, as it
may be shortened as hereinafter described, the "Stated Maturity Date"). Such
date may be shortened once at any time by the Corporation to any date not
earlier than , 2002 subject to the Corporation having received prior approval of
the Federal Reserve if then required under applicable capital guidelines or
policies of the Federal Reserve. In the event that the Corporation elects to
shorten the Stated Maturity Date of the Junior Subordinated Debentures, it shall
give notice to the Indenture Trustee, and the Indenture Trustee shall give
notice of such shortening to the holders of the Junior Subordinated Debentures
no less than 90 days prior to the effectiveness thereof.
The Junior Subordinated Debentures will rank pari passu with all Other
Debentures and will be unsecured and will rank subordinate and junior in right
of payment to all Senior and Subordinated Indebtedness to the extent and in the
manner set forth in the Indenture. See "-- Subordination."
The Corporation is a holding company and almost all of the operating assets
of the Corporation are owned by the Corporation's subsidiary. The Corporation is
a legal entity separate and distinct from its subsidiary. Holders of Junior
Subordinated Debentures should look only to the Corporation for payments on the
Junior Subordinated Debentures. The principal sources of the Corporation's
income are dividends, interest and fees from its subsidiary. The Corporation
relies primarily on dividends from the Bank to meet its obligations for payment
of principal and interest on its corporate expenses. There are regulatory
limitations on the payment of dividends directly or indirectly to the
Corporation from the Bank. As of December 31, 1996, under applicable banking
statutes and the Bank's dividend policy, the total capital available for payment
of dividends by the Bank to the Corporation was approximately $24 million.
However, banking regulatory authorities have the power to prohibit any act,
including the payment of dividends, if such act would reduce bank capital to a
point that, in the opinion of such regulatory authorities, would render the Bank
undercapitalized and thus constitute an unsafe or unsound banking practice. In
addition, the Bank is subject to certain restrictions imposed by federal law on
any extensions of credit to, and certain other transactions with, the
Corporation and certain other affiliates, and on investments in stock or other
securities thereof. Such restrictions prevent the Corporation and such other
affiliates from borrowing from the Bank unless the loans are secured by various
types of collateral. Further, such secured loans, other transactions and
investments by the Bank is generally limited in amount as to the Corporation and
as to each of such other affiliates to 10% of the Bank's capital and surplus and
as to the Corporation and all of such other affiliates to an aggregate of 20% of
the Bank's capital and surplus.
Because the Corporation is a holding company, the right of the Corporation
to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability of
holders of the Trust Preferred Securities to benefit indirectly
53
<PAGE>
from such distribution), is subject to the prior claims of creditors of that
subsidiary (including depositors, in the case of the Bank), except to the extent
the Corporation may itself be recognized as a creditor of that subsidiary. At
December 31, 1996, the subsidiary of the Corporation had total liabilities
(excluding liabilities owed to the Corporation) of $1.0 billion. Accordingly,
the Junior Subordinated Debentures will be effectively subordinated to all
existing and future liabilities of the Corporation's subsidiary and all
liabilities of any future subsidiaries of the Corporation. The Indenture does
not limit the incurrence or issuance of other secured or unsecured debt of the
Corporation or any subsidiary, including Senior and Subordinated Indebtedness.
See "--Subordination."
Option to Extend Interest Payment Date
So long as no Debenture Event of Default has occurred and is continuing,
the Corporation will have the right under the Indenture to defer the payment of
interest on the Junior Subordinated Debentures at any time and from time to time
for a period not exceeding 20 consecutive quarterly periods with respect to each
Extension Period, provided that no Extension Period shall end on a date other
than an Interest Payment Date or extend beyond the Stated Maturity Date. At the
end of such Extension Period, the Corporation must pay all interest then accrued
and unpaid (together with interest thereon at the annual rate of _____%,
compounded quarterly, to the extent permitted by applicable law. During an
Extension Period, interest will continue to accrue and, if the Junior
Subordinated Debentures have been distributed to holders of the Trust Preferred
Securities, holders of Junior Subordinated Debentures (or holders of the Trust
Preferred Securities while Trust Preferred Securities are outstanding) will be
required to accrue such deferred interest income for United States federal
income tax purposes prior to the receipt of cash attributable to such income.
See "Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount."
During any such Extension Period, the Corporation may not (i) declare or
pay any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock,
(ii) make any payment of principal of, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Corporation (including any Other
Debentures) that rank pari passu with or junior in right of payment to the
Junior Subordinated Debentures or (iii) make any guarantee payments with respect
to any guarantee by the Corporation of the debt securities of any subsidiary of
the Corporation (including any Other Guarantees) if such guarantee ranks pari
passu with or junior in right of payment to the Junior Subordinated Debentures
(other than (a) dividends or distributions in shares of, or options, warrants or
rights to subscribe for or purchase shares of, common stock of the Corporation,
(b) any declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of the Corporation's capital stock, (e) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, and (f) purchases of common stock related to the
issuance of common stock or rights
54
<PAGE>
under any of the Corporation's benefit plans for its directors, officers or
employees or any of the Corporation's dividend reinvestment plans).
Prior to the termination of any such Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods, end on a
date other than an Interest Payment Date or extend beyond the Stated Maturity
Date. Upon the termination of any such Extension Period and the payment of all
amounts then due on any Interest Payment Date, the Corporation may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
The Corporation must give the Property Trustee, the Administrative Trustees and
the Debenture Trustee notice of its election of any Extension Period (or an
extension thereof) at least one Business Day prior to the earlier of (i) the
date the Distributions on the Trust Preferred Securities would have been payable
except for the election to begin or extend such Extension Period or (ii) the
date the Administrative Trustees are required to give notice to any securities
exchange or to holders of Trust Preferred Securities of the record date or the
date such Distributions are payable, but in any event not less than one Business
Day prior to such record date. The Debenture Trustee shall give notice of the
Corporation's election to begin or extend a new Extension Period to the holders
of the Trust Preferred Securities. There is no limitation on the number of times
that the Corporation may elect to begin an Extension Period.
Additional Sums
If the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a Tax Event, the Corporation will pay as
additional amounts on the Junior Subordinated Debentures such amounts
("Additional Sums") as shall be required so that the Distributions payable by
the Trust shall not be reduced as a result of any such additional taxes, duties
or other governmental charges.
Redemption
Subject to the Corporation having received prior approval of the Federal
Reserve, if then required under applicable capital guidelines or policies of the
Federal Reserve, the Junior Subordinated Debentures are redeemable prior to
maturity at the option of the Corporation (i) on or after , 2002, in whole at
any time or in part from time to time, or (ii) at any time in whole (but not in
part), upon the occurrence and during the continuance of a Special Event, in
each case at redemption price equal to the accrued and unpaid interest on the
Junior Subordinated Debentures so redeemed to the date fixed for redemption,
plus 100% of the principal amount thereof.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Junior Subordinated
Debentures to be redeemed at such holder's registered address. Unless the
Corporation defaults in payments of the redemption price,
55
<PAGE>
on and after the redemption date interest ceases to accrue on such Junior
Subordinated Debentures or portions thereof called for redemption.
If the Trust is required to pay additional taxes, duties or other
governmental charges as a result of a Tax Event, the Corporation will pay as
additional amounts on the Junior Subordinated Debentures the Additional Sums.
The Junior Subordinated Debentures will not be subject to any sinking fund.
Distribution upon Liquidation
As described under "Description of the Trust Preferred
Securities--Liquidation Distribution Upon Termination," under certain
circumstances involving the termination of the Trust, the Junior Subordinated
Debentures may be distributed to the holders of the Trust Preferred Securities
in liquidation of the Trust after satisfaction of liabilities to creditors of
the Trust as provided by applicable law. If distributed to holders of the Trust
Preferred Securities in liquidation, the Junior Subordinated Debentures will
initially be issued in the form of one or more global securities and the
Depositary or any successor depositary for the Trust Preferred Securities, will
act as depositary for the Junior Subordinated Debentures. It is anticipated that
the depositary arrangements for the Junior Subordinated Debentures would be
substantially identical to those in effect for the Trust Preferred Securities.
If the Junior Subordinated Debentures are distributed to the holders of Trust
Preferred Securities upon the liquidation of the Trust, the Corporation will use
its best efforts to list the Junior Subordinated Debentures on the Nasdaq
National Market or such other stock exchanges or automated quotation system, if
any, on which the Trust Preferred Securities are then listed or quoted. There
can be no assurance as to the market price of any Junior Subordinated Debentures
that may be distributed to the holders of Trust Preferred Securities.
Certain Covenants of the Corporation
If at any time (1) there shall have occurred any event of which the
Corporation has actual knowledge that (a) is, or with the giving of notice or
the lapse of time, or both, would be, a Debenture Event of Default and (b) in
respect of which the Corporation shall not have taken reasonable steps to cure,
(2) the Corporation shall be in default with respect to its payment of any
obligations under the Guarantee or (3) the Corporation shall have given notice
of its election of an Extension Period as provided in the Indenture and shall
not have rescinded such notice, and such Extension Period, or any extension
thereof, shall have commenced and be continuing, then the Corporation will not,
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Corporation's
capital stock, (ii) make any payment of principal, interest or premium, if any,
on or repay or repurchase or redeem any debt securities of the Corporation
(including Other Debentures) that rank pari passu with or junior in right of
payment to the Junior Subordinated Debentures or (iii) make any guarantee
payments with respect to any guarantee by the Corporation of the debt securities
of any subsidiary of the Corporation (including under Other Guarantees) if such
guarantee ranks pari
56
<PAGE>
passu or junior in right of payment to the Junior Subordinated Debentures (other
than (a) dividends or distributions in shares of, or options, warrants or rights
to subscribe for or purchase shares of, common stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a
stockholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Guarantee, (d) the purchase of fractional shares resulting
from a reclassification of the Corporation's capital stock, (e) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, and (f) purchases of common stock related to the
issuance of common stock or rights under any of the Corporation's benefit plans
for its directors, officers or employees or any of the Corporation's dividend
reinvestment plans).
So long as the Trust Securities remain outstanding, the Corporation also
will covenant (i) to directly or indirectly maintain 100% direct or indirect
ownership of the Common Securities, provided, however, that any permitted
successor of the Corporation under the Indenture may succeed to the
Corporation's ownership of such Common Securities, (ii) to use its reasonable
efforts to cause the Trust (a) to remain a business trust, except in connection
with the distribution of Junior Subordinated Debentures to the holders of Trust
Securities in liquidation of the Trust, the redemption of all of the Trust
Securities of the Trust, or certain mergers, consolidations or amalgamations,
each as permitted by the Trust Agreement, and (b) to otherwise continue to be
classified as a grantor trust for United States federal income tax purposes and
(iii) to use its reasonable efforts to cause each holder of Trust Securities to
be treated as owning an undivided beneficial interest in the Junior Subordinated
Debentures.
Subordination
In the Indenture, the Corporation has covenanted and agreed that any Junior
Subordinated Debentures issued thereunder will be subordinate and junior in
right of payment to all Senior and Subordinated Indebtedness to the extent
provided in the Indenture. Upon any payment or distribution of assets to
creditors upon any liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of the Corporation, the holders of Senior
and Subordinated Indebtedness will first be entitled to receive payment in full
of principal of all Allocable Amounts (as defined below) on such Senior and
Subordinated Indebtedness before the holders of Junior Subordinated Debentures
will be entitled to receive or retain any payment in respect thereof.
In the event of the acceleration of the maturity of Junior Subordinated
Debentures, the holders of all Senior and Subordinated Indebtedness outstanding
at the time of such acceleration will first be entitled to receive payment in
full of such amounts due thereon (including any amounts due upon acceleration)
before the holders of Junior Subordinated Debentures will be entitled to receive
or retain any payment in respect of the Junior Subordinated Debentures.
57
<PAGE>
No payments on account of principal, or interest, if any, in respect of the
Junior Subordinated Debentures may be made if there shall have occurred and be
continuing a default in any payment with respect to any Senior and Subordinated
Indebtedness, or an event of default with respect to any Senior and Subordinated
Indebtedness resulting in the acceleration of the maturity thereof, or if any
judicial proceeding shall be pending with respect to any such default.
"Allocable Amounts," when used with respect to any Senior and Subordinated
Indebtedness, means all amounts due or to become due on such Senior and
Subordinated Indebtedness less, if applicable, any amount which would have been
paid to, and retained by, the holders of such Senior and Subordinated
Indebtedness (whether as a result of the receipt of payments by the holders of
such Senior and Subordinated Indebtedness from the Corporation or any other
obligor thereon or from any holders of, or trustee in respect of, other
indebtedness that is subordinate and junior in right of payment to such Senior
and Subordinated Indebtedness pursuant to any provision of such indebtedness for
the payment over of amounts received on account of such indebtedness to the
holders of such Senior and Subordinated Indebtedness or otherwise) but for the
fact that such Senior and Subordinated Indebtedness is subordinated or junior in
right of payment to (or subject to a requirement that amounts received on such
Senior and Subordinated Indebtedness be paid over to obligees on) trade accounts
payable or accrued liabilities arising in the ordinary course of business.
"Indebtedness" shall mean with respect to any person, whether recourse is
to all or a portion of the assets of such person and whether or not contingent:
(i) every obligation of the any person for money borrowed; (ii) every obligation
of such person evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with the acquisition
of property, assets or businesses; (iii) every reimbursement obligation of such
person with respect to letters of credit, banker's acceptances or similar
facilities issued for the account of such person; (iv) every obligation of such
person issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business); (v) every capital lease obligation of such person;
(vi) all indebtedness of such person whether incurred on or prior to the date of
the Indenture or thereafter incurred, for claims in respect of derivative
products, including interest rate, foreign exchange rate and commodity forward
contracts, options and swaps and similar arrangements; and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another person
and all dividends of another person the payment of which, in either case, such
person has guaranteed or is responsible or liable, directly or indirectly, as
obligor or otherwise.
"Senior and Subordinated Indebtedness" means the principal of (and premium,
if any) and interest, if any (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Corporation
whether or not such claim for post-petition interest is allowed in such
proceeding), on Indebtedness of the Corporation whether incurred on or prior to
the date of the Indenture or thereafter incurred, unless in the instrument
creating or evidencing the same or pursuant to which the same is outstanding, it
is provided that such obligations are not superior in right of payment to the
Junior Subordinated Debentures or to other Indebtedness which is pari passu
with, or subordinated to, the Junior Subordinated Debentures; provided,
58
<PAGE>
however, that Senior and Subordinated Indebtedness shall not be deemed to
include (i) any Indebtedness of the Corporation which when incurred and without
respect to any election under section 1111(b) of the United States Bankruptcy
Code of 1978, as amended, was without recourse to the Corporation, (ii) any
Indebtedness of the Corporation to any of its subsidiaries, (iii) Indebtedness
to any employee of the Corporation, and (iv) any other debt securities issued
pursuant to the Indenture.
The Corporation is a holding company and almost all of the operating assets
of the Corporation are owned by the Corporation's subsidiary. The Corporation
relies primarily on dividends from the Bank to meet its corporate expenses. The
Corporation is a legal entity separate and distinct from its subsidiaries.
Holders of Junior Subordinated Debentures should look only to the Corporation
for payments on the Junior Subordinated Debentures. There are regulatory
limitations on the payment of dividends directly or indirectly to the
Corporation from the Bank. See "--General." In addition, the Bank is subject to
certain restrictions imposed by federal law on any extensions of credit to, and
certain other transactions with, the Corporation and certain other affiliates,
and on investments in stock or other securities thereof. Such restrictions
prevent the Corporation and such other affiliates from borrowing from the Bank
unless the loans are secured by various types of collateral. Further, such
secured loans, other transactions and investments by the Bank are generally
limited in amount as to the Corporation and as to each of such other affiliates
to 10% of the Bank's capital and surplus and as to the Corporation and all of
such other affiliates to an aggregate of 20% of the Bank's capital and surplus.
Accordingly, the Junior Subordinated Debentures will be effectively subordinated
to all existing and future liabilities of the Corporation's subsidiaries.
Because the Corporation is a holding company, the right of the Corporation
to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability of
holders of the Trust Preferred Securities to benefit indirectly from such
distribution), is subject to the prior claims of creditors of that subsidiary
(including depositors, in the case of the Bank), except to the extent the
Corporation may itself be recognized as a creditor of that subsidiary. At
December 31, 1996, the subsidiary of the Corporation had total liabilities
(excluding liabilities owed to the Corporation) of $1.0 billion. Accordingly,
the Junior Subordinated Debentures will be effectively subordinated to all
existing and future liabilities of the Corporation's subsidiary and all
liabilities of any future subsidiaries of the Corporation. The Indenture does
not limit the incurrence or issuance of other secured or unsecured debt of the
Corporation or any subsidiary, including Senior and Subordinated Indebtedness.
Denominations, Registration and Transfer
The Junior Subordinated Debentures will be represented by global
certificates registered in the name of the Depositary or its nominee ("Global
Subordinated Debenture"). Beneficial interests in the Junior Subordinated
Debentures will be shown on, and transfers thereof will be effected only
through, records maintained by the Depositary. Except as described below, Junior
Subordinated Debentures in certificated form will not be issued in exchange for
the global certificates. See "Book-Entry Issuance."
59
<PAGE>
Unless and until a Global Subordinated Debenture is exchanged in whole or
in part for the individual Junior Subordinated Debentures represented thereby,
it may not be transferred except as a whole by the Depositary for such Global
Subordinated Debenture to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor Depositary or any nominee of such
successor.
A global security shall be exchangeable for Junior Subordinated Debentures
registered in the names of persons other than the Depositary or its nominee only
if (i) the Depositary notifies the Corporation that it is unwilling or unable to
continue as a depositary for such global security and no successor shall have
been appointed, or if at any time the Depositary ceases to be a clearing agency
registered under the Exchange Act, at a time when the Depositary is required to
be so registered to act as such depositary, (ii) the Corporation in its sole
discretion determines that such global security shall be so exchangeable or
(iii) there shall have occurred and be continuing a Debenture Event of Default
with respect to such global security. Any global security that is exchangeable
pursuant to the preceding sentence shall be exchangeable for definitive
certificates registered in such names as the Depositary shall direct. It is
expected that such instructions will be based upon directions received by the
Depositary from its Participants with respect to ownership of beneficial
interests in such global security. In the event that Junior Subordinated
Debentures are issued in definitive form, such Junior Subordinated Debentures
will be in denominations of $25 and integral multiples thereof and may be
transferred or exchanged at the offices described below.
Payments on Junior Subordinated Debentures represented by a global security
will be made to the Depositary, as the depositary for the Junior Subordinated
Debentures. In the event Junior Subordinated Debentures will be registrable, and
Junior Subordinated Debentures will be exchangeable for Junior Subordinated
Debentures of other denominations of a like aggregate principal amount, at the
corporate office of the Debenture Trustee, or at the offices of any paying agent
or transfer agent appointed by the Corporation, provided that payment of
interest may be made at the option of the Corporation by check mailed to the
address of the persons entitled thereto or by wire transfer. In addition, if the
Junior Subordinated Debentures are issued in certificated form, the record dates
for payment of interest will be the first day of the month in which such payment
is to be made. For a description of the Depositary and the terms of the
depositary arrangements relating to payments, transfers, voting rights,
redemptions and other notices and other matters, see "Book-Entry Issuance."
The Corporation will appoint the Debenture Trustee as securities registrar
under the Indenture (the "Securities Registrar"). Junior Subordinated Debentures
may be presented for exchange as provided above, and may be presented for
registration of transfer (with the form of transfer endorsed thereon, or a
satisfactory written instrument of transfer, duly executed), at the office of
the Securities Registrar. 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, provided that the Corporation
maintains a transfer agent in the place of payment. The
60
<PAGE>
Corporation may at any time designate additional transfer agents with respect to
the Junior Subordinated Debentures.
In the event of any redemption, neither the Corporation nor the Debenture
Trustee shall be required to (i) issue, register the transfer of or exchange
Junior Subordinated Debentures during a period beginning at the opening of
business 15 days before the day of selection for redemption of Junior
Subordinated Debentures and ending at the close of business on the day of
mailing of the relevant notice of redemption or (ii) transfer or exchange any
Junior Subordinated Debentures so selected for redemption, except, in the case
of any Junior Subordinated Debentures being redeemed in part, any portion
thereof not to be redeemed.
Global Subordinated Debentures
Upon the issuance of the Global Subordinated Debenture and the deposit of
such Global Subordinated Debenture with or on behalf of the Depositary, the
Depositary for such Global Subordinated Debenture or its nominee will credit, on
its book-entry registration and transfer system, the respective principal
amounts of the individual Junior Subordinated Debentures represented by such
Global Subordinated Debenture to the accounts of persons that have accounts with
such Depositary ("Participants"). Ownership of beneficial interests in a Global
Subordinated Debenture will be limited to Participants or persons that may hold
interests through Participants. Ownership of beneficial interests in such Global
Subordinated Debenture will be shown on, and the transfer of that ownership will
be effected only through, records maintained by the applicable Depositary or its
nominee (with respect to interests of Participants). The laws of some states
require that certain purchasers of securities take physical delivery of such
securities in definitive form. Such limits and such laws may impair the ability
to transfer beneficial interests in a Global Subordinated Debenture.
So long as the Depositary for a Global Subordinated Debenture, or its
nominee, is the registered owner of such Global Subordinated Debenture, such
Depositary or such nominee, as the case may be, will be considered the sole
owner or holder of the Junior Subordinated Debentures represented by such Global
Subordinated Debenture for all purposes under the Indenture governing such
Junior Subordinated Debentures. Except as provided below, owners of beneficial
interests in a Global Subordinated Debenture will not be entitled to have any of
the individual Junior Subordinated Debentures represented by such Global
Subordinated Debenture registered in their names, will not receive or be
entitled to receive physical delivery of any such Junior Subordinated Debentures
in definitive form and will not be considered the owners or holders thereof
under the Indenture.
Payments of principal of and interest on individual Junior Subordinated
Debentures represented by a Global Subordinated Debenture registered in the name
of the Depositary or its nominee will be made to the Depositary or its nominee,
as the case may be, as the registered owner of the Global Subordinated Debenture
representing such Junior Subordinated Debentures. None of the Corporation, the
Debenture Trustee, any Paying Agent, or the Securities Registrar for such Junior
Subordinated Debentures will have any responsibility or liability for any aspect
61
<PAGE>
of the records relating to or payments made on account of beneficial ownership
interests of the Global Subordinated Debenture representing such Junior
Subordinated Debentures or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
The Corporation expects that the Depositary or its nominee, upon receipt of
any payment of principal or interest in respect of a permanent Global
Subordinated Debenture representing the Junior Subordinated Debentures,
immediately will credit Participants' accounts with payments in amounts
proportionate to their respective beneficial interest in the principal amount of
the Global Subordinated Debenture as shown on the records of such Depositary or
its nominee. The Corporation also expects that payments by Participants to
owners of beneficial interests in such Global Subordinated Debenture held
through such Participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name." Such payments will be
the responsibility of such Participants.
If the Depositary is at any time unwilling, unable or ineligible to
continue as depositary and a successor depositary is not appointed by the
Corporation with 90 days, the Corporation will issue individual Junior
Subordinated Debentures in exchange for the Global Subordinated Debenture. In
addition, the Corporation may at any time and in its sole discretion, determine
not to have the Junior Subordinated Debentures represented by one or more Global
Subordinated Debenture and, in such event, will issue individual Junior
Subordinated Debentures in exchange for the Global Subordinated Debenture.
Further, the Corporation so specifies with respect to the Junior Subordinated
Debentures, an owner of a beneficial interest in a Global Subordinated Debenture
representing Junior Subordinated Debentures may, on terms acceptable to the
Corporation, the Debenture Trustee and the Depositary for such Global
Subordinated Debenture, receive individual Junior Subordinated Debentures in
exchange for such beneficial interests. In any such instance, an owner of a
beneficial interest in a Global Subordinated Debenture will be entitled to
physical delivery of individual Junior Subordinated Debentures registered in its
name. Individual Junior Subordinated Debentures so issued will be issued in
denominations, unless otherwise specified by the Corporation, of $25 and
integral multiples thereof.
Payment and Paying Agents
Payment of principal of and any interest on Junior Subordinated Debentures
will be made at the office of the Debenture Trustee in the City of New York or
at the office of such Paying Agent or Paying Agents as the Corporation may
designate from time to time, except that at the option of the Corporation
payment of any interest may be made, except in the case of Junior Subordinated
Debentures in global form, (i) by check mailed to the address of the Person
entitled thereto as such address shall appear in the register for Junior
Subordinated Debentures or (ii) by transfer to an account maintained by the
Person entitled thereto as specified in such register, provided that proper
transfer instructions have been received by the relevant Record Date. Payment of
any interest on any Junior Subordinated Debenture will be made to the Person in
whose name such Junior Subordinated Debenture is registered at the close of
business on the Record Date for such interest. The Corporation may at any time
designate additional Paying
62
<PAGE>
Agents or rescind the designation of any Paying Agent; however the Corporation
will at all times be required to maintain a Paying Agent in each place of
payment for the Junior Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any Paying Agent, or
then held by the Corporation in trust, for the payment of the principal of or
interest on any Junior Subordinated Debenture and remaining unclaimed for two
years after such principal or interest has become due and payable shall, at the
request of the Corporation, be repaid to the Corporation and the holder of such
Junior Subordinated Debenture shall thereafter look, as a general unsecured
creditor, only to the Corporation for payment thereof.
Modification of Indenture
From time to time the Corporation and the Debenture Trustee may, without
the consent of the holders of Junior Subordinated Debentures, amend, waive or
supplement the Indenture for specified purposes, including, among other things,
curing ambiguities, defects or inconsistencies (provided that any such action
does not materially adversely affect the interest of the holders of Junior
Subordinated Debentures), and qualifying, or maintaining the qualification of,
the Indenture under the Trust Indenture Act. The Indenture contains provisions
permitting the Corporation and the Debenture Trustee, with the consent of the
holders of a majority in principal amount of Junior Subordinated Debentures, to
modify the Indenture in a manner affecting the rights of the holders of Junior
Subordinated Debentures; provided that no such modification may, without the
consent of the holders of each outstanding Junior Subordinated Debenture so
affected, (i) change the Stated Maturity Date, or reduce the principal amount of
the Junior Subordinated Debentures or reduce the rate or extend the time of
payment of interest thereon except pursuant to the Corporation's right under the
Indenture to defer the payment of interest as provided therein (see "--Option to
Extend Interest Payment Date") or make the principal of, or interest on, the
Junior Subordinated Debentures payable in any coin or currency other than U.S.
dollars, or impair or affect the right of any holder of Junior Subordinated
Debentures to institute suit for the payment thereof, or (ii) reduce the
percentage of principal amount of Junior Subordinated Debentures, the holders of
which are required to consent to any such modification of the Indenture,
provided that so long as any of the Trust Preferred Securities remain
outstanding, no such modification may be made that adversely affects the holders
of such Trust Preferred Securities in any material respect, and no termination
of the Indenture may occur, and no waiver of any Debenture Event of Default or
compliance with any covenant under the Indenture may be effective, without the
prior consent of the holders of at least a majority of the aggregate Liquidation
Amount of the Trust Preferred Securities unless and until the principal of the
Junior Subordinated Debentures and all accrued and unpaid interest thereon have
been paid in full and certain other conditions are satisfied. Where a consent
under the Indenture would require the consent of each holder of Junior
Subordinated Debentures, no such consent shall be given by the Property Trustee
without the prior consent of each holder of Trust Preferred Securities. In
addition, the Corporation and the Debenture Trustee may execute, without the
consent of any holder of Junior Subordinated Debentures, any supplemental
Indenture for the purpose of creating any new series of Junior Subordinated
Debentures.
63
<PAGE>
Debenture Events of Default
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures constitutes a
"Debenture Event of Default" (whatever the reason for such Debenture Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) failure for 30 days to pay any interest on the Junior Subordinated
Debentures or any other Debentures, when due (subject to the deferral of any due
date in the case of an Extension Period); or
(ii) failure to pay any principal on the Junior Subordinated Debentures or
any other Debentures when due whether at maturity, upon redemption, by
declaration of acceleration of maturity or otherwise; or
(iii) failure to observe or perform in any material respect certain other
covenants contained in the Indenture for 90 days after written notice to the
Corporation from the Debenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of Junior Subordinated Debentures; or
(iv) certain events of bankruptcy, insolvency or reorganization of the
Corporation.
The holders of a majority in aggregate outstanding principal amount of the
Junior Subordinated Debentures have, subject to certain exceptions, the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Debenture Trustee. The Debenture Trustee or the holders of not
less than 25% in aggregate outstanding principal amount of the Junior
Subordinated Debentures may declare the principal due and payable immediately
upon a Debenture Event of Default. If the Debenture Trustee or such holders of
such Junior Subordinated Debentures fail to make such declaration, the holders
of at least 25% in the aggregate Liquidation Amount of the Trust Preferred
Securities shall have such right. The holders of a majority in aggregate
outstanding principal amount of the Junior Subordinated Debentures may annul
such declaration and waive the default if the default (other than the
non-payment of the principal of the Junior Subordinated Debentures which has
become due solely by such acceleration) has been cured and a sum sufficient to
pay all matured installments of interest and principal due otherwise than by
acceleration has been deposited with the Debenture Trustee. Should the holders
of the Junior Subordinated Debentures fail to annul such declaration and waive
such default, the holders of a majority in aggregate Liquidation Amount of the
Trust Preferred Securities shall have such right.
The holders of a majority in aggregate outstanding principal amount of the
Junior Subordinated Debentures affected thereby may, on behalf of the holders of
all the Junior Subordinated Debentures, waive any past default, except a default
in the payment of principal on or interest (unless such default has been cured
and a sum sufficient to pay all matured installments of interest and principal
due otherwise than by acceleration has been deposited with the Debenture
Trustee) or a default in respect of a covenant or provision which under the
Indenture cannot be modified or amended without the consent of the holder of
each outstanding Junior Subordinated Debenture.
64
<PAGE>
In case a Debenture Event of Default shall occur and be continuing as to
Junior Subordinated Debentures, the Property Trustee will have the right to
declare the principal of and the interest on such Junior Subordinated
Debentures, and any other amounts payable under the Indenture, to be forthwith
due and payable and to enforce its other rights as a creditor with respect to
such Junior Subordinated Debentures.
The Indenture requires the annual filing by the Corporation with the
Debenture Trustee of a certificate as to the absence of certain defaults under
the Indenture.
Enforcement of Certain Rights by Holders of Trust Preferred Securities
If a Debenture Event of Default shall have occurred and be continuing and
shall be attributable to the failure of the Corporation to pay the principal of
or interest on the Junior Subordinated Debentures on the due date, a holder of
Trust Preferred Securities may institute a Direct Action. The Corporation may
not amend the Indenture to remove the foregoing right to bring a Direct Action
without the prior written consent of the holders of all of the Trust Preferred
Securities. If the right to bring a Direct Action is removed, the Trust may
become subject to the reporting obligations under the Exchange Act.
Notwithstanding any payments made to a holder of Trust Preferred Securities by
the Corporation in connection with a Direct Action, the Corporation shall remain
obligated to pay the principal of or interest on the Junior Subordinated
Debentures, and the Corporation shall be subrogated to the rights of the holder
of such Trust Preferred Securities with respect to payments on the Trust
Preferred Securities to the extent of any payments made by the Corporation to
such holder in any Direct Action.
The holders of the Trust Preferred Securities will not be able to exercise
directly any remedies, other than those set forth in the preceding paragraph,
available to the holders of the Junior Subordinated Debentures unless there
shall have been an Event of Default under the Trust Agreement. See "Description
of Trust Preferred Securities--Events of Default; Notice."
Consolidation, Merger, Sale of Assets and Other Transactions
The Indenture provides that the Corporation shall not consolidate with or
merge into any other Person or convey, transfer or lease its properties as an
entirety or substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Corporation or convey, transfer or lease its
properties as an entirety or substantially as an entirety to the Corporation,
unless: (i) in case the Corporation consolidates with or merges into another
Person or conveys or transfers its properties substantially as an entirety to
any Person, the successor Person is organized under the laws of the United
States or any State or the District of Columbia, and such successor Person
expressly assumes the Corporation's obligations on the Junior Subordinated
Debentures; (ii) immediately after giving effect thereto, no Debenture Event of
Default, and no event which, after notice or lapse of time or both, would become
a Debenture Event of Default, shall have occurred and be continuing; and (iii)
certain other conditions as prescribed in the Indenture are met.
65
<PAGE>
The general provisions of the Indenture do not afford holders of the Junior
Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Corporation that may adversely affect holders of the
Junior Subordinated Debentures.
Satisfaction and Discharge
The Indenture provides that when, among other things, all Junior
Subordinated Debentures not previously delivered to the Debenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at maturity or called for redemption within one year, and the Corporation
deposits or causes to be deposited with the Debenture Trustee funds, in trust,
for the purpose and in an amount sufficient to pay and discharge the entire
indebtedness on the Junior Subordinated Debentures not previously delivered to
the Debenture Trustee for cancellation, for the principal and interest to the
Stated Maturity Date, then the Indenture will cease to be of further effect
(except as to the Corporation's obligations to pay all other sums due pursuant
to the Indenture and to provide the officers' certificates and opinions of
counsel described therein), and the Corporation will be deemed to have satisfied
and discharged the Indenture.
Covenants of the Corporation
The Corporation will covenant in the Indenture, as to the Junior
Subordinated Debentures, that if and so long as (i) the Trust is the holder of
all such Junior Subordinated Debentures, (ii) a Tax Event in respect of the
Trust has occurred and is continuing and (iii) the Corporation has elected, and
has not revoked such election, to pay Additional Sums (as defined under
"Description of the Trust Preferred Securities--Redemption") in respect of the
Trust Preferred Securities, the Corporation will pay to the Trust such
Additional Sums. The Corporation will also covenant, as to the Junior
Subordinated Debentures, (i) to maintain directly or indirectly 100% ownership
of the Common Securities of the Trust to which Junior Subordinated Debentures
have been issued, provided that certain successors which are permitted pursuant
to the Indenture may succeed to the Corporation's ownership of the Common
Securities, (ii) not to voluntarily terminate, wind up or liquidate the Trust
except as prior approval of the Federal Reserve if then so required under
applicable capital guidelines or policies of the Federal Reserve, and except (a)
in connection with a distribution of Junior Subordinated Debentures to the
holders of the Trust Preferred Securities in liquidation of the Trust or (b) in
connection with certain mergers, consolidations, or amalgamations permitted by
the Trust Agreement and (iii) to use its reasonable efforts, consistent with the
terms and provisions of the Trust Agreement, to cause the Trust to remain
classified as a grantor trust and not as an association taxable as a corporation
for United States federal income tax purposes.
66
<PAGE>
Governing Law
The Indenture and the Junior Subordinated Debentures will be governed by
and construed in accordance with the laws of the State of New York.
Information Concerning the Debenture Trustee
The Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Debenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of Junior Subordinated Debentures, unless offered
reasonable indemnity by such holder against the costs, expenses and liabilities
which might be incurred thereby. The Debenture Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Debenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.
67
<PAGE>
DESCRIPTION OF GUARANTEE
The Guarantee will be executed and delivered by the Corporation
concurrently with the issuance by the Trust of the Trust Preferred Securities
for the benefit of the holders from time to time of the Trust Preferred
Securities. The Bank of New York will act as Guarantee Trustee under the
Guarantee for purposes of compliance with the Trust Indenture Act, and the
Guarantee will be qualified as an Indenture under the Trust Indenture Act. This
summary of certain provisions of the Guarantee does not purport to be complete
and is subject to, and qualified in its entirety by reference to, all of the
provisions of the Guarantee, including the definitions therein of certain terms,
and the Trust Indenture Act. The form of the Guarantee has been filed as an
exhibit to the Registration Statement of which this Prospectus forms a part. The
Guarantee Trustee will hold the Guarantee for the benefit of the holders of the
Trust Preferred Securities.
General
The Guarantee will be an irrevocable guarantee on a subordinated basis of
the Trust's obligations under the Trust Preferred Securities, but will apply
only to the extent that the Trust has funds sufficient to make such payments,
and is not a guarantee of collection.
The Corporation will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined below)
to the holders of the Trust Preferred Securities, as and when due, regardless of
any defense, right of set-off or counterclaim that the Trust may have or assert
other than the defense of payment. The following payments with respect to the
Trust Preferred Securities, to the extent not paid by or on behalf of the Trust
(the "Guarantee Payments"), will be subject to the Guarantee: (i) any
accumulated and unpaid Distributions required to be paid on the Trust Preferred
Securities, to the extent that the Trust has funds on hand legally available
therefor at such time, (ii) the applicable redemption price with respect to the
Trust Preferred Securities called for redemption, to the extent that the Trust
has funds on hand legally available therefor at such time, and (iii) upon a
voluntary or involuntary dissolution, winding-up or liquidation of the Trust
(other than in connection with the distribution of the Junior Subordinated
Debentures to holders of the Trust Preferred Securities or the redemption of all
Trust Preferred Securities), the lesser of (a) the Liquidation Distribution, to
the extent the Trust has funds legally available therefor at the time, and (b)
the amount of assets of the Trust remaining available for distribution to
holders of Trust Preferred Securities after satisfaction of liabilities to
creditors of the Trust as required by applicable law. The Corporation's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Corporation to the holders of the Trust Preferred
Securities or by causing the Trust to pay such amounts to such holders.
If the Corporation does not make interest payments on the Junior
Subordinated Debentures held by the Trust, the Trust will not be able to pay
Distributions on the Trust Preferred Securities and will not have funds legally
available therefor. The Guarantee will rank subordinate and junior in right of
payment to all Senior and Subordinated Indebtedness to the extent provided
therein. See "--Status of the Guarantee." Because the Corporation is a holding
company, the right of the Corporation to participate in any distribution of
assets of any subsidiary upon such
68
<PAGE>
subsidiary's liquidation or reorganization or otherwise is subject to the prior
claims of creditors of that subsidiary, except to the extent the Corporation may
itself be recognized as a creditor of that subsidiary. Accordingly, the
Corporation's obligations under the Guarantee effectively will be subordinated
to all existing and future liabilities of the Corporation's subsidiary and all
liabilities of any future subsidiaries of the Corporation. Claimants should look
only to the assets of the Corporation for payments under the Guarantee. See
"Description of the Junior Subordinated Debentures--General." The Guarantee does
not limit the incurrence or issuance of other secured or unsecured debt of the
Corporation, including Senior and Subordinated Indebtedness, whether under the
Indenture, any other indenture that the Corporation may enter into in the future
or otherwise.
The Corporation will, through the Guarantee, the Trust Agreement, the
Junior Subordinated Debentures and the Indenture, taken together, fully,
irrevocably and unconditionally guarantee all of the Trust's obligations under
the Trust Preferred Securities. No single document standing alone or operating
in conjunction with fewer than all of the other documents constitutes such
guarantee. It is only the combined operation of these documents that has the
effect of providing a full, irrevocable and unconditional guarantee of the
Trust's obligations under the Trust Preferred Securities. See "Relationship
Among the Trust Preferred Securities, the Junior Subordinated Debentures and the
Guarantee."
Status of the Guarantee
The Guarantee will constitute an unsecured obligation of the Corporation
and will rank subordinate and junior in right of payment to all Senior and
Subordinated Indebtedness in the same manner as the Junior Subordinated
Debentures.
The Guarantee will constitute a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Corporation to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity). The
Guarantee will be held for the benefit of the holders of the Trust Preferred
Securities. The Guarantee will not be discharged except by payment of the
Guarantee Payments in full to the extent not paid by the Trust or upon
distribution to the holders of the Trust Preferred Securities of the Junior
Subordinated Debentures. The Guarantee does not place a limitation on the amount
of additional Senior and Subordinated Indebtedness that may be incurred by the
Corporation.
Events of Default
An event of default under the Guarantee will occur upon the failure of the
Corporation to perform any of its payment or other obligations thereunder. The
holders of not less than a majority in aggregate Liquidation Amount of the Trust
Preferred Securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under the Guarantee.
69
<PAGE>
Any holder of the Trust Preferred Securities may institute a legal
proceeding directly against the Corporation to enforce its rights under the
Guarantee without first instituting a legal proceeding against the Trust, the
Guarantee Trustee or any other person or entity.
The Corporation, as guarantor, will be required to file annually with the
Guarantee Trustee a certificate as to whether or not the Corporation is in
compliance with all the conditions and covenants applicable to it under the
Guarantee.
Amendments and Assignment
Except with respect to any changes that do not materially adversely affect
the rights of holders of the Trust Preferred Securities (in which case no vote
will be required), the Guarantee may not be amended without the prior approval
of the holders of a majority of the aggregate Liquidation Amount of such
outstanding Trust Preferred Securities. The manner of obtaining any such
approval will be as set forth under "Description of Trust Preferred
Securities--Voting Rights; Amendment of the Trust Agreement." All guarantees and
agreements contained in the Guarantee Agreement shall bind the successors,
assigns, receivers, trustees and representatives of the Corporation and shall
inure to the benefit of the holders of the Trust Preferred Securities then
outstanding.
Termination of the Guarantee
The Guarantee will terminate and be of no further force and effect upon
full payment of the redemption price of the Trust Preferred Securities, upon
full payment of the Liquidation Amount payable upon liquidation of the Trust or
upon distribution of Junior Subordinated Debentures to the holders of the Trust
Preferred Securities. The Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any holder of the Trust Preferred
Securities must restore payment of any sums paid under the Trust Preferred
Securities or the Guarantee.
Information Concerning the Guarantee Trustee
The Guarantee Trustee, other than during the occurrence and continuance of
a default by the Corporation in performance of the Guarantee, will undertake to
perform only such duties as are specifically set forth in the Guarantee and, in
case a default with respect to the Guarantee has occurred, must exercise the
same degree of care and skill as a prudent person would exercise or use in the
conduct of his or her own affairs. Subject to this provision, the Guarantee
Trustee will be under no obligation to exercise any of the powers vested in it
by the Guarantee at the request of any holder of the Trust Preferred Securities
unless it is offered reasonable indemnity against the costs, expenses and
liabilities that might be incurred thereby.
Governing Law
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
70
<PAGE>
BOOK-ENTRY ISSUANCE
The Depositary will act as securities depositary for all of the Trust
Preferred Securities and the Junior Subordinated Debentures. The Trust Preferred
Securities and the Junior Subordinated Debentures will be issued only as
fully-registered securities registered in the name of Cede & Co. (the
Depositary's nominee). One or more fully-registered global certificates will be
issued for the Trust Preferred Securities and the Junior Subordinated Debentures
and will be deposited with the Depositary.
The Depositary is a limited purpose trust company organized under the New
York Banking Law, as "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. The Depositary holds securities that its Participants deposit with the
Depositary. The Depositary also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
"Direct Participants" include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations. The Depositary
is owned by a number of its Direct Participants and by the New York Stock
Exchange, Inc., the American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc. Access to the Depositary system is also available to
others such as securities brokers and dealers, banks and trust companies that
clear through or maintain custodial relationships with Direct Participants,
either directly or indirectly ("Indirect Participants"). The rules applicable to
the Depositary and its Participants are on file with the Commission.
Purchases of Trust Preferred Securities or Junior Subordinated Debentures
within the Depositary system must be made by or through Direct Participants,
which will receive a credit for the Trust Preferred Securities or Junior
Subordinated Debentures on the Depositary's records. The ownership interest of
each actual purchaser of each Trust Preferred Securities and each Subordinated
Debenture ("Beneficial Owner") is in turn to be recorded on the Direct and
Indirect Participants' records. Beneficial Owners will not receive written
confirmation from the Depositary of their purchases, but Beneficial Owners are
expected to receive written confirmations providing details of the transactions,
as well as periodic statements of their holdings, from the Direct or Indirect
Participants through which the Beneficial Owners purchased Trust Preferred
Securities or Junior Subordinated Debentures. Transfers of ownership interests
in the Trust Preferred Securities or Junior Subordinated Debentures are to be
accomplished by entries made on the books of Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Trust Preferred Securities or Junior Subordinated
Debentures, except in the event that use of the book-entry system for the Junior
Subordinated Debentures is discontinued.
The Depositary has no knowledge of the actual Beneficial Owners of the
Trust Preferred Securities or Junior Subordinated Debentures; the Depositary's
records reflect only the identity of the Direct Participants to whose accounts
such Trust Preferred Securities or Junior
71
<PAGE>
Subordinated Debentures are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by the Depositary to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners and the voting
rights of Direct Participants, Indirect Participants and Beneficial Owners will
be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Redemption notices will be sent to Cede & Co. as the registered holder of
the Trust Preferred Securities or Junior Subordinated Debentures. If less than
all of the Trust Preferred Securities or the Junior Subordinated Debentures are
being redeemed, the Depository will determine by lot or pro rata the amount of
the Trust Preferred Securities of each Direct Participant to be redeemed.
Although voting with respect to the Trust Preferred Securities or the
Junior Subordinated Debentures is limited to the holders of record of the Trust
Preferred Securities or Junior Subordinated Debentures, as applicable, in those
instances in which a vote is required, neither the Depositary nor Cede & Co.
will itself consent or vote with respect to Trust Preferred Securities or Junior
Subordinated Debentures. Under its usual procedures, the Depository would mail
an omnibus proxy (the "Omnibus Proxy") to the relevant Issuer Trustee as soon as
possible after the record date. The Omnibus Proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts such
Trust Preferred Securities or Junior Subordinated Debentures are credited on the
record date (identified in a listing attached to the Omnibus Proxy).
Distribution payments on the Trust Preferred Securities or the Junior
Subordinated Debentures will be made by the relevant Issuer Trustee to the
Depositary. The Depositary's practice is to credit Direct Participants' accounts
on the relevant payment date in accordance with their respective holdings shown
on the Depositary's records unless the Depositary has reason to believe that it
will not receive payments on such payment date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participant and not of the
Depositary, the relevant Issuer Trustee, the Trust or the Corporation, subject
to any statutory or regulatory requirements as may be in effect from time to
time. Payment of Distributions to the Depositary is the responsibility of the
relevant Issuer Trustee, disbursement of such payments to Direct Participants is
the responsibility of the Depositary, and disbursements of such payments to the
Beneficial Owners is the responsibility of Direct and Indirect Participants.
The Depositary may discontinue providing its services as securities
depositary with respect to any of the Trust Preferred Securities or the Junior
Subordinated Debentures at any time by giving reasonable notice to the relevant
Issuer Trustee and the Corporation. In the event that a successor securities
depositary is not obtained, definitive Trust Preferred Securities or
Subordinated Debentures certificates representing such Trust Preferred
Securities or Junior Subordinated Debentures are required to be printed and
delivered. The Corporation, at its option,
72
<PAGE>
may decide to discontinue use the system of book-entry transfers through the
Depositary (or a successor depositary). After a Debenture Event of Default, the
holders of a majority in liquidation preference of Trust Preferred Securities or
aggregate principal amount of Junior Subordinated Debentures may determine to
discontinue the system of book-entry transfers through the Depositary. In any
such event, definitive certificates for such Trust Preferred Securities or
Junior Subordinated Debentures will be printed and delivered.
The information in this section concerning the Depositary and the
Depositary's book-entry system has been obtained from sources that the Trust and
the Corporation believe to be accurate but the Trust and the Corporation assume
no responsibility for the accuracy thereof. Neither the Trust nor the
Corporation has any responsibility for the performance by the Depositary or its
Participants of their respective obligations as described herein or under the
rules and procedures governing their respective operations.
73
<PAGE>
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE
JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
Full and Unconditional Guarantee
Payments of Distributions and other amounts due on the Trust Preferred
Securities (to the extent the Trust has funds on hand legally available for the
payment of such Distributions) will be irrevocably guaranteed by the Corporation
as and to the extent set forth under "Description of Guarantee." Taken together,
the Corporation's obligations under the Junior Subordinated Debentures, the
Indenture, the Trust Agreement and the Guarantee will provide, in the aggregate,
a full, irrevocable and unconditional guarantee of payments of Distributions and
other amounts due on the Trust Preferred Securities. No single document standing
alone or operating in conjunction with fewer than all of the other documents
constitutes such guarantee. It is only the combined operation of these documents
that has the effect of providing a full, irrevocable and unconditional guarantee
of the Trust's obligations under the Trust Preferred Securities. If and to the
extent that the Corporation does not make the required payments on the Junior
Subordinated Debentures, the Trust will not have sufficient funds to make the
related payments, including Distributions, on the Trust Preferred Securities.
The Guarantee will not cover any such payment when the Trust does not have
sufficient funds on hand legally available therefor. In such event, the remedy
of a holder of Trust Preferred Securities is to institute a Direct Action. The
obligations of the Corporation under the Guarantee will be subordinate and
junior in right of payment to all Senior and Subordinated Indebtedness.
Sufficiency of Payments
As long as payments of interest and other payments are made when due on the
Junior Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Trust Preferred Securities,
primarily because: (i) the aggregate principal amount of the Junior Subordinated
Debentures will be equal to the sum of the aggregate Liquidation Amount of the
Trust Securities; (ii) the interest rate and interest and other payment dates on
the Junior Subordinated Debentures will match the Distribution rate and
Distribution and other payment dates for the Trust Securities; (iii) the
Corporation, as Sponsor, shall pay for all and any costs, expenses and
liabilities of the Trust except the Trust's obligations to holders of Trust
Securities under such Trust Securities; and (iv) the Trust Agreement will
provide that the Trust is not authorized to engage in any activity that is not
consistent with the limited purposes thereof.
Enforcement Rights of Holders of Trust Preferred Securities
A holder of any Trust Preferred Security may institute a legal proceeding
directly against the Corporation to enforce its rights under the Guarantee
without first instituting a legal proceeding against the Guarantee Trustee, the
Trust or any other person or entity.
A default or event of default under any Senior and Subordinated
Indebtedness would not constitute a default or Event of Default under the Trust
Agreement. However, in the event of
74
<PAGE>
payment defaults under, or acceleration of, Senior Indebtedness, the
subordination provisions of the Indenture will provide that no payments may be
made in respect of the Junior Subordinated Debentures until such Senior and
Subordinated Indebtedness has been paid in full or any payment default
thereunder has been cured or waived. Failure to make required payments on Junior
Subordinated Debentures would constitute an Event of Default under the Trust
Agreement.
Limited Purpose of the Trust
The Trust Preferred Securities will represent beneficial interests in the
Trust, and the Trust exists for the sole purpose of issuing and selling the
Trust Securities, using the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures and engaging in only those other
activities necessary, advisable or incidental thereto. A principal difference
between the rights of a holder of a Trust Preferred Security and a holder of a
Junior Subordinated Debenture is that a holder of a Junior Subordinated
Debenture will be entitled to receive from the Corporation the principal amount
of and interest on Junior Subordinated Debentures held, while a holder of Trust
Preferred Securities is entitled to receive Distributions from the Trust (or, in
certain circumstances, from the Corporation under the Guarantee) if and to the
extent the Trust has funds on hand legally available for the payment of such
Distributions.
Rights Upon Termination
Unless the Junior Subordinated Debentures are distributed to holders of the
Trust Securities, upon any voluntary or involuntary termination, winding-up or
liquidation of the Trust, after satisfaction of the liabilities of creditors of
the Trust as required by applicable law, the holders of the Trust Preferred
Securities will be entitled to receive, out of assets held by the Trust, the
Liquidation Distribution in cash. See "Description of Trust Preferred Securities
Liquidation of the Trust and Distribution of Junior Subordinated Debentures."
Upon any voluntary or involuntary liquidation or bankruptcy of the Corporation,
the Property Trustee, as holder of the Junior Subordinated Debentures, would be
a subordinated creditor of the Corporation, subordinated in right of payment to
all Senior and Subordinated Indebtedness as set forth in the Indenture, but
entitled to receive payment in full of principal and interest, before any
stockholders of the Corporation receive payments or distributions. Since the
Corporation will be the guarantor under the Guarantee and will agree to pay for
all costs, expenses and liabilities of the Trust (other than the Trust's
obligations to the holders of its Trust Securities), the positions of a holder
of Trust Preferred Securities and a holder of Junior Subordinated Debentures
relative to other creditors and to stockholders of the Corporation in the event
of liquidation or bankruptcy of the Corporation are expected to be substantially
the same.
75
<PAGE>
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
General
In the opinion of Elias, Matz, Tiernan & Herrick, L.L.P., special federal
income tax counsel to the Corporation and the Trust ("Tax Counsel"), the
following is a summary of certain of the material United States federal income
tax consequences of the purchase, ownership and disposition of Trust Preferred
Securities held as capital assets by a holder who purchases such Trust Preferred
Securities upon initial issuance. It does not deal with special classes of
holders such as banks, thrifts, real estate investment trusts, regulated
investment companies, insurance companies, dealers in securities or currencies,
tax-exempt investors, United States Alien Holders (as defined below) engaged in
a U.S. trade or business or persons that will hold the Trust Preferred
Securities as a position in a "straddle," as part of a "synthetic security" or
"hedge," as part of a "conversion transaction" or other integrated investment,
or as other than a capital asset. This summary also does not address the tax
consequences to persons that have a functional currency other than the U.S.
dollar or the tax consequences to shareholders, partners or beneficiaries of a
holder of Trust Preferred Securities. Further, it does not include any
description of any alternative minimum tax consequences or the tax laws of any
state or local government or of any foreign government that may be applicable to
the Trust Preferred Securities. This summary is based on the Code, Treasury
regulations thereunder and the administrative and judicial interpretations
thereof, as of the date hereof, all of which are subject to change, possibly on
a retroactive basis. An opinion of Tax Counsel is not binding on the IRS or the
courts. No rulings have been or are expected to be sought from the IRS with
respect to any of the transactions described herein and no assurance can be
given that the IRS will not take contrary positions. Moreover, no assurance can
be given that the opinions expressed herein will not be challenged by the IRS
or, if challenged, that such a challenge would not be successful.
The United States federal income tax discussion set forth below is included
for general information only and may not be applicable depending upon a holder's
particular situation. Holders should consult their tax advisors with respect to
the tax consequences to them of the purchase, ownership and disposition of the
trust preferred securities, including the tax consequences under state, local,
foreign and other tax laws and the possible effects of changes in united states
federal or other tax laws.
Classification of the Junior Subordinated Debentures
In connection with the issuance of the Junior Subordinated Debentures, Tax
Counsel will render its opinion generally to the effect that, under then current
law and assuming full compliance with the terms of the Indenture (and certain
other documents), and based on certain facts and assumptions contained in such
opinion, the Junior Subordinated Debentures will be classified for United States
federal income tax purposes as indebtedness of the Corporation. The Corporation,
the Trust and the holders of the Trust Preferred Securities (by acceptance of a
beneficial interest in a Trust Preferred Security) will agree to treat the
Junior Subordinated Debentures as indebtedness of the Corporation for all United
States federal income tax purposes.
76
<PAGE>
Classification of the Trust
In connection with the issuance of the Trust Preferred Securities, Tax
Counsel will render its opinion generally to the effect that, under then current
law and assuming full compliance with the terms of the Trust Agreement and the
Indenture (and certain other documents), and based on certain facts and
assumptions contained in such opinion, the Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an association
taxable as a corporation. Accordingly, for United States federal income tax
purposes, each holder of Trust Preferred Securities generally will be considered
the owner of an undivided interest in the Junior Subordinated Debentures, and
each holder will be required to include in its gross income any interest (or OID
accrued) with respect to its allocable share of those Junior Subordinated
Debentures.
Interest Income and Original Issue Discount
Under recently issued Treasury regulations (the "Regulations") applicable
to debt instruments issued on or after August 13, 1996, a "remote" contingency
that stated interest will not be timely paid will be ignored in determining
whether a debt instrument is issued with OID. The Corporation believes that the
likelihood of its exercising its option to defer payments of interest is
"remote" since exercising that option would, among other things, prevent the
Corporation from declaring dividends on any class of its equity securities.
Accordingly, the Corporation intends to take the position, based on the advice
of Tax Counsel, that the Junior Subordinated Debentures will not be considered
to be issued with OID and, accordingly, stated interest on the Junior
Subordinated Debentures generally will be taxable to a holder as ordinary income
at the time it is paid or accrued in accordance with such holder's method of tax
accounting.
Under the Regulations, if the Corporation were to exercise its option to
defer payments of interest, the Junior Subordinated Debentures would at that
time be treated as issued with OID, and all stated interest on the Junior
Subordinated Debentures would thereafter be treated as OID as long as the Junior
Subordinated Debentures remain outstanding. In such event, all of a holder's
taxable interest income with respect to the Junior Subordinated Debentures would
thereafter be accounted for on an economic accrual basis regardless of such
holder's method of tax accounting, and actual distributions of stated interest
would not be reported as taxable income. Consequently, a holder of Trust
Preferred Securities would be required to include in gross income OID even
though the Corporation would not make actual cash payments during an Extension
Period. Moreover, under the Regulations, if the option to defer the payment of
interest was determined not to be "remote," the Junior Subordinated Debentures
would be treated as having been originally issued with OID. In such event, all
of a holder's taxable interest income with respect to the Junior Subordinated
Debentures would be accounted for on an economic accrual basis regardless of
such holder's method of tax accounting, and actual distributions of stated
interest would not be reported as taxable income.
77
<PAGE>
The Regulations have not yet been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation described herein.
Because income on the Trust Preferred Securities will constitute interest
or OID, corporate holders of the Trust Preferred Securities will not be entitled
to a dividends-received deduction with respect to any income recognized with
respect to the Trust Preferred Securities.
Receipt of Junior Subordinated Debentures or Cash Upon Liquidation of the Trust
The Corporation will have the right at any time to liquidate the Trust and
cause the Junior Subordinated Debentures to be distributed to the holders of the
Trust Securities. Such a distribution, for United States federal income tax
purposes, would be treated as a nontaxable event to each holder, and each holder
would receive an aggregate tax basis in the Junior Subordinated Debentures equal
to such holder's aggregate tax basis in its Trust Preferred Securities. A
holder's holding period in the Junior Subordinated Debentures so received in
liquidation of the Trust would include the period during which the Trust
Preferred Securities were held by such holder.
Under certain circumstances described herein (see "Description of Trust
Preferred Securities"), the Junior Subordinated Debentures may be redeemed for
cash and the proceeds of such redemption distributed to holders in redemption of
their Trust Preferred Securities. Such a redemption would, for United States
federal income tax purposes, constitute a taxable disposition of the redeemed
Trust Preferred Securities, and a holder could recognize gain or loss as if it
sold such redeemed Trust Preferred Securities for cash. See "--Sales of Trust
Preferred Securities."
Sales of Trust Preferred Securities
A holder that sells Trust Preferred Securities (including a redemption of
the Trust Preferred Securities by the Corporation) will recognize gain or loss
equal to the difference between its adjusted tax basis in the Trust Preferred
Securities and the amount realized on the sale of such Trust Preferred
Securities (other than with respect to accrued and unpaid interest which has not
yet been included in income, which will be treated as ordinary income). A
holder's adjusted tax basis in the Trust Preferred Securities generally will be
its initial purchase price increased by OID (if any) previously includable in
such holder's gross income to the date of disposition and decreased by payments
(if any) received on the Trust Preferred Securities in respect of OID. Such gain
or loss generally will be a capital gain or loss and generally will be a
long-term capital gain or loss if the Trust Preferred Securities have been held
for more than one year.
The Trust Preferred Securities may trade at a price that does not
accurately reflect the value of accrued but unpaid interest with respect to the
underlying Junior Subordinated Debentures. A holder who uses the accrual method
of accounting for tax purposes (and a cash method holder, if the Junior
Subordinated Debenture are deemed to have been issued with OID)
78
<PAGE>
who disposes of his Trust Preferred Securities between record dates for payments
of distributions thereon will be required to include accrued but unpaid interest
on the Junior Subordinated Debentures through the date of disposition in income
as ordinary income (i.e., interest or, if applicable, OID), and to add such
amount to his adjusted tax basis in his pro rata share of the underlying Junior
Subordinated Debentures deemed disposed of. To the extent the selling price is
less than the holder's adjusted tax basis (which will include all accrued but
unpaid interest) a holder will recognize a capital loss. Subject to certain
limited exceptions, capital losses cannot be applied to offset ordinary income
for United States federal income tax purposes.
Proposed Tax Legislation
On February 6, 1997, as part of President Clinton's Fiscal 1998 Budget
Proposal, the United States Treasury Department proposed legislation that would,
among other things, deny an issuer a deduction for United States federal income
tax purposes for the payment of interest on instruments with characteristics
similar to the Junior Subordinated Debentures. If the proposed legislation were
enacted in its current form, it is not expected to apply to the Junior
Subordinated Debentures since the proposed effective date for this provision is
the date of first committee action. There can be no assurances, however, that
the proposed legislation, if enacted, or similar legislation enacted after the
date hereof would not adversely affect the tax treatment of the Junior
Subordinated Debentures, resulting in a Tax Event. The occurrence of a Tax Event
may result in the redemption of the Junior Subordinated Debentures for cash, in
which event the holders of the Trust Preferred Securities would receive cash in
redemption of their Trust Preferred Securities. See "Description of Trust
Preferred Securities--Redemption" and "Description of Junior Subordinated
Debentures--Special Event Prepayment."
United States Alien Holders
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is not a U.S. Holder
for United States federal income tax purposes.
A "U.S. Holder" is a holder of Trust Preferred Securities who or which is
(i) a citizen or individual resident (or is treated as a citizen or individual
resident) of the United States for federal income tax purposes, (ii) a
corporation or partnership created or organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate the income
of which is includable in its gross income for federal income tax purposes
without regard to its source or (iv) a trust over which (A) a court within the
United States is able to exercise primary supervision over the administration of
the trust and (B) one or more United States trustees have the authority to
control all substantial decisions of the trust.
Under present United States federal income tax laws: (i) payments by the
Trust or any of its paying agents to any holder of a Trust Preferred Security
who or which is a United States Alien Holder will not be subject to United
States federal withholding tax; provided that, (a) the beneficial owner of the
Trust Preferred Security does not actually or constructively own 10 percent or
more of the total combined voting power of all classes of stock of the
Corporation
79
<PAGE>
entitled to vote, (b) the beneficial owner of the Trust Preferred Security is
not a controlled foreign corporation that is related to the Corporation through
stock ownership, and (c) either (A) the beneficial owner of the Trust Preferred
Security certifies to the Trust or its agent, under penalties of perjury, that
it is not a United States holder and provides its name and address or (B) a
securities clearing organization, bank or other financial institution that holds
customers' securities in the ordinary course of its trade or business (a
"Financial Institution"), and holds the Trust Preferred Security in such
capacity, certifies to the Trust or its agent, under penalties of perjury, that
such statement has been received from the beneficial owner by it or by a
Financial Institution between it and the beneficial owner and furnishes the
Trust or its agent with a copy thereof; and (ii) a United States Alien Holder of
a Trust Preferred Security will not be subject to United States federal
withholding tax on any gain realized upon the sale or other disposition of a
Trust Preferred Security.
As discussed above, changes in legislation affecting the United States
federal income tax treatment of the Junior Subordinated Debentures are possible,
and could adversely affect the ability of the Corporation to deduct the interest
payable on the Junior Subordinated Debentures. Moreover, any such legislation
could adversely affect United States Alien Holders by characterizing income
derived from the Junior Subordinated Debentures as dividends, generally subject
to a 30% income tax (on a withholding basis) when paid to a United States Alien
Holder, rather than as interest which, as discussed above, is generally exempt
from income tax in the hands of a United States Alien Holder.
Information Reporting to Holders
Generally, income on the Trust Preferred Securities will be reported to
holders on Forms 1099, which forms should be mailed to holders of Trust
Preferred Securities by January 31 following each calendar year.
Backup Withholding
Payments made on, and proceeds from the sale of, the Trust Preferred
Securities may be subject to a "backup" withholding tax of 31 percent unless the
holder complies with certain identification requirements. Any withheld amounts
will be allowed as a credit against the holder's United States federal income
tax, provided the required information is provided to the IRS.
80
<PAGE>
ERISA CONSIDERATIONS
Each of the Corporation (the obligor with respect to the Junior
Subordinated Debentures held by the Trust), and its affiliates and the Property
Trustee may be considered a "party in interest" (within the meaning of ERISA) or
a "disqualified person" (within the meaning of Section 4975 of the Code) with
respect to many Plans that are subject to ERISA and certain employee
benefit-related provisions of the Code. The purchase and/or holding of Trust
Preferred Securities by a Plan that is subject to the fiduciary responsibility
provisions of ERISA or the prohibited transaction provisions of Section 4975 of
the Code (including individual retirement arrangements and other plans described
in Section 4975(e)(1) of the Code) and with respect to which the Corporation,
the Property Trustee or any affiliate is a service provider (or otherwise is a
party in interest or a disqualified person) may constitute or result in a
prohibited transaction under ERISA or Section 4975 of the Code, unless such
Trust Preferred Securities are acquired pursuant to and in accordance with an
applicable exemption, such as Prohibited Transaction Class Exemption ("PTCE")
84-14 (an exemption for certain transactions determined by an independent
qualified professional asset manager), PTCE 91-38 (an exemption for certain
transactions involving bank collective investment funds), PTCE 90-1 (an
exemption for certain transactions involving insurance company pooled separate
accounts), PTCE 95-60 (an exemption for transactions involving certain insurance
company general accounts) or PTCE 96-23 (an exemption for certain transactions
determined by an in-house asset manager). In addition, a Plan fiduciary
considering the purchase of Trust Preferred Securities should be aware that the
assets of the Trust may be considered "plan assets" for ERISA purposes. In such
event, any persons exercising discretion with respect to the Junior Subordinated
Debentures may become fiduciary parties in interest or disqualified persons with
respect to investing Plans. In order to avoid certain prohibited transactions
under ERISA and the Code that could thereby result, each investing Plan, by
purchasing the Trust Preferred Securities, will be deemed to have directed the
Trust to invest in the Junior Subordinated Debentures and to have consented to
the appointment of the Property Trustee. In this regard, it should be noted
that, in an Event of Default, the Corporation may not remove the Property
Trustee without the approval of a majority of the holders of the Trust Preferred
Securities. Further, prior to an Event of Default with respect to the Junior
Subordinated Debentures, the Property Trustee will have only limited custodial
and ministerial authority with respect to Trust assets.
A Plan fiduciary should consider whether the purchase of Trust Preferred
Securities could result in a delegation of fiduciary authority to the Property
Trustee, and, if so, whether such a delegation of authority is permissible under
the Plan's governing instrument or any investment management agreement with the
Plan. In making such determination, a Plan fiduciary should note that the
Property Trustee is a U.S. bank qualified to be an investment manager (within
the meaning of Section 3(38) of ERISA) for the purposes of delegation of
authority under ERISA.
The sale of investments to plans is in no respect a representation by the
trust, the corporation, the property trustee, the Underwriters or any other
person associated with the sale of the Trust Preferred Securities that such
securities meet all relevant legal requirements with respect to investments by
plans generally or any particular plan, or that such securities are otherwise
appropriate for plans generally or any particular plan. Any
81
<PAGE>
purchaser proposing to acquire Trust Preferred Securities with assets of any
plan should consult with its counsel.
82
<PAGE>
UNDERWRITING
Legg Mason Wood Walker, Incorporated and Piper Jaffray Inc. (the
"Underwriters"), have agreed, subject to the terms and conditions of an
Underwriting Agreement to be entered into by the Underwriters, the Corporation
and the Trust to purchase from the Trust 1,000,000 Trust Preferred Securities.
The Underwriters have committed to purchase and pay for all such Trust Preferred
Securities if any are purchased.
The Underwriters have advised the Corporation and the Trust that they
propose to offer the Trust Preferred Securities directly to the public initially
at the public offering price set forth on the cover page of this Prospectus and
to certain dealers at such price less a concession not in excess of $ per
Trust Preferred Security. The Underwriters may allow and such dealers may
reallow a concession not in excess of $ per Trust Preferred Security to
certain other brokers and dealers. After the public offering, the public
offering price, concession and reallowance, and other selling terms may be
changed by the Underwriters.
In view of the fact that the proceeds from the sale of the Trust Preferred
Securities will be used to purchase the Junior Subordinated Debentures issued by
the Corporation, the Underwriting Agreement provides that the Corporation will
pay as compensation for the Underwriters' arranging the investment therein of
such proceeds an amount of $ per Trust Preferred Security.
The Trust has granted to the Underwriters an option, exercisable for 30
days from the date of this Prospectus, to purchase up to an additional 150,000
Trust Preferred Securities at the public offering price set forth on the cover
page hereof less underwriting discounts. The Underwriters may exercise such
option to purchase additional Trust Preferred Securities solely for the purpose
of covering over-allotments, if any, incurred in the sale of the Trust Preferred
Securities.
To the extent that the Underwriters exercise their option to purchase
additional Trust Preferred Securities, the Trust will issue and sell to the
Corporation additional Common Securities and the Corporation will issue and sell
to the Trust Junior Subordinated Debentures in an aggregate principal amount
equal to the total aggregate Liquidation Amount of the additional Trust
Preferred Securities being purchased pursuant to the option and the additional
Common Securities.
Each of the Corporation and the Trust has agreed to indemnify the
Underwriters and their controlling persons against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribute to payments the Underwriters may be required to made in respect
thereof.
The Underwriters have advised the Trust that they do not intend to confirm
sales to any account over which they exercise discretionary authority in excess
of 5% of the number of Trust Preferred Securities offered hereby.
In connection with this offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the Trust
Preferred Securities. Specifically, the Underwriters may overallot the offering,
creating a syndicate short position. In addition, the Underwriters may bid for
and purchase Trust Preferred Securities in the open market to stabilize
83
<PAGE>
the price of the Trust Preferred Securities. These activities may stabilize or
maintain the market price of the Trust Preferred Securities above independent
market levels. The Underwriters are not required to engage in these activities,
and may end these activities at any time.
LEGAL MATTERS
Certain legal matters will be passed upon for the Corporation by Elias,
Matz, Tiernan & Herrick L.L.P., Washington, D.C., and for the Underwriters by
Skadden, Arps, Slate, Meagher & Flom LLP. Certain matters of Delaware law
relating to the validity of the Trust Preferred Securities will be passed upon
on behalf of the Trust by Skadden, Arps, Slate, Meagher & Flom (Delaware),
special Delaware counsel to the Trust. Certain matters relating to United States
federal income tax considerations will be passed upon for the Corporation by
Elias, Matz, Tiernan & Herrick L.L.P., Washington, D.C.
INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated financial statements of Independent Bank Corp. and
subsidiary incorporated by reference in the Corporation's Annual Report on Form
10-K for the year ended December 31, 1996 and incorporated by reference in this
Prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as stated in their report appearing therein.
84
<PAGE>
================================================================================
No dealer, salesperson or other individual has been authorized to give any
information or to make any representations other than those contained or
incorporated by reference in this Prospectus in connection with the offer made
by this Prospectus and, if given or made, such information or representations
must not be relied upon as having been authorized by the Corporation, the Trust
or the Underwriters. 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 or the Trust since the date
hereof. This Prospectus does not constitute an offer or solicitation by anyone
in any jurisdiction in which such offer or solicitation is not authorized or in
which the person making such offer or solicitation is not qualified to do so or
to anyone to whom it is unlawful to make such offer or solicitation.
___________
TABLE OF CONTENTS
Page
----
Available Information..............................................
Incorporation of Certain Documents by
Reference.........................................................
Summary............................................................
Risk Factors.......................................................
Independent Bank Corp..............................................
Use of Proceeds....................................................
Ratios of Earnings to Fixed Charges................................
Capitalization.....................................................
Accounting Treatment...............................................
Recent Developments................................................
Selected Consolidated Financial Data...............................
Management of Independent and the Bank.............................
Independent Capital Trust I........................................
Description of Trust Preferred Securities..........................
Description of Junior Subordinated Debentures......................
Description of Guarantee...........................................
Book-Entry Issuance................................................
Relationship Among the Trust Preferred
Securities, the Junior Subordinated
Debentures and the Guarantee......................................
Certain Federal Income Tax Consequences............................
ERISA Considerations...............................................
Underwriting.......................................................
Legal Matters......................................................
Independent Public Accountants.....................................
Until , 1997 (25 days after the date of this prospectus), all dealers
effecting transactions in the registered securities, whether or not
participating in this distribution, may be required to deliver a Prospectus.
This is in addition to the obligation of dealers to deliver a Prospectus when
acting as underwriters and with respect to their unsold allotments or
subscriptions.
================================================================================
================================================================================
1,000,000 TRUST PREFERRED
SECURITIES
INDEPENDENT CAPITAL
TRUST I
_____% Trust Preferred Securities
fully and unconditionally guaranteed,
as described herein, by
Independent Bank Corp.
----------
Prospectus
----------
Legg Mason Wood Walker
Incorporated
Piper Jaffray Inc.
______ __, 1997
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
<TABLE>
<S> <C>
SEC registration fee..................... $ 8,713
NASD fee.................................
Nasdaq fees..............................
Trustees' fees and expenses..............
Legal fees and expenses.................. *
Blue Sky fees and expenses............... *
Accounting fees and expenses............. *
Printing expenses........................ *
Miscellaneous expenses................... *
--------
Total.................................. $
--------
--------
</TABLE>
_________________
* Estimated.
Item 15. Indemnification of Directors and Officers.
Section 67 of the Massachusetts Business Corporation Law ("MBCL") sets
forth certain circumstances under which directors, officers, employees and
agents may be indemnified against liability which they may incur in their
capacity as such. Section 67 of the MBCL provides as follows:
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, ETC.--Indemnification of
directors, officer, employees and other agents of a corporation and persons
who serve at its request as directors, officers, employees or other agents
of another organization or who serve at its request in any capacity with
respect to any employee benefit plan, may be provided by it to whatever
extent shall be specified in or authorized by (i) the articles of
organization or (ii) a by-law adopted by the stockholders or (iii) a vote
adopted by the holders of a majority of the shares of stock entitled to
vote on the election of directors. Except as the articles of organization
or by-laws otherwise require, indemnification of any persons referred to in
the preceding sentence who are not directors of the corporation may be
provided by it to the extent authorized by the directors. Such
indemnification may include payment by the corporation of expenses incurred
in defending a civil or criminal action or proceeding in advance of the
final disposition of such action or proceeding, upon receipt of an
undertaking by the person indemnified to repay such payment if he shall be
adjudicated to be not entitled to indemnification under this section which
undertaking may be accepted without reference to the financial ability of
such person to make repayment. Any such indemnification may be provided
although the person to be indemnified is no longer an officer, director,
II-1
<PAGE>
employee or agent of the corporation or of such other organization or no
longer serves with respect to any such employee benefit plan.
No indemnification shall be provided for any person with respect to
any matter as to which he shall have been adjudicated in any proceeding not
to have acted in good faith in the reasonable belief that his action was in
the best interest of the corporation or to the extent that such matter
relates to service with respect to an employee benefit plan, in the best
interests of the participants or beneficiaries of such employee benefit
plan.
The absence of any express provision for indemnification shall not
limit any right of indemnification existing independently of this section.
A corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or other
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or other agent of another
organization or with respect to any employee benefit plan against any
liability incurred by him in any such capacity, or arising out of his
status as such, whether or not the corporation would have the power to
indemnify him against such liability.
Article Twelfth of the Company's By-laws, entitled "Indemnification of
Directors, Officers and Others," provides as follows:
The corporation shall, to the extent legally permissible, indemnify
any person serving on who has served (i) as a Director or officer of the
corporation, or (ii) at its request as a Director, trustee, officer,
employee or other agent of another organization, or (iii) at its request
in any capacity with respect to any employee benefit plan; against all
liabilities and expenses including amounts paid in satisfaction of
judgments, in compromise or as fines and penalties, and counsel fees
reasonably incurred by him or her in connection with the defense or
disposition of any action, suit or other proceeding, whether civil,
criminal or administrative, in which he or she may be involved or with
which he or she may be threatened, while serving or thereafter, by reason
of his or her being or having been such a Director, officer, trustee,
employee or agent, except with respect to any matter as to which he or she
shall have been adjudicated in any proceeding not to have acted in good
faith in the reasonable belief that his or her action was in the best
interests of the corporation or to the extent that such matter relates to
services with respect to an employee benefit plan, in the best interest of
the participants or beneficiaries of such employee benefit plan; provided,
however, that as to any matter disposed of by a compromise payment by such
Director, officer, trustee, employee or agent, pursuant to a consent decree
or otherwise, no indemnification either for said payment or for any other
expenses shall be provided unless:
II-2
<PAGE>
(a) such compromise shall be approved as having been in the best
interests of the corporation or employee benefit plan participants or
beneficiaries, as the case may be, after notice that it involves such
indemnification:
(i) by a disinterested majority of the Directors then in
office; or
(ii) by the holders of a majority of the outstanding stock
by the time entitled to vote for Directors, voting as
a single class, exclusive of any stock owned by any
interested Director or officer; or
(b) in the absence of action by disinterested Directors or
stockholders, there has been obtained at the request of a majority of
the Directors then in office an opinion in writing of independent
legal counsel to the effect that such Director or officer appears to
have acted in good faith in the reasonable belief that his or her
action was in the best interests of the corporation or employee
benefit plan participants or beneficiaries, as the case may be.
Expenses including counsel fees, reasonably incurred by any such
Director, officer, trustee, employee or agent in connection with the
defense or disposition of any such action, suit or other proceeding may be
paid from time to time by the corporation in advance of the final
disposition thereof upon receipt of an undertaking by such individual to
repay the amounts so paid to the corporation if it is ultimately determined
that indemnification for such expenses is not authorized under this
section. The right of indemnification hereby provided shall not be
exclusive of or affect any other rights to which any such Director,
officer, trustee, employee or agent may be entitled. Nothing contained in
this Article shall affect any rights to indemnification to which corporate
personnel other than such Directors, officers, trustee, employees or agents
may be entitled by contract or otherwise under law. As used in this
Article the terms "Director," "officer," "trustee," "employee," and "agent"
include their respective heirs, executors and administrators, and an
"interested" Director, officer, trustee, employee or agent is one against
whom in such capacity the proceedings in question or other proceeding on
the same or similar grounds is then pending.
II-3
<PAGE>
Item 16. Exhibits and Financial Statement Schedules
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
1 Form of Underwriting Agreement
4.1 Indenture of the Corporation relating to the Junior Subordinated
Debentures
4.2 Form of Certificate of Junior Subordinated Debenture (included as
Exhibit A to Exhibit 4.1)
4.3 Certificate of Trust of Independent Capital Trust I
4.4 Amended and Restated Declaration of Trust of Independent Capital
Trust I
4.5 Form of Trust Preferred Security Certificate for Independent
Capital Trust I (included as Exhibit A to Exhibit 4.4)
4.6 Form of Guarantee of the Corporation relating to the Trust
Preferred Securities
5.1 Opinion and consent of Elias, Matz, Tiernan & Herrick L.L.P. as to
legality of the Junior Subordinated Debentures and the Guarantee to
be issued by the Corporation*
5.2 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP as to legality
of the Trust Preferred Securities to be issued by Independent
Capital Trust I*
8 Opinion of Elias, Matz, Tiernan & Herrick L.L.P. as to certain
federal income tax matters*
12.1 Computation of ratio of earnings to fixed charges (excluding
interest on deposits)
12.2 Computation of ratio of earnings to fixed charges (including
interest on deposits)
23.1 Consent of Arthur Anderson LLP
23.2 Consent of Elias, Matz, Tiernan & Herrick L.L.P. (included in
Exhibit 5.1)*
23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in
Exhibit 5.2)*
24 Power of Attorney of certain officers and directors of the
Corporation (located on the signature page hereto)
25.1 Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Indenture
25.2 Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Declaration of Trust of Independent Capital
Trust I
25.3 Form T-1 Statement of Eligibility of The Bank of New York under
the Guarantee for the benefit of the holders of the Trust
Preferred Securities
</TABLE>
- ----------------
* To be filed by amendment.
II-4
<PAGE>
Item 17. Undertakings
Each of the undersigned Registrants hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, as amended,
each filing of a Registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of each undersigned Registrant pursuant to the provisions, or otherwise, each
Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
each undersigned Registrant of expenses incurred or paid by a director,
officer of controlling person of each Registrant in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, each
Registrant will, unless in the opinion of its counsel the matter has been
settled by the controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrants pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act of 1933 shall be deemed to be part of this
registration statement as of the time it was declared effective.
For the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Independent
Bank Corp. 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 Rockland, State of Massachusetts on
the 24th day of April 1997.
INDEPENDENT BANK CORP.
By: /s/ John F. Spence, Jr.
-------------------------------
John F. Spence, Jr.
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each of the directors and/or officers
of Independent Bank Corp. whose signature appears below hereby appoints John
F. Spence, Jr., Douglas H. Philipsen and Richard J. Seaman, and each of them
severally, as his or her attorney-in-fact to sign in his or her name and
behalf, in any and all capacities stated below and to file with the
Securities and Exchange Commission any and all amendments, including
post-effective amendments, to this Registration Statement on Form S-3, making
such changes in the Registration Statement as appropriate, and generally to
do all such things in their behalf in their capacities as directors and/or
officers to enable Independent Bank Corp. to comply with the provisions of
the Securities Act of 1933, and all requirements of the Securities and
Exchange Commission.
/s/ Richard S. Anderson
- ------------------------------ Date: April 24, 1997
Richard S. Anderson
Director
/s/ Donald K. Atkins
- ----------------------------- Date: April 24, 1997
Donald K. Atkins
Director
/s/ W. Paul Clark
- ----------------------------- Date: April 24, 1997
W. Paul Clark
Director
II-6
<PAGE>
- ----------------------------- Date: April __, 1997
Robert L. Cushing
Director
- ----------------------------- Date: April __, 1997
Benjamin A. Gilmore, II
Director
/s/ Lawrence M. Levinson
- ----------------------------- Date: April 24, 1997
Lawrence M. Levinson
Director
/s/ Douglas H. Philipsen
- ----------------------------- Date: April 24, 1997
Douglas H. Philipsen
Director and President
/s/ Richard H. Sgarzi
- ----------------------------- Date: April 24, 1997
Richard H. Sgarzi
Director
/s/ John F. Spence, Jr.
- ----------------------------- Date: April 24, 1997
John F. Spence, Jr.
Chairman of the Board and
Chief Executive Officer
(principal executive officer)
/s/ Robert J. Spence
- ----------------------------- Date: April 24, 1997
Robert J. Spence
Director
/s/ William J. Spence
- ----------------------------- Date: April 24, 1997
William J. Spence
Director
/s/ Brian S. Tedeschi
- ----------------------------- Date: April 24, 1997
Brian S. Tedeschi
Director
/s/ Thomas J. Teuten
- ----------------------------- Date: April 24, 1997
Thomas J. Teuten
Director
II-7
<PAGE>
/s/ Richard J. Seaman
- ----------------------------- Date: April 24, 1997
Richard J. Seaman
Chief Financial Officer and Treasurer
(principal financial and accounting officer)
Pursuant to the requirements of the Securities Act of 1933, Independent
Capital Trust I certifies that it has reasonable grounds to believe that it
meets all 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 Rockland, State of Massachusetts,
on the 24th day of April 1997.
INDEPENDENT CAPITAL TRUST I
By: /s/ Douglas H. Philipsen
-----------------------------
Douglas H. Philipsen
Administrative Trustee
By: /s/ Richard J. Seaman
-----------------------------
Richard J. Seaman
Administrative Trustee
By: /s/ Russell N. Viau
-----------------------------
Russell N. Viau
Administrative Trustee
II-8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
1 Form of Underwriting Agreement
4.1 Indenture of the Corporation relating to the Junior Subordinated
Debentures
4.2 Form of Certificate of Junior Subordinated Debenture (included as
Exhibit A to Exhibit 4.1)
4.3 Certificate of Trust of Independent Capital Trust I
4.4 Amended and Restated Declaration of Trust of Independent Capital
Trust I
4.5 Form of Trust Preferred Security Certificate for Independent
Capital Trust I (included as Exhibit A to Exhibit 4.4)
4.6 Form of Guarantee of the Corporation relating to the Trust
Preferred Securities
5.1 Opinion and consent of Elias, Matz, Tiernan & Herrick L.L.P. as to
legality of the Junior Subordinated Debentures and the Guarantee to
be issued by the Corporation*
5.2 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP as to legality
of the Trust Preferred Securities to be issued by Independent
Capital Trust I*
8 Opinion of Elias, Matz, Tiernan & Herrick L.L.P. as to certain
federal income tax matters*
12.1 Computation of ratio of earnings to fixed charges (excluding
interest on deposits)
12.2 Computation of ration of earnings to fixed charges (including
interest on deposits)
23.1 Consent of Arthur Anderson LLP
23.2 Consent of Elias, Matz, Tiernan & Herrick L.L.P. (included in
Exhibit 5.1)*
23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in
Exhibit 5.2)*
24 Power of Attorney of certain officers and directors of the
Corporation (located on the signature page hereto)
25.1 Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Indenture
25.2 Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Declaration of Trust of Independent Capital
Trust I
25.3 Form T-1 Statement of Eligibility of The Bank of New York under
the Guarantee for the benefit of the holders of the Trust
Preferred Securities
</TABLE>
- ----------------
* To be filed by amendment.
<PAGE>
EXHIBIT 1
==============================================================================
INDEPENDENT BANK CORP.
(a Massachusetts corporation); and
INDEPENDENT CAPITAL TRUST I
(a Delaware statutory business trust)
1,000,000
__% Cumulative Trust
Preferred Securities
UNDERWRITING AGREEMENT
Dated: April __, 1997
==============================================================================
<PAGE>
INDEPENDENT BANK CORP.
(a Massachusetts corporation); and
INDEPENDENT CAPITAL TRUST I
(a Delaware statutory business trust)
1,000,000
__% Cumulative Trust
Preferred Securities
(Liquidation Amount $25 Per Cumulative Preferred Security)
UNDERWRITING AGREEMENT
----------------------
April __, 1997
<PAGE>
LEGG MASON WOOD WALKER INCORPORATED
PIPER JAFFRAY, INC.
c/o Legg Mason Wood Walker Incorporated
1747 Pennsylvania Avenue N.W.
Washington, D.C. 20006
Attention: Mark C. Micklem, Managing Director
Ladies and Gentlemen:
Independent Capital Trust I (the "Trust"), a statutory business trust
organized under the Delaware Business Trust Act, 12 Del. C. Sections 3801 et
seq. (the "Delaware Act"), confirms its agreement with you, Legg Mason Wood
Walker Incorporated ("Legg Mason") and Piper Jaffray, Inc. (each an
"Underwriter" and together, the "Underwriters," which term shall also include
any underwriter substituted as hereinafter provided in Section 10 hereof),
with respect to the issuance and sale by the Trust, and the purchase by the
Underwriters, acting severally and not jointly, of the respective numbers of
__% Cumulative Trust Preferred Securities (liquidation amount $25 per
preferred security) set forth in Schedule A hereto and the grant by the Trust
to the Underwriters, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of 150,000
additional Preferred Securities to cover
2
<PAGE>
overallotments, if any. The aforesaid 1,000,000 preferred securities (the
"Initial Preferred Securities") to be purchased by the Underwriters and all
or any part of the 150,000 preferred securities subject to the option
described in Section 2(b) hereof (the "Optional Preferred Securities") are
hereinafter called, collectively, the "Preferred Securities." The Preferred
Securities are more fully described in the Prospectus (as defined below).
The Preferred Securities will be guaranteed by Independent Bank Corp.
(the "Company"), to the extent set forth in the Prospectus (as defined
below), with respect to distributions and amounts payable upon liquidation or
redemption (the "Preferred Securities Guarantee") pursuant to the Preferred
Securities Guarantee Agreement (the "Preferred Securities Guarantee
Agreement") to be dated as of Closing Time (as defined below) executed and
delivered by the Company and The Bank of New York (the "Guarantee Trustee"),
a New York banking corporation, not in its individual capacity but solely as
trustee for the benefit of the holders from time to time of the Preferred
Securities. The Company and the Trust each understand that the Underwriters
propose to make a public offering of the Preferred Securities as soon as they
deem advisable after this Agreement has been executed and delivered, and the
Declaration (as defined herein), the Indenture (as defined herein), and the
Preferred Securities Guarantee Agreement have been qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). The entire proceeds from
the sale of the Preferred Securities will be combined with the entire
proceeds from the sale by the Trust to the Company of its common securities
(the "Common Securities") guaranteed by the Company, to the extent set forth
in the Prospectus, with respect to distributions and amounts payable upon
liquidation or redemption (the "Common Securities Guarantee" and, together
with the Preferred Securities Guarantee, the "Guarantees") pursuant to the
Common Securities Guarantee Agreement (the "Common Securities Guarantee
Agreement" and, together with the Preferred Securities Guarantee Agreement,
the "Guarantee Agreements"), to be dated as of Closing Time, executed and
delivered by the Company for the benefit of the holders from time to time of
the Common Securities, and will be used by the Trust to purchase the __%
Junior Subordinated Deferrable Interest Debentures due 2027 (the "Junior
Subordinated Debentures") issued by the Company. The Preferred Securities
and the Common Securities will be issued pursuant to the Amended and Restated
Declaration of Trust of the Trust, to be dated as of Closing Time (the
"Declaration"), among the Company, as Sponsor, The Bank of New York, as
property trustee (the "Property Trustee"), The Bank of New York (Delaware),
as Delaware trustee (the "Delaware Trustee"), and Douglas H. Philipsen,
Richard J. Seaman and Russell N. Viau, as administrative trustees (the
"Administrative Trustees" and together with the Property Trustee and the
Dela-
3
<PAGE>
ware Trustee, the "Trustees"), and the holders from time to time of
undivided beneficial interests in the assets of the Trust. The Junior
Subordinated Debentures will be issued pursuant to an Indenture, to be dated
as of Closing Time (the "Indenture"), between the Company and The Bank of New
York, as debenture trustee (the "Debenture Trustee"). The Preferred
Securities, the Preferred Securities Guarantee and the Junior Subordinated
Debentures are collectively referred to herein as the "Securities." The
Trust and the Company are collectively referred to herein as the "Offerors."
The Indenture, the Declaration and this Agreement are collectively referred
to herein as the "Operative Documents." Capitalized terms used herein
without definition have the respective meanings specified in the Prospectus.
The Company and the Trust have filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(No. _____) covering the registration of the Securities under the Securities
Act of 1933, as amended (the "1933 Act"), including the related preliminary
prospectus. Promptly after execution and delivery of this Agreement, the
Company will either (i) prepare and file a prospectus in accordance with the
provisions of Rule 430A ("Rule 430A") of the rules and regulations of the
Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b)
of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the
Company and the Trust have elected to rely upon Rule 434 ("Rule 434") of the
1933 Act Regulations, prepare and file a term sheet (a "Term Sheet") in
accordance with the provisions of Rule 434 and Rule 424(b). The information
included in such prospectus or in such Term Sheet, as the case may be, that
was omitted from such registration statement at the time it became effective
but that is deemed to be part of such registration statement at the time it
became effective (a) pursuant to paragraph (b) of Rule 430A is referred to as
"Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is
referred to as "Rule 434 Information." Each prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information that was
used after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto, if any, at
the time it became effective and including the rule 430A Information and the
Rule 434 Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to rule 462(b) of the
1933 Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement" and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. The final prospectus in the
form first furnished to the Underwriters for use in connection with the
offering of the Preferred Securities is herein called
4
<PAGE>
the "Prospectus." If Rule 434 is relied on, the term "Prospectus" shall
refer to the preliminary prospectus dated April __, 1997 together with the
Term Sheet and all references in this Agreement to the date of the Prospectus
shall mean the date of the Term Sheet. For purposes of this Agreement, all
references to the Registration Statement, any preliminary prospectus, the
Prospectus or any Term Sheet or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("EDGAR").
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Offerors jointly and severally represent and warrant to
each Underwriter as of the date hereof, as of the Closing Time referred to in
Section 2(c) hereof and as of each Date of Delivery (if any) referred to in
Section 2(b) hereof, and agree with each Underwriter as follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any Optional Preferred
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement, if any, and any
amendments and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading. Neither the Prospectus nor any
amendments or supplements thereto, at the time the Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Optional Preferred Securities are purchased, at the Date of Delivery),
included or will include an untrue statement of a material fact or omitted
or will omit to state a material fact necessary in order to make the
5
<PAGE>
statements therein, in the light of the circumstances under which they were
made, not misleading. If Rule 434 is used, the Company will comply with
the requirements of Rule 434 and the Prospectus shall not be "materially
different," as such term is used in Rule 434, from the prospectus included
in the Registration Statement at the time it became effective. The
representations and warranties in this subsection shall not apply (A) to
statements in or omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with information furnished to the
Trust or the Company in writing by any Underwriter through Legg Mason
expressly for use in the Registration Statement or Prospectus and (B) that
part of the Registration Statement which shall constitute the Statements of
Eligibility (Forms T-1) under the 1939 Act.
Each preliminary prospectus and the prospectus filed as part of
the Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and, if
applicable, each preliminary prospectus and the Prospectus delivered to the
Underwriters for use in connection with this offering was substantively
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(ii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements included or incorporated by reference in the
Prospectus are independent public accountants within the meaning of the
1933 Act and the rules and regulations of the Commission under the 1933 Act
Regulations.
(iii) FINANCIAL STATEMENTS. The consolidated historical
financial statements, together with the related schedules and notes,
included in the Prospectus present fairly, in all material respects, the
consolidated financial position of the Company and its consolidated
subsidiaries at the dates indicated, and the statements of income, changes
in stockholders' equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said financial statements have been
prepared in conformity with generally accepted accounting principles
("GAAP") in the United States applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such financial
statements; the supporting schedules, if any, included in the Prospectus
present fairly, in all material respects, the information required to be
stated therein; and the
6
<PAGE>
summary financial data included in the Prospectus present fairly, in all
material respects, the information shown therein and have been compiled
on a basis consistent with that of the audited financial statements
included in the Prospectus.
(iv) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the
respective dates as of which information is given in the Prospectus, except
as otherwise stated therein or contemplated thereby, there has not been (A)
any material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Trust, or of
the Company and its subsidiaries, considered as one enterprise, whether or
not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) any transaction entered into by the Trust, the Company or any
of its subsidiaries, other than in the ordinary course of business, that is
material to the Trust, or to the Company and its subsidiaries, considered
as one enterprise, or (C) any dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock,
other than regular quarterly dividends on the Company's common stock.
(v) GOOD STANDING OF THE COMPANY. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Massachusetts and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform its
obligations under each of the Operative Documents to which it is a party;
the Company is duly registered as a bank holding company under the Bank
Holding Company Act of 1956, as amended.
(vi) GOOD STANDING OF THE BANK. Rockland Trust Company (the
"Bank") has been duly organized and is validly existing as a trust company
in good standing under the laws of the State of Massachusetts and has full
power and authority under such laws to own, lease and operate its
properties and to conduct its business as now being conducted and as
described in the Prospectus.
(vii) NO OTHER SIGNIFICANT SUBSIDIARIES. There are no
"significant subsidiaries" of the Company (as such term is defined in Rule
1-02 of Regulation S-X) other than the Bank. The subsidiaries of the
Company other than the Bank, considered in the aggregate as a single
subsidiary, do not constitute a "significant subsidiary" as defined in Rule
1-02 of Regulation S-X.
7
<PAGE>
(viii) FOREIGN QUALIFICATIONS. The Company and the Bank are each
duly qualified as a foreign corporation to transact business and are each
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in good
standing would not result in a Material Adverse Effect (as defined in
Section 1(a)(iv) hereof).
(ix) CAPITAL STOCK DULY AUTHORIZED AND VALIDLY ISSUED. All of
the issued and outstanding capital stock of the Company has been duly
authorized and validly issued and is fully paid and nonassessable and none
of the capital stock of the Company was issued in violation of the
preemptive rights of any shareholder of the Company; all of the issued and
outstanding capital stock of the Bank has been duly authorized and validly
issued, is fully paid and nonassessable and is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right; and none of
such outstanding shares of capital stock of the Bank was issued in
violation of any preemptive or similar rights arising by operation of law,
or under the charter or by-laws of the Company or the Bank or under any
agreement to which the Company or the Bank is a party.
(x) CAPITALIZATION. The authorized, issued and outstanding
capital stock of the Company as of March 31, 1997 is as set forth in the
Prospectus under "Capitalization," and there have not been any subsequent
issuances of capital stock of the Company except for subsequent issuances,
if any, pursuant to any dividend reinvestment plan, reservations,
agreements, conversions, stock dividends or employee or director benefit
plans.
(xi) GOOD STANDING OF THE TRUST. The Trust has been duly created
and is validly existing in good standing as a business trust under the
Delaware Act with the power and authority to own property and to conduct
its business as described in the Prospectus and to enter into and perform
its obligations under the Operative Documents, as applicable, and the
Preferred Securities; the Trust is not a party to or otherwise bound by any
material agreement other than those described in the Prospectus; and the
Trust is, and will be, under current law, classified for United States
federal income tax purposes as a grantor trust and not as an association
taxable as a corporation.
8
<PAGE>
(xii) AUTHORIZATION OF COMMON SECURITIES. The Common Securities
have been duly authorized for issuance by the Trust pursuant to the
Declaration and, when certificates therefore have been issued and executed
in accordance with the Declaration and delivered by the Trust to the
Corporation against payment therefor in accordance with the Common
Securities Subscription Agreement, will be validly issued and fully paid
and nonassessable undivided beneficial ownership interests in the assets of
the Trust. The issuance of the Common Securities is not subject to
preemptive or other similar rights; and at the Closing Time all of the
issued and outstanding Common Securities of the Trust will be directly
owned by the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equitable right.
(xiii) AUTHORIZATION OF PREFERRED SECURITIES. At the Closing
Time, the Preferred Securities will have been duly authorized for issuance
by the Trust pursuant to the Declaration, and the Preferred Securities,
when certificates therefore have been issued, executed and authenticated in
accordance with the Declaration and delivered against payment therefor as
provided herein, will be validly issued and fully paid and nonassessable
undivided beneficial ownership interests in the assets of the Trust and
will conform to the description thereof in the Prospectus. The issuance of
the Preferred Securities will not be subject to preemptive or other similar
rights.
(xiv) AUTHORIZATION OF AGREEMENT. This Agreement has been duly
authorized, executed and delivered by the Offerors.
(xv) AUTHORIZATION OF DECLARATION. The Declaration has been
qualified under the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and delivered by the
Company and the Trustees, and assuming due authorization, execution and
delivery of the Declaration by the Trustees, the Declaration will, at the
Closing Time, be a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except to the extent that
enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws now
or hereafter in effect relating to creditors' rights generally, (b) general
principles of equity (regardless of whether enforceability is considered in
a proceeding at law or in equity) and (c) any public policy underlying
applicable federal or state laws (collectively, the "Enforceability
Exceptions").
9
<PAGE>
(xvi) AUTHORIZATION OF GUARANTEES. Each of the Guarantees has
been qualified under the 1939 Act and has been duly authorized by the
Company; at the Closing Time, each of the Guarantees will have been duly
executed and delivered by the Company and will constitute a valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent that enforceability may be
limited by the Enforceability Exceptions; and the Preferred Securities
Guarantee will conform in all material respects to the description thereof
in the Prospectus.
(xvii) AUTHORIZATION OF INDENTURE. The Indenture has been
qualified under the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and delivered by the
Company and will constitute a valid, legal and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that enforceability may be limited by the
Enforceability Exceptions.
(xviii) AUTHORIZATION OF DEBENTURES. The Junior Subordinated
Debentures have been duly authorized by the Company; at the Closing Time,
the Junior Subordinated Debentures, will have been duly executed by the
Company and, when authenticated in the manner provided for in the Indenture
and delivered by the Company to the Trust against payment therefor as
described in the Prospectus, will constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with their
terms, except to the extent that enforceability may be limited by the
Enforceability Exceptions; and the Junior Subordinated Debentures will be
in the form contemplated by, and entitled to the benefits of, the Indenture
and will conform in all material respects to the descriptions thereof in
the Prospectus.
(xix) AUTHORIZATION OF TRUSTEES. Each of the Administrative
Trustees of the Trust is an officer of the Company and has been duly
authorized by the Company to execute and deliver the Declaration.
(xx) TRUST AND CORPORATION NOT INVESTMENT COMPANY. Neither the
Trust nor the Company is, and immediately following consummation of the
transactions contemplated hereby and the application of the net proceeds as
described in the Prospectus neither the Trust nor the Company will be, an
"investment company" or a company "controlled" by an
10
<PAGE>
"investment company" which is required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxi) ACCURACY OF DISCLOSURE. The Operative Documents conform in
all material respects to the descriptions thereof contained in the
Prospectus.
(xxii) ABSENCE OF DEFAULTS AND CONFLICTS. The Trust is not in
violation of the trust certificate of the Trust filed with the State of
Delaware (the "Trust Certificate") or the Declaration, and neither the
Company nor the Bank is in violation of its charter or by-laws; none of the
Trust, the Company or the Bank is in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which it is a party or by
which it or any of them may be bound, or to which any of its property or
assets is subject (collectively, "Agreements and Instruments") except for
such defaults under Agreements and Instruments that would not result in a
Material Adverse Effect; and the execution, delivery and performance of the
Operative Documents by the Trust or the Company, as the case may be, the
issuance, sale and delivery of the Preferred Securities, the Junior
Subordinated Debentures, the Preferred Securities Guarantee and the Common
Securities Guarantee, the consummation of the transactions contemplated by
the Operative Documents and compliance by the Offerors with the terms of
the Operative Documents to which they are a party have been duly authorized
by all necessary corporate action on the part of the Company and, at the
Closing Time, will have been duly authorized by all necessary action on the
part of the Trust and do not and will not, whether with or without the
giving of notice or passage of time or both, violate, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
under, or result in the creation or imposition of any security interest,
mortgage, pledge, lien, charge, encumbrance, claim or equitable right upon
any property or assets of the Trust, the Company or any of its subsidiaries
pursuant to any of the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company
or any of its subsidiaries or the Declaration or the Trust Certificate, or
violation by the Company or any of its subsidiaries of any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government authority,
11
<PAGE>
agency or instrumentality or court, domestic or foreign, including,
without limitation, the Board of Governors of the Federal
Reserve System, the Federal Deposit Insurance Corporation
and the Commissioner of Banks of the Commonwealth of Massachusetts, having
jurisdiction over the Trust, the Company, the Company's subsidiaries, or
their respective properties (collectively, "Governmental Entities"). As
used herein, a "Repayment Event" means any event or condition which gives
the holder of any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Trust, the Company or any of its subsidiaries.
(xxiii) ABSENCE OF LABOR DISPUTE. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent, which may reasonably be expected to
result in a Material Adverse Effect.
(xxiv) ABSENCE OF PROCEEDINGS. There is no action, suit,
proceeding, inquiry or investigation before or brought by any Governmental
Entity now pending, or, to the knowledge of the Trust or the Company,
threatened, against or affecting the Trust or the Company or any of its
subsidiaries, which is not disclosed in the Prospectus and which in the
reasonable judgment of the Trust or the Company might result in a Material
Adverse Effect, or which in the reasonable judgment of the Company might
materially and adversely affect the properties or assets thereof or the
consummation of the transactions contemplated by the Operative Documents or
the performance by the Trust or the Company of its obligations hereunder or
thereunder.
(xxv) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any Governmental Entity, other than those that
have been made or obtained, is necessary or required for the performance by
the Trust or the Company of their obligations under the Operative
Documents, as applicable, or the consummation by the Trust and the Company
of the transactions contemplated by the Operative Documents.
(xxvi) POSSESSION OF LICENSES AND PERMITS. The Trust, the
Company and the Bank possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses") issued by
the appropriate Governmental Entities necessary to conduct the business
12
<PAGE>
now operated by them; the Trust, the Company and the Bank are in compliance
with the terms and conditions of all such Governmental Licenses, except
where the failure so to comply would not, singly or in the aggregate have a
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not have a Material Adverse Effect; and neither the Trust,
the Company nor the Bank has received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, in the reasonable judgment of the Company, is
likely to result in a Material Adverse Effect.
(xxvii) NO OTHER AGREEMENTS. Other than such agreements,
contracts and other documents as are described in the Prospectus or
otherwise filed as exhibits to the Company's annual report on Form 10-K or
quarterly reports on Form 10-Q or current reports on Form 8-K incorporated
by reference in the Prospectus, there are no agreements, contracts or
documents of a character described in Item 601 of Regulation S-K of the
Commission to which the Company or the Bank is a party.
(xxviii) TITLE TO PROPERTY. The Company and its subsidiaries
have good and marketable title to all of their respective real and personal
properties, in each case free and clear of all liens, encumbrances and
defects, except as stated in the Prospectus, or such as do not materially
affect the value of such properties in the aggregate to the Company and its
subsidiaries considered as one enterprise; and all of the leases and
subleases material to the business of the Trust, and to the Company and its
subsidiaries, considered as one enterprise, and under which either of the
Offerors or any of such subsidiaries holds properties described in the
Prospectus, are in full force and effect and neither the Offerors nor such
subsidiaries have any notice of any material claim of any sort that has
been asserted by anyone adverse to the rights of the Offerors or such
subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of such entity to the continued
possession of the leased or subleased premises under any such lease or
sublease, which individually or in the aggregate might result in a Material
Adverse Effect.
(xxix) REGULATION M. The Company has not taken and will not
take, directly or indirectly, any action designed to, or that might be
13
<PAGE>
reasonably expected to, cause or result in stabilization or manipulation of
the price of the Preferred Securities.
(b) Any certificate signed by any Trustee of the Trust or any duly
authorized officer of the Company or any of its subsidiaries and delivered to
you or to counsel for the Underwriters shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Underwriters
as to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) INITIAL PREFERRED SECURITIES. On the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Trust agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and not jointly,
agrees to purchase from the Trust, at the purchase price of $25 per Initial
Preferred Security, the number of Initial Preferred Securities set forth in
Schedule A opposite the name of such Underwriter, plus any additional number
of Initial Preferred Securities which such Underwriter may become obligated
to purchase pursuant to the provisions of Section 10 hereof, subject, in each
case, to such adjustments among the Underwriters as they in their sole
discretion shall make to eliminate any sales or purchases of fractional
securities. As compensation to the Underwriters for their commitments
hereunder and in view of the fact that the proceeds of the sale of the
Preferred Securities will be used to purchase the Junior Subordinated
Debentures, the Company hereby agrees to pay at the Closing Time and at any
Date of Delivery to the Underwriters a commission of $______ per Preferred
Security purchased by the Underwriters.
(b) OPTIONAL PREFERRED SECURITIES. In addition, on the basis of
the representations and warranties herein contained and subject to the terms
and conditions herein set forth, the Trust hereby grants an option to the
Underwriters, severally and not jointly, to purchase up to 150,000 Optional
Preferred Securities at the price per share set forth in the immediately
preceding paragraph. The option hereby granted will expire 30 days after the
date hereof and may be exercised in whole or in part from time to time only
for the purpose of covering over-allotments which may be made in connection
with the offering and distribution of the Initial Preferred Securities upon
notice by the Underwriters to the Trust setting forth the number of Optional
Preferred Securities as to which the Underwriters are then exercising the
option and the time and date of payment and delivery for such Optional
Preferred Securities. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Underwriters, but
14
<PAGE>
shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time. If the option is
exercised as to all or any portion of the Optional Preferred Securities, each
of the Underwriters, acting severally and not jointly, will purchase and the
Trust agrees to sell to the Underwriters that proportion of the total number
of Optional Preferred Securities to be sold by the Trust which the number of
Initial Preferred Securities set forth in Schedule A opposite the name of
such Underwriter bears to the total number of Initial Preferred Securities,
subject in each case to such adjustments as the Underwriters in their
discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for the Initial Preferred Securities shall be made at the
offices of Skadden, Arps, Slate, Meagher & Flom LLP in New York, New York, or
at such other place as shall be agreed upon by the Underwriters and the
Offerors, at 9:00 a.m., New York, New York time, on May__, 1997 (unless
postponed in accordance with the provisions of Section 10 hereof), or such
other time not later than ten (10) business days after such date as shall be
agreed upon by the Underwriters and the Offerors (such time and date of
payment and delivery being herein called the "Closing Time").
In addition, in the event that any or all of the Optional Preferred
Securities are purchased by the Underwriters, payment of the purchase price
for, and delivery of certificates for, such Optional Preferred Securities
shall be made at the above-mentioned offices, or at such other place as shall
be agreed upon by the Underwriters and the Offerors on each Date of Delivery
as specified in the notice from the Underwriters to the Offerors.
Payment shall be made to the Trust by wire transfer of immediately
available funds, to the order of the Trust, to a bank designated by the
Company, against delivery to the Underwriters of certificates for the
Preferred Securities to be purchased by them. It is understood that each
Underwriter has authorized Legg Mason, for its account, to accept delivery
of, receipt for, and make payment of the Purchase Price for, the Initial
Preferred Securities and the Optional Preferred Securities, if any, which it
has agreed to purchase. Legg Mason, individually and not as representative
of the Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Initial Preferred Securities or the Optional Preferred
Securities, if any, to be purchased by any Underwriter whose funds have not
been received by the Closing Time or the relevant Date of Delivery, as the
case may be, but such payment shall not relieve such Underwriter from its
obligations hereunder.
15
<PAGE>
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial
Preferred Securities and the Optional Preferred Securities, if any, shall be
in such denominations and registered in such names as the Underwriters may
request in writing at least one business day before the Closing Time or the
relevant Date of Delivery, as the case may be. All such certificates shall
be made available for examination and packaging by the Underwriters in New
York, New York not later than 10:00 a.m. on the last business day prior to
the Closing Time or the relevant Date of Delivery, as the case may be.
As compensation to the Underwriters for their commitments hereunder
and in view of the fact that the proceeds of the sale of the Preferred
Securities will be used to purchase the Junior Subordinated Debentures of the
Company, the Company hereby agrees to pay at the Closing Time or each Date of
Delivery, as the case may be, to the Underwriters in immediately available
funds the commission payable at such time under this Section 2 to Legg Mason
on behalf of the Underwriters by wire transfer of immediately available funds.
SECTION 3. COVENANTS OF THE OFFERORS. The Offerors jointly and
severally covenant with each Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS.
The Company and the Trust, subject to Section 3(b) hereof, will comply with
the requirements of Rule 430A or Rule 434, as applicable, and will notify the
Underwriters immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectus or any amended Prospectus
shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or
for additional information, and (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary prospectus, or
of the suspension of the qualification of the Preferred Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of
any proceedings for any of such purposes. The Company and the Trust will
promptly effect the filings necessary pursuant to Rule 424(b) and will take
such steps as it deems necessary to ascertain promptly whether the form of
prospectus transmitted for filing under Rule 424(b) was received for filing
by the Commission and, in the event that it was not, it will promptly file
such prospectus. The Company and the Trust will make every
16
<PAGE>
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) FILING OF AMENDMENTS. The Company and the Trust will give the
underwriters notice of their intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)), any Term
Sheet or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or to
the Prospectus, whether pursuant to the 1933 Act or otherwise, will furnish
the Underwriters with copies of any such documents a reasonable amount of
time prior to such proposed filing or use, as the case may be, and will not
file or use any such document to which the Underwriters or counsel for the
Underwriters shall reasonably object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished
or will deliver to the Underwriters and counsel for the Underwriters, without
charge, two signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the Underwriters, without
charge, a conformed copy of the Registration Statement as originally filed
and of each amendment thereto (without exhibits) for each of the
Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the Underwrites will be substantively identical to the
electronically transmitted copies thereof filed with the Commission pursuant
to EDGAR, except to the extent permitted by Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Offerors, as promptly as
possible, will furnish to the Underwriters, without charge, such number of
copies of the preliminary prospectus, the Final Prospectus and any amendments
and supplements thereto and documents incorporated by reference therein as
the Underwriters may reasonably request, and the Company and the Trust hereby
consent to the use of such copies for purposes permitted by the 1933 Act.
The Company will furnish to each Underwriter, without charge, during the
period when the Prospectus is required to be delivered under the 1933 Act or
the Securities Exchange Act of 1934 (the "1934 Act"), such number of copies
of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be substantively identical to the
electronically transmitted copies thereof filed with the Commission pursuant
to EDGAR, except to the extent permitted by Regulation S-T.
17
<PAGE>
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company and the
Trust will comply with the 1933 Act and the 1933 Act Regulations so as to
permit the completion of the distribution of the Securities as contemplated
in this Agreement and in the Prospectus. If at any time when a prospectus is
required by the 1933 act to be delivered in connection with sales of the
Preferred Securities, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Company, to amend the Registration Statement or amend
or supplement the Prospectus in order that the Prospectus will not include
any untrue statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light
of the circumstances existing at the time it is delivered to a purchaser, or
if it shall be necessary, in the opinion of such counsel, at any such time to
amend the Registration Statement or amend or supplement the Prospectus in
order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company and the Trust will promptly prepare and file with
the Commission, subject to Section 3(b) hereof, such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and
the Company will furnish to the Underwriters such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company and the Trust will each
use its best efforts, in cooperation with the Underwriters, to qualify the
Preferred Securities for offering and sale under the applicable securities
laws of such states and other jurisdictions as the Underwriters may
reasonably designate and to maintain such qualifications in effect for a
period of not less than one year from the later of the effective date of the
Registration Statement and any Rule 462(b) Registration Statement; provided,
however, that neither the Company nor the Trust shall be obligated to file
any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is
not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Preferred Securities have been so qualified,
the Company and the Trust will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification in
effect for a period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
18
<PAGE>
(g) RULE 158. The Company will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(h) NOTICE AND EFFECT OF MATERIAL EVENTS. The Offerors will
immediately notify the Underwriters, and confirm such notice in writing, of
(x) any filing made by the Offerors of information relating to the offering
of the Preferred Securities with any securities exchange or any other
regulatory body in the United States, and (y) prior to the completion of the
distribution of the Preferred Securities by the Underwriters as evidenced by
a notice in writing from the Underwriters to the Offerors, any Material
Adverse Effect, which (i) makes any statement in the Prospectus false or
misleading or (ii) is not disclosed in the Prospectus. In such event or if
during such time any event shall occur as a result of which it is necessary,
in the reasonable opinion of the Company, its counsel or the Underwriters or
counsel to the Underwriters, to amend or supplement the Final Prospectus in
order that the Final Prospectus not include any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances then
existing, the Company will forthwith amend or supplement the Final Prospectus
by preparing and furnishing to the Underwriters an amendment or amendments
of, or a supplement or supplements to, the Final Prospectus (in form and
substance satisfactory in the reasonable opinion of counsel for the
Underwriters) so that, as so amended or supplemented, the Final Prospectus
will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light
of the circumstances existing at the time it is delivered to a Subsequent
Purchaser, not misleading.
(i) RATING. The Offerors shall take all reasonable action
necessary to enable Duff & Phelps to provide its credit rating of the
Preferred Securities.
(j) DTC. The Offerors will cooperate with the Underwriters and use
their best efforts to permit the Preferred Securities to be eligible for
clearance and settlement through the facilities of DTC.
(k) USE OF PROCEEDS. The Trust will use the proceeds received by
it from the sale of the Securities in the manner specified in the Prospectus
under "Use of Proceeds." The Company will use the net proceeds received by it
19
<PAGE>
from the sale of the Junior Subordinated Debentures, in the manners
specified in the Prospectus under "Use of Proceeds."
(l) LISTING. The Company will use its best efforts to effect the
listing of the Preferred Securities on the National Association of Securities
Dealers Automated Quotation System ("NASDAQ"). If the Junior Subordinated
Debentures are distributed on the occurrence of a Tax Event (as defined in
the Prospectus), the Company will use its best efforts to effect the listing
of the Junior Subordinated Debentures on NASDAQ on such other exchange where
the Preferred Securities are listed.
(m) RESTRICTION ON SALE OF SECURITIES. During a period of 90 days
from the date of the Prospectus, neither the Company nor the Trust will,
without the prior written consent of Legg Mason, (i) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase or otherwise transfer or dispose of any Preferred
Securities or Junior Subordinated Debentures (or any equity or debt
securities substantially similar to the Preferred Securities or Junior
Subordinated Debentures, respectively) or any capital stock of the Company,
or any securities convertible into or exercisable or exchangeable for
Preferred Securities or Junior Subordinated Debentures (or any equity or debt
securities substantially similar to the Preferred Securities or Junior
Subordinated Debenture, respectively) or file any registration statement
under the 1933 Act with respect to any of the foregoing or (ii) enter into
any swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership of
Preferred Securities or Junior Subordinated Debentures (or any equity or debt
securities substantially similar to the Preferred Securities or Junior
Subordinated Debentures, respectively) or any capital stock of the Company,
whether any such swap or transaction described in clause (i) or (ii) above is
to be settled by delivery of Preferred Securities or Junior Subordinated
Debentures (or any equity or debt securities substantially similar to the
Preferred Securities or Junior Subordinated Debentures, respectively) or such
other securities, in cash or otherwise. The foregoing sentence shall not
apply to the Preferred Securities or Junior Subordinated Debentures to be
sold hereunder.
(n) REPORTING REQUIREMENTS. The Company and the Trust, during the
period when the Prospectus is required to be delivered under the 1933 Act or
the 1934 Act, will file all documents required to be filed with the
Commission pursuant to Section 13, 14 or 15 of the 1934 Act within the time
periods required by the 1934 Act and the 1934 Act Regulations.
20
<PAGE>
(o) FURNISH REPORTS. For and during the period ending three years
after the effective date of the Registration Statement, the Company will
furnish to the Underwriters copies of all reports and other communications
(financial or otherwise) furnished by the Company to its securityholders
generally and copies of any reports or financial statements furnished to or
filed by the Company with the Commission or any national securities exchange
on which any class of securities of the Company may be listed.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company, as borrower under the Junior
Subordinated Debentures, will pay all expenses incident to the performance of
its, and the Trust's, obligations under this Agreement, including (i) the
preparation, printing and any filing of the Registration Statement (including
financial statements and any schedules or exhibits and any document
incorporated therein by reference) and of each amendment or supplement
thereto, (ii) the preparation, printing and delivery to the Underwriters of
this Agreement, the Operative Documents and such other documents as may be
required in connection with the offering, purchase, sale and delivery of the
Preferred Securities, (iii) the preparation, issuance and delivery of the
certificates for the Preferred Securities to the Underwriters, including any
stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance, or delivery of the Preferred Securities to the Underwriters,
(iv) the fees and disbursements of the Company's counsel, accountants and
other advisors, (v) rating agency fees, (vi) the fees and expenses of any
trustee appointed under any of the Operative Documents, including the fees
and disbursements of counsel for such trustees in connection with the
Operative Documents, (vii) the fees and disbursements up to $ of
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Underwriters,
(viii) the qualification of the Preferred Securities under securities laws in
accordance with the provisions of Section 3(f) hereof, 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 and any supplement thereto, if any, (ix) the printing and delivery to
the Underwriters of copies of each preliminary prospectus, any Term Sheets
and of the Prospectus and any amendments or supplements thereto, if any, (x)
the preparation, printing and delivery supplement thereto, if any, (xi) the
fees and expenses of any transfer agent or registrar for the Preferred
Securities, (xii) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review
by the National Association of Securities Dealers, Inc. (the "NASD") of the
terms of the sale of the Preferred Securities, (xiii) the fees and expenses
incurred in connection with the listing of the Preferred Securities and, if
21
<PAGE>
applicable, the Junior Subordinated Debentures on NASDAQ, (xiv) the fees and
expenses of the Indenture Trustee, including the fees and disbursements of
counsel for the Indenture Trustee in connection with the Indenture and the
Junior Subordinated Debentures, (xv) the fees and expenses of the Delaware
Trustee and the Property Trustee, including the fees and disbursements of
counsel for the Delaware Trustee and Property Trustee in connection with the
Declaration and the Certificate of Trust, (xvi) the fees and expenses of the
Guarantee Trustee, (xvii) any fees and expenses in connection with the rating
of the Preferred Securities and the Junior Subordinated Debentures and
(xviii) the cost and charges of qualifying the Preferred Securities with the
Depositary Trust Company.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Underwriters in accordance with the provisions of Section 5, Section 9(a)(i) or
Section 10 hereof, the Company shall reimburse the Underwriters for all of their
reasonable, actual, accountable out-of-pocket expenses, including the reasonable
fees and disbursements of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for
the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Offerors contained in Section 1 hereof
or in certificates of any Trustee of the Trust, officer of the Corporation or
any of its subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Offerors of their obligations hereunder, and to the
following further conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any
request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430A Information shall have
been filed with the Commission in accordance with Rule 424(b) (or a
post-effective amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule 430(a) or, if
the Company has elected to rely upon Rule 434, a Term Sheet shall have been
filed with the Commission in accordance with Rule 424(b)).
22
<PAGE>
(b) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. At the Closing Time,
the Underwriters shall have received the favorable opinion, dated as of the
Closing Time, of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the
Offerors, substantially in the form of Exhibit A attached hereto. Such
counsel may state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of
Trustees of the Trust, officers of the Corporation or any designated
subsidiary and certificates of public officials. Such counsel may also state
that, insofar as such opinion involves matters of Massachusetts law, they
have relied, to the extent they deem proper, on local Massachusetts counsel
acceptable to the Underwriters.
(c) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. At the
Closing Time, the Underwriters shall have received the favorable opinion,
dated as of the Closing Time, of Skadden, Arps, Slate, Meagher & Flom
(Delaware), special Delaware counsel for the Offerors, in form and substance
reasonably satisfactory to the Underwriters.
(d) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. At the Closing
Time, the Underwriters shall have received the favorable opinion, dated as of
the Closing Time, of Emmet, Marvin & Martin, LLP, counsel to The Bank of New
York, as Property Trustee under the Declaration, Guarantee Trustee under the
Preferred Securities Guarantee Agreement and Debenture Trustee under the
Indenture, in form and substance reasonably satisfactory to counsel for the
Underwriters.
(e) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. At the
Closing Time, the Underwriters shall have received an opinion, dated as of
the Closing Time, of Elias, Matz, Tiernan & Herrick L.L.P., special tax
counsel to the Offerors, substantially to the effect that (i) the Junior
Subordinated Debentures will be classified as indebtedness for United States
federal income tax purposes, (ii) the Trust will be classified as a grantor
trust for United States federal income tax purposes, and (iii) the statements
set forth in the Prospectus under the caption "Certain Federal Income Tax
Consequences" constitute, in all material respects, a fair and accurate
summary of the United stated federal income tax consequences of the ownership
and disposition of the Preferred Securities under current law. Such opinion
may be conditioned on, among other things, the initial and continuing
accuracy of the facts, financial and other information, covenants and
representations set forth in certificates of officers of the Corporation and
other documents deemed necessary for such opinion.
23
<PAGE>
(f) OPINION OF COUNSEL FOR THE UNDERWRITERS. At the Closing Time,
the Underwriters shall have received the favorable opinion, dated as of the
Closing Time, of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
Underwriters, with respect to the Preferred Securities, the Operative
Documents, the Prospectus and other related matters as the Underwriters may
require. Such counsel may also state that, insofar as such opinion involves
factual matters, they have relied, to the extent they deem proper, upon
certificates of Trustees of the Trust, officers of the Company or the Bank
and certificates of public officials.
(g) CERTIFICATES. At the Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information
is given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Trust, or the Company and its subsidiaries, considered as
one enterprise, whether or not arising in the ordinary course of business,
and the Underwriters shall have received a certificate of the Chairman, the
Chief Executive Officer, the President or any Vice President of the
Corporation and of the Chief Financial Officer of the Corporation and a
certificate of an Administrative Trustee of the Trust, dated as of the
Closing Time, to the effect that, to his or her knowledge (i) there has been
no such material adverse change (ii) the representations and warranties in
Section 1 hereof were true and correct when made and are true and correct
with the same force and effect as though expressly made at and as of the
Closing Time, and (iii) the Offerors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or
prior to the Closing Time.
(h) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of
this Agreement, the Initial Purchaser shall have received from Arthur
Andersen, LLP (the "Accountants") a letter dated such date, in form and
substance satisfactory to the Underwriters, containing statements and
information of the type ordinarily included in accountants' "comfort letters"
to Underwriters with respect to the financial statements and certain
financial information included or incorporated by reference in the Prospectus.
(i) BRING-DOWN COMFORT LETTER. At the Closing Time, the
Underwriters shall have received from the Accountants a letter dated as of
the Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (h) of this Section, except that the
specified date referred to shall be a date not more than three business days
prior to the Closing Time.
24
<PAGE>
(j) MAINTENANCE OF RATING. At the Closing Time, the Preferred
Securities shall be rated at least BB- by Duff & Phelps, and the Trust shall
have delivered to the Underwriters a letter dated the Closing Time, from such
rating agency, or other evidence satisfactory to the Underwriters, confirming
that the Preferred Securities have such a rating; and between the date of this
Agreement and the Closing Time, there shall not have occurred a downgrading in
such rating assigned to the Preferred Securities or the rating assigned to any
of the Company's other debt securities by any nationally recognized statistical
rating organization, and no such organization shall have publicly announced that
it has under surveillance or review its rating of any of the Preferred
Securities or any of the Company's other debt securities.
(k) APPROVAL OF LISTING. At the Closing Time, the Preferred
Securities shall have been approved for listing on NASDAQ.
(l) CONDITIONS TO PURCHASE OF OPTIONAL PREFERRED SECURITIES. In
the event that the Underwriters exercise their option provided in Section
2(b) hereof to purchase all or any portion of the Optional Preferred
Securities, the representations and warranties of the Company and the Trust
contained herein and the statements in any certificates furnished by the
Company and any Trustee hereunder shall be true and correct as of each Date
of Delivery and, at the relevant Date of Delivery, the Underwriters shall
have received:
(i) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. The favorable
opinion of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the Offerors,
in form and substance satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Optional Preferred Securities to be
purchased on such Date of Delivery and otherwise to the same effect as the
opinion required by Section 5(b) hereof.
(ii) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. The
favorable opinion, dated such Date of Delivery, of Skadden, Arps, Slate,
Meagher & Flom (Delaware), special Delaware counsel for the Offerors, in
form and substance satisfactory to counsel for the Underwriters, relating
to the Optional Preferred Securities to be purchased on such Date of
Delivery and otherwise to the same effects as the opinion required by
Section 5(c) hereof.
(iii) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. The favorable
opinion, dated such Date of Delivery, of Emmet, Marvin & Martin, LLP,
counsel to The Bank of New York, as Property Trustee
25
<PAGE>
under the Declaration, Guarantee Trustee under the Preferred Securities
Guarantee Agreement and Debenture Trustee under the Indenture, in
form and substance satisfactory to counsel for the Underwriters,
relating to the Optional Preferred Securities to be Purchased
on such Date of Delivery and otherwise to the same effect
as the opinion required by Section 5(d) hereof.
(iv) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. The
favorable opinion, dated such Date of Delivery, of Elias, Matz, Tiernan &
Herrick L.L.P., special tax counsel to the Offerors, in form and substance
satisfactory to counsel for the Underwriters, relating to the Optional
Preferred Securities to be purchased on such Date of Delivery and otherwise
to the same effect as the opinion required by Section 5(e) hereof.
(v) OPINION OF COUNSEL FOR THE UNDERWRITERS. The favorable
opinion, dated such Date of Delivery, of Skadden, Arps, Slate, Meagher &
Flom LLP, counsel for the Underwriters, relating to the Optional Preferred
Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(f) hereof.
(vi) CERTIFICATES. Certificates, dated such Date of Delivery, of
the Chairman, the Chief Executive Officer, the President or any Vice
President of the Company and of the Chief Financial Officer of the Company
and a certificate of an Administrative Trustee of the Trust, confirming
that the certificates delivered at the Closing Time pursuant to Section
5(g) hereof remain true and correct as of such Date of Delivery.
(vii) BRING-DOWN COMFORT LETTER. A letter from the Accountants
dated such Date of Delivery, in form and substance satisfactory to the
Underwriters, substantially in the same form and substance as the letter
furnished to the Underwriters pursuant to Section 5(i) hereof, except that
the specified date referred to shall be a date not more than five days
prior to such Date of Delivery.
(m) ADDITIONAL DOCUMENTS. At the Closing Time, counsel for the
Underwriters shall have been furnished such documents and opinions as they
may reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Preferred Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties of
the Offerors, or the fulfillment of any of the conditions, herein contained;
and all proceedings
26
<PAGE>
taken by the Offerors in connection with the issuance and sale of the
Preferred Securities as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
(n) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Underwriters by notice to the
Offerors at any time at or prior to the Closing Time, and such termination
shall be without liability of any party to any other party except as provided
in Section 4 hereof and except that Sections 7 and 8 hereof shall survive any
such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Offerors agree to jointly
and severally indemnify and hold harmless (x) each Underwriter, (y) each
person, if any, who controls any Underwriter within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act (each such person, a "Control
Person") and (z) the respective partners, directors, officers, employees and
agents of each Underwriter or any Control Person as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment or supplement thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or the omission or
alleged omission therefrom of a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or arising out of
any untrue statement of a material fact contained in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission; provided that (subject to
27
<PAGE>
Section 6(d) below) any such settlement is effected with the written
consent of the Offerors; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Underwriters), reasonably incurred in investigating, preparing for or
defending against any litigation or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission to the extent that any such expense is
not paid under (i) or (ii) above; provided, however, that this indemnity
agreement shall not apply to any loss, liability, claim, damage or expense
to the extent arising out of any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with
written information furnished to the Offerors by any Underwriter through
Legg Mason expressly for use in the Registration Statement (or any
amendment thereto), including the Rule 430A Information an the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto). The foregoing indemnity with
respect to any untrue statement or alleged untrue statement contained in or
omission or alleged omission from a preliminary prospectus shall not inure
to the benefit of the Underwriter (or any person controlling such
Underwriter) from whom the person asserting any loss, liability, claim,
damage or expense purchases any of the Preferred Securities which are the
subject thereof if the Company shall sustain the burden of proving that
such person was not sent or given a copy of the Prospectus (or the
Prospectus as amended or supplemented) at or prior to the written
confirmation of the sale of such Securities to such person and the untrue
statement contained in or omission from such preliminary prospectus was
corrected in the Prospectus (or the Prospectus as amended or supplemented)
and the Company has previously furnished copies thereof to such
Underwriter.
(b) INDEMNIFICATION OF OFFERORS, DIRECTORS, OFFICERS AND EMPLOYEES.
Each Underwriter severally agrees to indemnify and hold harmless the Company,
its directors, officers and employees, the Trust, each of the Trustees and each
person, if any, who controls the Trust, any of the Trustees or the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in Section 6(a) above, as incurred, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions, made
in the Registration Statement (or any amendment thereto), including
28
<PAGE>
the Rule 430A Information and the Rule 434 Information, if applicable, or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information
furnished to the Offerors by such Underwriter through Legg Mason expressly
for use in the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it
is not materially prejudiced as a result thereof, and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. An indemnifying party may participate at its own
expense in the defense of any such action or, if it so elects within a
reasonable time after receipt of such notice, to assume the defense of any
suit brought to enforce any such claim, but if it so elects to assume the
defense, such defense shall be conducted by counsel chosen by it and approved
by the indemnified parties, which approval shall not be unreasonably
withheld. In the event that an indemnifying party elects to assume the
defense of any such suit and retain such counsel, the indemnified party or
parties shall bear the fees and expenses of any additional counsel thereafter
retained by such indemnified party or parties; provided, however, that the
indemnified party or parties shall have the right to employ counsel (in
addition to local counsel) to represent the indemnified party or parties who
may be subject to liability arising out of any action in respect of which
indemnity may be sought against the indemnifying party if, in the reasonable
judgement of counsel for the indemnified party or parties, there may be legal
defenses available to such indemnified person which are different from or in
addition to those available to such indemnifying person, in which event the
reasonable fees and expenses of appropriate separate counsel shall be borne
by the indemnifying party. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any
local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written
consent of the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution
could be sought under this Section 6 or Section 7 hereof (whether or
29
<PAGE>
not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release
of each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as
to or an admission of fault, culpability or a failure to act by or on behalf
of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent
if (i) such settlement is entered into more than 45 days after receipt by
such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with
such request prior to the date of such settlement. Notwithstanding the
immediately preceding sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel, an indemnifying party shall not be liable for
any settlement of the nature contemplated by Section 6(a)(ii) effected
without its consent if such indemnifying party (i) reimburses such
indemnified party in accordance with such request to the extent the
indemnifying party in its judgement considers such request to be reasonable
and (ii) provides written notice to the indemnified party stating the reason
it deems the unpaid balance unreasonable, in each case prior to the date of
such settlement.
SECTION 7. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances under which the indemnification provided for in
Section 6 hereof is for any reason held to be unenforceable by an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors on the
one hand and the Underwriters on the other hand from the offering of the
Preferred Securities pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Offerors, on the one
hand, and of the Underwriters, on the other hand, in connection with
30
<PAGE>
the statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Offerors on the one hand and the
Underwriters on the other hand in connection with the offering of the
Preferred Securities pursuant to this Agreement shall be deemed to be in the
same respective proportions as the total net proceeds from the offering of
the Preferred Securities pursuant to this Agreement (before deducting
expenses) received by the Offerors and the total commission received by the
Underwriters, bear to the aggregate initial offering price of the Preferred
Securities.
The relative fault of the Offerors, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statements of a
material fact or omission or alleged omission to state a material fact
relates to information supplied by the Offerors or by the Underwriters and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Offerors and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section 7.
The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, the Underwriters shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Preferred Securities purchased by it and distributed
to the public were offered to the public exceeds the amount of any damages
which the Underwriters has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
31
<PAGE>
For purposes of this Section 7, each person, if any, who controls the
Underwriters within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act and the respective partners, directors, officers, employees
and agents of the Underwriters shall have the same rights to contribution as
the Underwriters, and each officer and director of the Company, and each
person, if any, who controls the Company within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or trustees of the
Trust submitted pursuant hereto, shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Trust or the
Company, and shall survive delivery of the Preferred Securities to the
Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Underwriters may terminate this
Agreement, by notice to the Offerors, at any time at or prior to the Closing
Time (i) if there has occurred, since the time of execution of this Agreement
or since the respective dates as of which information is given in the
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Trust or the Company and its subsidiaries, considered as one enterprise,
whether or not arising in the ordinary course of business or (ii) if there
has occurred any material adverse change in the financial markets in the
United States, any outbreak of hostilities or escalation thereof or other
calamity or crisis, or any change or development involving a prospective
change in national political, financial or economic conditions, in each case
the effect of which is such as to make it, in the judgment of the
Underwriters, impracticable to market the Preferred Securities or to enforce
contracts for the sale of the Preferred Securities, or (iii) if trading in
any securities of the Company has been suspended or limited by the
Commission, or if trading generally on the American Stock Exchange, the New
York Stock Exchange or NASDAQ has been suspended or limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) if a banking moratorium has been declared by
either federal or Massachusetts authorities.
32
<PAGE>
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any
other party except as provided in Section 4 hereof, and provided further that
Sections 1, 6 and 7 hereof shall survive such termination and remain in full
force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one of the
Underwriters shall fail at Closing Time or a Date of Delivery to purchase the
Preferred Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the remaining Underwriter shall have
the right, within 24 hours thereafter, to make arrangement, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, such
Underwriter shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of
the number of Preferred Securities to be purchased on such date, the
non-defaulting Underwriter shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of
the non-defaulting Underwriter, or
(b) if the number of Defaulted securities exceeds 10% of the number
of Preferred Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Optional Preferred Securities to be purchased and sold on such Date of
Delivery shall terminate without liability on the part of the non-defaulting
Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement or, in the case of a Date of Delivery which is
after the Closing Time, which does not result in a termination of the
obligation of the underwriters to purchase and the Company to sell the
relevant Optional Preferred Securities, as the case may be, either the
underwriters or the Company shall have the right to postpone Closing Time or
the relevant Date of Delivery, as the case may be, for required changes in
the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
33
<PAGE>
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to Legg Mason Wood Walker Incorporated, 1747
Pennsylvania Avenue N.W., Washington, D.C. 20006, Attention Mark C. Micklem,
Managing Director, with a copy to Skadden, Arps, Slate, Meagher & Flom LLP,
919 Third Avenue, New York, New York 10022, Attention: Vincent J. Pisano,
Esq.; notices to the Offerors shall be directed to Independent Bank Corp.,
288 Union Street, Rockland, Massachusetts, 02370, Attention: Richard J.
Seaman, with a copy to Elias, Matz, Tiernan & Herrick L.L.P., The Walker
Building, 734 15th Street, NW, 12th Floor, Washington, DC 20005, Attention:
Norman B. Antin, Esq.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and
be binding upon each of the Underwriters and the Offerors and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters and the Offerors and their respective successors and
the controlling persons and officers and directors referred to in Sections 1,
6 and 7 hereof and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the
Underwriters and the Offerors and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of Preferred Securities from the Underwriters shall be deemed
to be a successor by reason merely of such purchase.
The Company, on behalf of itself and its subsidiaries (including, without
limitation, the Trust), hereby irrevocably submits to the exclusive
jurisdiction of the federal and New York State courts located in the City of
New York in connection with any suit, action or proceeding related to this
agreement or any of the matters contemplated hereby, irrevocably waives any
defense of lack of personal jurisdiction and irrevocably agrees that all
claims in respect of any suit, action or proceeding may be heard and
determined in any such court. The Company, on behalf of itself and the
subsidiaries (including, without limitation, the Trust), irrevocably waives,
to the fullest extent it may effectively do so under applicable law, any
objection which it may now or hereafter have to the laying of venue of any
such suit, action or proceeding brought in any such court and any claim that
any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum.
34
<PAGE>
SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO CONFLICT OF LAW PRINCIPLES.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
35
<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 Offerors in accordance with its
terms.
Very truly yours,
INDEPENDENT BANK CORP.
By
------------------------------
Name: Richard J. Seaman
Title: Chief Financial Officer
INDEPENDENT CAPITAL TRUST I
By
-------------------------------
Name: Richard J. Seaman
Title: Administrative Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
LEGG MASON WOOD WALKER INCORPORATED
By
-------------------------------
Authorized Signatory
36
<PAGE>
SCHEDULE A
Number of
Initial
Preferred
Name of Underwriter Securities
- ------------------- -------------
Legg Mason Wood Walker Incorporated..................
Piper Jaffray, Inc...................................
Total................................................ ---------------
1,000,000
---------------
i
<PAGE>
================================================================================
INDEPENDENT BANK CORP.
------------------------------
------------------------------
INDENTURE
Dated as of May __, 1997
------------------------------
THE BANK OF NEW YORK
as Trustee
------------------------------
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
================================================================================
<PAGE>
TIE-SHEET
of provisions of Trust Indenture Act of 1939 with Indenture dated as of May
__, 1997 between Independent Bank Corp. and The Bank of New York, Trustee:
ACT SECTION INDENTURE SECTION
310(a)(1).................................................................6.09
310(a)(2) ................................................................6.09
310(a)(3)..................................................................N/A
310(a)(4)..................................................................N/A
310(a)(5)...........................................................6.10, 6.11
310(b).....................................................................N/A
310(c)....................................................................6.13
311(a) and (b).............................................................N/A
311(c)...........................................................4.01, 4.02(a)
312(a)....................................................................4.02
312(b) and (c)............................................................4.04
313(a)....................................................................4.04
313(b)(1).................................................................4.04
313(b)(2).................................................................4.04
313(c)....................................................................4.04
313(d)....................................................................4.04
314(a)....................................................................4.03
314(b).....................................................................N/A
314(c)(1) and (2).........................................................6.07
314(c)(3)..................................................................N/A
314(d) ....................................................................N/A
314(e)....................................................................6.07
314(f) ....................................................................N/A
315(a)(c) and (d).........................................................6.01
315(b) ...................................................................5.08
315(e) ...................................................................5.09
316(a)(1) ................................................................5.07
316(a)(2) .................................................................N/A
316(a) last sentence .....................................................2.09
316(b) ...................................................................9.02
317(a) ...................................................................5.05
317(b) ...................................................................6.05
318(a) ..................................................................13.08
- ----------
THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
<PAGE>
TABLE OF CONTENTS*
Page
----
ARTICLE I
DEFINITIONS.............................. 1
SECTION 1.01. Definitions........................................ 1
Additional Sums...................................................... 1
Affiliate .......................................................... 1
Allocable Amounts.................................................... 1
Authenticating Agent................................................. 2
Bankruptcy Law....................................................... 2
Board of Directors................................................... 2
Board Resolution..................................................... 2
Business Day......................................................... 2
Commission .......................................................... 2
Common Securities.................................................... 2
Common Securities Guarantee.......................................... 3
Common Stock......................................................... 3
Company .......................................................... 3
Company Request...................................................... 3
Compounded Interest.................................................. 3
Custodian .......................................................... 3
Declaration.......................................................... 3
Default .......................................................... 3
Deferred Interest.................................................... 3
Definitive Securities................................................ 3
Depositary .......................................................... 3
Dissolution Event.................................................... 3
Event of Default..................................................... 4
Exchange Act......................................................... 4
Extended Interest Payment Period..................................... 4
Federal Reserve...................................................... 4
Global Security...................................................... 4
Indebtedness ....................................................... 4
Indenture .......................................................... 4
Independent Capital Trust or the Trust............................... 4
Interest Payment Date................................................ 4
Investment Company Event............................................ 5
- ----------
* THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO BE A PART
OF THE INDENTURE.
i
<PAGE>
Page
----
Maturity Date........................................................ 5
Mortgage .......................................................... 5
Non Book-Entry Capital Securities.................................... 5
Officers .......................................................... 5
Officers' Certificate................................................ 5
Opinion of Counsel................................................... 5
Other Debentures..................................................... 5
Other Guarantees..................................................... 5
outstanding.......................................................... 5
Person .......................................................... 6
Predecessor Security................................................. 6
Preferred Securities................................................ 7
Preferred Securities Guarantee...................................... 7
Principal Office of the Trustee...................................... 7
Property Trustee..................................................... 7
Redemption Date...................................................... 7
Redemption Price..................................................... 7
Regulatory Capital Event............................................. 7
Responsible Officer.................................................. 7
Securities .......................................................... 7
Securities Act....................................................... 8
Securityholder or holder of Securities............................... 8
Security Register.................................................... 8
Senior and Subordinated Indebtedness................................. 8
Special Event....................................................... 8
Subsidiary .......................................................... 8
Tax Event .......................................................... 9
Trust Indenture Act of 1939.......................................... 9
Trustee .......................................................... 9
Trust Securities..................................................... 9
Underwriting Agreement............................................... 9
U.S. Government Obligations.......................................... 9
ARTICLE II
SECURITIES............................... 10
SECTION 2.01. Forms Generally.................................... 10
SECTION 2.02. Execution and Authentication....................... 10
SECTION 2.03. Form and Payment................................... 10
SECTION 2.04. Global Security.................................... 11
SECTION 2.05 Interest........................................... 12
SECTION 2.06. Transfer and Exchange.............................. 13
SECTION 2.07. Replacement Securities............................. 14
ii
<PAGE>
Page
----
SECTION 2.08. Temporary Securities............................... 15
SECTION 2.09. Cancellation....................................... 15
SECTION 2.10. Defaulted Interest................................. 15
SECTION 2.11. CUSIP Numbers...................................... 16
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY.................. 17
SECTION 3.01. Payment of Principal and Interest.................. 17
SECTION 3.02. Offices for Notices and Payments, etc.............. 17
SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office. 18
SECTION 3.04. Provision as to Paying Agent....................... 18
SECTION 3.05. Certificate to Trustee............................. 19
SECTION 3.06. Compliance with Consolidation Provisions........... 19
SECTION 3.07. Limitation on Dividends............................ 19
SECTION 3.08. Covenants as to Independent Capital Trust.......... 20
SECTION 3.09. Payment of Expenses................................ 20
SECTION 3.10. Payment Upon Resignation or Removal................ 21
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE........................ 21
SECTION 4.01. Securityholders' Lists............................. 21
SECTION 4.02. Preservation and Disclosure of Lists............... 22
SECTION 4.03. Reports by Company................................. 23
SECTION 4.04. Reports by the Trustee............................. 24
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT.......................... 25
SECTION 5.01. Events of Default.................................. 25
SECTION 5.02. Payment of Securities on Default; Suit Therefor.... 27
SECTION 5.03. Application of Moneys Collected by Trustee......... 28
SECTION 5.04. Proceedings by Securityholders..................... 29
SECTION 5.05. Proceedings by Trustee............................. 30
SECTION 5.06. Remedies Cumulative and Continuing................. 30
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders........................ 31
SECTION 5.08. Notice of Defaults................................. 31
SECTION 5.09. Undertaking to Pay Costs........................... 32
iii
<PAGE>
Page
----
ARTICLE VI
CONCERNING THE TRUSTEE......................... 32
SECTION 6.01. Duties and Responsibilities of Trustee............. 32
SECTION 6.02. Reliance on Documents, Opinions, etc............... 34
SECTION 6.03. No Responsibility for Recitals, etc................ 35
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents,
Transfer Agents or Registrar May Own Securities.... 36
SECTION 6.05. Moneys to be Held in Trust......................... 36
SECTION 6.06. Compensation and Expenses of Trustee............... 36
SECTION 6.07. Officers' Certificate as Evidence.................. 37
SECTION 6.08. Conflicting Interest of Trustee.................... 37
SECTION 6.09. Eligibility of Trustee............................. 37
SECTION 6.10. Resignation or Removal of Trustee.................. 38
SECTION 6.11. Acceptance by Successor Trustee.................... 39
SECTION 6.12. Succession by Merger, etc.......................... 40
SECTION 6.13. Limitation on Rights of Trustee as a Creditor...... 40
SECTION 6.14. Authenticating Agents.............................. 41
ARTICLE VII
CONCERNING THE SECURITYHOLDERS..................... 42
SECTION 7.01. Action by Securityholders.......................... 42
SECTION 7.02. Proof of Execution by Securityholders.............. 42
SECTION 7.03. Who Are Deemed Absolute Owners..................... 43
SECTION 7.04. Securities Owned by Company Deemed Not
Outstanding........................................ 43
SECTION 7.05. Revocation of Consents; Future Holders Bound....... 44
ARTICLE VIII
SECURITYHOLDERS' MEETINGS....................... 44
SECTION 8.01. Purposes of Meetings............................... 44
SECTION 8.02. Call of Meetings by Trustee........................ 45
SECTION 8.03. Call of Meetings by Company or Securityholders..... 45
SECTION 8.04. Qualifications for Voting.......................... 45
SECTION 8.05. Regulations........................................ 45
SECTION 8.06. Voting............................................. 46
iv
<PAGE>
Page
----
ARTICLE IX
AMENDMENTS............................... 47
SECTION 9.01. Without Consent of Securityholders................. 47
SECTION 9.02. With Consent of Securityholders.................... 48
SECTION 9.03. Compliance with Trust Indenture Act; Effect of
Supplemental Indentures............................ 49
SECTION 9.04. Notation on Securities............................. 50
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished Trustee.................. 50
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE........... 50
SECTION 10.01. Company May Consolidate, etc., on Certain Terms.... 50
SECTION 10.02. Successor Corporation to be Substituted for
Company ........................................... 51
SECTION 10.03. Opinion of Counsel to be Given Trustee............. 51
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE................ 52
SECTION 11.01. Discharge of Indenture............................. 52
SECTION 11.02. Deposited Moneys and U.S. Government Obligations to
be Held in Trust by Trustee........................ 52
SECTION 11.03. Paying Agent to Repay Moneys Held.................. 53
SECTION 11.04. Return of Unclaimed Moneys......................... 53
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S.
Government Obligations............................. 53
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS......................... 55
SECTION 12.01. Indenture and Securities Solely Corporate
Obligation ........................................ 55
ARTICLE XIII
MISCELLANEOUS PROVISIONS........................... 55
SECTION 13.01. Successors......................................... 55
SECTION 13.02. Official Acts by Successor Corporation............. 55
SECTION 13.03. Surrender of Company Powers........................ 56
SECTION 13.04. Addresses for Notices, etc......................... 56
v
<PAGE>
Page
----
SECTION 13.05. Governing Law...................................... 56
SECTION 13.06. Evidence of Compliance with Conditions Precedent... 56
SECTION 13.07. Business Days...................................... 57
SECTION 13.08. Trust Indenture Act to Control..................... 57
SECTION 13.09. Table of Contents, Headings, etc................... 57
SECTION 13.10. Execution in Counterparts.......................... 57
SECTION 13.11. Separability....................................... 57
SECTION 13.12. Assignment......................................... 58
SECTION 13.13. Acknowledgement of Rights.......................... 58
ARTICLE XIV
REDEMPTION OF SECURITIES.......................... 58
SECTION 14.01. Special Event Redemption........................... 58
SECTION 14.02. Optional Redemption by Company..................... 59
SECTION 14.03. No Sinking Fund.................................... 59
SECTION 14.04. Notice of Redemption; Selection of Securities...... 59
SECTION 14.05. Payment of Securities Called for Redemption........ 60
ARTICLE XV
SUBORDINATION OF SECURITIES........................ 61
SECTION 15.01. Agreement to Subordinate........................... 61
SECTION 15.02. Default on Senior and Subordinated Indebtedness.... 61
SECTION 15.03. Liquidation; Dissolution; Bankruptcy............... 62
SECTION 15.04. Subrogation........................................ 63
SECTION 15.05. Trustee to Effectuate Subordination................ 64
SECTION 15.06. Notice by the Company.............................. 65
SECTION 15.07. Rights of the Trustee; Holders of Senior
and Subordinated Indebtedness...................... 66
SECTION 15.08. Subordination May Not Be Impaired.................. 66
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD.................. 67
SECTION 16.01. Extension of Interest Payment Period............... 67
SECTION 16.02. Notice of Extension................................ 68
EXHIBIT A..................................................................A-1
Testimonium
Signatures
Acknowledgements
vi
<PAGE>
THIS INDENTURE, dated as of May __, 1997, between Independent Bank Corp., a
Massachusetts corporation (hereinafter sometimes called the "Company"), and The
Bank of New York, a New York banking corporation, as trustee (hereinafter
sometimes called the "Trustee"),
W I T N E S S E T H :
In consideration of the premises, and the purchase of the Securities by the
holders thereof, the Company covenants and agrees with the Trustee for the equal
and proportionate benefit of the respective holders from time to time of the
Securities, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Indenture shall have the respective meanings specified in this Section
1.01. All other terms used in this Indenture which are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), or which are by
reference therein defined in the Securities Act, shall (except as herein
otherwise expressly provided or unless the context otherwise requires) have the
meanings assigned to such terms in said Trust Indenture Act and in said
Securities Act as in force at the date of this Indenture as originally executed.
The following terms have the meanings given to them in the Declaration: (i)
Clearing Agency; (ii) Delaware Trustee; (iii) Property Trustee; (iv)
Administrative Trustees; (v) Direct Action; and (vi) Distributions. All
accounting terms used herein and not expressly defined shall have the meanings
assigned to such terms in accordance with generally accepted accounting
principles and the term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of any computation.
The words "herein", "hereof" and "hereunder" and other words of similar import
refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision. Headings are used for convenience of reference only and do
not affect interpretation. The singular includes the plural and vice versa.
"Additional Sums" shall have the meaning set forth in Section 2.05(c).
"Affiliate" shall have the meaning given to that term in Rule 405 under the
Securities Act or any successor rule thereunder.
"Allocable Amounts" when used with respect to any Senior and Subordinated
Indebtedness, means all amounts due or to become due on such Senior and
Subordinated
<PAGE>
Indebtedness less, if applicable, any amount which would have been paid to, and
retained by, the holders of such Senior and Subordinated Indebtedness (whether
as a result of the receipt of payments by the holders of such Senior and
Subordinated Indebtedness from the Company or any other obligor thereon or from
any holders of, or trustee in respect of, other indebtedness that is subordinate
and junior in right of payment to such Senior and Subordinated Indebtedness
pursuant to any provision of such indebtedness for the payment over of amounts
received on account of such indebtedness to the holders of such Senior and
Subordinated Indebtedness or otherwise) but for the fact that such Senior and
Subordinated Indebtedness is subordinated or junior in right of payment to (or
subject to a requirement that amounts received on such Senior and Subordinated
Indebtedness be paid over to obligees on) trade accounts payable or accrued
liabilities arising in the ordinary course of business.
"Authenticating Agent" shall mean any agent or agents of the Trustee which
at the time shall be appointed and acting pursuant to Section 6.14.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar federal or
state law for the relief of debtors.
"Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
"Board Resolution" shall mean a copy of a resolution certified by the Clerk
or an Assistant Clerk of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" shall mean, with respect to any series of Securities, any
day other than a Saturday or a Sunday or a day on which banking institutions in
The City of New York or Rockland, Massachusetts are authorized or required by
law or executive order to close.
"Commission" shall mean the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Securities" shall mean undivided beneficial interests in the assets
of Independent Capital Trust which rank pari passu with Preferred Securities
issued by Independent Capital Trust; provided, however, that if an Event of
Default has occurred and is continuing, no payments in respect of Distributions
on, or payments upon liquidation, redemption or otherwise with respect to, the
Common Securities shall be made until the
2
<PAGE>
holders of the Preferred Securities shall be paid in full the Distributions and
the liquidation, redemption and other payments to which they are entitled.
"Common Securities Guarantee" shall mean any guarantee that the Company may
enter into with any Person or Persons that operates directly or indirectly for
the benefit of holders of Common Securities of Independent Capital Trust.
"Common Stock" shall mean the Common Stock, par value $.01 per share, of
the Company or any other class of stock resulting from changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
"Company" shall mean Independent Bank Corp., a Massachusetts corporation,
and, subject to the provisions of Article X, shall include its successors and
assigns.
"Company Request" or "Company Order" shall mean a written request or order
signed in the name of the Company by the Chairman, the Chief Executive Officer,
the President, a Vice Chairman, a Vice President, the Comptroller, the Clerk or
an Assistant Clerk of the Company, and delivered to the Trustee.
"Compounded Interest" shall have the meaning set forth in Section 16.01.
"Custodian" shall mean any receiver, trustee, assignee, liquidator, or
similar official under any Bankruptcy Law.
"Declaration" means the Amended and Restated Declaration of Trust of
Independent Capital Trust, dated as of May __, 1997, as amended from time to
time.
"Default" means any event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"Defaulted Interest" shall have the same meaning set forth in Section 2.10.
"Deferred Interest" shall have the meaning set forth in Section 16.01.
"Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.
"Depositary" shall mean, with respect to Securities, for which the Company
shall determine that such Securities will be issued as a Global Security, The
Depository Trust Company, New York, New York, another clearing agency, or any
successor registered as a clearing agency under the Exchange Act or other
applicable statute or regulation, which, in each case, shall be designated by
the Company pursuant to Section 2.04(d).
3
<PAGE>
"Dissolution Event" means the liquidation of Independent Capital Trust
pursuant to the Declaration, and the distribution of the Securities held by the
Property Trustee to the holders of the Trust Securities issued by Independent
Capital Trust pro rata in accordance with the Declaration.
"Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice, if
any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Extended Interest Payment Period" shall have the meaning set forth in
Section 16.01.
"Federal Reserve" shall mean the Board of Governors of the Federal Reserve
System.
"Global Security" means, with respect to the Securities, a Security
executed by the Company and delivered by the Trustee to the Depositary or
pursuant to the Depositary's instruction, all in accordance with the Indenture,
which shall be registered in the name of the Depositary or its nominee.
"Indebtedness" shall mean with respect to any Person, whether recourse is
to all or a portion of the assets of such Person and whether or not contingent,
(i) every obligation of such Person for money borrowed; (ii) every obligation of
such Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of derivative products,
including interest rate, foreign exchange rate and commodity forward contracts,
options and swaps and similar arrangements; and (vii) every obligation of the
type referred to in clauses (i) through (vi) of another Person and all dividends
of another Person the payment of which, in either case, such Person has
guaranteed or is responsible or liable, directly or indirectly, as obligor or
otherwise.
"Indenture" shall mean this instrument as originally executed or, if
amended as herein provided, as so amended.
"Independent Capital Trust" or the "Trust" shall mean Independent Capital
Trust I, a Delaware business trust created for the purpose of issuing its
undivided beneficial interests in connection with the issuance of Securities
under this Indenture.
4
<PAGE>
"Interest Payment Date" shall have the meaning set forth in Section
2.05(a).
"Investment Company Event" means the receipt by Independent Capital Trust
and the Company of an Opinion of Counsel, rendered by a law firm experienced in
such matters, to the effect that, as a result of change in law or regulation or
a change in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority,
Independent Capital Trust is or will be considered an "investment company" that
is required to be registered under the 1940 Act, which change becomes effective
on or after the date of original issuance of the Preferred Securities of
Independent Capital Trust.
"Maturity Date" shall mean _______, 2027, or such shorter period if the
Company receives prior approval from the Federal Reserve, if then required under
applicable capital guidelines or policies of the Federal Reserve.
"Mortgage" shall mean and include any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other similar
encumbrance.
"Non Book-Entry Preferred Securities" shall have the meaning set forth in
Section 2.04(a)(ii).
"Officers" shall mean any of the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice President, the Comptroller, the Clerk
or an Assistant Clerk of the Company.
"Officers' Certificate" shall mean a certificate signed by two Officers and
delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of counsel, who may be an
employee of the Company, and who shall be acceptable to the Trustee.
"Other Debentures" means all junior subordinated debentures issued by the
Company from time to time and sold to trusts to be established by the Company
(if any), in each case similar to the Trust.
"Other Guarantees" means all guarantees to be issued by the Company with
respect to preferred securities (if any) and issued to other trusts to be
established by the Company (if any), in each case similar to the Trust.
The term "outstanding" when used with reference to Securities, shall,
subject to the provisions of Section 7.04, mean, as of any particular time, all
Securities authenticated and delivered by the Trustee or the Authenticating
Agent under this Indenture, except
5
<PAGE>
(a) Securities theretofore cancelled by the Trustee or the Authenticating
Agent or delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption of
which moneys in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside and segregated in trust by the
Company (if the Company shall act as its own paying agent); provided
that, if such Securities, or portions thereof, are to be redeemed
prior to maturity thereof, notice of such redemption shall have been
given as in Article XIV provided or provision satisfactory to the
Trustee shall have been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other Securities
shall have been authenticated and delivered pursuant to the terms of
Section 2.08 unless proof satisfactory to the Company and the Trustee
is presented that any such Securities are held by bona fide holders in
due course;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned shall
be so disregarded. Securities so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor. Upon the written request of the
Trustee, the Company shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known by the Company
to be owned or held by or for the account of the Company, or any other obligor
on the Securities or any Affiliate of the Company or such obligor, and, subject
to the provisions of Section 6.0, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth and
of the fact that all Securities not listed therein are Outstanding for the
purpose of any such determination.
"Person" shall mean any individual, corporation, estate, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt and as that evidenced by
such particular
6
<PAGE>
Security; and, for the purposes of this definition, any Security authenticated
and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Security
shall be deemed to evidence the same debt as the lost, destroyed or stolen
Security.
"Preferred Securities" shall mean undivided beneficial interests in the
assets of Independent Capital Trust which rank pari passu with the Common
Securities issued by Independent Capital Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, redemption or otherwise with
respect to, the Common Securities shall be made until the holders of the
Preferred Securities shall be paid in full the Distributions and the
liquidation, redemption and other payments to which they are entitled.
"Preferred Securities Guarantee" shall mean any guarantee that the Company
may enter into with The Bank of New York or other Persons that operates directly
or indirectly for the benefit of holders of Preferred Securities.
"Principal Office of the Trustee", or other similar term, shall mean the
office of the Trustee, at which at any particular time its corporate trust
business shall be administered.
"Property Trustee" shall have the same meaning as set forth in the
Declaration.
"Redemption Date" when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
A "Regulatory Capital Event" means that the Company shall have received an
opinion of independent bank regulatory counsel experienced in such matters to
the effect that, as a result of (a) any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any rules, guidelines or policies of the Federal Reserve or
(b) any official administrative pronouncement or judicial decision interpreting
or applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after ________, 1997, the
Preferred Securities do not constitute, or within 90 days of the date thereof,
will not constitute, Tier I Capital (or its then equivalent); provided, however,
that the distribution of the Junior Subordinated Debentures in connection with a
termination of the Trust by the Company shall not in and of itself constitute a
Regulatory Capital Event.
"Responsible Officer" shall mean any officer of the Trustee with direct
responsibility for the administration of the Indenture and also means, with
respect to a
7
<PAGE>
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Securities" or "Security" mean, any debt securities or debt security, as
the case may be, authenticated and delivered under this Indenture.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Securityholder", "holder of Securities", or other similar terms, shall
mean any Person in whose name at the time a particular Security is registered on
the register kept by the Company or the Trustee for that purpose in accordance
with the terms hereof.
"Security Register" shall have the meaning specified in Section 2.06.
"Senior and Subordinated Indebtedness" means the principal of (and premium,
if any) and interest, if any (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company
whether or not such claim for post-petition interest is allowed in such
proceeding), on Indebtedness of the Company, whether incurred on or prior to the
date of this Indenture or thereafter incurred, unless, in the instrument
creating or evidencing the same or pursuant to which the same is outstanding it
is provided that such obligations are not superior in right of payment to the
Securities or other Indebtedness which is pari passu with, or subordinated to,
the Securities, provided, however, that Senior and Subordinated Indebtedness
shall not be deemed to include (a) any Indebtedness of the Company which, when
incurred and without respect to any election under Section 1111(b) of the
Bankruptcy Reform Act of 1978, as amended, was without recourse to the Company,
(b) any Indebtedness of the Company to any of its Subsidiaries, (c) Indebtedness
to any employee of the Company, and (d) any Securities.
"Special Event" means either an Investment Company Event, a Regulatory
Capital Event or a Tax Event.
"Subsidiary" shall mean with respect to any Person, (i) any corporation at
least a majority of the outstanding voting stock of which is owned, directly or
indirectly, by such Person or by one or more of its Subsidiaries, or by such
Person and one or more of its Subsidiaries, (ii) any general partnership, joint
venture or similar entity, at least a majority of whose outstanding partnership
or similar interests shall at the time be owned by such Person, or by one or
more of its Subsidiaries, or by such Person and one or more of its Subsidiaries
and (iii) any limited partnership of which such Person or any of its
Subsidiaries is a general partner. For the purposes of this definition, "voting
stock" means shares, interests, participations or other equivalents in the
equity interest (however designated) in such Person having ordinary voting power
for the election of a majority of the directors (or the equivalent) of such
Person, other than shares, interests, participations or other equivalents having
such power only by reason of the occurrence of a contingency.
8
<PAGE>
"Tax Event" shall mean the receipt by Independent Capital Trust and the
Company of an opinion of counsel experienced in such matters to the effect that,
as a result of any amendment to, or change (including any announced prospective
change) in, the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein or as a result of
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after May __, 1997, there is
more than an insubstantial risk that (i) Independent Capital Trust is, or will
be within 90 days of the date of such opinion, subject to United States Federal
income tax with respect to income received or accrued on the Securities, (ii)
interest payable by the Company on the Securities is not, or within 90 days of
the date of such opinion, will not be, deductible by the Company, in whole or in
part, for United States Federal income tax purposes or (iii) Independent Capital
Trust is, or will be within 90 days of the date of such opinion, subject to more
than a de minimis amount of other taxes, duties or other governmental charges.
"Trust Indenture Act of 1939" shall mean the Trust Indenture Act of 1939 as
in force at the date of execution of this Indenture; provided, however, that, in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act of 1939" shall mean, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.
"Trustee" shall mean the Person identified as "Trustee" in the first
paragraph hereof, and, subject to the provisions of Article VI hereof, shall
also include its successors and assigns as Trustee hereunder. The term "Trustee"
as used with respect to a particular series of the Securities shall mean the
trustee with respect to that series.
"Trust Securities" shall mean the Preferred Securities and the Common
Securities, collectively.
"Underwriting Agreement" shall mean the Underwriting Agreement dated May
__, 1997 among the Company, Independent Capital Trust and the underwriters named
therein.
"U.S. Government Obligations" shall mean securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case under
clauses (i) or (ii) are not callable or redeemable at the option of the issuer
thereof, and shall also include a depository receipt issued by a bank or trust
company as custodian with respect to any such U.S. Government Obligation or a
specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law)
9
<PAGE>
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Government Obligation evidenced by such
depository receipt.
ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally.
The Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A, the terms of which are incorporated in
and made a part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which the
Company is subject or usage. Each Security shall be dated the date of its
authentication. The Securities shall be issued in denominations of $25 and
integral multiples thereof.
SECTION 2.02. Execution and Authentication.
The Securities shall be executed on behalf of the Company by a duly
authorized officer and attested by a Clerk or an Assistant Clerk. The signature
of any such person on the Securities may be manual or facsimile. If an Officer
whose signature is on a Security no longer holds that office at the time the
Security is authenticated, the Security shall nevertheless be valid.
A Security shall not be valid until authenticated by the manual signature
of the Trustee. The signature of the Trustee shall be conclusive evidence that
the Security has been authenticated under this Indenture. The form of Trustee's
certificate of authentication to be borne by the Securities shall be
substantially as set forth in Exhibit A hereto.
The Trustee shall, upon a Company Order, authenticate for original issue up
to, and the aggregate principal amount of Securities outstanding at any time may
not exceed $25,774,000 aggregate principal amount of the Securities, which may
be increased to an aggregate principal amount of Securities outstanding of
$29,640,100 if an overallotment option granted to the underwriters pursuant to
the Underwriting Agreement is exercised in full, except as provided in Sections
2.06, 2.07, 2.08 and 14.05.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.04, the Securities shall be issued in fully
registered certificated form without interest coupons. Principal of and interest
on the Securities issued in certificated form will be payable, the transfer of
such Securities will be registrable and such Securities will be exchangeable for
Securities bearing identical terms and provi-
10
<PAGE>
sions at the office or agency of the Company maintained for such purpose under
Section 3.02; provided, however, that payment of interest with respect to
Securities (other than a Global Security) may be made at the option of the
Company (i) by check mailed to the holder at such address as shall appear in the
Security Register or (ii) by transfer to an account maintained by the Person
entitled thereto, provided that proper transfer instructions have been received
in writing by the relevant record date.
SECTION 2.04. Global Security.
(a) In connection with a Dissolution Event,
(i) if any Preferred Securities are held in book-entry form, the
related Definitive Securities shall be presented to the Trustee (if an
arrangement with the Depositary has been maintained) by the Property
Trustee in exchange for one or more Global Securities (as may be required
pursuant to Section 2.06) in an aggregate principal amount equal to the
aggregate principal amount of all outstanding Securities, to be registered
in the name of the Depositary, or its nominee, and delivered by the Trustee
to the Depositary for crediting to the accounts of its participants
pursuant to the instructions of the Administrative Trustees; the Company
upon any such presentation shall execute one or more Global Securities in
such aggregate principal amount and deliver the same to the Trustee for
authentication and delivery in accordance with this Indenture; and payments
on the Securities issued as a Global Security will be made to the
Depositary; and
(ii) if any Preferred Securities are held in certificated form, the
related Definitive Securities may be presented to the Trustee by the
Property Trustee and any Preferred Security certificate which represents
Preferred Securities other than Preferred Securities in book-entry form
("Non Book-Entry Preferred Securities") will be deemed to represent
beneficial interests in Securities presented to the Trustee by the Property
Trustee having an aggregate principal amount equal to the aggregate
liquidation amount of the Non Book-Entry Preferred Securities until such
Preferred Security certificates are presented to the Security Registrar for
transfer or reissuance, at which time such Preferred Security certificates
will be cancelled and a Security, registered in the name of the holder of
the Preferred Security certificate or the transferee of the holder of such
Preferred Security certificate, as the case may be, with an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Security certificate cancelled, will be executed by the Company and
delivered to the Trustee for authentication and delivery in accordance with
this Indenture. Upon the issuance of such Securities, Securities with an
equivalent aggregate principal amount that were presented by the Property
Trustee to the Trustee will be cancelled.
(b) The Global Securities shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon; provided, that the
aggregate amount of
11
<PAGE>
outstanding Securities represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions. Any endorsement
of a Global Security to reflect the amount of any increase or decrease in the
amount of outstanding Securities represented thereby shall be made by the
Trustee, in accordance with instructions given by the Company as required by
this Section 2.04.
(c) The Global Securities may be transferred, in whole but not in part,
only to the Depositary, another nominee of the Depositary, or to a successor
Depositary selected or approved by the Company or to a nominee of such successor
Depositary.
(d) If at any time the Depositary notifies the Company that it is unwilling
or unable to continue as Depositary or the Depositary has ceased to be a
clearing agency registered under the Exchange Act, and a successor Depositary is
not appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such condition, as the case may be, the Company will
execute, and the Trustee, upon receipt of a Company Order, will authenticate and
make available for delivery the Definitive Securities, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Security in exchange for such Global Security. If there is
an Event of Default, the Depositary shall have the right to exchange the Global
Securities for Definitive Securities. In addition, the Company may at any time
determine that the Securities shall no longer be represented by a Global
Security. In the event of such an Event of Default or such a determination, the
Company shall execute, and subject to Section 2.06, the Trustee, upon receipt of
an Officers' Certificate evidencing such determination by the Company and a
Company Order, will authenticate and make available for delivery the Definitive
Securities, in authorized denominations, and in an aggregate principal amount
equal to the principal amount of the Global Security in exchange for such Global
Security. Upon the exchange of the Global Security for such Definitive
Securities, in authorized denominations, the Global Security shall be cancelled
by the Trustee. Such Definitive Securities issued in exchange for the Global
Security shall be registered in such names and in such authorized denominations
as the Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall deliver
such Definitive Securities to the Depositary for delivery to the Persons in
whose names such Definitive Securities are so registered.
SECTION 2.05 Interest.
(a) Each Security will bear interest at the rate of _____% per annum (the
"Coupon Rate") from the most recent date to which interest has been paid or duly
provided for or, if no interest has been paid or duly provided for, from May __,
1997, until the principal thereof becomes due and payable, and at the Coupon
Rate on any overdue principal and (to the extent that payment of such interest
is enforceable under applicable law) on any overdue installment of interest,
compounded quarterly payable (subject to the provisions of Article XVI)
quarterly in arrears on the ____ day of March, June, September and December of
each year (each, an "Interest Payment Date") commencing on _________, 1997, to
the
12
<PAGE>
Person in whose name such Security or any predecessor Security is registered,
at the close of business on the regular record date for such interest
installment, which shall be the Business Day next preceding such Interest
Payment Date; provided, however, that in the event that the Preferred
Securities are no longer in book-entry only form or this Security (or one or
more Predecessor Securities) are not represented by a Global Security, the
record date for such payment shall be the [first day of the month/fifteenth day
of the month immediately preceding the month] in which such payment is due.
(b) Interest will be computed on the basis of a 360-day year consisting
of twelve 30-day months and, for any period of less than a full calendar
month, the number of days lapsed in such month based upon a 30-day month. In
the event that any Interest Payment Date falls on a day that is not a
Business Day, then payment of interest payable on such date will be made on
the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that if such next
succeeding Business Day falls in the next succeeding calendar year, then such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date.
(c) During such time as the Property Trustee is the holder of any
Securities, the Company shall pay any additional amounts on the Securities as
may be necessary in order that the amount of Distributions then due and
payable by Independent Capital Trust on the outstanding Trust Securities
shall not be reduced as a result of any additional taxes, duties and other
governmental charges to which Independent Capital Trust has become subject as
a result of a Tax Event ("Additional Sums"). Whenever in this Indenture or
the Securities there is a reference in any context to the payment of
principal of or interest on the Securities, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this
paragraph and express mention of the payment of Additional Sums (if
applicable) in any provisions hereof shall not be construed as excluding
Additional Sums in those provisions hereof where such express mention is not
made; provided, however, that the deferral of the payment of interest
pursuant to Section 16.01 or the Securities shall not defer the payment of
any Additional Sums that may be due and payable.
SECTION 2.06. Transfer and Exchange.
The Company shall cause to be kept at the corporate trust office of the
Trustee a register in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Securities and
of transfers of Securities. Such register is herein sometimes referred to as
the "Securities Register."
To permit registrations of transfers, the Company shall execute and the
Trustee shall authenticate Definitive Securities and Global Securities at the
Security Registrar's request. All Definitive Securities and Global Securities
issued upon any registration of transfer or exchange of Definitive Securities
or Global Securities shall be the valid
13
<PAGE>
obligations of the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Definitive Securities or Global Securities
surrendered upon such registration of transfer or exchange.
Upon surrender for registration of transfer of any Security at the office
or agency of the Company designated for that purpose the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of the same series of any
authorized denominations, of a like aggregate principal amount, of the same
original issue date and Stated Maturity Date and having the same terms.
At the option of the holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of a like
aggregate principal amount, of the same original issue date and Stated Maturity
Date and having the same terms, upon surrender of the Securities to be exchanged
at such office or agency. Whenever any securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the holder making the exchange is entitled to
receive.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith.
The Company shall not be required to (i) issue, register the transfer of or
exchange Securities during a period beginning at the opening of business 15 days
before the day of mailing of a notice of redemption or any notice of selection
of Securities for redemption under Article XIV hereof and ending at the close of
business on the day of such mailing; or (ii) register the transfer of or
exchange any Security so selected for redemption in whole or in part, except the
unredeemed portion of any Security being redeemed in part.
Prior to due presentment for the registration of a transfer of any
Security, the Trustee, the Company and any agent of the Trustee or the Company
may deem and treat the Person in whose name any Security is registered as the
absolute owner of such Security for the purpose of receiving payment of
principal of and interest on such Securities, neither the Trustee, nor the
Company nor any agent of the Trustee or the Company shall be affected by notice
to the contrary.
SECTION 2.07. Replacement Securities.
If any mutilated Security is surrendered to the Trustee, or the Company and
the Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Security, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements for
replacements of Securities are met. An indemnity bond must be supplied by the
holder that is sufficient in the judgment of the Trustee and the
14
<PAGE>
Company to protect the Company, the Trustee, any agent thereof or any
authenticating agent from any loss that any of them may suffer if a Security is
replaced. The Company or the Trustee may charge for its expenses in replacing a
Security.
Every replacement Security is an obligation of the Company and shall be
entitled to all of the benefits of this Indenture equally and proportionately
with all other Securities duly issued hereunder.
SECTION 2.08. Temporary Securities.
Pending the preparation of Definitive Securities, the Company may execute,
and upon Company Order the Trustee shall authenticate and make available for
delivery, temporary Securities that are printed, lithographed, typewritten,
mimeographed or otherwise reproduced, in any authorized denomination,
substantially of the tenor of the Definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
conclusively evidenced by their execution of such Securities.
If temporary Securities are issued, the Company shall cause Definitive
Securities to be prepared without unreasonable delay. The Definitive Securities
shall be printed, lithographed or engraved, or provided by any combination
thereof, or in any other manner permitted by the rules and regulations of any
applicable securities exchange, all as determined by the officers executing such
Definitive Securities. After the preparation of Definitive Securities, the
temporary Securities shall be exchangeable for Definitive Securities upon
surrender of the temporary Securities at the office or agency maintained by the
Company for such purpose pursuant to Section 3.02 hereof, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Securities,
the Company shall execute, and the Trustee shall authenticate and make available
for delivery, in exchange therefor the same aggregate principal amount of
Definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as Definitive Securities.
SECTION 2.09. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Trustee and no one else shall cancel all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall retain or dispose of cancelled Securities in accordance
with its normal practices (subject to the record retention requirement of the
Exchange Act) unless the Company directs them to be returned to it. The Company
may not issue new Securities to replace Securities that have been redeemed or
paid or that have been delivered to the Trustee for cancellation.
15
<PAGE>
SECTION 2.10. Defaulted Interest.
Any interest on any Security that is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the holder on the relevant
regular record date by virtue of having been such holder; and such Defaulted
Interest shall be paid by the Company, at its election, as provided in clause
(a) or clause (b) below:
(a) The Company may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their
respective Predecessor Securities) are registered at the close of business
on a special record date for the payment of such Defaulted Interest, which
shall be fixed in the following manner: the Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each such Security and the date of the proposed payment, and at the same
time the Company shall deposit with the Trustee an amount of money equal to
the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this clause provided. Thereupon the Trustee
shall fix a special record date for the payment of such Defaulted Interest
which shall not be more than 15 nor less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such special record date and, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the special record date therefor to be mailed, first
class postage prepaid, to each Securityholder at his or her address as it
appears in the Security Register, not less than 10 days prior to such
special record date. Notice of the proposed payment of such Defaulted
Interest and the special record date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names such Securities (or their respective Predecessor Securities) are
registered on such special record date and shall be no longer payable
pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on any
Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this clause, such manner of payment shall be deemed practicable by the
Trustee.
16
<PAGE>
SECTION 2.11. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Securityholders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the CUSIP numbers.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal and Interest.
The Company covenants and agrees for the benefit of the holders of the
Securities that it will duly and punctually pay or cause to be paid the
principal of and interest on the Securities at the place, at the respective
times and in the manner provided herein. Except as provided in Section 2.03,
each installment of interest on the Securities may be paid by mailing checks for
such interest payable to the order of the holder of Security entitled thereto as
they appear in the Security Register. The Company further covenants to pay any
and all amounts, including, without limitation, Additional Sums, as may be
required pursuant to Section 2.05(c), and Compounded Interest, as may be
required pursuant to Section 16.01.
SECTION 3.02. Offices for Notices and Payments, etc.
So long as any of the Securities remain outstanding, the Company will
maintain in the Borough of Manhattan, The City of New York, an office or agency
where the Securities may be presented for payment, an office or agency where the
Securities may be presented for registration of transfer and for exchange as in
this Indenture provided and an office or agency where notices and demands to or
upon the Company in respect of the Securities or of this Indenture may be
served. The Company will give to the Trustee written notice of the location of
any such office or agency and of any change of location thereof. Until otherwise
designated from time to time by the Company in a notice to the Trustee, any such
office or agency for all of the above purposes shall be the Principal Office of
the Trustee. In case the Company shall fail to maintain any such office or
agency in the Borough of Manhattan, The City of New York, or shall fail to give
such notice of the location or of any change in the location thereof,
presentations and demands may be made and notices may be served at the Principal
Office of the Trustee.
17
<PAGE>
In addition to any such office or agency, the Company may from time to time
designate one or more offices or agencies outside the Borough of Manhattan, The
City of New York, where the Securities may be presented for payment,
registration of transfer and for exchange in the manner provided in this
Indenture, and the Company may from time to time rescind such designation, as
the Company may deem desirable or expedient; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain any such office or agency in the Borough of Manhattan,
The City of New York, for the purposes above mentioned. The Company will give to
the Trustee prompt written notice of any such designation or rescission thereof.
SECTION 3.03. Appointments to Fill Vacancies in Trustee's Office.
The Company, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 6.10, a Trustee, so
that there shall at all times be a Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent.
(a) If the Company shall appoint a paying agent other than the Trustee
with respect to the Securities, it will cause such paying agent to
execute and deliver to the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provision of this Section
3.04,
(1) that it will hold all sums held by it as such agent for the
payment of the principal of or interest on the Securities
(whether such sums have been paid to it by the Company or by any
other obligor on the Securities) in trust for the benefit of the
holders of the Securities; and
(2) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities) to make any
payment of the principal of or interest (including Additional
Sums and Compounded Interest, if any) on the Securities when the
same shall be due and payable.
(b) If the Company shall act as its own paying agent, it will, on or
before each due date of the principal of or interest on the
Securities, set aside, segregate and hold in trust for the benefit of
the holders of the Securities a sum sufficient to pay such principal
or interest so becoming due and will notify the Trustee of any failure
to take such action and of any failure by the Company (or by any other
obligor under the Securities) to make any payment of the principal of
or interest on the Securities when the same shall become due and
payable.
18
<PAGE>
(c) Anything in this Section 3.04 to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction
and discharge with respect to the Securities hereunder, or for any
other reason, pay or cause to be paid to the Trustee all sums held in
trust for such Securities by the Trustee or any paying agent
hereunder, as required by this Section 3.04, such sums to be held by
the Trustee upon the trusts herein contained.
(d) Anything in this Section 3.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 3.04 is
subject to Sections 11.03 and 11.04.
SECTION 3.05. Certificate to Trustee.
The Company will deliver to the Trustee on or before 120 days after the end
of each fiscal year in each year, commencing with the first fiscal year ending
after the date hereof, so long as Securities are outstanding hereunder, an
Officers' Certificate, one of the signers of which shall be the principal
executive, principal financial or principal accounting officer of the Company,
stating that in the course of the performance by the signers of their duties as
officers of the Company they would normally have knowledge of any default by the
Company in the performance of any covenants contained herein, stating whether or
not they have knowledge of any such default and, if so, specifying each such
default of which the signers have knowledge and the nature thereof.
SECTION 3.06. Compliance with Consolidation Provisions.
The Company will not, while any of the Securities remain outstanding,
consolidate with, or merge into, or merge into itself, or sell or convey all or
substantially all of its property to any other Person unless the provisions of
Article X hereof are complied with.
SECTION 3.07. Limitation on Dividends.
The Company will not (i) declare or pay any dividends or distributions on,
or redeem, purchase, acquire, or make a liquidation payment with respect to, any
of the Company's capital stock (which includes common and preferred stock), (ii)
make any payment of principal, premium, if any, or interest on or repay or
repurchase or redeem any debt securities of the Company (including Other
Debentures) that rank pari passu with or junior in right of payment to the
Securities or (iii) make any guarantee payments with respect to any guarantee by
the Company of the debt securities of any Subsidiary of the Company (including
Other Guarantees) if such guarantee ranks pari passu or junior in right of
payment to the Securities (other than (a) dividends or distributions in shares
of, or options, warrants or rights to subscribe for or purchase shares of,
Common Stock of the Company, (b) any declaration of a dividend in connection
with the implementation of a
19
<PAGE>
stockholder's rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Preferred Securities Guarantee, (d) the purchase of
fractional shares resulting from a reclassification of the Company's capital
stock, (e) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged and (f) purchases of Common
Stock related to the issuance of Common Stock or rights under any of the
Company's benefit plans for its directors, officers or employees or any of the
Company's dividend reinvestment plans) if at such time (1) there shall have
occurred any event of which the Company has actual knowledge that (a) is or,
with the giving of notice or the lapse of time, or both, would constitute an
Event of Default and (b) in respect of which the Company shall not have taken
reasonable steps to cure, (2) if such Securities are held by the Property
Trustee, the Company shall be in default with respect to its payment obligations
under the Preferred Securities Guarantee or (3) the Company shall have given
notice of its election of the exercise of its right to extend the interest
payment period pursuant to Section 16.01 and any such extension shall be
continuing.
SECTION 3.08. Covenants as to Independent Capital Trust
In the event Securities are issued to Independent Capital Trust or a
trustee of such trust in connection with the issuance of Trust Securities by
Independent Capital Trust, for so long as such Trust Securities remain
outstanding, the Company (i) will maintain 100% direct or indirect ownership of
the Common Securities of Independent Capital Trust; provided, however, that any
successor of the Company, permitted pursuant to Article X, may succeed to the
Company's ownership of such Common Securities, (ii) will use its reasonable
efforts to cause Independent Capital Trust (a) to remain a business trust,
except in connection with a distribution of Securities to the holders of Trust
Securities in liquidation of the Trust, the redemption of all of the Trust
Securities of Independent Capital Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of Independent Capital
Trust, and (b) to otherwise continue to be treated as a grantor trust and not an
association taxable as a corporation for United States federal income tax
purposes and (iii) use its reasonable efforts to cause each holder of Trust
Securities to be treated as owning an undivided beneficial interest in the
Securities.
SECTION 3.09. Payment of Expenses.
In connection with the offering, sale and issuance of the Securities to
Independent Capital Trust and in connection with the sale of the Trust
Securities by Independent Capital Trust, the Company, in its capacity as
borrower with respect to the Securities, shall:
(a) pay all costs and expenses relating to the offering, sale and issuance
of the Securities, including commissions to the underwriters payable pursuant to
the
20
<PAGE>
Underwriting Agreement and compensation of the Trustee in accordance with the
provisions of Section 6.06;
(b) pay all costs and expenses of the Trust (including, but not limited to,
costs and expenses relating to the organization of Independent Capital Trust,
the offering, sale and issuance of the Trust Securities (including commissions
to the underwriters in connection therewith), the fees and expenses of the
Property Trustee and the Delaware Trustee, the costs and expenses relating to
the operation of Independent Capital Trust, including without limitation, costs
and expenses of accountants, attorneys, statistical or bookkeeping services,
expenses for printing and engraving and computing or accounting equipment,
paying agent(s), registrar(s), transfer agent(s), duplicating, travel and
telephone and other telecommunications expenses and costs and expenses incurred
in connection with the acquisition, financing, and disposition of assets of
Independent Capital Trust;
(c) be primarily and fully liable for any indemnification obligations
arising with respect to the Declaration;
(d) pay any and all taxes (other than United States withholding taxes
attributable to Independent Capital Trust or its assets) and all liabilities,
costs and expenses with respect to such taxes of the Trust; and
(e) pay all other fees, expenses, debts and obligations (other than in
respect of principal and interest on the Trust Securities) related to
Independent Capital Trust.
SECTION 3.10. Payment Upon Resignation or Removal.
Upon termination of this Indenture or the removal or resignation of the
Trustee, unless otherwise stated, the Company shall pay to the Trustee all
amounts accrued and owing to the date of such termination, removal or
resignation. Upon termination of the Declaration or the removal or resignation
of the Delaware Trustee or the Property Trustee, as the case may be, pursuant to
Section 5.7 of the Declaration, the Company shall pay to the Delaware Trustee or
the Property Trustee, as the case may be, all amounts accrued and owing to the
date of such termination, removal or resignation.
21
<PAGE>
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 4.01. Securityholders' Lists.
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee:
(a) on a semi-annual basis on each regular record date for the Securities,
a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Securityholders as of such record date; and
(b) at such other times as the Trustee may request in writing, within 30
days after the receipt by the Company, of any such request, a list of
similar form and content as of a date not more than 15 days prior to
the time such list is furnished,
except that, no such lists need be furnished so long as the Trustee is in
possession thereof by reason of its acting as Security registrar.
SECTION 4.02. Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the
holders of the Securities (1) contained in the most recent list
furnished to it as provided in Section 4.01 or (2) received by it in
the capacity of Securities registrar (if so acting) hereunder. The
Trustee may destroy any list furnished to it as provided in Section
4.01 upon receipt of a new list so furnished.
(b) In case three or more holders of Securities (hereinafter referred to
as "applicants") apply in writing to the Trustee and furnish to the
Trustee reasonable proof that each such applicant has owned a Security
for a period of at least six months preceding the date of such
application, and such application states that the applicants desire to
communicate with other holders of Securities or with holders of all
Securities with respect to their rights under this Indenture and is
accompanied by a copy of the form of proxy or other communication
which such applicants propose to transmit, then the Trustee shall
within five Business Days after the receipt of such application, at
its election, either:
22
<PAGE>
(1) afford such applicants access to the information preserved at the
time by the Trustee in accordance with the provisions of
subsection (a) of this Section 4.02, or
(2) inform such applicants as to the approximate number of holders of
all Securities, whose names and addresses appear in the
information preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section 4.02, and
as to the approximate cost of mailing to such Securityholders the
form of proxy or other communication, if any, specified in such
application.
If the Trustee shall elect not to afford such applicants
access to such information, the Trustee shall, upon the written
request of such applicants, mail to each Securityholder whose
name and address appear in the information preserved at the time
by the Trustee in accordance with the provisions of subsection
(a) of this Section 4.02 a copy of the form of proxy or other
communication which is specified in such request with reasonable
promptness after a tender to the Trustee of the material to be
mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after
such tender, the Trustee shall mail to such applicants and file
with the Commission, together with a copy of the material to be
mailed, a written statement to the effect that, in the opinion of
the Trustee, such mailing would be contrary to the best interests
of the holders of Securities of such series or all Securities, as
the case may be, or would be in violation of applicable law. Such
written statement shall specify the basis of such opinion. If the
Commission, after opportunity for a hearing upon the objections
specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if, after the entry
of an order sustaining one or more of such objections, the
Commission shall find, after notice and opportunity for hearing,
that all the objections so sustained have been met and shall
enter an order so declaring, the Trustee shall mail copies of
such material to all such Securityholders with reasonable
promptness after the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of any obligation
or duty to such applicants respecting their application.
(c) Each and every holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company
nor the Trustee nor any paying agent shall be held accountable by
reason of the disclosure of any such information as to the names and
addresses of the holders of Securities in accordance with the
provisions of subsection (b) of this Section 4.02, regardless of the
23
<PAGE>
source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).
SECTION 4.03. Reports by Company.
(a) The Company covenants and agrees to file with the Trustee, within 15
days after the date on which the Company is required to file the same
with the Commission, copies of the annual reports and of the informa-
tion, documents and other reports (or copies of such portions of any
of the foregoing as said Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with
the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act; or, if the Company is not required to file information, documents
or reports pursuant to either of such sections, then to file with the
Trustee and the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which
may be required pursuant to Section 13 of the Exchange Act in respect
of a security listed and registered on a national securities exchange
as may be prescribed from time to time in such rules and regulations.
(b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed
from time to time by said Commission, such additional information,
documents and reports with respect to compliance by the Company with
the conditions and covenants provided for in this Indenture as may be
required from time to time by such rules and regulations.
(c) The Company covenants and agrees to transmit by mail to all holders of
Securities, as the names and addresses of such holders appear upon the
Security Register, within 30 days after the filing thereof with the
Trustee, such summaries of any information, documents and reports
required to be filed by the Company pursuant to subsections (a) and
(b) of this Section 4.03 as may be required by rules and regulations
prescribed from time to time by the Commission.
(d) Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to
24
<PAGE>
which the Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 4.04. Reports by the Trustee.
(a) The Trustee shall transmit to Securityholders such reports concerning
the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto. If required by Section 313(a) of the Trust
Indenture Act, the Trustee shall, within sixty days after each May 15
following the date of this Indenture, commencing May 15, 1998, deliver
to Securityholders a brief report, dated as of such May 15, which com-
plies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission to
Securityholders, be filed by the Trustee with each stock exchange, if
any, upon which the Securities are listed, with the Commission and
with the Company. The Company will promptly notify the Trustee when
the Securities are listed on any stock exchange.
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall constitute an Event of
Default hereunder:
(a) default in the payment of any interest (including Compounded Interest
or Additional Sums, if any) upon any Security or any Other Debentures
when it becomes due and payable, and continuance of such default for a
period of 30 days; provided, however, that a valid extension of an
interest payment period by the Company in accordance with the terms
hereof shall not constitute a default in the payment of interest for
this purpose; or
(b) default in the payment of all or any part of the principal of any
Security or any Other Debentures as and when the same shall become due
and payable either at maturity, upon redemption, by declaration of
acceleration of maturity or otherwise; or
25
<PAGE>
(c) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this
Section specifically dealt with), and continuance of such default or
breach for a period of 90 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the holders of at least 25% in aggregate
principal amount of the outstanding Securities a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(d) a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Company in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now
or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of
the Company or for any substantial part of its property, or ordering
the winding-up or liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a period of 90
consecutive days; or
(e) the Company shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in
effect, shall consent to the entry of an order for relief in an
involuntary case under any such law, or shall consent to the
appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or other similar official)
of the Company or of any substantial part of its property, or shall
make any general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due.
If an Event of Default with respect to Securities at the time outstanding
occurs and is continuing, then in every such case the Trustee or the holders of
not less than 25% in aggregate principal amount of the Securities then
outstanding may declare the principal amount of all Securities to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by the holders of the outstanding Securities), and upon any such
declaration the same shall become immediately due and payable.
The foregoing provisions, however, are subject to the condition that if, at
any time after the principal of the Securities shall have been so declared due
and payable, and before any judgment or decree for the payment of the moneys due
shall have been obtained or entered as hereinafter provided, (i) the Company
shall pay or shall deposit with the Trustee a sum sufficient to pay (A) all
matured installments of interest (including Compounded Interest and Additional
Sums, if any) upon all the Securities and the principal of any and all
Securities which shall have become due otherwise than by acceleration (with
26
<PAGE>
interest upon such principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest, at the
same rate as the rate of interest specified in the Securities to the date of
such payment or deposit) and (B) such amount as shall be sufficient to cover
compensation due to the Trustee and each predecessor Trustee, their respective
agents, attorneys and counsel, pursuant to Section 6.06, and (ii) any and all
Events of Default under the Indenture, other than the non-payment of the
principal of the Securities which shall have become due solely by such
declaration of acceleration, shall have been cured, waived or otherwise remedied
as provided herein, then, in every such case, the holders of a majority in
aggregate principal amount of the Securities then outstanding, by written notice
to the Company and to the Trustee, may rescind and annul such declaration and
its consequences, but no such waiver or rescission and annulment shall extend to
or shall affect any subsequent default or shall impair any right consequent
thereon.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such rescission or annulment or for any other reason or shall have been
determined adversely to the Trustee, then and in every such case the Company,
the Trustee and the holders of the Securities shall be restored respectively to
their several positions and rights hereunder, and all rights, remedies and
powers of the Company, the Trustee and the holders of the Securities shall
continue as though no such proceeding had been taken.
SECTION 5.02. Payment of Securities on Default; Suit Therefor.
The Company covenants that (a) in case default shall be made in the payment
of any installment of interest (including Compounded Interest and Additional
Sums, if any) upon any of the Securities as and when the same shall become due
and payable, and such default shall have continued for a period of 30 days, or
(b) in case default shall be made in the payment of the principal of on any of
the Securities as and when the same shall have become due and payable, whether
at maturity of the Securities or upon redemption or by declaration or otherwise,
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Securities, the whole amount that then shall have
become due and payable on all such Securities for principal or interest
(including Compounded Interest and Additional Sums, if any) or both, as the case
may be, with interest upon the overdue principal and (to the extent that payment
of such interest is enforceable under applicable law and, if the Securities are
held by Independent Capital Trust or a trustee of such trust, without
duplication of any other amounts paid by Independent Capital Trust or a trustee
in respect thereof) upon the overdue installments of interest (including
Compounded Interest and Additional Sums, if any) at the rate borne by the
Securities; and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including a reasonable
compensation to the Trustee, its agents, attorneys and counsel, and any other
amount due to the Trustee pursuant to Section 6.06.
27
<PAGE>
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the
Securities and collect in the manner provided by law out of the property of the
Company or any other obligor on the Securities wherever situated the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor on the Securities under Title
11, United States Code, or any other applicable law, or in case a receiver or
trustee shall have been appointed for the property of the Company or such other
obligor, or in the case of any other similar judicial proceedings relative to
the Company or other obligor upon the Securities, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 5.02,
shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of principal
and interest owing and unpaid in respect of the Securities and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for amounts due to the Trustee pursuant to 6.06) and of the
Securityholders allowed in such judicial proceedings relative to the Company or
any other obligor on the Securities, or to the creditors or property of the
Company or such other obligor, unless prohibited by applicable law and
regulations, to vote on behalf of the holders of the Securities in any election
of a trustee or a standby trustee in arrangement, reorganization, liquidation or
other bankruptcy or insolvency proceedings or person performing similar
functions in comparable proceedings, and to collect and receive any moneys or
other property payable or deliverable on any such claims, and to distribute the
same after the deduction of its charges and expenses; and any receiver, assignee
or trustee in bankruptcy or reorganization is hereby authorized by each of the
Securityholders to make such payments to the Trustee, and, in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee such amounts as shall be sufficient to
cover reasonable compensation to the Trustee, each predecessor Trustee and their
respective agents, attorneys and counsel, and all other amounts due to the
Trustee pursuant to Section 6.06.
Nothing herein contained shall be construed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any holder thereof or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
28
<PAGE>
All rights of action and of asserting claims under this Indenture, or under
any of the Securities, may be enforced by the Trustee without the possession of
any of the Securities, or the production thereof on any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall be for the ratable benefit of the holders of the
Securities.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Securities, and it shall not be necessary to make any holders of the
Securities parties to any such proceedings.
SECTION 5.03. Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the Securities in respect of which moneys have
been collected, and stamping thereon the payment, if only partially paid, and
upon surrender thereof if fully paid:
First: To the payment of costs and expenses of collection applicable to the
Securities and all other amounts due to the Trustee under Section 6.06;
Second: To the payment of all Senior and Subordinate Indebtedness of the
Company if and to the extent required by Article XV;
Third: In case the principal of the outstanding Securities in respect of
which moneys have been collected shall not have become due and be unpaid, to the
payment of the amounts then due and unpaid upon Securities for principal of and
interest (including Compounded Interest and Additional Sums, if any) on the
Securities, in respect of which or for the benefit of which money has been
collected, ratably, without preference of priority of any kind, according to the
amounts due on such Securities for principal and interest, respectively; and
Fourth: To the Company.
SECTION 5.04. Proceedings by Securityholders.
No holder of any Security shall have any right by virtue of or by availing
of any provision of this Indenture to institute any suit, action or proceeding
in equity or at law upon or under or with respect to this Indenture or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
such holder previously shall have given to the Trustee written notice of an
Event of Default and of the continuance thereof with respect to the Securities
specifying such Event of Default, as hereinbefore provided, and unless also the
holders of not less than 25% in aggregate principal amount of the Securities
29
<PAGE>
then outstanding shall have made written request upon the Trustee to institute
such action, suit or proceeding in its own name as Trustee hereunder and shall
have offered to the Trustee such reasonable indemnity as it may require against
the costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity shall have failed to institute any such action, suit or proceeding, it
being understood and intended, and being expressly covenanted by the taker and
holder of every Security with every other taker and holder and the Trustee, that
no one or more holders of Securities shall have any right in any manner whatever
by virtue of or by availing of any provision of this Indenture to affect,
disturb or prejudice the rights of any other holder of Securities, or to obtain
or seek to obtain priority over or preference to any other such holder, or to
enforce any right under this Indenture, except in the manner herein provided and
for the equal, ratable and common benefit of all holders of Securities.
Notwithstanding any other provisions in this Indenture, however, the right
of any holder of any Security to receive payment of the principal of and
interest (including Compounded Interest and Additional Sums, if any) on such
Security, on or after the same shall have become due and payable, or to
institute suit for the enforcement of any such payment, shall not be impaired or
affected without the consent of such holder and by accepting a Security
hereunder it is expressly understood, intended and covenanted by the taker and
holder of every Security with every other such taker and holder and the Trustee,
that no one or more holders of Securities shall have any right in any manner
whatsoever by virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of the holders of any other Securities,
or to obtain or seek to obtain priority over or preference to any other such
holder, or to enforce any right under this Indenture, except in the manner
herein provided and for the equal, ratable and common benefit of all holders of
Securities. For the protection and enforcement of the provisions of this
Section, each and every Securityholder and the Trustee shall be entitled to such
relief as can be given either at law or in equity.
The Company and the Trustee acknowledge that pursuant to the Declaration,
the holders of Preferred Securities are entitled, in the circumstances and
subject to the limitations set forth therein, to commence a Direct Action with
respect to any Event of Default under this Indenture and the Securities.
SECTION 5.05. Proceedings by Trustee.
In case an Event of Default occurs with respect to Securities and is
continuing, the Trustee may in its discretion proceed to protect and enforce the
rights vested in it by this Indenture by such appropriate judicial proceedings
as the Trustee shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
30
<PAGE>
SECTION 5.06. Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the Trustee or to the
Securityholders shall, to the extent permitted by law, be deemed cumulative and
not exclusive of any other powers and remedies available to the Trustee or the
holders of the Securities, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture or otherwise established with respect to the Securities, and no delay
or omission of the Trustee or of any holder of any of the Securities to exercise
any right or power accruing upon any Event of Default occurring and continuing
as aforesaid shall impair any such right or power, or shall be construed to be a
waiver of any such default or an acquiescence therein; and, subject to the
provisions of Section 5.04, every power and remedy given by this Article V or by
law to the Trustee or to the Securityholders may be exercised from time to time,
and as often as shall be deemed expedient, by the Trustee or by the
Securityholders.
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders.
The holders of a majority in aggregate principal amount of the Securities
at the time outstanding shall have the right to direct the time, method, and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee; provided, however, that
(subject to the provisions of Section 6.01) the Trustee shall have the right to
decline to follow any such direction if the Trustee shall determine that the
action so directed would be unjustly prejudicial to the holders not taking part
in such direction or if the Trustee being advised by counsel determines that the
action or proceeding so directed may not lawfully be taken or if the Trustee in
good faith by its board of directors or trustees, executive committee, or a
trust committee of directors or trustees and/or Responsible Officers shall
determine that the action or proceedings so directed would involve the Trustee
in personal liability. Prior to any declaration accelerating the maturity of the
Securities, the holders of a majority in aggregate principal amount of the
Securities at the time outstanding may on behalf of the holders of all of the
Securities waive any past default or Event of Default and its consequences
except a default (a) in the payment of principal of or interest (including
Compounded Interest and Additional Sums, if any) on any of the Securities or (b)
in respect of covenants or provisions hereof which cannot be modified or amended
without the consent of the holder of each Security affected; provided, however,
that if the Securities are held by the Property Trustee, such waiver or
modification to such waiver shall not be effective until the holders of a
majority in aggregate liquidation amount of Trust Securities shall have
consented to such waiver or modification to such waiver; provided further, that
if the consent of the holder of each outstanding Security is required, such
waiver shall not be effective until each holder of the Trust Securities shall
have consented to such waiver. Upon any such waiver, the default covered thereby
shall be deemed to be cured for all purposes of this Indenture and the Company,
the Trustee and the holders of the Securities shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to
any
31
<PAGE>
subsequent or other default or impair any right consequent thereon. Whenever any
default or Event of Default hereunder shall have been waived as permitted by
this Section 5.07, said default or Event of Default shall for all purposes of
the Securities and this Indenture be deemed to have been cured and to be not
continuing.
SECTION 5.08. Notice of Defaults.
The Trustee shall, within 90 days after the occurrence of a default with
respect to the Securities known to a Responsible Officer of the Trustee, mail to
all Securityholders, as the names and addresses of such holders appear upon the
Security Register, notice of all defaults known to the Trustee, unless such
defaults shall have been cured before the giving of such notice (the term
"defaults" for the purpose of this Section 5.08 being hereby defined to be the
events specified in clauses (a), (b), (c), (d) and (e) of Section 5.01, not
including periods of grace, if any, provided for therein, and irrespective of
the giving of written notice specified in clause (c) of Section 5.01); and
provided that, except in the case of default in the payment of the principal of
or interest (including Compounded Interest or Additional Sums, if any) on any of
the Securities, the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee, or a trust committee
of directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interests of the Securityholders;
and provided further, that in the case of any default of the character specified
in Section 5.01(c) no such notice to Securityholders shall be given until at
least 60 days after the occurrence thereof but shall be given within 90 days
after such occurrence.
SECTION 5.09. Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.09 shall not apply to any suit instituted by
the Trustee, to any suit instituted by any Securityholder, or group of
Securityholders, holding in the aggregate more than 10% in aggregate principal
amount of the Securities outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
interest (including Compounded Interest and Additional Sums, if any) on any
Security against the Company on or after the same shall have become due and
payable.
32
<PAGE>
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee.
With respect to the holders of the Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default and after the curing or
waiving of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default has occurred (which has not been cured or
waived) the Trustee shall exercise such of the rights and powers vested in it by
this Indenture, and use the same degree of care and skill in their exercise, as
a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the curing or
waiving of all Events of Default which may have occurred,
(1) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(2) in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; but, in the case of any
such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer or Officers, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
33
<PAGE>
(c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith, in accordance with the
direction of the Securityholders pursuant to Section 5.07, relating to
the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to it under the
terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 6.02. Reliance on Documents, Opinions, etc.
Except as otherwise provided in Section 6.01:
(a) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, note,
debenture or other paper or document believed by it to be genuine and
to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein may be sufficiently evidenced by an Officers' Certificate
(unless other evidence in respect thereof be herein specifically
prescribed); and any Board Resolution may be evidenced to the Trustee
by a copy thereof certified by the Clerk or an Assistant Clerk of the
Company;
(c) the Trustee may consult with counsel of its selection and any advice
or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered omitted by it
hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders, pursuant to the provisions of
this Indenture, unless such Securityholders shall have offered to the
Trustee reasonable and sufficient security or indemnity against the
costs, expenses and liabilities which may be incurred therein or
thereby;
34
<PAGE>
(e) the Trustee shall not be liable for any action taken or omitted by it
in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;
nothing contained herein shall, however, relieve the Trustee of the
obligation, upon the occurrence of an Event of Default (that has not
been cured or waived), to exercise such of the rights and powers
vested in it by this Indenture, and to use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order,
approval, bond, debenture, coupon or other paper or document, unless
requested in writing to do so by the holders of a majority in
aggregate principal amount of the outstanding Securities; provided,
however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee,
not reasonably assured to the Trustee by the security afforded to it
by the terms of this Indenture, the Trustee may require reasonable
indemnity against such expense or liability as a condition to so
proceeding;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents
(including any Authenticating Agent) or attorneys, and the Trustee
shall not be responsible for any misconduct or negligence on the part
of any such agent or attorney appointed by it with due care;
(h) the Trustee shall not be charged with knowledge of any Default or
Event of Default with respect to the Securities unless (1) such
default is a default under Sections 5.01(a) (other than a default with
respect to the payment of Compounded Interest or Additional Sums) and
5.01(b) of the Indenture, (2) a Responsible Officer shall have actual
knowledge of such Default or Event of Default or (3) written notice of
such Default or Event of Default shall have been given to the Trustee
by the Company or any other obligor on the Securities or by any holder
of the Securities; and
(i) the Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith, without negligence or willful misconduct
and believed by it to be authorized or within the discretion or rights
or powers conferred upon it by this Indenture.
35
<PAGE>
SECTION 6.03. No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities (except in the
certificate of authentication of the Trustee or the Authenticating Agent) shall
be taken as the statements of the Company and the Trustee and the Authenticating
Agent assume no responsibility for the correctness of the same. The Trustee and
the Authenticating Agent make no representations as to the validity or
sufficiency of this Indenture or of the Securities. The Trustee and the
Authenticating Agent shall not be accountable for the use or application by the
Company of any Securities or the proceeds of any Securities authenticated and
delivered by the Trustee or the Authenticating Agent in conformity with the
provisions of this Indenture.
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents, Transfer
Agents or Registrar May Own Securities.
The Trustee or any Authenticating Agent or any paying agent or any transfer
agent or any Security registrar, in its individual or any other capacity, may
become the owner or pledgee of Securities with the same rights it would have if
it were not Trustee, Authenticating Agent, paying agent, transfer agent or
Security registrar.
SECTION 6.05. Moneys to be Held in Trust.
Subject to the provisions of Section 11.04, all moneys received by the
Trustee or any paying agent shall, until used or applied as herein provided, be
held in trust for the purpose for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
and any paying agent shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
So long as no Event of Default shall have occurred and be continuing, all
interest allowed on any such moneys shall be paid from time to time upon the
written order of the Company, signed by the Chairman of the Board of Directors,
the President, a Vice President, the Treasurer or an Assistant Treasurer of the
Company.
SECTION 6.06. Compensation and Expenses of Trustee.
The Company, as issuer of Securities under this Indenture, covenants and
agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing between the
Company and the Trustee (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust), and the Company
will pay or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ) except any such expense, disbursement or advance as may
arise from its negligence or bad faith. The Company also covenants to indemnify
each of the Trustee or
36
<PAGE>
any predecessor Trustee (and its officers, agents, directors and employees) for,
and to hold it harmless against, any and all loss, damage, claim, liability or
expense including taxes (other than taxes based on the income of the Trustee)
incurred without negligence or bad faith on the part of the Trustee and arising
out of or in connection with the acceptance or administration of this trust,
including the costs and expenses of defending itself against any claim of
liability in the premises. The obligations of the Company under this Section
6.06 to compensate and indemnify the Trustee and to pay or reimburse the Trustee
for expenses, disbursements and advances shall constitute additional
indebtedness hereunder. Such additional indebtedness shall be secured by a lien
prior to that of the Securities upon all property and funds held or collected by
the Trustee as such, except funds held in trust for the benefit of the holders
of particular Securities.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.01(d) or Section 5.01(e), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the resignation or removal of
the Trustee and the defeasance or other termination of this Indenture.
SECTION 6.07. Officers' Certificate as Evidence.
Except as otherwise provided in Sections 6.01 and 6.02, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof is herein specifically prescribed) may, in the absence of negligence or
bad faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers' Certificate delivered to the Trustee, and such
certificate, in the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken or omitted by
it under the provisions of this Indenture upon the faith thereof.
SECTION 6.08. Conflicting Interest of Trustee.
If the Trustee has or shall acquire any "conflicting interest" within the
meaning of Section 310(b) of the Trust Indenture Act, the Trustee and the
Company shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.
SECTION 6.09. Eligibility of Trustee.
The Trustee hereunder shall at all times be a corporation organized and
doing business under the laws of the United States of America or any state or
territory thereof or of the District of Columbia or a corporation or other
Person permitted to act as trustee by
37
<PAGE>
the Commission authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000) and subject to supervision or examination by federal, state,
territorial, or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 6.09 the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published.
The Company may not, nor may any Person directly or indirectly controlling,
controlled by, or under common control with the Company, serve as Trustee.
In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 6.09, the Trustee shall resign immediately
in the manner and with the effect specified in Section 6.10.
SECTION 6.10. Resignation or Removal of Trustee.
(a) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign by giving written notice of such resignation to the
Company and by mailing notice thereof to the holders of the Securities
at their addresses as they shall appear on the Security register. Upon
receiving such notice of resignation, the Company shall promptly
appoint a successor trustee or trustees by written instrument, in
duplicate, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have accepted
appointment within 60 days after the mailing of such notice of
resignation to the affected Securityholders, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of
a successor trustee, or any Securityholder who has been a bona fide
holder of a Security for at least six months may, subject to the
provisions of Section 5.09, on behalf of himself and all others
similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, appoint a successor
trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with the provisions of Section
6.08 after written request therefor by the Company or by any
Securityholder who has been a bona fide holder of a Security or
Securities for at least six months, or
38
<PAGE>
(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 6.09 and shall fail to resign after written
request therefor by the Company or by any such Securityholder, or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or
of its property shall be appointed, or any public officer shall
take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, the Company may remove the Trustee and appoint
a successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of
Section 5.09, any Securityholder who has been a bona fide holder of a
Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a
successor trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, remove the Trustee and
appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the Trustee
and nominate a successor trustee, which shall be deemed appointed as
successor trustee unless within 10 days after such nomination the
Company objects thereto or if no successor trustee shall have been so
appointed and shall have accepted appointment within 30 days after
such removal, in which case the Trustee so removed or any Security-
holder, upon the terms and conditions and otherwise as in subsection
(a) of this Section 6.10 provided, may petition any court of competent
jurisdiction for an appointment of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section
6.10 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 6.11.
39
<PAGE>
SECTION 6.11. Acceptance by Successor Trustee.
Any successor trustee appointed as provided in Section 6.10 shall execute,
acknowledge and deliver to the Company and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the retiring trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, duties and obligations of its predecessor hereunder,
with like effect as if originally named as trustee herein; but, nevertheless, on
the written request of the Company or of the successor trustee, the trustee
ceasing to act shall, upon payment of any amounts then due it pursuant to the
provisions of Section 6.06, execute and deliver an instrument transferring to
such successor trustee all the rights and powers of the trustee so ceasing to
act and shall duly assign, transfer and deliver to such successor trustee all
property and money held by such retiring trustee thereunder. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or collected by such
trustee to secure any amounts then due it pursuant to the provisions of Section
6.06.
No successor trustee shall accept appointment as provided in this Section
6.11 unless at the time of such acceptance such successor trustee shall be
qualified under the provisions of Section 6.08 and eligible under the provisions
of Section 6.09.
Upon acceptance of appointment by a successor trustee as provided in this
Section 6.11, the Company shall mail notice of the succession of such trustee
hereunder to the holders of Securities at their addresses as they shall appear
on the Security register. If the Company fails to mail such notice within 10
days after the acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be mailed at the expense of the Company.
SECTION 6.12. Succession by Merger, etc.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any Securities shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate
40
<PAGE>
such Securities either in the name of any predecessor hereunder or in the name
of the successor trustee; and in all such cases such certificates shall have the
full force which the Securities or this Indenture elsewhere provides that the
certificate of the Trustee shall have; provided, however, that the right to
adopt the certificate of authentication of any predecessor Trustee or
authenticate Securities in the name of any predecessor Trustee shall apply only
to its successor or successors by merger, conversion or consolidation.
SECTION 6.13. Limitation on Rights of Trustee as a Creditor.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship described in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent included therein.
SECTION 6.14. Authenticating Agents.
There may be one or more Authenticating Agents appointed by the Trustee
upon the request of the Company with power to act on its behalf and subject to
its direction in the authentication and delivery of Securities issued upon
exchange or transfer thereof as fully to all intents and purposes as though any
such Authenticating Agent had been expressly authorized to authenticate and
deliver Securities; provided, that the Trustee shall have no liability to the
Company for any acts or omissions of the Authenticating Agent with respect to
the authentication and delivery of Securities. Any such Authenticating Agent
shall at all times be a corporation organized and doing business under the laws
of the United States or of any state or territory thereof or of the District of
Columbia authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of at least $50,000,000 and being subject to
supervision or examination by federal, state, territorial or District of
Columbia authority. If such corporation publishes reports of condition at least
annually pursuant to law or the requirements of such authority, then for the
purposes of this Section 6.14 the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect herein specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate trust business
of any Authenticating Agent, shall be the successor of such Authenticating Agent
hereunder, if such successor corporation is otherwise eligible under this
Section 6.14 without the execution or filing of any paper or any further act on
the part of the parties hereto or such Authenticating Agent.
41
<PAGE>
Any Authenticating Agent may at any time resign by giving written notice of
resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time any
Authenticating Agent shall cease to be eligible under this Section 6.14, the
Trustee may, and upon the request of the Company shall, promptly appoint a
successor Authenticating Agent eligible under this Section 6.14, shall give
written notice of such appointment to the Company and shall mail notice of such
appointment to all Securityholders as the names and addresses of such holders
appear on the Security Register. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as Authenticating Agent herein.
The Company, as borrower, agrees to pay to any Authenticating Agent from
time to time reasonable compensation for its services. Any Authenticating Agent
shall have no responsibility or liability for any action taken by it as such in
accordance with the directions of the Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a specified
percentage in aggregate principal amount of the Securities may take any action
(including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action) the fact that at the time
of taking any such action the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by such Securityholders in person or by agent or proxy
appointed in writing, or (b) by the record of such holders of Securities voting
in favor thereof at any meeting of such Securityholders duly called and held in
accordance with the provisions of Article VIII, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of such
Securityholders.
If the Company shall solicit from the Securityholders any request, demand,
authorization, direction, notice, consent, waiver or other action, the Company
may, at its option, as evidenced by an Officers' Certificate, fix in advance a
record date for the determination of Securityholders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other
action, but the Company shall have no obligation to do so. If such a record date
is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other action may be given before or after the record date, but
42
<PAGE>
only the Securityholders of record at the close of business on the record date
shall be deemed to be Securityholders for the purposes of determining whether
Securityholders of the requisite proportion of outstanding Securities have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other action, and for that purpose the
outstanding Securities shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such
Securityholders on the record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than six
months after the record date.
SECTION 7.02. Proof of Execution by Securityholders.
Subject to the provisions of Section 6.01, 6.02 and 8.05, proof of the
execution of any instrument by a Securityholder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The ownership of Securities shall be proved by the Security
Register or by a certificate of the Security registrar. The Trustee may require
such additional proof of any matter referred to in this Section as it shall deem
necessary.
The record of any Securityholders' meeting shall be proved in the manner
provided in Section 8.06.
SECTION 7.03. Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any Security, the
Company, the Trustee, any Authenticating Agent, any paying agent, any transfer
agent and any Security registrar may deem the person in whose name such Security
shall be registered upon the Security Register to be, and may treat him as, the
absolute owner of such Security (whether or not such Security shall be overdue)
for the purpose of receiving payment of or on account of the principal of and
(subject to Section 2.05) interest on such Security and for all other purposes;
and neither the Company nor the Trustee nor any Authenticating Agent nor any
paying agent nor any transfer agent nor any Security registrar shall be affected
by any notice to the contrary. All such payments so made to any holder for the
time being or upon his order shall be valid, and, to the extent of the sum or
sums so paid, effectual to satisfy and discharge the liability for moneys
payable upon any such Security.
SECTION 7.04. Securities Owned by Company Deemed Not Outstanding.
In determining whether the holders of the requisite aggregate principal
amount of Securities have concurred in any direction, consent or waiver under
this Indenture, Securities which are owned by the Company or any other obligor
on the Securities or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Securities shall
43
<PAGE>
be disregarded and deemed not to be outstanding for the purpose of any such
determination; provided that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, consent or waiver, only
Securities which a Responsible Officer of the Trustee actually knows are so
owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as outstanding for the purposes of this Section 7.04
if the pledgee shall establish to the satisfaction of the Trustee the pledgee's
right to vote such Securities and that the pledgee is not the Company or any
such other obligor or Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any such other
obligor. In the case of a dispute as to such right, any decision by the Trustee
taken upon the advice of counsel shall be full protection to the Trustee.
SECTION 7.05. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 7.01, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Securities specified in this
Indenture in connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution therefor),
subject to Section 7.01, the serial number of which is shown by the evidence to
be included in the Securities the holders of which have consented to such action
may, by filing written notice with the Trustee at its principal office and upon
proof of holding as provided in Section 7.02, revoke such action so far as
concerns such Security (or so far as concerns the principal amount represented
by any exchanged or substituted Security). Except as aforesaid any such action
taken by the holder of any Security shall be conclusive and binding upon such
holder and upon all future holders and owners of such Security, and of any
Security issued in exchange or substitution therefor, irrespective of whether or
not any notation in regard thereto is made upon such Security or any Security
issued in exchange or substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings.
A meeting of Securityholders may be called at any time and from time to
time pursuant to the provisions of this Article VIII for any of the following
purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any default
hereunder and its consequences, or to take any other action authorized
to be taken by Securityholders pursuant to any of the provisions of
Article V;
44
<PAGE>
(b) to remove the Trustee and nominate a successor trustee pursuant to the
provisions of Article VI;
(c) to consent to the execution of an indenture or indentures supplemental
hereto pursuant to the provisions of Section 9.02; or
(d) to take any other action authorized to be taken by or on behalf of the
holders of any specified aggregate principal amount of such Securities
under any other provision of this Indenture or under applicable law.
SECTION 8.02. Call of Meetings by Trustee.
The Trustee may at any time call a meeting of Securityholders to take any
action specified in Section 8.01, to be held at such time and at such place in
the Borough of Manhattan, The City of New York, as the Trustee shall determine.
Notice of every meeting of the Securityholders, setting forth the time and the
place of such meeting and in general terms the action proposed to be taken at
such meeting, shall be mailed to holders of Securities at their addresses as
they shall appear on the Securities Register. Such notice shall be mailed not
less than 20 nor more than 180 days prior to the date fixed for the meeting.
SECTION 8.03. Call of Meetings by Company or Securityholders.
In case at any time the Company pursuant to a resolution of the Board of
Directors, or the holders of at least 10% in aggregate principal amount of the
Securities then outstanding, shall have requested the Trustee to call a meeting
of Securityholders, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting within 20 days after receipt of such request,
then the Company or such Securityholders may determine the time and the place in
said Borough of Manhattan for such meeting and may call such meeting to take any
action authorized in Section 8.01, by mailing notice thereof as provided in
Section 8.02.
SECTION 8.04. Qualifications for Voting.
To be entitled to vote at any meeting of Securityholders a Person shall (a)
be a holder of one or more Securities or (b) a Person appointed by an instrument
in writing as proxy by a holder of one or more Securities. The only Persons who
shall be entitled to be present or to speak at any meeting of Securityholders
shall be the Persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
45
<PAGE>
SECTION 8.05. Regulations.
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Securities and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 8.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.
Subject to the provisions of Section 8.04, at any meeting each holder of
Securities or proxy therefor shall be entitled to one vote for each $25
principal amount of Securities held or represented by him; provided, however,
that no vote shall be cast or counted at any meeting in respect of any Security
challenged as not outstanding and ruled by the chairman of the meeting to be not
outstanding. The chairman of the meeting shall have no right to vote other than
by virtue of Securities held by him or instruments in writing as aforesaid duly
designating him as the person to vote on behalf of other Securityholders. Any
meeting of Securityholders duly called pursuant to the provisions of Section
8.02 or 8.03 may be adjourned from time to time by a majority of those present,
and the meeting may be held as so adjourned without further notice.
SECTION 8.06. Voting.
The vote upon any resolution submitted to any meeting of holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of such holders or of their representatives by proxy and the serial
number or numbers of the Securities held or represented by them. The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
triplicate of all votes cast at the meeting. A record in duplicate of the
proceedings of each meeting of Securityholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice was mailed as
provided in Section 8.02. The record shall show the serial numbers of the
Securities voting in favor of or against any resolution. The record shall be
signed and verified by the affidavits of the permanent chairman and secretary of
the meeting and one of the duplicates shall be delivered to the Company and the
other to the Trustee
46
<PAGE>
to be preserved by the Trustee, the latter to have attached thereto the ballots
voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.
The Company, when authorized by a Board Resolution, and the Trustee may
from time to time and at any time amend the Indenture, without the consent of
the Securityholders, for one or more of the following purposes:
(a) to evidence the succession of another Person to the Company, or
successive successions, and the assumption by the successor Person of
the covenants, agreements and obligations of the Company pursuant to
Article X hereof;
(b) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the Securityholders
as the Board of Directors and the Trustee shall consider to be for the
protection of the Securityholders, and to make the occurrence, or the
occurrence and continuance, of a default in any of such additional
covenants, restrictions or conditions a default or an Event of Default
permitting the enforcement of all or any of the remedies provided in
this Indenture as herein set forth; provided, however, that in respect
of any such additional covenant, restriction or condition such
amendment may provide for a particular period of grace after default
(which period may be shorter or longer than that allowed in the case
of other defaults) or may provide for an immediate enforcement upon
such default or may limit the remedies available to the Trustee upon
such default;
(c) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal only)
and to provide for exchangeability of such Securities with the
Securities issued hereunder in fully registered form and to make all
appropriate changes for such purpose;
47
<PAGE>
(d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained herein or
in any supplemental indenture, or to make such other provisions in
regard to matters or questions arising under this Indenture; provided
that any such action shall not materially adversely affect the
interests of the holders of the Securities;
(e) to evidence and provide for the acceptance of appointment hereunder by
a successor trustee with respect to the Securities;
(f) to make provision for transfer procedures, certification, book-entry
provisions and all other matters required pursuant to Section 2.06 or
otherwise necessary, desirable or appropriate in connection with the
issuance of Securities to holders of Preferred Securities in the event
of a distribution of Securities by Independent Capital Trust following
a Dissolution Event;
(g) to qualify or maintain qualification of this Indenture under the Trust
Indenture Act; and
(h) to make any change that does not adversely affect the rights of any
Securityholder in any material respect.
The Trustee is hereby authorized to join with the Company in the execution
of any supplemental indenture to effect such amendment, to make any further
appropriate agreements and stipulations which may be therein contained and to
accept the conveyance, transfer and assignment of any property thereunder, but
the Trustee shall not be obligated to, but may in its discretion, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any amendment to the Indenture authorized by the provisions of this Section
9.01 may be executed by the Company and the Trustee without the consent of the
holders of any of the Securities at the time outstanding, notwithstanding any of
the provisions of Section 9.02.
SECTION 9.02. With Consent of Securityholders.
With the consent (evidenced as provided in Section 7.01) of the holders of
a majority in aggregate principal amount of the Securities at the time
outstanding, the Company, when authorized by a Board Resolution, and the Trustee
may from time to time and at any time amend the Indenture for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
holders of the Securities; provided, however, that no such
48
<PAGE>
amendment shall without the consent of the holders of each Security then
outstanding and affected thereby (i) change the Maturity Date of any Security,
or reduce the rate or extend the time of payment of interest thereon (except as
contemplated by Article XVI), or reduce the principal amount thereof, or reduce
any amount payable on redemption thereof, or make the principal thereof or any
interest thereon payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any Securityholder to institute
suit for payment thereof, or (ii) reduce the aforesaid percentage of Securities
the holders of which are required to consent to any such amendment to the
Indenture, provided, however, that if the Securities are held by Independent
Capital Trust, such amendment shall not be effective until the holders of a
majority in liquidation amount of Trust Securities shall have consented to such
amendment; provided, further, that if the consent of the holder of each
outstanding Security is required, such amendment shall not be effective until
each holder of the Trust Securities shall have consented to such amendment.
Upon the request of the Company accompanied by a copy of a resolution of
the Board of Directors certified by its Clerk or Assistant Clerk authorizing the
execution of any supplemental indenture affecting such amendment, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental
indenture, to the Securityholders as their names and addresses appear upon the
Security Register. Any failure of the Trustee to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.
It shall not be necessary for the consent of the Securityholders under this
Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act; Effect of
Supplemental Indentures.
Any supplemental indenture executed pursuant to the provisions of this
Article IX shall comply with the Trust Indenture Act. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article IX, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Securities shall thereafter be determined, exercised and
49
<PAGE>
enforced hereunder subject in all respects to such modifications and amendments
and all the terms and conditions of any such supplemental indenture shall be and
be deemed to be part of the terms and conditions of this Indenture for any and
all purposes.
SECTION 9.04. Notation on Securities.
Securities authenticated and delivered after the execution of any
supplemental indenture affecting such series pursuant to the provisions of this
Article IX may bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company or the Trustee shall
so determine, new Securities so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may be prepared and executed by the
Company, authenticated by the Trustee or the Authenticating Agent and delivered
in exchange for the Securities then outstanding.
SECTION 9.05. Evidence of Compliance of Supplemental Indenture to be
Furnished Trustee.
The Trustee, subject to the provisions of Sections 6.01 and 6.02, may
receive, in addition to the document required by Section 13.06, an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant hereto complies with the requirements
of this Article IX.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on Certain Terms.
Nothing contained in this Indenture or in any of the Securities shall
prevent any consolidation or merger of the Company with or into any other Person
(whether or not affiliated with the Company, as the case may be), or successive
consolidations or mergers in which the Company or its successor or successors,
as the case may be, shall be a party or parties, or shall prevent any sale,
conveyance, transfer or lease of the property of the Company, or its successor
or successors as the case may be, as an entirety, or substantially as an
entirety, to any other Person (whether or not affiliated with the Company, or
its successor or successors, as the case may be) authorized to acquire and
operate the same; provided, that (a) the Company is the surviving Person, or the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, conveyance, transfer or lease of property is
made is a Person organized and existing under the laws of the United States or
any State thereof or the District of Columbia, and (b) upon any such
consolidation, merger, sale, conveyance, transfer or lease, the due and punctual
payment of the principal of and interest on the Securities according to their
tenor and the due and
50
<PAGE>
punctual performance and observance of all the covenants and conditions of this
Indenture to be kept or performed by the Company shall be expressly assumed, by
supplemental indenture (which shall conform to the provisions of the Trust
Indenture Act, as then in effect) satisfactory in form to the Trustee executed
and delivered to the Trustee by the Person formed by such consolidation, or into
which the Company shall have been merged, or by the Person which shall have
acquired such property, as the case may be, (c) after giving effect to such
consolidation, merger, sale, conveyance, transfer or lease, no Default or Event
of Default shall have occurred and be continuing and (d) such consolidation,
merger, sale, conveyance, transfer or lease does not cause the Securities to be
downgraded by a nationally recognized statistical rating organization.
SECTION 10.02. Successor Corporation to be Substituted for Company.
In case of any such consolidation, merger, conveyance or transfer and upon
the assumption by the successor corporation, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the due
and punctual payment of the principal of and interest on all of the Securities
and the due and punctual performance and observance of all of the covenants and
conditions of this Indenture to be performed or observed by the Company, such
successor Person shall succeed to and be substituted for the Company, with the
same effect as if it had been named herein as the party of the first part, and
the Company thereupon shall be relieved of any further liability or obligation
hereunder or upon the Securities. Such successor Person thereupon may cause to
be signed, and may issue either in its own name or in the name of Independent
Bank Corp., any or all of the Securities issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee or the
Authenticating Agent; and, upon the order of such successor Person instead of
the Company and subject to all the terms, conditions and limitations in this
Indenture prescribed, the Trustee or the Authenticating Agent shall authenticate
and deliver any Securities which previously shall have been signed and delivered
by the officers of the Company to the Trustee or the Authenticating Agent for
authentication, and any Securities which such successor Person thereafter shall
cause to be signed and delivered to the Trustee or the Authenticating Agent for
that purpose. All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Indentures had been issued at the date of the execution hereof.
SECTION 10.03. Opinion of Counsel to be Given Trustee.
The Trustee, subject to the provisions of Sections 6.01 and 6.02, may
receive an Opinion of Counsel as conclusive evidence that any consolidation,
merger, sale, conveyance, transfer or lease, and any assumption, permitted or
required by the terms of this Article X complies with the provisions of this
Article X.
51
<PAGE>
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for cancellation all
Securities theretofore authenticated (other than any Securities which shall have
been destroyed, lost or stolen and which shall have been replaced as provided in
Section 2.07) and not theretofore cancelled, or (b) all the Securities not
theretofore cancelled or delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit with the Trustee, in trust, funds sufficient to pay on the
Maturity Date or upon redemption all of the Securities (other than any
Securities which shall have been destroyed, lost or stolen and which shall have
been replaced as provided in Section 2.07) not theretofore cancelled or
delivered to the Trustee for cancellation, including principal and interest
(including Compounded Interest and Additional Sums, if any) due or to become due
to the Maturity Date or redemption date, as the case may be, but excluding,
however, the amount of any moneys for the payment of principal of or interest
(including Compounded Interest and Additional Sums, if any) on the Securities
(1) theretofore repaid to the Company in accordance with the provisions of
Section 11.04, or (2) paid to any State or to the District of Columbia pursuant
to its unclaimed property or similar laws, and if in either case the Company
shall also pay or cause to be paid all other sums payable hereunder by the
Company, then this Indenture shall cease to be of further effect except for the
provisions of Sections 2.02, 2.06, 2.07, 3.01, 3.02, 3.04, 6.06, 6.10 and 11.04
hereof, which shall survive until such Securities shall mature and be paid.
Thereafter, Sections 6.06, 6.10 and 11.04 shall survive, and the Trustee, on
demand of the Company accompanied by any Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture, the
Company, however, hereby agreeing to reimburse the Trustee for any costs or
expenses thereafter reasonably and properly incurred by the Trustee in
connection with this Indenture or the Securities.
SECTION 11.02. Deposited Moneys and U.S. Government Obligations
to be Held in Trust by Trustee.
Subject to the provisions of Section 11.04, all moneys and U.S. Government
Obligations deposited with the Trustee pursuant to Sections 11.01 or 11.05 shall
be held in trust and applied by it to the payment, either directly or through
any paying agent (including the Company if acting as its own paying agent), to
the holders of the particular Securities for the payment of which such moneys or
U.S. Government Obligations have been deposited with the Trustee, of all sums
due and to become due thereon for principal and interest.
52
<PAGE>
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 11.05 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the holders of outstanding Securities.
SECTION 11.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all moneys then held
by any paying agent of the Securities (other than the Trustee) shall, upon
written demand of the Company, be repaid to it or paid to the Trustee, and
thereupon such paying agent shall be released from all further liability with
respect to such moneys.
SECTION 11.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Trustee or any paying agent for
payment of the principal of or interest on Securities and not applied but
remaining unclaimed by the holders of Securities for two years after the date
upon which the principal of or interest (including Compounded Interest and
Additional Sums, if any) on such Securities, as the case may be, shall have
become due and payable, shall be repaid to the Company by the Trustee or such
paying agent on written demand; and the holder of any of the Securities shall
thereafter look only to the Company for any payment which such holder may be
entitled to collect and all liability of the Trustee or such paying agent with
respect to such moneys shall thereupon cease.
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S.
Government Obligations.
The Company shall be deemed to have been Discharged (as defined below) from
its obligations with respect to the Securities on the 91st day after the
applicable conditions set forth below have been satisfied:
(1) the Company shall have deposited or caused to be deposited irrevocably
with the Trustee or the Defeasance Agent (as defined below) as trust
funds in trust, specifically pledged as security for, and dedicated
solely to, the benefit of the holders of the Securities (i) money in
an amount, or (ii) U.S. Government Obligations which through the
payment of interest and principal in respect thereof in accordance
with their terms will provide, not later than one day before the due
date of any payment, money in an amount, or (iii) a combination of (i)
and (ii), sufficient, in the opinion (with respect to (ii) and (iii))
of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee
and the Defeasance Agent, if any, to pay and discharge each
installment of
53
<PAGE>
principal of and interest on the outstanding Securities on the dates
such installments of principal and interest are due;
(2) if the Securities are then listed on any national securities exchange,
the Company shall have delivered to the Trustee and the Defeasance
Agent, if any, an Opinion of Counsel to the effect that the exercise
of the option under this Section 11.05 would not cause such Securities
to be delisted from such exchange;
(3) no Default or Event of Default with respect to the Securities shall
have occurred and be continuing on the date of such deposit; and
(4) the Company shall have delivered to the Trustee and the Defeasance
Agent, if any, an Opinion of Counsel to the effect that holders of the
Securities will not recognize income, gain or loss for United States
federal income tax purposes as a result of the exercise of the option
under this Section 11.05 and will be subject to United States federal
income tax on the same amount and in the same manner and at the same
times as would have been the case if such option had not been
exercised, and such opinion shall be based on a statute so providing
or be accompanied by a private letter ruling to that effect received
from the United States Internal Revenue Service or a revenue ruling
pertaining to a comparable form of transaction to that effect
published by the United States Internal Revenue Service.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Securities and to have satisfied all the obligations under this Indenture
relating to the Securities (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), except (A) the rights
of holders of Securities to receive, from the trust fund described in clause (1)
above, payment of the principal of and the interest on the Securities when such
payments are due; (B) the Company's obligations with respect to the Securities
under Sections 2.06, 2.07, 5.02 and 11.04; and (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder.
"Defeasance Agent" means another financial institution which is eligible to
act as Trustee hereunder and which assumes all of the obligations of the Trustee
necessary to enable the Trustee to act hereunder. In the event such a Defeasance
Agent is appointed pursuant to this Section, the following conditions shall
apply:
(1) The Trustee shall have approval rights over the document appointing
such Defeasance Agent and the document setting forth such Defeasance
Agent's rights and responsibilities;
54
<PAGE>
(2) The Defeasance Agent shall provide verification to the Trustee
acknowledging receipt of sufficient money and/or U. S. Government
Obligations to meet the applicable conditions set forth in this
Section 11.05.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely Corporate Obligations.
No recourse for the payment of the principal of or interest on any
Security, or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
this Indenture, or in any Security, or because of the creation of any
indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor Person to the Company, either directly or through
the Company or any successor Person to the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly understood that all such liability is
hereby expressly waived and released as a condition of, and as a consideration
for, the execution of this Indenture and the issue of the Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors.
All the covenants, stipulations, promises and agreements in this Indenture
contained by the Company shall bind its successors and assigns whether so
expressed or not.
SECTION 13.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
55
<PAGE>
SECTION 13.03. Surrender of Company Powers.
The Company by instrument in writing executed by authority of 2/3
(two-thirds) of its Board of Directors and delivered to the Trustee may
surrender any of the powers reserved to the Company, and thereupon such power so
surrendered shall terminate both as to the Company, as the case may be, and as
to any successor Person.
SECTION 13.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this Indenture is required
or permitted to be given or served by the Trustee or by the holders of
Securities on the Company may be given or served by being deposited postage
prepaid by first class mail, registered or certified mail, overnight courier
service or conformed telecopy addressed (until another address is filed by the
Company with the Trustee for the purpose) to the Company at 288 Union Street,
Rockland, Massachusetts 02370, Attention: Douglas H. Philipsen, President. Any
notice, direction, request or demand by any Securityholder to or upon the
Trustee shall be deemed to have been sufficiently given or made, for all
purposes, if given or made in writing at the office of the Trustee, 101 Barclay
Street, 21st Floor West, New York, New York 10286, Attention: Corporate Trust,
Trustee Administration (unless another address is provided by the Trustee to the
Company for such purpose). Any notice or communication to a Securityholder shall
be mailed by first class mail to his or her address shown on the register kept
by the Security Registrar. Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its sufficiency with respect
to other Securityholders.
SECTION 13.05. Governing Law.
This Indenture and each Security shall be deemed to be a contract made
under the laws of the State of New York, and for all purposes shall be governed
by and construed in accordance with the laws of said State, without regard to
conflicts of laws principles thereof.
SECTION 13.06. Evidence of Compliance with Conditions Precedent.
Upon any application or demand by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the Company shall furnish
to the Trustee an Officers' Certificate stating that in the opinion of the
signers all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with and an Opinion of
Counsel stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
Each certificate or opinion provided for in this Indenture and delivered to
the Trustee with respect to compliance with a condition or covenant provided for
in this Indenture (except certificates delivered pursuant to Section 3.05) shall
include (1) a state-
56
<PAGE>
ment that the Person making such certificate or opinion has read such covenant
or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based; (3) a statement that, in the opinion of
such Person, he has made such examination or investigation as is necessary to
enable him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
SECTION 13.07. Business Days.
In any case where the date of payment of principal of or interest on the
Securities will not be a Business Day, the payment of such principal of or
interest on the Securities need not be made on such date but may be made on the
next succeeding Business Day, with the same force and effect as if made on the
date of payment and no interest shall accrue for the period from and after such
date, except that if such next succeeding Business Day falls in the next
succeeding calendar year, then such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date.
SECTION 13.08. Trust Indenture Act to Control.
If and to the extent that any provision of this Indenture limits, qualifies
or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control.
SECTION 13.09. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.
SECTION 13.10. Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together constitute but one
and the same instrument.
SECTION 13.11. Separability.
In case any one or more of the provisions contained in this Indenture or in
the Securities shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of
57
<PAGE>
this Indenture or of the Securities, but this Indenture and the Securities shall
be construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.
SECTION 13.12. Assignment.
The Company will have the right at all times to assign any of its
respective rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company, provided that, in the event of any such
assignment, the Company will remain primarily liable for all such obligations.
Subject to the foregoing, the Indenture is binding upon and inures to the
benefit of the parties thereto and their respective successors and assigns. This
Indenture may not otherwise be assigned by the parties thereto.
SECTION 13.13. Acknowledgement of Rights.
The Company acknowledges that, with respect to any Securities held by
Independent Capital Trust or a trustee of such trust, if the Property Trustee of
such Trust fails to enforce its rights under this Indenture as the holder of the
Securities held as the assets of Independent Capital Trust, any holder of
Preferred Securities may institute legal proceedings directly against the
Company to enforce such Property Trustee's rights under this Indenture without
first instituting any legal proceedings against such Property Trustee or any
other person or entity. Notwithstanding the foregoing, if an Event of Default
has occurred and is continuing and such event is attributable to the failure of
the Company to pay principal of or interest on the Securities when due, the
Company acknowledges that a holder of Preferred Securities may directly
institute a proceeding for enforcement of payment to such holder of the
principal of or interest on the Securities having a principal amount equal to
the aggregate liquidation amount of the Preferred Securities of such holder on
or after the respective due date specified in the Securities.
ARTICLE XIV
REDEMPTION OF SECURITIES
SECTION 14.01. Special Event Redemption.
If a Special Event has occurred and is continuing then, notwithstanding
Section 14.02(a) but subject to Section 14.02(c), the Company shall have the
right, at any time within 90 days following the occurrence of such Special
Event, upon (i) not less than 45 days written notice to the Trustee and (ii) not
less than 30 days nor more than 60 days written notice to the Securityholders,
to redeem the Securities, in whole (but not in part), at the Redemption Price.
The Redemption Price shall be paid prior to 12:00 noon, New York time, on the
date of such redemption or such earlier time as the Company determines, provided
that the Company shall deposit with the Trustee an amount sufficient to pay the
58
<PAGE>
Redemption Price by 10:00 a.m., New York time, on the date such Redemption Price
is to be paid.
SECTION 14.02. Optional Redemption by Company.
(a) Subject to the provisions of this Article XIV, the Company shall
have the right to redeem the Securities, in whole or in part, from time to
time, on or after __________, 2002, at the Redemption Price.
If the Securities are only partially redeemed pursuant to this Section
14.02, the Securities to be redeemed shall be selected on a pro rata basis,
by lot or by such other method that the Property Trustee shall deem
appropriate not more than 60 days prior to the date fixed for redemption from
the outstanding Securities not previously called for redemption, provided,
however, that any such method of selection may be made on the basis of the
aggregate principal amount of Securities held by each Securityholder and may
be made by making such adjustments as the Company deems fair and appropriate
in order that only Securities in denominations of $25 or integral multiples
thereof shall be redeemed. The Optional Redemption Price shall be paid prior
to 12:00 noon, New York time, on the date of such redemption or at such
earlier time as the Company determines, provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Optional Redemption
Price by 10:00 a.m., New York time, on the date such Optional Redemption
Price is to be paid.
(b) Notwithstanding the first sentence of Section 14.02, upon the entry of
an order for dissolution of the Independent Capital Trust by a court of
competent jurisdiction, the Securities thereafter will be subject to optional
redemption, in whole only, but not in part, on or after _______, 2002, at the
Redemption Price, and otherwise in accordance with this Article XIV.
(c) Any redemption of Securities pursuant to Section 14.01 or Section 14.02
shall be subject to the receipt by the Company of any required regulatory
approval.
SECTION 14.03. No Sinking Fund.
The Securities are not entitled to the benefit of any sinking fund.
SECTION 14.04. Notice of Redemption; Selection of Securities.
In case the Company shall desire to exercise the right to redeem all, or,
as the case may be, any part of the Securities in accordance with their terms,
it shall fix a date for redemption and shall mail a notice of such redemption at
least 30 and not more than 60 days prior to the date fixed for redemption to the
holders of Securities so to be redeemed as a whole or in part at their last
addresses as the same appear on the Security Register. Such mailing shall be by
first class mail. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the holder
59
<PAGE>
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
Each such notice of redemption shall specify the CUSIP number of the
Securities to be redeemed, the date fixed for redemption, the redemption price
at which the Securities are to be redeemed (or the method by which such
redemption price is to be calculated), the place or places of payment that
payment will be made upon presentation and surrender of the Securities, that
interest accrued to the date fixed for redemption will be paid as specified in
said notice, and that on and after said date interest thereon or on the portions
thereof to be redeemed will cease to accrue. If less than all the Securities are
to be redeemed the notice of redemption shall specify the numbers of the
Securities to be redeemed. In case any Security is to be redeemed in part only,
the notice of redemption shall state the portion of the principal amount thereof
to be redeemed and shall state that on and after the date fixed for redemption,
upon surrender of such Security, a new Security or Securities in principal
amount equal to the unredeemed portion thereof will be issued.
By 10:00 a.m. New York time on the redemption date specified in the notice
of redemption given as provided in this Section, the Company will deposit with
the Trustee or with one or more paying agents an amount of money sufficient to
redeem on the redemption date all the Securities so called for redemption at the
appropriate Redemption Price, together with accrued interest to the date fixed
for redemption.
The Company will give the Trustee notice not less than 45 days prior to the
redemption date as to the aggregate principal amount of Securities to be
redeemed and the Trustee shall select, in such manner as in its sole discretion
it shall deem appropriate and fair, the Securities or portions thereof (in
integral multiples of $25, except as otherwise set forth in the applicable form
of Security) to be redeemed.
SECTION 14.05. Payment of Securities Called for Redemption.
If notice of redemption has been given as provided in Section 14.04, the
Securities or portions of Securities with respect to which such notice has been
given shall become due and payable on the date and at the place or places stated
in such notice at the Redemption Price, together with interest accrued to the
date fixed for redemption (subject to the rights of holders of Securities on the
close of business on a regular record date in respect of an Interest Payment
Date occurring on or prior to the redemption date), and on and after said date
(unless the Company shall default in the payment of such Securities at the
Redemption Price, together with interest accrued to said date) interest
(including Compounded Interest and Additional Sums, if any) on the Securities or
portions of Securities so called for redemption shall cease to accrue. On
presentation and surrender of such Securities at a place of payment specified in
said notice, the said Securities or the specified portions thereof shall be paid
and redeemed by the Company at the Redemption Price, together with interest
(including Compounded Interest and Additional Sums, if any) accrued
60
<PAGE>
thereon to the date fixed for redemption (subject to the rights of holders of
Securities on the close of business on a regular record date in respect of an
Interest Payment Date occurring on or prior to the redemption date).
Upon presentation of any Security redeemed in part only, the Company shall
execute and the Trustee shall authenticate and make available for delivery to
the holder thereof, at the expense of the Company, a new Security or Securities
of authorized denominations, in principal amount equal to the unredeemed portion
of the Security so presented.
ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate.
The Company covenants and agrees, and each holder of Securities issued
hereunder likewise covenants and agrees, that the Securities shall be issued
subject to the provisions of this Article XV; and each holder of a Security,
whether upon original issue or upon transfer or assignment thereof, accepts and
agrees to be bound by such provisions.
The payment by the Company of the principal of and interest (including
Compounded Interest and Additional Sums, if any) on all Securities issued
hereunder shall, to the extent and in the manner hereinafter set forth, be
subordinated and junior in right of payment to all Senior and Subordinated
Indebtedness, whether outstanding at the date of this Indenture or thereafter
incurred.
No provision of this Article XV shall prevent the occurrence of any Default
or Event of Default hereunder.
SECTION 15.02. Default on Senior and Subordinated Indebtedness.
In the event and during the continuation of any default by the Company in
the payment of principal, interest or any other payment due on any Senior and
Subordinated Indebtedness, or in the event that the maturity of any Senior and
Subordinated Indebtedness has been accelerated because of a default, then, in
either case, no payment shall be made by the Company with respect to the
principal (including redemption payments) of or interest on the Securities.
In the event of the acceleration of the maturity of the Securities, then no
payment shall be made by the Company with respect to the principal (including
redemption payments) of or interest on the Securities until the holders of all
Senior and Subordinated
61
<PAGE>
Indebtedness outstanding at the time of such acceleration shall receive payment
in full of such Senior and Subordinated Indebtedness (including any amounts due
upon acceleration).
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraphs of this Section 15.02, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior and
Subordinated Indebtedness or their respective representatives, or to the trustee
or trustees under any indenture pursuant to which any of such Senior and
Subordinated Indebtedness may have been issued, as their respective interests
may appear, but only to the extent that the holders of the Senior and
Subordinated Indebtedness (or their representative or representatives or a
trustee) notify the Trustee in writing, within 90 days of such payment of the
amounts then due and owing on such Senior and Subordinated Indebtedness and only
the amounts specified in such notice to the Trustee shall be paid to the holders
of such Senior and Subordinated Indebtedness.
SECTION 15.03. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of assets of the Company of
any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding-up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all Senior and Subordinated Indebtedness of
the Company shall first be paid in full, or payment thereof provided for in
money in accordance with its terms, before any payment is made by the Company on
account of the principal or interest (including Compounded Interest and
Additional Sums, if any) on the Securities; and upon any such dissolution or
winding-up or liquidation or reorganization, any payment by the Company, or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to which the Securityholders or the Trustee would be
entitled to receive from the Company, except for the provisions of this Article
XV, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Securityholders or by the Trustee under the Indenture if received by
them or it, directly to the holders of Senior and Subordinated Indebtedness of
the Company (pro rata to such holders on the basis of the respective amounts of
Senior and Subordinated Indebtedness held by such holders, as calculated by the
Company) or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing such
Senior and Subordinated Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all such Senior and
Subordinated Indebtedness in full, in money or money's worth, after giving
effect to any concurrent payment or distribution to or for the holders of such
Senior and Subordinated Indebtedness, before any payment or distribution is made
to the Securityholders or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities,
62
<PAGE>
prohibited by the foregoing, shall be received by the Trustee before all Senior
and Subordinated Indebtedness is paid in full, or provision is made for such
payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered to
the holders of such Senior and Subordinated Indebtedness or their representative
or representatives, or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing such Senior and Subordinated Indebtedness
may have been issued, as their respective interests may appear, as calculated by
the Company, for application to the payment of all Senior and Subordinated
Indebtedness remaining unpaid to the extent necessary to pay all such Senior and
Subordinated Indebtedness in full in money in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the benefit of
the holders of such Senior and Subordinated Indebtedness.
For purposes of this Article XV, the words "cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article XV with respect to
the Securities to the payment of Senior and Subordinated Indebtedness that may
at the time be outstanding, provided that (i) such Senior and Subordinated
Indebtedness is assumed by the new corporation, if any, resulting from any such
reorganization or readjustment, and (ii) the rights of the holders of such
Senior and Subordinated Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment. The consolidation of
the Company with, or the merger of the Company into, another Person or the
liquidation or dissolution of the Company following the sale, conveyance,
transfer or lease of its property as an entirety, or substantially as an
entirety, to another Person upon the terms and conditions provided for in
Article X of this Indenture shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 15.03 if such
other Person shall, as a part of such consolidation, merger, sale, conveyance,
transfer or lease, comply with the conditions stated in Article X of this
Indenture. Nothing in Section 15.02 or in this Section 15.03 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 6.06 of this
Indenture.
SECTION 15.04. Subrogation.
Subject to the payment in full of all Senior and Subordinated Indebtedness,
the rights of the Securityholders shall be subrogated to the rights of the
holders of such Senior and Subordinated Indebtedness to receive payments or
distributions of cash, property or securities of the Company, as the case may
be, applicable to such Senior and Subordinated Indebtedness until the principal
of and interest on the Securities shall be paid in full; and, for the purposes
of such subrogation, no payments or distributions to the holders of such Senior
and Subordinated Indebtedness of any cash, property or securities to which the
Securityholders or the Trustee would be entitled except for the provisions of
this Article XV, and no payment over pursuant to the provisions of this Article
XV to or for the benefit of the holders of such Senior and Subordinated
Indebtedness by Securityholders or the
63
<PAGE>
Trustee, shall, as between the Company, its creditors other than holders of
Senior and Subordinated Indebtedness of the Company, and the holders of the
Securities, be deemed to be a payment by the Company to or on account of such
Senior and Subordinated Indebtedness. It is understood that the provisions of
this Article XV are and are intended solely for the purposes of defining the
relative rights of the holders of the Securities, on the one hand, and the
holders of such Senior and Subordinated Indebtedness on the other hand.
Nothing contained in this Article XV or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior and Subordinated Indebtedness of the
Company, and the holders of the Securities, the obligation of the Company, which
is absolute and unconditional, to pay to the holders of the Securities the
principal of and interest (including Compounded Interest and Additional Sums, if
any) on the Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the holders of the Securities and creditors of the Company, as the
case may be, other than the holders of Senior and Subordinated Indebtedness of
the Company, as the case may be, nor shall anything herein or therein prevent
the Trustee or the holder of any Security from exercising all remedies otherwise
permitted by applicable law upon default under the Indenture, subject to the
rights, if any, under this Article XV of the holders of such Senior and
Subordinated Indebtedness in respect of cash, property or securities of the
Company, as the case may be, received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article XV, the Trustee, subject to the provisions of Article VI of this
Indenture, and the Securityholders shall be entitled to conclusively rely upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidation trustee,
agent or other Person making such payment or distribution, delivered to the
Trustee or to the Securityholders, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of Senior and
Subordinated Indebtedness and other indebtedness of the Company, as the case may
be, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article XV.
SECTION 15.05. Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance thereof authorizes
and directs the Trustee on such Securityholder's behalf to take such action as
may be necessary or appropriate to effectuate the subordination provided in this
Article XV and appoints the Trustee such Securityholder's attorney-in-fact for
any and all such purposes.
64
<PAGE>
SECTION 15.06. Notice by the Company.
The Company shall give prompt written notice to a Responsible Officer of
the Trustee of any fact known to the Company that would prohibit the making of
any payment of monies to or by the Trustee in respect of the Securities pursuant
to the provisions of this Article XV. Notwithstanding the provisions of this
Article XV or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts that would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article XV, unless and until a
Responsible Officer of the Trustee shall have received written notice thereof
from the Company or a holder or holders of Senior and Subordinated Indebtedness
or from any trustee therefor; and before the receipt of any such written notice,
the Trustee, subject to the provisions of Article VI of this Indenture, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice provided for in this
Section 15.06 at least two Business Days prior to the date upon which by the
terms hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of or interest (including Compounded
Interest and Additional Sums, if any) on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such money and to apply the same to the purposes for which
they were received, and shall not be affected by any notice to the contrary that
may be received by it within two Business Days prior to such date.
The Trustee, subject to the provisions of Article VI of this Indenture,
shall be entitled to conclusively rely on the delivery to it of a written notice
by a Person representing himself to be a holder of Senior and Subordinated
Indebtedness of the Company (or a trustee on behalf of such holder), as the case
may be, to establish that such notice has been given by a holder of such Senior
and Subordinated Indebtedness or a trustee on behalf of any such holder or
holders. In the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any Person as a holder of such
Senior and Subordinated Indebtedness to participate in any payment or
distribution pursuant to this Article XV, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of such Senior and Subordinated Indebtedness held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution and
any other facts pertinent to the rights of such Person under this Article XV,
and, if such evidence is not furnished, the Trustee may defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment.
Upon any payment or distribution of assets of the Company referred to in
this Article XV, the Trustee and the Securityholders shall be entitled to rely
upon any order or decree entered by any court of competent jurisdiction in which
such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, liquidating trustee,
65
<PAGE>
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to the
Securityholders, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior and
Subordinated Indebtedness and other indebtedness of the Company, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article XV.
SECTION 15.07. Rights of the Trustee; Holders of Senior and
Subordinated Indebtedness.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article XV in respect of any Senior and Subordinated
Indebtedness at any time held by it, to the same extent as any other holder of
Senior and Subordinated Indebtedness, and nothing in this Indenture shall
deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior and Subordinated Indebtedness of the
Company, the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Article XV, and
no implied covenants or obligations with respect to the holders of such Senior
and Subordinated Indebtedness shall be read into this Indenture against the
Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of such Senior and Subordinated Indebtedness and, subject to the
provisions of Article VI of this Indenture, the Trustee shall not be liable to
any holder of such Senior and Subordinated Indebtedness if it shall pay over or
deliver to Securityholders, the Company or any other Person money or assets to
which any holder of such Senior and Subordinated Indebtedness shall be entitled
by virtue of this Article XV or otherwise.
Nothing in this Article XV shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.06.
SECTION 15.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior and Subordinated
Indebtedness of the Company to enforce subordination as herein provided shall at
any time in any way be prejudiced or impaired by any act or failure to act on
the part of the Company, as the case may be, or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company, as the
case may be, with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or otherwise
be charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior and Subordinated Indebtedness of the Company may, at any time
and from time to time, without the consent of or notice to the Trustee or the
Securityholders, without incurring responsibility to the Securityholders and
without impairing or releasing the
66
<PAGE>
subordination provided in this Article XV or the obligations hereunder of the
holders of the Securities to the holders of such Senior and Subordinated
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, such
Senior and Subordinated Indebtedness, or otherwise amend or supplement in any
manner such Senior and Subordinated Indebtedness or any instrument evidencing
the same or any agreement under which such Senior and Subordinated Indebtedness
is outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing such Senior and Subordinated
Indebtedness; (iii) release any Person liable in any manner for the collection
of such Senior and Subordinated Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company, as the case may be, and any other
Person.
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is continuing, the Company
shall have the right, at any time and from time to time during the term of the
Securities, to defer payments of interest by extending the interest payment
period of such Securities for a period not exceeding 20 consecutive quarterly
periods, including the first such quarterly period during such extension period
(the "Extended Interest Payment Period"), during which Extended Interest Payment
Period no interest shall be due and payable; provided that no Extended Interest
Payment Period shall end on a date other than an Interest Payment Date or extend
beyond the Maturity Date. To the extent permitted by applicable law, interest,
the payment of which has been deferred because of the extension of the interest
payment period pursuant to this Section 16.01, will bear interest thereon at the
Coupon Rate compounded quarterly for each quarterly period of the Extended
Interest Payment Period ("Compounded Interest"). At the end of the Extended
Interest Payment Period, the Company shall pay all interest accrued and unpaid
on the Securities, including any Additional Sums and Compounded Interest
(together, "Deferred Interest") that shall be payable to the holders of the
Securities in whose names the Securities are registered in the Security Register
on the first record date preceding the end of the Extended Interest Payment
Period. Before the termination of any Extended Interest Payment Period, the
Company may further defer payments of interest by further extending such period,
provided that such period, together with all such previous and further
extensions within such Extended Interest Payment Period, shall not exceed 20
consecutive quarterly periods, including the first such quarterly period during
such Extended Interest Payment Period, end on a date other than an Interest
Payment Date or extend beyond the Maturity Date of the Securities. Upon the
termination of any Extended Interest Payment Period and the payment of all
Deferred Interest then due, the Company may commence a new Extended Interest
Payment Period, subject to the foregoing requirements. No interest shall be due
and payable during an
67
<PAGE>
Extended Interest Payment Period, except at the end thereof, but the Company may
prepay at any time all or any portion of the interest accrued during an Extended
Interest Payment Period.
SECTION 16.02. Notice of Extension.
(a) If the Property Trustee is the only registered holder of the Securities
at the time the Company selects an Extended Interest Payment Period, the Company
shall give written notice to the Administrative Trustees, the Property Trustee
and the Trustee of its selection of such Extended Interest Payment Period five
Business Days before the earlier of (i) the next succeeding date on which
Distributions on the Trust Securities issued by the Trust are payable, or (ii)
the date the Trust is required to give notice of the record date, or the date
such Distributions are payable, to any national securities exchange or to
holders of the Preferred Securities issued by the Trust, but in any event at
least five Business Days before such record date.
(b) If the Property Trustee is not the only holder of the Securities at the
time the Company selects an Extended Interest Payment Period, the Company shall
give the holders of the Securities and the Trustee written notice of its
selection of such Extended Interest Payment Period at least five Business Days
before the earlier of (i) the next succeeding Interest Payment Date, or (ii) the
date the Company is required to give notice of the record or payment date of
such interest payment to any national securities exchange.
(c) The quarterly period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 16.02 shall be counted as one of the 20
quarterly periods permitted in the maximum Extended Interest Payment Period
permitted under Section 16.01.
The Bank of New York hereby accepts the trusts in this Indenture declared
and provided, upon the terms and conditions hereinabove set forth.
68
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed by their respective officers thereunto duly authorized, as of the
day and year first above written.
INDEPENDENT BANK CORP.
By __________________________________
Name: Richard J. Seaman
Title: Chief Financial Officer
THE BANK OF NEW YORK,
as Trustee
By __________________________________
Name:
Title:
69
<PAGE>
EXHIBIT A
(FORM OF FACE OF SECURITY)
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY.
Principal Amount: _______
No. _____ CUSIP No. ________
INDEPENDENT BANK CORP.
____% JUNIOR SUBORDINATED DEFERRABLE INTEREST
DEBENTURE DUE _____ __, 2027
Independent Bank Corp., a Massachusetts corporation (the "Company",
which term includes any successor Person under the Indenture hereinafter
referred to), for value received, hereby promises to pay to
____________________, as Property Trustee for Independent Capital Trust I or
registered assigns, the principal sum of _________ on _______, 2027; provided
that the Company may shorten the Maturity Date of the principal of this
Security to a date not earlier than ______, 2002 (the "Maturity Date"), and
to pay interest on the outstanding principal amount hereof from ________,
1997, or from the most recent interest payment date (each such date, an
"Interest Payment Date") to which interest has been paid or duly provided
for, quarterly (subject to deferral as set forth herein) in arrears on the
_____ day of March, June, September and December of each year, commencing
_________, 1997, at the rate of _____% per annum until the principal hereof
shall have become due and payable, and on any overdue principal and (without
duplication and to the extent that payment of such interest is enforceable
under applicable law) on any overdue installment of interest at the same rate
per annum compounded quarterly. The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of
twelve 30-day months and, for any period less than a full calendar month, the
number of days elapsed in such month based upon a 30-day month. In the event
that any date on which the principal of or interest on this Security is
payable is not a Business Day, then the payment payable on such date will be
made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), except that if such
next succeeding Business Day falls in the next calendar year, then such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date. Pursuant to the
Indenture, in certain circumstances the Company will be required to pay
Additional Sums and Compounded Interest (each as defined in the Indenture)
with respect to this Security.
The interest installment so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities,
as defined in said Indenture) is registered at the close of business on the
regular record date for such interest installment, which shall be at the close
of business on the Business Day next preceding such Interest Payment Date;
provided, however, that in the event that the Preferred Securities
A-1
<PAGE>
are no longer in book-entry only form or this Security (or one or more
Predecessor Securities) are not represented by a Global Security, the record
date for such payment shall be the [first day of the month/fifteenth day of the
month immediately preceding the month] in which such payment is due. Any such
interest installment not punctually paid or duly provided for shall forthwith
cease to be payable to the holders on such regular record date and may be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a special record date to
be fixed by the Trustee for the payment of such defaulted interest, notice
whereof shall be given to the holders of Securities not less than 10 days prior
to such special record date, or may be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in the Indenture.
The principal of and interest (including Compounded Interest and Additional
Sums, if any) on this Security shall be payable at the office or agency of the
Trustee maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that, payment of interest may be made at the
option of the Company by (i) check mailed to the holder at such address as shall
appear in the Security Register or (ii) by transfer to an account maintained by
the Person entitled thereto, provided that proper written transfer instructions
have been received by the relevant record date.
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and junior in right of payment to the prior payment
in full of all Senior and Subordinated Indebtedness, and this Security is issued
subject to the provisions of the Indenture with respect thereto. Each holder of
this Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each holder hereof, by his or
her acceptance hereof, hereby waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder of
Senior and Subordinated Indebtedness, whether now outstanding or hereafter
incurred, and waives reliance by each such holder upon said provisions.
This Security shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.
A-2
<PAGE>
The provisions of this Security are continued on the reverse side hereof
and such provisions shall for all purposes have the same effect as though fully
set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed and sealed.
Dated: ________________, 1997
INDEPENDENT BANK CORP.
By ___________________________________
Name:
Title:
Attest:
By ___________________________________
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Indenture.
THE BANK OF NEW YORK,
as Trustee
By ___________________________________
Authorized Signatory
A-3
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the Company (herein sometimes
referred to as the "Securities"), specified in the Indenture, all issued or to
be issued under and pursuant to an Indenture, dated as of May __, 1997 (the
"Indenture"), duly executed and delivered between the Company and The Bank of
New York, as Trustee (the "Trustee"), to which Indenture reference is hereby
made for a description of the rights, limitations of rights, obligations, duties
and immunities thereunder of the Trustee, the Company and the holders of the
Securities.
Upon the occurrence and continuation of a Special Event, as defined in the
Indenture, the Company shall have the right, at any time within 90 days
following the occurrence of such Special Event, to redeem this Security in whole
(but not in part), a redemption price equal to the accrued and unpaid interest
on the Security to be so redeemed to the date fixed for redemption, plus 100% of
the principal amount thereof (the "Redemption Price").
In addition, subject to the Company having received the prior approval of
the Federal Reserve, if then required under applicable capital guidelines or
policies of the Federal Reserve, the Company shall have the right to redeem this
Security, in whole or in part, at any time on or after _______, 2002 at the
Redemption Price.
The Redemption Price shall be paid prior to 12:00 noon, New York City
time on the date of such redemption or at such earlier time as the Company
determines, provided, that the Company shall deposit with the Trustee an
amount sufficient to pay the applicable Redemption Price by 10:00 a.m., New
York City time, on the date such Redemption Price is to be paid. Any
redemption pursuant to this paragraph will be made upon not less than 30 days
or more than 60 days notice. If the Securities are only partially redeemed by
the Company, the particular Securities to be redeemed shall be selected on a
pro rata basis, by lot or by such other method that the Property Trustee
shall deem appropriate not more than 60 days prior to the date fixed for
redemption from the outstanding Securities not previously called for
redemption, provided, however, that any such method of selection may be made
on the basis of the aggregate principal amount of Securities held by each
Securityholder thereof and may be made by making such adjustments as the
Company deems fair and appropriate in order that only Securities in
denominations of $25 or integral multiples thereof shall be redeemed.
In the event of redemption of this Security in part only, a new Security or
Securities for the unredeemed portion hereof will be issued in the name of the
holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Securities may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
A-4
<PAGE>
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of a majority in aggregate principal amount of
the Securities at the time outstanding, as defined in the Indenture, to execute
supplemental indentures for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of the Indenture or of
modifying in any manner the rights of the holders of the Securities; provided,
however, that no such supplemental indenture shall, without the consent of each
holder of Securities then outstanding and affected thereby, (i) change the
Maturity Date of any Securities, or reduce the principal amount thereof, or
reduce any amount payable on redemption thereof, or reduce the rate or extend
the time of payment of interest thereon (subject to Article XVI of the
Indenture), or make the principal of, or interest on, the Securities payable in
any coin or currency other than U.S. dollars, or impair or affect the right of
any holder of Securities to institute suit for the payment thereof, or (ii)
reduce the aforesaid percentage of Securities, the holders of which are required
to consent to any such supplemental indenture. The Indenture also contains
provisions permitting the holders of a majority in aggregate principal amount of
the Securities at the time outstanding affected thereby, on behalf of all of the
holders of the Securities, to waive any past default in the performance of any
of the covenants contained in the Indenture, or established pursuant to the
Indenture, and its consequences, except a default in the payment of the
principal of or interest on any of the Securities or a default in respect of any
covenant or provision under which the Indenture cannot be modified or amended
without the consent of each holder of Securities then outstanding. Any such
consent or waiver by the holder of this Security (unless revoked as provided in
the Indenture) shall be conclusive and binding upon such Holder and upon all
future holders and owners of this Security and of any Security issued in
exchange herefor or in place hereof, irrespective of whether or not any notation
of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest (including
Compounded Interest and Additional Sums, if any) on this Security at the time
and place and at the rate and in the money herein prescribed.
So long as no Event of Default shall have occurred and be continuing, the
Company shall have the right, at any time and from time to time during the term
of the Securities, to defer payments of interest by extending the interest
payment period of such Securities for a period not exceeding 20 consecutive
quarterly periods, including the first such quarterly period during such
extension period, and not extending beyond the Maturity Date of the Securities
(an "Extended Interest Payment Period") or ending on a date other than an
Interest Payment Date, at the end of which period the Company shall pay all
interest then accrued and unpaid (together with interest thereon at the rate
specified for the Securities to the extent that payment of such interest is
enforceable under applicable law). Before the termination of any such Extended
Interest Payment Period, the Company may further defer payments of interest by
further extending such Extended Interest Payment Period, provided that such
Extended Interest Payment Period, together with all such
A-5
<PAGE>
previous and further extensions within such Extended Interest Payment Period,
(i) shall not exceed 20 consecutive quarterly periods, including the first
quarterly period during such Extended Interest Payment Period, (ii) shall not
end on any date other than an Interest Payment Date, and (iii) shall not extend
beyond the Maturity Date of the Securities. Upon the termination of any such
Extended Interest Payment Period and the payment of all accrued and unpaid
interest and any additional amounts then due, the Company may commence a new
Extended Interest Payment Period, subject to the foregoing requirements.
The Company has agreed that it will not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock (which includes common and
preferred stock), (ii) make any payment of principal, interest or premium, if
any, on or repay or repurchase or redeem any debt securities of the Company that
rank pari passu with or junior in right of payment to the Securities or (iii)
make any guarantee payments with respect to any guarantee by the Company of the
debt securities of any Subsidiary of the Company if such guarantee ranks pari
passu or junior in right of payment to the Securities (other than (a) dividends
or distributions in shares of, or options, warrants or rights to subscribe for
or purchase shares of, Common Stock of the Company, (b) any declaration of a
dividend in connection with the implementation of a stockholder's rights plan,
or the issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the Preferred
Securities Guarantee, (d) the purchase of fractional shares resulting from a
reclassification of the Company's capital stock, (e) the purchase of fractional
interests in shares of the Company's capital stock pursuant to the exchange or
conversion of such capital stock or the security being exchanged or converted
and (f) purchases of Common Stock related to the issuance of Common Stock or
rights under any of the Company's benefit plans for its directors, officers or
employees or any of the Company's dividend reinvestment plans) if at such time
(1) there shall have occurred any event of which the Company has actual
knowledge that (a) is or, with the giving of notice or the lapse of time, or
both, would be, an Event of Default and (b) in respect of which the Company
shall not have taken reasonable steps to cure, (2) if the Securities are held by
the Property Trustee, the Company shall be in default with respect to its
payment obligations under the Preferred Securities Guarantee or (3) the Company
shall have given notice of its election of the exercise of its right to extend
the interest payment period and any such extension shall be continuing.
Subject to (i) the receipt of any required regulatory approval and (ii) the
receipt by the Company of an opinion of counsel to the effect that such
distribution will not be a taxable event to holders of Preferred Securities, the
Company will have the right at any time to liquidate the Independent Capital
Trust I and cause the Securities to be distributed to the holders of the Trust
Securities in liquidation of the Trust.
The Indenture contains provisions for satisfaction and discharge of the
entire indebtedness of this Security upon compliance by the Company with certain
conditions set forth in the Indenture.
A-6
<PAGE>
The Securities are issuable only in registered form without coupons in
denominations of $25.00 and any integral multiple thereof. As provided in the
Indenture and subject to the transfer restrictions limitations as may be
contained herein and therein from time to time, this Security is transferable by
the holder hereof on the Security Register of the Company, upon surrender of
this Security for registration of transfer at the office or agency of the
Company in the City and State of New York accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or the Trustee duly
executed by the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of authorized denominations and for the
same aggregate principal amount and series will be issued to the designated
transferee or transferees. No service charge will be made for any such
registration of transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of transfer of this Security, the
Company, the Trustee, any authenticating agent, any paying agent, any transfer
agent and the registrar may deem and treat the holder hereof as the absolute
owner hereof (whether or not this Security shall be overdue and notwithstanding
any notice of ownership or writing hereon made by anyone other than the Security
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and (subject to the Indenture) interest due hereon and for all
other purposes, and neither the Company nor the Trustee nor any authenticating
agent nor any paying agent nor any transfer agent nor any registrar shall be
affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of or interest on
this Security, or for any claim based hereon, or otherwise in respect hereof, or
based on or in respect of the Indenture, against any incorporator, stockholder,
officer or director, past, present or future, as such, of the Company or of any
predecessor or successor Person, whether by virtue of any constitution, statute
or rule of law, or by the enforcement of any assessment or penalty or otherwise,
all such liability being, by the acceptance hereof and as part of the
consideration for the issuance hereof, expressly waived and released.
All terms used in this Security that are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
A-7
<PAGE>
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAW PROVISIONS THEREOF.
A-8
<PAGE>
EXHIBIT 4.3
CERTIFICATE OF TRUST
OF
INDEPENDENT CAPITAL TRUST I
This Certificate of Trust is being executed as of April 28, 1997 for
the purposes of organizing a business trust pursuant to the Delaware Business
Trust Act, 12 Del. C. Sections 3801 et seq. (the "Act").
The undersigned hereby certifies as follows:
1. NAME. The name of the business trust is "Independent Capital
Trust I" (the "Trust").
2. DELAWARE TRUSTEE. The name and business address of the Delaware
resident trustee of the Trust meeting the requirements of Section 3807 of the
Act are as follows:
The Bank of New York (Delaware)
23 White Clay Center
Route 273
Newark, Delaware 19711
3. EFFECTIVE. This Certificate of Trust shall be effective
immediately upon filing in the Office of the Secretary of State of the State
of Delaware.
<PAGE>
IN WITNESS WHEREOF, the undersigned, being all of the trustees of
the Trust, have duly executed this Certificate of Trust as of the day and
year first above written.
THE BANK OF NEW YORK
(DELAWARE),
as Delaware Trustee
By: /s/ Mary Jane Morrissey
------------------------
Name: Mary Jane Morrissey
----------------------
ADMINISTRATIVE TRUSTEE
By: /s/ Douglas H. Philipsen
------------------------
Name: Douglas H. Philipsen
ADMINISTRATIVE TRUSTEE
By: /s/ Richard J. Seaman
------------------------
Name: Richard J. Seaman
ADMINISTRATIVE TRUSTEE
By: /s/ Russell N. Viau
------------------------
Name: Russell N. Viau
INDEPENDENT BANK CORP.,
as Sponsor
By: /s/ Douglas H. Philipsen
------------------------
Name: Douglas H. Philipsen
Title: President
2
<PAGE>
EXHIBIT 4.4
AMENDED AND RESTATED DECLARATION
OF TRUST
INDEPENDENT CAPITAL TRUST I
Dated as of May __, 1997
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application . . . . . . . . . . 8
SECTION 2.2 Lists of Holders of Securities . . . . . . . . . . . 9
SECTION 2.3 Reports by the Property Trustee . . . . . . . . . . . 9
SECTION 2.4 Periodic Reports to Property Trustee . . . . . . . . 9
SECTION 2.5 Evidence of Compliance with Conditions Precedent . . 10
SECTION 2.6 Events of Default; Waiver . . . . . . . . . . . . . . 10
SECTION 2.7 Event of Default; Notice . . . . . . . . . . . . . . 11
ARTICLE III
ORGANIZATION
SECTION 3.1 Name . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 3.2 Office . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 3.3 Purpose . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.4 Authority . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.5 Title to Property of the Trust. . . . . . . . . . . . 13
SECTION 3.6 Powers and Duties of the Administrative Trustees . . 13
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees. 16
SECTION 3.8 Powers and Duties of the Property Trustee . . . . . . 17
SECTION 3.9 Certain Duties and Responsibilities of the
Property Trustee . . . . . . . . . . . . . . . . . 20
SECTION 3.10 Certain Rights of Property Trustee . . . . . . . . . 22
SECTION 3.11 Delaware Trustee . . . . . . . . . . . . . . . . . . 24
SECTION 3.12 Execution of Documents . . . . . . . . . . . . . . . 24
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities . . . . . . . . . . . . . . . . . . . . 24
SECTION 3.14 Duration of Trust . . . . . . . . . . . . . . . . . . 25
SECTION 3.15 Mergers . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities . . . . . . . 27
SECTION 4.2 Responsibilities of the Sponsor . . . . . . . . . . . 27
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
Page
<S> <C> <C>
SECTION 4.3 Right to Proceed . . . . . . . . . . . . . . . . . . 27
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee . . . . 28
SECTION 5.2 Delaware Trustee . . . . . . . . . . . . . . . . . . 28
SECTION 5.3 Property Trustee; Eligibility . . . . . . . . . . . . 29
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally . . . . . . . . . . . . 30
SECTION 5.5 Administrative Trustees . . . . . . . . . . . . . . . 30
SECTION 5.6 Delaware Trustee . . . . . . . . . . . . . . . . . . 31
SECTION 5.7 Appointment, Removal and Resignation of Trustees . . 31
SECTION 5.8 Vacancies among Trustees . . . . . . . . . . . . . . 33
SECTION 5.9 Effect of Vacancies . . . . . . . . . . . . . . . . . 33
SECTION 5.10 Meetings . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 5.11 Delegation of Power . . . . . . . . . . . . . . . . . 34
SECTION 5.12 Merger, Conversion, Consolidation or Succession to
Business . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions . . . . . . . . . . . . . . . . . . . . 35
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities . . . . . . . 35
SECTION 7.2 Execution and Authentication. . . . . . . . . . . . . 36
SECTION 7.3 Form and Dating . . . . . . . . . . . . . . . . . . . 36
SECTION 7.4 Registrar and Paying Agent . . . . . . . . . . . . . 38
SECTION 7.5 Paying Agent to Hold Money in Trust . . . . . . . . . 38
SECTION 7.6 Replacement Securities . . . . . . . . . . . . . . . 39
SECTION 7.7 Outstanding Preferred Securities. . . . . . . . . . . 39
SECTION 7.8 Preferred Securities in Treasury. . . . . . . . . . . 39
SECTION 7.9 Temporary Securities . . . . . . . . . . . . . . . . 40
SECTION 7.10 Cancellation . . . . . . . . . . . . . . . . . . . . 41
SECTION 7.11 CUSIP Numbers . . . . . . . . . . . . . . . . . . . . 41
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust . . . . . . . . . . . . . . . . 41
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities . . . . . . . . . . . . . . . 42
SECTION 9.2 Transfer Procedures and Restrictions. . . . . . . . . 43
SECTION 9.3 Deemed Security Holders . . . . . . . . . . . . . . . 47
SECTION 9.4 Book Entry Interests . . . . . . . . . . . . . . . . 47
SECTION 9.5 Notices to Clearing Agency . . . . . . . . . . . . . 48
SECTION 9.6 Appointment of Successor Clearing Agency . . . . . . 48
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 10.2 Exculpation . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.3 Fiduciary Duty . . . . . . . . . . . . . . . . . . . 49
SECTION 10.4 Indemnification . . . . . . . . . . . . . . . . . . . 50
SECTION 10.5 Outside Businesses . . . . . . . . . . . . . . . . . 54
SECTION 10.6 Compensation; Fees . . . . . . . . . . . . . . . . . 54
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.2 Certain Accounting Matters . . . . . . . . . . . . . 55
SECTION 11.3 Banking . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 11.4 Withholding . . . . . . . . . . . . . . . . . . . . . 56
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.2 Meetings of the Holders; Action by Written Consent . 58
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee . 60
SECTION 13.2 Representations and Warranties of Delaware Trustee . 61
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 14.2 Governing Law . . . . . . . . . . . . . . . . . . . . 63
SECTION 14.3 Intention of the Parties . . . . . . . . . . . . . . 63
SECTION 14.4 Headings . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 14.5 Successors and Assigns . . . . . . . . . . . . . . . 63
SECTION 14.6 Partial Enforceability . . . . . . . . . . . . . . . 64
SECTION 14.7 Counterparts . . . . . . . . . . . . . . . . . . . . 64
ANNEX I TERMS OF SECURITIES . . . . . . . . . . . . . . . . . I-1
EXHIBIT A-1 FORM OF PREFERRED SECURITY CERTIFICATE. . . . . . . . A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE . . . . . . . . . A2-1
EXHIBIT B SPECIMEN OF DEBENTURE . . . . . . . . . . . . . . . . B-1
EXHIBIT C UNDERWRITING AGREEMENT . . . . . . . . . . . . . . . C-1
</TABLE>
iv
<PAGE>
CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- ------------------- -----------
<S> <C>
310(a) . . . . . . . . . . . . . . . . . . . . . . . . 5.3
310(b) . . . . . . . . . . . . . . . . . . . . . . . . 5.3(c), 5.3(d)
311(a) . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b) . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
312(a) . . . . . . . . . . . . . . . . . . . . . . . . 2.2(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
313 . . . . . . . . . . . . . . . . . . . . . . . . 2.3
314(a) . . . . . . . . . . . . . . . . . . . . . . . . 2.4; 3.6(j)
314(c) . . . . . . . . . . . . . . . . . . . . . . . . 2.5
315(a) . . . . . . . . . . . . . . . . . . . . . . . . 3.9
315(b) . . . . . . . . . . . . . . . . . . . . . . . . 2.7(a)
315(c) . . . . . . . . . . . . . . . . . . . . . . . . 3.9(a)
315(d) . . . . . . . . . . . . . . . . . . . . . . . . 3.9(b)
316(a) . . . . . . . . . . . . . . . . . . . . . . . . 2.6
316(c) . . . . . . . . . . . . . . . . . . . . . . . . 3.6(e)
317(a) . . . . . . . . . . . . . . . . . . . . . . . . 3.8(e); 3.8(h)
317(b) . . . . . . . . . . . . . . . . . . . . . . . . 3.8(i); 7.5
</TABLE>
_______________
* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.
v
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
INDEPENDENT CAPITAL TRUST I
May __, 1997
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and
effective as of May __, 1997, by the Trustees (as defined herein), the Sponsor
(as defined herein) and by the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees (other than the Property Trustee (as defined
herein)) and the Sponsor established Independent Capital Trust I (the "Trust"),
a trust formed under the Delaware Business Trust Act pursuant to a Declaration
of Trust dated as of April __, 1997 (the "Original Declaration"), and a
Certificate of Trust filed with the Secretary of State of the State of Delaware
on April __ 1997, for the sole purpose of issuing and selling certain
securities representing undivided beneficial interests in the assets of the
Trust and investing the proceeds thereof in certain Debentures of the Debenture
Issuer (each as hereinafter defined), and engaging in only those other
activities necessary, advisable or incidental thereto; and
WHEREAS, as of the date hereof, no interests in the Trust have been
issued; and
WHEREAS, all of the Trustees and the Sponsor, by this Declaration, amend
and restate each and every term and provision of the Original Declaration;
NOW, THEREFORE, it being the intention of the parties hereto to continue
the Trust as a statutory business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust,
the Trustees declare that all assets contributed to the Trust will be held in
trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
<PAGE>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this
Section 1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and
Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration
or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Administrative Trustee" has the meaning set forth in Section 5.1(b).
"Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
"Agent" means any Paying Agent or Registrar.
"Authorized Officer" of a Person means any other Person that is
authorized to legally bind such former Person.
"Book Entry Interest" means a beneficial interest in a Global
Certificate registered in the name of a Clearing Agency or its nominee,
ownership and transfers of which shall be maintained and made through book
entries by a Clearing Agency as described in Section 9.4.
2
<PAGE>
"Business Day" means any day other than a Saturday or a Sunday or a
day on which banking institutions in the City of New York or the City of
Rockland, Massachusetts are authorized or required by law or executive order to
close.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 et seq., as it may be amended from time to
time, or any successor legislation.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Preferred
Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with
the Clearing Agency.
"Closing Time" means the "Closing Time" under the Underwriting
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.
"Commission" means the United States Securities and Exchange
Commission as from time to time constituted, or if any time after the execution
of this Declaration such Commission is not existing and performing the duties
now assigned to it under applicable Federal securities laws, then the body
performing such duties at such time.
"Common Securities" has the meaning specified in Section 7.1(a).
"Common Securities Guarantee" means the guarantee agreement dated as
of May __, 1997 of the Sponsor in respect of the Common Securities.
"Company Indemnified Person" means (a) any Administrative Trustee;
(b) any Affiliate of any Administrative Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Administrative Trustee; or (d) any officer, employee or agent of the Trust or
its Affiliates.
"Corporate Trust Office" means the office of the Property Trustee at
which the corporate trust business of the Property Trustee shall, at any
particular time, be principally administered, which office at the date of
execution of this Agreement is located at 101 Barclay Street, 21st Floor West,
New York, New York 10286.
3
<PAGE>
"Covered Person" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"Debentures" means the _____% Junior Subordinated Deferrable Interest
Debentures due _______, 2027 of the Debenture Issuer issued pursuant to the
Indenture.
"Debenture Issuer" means Independent Bank Corp., a Massachusetts
corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer
of the Debentures under the Indenture.
"Debenture Trustee" means The Bank of New York, a New York banking
corporation, as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Default" means an event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Definitive Preferred Securities" shall have the meaning set forth in
Section 7.3(c).
"Delaware Trustee" has the meaning set forth in Section 5.2.
"Direct Action" shall have the meaning set forth in Section 3.8(e).
"Distribution" means a distribution payable to Holders in accordance
with Section 6.1.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Event of Default" in respect of the Securities means an Event of
Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System.
"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).
4
<PAGE>
"Fiscal Year" has the meaning set forth in Section 11.1.
"Global Preferred Security" has the meaning set forth in
Section 7.3(a).
"Holder" means a Person in whose name a Security is registered, such
Person being a beneficial owner within the meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of May __, 1997, among the
Debenture Issuer and the Debenture Trustee, as amended from time to time.
"Investment Company" means an investment company as defined in the
Investment Company Act.
"Investment Company Act" means the Investment Company Act of 1940,
as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section 3.6(g).
"List of Holders" has the meaning set forth in Section 2.2(a).
"Majority in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Preferred Securities or by
the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of the
aggregate liquidation amount of all outstanding Securities of the relevant
class.
"Prospectus" has the meaning set forth in Section 3.6(b)(i).
"Officers' Certificate" means, with respect to any Person, a
certificate signed by any of the Chairman, a Vice Chairman, the Chief Executive
Officer, the President, a Vice President, the Comptroller, the Secretary/Clerk
or an Assistant Secretary/Clerk of such Person. Any Officers' Certificate
delivered by the Trust shall be signed by at least one Administrative Trustee.
Any Officers' Certificate delivered with respect to compliance with a condition
or covenant provided for in this Declaration shall include:
(a) a statement that each officer signing the Certificate has read
the covenant or condition and the definitions relating thereto;
5
<PAGE>
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
an employee of the Sponsor, and who shall be acceptable to the Property
Trustee.
"Paying Agent" has the meaning specified in Section 7.4.
"Payment Amount" has the meaning specified in Section 6.1.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"Preferred Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of
a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Preferred Securities" means the __% Cumulative Trust Preferred
Securities.
"Preferred Securities Guarantee" means the guarantee agreement dated
as of May __, 1997 of the sponsor in respect of the Preferred Securities.
"Property Trustee" has the meaning set forth in Section 5.3(a).
"Property Trustee Account" has the meaning set forth in Section
3.8(c)(i).
"Quorum" means a majority of the Administrative Trustees or, if there
are only two Administrative Trustees, both of them.
"Registrar" has the meaning set forth in Section 7.4.
6
<PAGE>
"Registration Statement" has the meaning set forth in Section
3.6(b)(i).
"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means any officer within the Corporate Trust
Office of the Property Trustee with direct responsibility for the
administration of this Declaration and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act, or any
successor rule or regulation.
"Securities" or "Trust Securities" means the Common Securities and
the Preferred Securities.
"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities Guarantee and the
Preferred Securities Guarantee.
"Special Event" has the meaning set forth in Section 4(c) of Annex I
hereto.
"Sponsor" means Independent Bank Corp., a Massachusetts corporation,
or any successor entity resulting from any merger, consolidation, amalgamation
or other business combination, in its capacity as sponsor of the Trust.
"Successor Entity" has the meaning set forth in Section 3.15(b)(i).
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
"10% in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Preferred Securities or by
the Trust Indenture Act, Holder(s) of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Preferred Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of 10% or more of the
aggregate liquidation amount of all outstanding Securities of the relevant
class.
7
<PAGE>
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue as a trustee in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"Underwriting Agreement" means the Underwriting Agreement for the
initial offering and sale of Preferred Securities in the form of Exhibit C.
"Unrestricted Global Preferred Security" has the meaning set forth in
Section 9.2(b).
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration in order for
this Declaration to be qualified under the Trust Indenture Act and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities representing
undivided beneficial interests in the assets of the Trust.
8
<PAGE>
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide the Property Trustee, unless the Property Trustee is
Registrar for the Securities, (i) within 14 days after each record date for
payment of Distributions, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time that the List of Holders does not differ from
the most recent List of Holders given to the Property Trustee by the Sponsor
and the Administrative Trustees on behalf of the Trust, and (ii) at any other
time, within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of
Holders given to it or which it receives in the capacity as Paying Agent (if
acting in such capacity), provided that the Property Trustee may destroy any
List of Holders previously given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year, commencing May 15, 1998, the
Property Trustee shall provide to the Holders of the Preferred Securities such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Property Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as are required by Section 314 (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314(a)(4) of the Trust
Indenture Act, such compliance certificate to be delivered annually on or
before 120 days after the end of each fiscal year of the Sponsor. Delivery of
such documents, reports and information to the Property Trustee is for
informational purposes only and the Property Trustee's receipt of such shall
not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Sponsor's
compliance with any of its covenants hereunder (as to which the Property
Trustee is entitled to rely exclusively on Officers' Certificates).
9
<PAGE>
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with
any conditions precedent provided for in this Declaration that relate to any
of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, the Event of Default under
the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority in
aggregate principal amount of the holders of the Debentures (a "Super
Majority") to be waived under the Indenture, the Event of Default under the
Declaration may only be waived by the vote of the Holders of at least the
proportion in aggregate liquidation amount of the Preferred Securities
that the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of Section
316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any
such default shall cease to exist, and any Event of Default with respect to the
Preferred Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other default or an Event of Default with respect to the
Preferred Securities or impair any right consequent thereon. Any waiver by the
Holders of the Preferred Securities of an Event of Default with respect to the
Preferred Securities shall also be deemed to constitute a waiver by the
Holders of the Common Securities of any such Event of Default with respect to
the Common Securities for all purposes of this Declaration without any further
act, vote, or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
10
<PAGE>
(i) is not waivable under the Indenture, except where the Holders
of the Common Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section 2.6(b), the Event
of Default under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of a Super Majority to be waived,
except where the Holders of the Common Securities are deemed to have
waived such Event of Default under the Declaration as provided below in
this Section 2.6(b), the Event of Default under the Declaration may only
be waived by the vote of the Holders of at least the proportion in
aggregate liquidation amount of the Common Securities that the relevant
Super Majority represents of the aggregate principal amount of the
Debentures outstanding;
provided further, the Holders of Common Securities will be deemed to have
waived any such Event of Default and all Events of Default with respect to the
Common Securities and their consequences if all Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated,
and until such Events of Default have been so cured, waived or otherwise
eliminated, the Property Trustee will be deemed to be acting solely on behalf
of the Holders of the Preferred Securities and only the Holders of the
Preferred Securities will have the right to direct the Property Trustee in
accordance with the terms of the Securities. The foregoing provisions of this
Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of
the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the
Trust Indenture Act are hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Subject to the foregoing
provisions of this Section 2.6(b), upon such waiver, any such default shall
cease to exist and any Event of Default with respect to the Common Securities
arising therefrom shall be deemed to have been cured for every purpose of this
Declaration, but no such waiver shall extend to any subsequent or other default
or Event of Default with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee, at the direction of the Holders of the Preferred Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu
of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this
Declaration and the Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after the occurrence
of a default actually known to a Responsible Officer, transmit by mail, first
class postage prepaid, to the Holders, notices of all defaults with respect to
the Securities actually known to a Responsible Officer, unless such defaults
have been cured before the giving
11
<PAGE>
of such notice (the term "defaults" for the purposes of this Section 2.7(a)
being hereby defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); provided that, except for a default in
the payment of principal of or interest (including Compounded Interest and
Additional Sums (as such terms are defined in the Indenture) if any, on any of
the Debentures, the Property Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer in good faith determines that
the withholding of such notice is in the interests of the Holders.
(b) The Property Trustee shall not be deemed to have knowledge of
any default except:
(i) a default under Sections 5.01(a) (other than the payment of
Compounded Interest and Additional Sums) and 5.01(b) of the Indenture; or
(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer charged with the
administration of the Declaration shall have actual knowledge.
(c) Within ten Business Days after the occurrence of any Event of
Default actually known to the Property Trustee, the Property Trustee shall
transmit notice of such Event of Default to the Holders of the Preferred
Securities, the Administrative Trustees and the Sponsor, unless such Event of
Default shall have been cured or waived. The Sponsor and the Administrative
Trustees shall file annually with the Property Trustee a certification as to
whether or not they are in compliance with all the conditions and covenants
applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "Independent Capital Trust I" as such name may be
modified from time to time by the Administrative Trustees following written
notice to the Delaware Trustee, the Property Trustee and the Holders. The
Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o The Bank of New
York, 101 Barclay Street, New York, New York 10286. On ten Business Days
written
12
<PAGE>
notice to the Delaware Trustee, the Property Trustee and the Holders of
Securities, the Administrative Trustees may designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue and sell
the Securities, (b) use the proceeds from the sale of the Securities to acquire
the Debentures, and (c) except as otherwise limited herein, to engage in only
those other activities necessary, advisable or incidental thereto. The Trust
shall not borrow money, issue debt or reinvest proceeds derived from
investments, mortgage or pledge any of its assets, or otherwise undertake (or
permit to be undertaken) any activity that would cause the Trust not to be
classified for United States federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Administrative Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Administrative Trustees in accordance with their powers
shall constitute the act of and serve to bind the Trust and an action taken by
the Property Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the
Trustees acting on behalf of the Trust, no Person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons dealing with the
Trust are entitled to rely conclusively on the power and authority of the
Trustees as set forth in this Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and the
Property Trustee Account or as otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Trust. The Holders
shall not have legal title to any part of the assets of the Trust, but shall
have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Administrative Trustees.
The Administrative Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:
(a) to issue and sell the Securities in accordance with this
Declaration; provided, however, that except as contemplated in Section 7.1(a),
(i) the Trust may issue no more than one series of Preferred Securities and no
more than one series of Common Securities, (ii) there shall be no interests in
the Trust other than the Securities, and (iii)
13
<PAGE>
the issuance of Securities shall be limited to a simultaneous issuance of
both the Preferred Securities and Common Securities at the Closing Time;
(b) in connection with the issuance and sale of the Preferred
Securities at the direction of the Sponsor, to:
(i) prepare and execute a Prospectus (the "Prospectus") in
preliminary and final form prepared by the Sponsor, in relation to the
offering and sale of the Preferred Securities and to execute and file
with the Commission, a Registration Statement (the "Registration
Statement"), including any amendments thereto, for the offering and sale
of the Preferred Securities;
(ii) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be necessary, in order to
qualify or register all or part of the Preferred Securities in any State
in which the Sponsor has determined to qualify or register such
Preferred Securities for sale;
(iii) execute and file an application, prepared by the Sponsor, to
permit the Preferred Securities to trade or be quoted or listed in or on
the Nasdaq Stock Market's National Market or any other securities
exchange or quotation system.
(iv) execute and deliver letters, documents or instruments with
DTC and other Clearing Agencies relating to the Preferred Securities;
(v) execute and file with the Commission a registration statement
on Form 8-A, including any amendments thereto, prepared by the Sponsor,
relating to the registration of the Preferred Securities under Section
12(b) or (g) of the Exchange Act; and
(vi) execute and enter into the Underwriting Agreement providing
for the sale of the Preferred Securities;
(c) to acquire the Debentures with the proceeds of the sale of the
Preferred Securities and the Common Securities; provided, however, that the
Administrative Trustees shall cause legal title to the Debentures to be held
of record in the name of the Property Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee prompt written notice
of the occurrence of a Special Event;
(e) to establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including and with
respect to, for the purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Preferred
14
<PAGE>
Securities and Holders of Common Securities as to such actions and applicable
record dates;
(f) to take all actions and perform such duties as may be required of
the Administrative Trustees pursuant to the terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action, or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;
(j) to give the certificate required by Section 314(a)(4) of the Trust
Indenture Act to the Property Trustee, which certificate may be executed by
any Administrative Trustee;
(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, Registrar for the
Securities or to appoint a Paying Agent for the Securities as provided in
Section 7.4 except for such time as such power to appoint a Paying Agent is
vested in the Property Trustee;
(m) to give prompt written notice to the Property Trustee and to
Holders of any notice received from the Debenture Issuer of its election to
defer payments of interest on the Debentures by extending the interest
payment period under the Indenture;
(n) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders or to enable the
Trust to effect the purposes for which the Trust was created;
(o) to take any action, not inconsistent with this Declaration or with
applicable law, that the Administrative Trustees determine in their
discretion to be nec-
15
<PAGE>
essary or desirable in carrying out the activities of the Trust as set out in
this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified for United States federal
income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes;
(p) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to the
Trust to be duly prepared and filed by the Administrative Trustees, on behalf
of the Trust; and
(q) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing.
The Administrative Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Administrative Trustees shall not
take any action that is inconsistent with the purposes and functions of the
Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees shall have none
of the powers or the authority of the Property Trustee set forth in Section
3.8.
The Administrative Trustees shall take all actions on behalf of the
Trust that are not specifically required by this Declaration to be taken by
any other Trustee.
Any expenses incurred by the Administrative Trustees pursuant to this
Section 3.6 shall be reimbursed by the Debenture Issuer.
SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the Property
Trustee and the Delaware Trustee) shall not, engage in any activity other
than as required or authorized by this Declaration. The Trust shall not:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders pursuant
to the terms of this Declaration and of the Securities;
16
<PAGE>
(ii) acquire any assets other than as expressly provided herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Debentures;
(v) possess any power or otherwise act in such a way as to vary
the Trust assets or the terms of the Securities in any way whatsoever,
except as otherwise expressly provided herein;
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities;
(vii) other than as provided in this Declaration or Annex I, (A)
direct the time, method and place of conducting any proceeding with
respect to any remedy available to the Debenture Trustee, or exercising
any trust or power conferred upon the Debenture Trustee with respect to
the Debentures, (B) waive any past default that is waivable under the
Indenture or (C) exercise any right to rescind or annul any declaration
that the principal of all the Debentures shall be due and payable; or
(viii) consent to any amendment, modification or termination of
the Indenture or the Debentures where such consent shall be required
unless the Trust shall have received an opinion of independent tax
counsel experienced in such matters to the effect that such amendment,
modification or termination will not cause more than an insubstantial
risk that for United States federal income tax purposes the Trust will
not be classified as a grantor trust.
SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the
Holders. The right, title and interest of the Property Trustee to the
Debentures shall vest automatically in each Person who may hereafter be
appointed as Property Trustee in accordance with Section 5.7. Such vesting
and cessation of title shall be effective whether or not conveyancing
documents with regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Administrative Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
17
<PAGE>
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the Holders
and, upon the receipt of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit such funds into the
Property Trustee Account and make payments or cause the Paying Agent to
make payments to the Holders from the Property Trustee Account in
accordance with Section 6.1. Funds in the Property Trustee Account
shall be held uninvested until disbursed in accordance with this
Declaration. The Property Trustee Account shall be an account that is
maintained with a banking institution the rating on whose long-term
unsecured indebtedness by a "nationally recognized statistical rating
organization", as that term is defined for purposes of Rule 436(g)(2)
under the Securities Act, is at least investment grade;
(ii) engage in such ministerial activities as shall be necessary
or appropriate to effect the redemption of the Trust Securities to the
extent the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by the
Administrative Trustees in accordance with the terms of the Securities,
engage in such ministerial activities as shall be necessary or
appropriate to effect the distribution of the Debentures to Holders upon
the occurrence of certain events.
(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to
the terms of the Securities.
(e) Subject to Section 3.9(a), the Property Trustee shall take any
Legal Action which arises out of or in connection with an Event of Default of
which a Responsible Officer has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act. If
an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay the principal of
or interest (including Compounded Interest and Additional Sums, if any) on
the Debentures on the date such principal or interest (including Compounded
Interest and Additional Sums, if any) is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities
may directly institute a proceeding for enforcement of payment to such Holder
of the principal of or interest (including Compounded Interest and Additional
Sums, if any), if any, on the Debentures having a principal amount equal to
the aggregate liquidation amount of the Preferred Securities of such Holder
(a "Direct Action") on or after the respective due date specified in the
Debentures. In connection with such Direct Action, the rights of the Holders
of the Common Securities will be subrogated to the rights of such Holder of
Preferred Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Preferred Securities in such Direct Action. Except
as provided
18
<PAGE>
in the preceding sentence, the Holders of Preferred Securities will not be
able to exercise directly any other remedy available to the holders of the
Debentures.
(f) The Property Trustee shall not resign as a Trustee unless either:
(i) the Trust has been completely liquidated and the proceeds of
the liquidation distributed to the Holders pursuant to the terms of the
Securities; or
(ii) a successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.7 (a "Successor
Property Trustee").
(g) The Property Trustee shall have the legal power to exercise all of
the rights, powers and privileges of a holder of Debentures under the
Indenture and, if an Event of Default actually known to a Responsible Officer
occurs and is continuing, the Property Trustee shall, for the benefit of
Holders, enforce its rights as holder of the Debentures subject to the rights
of the Holders pursuant to the terms of such Securities.
(h) The Property Trustee shall be authorized to undertake any actions
set forth in Section 317(a) of the Trust Indenture Act.
(i) For such time as the Property Trustee is the Paying Agent, the
Property Trustee may authorize one or more Persons to act as additional
Paying Agents and to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act.
Any such additional Paying Agent may be removed by the Property Trustee at
any time the Property Trustee remains as Paying Agent and a successor Paying
Agent or additional Paying Agents may be (but are not required to be)
appointed at any time by the Property Trustee while the Property Trustee is
so acting as Paying Agent.
(j) Subject to this Section 3.8, the Property Trusteeshall have none
of the duties, liabilities, powers or the authority of the Administrative
Trustees set forth in Section 3.6.
Notwithstanding anything expressed or implied to the contrary in this
Declaration or any Annex or Exhibit hereto, (i) the Property Trustee must
exercise the powers set forth in this Section 3.8 in a manner that is
consistent with the purposes and functions of the Trust set out in Section
3.3 and (ii) the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust set out in Section
3.3.
19
<PAGE>
SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee.
(a) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and in the Securities and no implied covenants shall be read
into this Declaration against the Property Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section
2.6) of which a Responsible Officer has actual knowledge, the Property
Trustee shall exercise such of the rights and powers vested in it by this
Declaration, and use the same degree of care and skill in their exercise, as
a prudent person would exercise or use under the circumstances in the conduct
of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee shall
be determined solely by the express provisions of this Declaration
and in the Securities and the Property Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Declaration and in the Securities,
and no implied covenants or obligations shall be read into this
Declaration or the Securities against the Property Trustee; and
(B) in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to
the Property Trustee and conforming to the requirements of this
Declaration; provided, however, that in the case of any such
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Property Trustee, the
Property Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall be
proved that the Property Trustee was negligent in ascertaining the
pertinent facts;
(iii) the Property Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities
20
<PAGE>
relating to the time, method and place of conducting any proceeding for
any remedy available to the Property Trustee, or exercising any trust or
power conferred upon the Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Declaration or
indemnity reasonably satisfactory to the Property Trustee against such
risk or liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the
Property Trustee Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on liability
afforded to the Property Trustee under this Declaration and the Trust
Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied thereon or
in connection therewith;
(vii) the Property Trustee shall not be liable for any interest on
any money received by it except as it may otherwise agree in writing
with the Sponsor. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Property Trustee Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law;
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor
with their respective duties under this Declaration, nor shall the
Property Trustee be liable for any default or misconduct of the
Administrative Trustees or the Sponsor; and
(ix) the Trustee shall not be deemed to have notice of any Event
of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office
of the Trustee, and such notice references the Securities and this
Indenture.
21
<PAGE>
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and
to have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Sponsor or the Administrative
Trustees contemplated by this Declaration may be sufficiently evidenced
by an Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the
Administrative Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel or other
experts of its selection and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of such
experts' area of expertise shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion,
such counsel may be counsel to the Sponsor or any of its Affiliates, and
may include any of its employees. The Property Trustee shall have the
right at any time to seek instructions concerning the administration of
this Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Declaration at the
request or direction of any Holder, unless such Holder shall have
provided to the Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against the costs, expenses
(including reasonable attorneys' fees and expenses and the expenses of
the Property Trustee's agents, nominees or custodians) and liabilities
22
<PAGE>
that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Property Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Property Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in
its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine
to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by
agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry
or investigation;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders, and the signature of the
Property Trustee or its agents alone shall be sufficient and effective
to perform any such action and no third party shall be required to
inquire as to the authority of the Property Trustee to so act or as to
its compliance with any of the terms and provisions of this Declaration,
both of which shall be conclusively evidenced by the Property Trustee's
or its agent's taking such action;
(x) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request instructions from the
Holders which instructions may only be given by the Holders of the same
proportion in liquidation amount of the Securities as would be entitled
to direct the Property Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain from enforcing
such remedy or right or taking such other action until such instructions
are received and (iii) shall be protected in conclusively relying on or
acting in or accordance with such instructions;
23
<PAGE>
(xi) except as otherwise expressly provided by this Declaration,
the Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this Declaration;
and
(xii) the Property Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith, without
negligence, and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Declaration.
(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in
any jurisdiction in which it shall be illegal, or in which the Property
Trustee shall be unqualified or incompetent in accordance with applicable
law, to perform any such act or acts, or to exercise any such right, power,
duty or obligation. No permissive power or authority available to the
Property Trustee shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Administrative Trustees or the Property Trustee
described in this Declaration. Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Business Trust Act. In
the event the Delaware Trustee shall at any time be required to take any
action or perform any duty hereunder, the Delaware Trustee shall be entitled
to the benefits of Section 3.9(b)(ii)-(viii) and Section 3.10. No implied
covenants or obligations shall be read into this Declaration against the
Delaware Trustee.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Administrative Trustees, and except
as otherwise required by the Business Trust Act or this Declaration, any
Administrative Trustee is authorized to execute on behalf of the Trust any
documents that the Administrative Trustees have the power and authority to
execute pursuant to Section 3.6; provided that the Registration Statement
referred to in Section 3.6(b)(i), including any amendments thereto, shall be
signed by all of the Administrative Trustees.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations
as to the value or condition of
24
<PAGE>
the property of the Trust or any part thereof. The Trustees make no
representations as to the validity or sufficiency of this Declaration, the
Debentures or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of Article VIII
hereof, shall have existence up to May __, 2028.
SECTION 3.15 Mergers.
(a) The Trust may not merge with or into, consolidate, amalgamate or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, except as described in Section
3.15(b) and (c).
(b) The Trust may, at the request of the Sponsor, with the consent of
the Administrative Trustees or, if there are more than two, a majority of the
Administrative Trustees and without the consent of the Holders, the Delaware
Trustee or the Property Trustee, merge with or into, consolidate, amalgamate
or be replaced by, or convey, transfer or lease its properties and assets as
an entirety or substantially as an entirety to, a trust organized as such
under the laws of any State; provided that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the Trust
under the Securities; or
(B) substitutes for the Securities other securities having
substantially the same terms as the Securities (the "Successor
Securities") so long as the Successor Securities rank the same as
the Securities rank with respect to Distributions and payments upon
liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Property Trustee
as the holder of the Debentures;
(iii) the Successor Securities are listed, or any Successor
Securities will be listed upon notification of issuance, on any national
securities exchange or with another organization on which the Preferred
Securities are then listed or quoted, if any;
(iv) if the Preferred Securities (including any Successor
Securities) are rated by any nationally recognized statistical rating
organization prior to such transaction, such merger, consolidation,
amalgamation, replacement, conveyance,
25
<PAGE>
transfer or lease does not cause the Preferred Securities (including any
Successor Securities), or if the Debentures are so rated, the
Debentures, to be downgraded by any nationally recognized statistical
rating organization;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders (including the holders of any
Successor Securities) in any material respect (other than with respect
to any dilution of such Holders' interests in the new entity);
(vi) such Successor Entity has a purpose substantially identical
to that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
opinion of an independent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders (including the holders of
any Successor Securities) in any material respect (other than with
respect to any dilution of the Holders' interest in the new
entity); and
(B) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Trust nor
the Successor Entity will be required to register as an Investment
Company;
(viii) the Sponsor or any permitted successor or assignee owns all
of the common securities of such Successor Entity and guarantees the
obligations of such Successor Entity under the Successor Securities at
least to the extent provided by the Preferred Securities Guarantee and
the Common Securities Guarantee; and
(ix) there shall have been furnished to the Property Trustee an
Officer's Certificate and an Opinion of Counsel, each to the effect that
all conditions precedent in this Declaration to such transaction have
been satisfied.
(c) Notwithstanding Section 3.15(b), the Trust shall not, except with
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets as an entirety or substantially
as an entirety to, any other Person or permit any other Person to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or
lease would cause the Trust or the Successor Entity not to be classified as a
grantor trust for United States federal income tax purposes.
26
<PAGE>
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
At the Closing Time, the Sponsor will purchase all of the Common
Securities then issued by the Trust, in an amount equal to at least 3% of the
total capital of the Trust, at the same time as the Preferred Securities are
issued and sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to prepare the Prospectus and Registration Statement for filing by
the Trust with the Commission, including any amendments thereto;
(b) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and to
do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for
execution and filing any documents to be executed and filed by the Trust, as
the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States;
(c) if deemed necessary or advisable by the Sponsor, to prepare for
filing by the Trust an application to permit the Preferred Securities to
trade or be quoted or listed in or on the Nasdaq Stock Market's National
Market or any other securities exchange, quotation system;
(d) to prepare for filing by the Trust with the Commission a
registration statement on Form 8-A, including any amendments thereto,
relating to the registration of the Preferred Securities under Section 12(b)
or (g) of the Exchange Act; and
(e) to negotiate the terms of the Underwriting Agreement providing for
the sale of the Preferred Securities.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of Preferred
Securities, in the event that a failure of the Trust to pay Distributions on
the Preferred Securities is attributable to the failure of the Company to pay
interest or principal on the Debentures, to institute a proceeding directly
against the Debenture Issuer for enforcement of its payment obligations on
the Debentures.
27
<PAGE>
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the Sponsor may,
by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may be
increased or decreased by vote of the Holders of a Majority in liquidation
amount of the Common Securities voting as a class at a meeting of the Holders
of the Common Securities; provided, however, that, the number of Trustees
shall in no event be less than two (2); provided further that (1) one Trustee
shall satisfy the requirements of the Delaware Trustee pursuant to Section
5.2; (2) there shall be at least one Trustee who is an officer of the Sponsor
(an "Administrative Trustee"); and (3) one Trustee shall be the Property
Trustee for so long as this Declaration is required to qualify as an
indenture under the Trust Indenture Act, and such Trustee may also serve as
Delaware Trustee if it meets the applicable requirements. Notwithstanding
the above, unless an Event of Default shall have occurred and be continuing,
at any time or times, for the purpose of meeting the legal requirements of
the Trust Indenture Act or of any jurisdiction in which any part of the
Trust's property may at the time be located, the Holders of a Majority in
liquidation amount of the Common Securities acting as a class at a meeting of
the Holders of the Common Securities, and the Administrative Trustees shall
have power to appoint one or more Persons either to act as a co-trustee,
jointly with the Property Trustee, of all or any part of the Trust's
property, or to act as separate trustee of any such property, in either case
with such powers as may be provided in the instrument of appointment, and to
vest in such Person or Persons in such capacity any property, title, right or
power deemed necessary or desirable, subject to the provisions of this
Declaration. In case an Event of Default has occurred and is continuing, the
Property Trustee alone shall have power to make any such appointment of a
co-trustee.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place of
business in the State of Delaware, and otherwise meets the requirements of
applicable law, provided that, if the Property Trustee has its principal
place of business in the State
28
<PAGE>
of Delaware and otherwise meets the requirements of applicable law, then the
Property Trustee shall also be the Delaware Trustee and Section 3.11 shall
have no application.
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the "Property Trustee")
which shall act as Property Trustee which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million U.S.
dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section 5.3(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report
of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible to so
act under Section 5.3(a), the Property Trustee shall immediately resign in
the manner and with the effect set forth in Section 5.7(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act,
the Property Trustee and the Holder of the Common Securities (as if it were
the obligor referred to in Section 310(b) of the Trust Indenture Act) shall
in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
(d) The Preferred Securities Guarantee and the Indenture shall be deemed
to be specifically described in this Declaration for purposes of clause (i)
of the first proviso contained in Section 310(b) of the Trust Indenture Act.
29
<PAGE>
(e) The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street
21st Floor West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
SECTION 5.4 Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who
is at least 21 years of age or a legal entity that shall act through one or
more Authorized Officers.
SECTION 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
Douglas H. Philipsen
Richard J. Seaman
Russell N. Viau
(a) Except as expressly set forth in this Declaration and except if a
meeting of the Administrative Trustees is called with respect to any matter
over which the Administrative Trustees have power to act, any power of the
Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) An Administrative Trustee shall have the authority set forth in
Section 3.12 to execute on behalf of the Trust any documents which the
Administrative Trustees have the power and authority to cause the Trust to
execute pursuant to Section 3.6.
(c) An Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his
or her power for the purposes of signing any documents which the
Administrative Trustees have power and authority to cause the Trust to
execute pursuant to Section 3.6.
30
<PAGE>
SECTION 5.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
Attention: Corporate Trust Department
SECTION 5.7 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 5.7(b) of this Declaration and to Section 6(b) of
Annex I hereto, Trustees may be appointed or removed without cause at any
time:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, by vote of the Holders
of a Majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred and be continuing
after the issuance of the Securities, with respect to the Property
Trustee or the Delaware Trustee, by vote of Holders of a Majority in
liquidation amount of the Preferred Securities voting as a class at a
meeting of Holders of the Preferred Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 5.7(a) until a Successor Property Trustee ("Successor
Property Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Property Trustee and delivered
to the Administrative Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be removed
in accordance with this Section 5.7(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections
5.2 and 5.4 (a "Successor Delaware Trustee") has been appointed and has
accepted such appointment by written instrument executed by such
Successor Delaware Trustee and delivered to the Administrative Trustees
and the Sponsor.
(c) A Trustee appointed to office shall hold office until his successor
shall have been appointed or until his death, removal or resignation. Any
Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in
31
<PAGE>
writing signed by the Trustee and delivered to the Sponsor and the Trust,
which resignation shall take effect upon such delivery or upon such later
date as is specified therein; provided, however, that:
(i) No such resignation of the Trustee that acts as the Property
Trustee shall be effective:
(A) until a Successor Property Trustee has been appointed and
has accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the Sponsor
and the resigning Property Trustee; or
(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the Holders; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has been
appointed and has accepted such appointment by instrument executed by
such Successor Delaware Trustee and delivered to the Trust, the Sponsor
and the resigning Delaware Trustee.
(d) The Holders of the Common Securities or, if an Event of Default shall
have occurred and be continuing after the issuance of the Securities, the
Holders of the Preferred Securities shall use their best efforts to promptly
appoint a Successor Delaware Trustee or Successor Property Trustee, as the
case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 5.7.
(e) If no Successor Property Trustee or Successor Delaware Trustee shall
have been appointed and accepted appointment as provided in this Section 5.7
within 60 days after delivery of an instrument of resignation or removal, the
Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment
of a Successor Property Trustee or Successor Delaware Trustee. Such court
may thereupon, after prescribing such notice, if any, as it may deem proper
and prescribe, appoint a Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the acts
or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
32
<PAGE>
(g) At the time of resignation or removal of the Property Trustee or the
Delaware Trustee, the Debenture Issuer shall pay to such Trustee any amounts
that may be owed to such Trustee pursuant to Section 10.4.
SECTION 5.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees
is increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Administrative Trustees or,
if there are more than two, a majority of the Administrative Trustees shall
be conclusive evidence of the existence of such vacancy. The vacancy shall
be filled with a Trustee appointed in accordance with Section 5.7.
SECTION 5.9 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee
shall not operate to dissolve, terminate or annul the Trust. Whenever a
vacancy in the number of Administrative Trustees shall occur, until such
vacancy is filled by the appointment of an Administrative Trustee in
accordance with Section 5.7, the Administrative Trustees in office,
regardless of their number, shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Declaration.
SECTION 5.10 Meetings.
If there is more than one Administrative Trustee, meetings of the
Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may
be held at a time and place fixed by resolution of the Administrative
Trustees, provided, however, that meetings of the Administrative Trustees
shall not be held in any jurisdiction which would subject the Trust to
taxation under the laws of such jurisdiction. Notice of any in-person
meetings of the Administrative Trustees shall be hand delivered or otherwise
delivered in writing (including by facsimile, with a hard copy by overnight
courier) not less than 24 hours before such meeting. Notice of any
telephonic meetings of the Administrative Trustees or any committee thereof
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours
before a meeting. Notices shall contain a brief statement of the time, place
and anticipated purposes of the meeting. The presence (whether in person or
by telephone) of an Administrative Trustee at a meeting shall constitute a
waiver of notice of such meeting except where an Administrative Trustee
attends a meeting for the express purpose of objecting to the transaction of
any activity on the ground that the meeting has not been lawfully called or
convened. Unless provided otherwise in this Declaration, any action of
33
<PAGE>
the Administrative Trustees may be taken at a meeting by vote of a majority
of the Administrative Trustees present (whether in person or by telephone)
and eligible to vote with respect to such matter, provided that a Quorum is
present, or without a meeting by the unanimous written consent of the
Administrative Trustees. In the event there is only one Administrative
Trustee, any and all action of such Administrative Trustee shall be evidenced
by a written consent of such Administrative Trustee.
SECTION 5.11 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in
Section 3.6, including any registration statement or amendment thereto filed
with the Commission, or making any other governmental filing; and
(b) the Administrative Trustees shall have power to delegate from time to
time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust
or the names of the Administrative Trustees or otherwise as the
Administrative Trustees may deem expedient, to the extent such delegation is
not prohibited by applicable law or contrary to the provisions of the Trust,
as set forth herein.
SECTION 5.12 Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee or any
Administrative Trustee that is not a natural person, as the case may be, may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Property
Trustee or the Delaware Trustee, as the case may be, shall be a party, or any
Person succeeding to all or substantially all the corporate trust business of
the Property Trustee or the Delaware Trustee, as the case may be, shall be
the successor of the Property Trustee or the Delaware Trustee, as the case
may be, hereunder, provided such Person shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or
any further act on the part of any of the parties hereto.
34
<PAGE>
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with the applicable
terms of the relevant Holder's Securities. If and to the extent that the
Debenture Issuer makes a payment of interest (including Compounded Interest
and Additional Sums) or principal on the Debentures held by the Property
Trustee or any other payments with respect to the Debentures held by the
Property Trustee (the amount of any such payment being a "Payment Amount"),
the Property Trustee shall and is directed, to the extent funds are available
for that purpose, to make a distribution (a "Distribution") of the Payment
Amount to Holders.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrative Trustees shall on behalf of the Trust issue one
class of capital securities representing undivided beneficial interests in
the assets of the Trust having such terms as are set forth in Annex I (the
"Preferred Securities") and one class of common securities representing
undivided beneficial interests in the assets of the Trust having such terms
as are set forth in Annex I (the "Common Securities"). The Trust shall issue
no securities or other interests in the assets of the Trust other than the
Trust Securities.
(b) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this Declaration, the
Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable undivided beneficial interests in the assets of the Trust.
(d) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and
shall be bound by, this Declaration.
35
<PAGE>
SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the Trust by an
Administrative Trustee by manual or facsimile signature. In case any
Administrative Trustee of the Trust who shall have signed any of the
Securities shall cease to be such Administrative Trustee before the
Securities so signed shall be delivered by the Trust, such Securities
nevertheless may be delivered as though the person who signed such Securities
had not ceased to be such Administrative Trustee; and any Securities may be
signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be the Administrative Trustees of the
Trust, although at the date of the execution and delivery of the Declaration
any such person was not such an Administrative Trustee.
(b) One Administrative Trustee shall sign the Preferred Securities for
the Trust by manual or facsimile signature. Unless otherwise determined by
the Trust, such signature shall, in the case of Common Securities, be a
manual signature.
A Preferred Security shall not be valid until authenticated by the manual
or facsimile signature of an authorized signatory of the Property Trustee.
The signature shall be conclusive evidence that the Preferred Security has
been authenticated under this Declaration.
Upon a written order of the Trust signed by one Administrative Trustee,
the Property Trustee shall authenticate the Preferred Securities for original
issue. The aggregate number of Preferred Securities outstanding at any time
shall not exceed the number set forth in the terms in Annex I hereto except
as provided in Section 7.6.
The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Preferred Securities. An authenticating agent may
authenticate Preferred Securities whenever the Property Trustee may do so.
Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee to deal with the Sponsor or an Affiliate.
SECTION 7.3 Form and Dating.
The Preferred Securities and the Property Trustee's certificate of
authentication shall be substantially in the form of Exhibit A-1 and the
Common Securities shall be substantially in the form of Exhibit A-2, each of
which is hereby incorporated in and expressly made a part of this
Declaration. Certificates representing the Securities may be printed,
lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by their
execution thereof. The Securities may have letters, CUSIP or other numbers,
notations or other marks of identification or designation and such legends or
endorsements required by law,
36
<PAGE>
stock exchange rule, agreements to which the Trust is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Trust). The Trust at the direction of the Sponsor shall
furnish any such legend to the Property Trustee in writing. Each Preferred
Security shall be dated the date of its authentication. The terms and
provisions of the Securities set forth in Annex I and the forms of Securities
set forth in Exhibits A-1 and A-2 are part of the terms of this Declaration
and to the extent applicable, the Property Trustee and the Sponsor, by their
execution and delivery of this Declaration, expressly agree to such terms and
provisions and to be bound thereby.
(a) Global Securities. Securities shall be issued in the form of one or
more permanent global Securities in definitive, fully registered form without
distribution coupons as set forth in Exhibit A-1 hereto (a "Global Preferred
Security"), which shall be deposited on behalf of the purchasers of the
Preferred Securities represented thereby with the Property Trustee, as
custodian for the Clearing Agency, and registered in the name of the Clearing
Agency or a nominee of the Clearing Agency, duly executed by the Trust and
authenticated by the Property Trustee as hereinafter provided. The number of
Preferred Securities represented by a Global Preferred Security may from time
to time be increased or decreased by adjustments made on the records of the
Property Trustee and the Clearing Agency or its nominee as hereinafter
provided.
(b) Book-Entry Provisions. This Section 7.3(b) shall apply only to the
Global Preferred Securities and such other Preferred Securities in global
form as may be authorized by the Trust to be deposited with or on behalf of
the Clearing Agency.
The Trust shall execute and the Property Trustee shall, in accordance
with this Section 7.3, authenticate and make available for delivery initially
one or more Global Preferred Securities that (i) shall be registered in the
name of Cede & Co. or other nominee of such Clearing Agency and (ii) shall be
delivered by the Trustee to such Clearing Agency or pursuant to such Clearing
Agency's written instructions or held by the Property Trustee as custodian
for the Clearing Agency.
Members of, or participants in, the Clearing Agency ("Participants")
shall have no rights under this Declaration with respect to any Global
Preferred Security held on their behalf by the Clearing Agency or by the
Property Trustee as the custodian of the Clearing Agency or under such Global
Preferred Security, and the Clearing Agency may be treated by the Trust, the
Property Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Preferred Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Trust, the Property Trustee or any agent of the Trust or the Property Trustee
from giving effect to any written certification, proxy or other authorization
furnished by the Clearing Agency or impair, as between the Clearing Agency
and its Participants, the operation of customary practices of such Clearing
Agency governing the exercise of the rights of a holder of a beneficial
interest in any Global Preferred Security.
37
<PAGE>
(c) Definitive Preferred Securities. Except as provided in Section 7.9
or 9.2(d)(i), owners of beneficial interests in a Global Preferred Security
will not be entitled to receive physical delivery of certificated Preferred
Securities ("Definitive Preferred Securities").
(d) Authorized Denominations. The Preferred Securities are issuable only
in denominations of $25 and any integral multiple thereof.
SECTION 7.4 Registrar and Paying Agent.
The Trust shall maintain in the Borough of Manhattan, The City of New
York, (i) an office or agency where Preferred Securities may be presented for
registration of transfer ("Registrar") and (ii) an office or agency where
Preferred Securities may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Preferred Securities and of their
transfer. The Trust may appoint the Registrar and the Paying Agent and may
appoint one or more co-registrars and one or more additional paying agents in
such other locations as it shall determine. The term "Registrar" includes
any additional registrar and "Paying Agent" includes any additional paying
agent. The Trust may change any Paying Agent, Registrar or co-registrar
without prior notice to any Holder. The Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Administrative
Trustees. The Trust shall notify the Property Trustee of the name and
address of any Agent not a party to this Declaration. If the Trust fails to
appoint or maintain another entity as Registrar or Paying Agent, the Property
Trustee shall act as such. The Trust or any of its Affiliates may act as
Paying Agent or Registrar. The Trust shall act as Paying Agent and
Registrar for the Common Securities.
The Trust initially appoints the Property Trustee as Registrar and Paying
Agent for the Preferred Securities.
SECTION 7.5 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the Property Trustee
to agree in writing that the Paying Agent will hold in trust for the benefit
of Holders or the Property Trustee all money held by the Paying Agent for the
payment of liquidation amounts or Distributions, and will notify the Property
Trustee if there are insufficient funds for such purpose. While any such
insufficiency continues, the Property Trustee may require a Paying Agent to
pay all money held by it to the Property Trustee. The Trust at any time may
require a Paying Agent to pay all money held by it to the Property Trustee
and to account for any money disbursed by it. Upon payment over to the
Property Trustee, the Paying Agent (if other than the Trust or an Affiliate
of the Trust) shall have no further liability for the money. If the Trust or
the Sponsor or an Affiliate of the Trust or the Sponsor acts as Paying Agent,
it shall segregate and hold in a separate trust fund for the benefit of the
Holders all money held by it as Paying Agent.
38
<PAGE>
SECTION 7.6 Replacement Securities.
If a Holder claims that a Security owned by it has been lost, destroyed
or wrongfully taken or if such Security is mutilated and is surrendered to
the Trust or in the case of the Preferred Securities to the Property Trustee,
the Trust shall issue and the Property Trustee shall, upon written order of
the Trust, authenticate a replacement Security if the Property Trustee's and
the Trust's requirements, as the case may be, are met. An indemnity bond
must be provided by the Holder which, in the judgment of the Property
Trustee, is sufficient to protect the Trustees, the Sponsor, the Trust or any
authenticating agent from any loss which any of them may suffer if a Security
is replaced. The Trust may charge such Holder for its expenses in replacing
a Security.
Every replacement Security is an additional beneficial interest in the
Trust.
SECTION 7.7 Outstanding Preferred Securities.
The Preferred Securities outstanding at any time are all the Preferred
Securities authenticated by the Property Trustee except for those cancelled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding.
If a Preferred Security is replaced, paid or purchased pursuant to
Section 7.6 hereof, it ceases to be outstanding unless the Property Trustee
receives proof satisfactory to it that the replaced, paid or purchased
Preferred Security is held by a bona fide purchaser.
If Preferred Securities are considered paid in accordance with the terms
of this Declaration, they cease to be outstanding and Distributions on them
shall cease to accumulate.
A Preferred Security does not cease to be outstanding because one of the
Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 7.8 Preferred Securities in Treasury
In determining whether the Holders of the required amount of Securities
have concurred in any direction, waiver or consent, Preferred Securities
owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as the case
may be, shall be disregarded and deemed not to be outstanding, except that
for the purposes of determining whether the Property Trustee shall be fully
protected in relying on any such direction, waiver or consent, only
Securities which a Responsible Officer of the Property Trustee actually knows
are so owned shall be so disregarded.
39
<PAGE>
SECTION 7.9 Temporary Securities.
(a) Until Definitive Preferred Securities are ready for delivery, the
Trust may prepare and, in the case of the Preferred Securities, the Property
Trustee shall authenticate temporary Securities. Temporary Securities shall
be substantially in the form of Definitive Preferred Securities but may have
variations that the Trust considers appropriate for temporary Securities.
Without unreasonable delay, the Trust shall prepare and, in the case of the
Preferred Securities, the Property Trustee shall authenticate Definitive
Preferred Securities in exchange for temporary Securities.
(b) A Global Preferred Security deposited with the Clearing Agency or
with the Property Trustee as custodian for the Clearing Agency pursuant to
Section 7.3 shall be transferred to the beneficial owners thereof in the form
of Definitive Preferred Securities only if such transfer complies with
Section 9.2 and (i) the Clearing Agency notifies the Sponsor that it is
unwilling or unable to continue as Clearing Agency for such Global Preferred
Security or if at any time such Clearing Agency ceases to be a "clearing
agency" registered under the Exchange Act and a clearing agency is not
appointed by the Sponsor within 90 days of such notice, (ii) a Default or an
Event of Default has occurred and is continuing or (iii) the Trust at its
sole discretion elects to cause the issuance of Definitive Preferred
Securities.
(c) Any Global Preferred Security that is transferable to the beneficial
owners thereof in the form of Definitive Preferred Securities pursuant to
this Section 7.9 shall be surrendered by the Clearing Agency to the Property
Trustee located in the Borough of Manhattan, The City of New York, to be so
transferred, in whole or from time to time in part, without charge, and the
Property Trustee shall authenticate and make available for delivery, upon
such transfer of each portion of such Global Preferred Security, an equal
aggregate liquidation amount of Securities of authorized denominations in the
form of certificated Preferred Securities. Any portion of a Global Preferred
Security in transferred pursuant to this Section shall be registered in such
names as the Clearing Agency shall direct.
(d) Subject to the provisions of Section 7.9(c), the Holder of a Global
Preferred Security may grant proxies and otherwise authorize any Person,
including Participants and Persons that may hold interests through
Participants, to take any action which such Holder is entitled to take under
this Declaration or the Securities.
(e) In the event of the occurrence of any of the events specified in
Section 7.9(b), the Trust will promptly make available to the Property
Trustee a reasonable supply of certificated Preferred Securities in fully
registered form without distribution coupons.
40
<PAGE>
SECTION 7.10 Cancellation.
The Trust at any time may deliver Preferred Securities to the Property
Trustee for cancellation. The Registrar and Paying Agent shall forward to
the Property Trustee any Preferred Securities surrendered to them for
registration of transfer, redemption, or payment. The Property Trustee shall
promptly cancel all Preferred Securities, surrendered for registration of
transfer, redemption, payment, replacement or cancellation and shall dispose
of cancelled Preferred Securities in accordance with its customary procedures
unless the Trust otherwise directs. The Trust may not issue new Preferred
Securities to replace Preferred Securities that it has paid or that have been
delivered to the Property Trustee for cancellation.
SECTION 7.11 CUSIP Numbers.
The Trust in issuing the Preferred Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Property Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders of Preferred
Securities; provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the Preferred
Securities or as contained in any notice of a redemption and that reliance
may be placed only on the other identification numbers printed on the
Preferred Securities, and any such redemption shall not be affected by any
defect in or omission of such numbers. The Sponsor will promptly notify the
Property Trustee of any change in the CUSIP numbers.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall automatically terminate:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or liquidation
or its equivalent with respect to the Sponsor; or the revocation of the
Sponsor's charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;
(iii) following the distribution of a Like Amount of the Debentures
to the Holders, provided that, the Property Trustee has received written
notice from the Sponsor directing the Property Trustee to terminate the
Trust (which direction is optional, and except as otherwise expressly
provided below, within the discretion of the Sponsor) and provided,
further, that such direction and such distribu-
41
<PAGE>
tion is conditioned on (a) the receipt of any required regulatory approval
(including without limitation any required approval of the Federal
Reserve Board) and (b) the Administrative Trustees' receipt of an
opinion of an independent tax counsel experienced in such matters, which
opinion may rely on published rulings of the Internal Revenue Service,
to the effect that the Holders will not recognize any gain or loss for
United States federal income tax purposes as a result of the dissolution
of the Trust and the distribution of Debentures.
(iv) upon the entry of a decree of judicial dissolution of the Trust
by a court of competent jurisdiction;
(v) when all of the Securities shall have been called for redemption and
the amounts necessary for redemption thereof shall have been paid to the
Holders in accordance with the terms of the Securities; or
(vi) the expiration of the term of the Trust provided in Section 3.14.
(b) As soon as is practicable after the occurrence of an event referred
to in Section 8.1(a), the Administrative Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X shall survive the
termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any
Security not made in accordance with this Declaration shall be null and void.
(b) The Administrative Trustees shall provide for the registration of
Preferred Securities and of the transfer of Preferred Securities, which will
be effected without charge but only upon payment (with such indemnity as the
Administrative Trustees may require) in respect of any tax or other
governmental charges that may be imposed in relation to it. Upon surrender
for registration of transfer of any Preferred Securities, the Administrative
Trustees shall cause one or more new Preferred Securities to be issued in the
name of the designated transferee or transferees. Every Preferred Security
surrendered for registration of transfer shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative Trustees
and the Regis-
42
<PAGE>
trant duly executed by the Holder or such Holder's attorney duly
authorized in writing. Each Preferred Security surrendered for registration
of transfer shall be canceled by the Property Trustee. A transferee of a
Preferred Security shall be entitled to the rights and subject to the
obligations of a Holder hereunder upon the receipt by such transferee of a
Preferred Security. By acceptance of a Preferred Security, each transferee
shall be deemed to have agreed to be bound by this Declaration.
(c) For so long as the Trust Securities remain outstanding, the Sponsor
will covenant (i) to directly or indirectly maintain 100% direct or indirect
ownership of the Common Securities of the Trust; provided, however, that any
permitted successor of the Sponsor under the Indenture may succeed to the
Sponsor's ownership of such Common Securities, (ii) to use its reasonable
efforts to cause the Trust (a) to remain a business trust, except in
connection with the distribution of Debentures to the Holders of Trust
Securities in liquidation of the Trust, the redemption of all of the Trust
Securities, or certain mergers, consolidations or amalgamations, each as
permitted by this Declaration, and (b) to otherwise continue to be classified
as a grantor trust for United States federal income tax purposes and (iii) to
use its reasonable efforts to cause each holder of Trust Securities to be
treated as owning an undivided beneficial interest in the Debentures.
SECTION 9.2 Transfer Procedures and Restrictions.
(a) Transfer and Exchange of Definitive Preferred Securities. When
Definitive Preferred Securities are presented to the Registrar or co-registrar
(x) to register the transfer of such Definitive Preferred Securities;
or
(y) to exchange such Definitive Preferred Securities which became
mutilated, destroyed, defaced, stolen or lost, for an equal number of
Definitive Preferred Securities,
the Registrar or co-registrar shall register the transfer or make the
exchange as requested if its reasonable requirements for such transaction are
met; provided, however, that the Definitive Preferred Securities surrendered
for registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form reasonably
satisfactory to the Administrative Trustees and the Registrar or
co-registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing;
(b) Restrictions on Transfer of a Definitive Preferred Security for a
Beneficial Interest in a Global Preferred Security. A Definitive Preferred
Security may not be exchanged for a beneficial interest in a Global Preferred
Security except upon satisfaction of the requirements set forth below. Upon
receipt by the Property Trustee of a Definitive Preferred Security, duly
endorsed or accompanied by appropriate instruments of transfer, in form
satisfactory to the Property Trustee and the Administrative Trustees,
together with written instructions directing the Property Trustee to make,
43
<PAGE>
or to direct the Clearing Agency to make, an adjustment on its books and
records with respect to the appropriate Global Preferred Security to reflect
an increase in the number of the Preferred Securities represented by such
Global Preferred Security, then the Property Trustee shall cancel such
Definitive Preferred Security and cause, or direct the Clearing Agency to
cause, the aggregate number of Preferred Securities represented by the
appropriate Global Preferred Security to be increased accordingly. If no
Global Preferred Securities are then outstanding, the Trust shall issue and
the Property Trustee shall authenticate, upon written order of any
Administrative Trustee, an appropriate number of Preferred Securities in
global form.
(c) Transfer and Exchange of Global Preferred Securities. Subject to
Section 9.2(d), the transfer and exchange of Global Preferred Securities or
beneficial interests therein shall be effected through the Clearing Agency,
in accordance with this Declaration (including applicable restrictions on
transfer set forth herein, if any) and the procedures of the Clearing Agency
therefor.
(d) Transfer of a Beneficial Interest in a Global Preferred Security for
a Definitive Preferred Security.
(i) Any Person having a beneficial interest in a Global Preferred
Security may upon request, but only upon 20 days prior notice to the
Property Trustee, and if accompanied by the information specified below,
exchange such beneficial interest for a Definitive Preferred Security
representing the same number of Preferred Securities. Upon receipt by
the Property Trustee from the Clearing Agency or its nominee on behalf
of any Person having a beneficial interest in a Global Preferred
Security of written instructions or such other form of instructions as
is customary for the Clearing Agency or the Person designated by the
Clearing Agency as having such a beneficial interest in a Global
Preferred Security and a certification from the transferor (in a form
substantially similar to that attached hereto as the form of
"Assignment" in Exhibit A-1), which may be submitted by facsimile, then
the Property Trustee will cause the aggregate number of Preferred
Securities represented by Global Preferred Securities to be reduced on
its books and records and, following such reduction, the Trust will
execute and the Property Trustee will authenticate and make available
for delivery to the transferee a Definitive Preferred Security.
(ii) Definitive Preferred Securities issued in exchange for a
beneficial interest in a Global Preferred Security pursuant to this
Section 9.2(d) shall be registered in such names and in such authorized
denominations as the Clearing Agency, pursuant to instructions from its
Clearing Agency Participants or otherwise, shall instruct the Property
Trustee in writing. The Property Trustee shall deliver such Preferred
Securities to the Persons in whose names such Preferred Securities are
so registered in accordance with such instructions of the Clearing
Agency.
44
<PAGE>
(e) Restrictions on Transfer and Exchange of Global Preferred Securities.
Notwithstanding any other provisions of this Declaration (other than the
provisions set forth in subsection (e) of this Section 9.2 and subsection (b)
of Section 7.9), a Global Preferred Security may not be transferred as a
whole except by the Clearing Agency to a nominee of the Clearing Agency or
another nominee of the Clearing Agency or by the Clearing Agency or any such
nominee to a successor Clearing Agency or a nominee of such successor
Clearing Agency.
(f) Authentication of Definitive Preferred Securities. If at any time:
(i) there occurs a Default or an Event of Default which is continuing,
or
(ii) the Trust, in its sole discretion, notifies the Property
Trustee in writing that it elects to cause the issuance of Definitive
Preferred Securities under this Declaration,
then the Trust will execute, and the Property Trustee, upon receipt of a
written order of the Trust signed by one Administrative Trustee requesting
the authentication and delivery of Definitive Preferred Securities to the
Persons designated by the Trust, will authenticate and make available for
delivery Definitive Preferred Securities, equal in number to the number of
Preferred Securities represented by the Global Preferred Securities, in
exchange for such Global Preferred Securities.
(g) Cancellation or Adjustment of Global Preferred Security. At such
time as all beneficial interests in a Global Preferred Security have either
been exchanged for Definitive Preferred Securities to the extent permitted by
this Declaration or redeemed, repurchased or canceled in accordance with the
terms of this Declaration, such Global Preferred Security shall be canceled
by the Property Trustee. At any time prior to such cancellation, if any
beneficial interest in a Global Preferred Security is exchanged for
Definitive Preferred Securities, Preferred Securities represented by such
Global Preferred Security shall be reduced and an adjustment shall be made on
the books and records of the Clearing Agency and the Registrar, to reflect
such reduction.
(h) Obligations with Respect to Transfers of Preferred Securities.
(i) To permit registrations of transfers, the Trust shall execute
and the Property Trustee shall authenticate Definitive Preferred
Securities and Global Preferred Securities at the Registrar's or
co-registrar's request in accordance with the terms of this Declaration.
(ii) Registrations of transfers will be effected without charge, but
only upon payment (with such indemnity as the Trust or the Sponsor may
require) in
45
<PAGE>
respect of any tax or other governmental charge that may be imposed in
relation to it.
(iii) The Registrar or co-registrar shall not be required to
register the transfer of (a) Preferred Securities during a period
beginning at the opening of business 15 days before the day of mailing
of a notice of redemption or any notice of selection of Preferred
Securities for redemption and ending at the close of business on the day
of such mailing; or (b) any Preferred Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Preferred Security being redeemed in part.
(iv) Prior to the due presentation for registration of transfer of
any Preferred Security, the Trust, the Property Trustee, the Paying
Agent, the Registrar or any co-registrar may deem and treat the Person
in whose name a Preferred Security is registered as the absolute owner
of such Preferred Security for the purpose of receiving Distributions on
such Preferred Security (subject to Section 2(c) of Annex I) and for all
other purposes whatsoever, and none of the Trust, the Property Trustee,
the Paying Agent, the Registrar or any co-registrar shall be affected by
notice to the contrary.
(v) All Preferred Securities issued upon any registration of
transfer pursuant to the terms of this Declaration shall evidence the
same security and shall be entitled to the same benefits under this
Declaration as the Preferred Securities surrendered upon such
registration of transfer.
(i) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no responsibility or
obligation to any beneficial owner of a Global Preferred Security,
a Clearing Agency Participant in the Clearing Agency or other
Person with respect to the accuracy of the records of the Clearing
Agency or its nominee or of any Clearing Agency Participant
thereof, with respect to any ownership interest in the Preferred
Securities or with respect to the delivery to any Clearing Agency
Participant, beneficial owner or other Person (other than the
Clearing Agency) of any notice (including any notice of redemption)
or the payment of any amount, under or with respect to such
Preferred Securities. All notices and communications to be given
to the Holders and all payments to be made to Holders under the
Preferred Securities shall be given or made only to or upon the
order of the registered Holders (which shall be the Clearing Agency
or its nominee in the case of a Global Preferred Security). The
rights of beneficial owners in any Global Preferred Security shall
be exercised only through the Clearing Agency subject to the
applicable rules and procedures of the Clearing Agency. The
Property Trustee may conclusively rely and shall be fully protected
in relying upon information furnished by the Clearing
46
<PAGE>
Agency or any agent thereof with respect to its Clearing Agency
Participants and any beneficial owners.
(ii) The Property Trustee and the Registrar shall have no
obligation or duty to monitor, determine or inquire as to
compliance with any restrictions on transfer imposed under this
Declaration or under applicable law with respect to any transfer of
any interest in any Preferred Security (including any transfers
between or among Clearing Agency Participants or beneficial owners
in any Global Preferred Security) other than to require delivery of
such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required
by, the terms of this Declaration, and to examine the same to
determine substantial compliance as to form with the express
requirements hereof.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Security shall be
registered on the books and records of the Trust as the sole owner of such
Security for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or
other claim to or interest in such Security on the part of any Person,
whether or not the Trust shall have actual or other notice thereof.
SECTION 9.4 Book Entry Interests.
Global Preferred Securities shall initially be registered on the books
and records of the Trust in the name of Cede & Co., the nominee of the
Clearing Agency, and no Preferred SecurityBeneficial Owner will receive a
definitive Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Preferred Securities,
except as provided in Section 7.9 and Section 9.2. Unless and until
definitive, fully registered Preferred Securities certificates have been
issued to the Preferred Security Beneficial Owners pursuant to Section 7.9
and Section 9.2:
(a) the provisions of this Section 9.4 shall be in full force and
effect;
(b) the Trust and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Preferred Securities and
receiving approvals, votes or consents hereunder) as the Holder of the
Preferred Securities and the sole holder of the Global Certificates and
shall have no obligation to the Preferred Security Beneficial Owners;
47
<PAGE>
(c) to the extent that the provisions of this Section 9.4 conflict
with any other provisions of this Declaration, the provisions of this
Section 9.4 shall control; and
(d) the rights of the Preferred Security Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Preferred Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants and the Clearing Agency shall receive and transmit payments
of Distributions on the Global Certificates to such Clearing Agency
Participants. DTC will make book entry transfers among the Clearing
Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, the Trustees shall give all such
notices and communications specified herein to be given to the Holders of
Global Preferred Securities to the Clearing Agency, and shall have no notice
obligations to the Preferred Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Preferred Securities, the Administrative
Trustees may, in their sole discretion, appoint a successor Clearing Agency
with respect to such Preferred Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the Securities
Guarantees and the terms of the Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Holders which shall be made
solely from assets of the Trust; and
48
<PAGE>
(ii) required to pay to the Trust or to any Holder any deficit upon
dissolution or termination of the Trust or otherwise.
(b) The Debenture Issuer shall be liable for all of the debts and
obligations of the Trust (other than in respect of the payment of principal
and interest on the Securities) to the extent not satisfied out of the
Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders
shall be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable in
damages or otherwise to the Trust or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by
such Indemnified Person in good faith on behalf of the Trust and in a manner
such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage
or claim incurred by reason of such Indemnified Person's gross negligence or
willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and, if selected by such Indemnified
Person, has been selected by such Indemnified Person with reasonable care on
behalf of the Trust, including information, opinions, reports or statements
as to the value and amount of the assets, liabilities, profits, losses, or
any other facts pertinent to the existence and amount of assets from which
Distributions to Holders might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person
for its good faith reliance on the provisions of this Declaration. The
provisions of this Declaration, to the extent that they restrict the duties
and liabilities of an Indemnified Person otherwise existing at law or in
equity (other than the duties imposed on the Property Trustee under the Trust
Indenture Act), are agreed by the parties hereto to replace such other duties
and liabilities of such Indemnified Person.
49
<PAGE>
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in a
manner that is, or provides terms that are, fair and reasonable to the
Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative interest
of each party (including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating to such
interests, any customary or accepted industry practices, and any applicable
generally accepted accounting practices or principles. In the absence of bad
faith by the Indemnified Person, the resolution, action or term so made,
taken or provided by the Indemnified Person shall not constitute a breach of
this Declaration or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not
be subject to any other or different standard imposed by this
Declaration.
SECTION 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Trust) by reason of the fact
that he is or was a Company Indemnified Person against expenses (including
attorneys' fees and expenses), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to
50
<PAGE>
the best interests of the Trust, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not,
of itself, create a presumption that the Company Indemnified Person did not
act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his
conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Trust to procure a
judgment in its favor by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees and
expenses) actually and reasonably incurred by him in connection with the
defense or settlement of such action or suit if he acted in good faith
and in a manner he reasonably believed to be in or not opposed to the
best interests of the Trust and except that no such indemnification
shall be made in respect of any claim, issue or matter as to which such
Company Indemnified Person shall have been adjudged to be liable to the
Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such Person is fairly
and reasonably entitled to indemnity for such expenses which such Court
of Chancery or such other court shall deem proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense of any
claim, issue or matter therein, he shall be indemnified, to the full
extent permitted by law, against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the
Debenture Issuer only as authorized in the specific case upon a
determination that indemnification of the Company Indemnified Person is
proper in the circumstances because he has met the applicable standard
of conduct set forth in paragraphs (i) and (ii). Such determination
shall be made (1) by the Administrative Trustees by a majority vote of a
Quorum consisting of such Administrative Trustees who were not parties
to such action, suit or proceeding, (2) if such a Quorum is not
obtainable, or, even if obtainable, if a Quorum of disinterested
Administrative Trustees so directs, by
51
<PAGE>
independent legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.
(v) Expenses (including attorneys' fees and expenses) incurred by a
Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to
in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the
Debenture Issuer in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of
such Company Indemnified Person to repay such amount if it shall
ultimately be determined that he is not entitled to be indemnified by
the Debenture Issuer as authorized in this Section 10.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture
Issuer if a determination is reasonably and promptly made (i) by the
Administrative Trustees by a majority vote of a Quorum of disinterested
Administrative Trustees, (ii) if such a Quorum is not obtainable, or,
even if obtainable, if a Quorum of disinterested Administrative Trustees
so directs, by independent legal counsel in a written opinion or (iii)
the Common Security Holder of the Trust, that, based upon the facts
known to the Administrative Trustees, counsel or the Common Security
Holder at the time such determination is made, such Company Indemnified
Person acted in bad faith or in a manner that such person did not
believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Company Indemnified
Person believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances where the
Administrative Trustees, independent legal counsel or Common Security
Holder reasonably determine that such person deliberately breached his
duty to the Trust or its Common or Preferred Security Holders.
(vi) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 10.4(a) shall
not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any
agreement, vote of stockholders or disinterested directors of the
Debenture Issuer or Preferred Security Holders of the Trust or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office. All rights to
indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Company
Indemnified Person who serves in such capacity at any time while this
Section 10.4(a) is in effect. Any repeal or modification of this
Section 10.4(a) shall not affect any rights or obligations then existing.
(vii) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status as such, whether or not
the Debenture Issuer would
52
<PAGE>
have the power to indemnify him against such liability under the
provisions of this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity,
any constituent entity (including any constituent of a constituent)
absorbed in a consolidation or merger, so that any person who is or was
a director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a
director, trustee, officer, employee or agent of another entity, shall
stand in the same position under the provisions of this Section 10.4(a)
with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had
continued.
(ix) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 10.4(a) shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a Company Indemnified Person and shall inure to the benefit
of the heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the (i) Property Trustee,
(ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee or the
Delaware Trustee, and (iv) any officers, directors, shareholders, members,
partners, employees, representatives, custodians, nominees or agents of the
Property Trustee or the Delaware Trustee (each of the Persons in (i) through
(iv) being referred to as a "Fiduciary Indemnified Person") for, and to hold
each Fiduciary Indemnified Person harmless against, any and all loss,
liability, damage, claim or expense including taxes (other than taxes based
on the income of such Fiduciary Indemnified Person) incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of
defending itself against or investigating any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The obligation to indemnify as set forth in this Section 10.4(b)
shall survive the resignation or removal of the Property Trustee or the
Delaware Trustee and the satisfaction and discharge of this Declaration.
(c) The Debenture Trustee agrees to pay the Property Trustee and the
Delaware Trustee, from time to time, such compensation for all services
rendered by the Property Trustee and the Delaware Trustee hereunder as may be
mutually agreed upon in writing by the Sponsor and the Property Trustee or
the Delaware Trustee, as the case may be, and, except as otherwise expressly
provided herein, to reimburse the Property Trustee and the Delaware Trustee
upon its or their request for all reasonable expenses, disbursements and
advances incurred or made by the Property Trustee or the Delaware Trustee, as
the case may be, in accordance with the provisions of this Declara-
53
<PAGE>
tion, except any such expense, disbursement or advance as may be attributable
to its or their negligence or bad faith.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee (subject to Section 5.3(c)) may engage in or possess an interest in
other business ventures of any nature or description, independently or with
others, similar or dissimilar to the business of the Trust, and the Trust and
the Holders shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom, and the
pursuit of any such venture, even if competitive with the business of the
Trust, shall not be deemed wrongful or improper. No Covered Person, the
Sponsor, the Delaware Trustee, or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee
and the Property Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any
such particular investment or other opportunity. Any Covered Person, the
Delaware Trustee and the Property Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the
Sponsor, or may act as depositary for, trustee or agent for, or act on any
committee or body of holders of, securities or other obligations of the
Sponsor or its Affiliates.
SECTION 10.6 Compensation; Fees.
The Debenture Issuer agrees:
(a) to pay to the Trustees from time to time such compensation for all
services rendered by them hereunder as the parties shall agree in writing
from time to time (which compensation shall not be limited by any provision
of law in regard to the compensation of a trustee of an express trust); and
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this
Declaration (including the reasonable compensation and the expenses and
disbursements of their respective agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence or
bad faith.
The provisions of this Section 10.6 shall survive the dissolution of the
Trust and the termination of this Declaration and the removal or resignation
of any Trustee.
No Trustee may claim any lien or charge on any property of the Trust as a
result of any amount due pursuant to this Section 10.6.
54
<PAGE>
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of
account, records and supporting documents, which shall reflect in reasonable
detail, each transaction of the Trust. The books of account shall be
maintained on the accrual method of accounting, in accordance with generally
accepted accounting principles, consistently applied. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified
public accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders, any annual United States
federal income tax information statement, required by the Code, containing
such information with regard to the Securities held by each Holder as is
required by the Code and the Treasury Regulations. Notwithstanding any right
under the Code to deliver any such statement at a later date, the
Administrative Trustees shall endeavor to deliver all such information
statements within 30 days after the end of each Fiscal Year of the Trust.
(c) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required
by United States federal income tax law, and any other annual income tax
returns required to be filed by the Administrative Trustees on behalf of the
Trust with any state or local taxing authority.
SECTION 11.3 Banking.
The Trust may maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments
of funds in respect of the Debentures held by the Property Trustee shall be
made directly to the Property Trustee Account and no other funds of the Trust
shall be deposited in the Property Trustee Account. The sole signatories for
such accounts shall be designated by the Administrative Trustees; provided,
however, that the Property Trustee shall designate the signatories for the
Property Trustee Account.
55
<PAGE>
SECTION 11.4 Withholding.
The Trust and the Administrative Trustees shall comply with
all withholding requirements under United States federal, state and local
law. The Trust shall request, and the Holders shall provide to the Trust,
such forms or certificates as are necessary to establish an exemption from
withholding with respect to each Holder, and any representations and forms as
shall reasonably be requested by the Trust to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Administrative
Trustees shall file required forms with applicable jurisdictions and, unless
an exemption from withholding is properly established by a Holder, shall
remit amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Trust is required to withhold and pay
over any amounts to any authority with respect to Distributions or
allocations to any Holder, the amount withheld shall be deemed to be a
Distribution in the amount of the withholding to the Holder. In the event of
any claimed over withholding, Holders shall be limited to an action against
the applicable jurisdiction. If the amount required to be withheld was not
withheld from actual Distributions made, the Trust may reduce subsequent
Distributions by the amount of such withholding.
56
<PAGE>
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration
(including Section 7 of the Annex I hereto) or by any applicable terms of the
Securities, this Declaration may only be amended by a written instrument
approved and executed by:
(i) the Administrative Trustees (or if there are more than
two Administrative Trustees a majority of the Administrative Trustees);
(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, the Property Trustee;
and
(iii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, the Delaware Trustee.
(b) No amendment shall be made, and any such purported
amendment shall be void and ineffective:
(i) unless the Property Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
(B) an Opinion of Counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of
the Securities) and that all conditions precedent, if any, in this
Declaration to the execution and delivery of such amendment have been
satisfied,
provided, however, that the Property Trustee shall not be required to sign
any such amendment which affects the rights, powers, duties, obligations or
immunities of the Property Trustee; and
(ii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income taxation as a
grantor trust;
(B) reduce or otherwise adversely affect the powers of
the Property Trustee in contravention of the Trust Indenture Act; or
57
<PAGE>
(C) cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(c) At such time after the Trust has issued any Securities
that remain outstanding, any amendment that would adversely affect the
rights, privileges or preferences of any Holder may be effected only with
such additional requirements as may be set forth in the terms of such
Securities;
(d) Section 9.1(c) and this Section 12.1 shall not be
amended without the consent of all of the Holders;
(e) Article Four shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the Common Securities and;
(f) The rights of the holders of the Common Securities under
Article Five to increase or decrease the number of, and appoint and remove
Trustees shall not be amended without the consent of the Holders of a
Majority in liquidation amount of the Common Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration may be
amended without the consent of the Holders to:
(i) cure any ambiguity, correct or supplement any provision
in this Declaration that may be inconsistent with any other provision of
this Declaration or to make any other provisions with respect to matters
or questions arising under this Declaration which shall not be
inconsistent with the other provisions of the Declaration; and
(ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust
will be classified for United States federal income tax purposes as a
grantor trust at all times that any Securities are outstanding or to
ensure that the Trust will not be required to register as an Investment
Company under the Investment Company Act; and
provided, however, that in each case such action shall not adversely affect
in any material respect the interests of the Holders, and any amendments of
this Declaration shall become effective when notice thereof is given to the
Holders.
SECTION 12.2 Meetings of the Holders; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities may
be called at any time by the Administrative Trustees (or as provided in the
terms of the Securities) to consider and act on any matter on which Holders
of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any
58
<PAGE>
stock exchange on which the Preferred Securities are listed or admitted for
trading. The Administrative Trustees shall call a meeting of the Holders of
such class if directed to do so by the Holders of at least 10% in liquidation
amount of such class of Securities. Such direction shall be given by
delivering to the Administrative Trustees one or more notices in writing
stating that the signing Holders wish to call a meeting and indicating the
general or specific purpose for which the meeting is to be called. Any
Holders calling a meeting shall specify in writing the Security Certificates
held by the Holders exercising the right to call a meeting and only those
Securities specified shall be counted for purposes of determining whether the
required percentage set forth in the second sentence of this paragraph has
been met.
(b) Except to the extent otherwise provided in the terms of
the Securities, the following provisions shall apply to meetings of Holders:
(i) notice of any such meeting shall be given to all the
Holders having a right to vote thereat at least seven days and not more
than 60 days before the date of such meeting. Whenever a vote, consent
or approval of the Holders is permitted or required under this
Declaration or the rules of any stock exchange on which the Preferred
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders. Any action that may
be taken at a meeting of the Holders may be taken without a meeting if a
consent in writing setting forth the action so taken is signed by the
Holders owning not less than the minimum amount of Securities in
liquidation amount that would be necessary to authorize or take such
action at a meeting at which all Holders having a right to vote thereon
were present and voting. Prompt notice of the taking of action without a
meeting shall be given to the Holders entitled to vote who have not
consented in writing. The Administrative Trustees may specify that any
written ballot submitted to the Security Holder for the purpose of taking
any action without a meeting shall be returned to the Trust within the
time specified by the Administrative Trustees;
(ii) each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate,
including waiving notice of any meeting, or voting or participating at a
meeting. No proxy shall be valid after the expiration of 11 months from
the date thereof unless otherwise provided in the proxy. Every proxy
shall be revocable at the pleasure of the Holder executing it. Except as
otherwise provided herein, all matters relating to the giving, voting or
validity of proxies shall be governed by the General Corporation Law of
the State of Delaware relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Delaware corporation and the Holders
were stockholders of a Delaware corporation;
59
<PAGE>
(iii) each meeting of the Holders shall be conducted by the
Administrative Trustees or by such other Person that the Administrative
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing rules of
any stock exchange on which the Preferred Securities are then listed or
trading, otherwise provides, the Administrative Trustees, in their sole
discretion, shall establish all other provisions relating to meetings of
Holders, including notice of the time, place or purpose of any meeting at
which any matter is to be voted on by any Holders, waiver of any such
notice, action by consent without a meeting, the establishment of a
record date, quorum requirements, voting in person or by proxy or any
other matter with respect to the exercise of any such right to vote,
provided, however, the meetings of Holders shall not be held in any
jurisdiction which would subject the Trust to taxation under the laws of
such jurisdiction.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee.
The Trustee that acts as initial Property Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Property Trustee represents and warrants to the Trust and
the Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) The Property Trustee is a New York banking corporation,
a national banking association or a bank or trust company organized under the
laws of any State of the United States or the District of Columbia, in any
case with trust powers and authority to execute and deliver, and to carry out
and perform its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Property
Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Property Trustee. This Declaration has
been duly executed and delivered by the Property Trustee and constitutes a
legal, valid and binding obligation of the Property Trustee, enforceable
against it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law);
60
<PAGE>
(c) The execution, delivery and performance of this
Declaration by the Property Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Property Trustee; and
(d) No consent, approval or authorization of, or
registration with or notice to, any New York State or federal banking
authority is required for the execution, delivery or performance by the
Property Trustee of this Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust and
the Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee is duly organized, validly existing
and in good standing under the laws of the State of Delaware or the United
States, with trust power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee. This Declaration has
been duly executed and delivered by the Delaware Trustee and constitutes a
legal, valid and binding obligation of the Delaware Trustee, enforceable
against it in accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws affecting
creditors' rights generally and to general principles of equity and the
discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law);
(c) No consent, approval or authorization of, or
registration with or notice to, any federal banking authority is required for
the execution, delivery or performance by the Delaware Trustee of this
Declaration; and
(d) The Delaware Trustee is a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity
which has its principal place of business in the State of Delaware.
61
<PAGE>
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, overnight courier service or
confirmed telecopy, as follows:
(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other
address as the Trust may give notice of to the Property Trustee, the Delaware
Trustee and the Holders):
Independent Capital Trust I
c/o The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Richard J. Seaman
Administrative Trustee
Telecopy: (212) 815-5917
(b) if given to the Delaware Trustee, at the mailing address
set forth below (or such other address as Delaware Trustee may give notice of
to the Holders):
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
Attention: Corporate Trust Department
Telecopy: (212) 815-5917
(c) if given to the Property Trustee, at the Property
Trustee's mailing address set forth below (or such other address as the
Property Trustee may give notice of to the Holders):
The Bank of New York
101 Barclay Street
21st Floor West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopy: (212) 815-5917
62
<PAGE>
(d) if given to the Holder of the Common Securities, at the
mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Property Trustee and
the Trust):
Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Attention: Richard J. Seaman
Chief Financial Officer
Telecopy: (617) 982-6130
(e) if given to any other Holder, at the address set forth
on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other document is
refused delivery or cannot be delivered because of a changed address of which
no notice was given, such notice or other document shall be deemed to have
been delivered on the date of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust.
The provisions of this Declaration shall be interpreted to further this
intention of the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 14.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be
deemed to be included, and
63
<PAGE>
all covenants and agreements in this Declaration by the Sponsor and the
Trustees shall bind and inure to the benefit of their respective successors
and assigns, whether so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to
persons or circumstances other than those to which it is held invalid, shall
not be affected thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed
a single signature page.
64
<PAGE>
IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
-------------------------------------------------
Douglas H. Philipsen, as Administrative Trustee
-------------------------------------------------
Richard J. Seaman, as Administrative Trustee
-------------------------------------------------
Russell N. Viau, as Administrative Trustee
THE BANK OF NEW YORK (DELAWARE)
as Delaware Trustee
By:
----------------------------------------------
Name:
Title:
THE BANK OF NEW YORK
as Property Trustee
By:
----------------------------------------------
Name:
Title:
INDEPENDENT BANK CORP.
as Sponsor and Debenture Issuer
By:
----------------------------------------------
Name: Richard J. Seaman
Title: Chief Financial Officer
65
<PAGE>
ANNEX I
TERMS OF
_____% CUMULATIVE TRUST PREFERRED SECURITIES
_____% COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of May __, 1997 (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Securities are set out
below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration, as defined
in the Prospectus referred to below in Section 2(c) of this Annex I):
1. Designation and Number.
(a) Preferred Securities. 1,000,000 ___% Cumulative Trust Preferred
Securities of the Trust with an aggregate liquidation amount with respect to
the assets of the Trust of twenty-five million dollars ($25,000,000), which
may be increased to an aggregate of 1,150,000 ___% Cumulative Trust Preferred
Securities of the Trust with an aggregate liquidation amount with respect to
the assets of the Trust of twenty-eight million, seven hundred and fifty
thousand dollars ($28,750,000) if an overallotment option granted to the
Underwriters of the Securities pursuant to an Underwriting Agreement with the
Sponsor and the Trust, each as described in the Prospectus referred to below
in Section 2(c) of this Annex I, is exercised in full, and each with a
liquidation amount with respect to the assets of the Trust of $25 per
security, are hereby designated for the purposes of identification only as
Preferred Securities. The certificates evidencing the Preferred Securities
shall be substantially in the form of Exhibit A-1 to the Declaration, with
such changes and additions thereto or deletions therefrom as may be required
by ordinary usage, custom or practice or to conform to the rules of any
exchange or quotation system on or in which the Preferred Securities are
listed, traded or quoted.
(b) Common Securities. 30,960 Common Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of seven
hundred seventy-four thousand dollars ($774,000), which may be increased to
an aggregate of 35,604 Common Securities of the Trust with an aggregate
liquidation amount with respect to the assets of the Trust of eight hundred,
ninety thousand, one hundred dollars ($890,100) if an overallotment option
granted to the Underwriters of the Securities pursuant to an Underwriting
Agreement with the Sponsor and the Trust, each as described in the Prospectus
referred to below in Section 2(c) of this Annex I, is exercised in full,and a
liquidation amount with respect to the assets of the Trust of $25 per
security, are hereby designated for the purposes of identification only as
Common Securities.
I-1
<PAGE>
The certificates evidencing the Common Securities shall be substantially in
the form of Exhibit A-2 to the Declaration, with such changes and additions
thereto or deletions therefrom as may be required by ordinary usage, custom
or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at a rate per
annum of _____% (the "Coupon Rate") of the liquidation amount of $25 per
Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions
in arrears for more than one quarterly period will bear additional
distributions thereon compounded quarterly at the Coupon Rate (to the extent
permitted by applicable law). A Distribution is payable only to the extent
that payments are made in respect of the Debentures held by the Property
Trustee and to the extent the Property Trustee has funds on hand legally
available therefor.
(b) Distributions on the Securities will be cumulative, will accumulate
from the most recent date to which Distributions have been paid or duly
provided for or, if no Distributions have been paid or duly provided for,
from May __, 1997, and will be payable quarterly in arrears on the ___ day of
March, June, September and December of each year, commencing on ________ ___,
1997 (each, a "Distribution Date"), except as otherwise described below.
Distributions will be computed on the basis of a 360-day year consisting of
twelve 30-day months and for any period less than a full calendar month on
the basis of the actual number of days elapsed in such month. As long as no
Event of Default has occurred and is continuing under the Indenture, the
Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time
to time on the Debentures for a period not exceeding 20 consecutive quarterly
periods, including the first such quarterly period during such period (each
an "Extension Period"), during which Extension Period no interest shall be
due and payable on the Debentures, provided that no Extension Period shall
end on a date other than an Interest Payment Date for the Debentures or
extend beyond the Maturity Date of the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Despite such deferral,
Distributions will continue to accumulate with additional Distributions
thereon (to the extent permitted by applicable law but not at a rate greater
than the rate at which interest is then accruing on the Debentures) at the
Coupon Rate compounded quarterly during any such Extension Period. Prior to
the termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all such previous
and further extensions within such Extension Period, may not exceed 20
consecutive quarterly periods, including the first quarterly period during
such Extension Period, or extend beyond the Maturity Date of the Debentures.
Upon the termination of any Extension Period and the payment of all amounts
then due, the Debenture Issuer may commence a new Extension Period, subject
to the above requirements.
I-2
<PAGE>
(c) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the close of
business on the
[first day of the month/15th day of the month preceding the month] in which
the relevant Distribution Date occurs, which Distribution Dates correspond to
the interest payment dates on the Debentures. Subject to any applicable laws
and regulations and the provisions of the Declaration, each such payment in
respect of the Global Preferred Securities will be made as described under
the heading "Description of Trust Preferred Securities --Global Trust
Preferred Securities" and "Book-Entry Issuance" in the Prospectus dated May
__, 1997, of the Debenture Issuer and the Trust relating to the Securities
and the Debentures. Payments in respect of Preferred Securities held in
certificated form will be made by check mailed to the Holder entitled
thereto. The relevant record dates for the Common Securities shall be the
same as the record dates for the Preferred Securities. Distributions payable
on any Securities that are not punctually paid on any Distribution Date, as a
result of the Debenture Issuer having failed to make a payment under the
Debentures, will cease to be payable to the Holder on the relevant record
date, and such defaulted Distribution will instead be payable to the Person
in whose name such Securities are registered on the special record date or
other specified date determined in accordance with the Indenture. If any
date on which Distributions are payable on the Securities is not a Business
Day, then payment of the Distribution payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), except that if such next
succeeding Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day with the same force
and effect as if made on such date.
(d) In the event that there is any money or other property held by or
for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders.
3. Liquidation Distribution Upon Dissolution.
In the event of any termination of the Trust or the Sponsor otherwise
gives notice of its election to liquidate the Trust pursuant to Section
8.1(a)(iii) of the Declaration, the Trust shall be liquidated by the
Administrative Trustees as expeditiously as the Administrative Trustees
determine to be possible by distributing, after satisfaction of liabilities
to creditors of the Trust as provided by applicable law, to the Holders a
Like Amount (as defined below) of the Debentures, unless such distribution is
determined by the Property Trustee not to be practicable, in which event such
Holders will be entitled to receive Pro Rata out of the assets of the Trust
legally available for distribution to Holders, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, an
amount equal to the aggregate of the liquidation amount of $25 per Security
plus accumulated and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution").
I-3
<PAGE>
"Like Amount" means (i) with respect to a redemption of the Securities,
Securities having a Liquidation Amount equal to the that portion of principal
amount of Debentures to be contemporaneously redeemed in accordance with
their terms and (ii) with respect to a distribution of Debentures upon the
dissolution or liquidation of the Trust, Debentures having a principal amount
equal to the Liquidation Amount of the Securities of the Holder to whom such
Debentures are distributed.
If, upon any such liquidation, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets on hand legally
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Securities shall be paid on a
Pro Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part, at
maturity or upon early redemption (either at the option of the Debenture
Issuer or pursuant to a Special Event, as described below), the proceeds from
such repayment shall be simultaneously applied by the Property Trustee
(subject to the Property Trustee having received written notice no later than
45 days prior to such repayment) to redeem a Like Amount of the Securities at
a redemption price equal to the accrued and unpaid interest on the Securities
to be so redeemed to the date fixed for redemption, plus 100% of the
principal amount thereof (the "Redemption Price").
(b) In the case of an optional redemption, if fewer than all the
outstanding Securities are to be so redeemed, the Securities to be redeemed
will be determined as described in Section 4(f)(ii) below.
The Debenture Issuer shall have the right (subject to the conditions in
the Indenture) to elect to redeem the Debentures in whole or in part at any
time on or after ___________, 2002, upon not less than 30 days and not more
than 60 days notice, at the Redemption Price and, simultaneous with such
redemption, to cause a Like Amount of the Securities to be redeemed by the
Trust at the Redemption Price on a Pro Rata basis.
(c) If at any time an Investment Company Event, a Tax Event or a
Regulatory Capital Event (each as defined below, and each a "Special Event")
occurs, the Debenture Issuer shall have the right (subject to the conditions
set forth in the Indenture) upon not less than 30 nor more than 60 days
notice, to redeem the Debentures in whole, but not in part, within the 90
days following the occurrence of such Special Event (the "90 Day Period"),
and, simultaneous with such redemption, to cause a Like Amount of the
Securities to be redeemed by the Trust at the Redemption Price on a Pro Rata
basis.
I-4
<PAGE>
"Investment Company Event" means the receipt by the Sponsor of an
Opinion of Counsel, rendered by a law firm experienced in such matters, to
the effect that, as a result of change in law or regulation or a change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority, the Trust is or will be
considered an "investment company" that is required to be registered under
the 1940 Act, which change becomes effective on or after the date of original
issuance of the Preferred Securities of Independent Capital Trust.
"Tax Event" shall occur upon receipt by the Sponsor and the Trust of an
Opinion of Counsel from counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws or any regulations thereunder of the United
States or any political subdivision or taxing authority thereof or therein,
or as a result of any official administrative pronouncement or judicial
decision interpreting or applying such laws or regulations, which amendment
or change is effective or which pronouncement or decision is announced on or
after May __, 1997, there is more than an insubstantial risk that (i) the
Trust is, or will be within 90 days of the date of such opinion, subject to
United States federal income tax with respect to income received or accrued
on the Debentures, (ii) interest payable by the Debenture Issuer on the
Debentures is not, or within 90 days of the date of such opinion, will not
be, deductible by the Debenture Issuer, in whole or in part, for United
States federal income tax purposes, or (iii) the Trust is, or will be within
90 days of the date of such opinion, subject to more than a de minimis amount
of other taxes, duties or other governmental charges.
A "Regulatory Capital Event" shall occur at any time that the Sponsor
shall have received an opinion of independent bank regulatory counsel
experienced in such matters to the effect that, as a result of (a) any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any rules,
guidelines or policies of the Federal Reserve Board or (b) any official
administrative pronouncement or judicial decision interpreting or applying
such laws or regulations, which amendment or change is effective or such
pronouncement or decision is announced on or after May __, 1997, the
Preferred Securities do not constitute, or within 90 days of the date
thereof, will not constitute, Tier I Capital (or its then equivalent);
provided, however, that the distribution of the Junior Subordinated
Debentures in connection with a termination of the Trust by the Sponsor shall
not in and of itself constitute a Regulatory Capital Event.
(d) On and from the date fixed by the Administrative Trustees for any
distribution of Debentures and liquidation of the Trust: (i) the Securities
will no longer be deemed to be outstanding, (ii) the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee), as the Holder of
the Preferred Securities, will receive a registered global certificate or
certificates representing the Debentures to be delivered upon such
distribution and any certificates representing Securities not held by the
Clearing Agency or its nominee (or any successor Clearing Agency or its
nominee) will be
I-5
<PAGE>
deemed to represent beneficial interests in a Like Amount of Debentures until
such certificates are presented to the Debenture Issuer or its agent for
transfer or reissue.
(e) The Trust may not redeem fewer than all the outstanding Securities
unless all accumulated and unpaid Distributions have been paid on all
Securities for all quarterly Distribution periods terminating on or before
the date of redemption.
(f) The procedure with respect to redemptions or distributions of
Securities shall be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution
Notice") will be given by the Trust by mail to each Holder to be
redeemed or exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the case of a
redemption, will be the date fixed for redemption of the Debentures. For
purposes of the calculation of the date of redemption or exchange and
the dates on which notices are given pursuant to this Section 4(f)(i), a
Redemption/Distribution Notice shall be deemed to be given on the day
such notice is first mailed by first-class mail, postage prepaid, to
Holders. Each Redemption/Distribution Notice shall be addressed to the
Holders at the address of each such Holder appearing in the books and
records of the Trust. No defect in the Redemption/Distribution Notice
or in the mailing of either thereof with respect to any Holder shall
affect the validity of the redemption or exchange proceedings with
respect to any other Holder.
(ii) In the event that fewer than all the outstanding Securities
are to be redeemed, the particular Securities to be redeemed shall be
selected on a Pro Rata basis (based upon Liquidation Amounts) not more
than 60 days prior to the date fixed for redemption from the outstanding
Preferred Securities not previously called for redemption, provided,
however, that with respect to Holders that would be required to hold
less than 100 but more than zero Securities as a result of such pro rata
redemption, the Trust shall redeem Securities of each such Holder so
that after such redemption such Holder shall hold either 100 Securities
or such Holder no longer holds any Securities and shall use such method
(including, without limitation, by lot) as the Trust shall deem fair and
appropriate, provided, further, that any such proration may be made on
the basis of the aggregate Liquidation Amount of Securities held by each
Holder thereof and may be made by making such adjustments as the Trust
deems fair and appropriate in order that only Securities in
denominations of $25 or integral multiples thereof shall be redeemed. In
respect of Preferred Securities registered in the name of and held of
record by the Clearing Agency or its nominee (or any successor Clearing
Agency or its nominee) or any nominee, the distribution of the proceeds
of such redemption will be made to the Clearing Agency and disbursed by
such Clearing Agency in accordance with the procedures applied by such
agency or nominee.
I-6
<PAGE>
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, (which notice will be irrevocable), then
(A) with respect to Preferred Securities issued in book-entry form, by
12:00 noon, New York City time, on the redemption date, provided that
the Debenture Issuer has paid the Property Trustee a sufficient amount
of cash in connection with the related redemption or maturity of the
Debentures by 10:00 a.m., New York City time, on the maturity date or
the date of redemption, as the case requires, the Property Trustee will
deposit irrevocably with the Clearing Agency or its nominee (or
successor Clearing Agency or its nominee) funds sufficient to pay the
Redemption Price with respect to such Preferred Securities and will give
the Clearing Agency irrevocable instructions and authority to pay the
Redemption Price to the relevant Clearing Agency Participants, and (B)
with respect to Preferred Securities issued in certificated form and
Common Securities, provided that the Debenture Issuer has paid the
Property Trustee a sufficient amount of cash in connection with the
related redemption or maturity of the Debentures, the Property
Trusteewill pay the Redemption Price to the Holders by check mailed to
the address of the relevant Holder appearing on the books and records of
the Trust on the redemption date. If a Redemption/Distribution Notice
shall have been given and funds deposited as required, if applicable,
then immediately prior to the close of business on the date of such
deposit, or on the redemption date, as applicable, Distributions will
cease to accumulate on the Securities so called for redemption and all
rights of Holders so called for redemption will cease, except the right
of the Holders of such Securities to receive the Redemption Price, but
without interest on such Redemption Price, and such Securities shall
cease to be outstanding.
(iv) Payment of accumulated and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of
Holders on the close of business on a regular record date in respect of
a Distribution Date occurring on or prior to such Redemption Date.
Neither the Administrative Trustees nor the Trust shall be required
to register or cause to be registered the transfer of (i) any Securities
beginning on the opening of business 15 days before the day of mailing
of a notice of redemption and ending at the close of business on the day
of such mailing or (ii) any Securities selected for redemption except
the unredeemed portion of any Security being redeemed. If any date
fixed for redemption of Securities is not a Business Day, then payment
of the Redemption Price payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such next
succeeding Business Day falls in the next calendar year, such payment
shall be made on the immediately preceding Business Day, with the same
force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the Property
Trustee or by the Sponsor as guarantor pursuant to the relevant Securi-
I-7
<PAGE>
ties Guarantee, Distributions on such Securities will continue to
accumulate from the original redemption date to the actual date of
payment, in which case the actual payment date will be considered the
date fixed for redemption for purposes of calculating the Redemption
Price.
(v) Redemption/Distribution Notices shall be sent by the Property
Trustee on behalf of the Trust to (A) in respect of the Preferred
Securities, the Clearing Agency or its nominee (or any successor
Clearing Agency or its nominee) if the Global Certificates have been
issued or, if Definitive Preferred Security Certificates have been
issued, to the Holder thereof, and (B) in respect of the Common
Securities to the Holder thereof.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws and banking
laws), provided the acquiror is not the Holder of the Common Securities
or the obligor under the Indenture, the Sponsor or any of its
subsidiaries may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or by private
agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b), 6(b) and 7 and as otherwise
required by law and the Declaration, the Holders of the Preferred Securities
will have no voting rights.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing
any trust or power conferred on such Debenture Trustee with respect to the
Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration
of acceleration of the maturity of the principal of the Debentures or (iv)
consent to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a majority in liquidation
amount of all outstanding Preferred Securities; provided, however, that where
a consent under the Indenture would require the consent of each holder of
Debentures affected thereby, no such consent shall be given by the Property
Trustee without the prior approval of each Holder of the Preferred
Securities. The Trustees shall not revoke any action previously authorized
or approved by a vote of the Holders of the Preferred Securities except by
subsequent vote of such Holders. Subject to Section 2.7 of the Declaration,
the Property Trustee shall notify each Holder of Preferred Securities of any
notice of default with respect to the Debentures. In addition to obtaining
the foregoing approvals of such Holders of the Preferred Securities, prior to
taking any of the foregoing actions, the Trustees shall obtain an opinion of
counsel experienced in such matters to the effect that
I-8
<PAGE>
the Trust will not be classified as an association taxable as a corporation
for United States federal income tax purposes on account of such action.
If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or interest on the Debentures on the due date (or
in the case of redemption, on the redemption date), then a Holder of
Preferred Securities may directly institute a proceeding for enforcement of
payment to such Holder of the principal of or interest on a Like Amount of
Debentures (a "Direct Action") on or after the respective due date specified
in the Debentures. In connection with such Direct Action, the rights of the
Common Securities Holder will be subrogated to the rights of such Holder of
Preferred Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Preferred Securities in such Direct Action. Except
as provided in the second preceding sentence, the Holders of Preferred
Securities will not be able to exercise directly any other remedy available
to the holders of the Debentures.
Any approval or direction of Holders of Preferred Securities may be
given at a separate meeting of Holders of Preferred Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust
or pursuant to written consent. The Administrative Trustees will cause a
notice of any meeting at which Holders of Preferred Securities are entitled
to vote, or of any matter upon which action by written consent of such
Holders is to be taken, to be mailed to each Holder of record of Preferred
Securities. Each such notice will include a statement setting forth (i) the
date of such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written
consent is sought and (iii) instructions for the delivery of proxies or
consents.
No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
I-9
<PAGE>
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and 7 as otherwise
required by law and the Declaration, the Holders of the Common Securities
will have no voting rights.
(b) Unless an Event of Default shall have occurred and be continuing,
any Trustee may be removed at any time by the holder of the Common
Securities. If an Event of Default has occurred and is continuing, the
Property Trustee and the Delaware Trustee may be removed at such time by the
holders of a Majority in liquidation amount of the outstanding Preferred
Securities. In no event will the holders of the Preferred Securities have the
right to vote to appoint, remove or replace, or increase or decrease the
number of, the Administrative Trustees, which voting rights are vested
exclusively in the Sponsor as the holder of the Common Securities. No
resignation or removal of a Trustee and no appointment of a successor trustee
shall be effective until the acceptance of appointment by the successor
trustee in accordance with the provisions of the Declaration.
(c) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing
any trust or power conferred on such Debenture Trustee with respect to the
Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration
of acceleration of the maturity of the principal of the Debentures or (iv)
consent to any amendment, modification or termination of the Indenture or the
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in liquidation
amount of all outstanding Common Securities; provided, however, that where a
consent under the Indenture would require the consent of each holder of
Debentures affected thereby, no such consent shall be given by the Property
Trustee without the prior approval of each Holder of the Common Securities.
The Trustees shall not revoke any action previously authorized or approved by
a vote of the Holders of the Common Securities except by subsequent vote of
such Holders. Subject to Section 2.7 of the Declaration, the Property Trustee
shall notify each Holder of Common Securities of any notice of default with
respect to the Debentures. In addition to obtaining the foregoing approvals
of such Holders of the Common Securities, prior to taking any of the
foregoing actions, the Trustees shall obtain an opinion of counsel
experienced in such matters to the effect that the Trust will not be
classified as an association taxable as a corporation for United States
federal income tax purposes on account of such action.
If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or interest on the Debentures on the due date (or
in the case of redemption, on the redemption date), then a Holder of Common
Securities may institute a Direct Action for
I-10
<PAGE>
enforcement of payment to such Holder of the principal of or interest on a
Like Amount of Debentures on or after the respective due date specified in
the Debentures. In connection with Direct Action, the rights of the Common
Securities Holder will be subordinated to the rights of such Holder of
Preferred Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Common Securities in such Direct Action. Except as
provided in the second preceding sentence, the Holders of Common Securities
will not be able to exercise directly any other remedy available to the
holders of the Debentures.
Any approval or direction of Holders of Common Securities may be given
at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice
of any meeting at which Holders of Common Securities are entitled to vote, or
of any matter upon which action by written consent of such Holders is to be
taken, to be mailed to each Holder of record of Common Securities. Each such
notice will include a statement setting forth (i) the date of such meeting or
the date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration and Indenture.
In addition to the requirements set out in Section 12.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor,
the Property Trustee and the Administrative Trustees, without the consent of
the Holders (i) to cure any ambiguity, correct or supplement any provisions
in the Declaration that may be inconsistent with any other provisions, or to
make any other provisions with respect to matters or questions arising under
the Declaration which shall not be inconsistent with the other provisions of
the Declaration or (ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust
will be classified for United States federal income tax purposes as a grantor
trust at all times that any Securities are outstanding or to ensure that the
Trust will not be required to register as an "Investment Company" under the
Investment Company Act provided, however, that in each case such action shall
not adversely affect in any material respect the interests of any Holder.
Any amendments of the Declaration shall become effective when notice thereof
is given to the Holders. Under the circumstances referred to in Section
12.1(c) of the Declaration, the Declaration also may be amended by the
Trustees and the Sponsor with (i) the consent of Holders representing a
Majority in liquidation amount of all outstanding Securities, and (ii)
receipt by the Trustees of an
I-11
<PAGE>
Opinion of Counsel to the effect that such amendment or the exercise of any
power granted to the Trustees in accordance with such amendment will not
affect the Trust's status as a grantor trust for United States federal income
tax purposes or the Trust's exemption from status as an Investment Company
under the Investment Company Act, provided that, without the consent of each
Holder of Trust Securities, the Declaration may not be amended to (i) change
the amount or timing of any Distribution on the Trust Securities or otherwise
adversely affect the amount of any Distribution required to be made in
respect of the Trust Securities as of a specified date or (ii) restrict the
right of a holder of Trust Securities to institute suit for the enforcement
of any such payment on or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each
Holder according to the aggregate liquidation amount of the Securities held
by the relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount
of Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities,
to each Holder of Common Securities pro rata according to the aggregate
liquidation amount of Common Securities held by the relevant Holder relative
to the aggregate liquidation amount of all Common Securities outstanding. In
any such proration, the Trust may make such adjustments as may be appropriate
in order that only securities in authorized denominations shall be redeemed
(subject to the minimum block requirements of Section 9.2(n) of the
Declaration).
9. Ranking.
The Preferred Securities rank pari passu with the Common Securities and
payment thereon shall be made Pro Rata with the Common Securities, except
that, if an Event of Default under the Declaration occurs and is continuing,
no payments in respect of Distributions on, or payments upon liquidation,
redemption or otherwise with respect to, the Common Securities shall be made
until the Holders of the Preferred Securities shall be paid in full the
Distributions, Redemption Price, Liquidation Distribution and other payments
to which they are entitled at such time.
10. Acceptance of Securities Guarantee and Indenture.
Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the
I-12
<PAGE>
Common Securities Guarantee, respectively, including the subordination
provisions therein and to the provisions of the Indenture.
11. No Preemptive Rights.
The Holders shall have no preemptive rights to subscribe for any
additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the Preferred
Securities Guarantee, the Common Securities Guarantee (as may be appropriate)
and the Indenture (including any supplemental indenture) to a Holder without
charge upon written request to the Sponsor at its principal place of business.
I-13
<PAGE>
EXHIBIT A-1
FORM OF ___% CUMULATIVE TRUST PREFERRED SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
Number of Aggregate Liquidation
Amount: _____________
Preferred Securities
_____________________ CUSIP NO. ___________
Certificate Evidencing ___% Cumulative Trust Preferred Securities
of
Independent Capital Trust I
_____% Cumulative Trust Preferred Securities
(liquidation amount $25 per Preferred Security)
Independent Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), hereby
certifies that ______________ (the "Holder") is the registered owner of
[$_________ in aggregate liquidation amount of Preferred Securities of the
Trust](1) [the aggregate liquidation amount of Preferred Securities of the Trust
specified in Schedule A hereto](2) representing undivided beneficial interests
in the assets of the Trust designated the _____% Cumulative Trust Preferred
Securities (liquidation amount $25 per Preferred Security) (the "Preferred
Securities"). Subject to the Declaration (as defined below), the Preferred
Securities are transferable on the books and records of the Trust, in person
or by a duly authorized attorney, upon surrender of this certificate duly
endorsed and in proper form for transfer. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Preferred Securities represented hereby are issued and shall in all respects
be subject to the provisions of the Amended and Restated Declaration of Trust
of the Trust dated as of May __, 1997, as the same may be amended from time
to time (the "Declaration"), including the designation of the terms of the
Preferred Securities as set forth in Annex I to the Declaration. Capitalized
terms used but not defined herein shall have the meaning given them in the
Declaration. The Sponsor will provide a copy of the
____________________
1 Insert in Definitive Preferred Securities only.
2 Insert in Global Preferred Securities only.
A1-1
<PAGE>
Declaration, the Preferred Securities Guarantee, the Common Securities
Guarantee (as may be appropriate), and the Indenture (including any
supplemental indenture) to a Holder without charge upon written request to
the Trust at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder and to the benefits of the
Preferred Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debentures.
A1-2
<PAGE>
IN WITNESS WHEREOF, the Trust has duly executed this certificate.
INDEPENDENT CAPITAL TRUST I
By:________________________________
Name: Richard J. Seaman
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Declaration.
THE BANK OF NEW YORK
as Property Trustee
Dated:
By:________________________________
Authorized Signatory
A1-3
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Preferred Security will be fixed at a rate
per annum of _____% (the "Coupon Rate") of the liquidation amount of $25 per
Preferred Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for
more than one quarterly period will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). A
Distribution is payable only to the extent that payments are made in respect
of the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds on hand legally available therefor.
Distributions on the Preferred Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or
duly provided for, if no Distributions have been paid or duly provided for,
from May __, 1997 and will be payable quarterly in arrears, on the ___ day of
March, July, September and December of each year, commencing on __________,
1997, except as otherwise described below. Distributions will be computed on
the basis of a 360-day year consisting of twelve 30-day months and, for any
period less than a full calendar month, the number of days elapsed in such
month. As long as no Event of Default has occurred and is continuing under
the Indenture, the Debenture Issuer has the right under the Indenture to
defer payments of interest by extending the interest payment period at any
time and from time to time on the Debentures for a period not exceeding 20
consecutive calendar quarterly periods, including the first such quarterly
period during such extension period (each an "Extension Period"), provided
that no Extension Period shall end on a date other than an Interest Payment
Date for the Debentures or extend beyond the Maturity Date of the Debentures.
As a consequence of such deferral, Distributions also will be deferred.
Despite such deferral, quarterly Distributions will continue to accumulate
with interest thereon (to the extent permitted by applicable law, but not at
a rate exceeding the rate of interest then accruing on the Debentures) at the
Coupon Rate compounded quarterly during any such Extension Period. Prior to
the termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all such previous
and further extensions within such Extension Period, may not exceed 20
consecutive quarterly periods, including the first quarterly period during
such Extension Period, end on a date other than an Interest Payment Date for
the Debentures or extend beyond the Maturity Date of the Debentures.
Payments of accumulated Distributions will be payable to Holders as they
appear on the books and records of the Trust on the first record date after
the end of the Extension Period. Upon the termination of any Extension
Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
Subject to the receipt of any required regulatory approval and to
certain other conditions set forth in the Declaration and the Indenture, the
Property Trustee may, at the direction of the Sponsor, at any time liquidate
the Trust and cause the
A1-4
<PAGE>
Debentures to be distributed to the holders of the Securities in liquidation
of the Trust or, simultaneous with any redemption of the Debentures, cause a
Like Amount of the Securities to be redeemed by the Trust.
The Preferred Securities shall be redeemable as provided in the
Declaration.
A1-5
<PAGE>
_____________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
_______________________________________________________________________________
_______________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
_______________________________________________________________________________
_______________________________________________________________________________
___________________________________________________________ agent to transfer
this Preferred Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: _______________________
Signature:
____________________________________________________________
(Sign exactly as your name appears on the other side of this
Preferred Security Certificate)
Signature Guarantee***: ___________________________________
____________________
*** Signature must be guaranteed by an "eligible guarantor institution"
that is a bank, stockbroker, savings and loan association or credit
union meeting the requirements of the Registrar, which requirements
include membership or participation in the Securities Transfer Agents
Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities and
Exchange Act of 1934, as amended.
A1-6
<PAGE>
Schedule A ***
The initial number of Preferred Securities evidenced by the Certificate to
which this Schedule is attached is _______ (having an aggregate liquidation
amount of $______). The notations in the following table evidence decreases and
increases in the number of Preferred Securities evidenced by such Certificate.
Number of Preferred
Decrease in Num- Increase in Num- Securities Remaining
ber of Preferred ber of Preferred after such Decrease Notation by
Securities Securities or Increase Registrar
- ---------------- ---------------- -------------------- -----------
* Append to Global Preferred Securities only.
A1-7
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, REGISTRATION.
THE HOLDER OF THIS COMMON SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS COMMON SECURITY, PRIOR TO THE DATE
(THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH
INDEPENDENT BANK CORP. (THE "COMPANY") OR ANY "AFFILIATE" OF THE COMPANY WAS
THE OWNER OF THIS Preferred SECURITY (OR ANY PREDECESSOR OF THIS Preferred
SECURITY) ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS
THIS COMMON SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS
ACQUIRING THIS COMMON SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT,
SUBJECT TO THE RIGHT OF THE TRUST AND THE COMPANY PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY
TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D), TO REQUIRE THAT A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE REVERSE OF THIS COMMON
SECURITY IS
A2-1
<PAGE>
COMPLETED AND DELIVERED BY THE TRANSFEREE TO THE TRUST. SUCH HOLDER FURTHER
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS COMMON SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
THIS COMMON SECURITY IS NOT TRANSFERABLE EXCEPT AS SET FORTH IN SECTION
9.1(c) OF THE AMENDED AND RESTATED DECLARATION OF TRUST OF THE INDEPENDENT
CAPITAL TRUST I, DATED AS OF MAY __, 1997, AS THE SAME MAY BE AMENDED FROM
TIME TO TIME.
A2-2
<PAGE>
Certificate Evidencing Common Securities
of
Independent Capital Trust I
_____% Common Securities
(liquidation amount $25 per Common Security)
Independent Capital Trust I, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that
______________________ (the "Holder") is the registered owner of __________
common securities of the Trust representing undivided beneficial interests in
the assets of the Trust designated the _____% Common Securities (liquidation
amount $25 per Common Security) (the "Common Securities"). Subject to the
limitations in Section 9.1(c) of the Declaration (as defined below), the
Common Securities are transferable on the books and records of the Trust, in
person or by a duly authorized attorney, upon surrender of this certificate
duly endorsed and in proper form for transfer. The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of May __, 1997, as the same may be amended from time to
time (the "Declaration"), including the designation of the terms of the
Common Securities as set forth in Annex I to the Declaration. Preferredized
terms used but not defined herein shall have the meaning given them in the
Declaration. The Sponsor will provide a copy of the Declaration, the Common
Securities Guarantee, the Preferred Securities Guarantee (as may be
appropriate) and the Indenture (including any supplemental indenture) to a
Holder without charge upon written request to the Sponsor at its principal
place of business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities
as evidence of indirect beneficial ownership in the Debentures.
A2-3
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this ___ day
of May, 1997.
Independent Capital Trust I
By: ________________________________
Name: Richard J. Seaman
Administrative Trustee
A2-4
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at a rate
per annum of _____% (the "Coupon Rate") of the liquidation amount of $25 per
Common Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for
more than one quarterly period will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). A
Distribution is payable only to the extent that payments are made in respect
of the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds available therefor.
Distributions on the Common Securities will be cumulative, will accrue
from the most recent date to which Distributions have been paid or duly
provided for or, if no Distributions have been paid or duly provided for,
from May __, 1997 and will be payable quarterly in arrears, on the ___ day of
March, July, September and December of each year, commencing on ________,
1997, except as otherwise described below. Distributions will be computed on
the basis of a 360-day year consisting of twelve 30-day months and, for any
period less than a full calendar month, the number of days elapsed in such
month. As long as no Event of Default has occurred and is continuing under
the Indenture, the Debenture Issuer has the right under the Indenture to
defer payments of interest by extending the interest payment period at any
time and from time to time on the Debentures for a period not exceeding 20
consecutive calendar quarterly periods, including the first such quarterly
period during such extension period (each an "Extension Period"), provided
that no Extension Period shall end on a date other than an Interest Payment
Date for the Debentures or extend beyond the Maturity Date of the Debentures.
As a consequence of such deferral, Distributions also will be deferred.
Despite such deferral, Distributions will continue to accumulate with
interest thereon (to the extent permitted by applicable law, but not at a
rate exceeding the rate of interest then accruing on the Debentures) at the
Coupon Rate compounded quarterly during any such Extension Period. Prior to
the termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all such previous
and further extensions within such Extension Period, may not exceed 20
consecutive quarterly periods, including the first quarterly period during
such Extension Period, or end on a date other than an Interest Payment Date
for the Debentures or extend beyond the Maturity Date of the Debentures.
Payments of accrued Distributions will be payable to Holders as they appear
on the books and records of the Trust on the first record date after the end
of the Extension Period. Upon the termination of any Extension Period and the
payment of all amounts then due, the Debenture Issuer may commence a new
Extension Period, subject to the above requirements.
Subject to the receipt of any required regulatory approval and to
certain other conditions set forth in the Declaration and the Indenture, the
Property Trustee may, at the direction of the Sponsor, at any time liquidate
the Trust and cause the
A2-5
<PAGE>
Debentures to be distributed to the holders to the Securities in liquidation
of the Trust or, simultaneous with any redemption of the Debentures, cause a
Like Amount of the Securities to be redeemed by the Trust.
Under certain circumstances, the right of the holders of the Common
Securities shall be subordinate to the rights of the holders of the Preferred
Securities (as defined in the Declaration), as provided in the Declaration.
The Common Securities shall be redeemable as provided in the Declaration.
A2-6
<PAGE>
_____________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security Certificate to:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Insert assignee's social security or tax identification number)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
______________________________________________________________________________
______________________________________________________________________________
___________________________________________________________ agent to transfer
this Common Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: _______________________
Signature: ___________________________________________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
A2-7
<PAGE>
EXHIBIT 4.6
====================================
TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
Independent Bank Corp.
Dated as of May __, 1997
====================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation........................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application......................... 5
SECTION 2.2 Lists of Holders of Securities........................... 6
SECTION 2.3 Reports by the Trust Preferred Securities Guarantee
Trustee.................................................. 6
SECTION 2.4 Periodic Reports to Trust Preferred Securities
Guarantee Trustee........................................ 6
SECTION 2.5 Evidence of Compliance with Conditions Precedent......... 6
SECTION 2.6 Events of Default; Waiver................................ 7
SECTION 2.7 Event of Default; Notice................................. 7
SECTION 2.8 Conflicting Interests.................................... 7
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Trust Preferred Securities
Guarantee Trustee........................................ 8
SECTION 3.2 Certain Rights of Trust Preferred Securities Guarantee
Trustee................................................. 10
SECTION 3.3. Not Responsible for Recitals or Issuance of Trust
Preferred Securities Guarantee........................... 12
ARTICLE IV
TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Trust Preferred Securities Guarantee Trustee;
Eligibility.............................................. 12
SECTION 4.2 Appointment, Removal and Resignation of Trust Preferred
Securities Guarantee Trustee............................. 13
<PAGE>
Page
----
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee................................................ 14
SECTION 5.2 Waiver of Notice and Demand.............................. 14
SECTION 5.3 Obligations Not Affected................................. 14
SECTION 5.4 Rights of Holders........................................ 15
SECTION 5.5 Guarantee of Payment..................................... 15
SECTION 5.6 Subrogation.............................................. 15
SECTION 5.7 Independent Obligations.................................. 16
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions............................... 16
SECTION 6.2 Ranking.................................................. 17
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.............................................. 17
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation.............................................. 17
SECTION 8.2 Indemnification.......................................... 18
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns................................... 18
SECTION 9.2 Amendments............................................... 18
SECTION 9.3 Notices.................................................. 19
SECTION 9.4 Benefit.................................................. 20
SECTION 9.5 Governing Law............................................ 20
ii
<PAGE>
TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Trust Preferred Securities Guarantee"),
dated as of May __, 1997, is executed and delivered by Independent Bank Corp., a
Massachusetts corporation (the "Guarantor"), and The Bank of New York, a New
York banking corporation, as trustee (the "Trust Preferred Securities Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Trust Preferred Securities (as defined herein) of Independent Capital
Trust I, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust (the
"Declaration"), dated as of May __, 1997, among the trustees of the Issuer, the
Guarantor, as sponsor, and the holders from time to time of undivided beneficial
interests in the assets of the Issuer, the Issuer is issuing on the date hereof
1,000,000 trust preferred securities, having an aggregate liquidation amount of
$25,000,000, such trust preferred securities being designated the _____% Trust
Preferred Securities (collectively the "Trust Preferred Securities"), which may
be increased to 1,150,000 Trust Preferred Securities having an aggregate
liquidation amount of $28,750,000 if an overallotment option granted to the
underwriters pursuant to the Underwriting Agreement for the public offering of
the Trust Preferred Securities is exercised in full; and
WHEREAS, as incentive for the Holders to purchase the Trust Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Trust Preferred Securities Guarantee, to pay to the
Holders the Guarantee Payments (as defined below) and to make certain other
payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is executing and delivering a guarantee
agreement (the "Common Securities Guarantee"), with substantially identical
terms to this Trust Preferred Securities Guarantee, for the benefit of the
holders of the Common Securities (as defined herein), except that if an Event of
Default (as defined in the Declaration) has occurred and is continuing, the
rights of holders of the Common Securities to receive Guarantee Payments under
the Common Securities Guarantee are subordinated, to the extent and in the
manner set forth in the Common Securities Guarantee, to the rights of holders of
Trust Preferred Securities to receive Guarantee Payments under this Trust
Preferred Securities Guarantee;
NOW, THEREFORE, in consideration of the purchase by each Holder, which
purchase the Guarantor hereby acknowledges shall benefit the Guarantor, the
Guarantor executes and delivers this Trust Preferred Securities Guarantee for
the benefit of the Holders.
<PAGE>
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1 Definitions and Interpretation
In this Trust Preferred Securities Guarantee, unless the context
otherwise requires:
(a) Capitalized terms used in this Trust Preferred Securities
Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;
(b) Terms defined in the Declaration as at the date of execution of
this Trust Preferred Securities Guarantee have the same meaning
when used in this Trust Preferred Securities Guarantee unless
otherwise defined in this Trust Preferred Securities Guarantee;
(c) a term defined anywhere in this Trust Preferred Securities
Guarantee has the same meaning throughout;
(d) all references to "the Trust Preferred Securities Guarantee" or
"this Trust Preferred Securities Guarantee" are to this Trust
Preferred Securities Guarantee as modified, supplemented or
amended from time to time;
(e) all references in this Trust Preferred Securities Guarantee to
Articles and Sections are to Articles and Sections of this Trust
Preferred Securities Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same meaning
when used in this Trust Preferred Securities Guarantee, unless
otherwise defined in this Trust Preferred Securities Guarantee or
unless the context otherwise requires; and
(g) a reference to the singular includes the plural and vice versa.
"Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" means any day other than a Saturday or a Sunday, or a
day on which banking institutions in The City of New York or Rockland,
Massachusetts are authorized or required by law or executive order to close.
"Trust Preferred Securities Guarantee Trustee" means The Bank of New
York, a New York banking corporation, until a Successor Trust Preferred
Securities Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Trust
2
<PAGE>
Preferred Securities Guarantee and thereafter means each such Successor Trust
Preferred Securities Guarantee Trustee.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Corporate Trust Office" means the office of the Trust Preferred
Securities Guarantee Trustee at which the corporate trust business of the Trust
Preferred Securities Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, New York, New York 10286.
"Covered Person" means any Holder of Trust Preferred Securities.
"Debentures" means the series of subordinated debt securities of the
Guarantor designated the _____% Junior Subordinated Deferrable Interest
Debentures due _____ __, 2027 held by the Property Trustee (as defined in the
Declaration) of the Issuer.
"Event of Default" means a default by the Guarantor on any of its
payment or other obligations under this Trust Preferred Securities Guarantee,
provided, however, that except with respect to a default in payment of any
Guarantee Payment, the Guarantor shall have received notice of default and shall
not have cured such default within 60 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Trust Preferred Securities, to the
extent not paid or made by the Issuer: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Trust Preferred Securities to the extent the Issuer has funds on hand
legally available therefor at such time, (ii) the redemption price, including
all accumulated and unpaid Distributions to the date of redemption (the
"Redemption Price") to the extent the Issuer has funds on hand legally available
therefor at such time, with respect to any Trust Preferred Securities called for
redemption by the Issuer and (iii) upon a voluntary or involuntary termination
and liquidation of the Issuer (other than in connection with the distribution of
Debentures to the Holders in exchange for Trust Preferred Securities as provided
in the Declaration), the lesser of (a) the aggregate of the liquidation amount
and all accumulated and unpaid Distributions on the Trust Preferred Securities
to the date of payment, to the extent the Issuer has funds on hand legally
available therefor, and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in liquidation of the Issuer. If an Event
of Default has occurred and is continuing, no Guarantee Payments under the
Common Securities Guarantee with respect to the Common Securities or any
guarantee payment under any Other Common Securities Guarantees shall be made
until the Holders shall be paid in full the Guarantee Payments to which they are
entitled under this Trust Preferred Securities Guarantee.
"Holder" shall mean any holder, as registered on the books and records
of the Issuer, of any Trust Preferred Securities; provided, however, that, in
determining whether the
3
<PAGE>
holders of the requisite percentage of Trust Preferred Securities have given
any request, notice, consent or waiver hereunder, "Holder" shall not include
the Guarantor or any Person known to a Responsible Officer of the Trust
Preferred Securities Guarantee Trustee to be an Affiliate of the Guarantor.
"Indemnified Person" means the Trust Preferred Securities Guarantee
Trustee, any Affiliate of the Trust Preferred Securities Guarantee Trustee, or
any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Trust Preferred
Securities Guarantee Trustee.
"Indenture" means the Indenture dated as of May __, 1997, among the
Guarantor (the "Debenture Issuer") and The Bank of New York, as trustee (the
"Indenture Trustee"), pursuant to which the Debentures are to be issued to the
Property Trustee of the Issuer.
"Indenture Event of Default" shall mean any event specified in Section
5.01 of the Indenture.
"Majority in liquidation amount of the Trust Preferred Securities"
means, except as provided by the Declaration or by the Trust Indenture Act, a
vote by Holder(s) of more than 50% of the aggregate liquidation amount of all
Trust Preferred Securities.
"Officers' Certificate" means, with respect to the Guarantor, a
certificate signed by any of the Chairman, a Vice Chairman, the Chief Executive
Officer, the President, a Vice President, the Comptroller, the Clerk or an
Assistant Clerk of the Guarantor. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this Trust
Preferred Securities Guarantee (other than pursuant to Section 314(d)(4) of the
Trust Indenture Act) shall include:
(a) a statement that each officer signing the Officers' Certificate
has read the covenant or condition and the definitions relating thereto;
(b) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(c) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Other Common Securities Guarantees" shall have the same meaning as
"Other Guarantees" as defined in the Common Securities Guarantee.
4
<PAGE>
"Other Debentures" means all junior subordinated debentures issued by
the Guarantor from time to time and sold to trusts to be established by the
Guarantor (if any), in each case similar to the Issuer.
"Other Guarantees" means all guarantees to be issued by the Guarantor
with respect to trust preferred securities (if any) similar to the Trust
Preferred Securities issued by other trusts to be established by the Guarantor
(if any), in each case similar to the Issuer.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the Trust Preferred
Securities Guarantee Trustee, any officer within the Corporate Trust Office of
the Trust Preferred Securities Guarantee Trustee with direct responsibility for
the administration of this Trust Preferred Securities Guarantee and also means,
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of that officer's knowledge of and familiarity
with the particular subject.
"Successor Trust Preferred Securities Guarantee Trustee" means a
successor Trust Preferred Securities Guarantee Trustee possessing the
qualifications to act as Trust Preferred Securities Guarantee Trustee under
Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Trust Securities" means the Common Securities and the Trust Preferred
Securities, collectively.
ARTICLE II
TRUST INDENTURE ACT
SECTION 1 Trust Indenture Act; Application
(a) This Trust Preferred Securities Guarantee is subject to the
provisions of the Trust Indenture Act that are required to be part of this Trust
Preferred Securities Guarantee and shall, to the extent applicable, be governed
by such provisions; and
(b) if and to the extent that any provision of this Trust Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Section 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.
5
<PAGE>
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Trust Preferred Securities
Guarantee Trustee (unless the Trust Preferred Securities Guarantee Trustee is
otherwise the registrar of the Trust Preferred Securities) with a list, in such
form as the Trust Preferred Securities Guarantee Trustee may reasonably require,
of the names and addresses of the Holders ("List of Holders") as of such date,
(i) within one Business Day after January 15 and July 15 of each year, and (ii)
at any other time within 30 days of receipt by the Guarantor of a written
request for a List of Holders as of a date no more than 14 days before such List
of Holders is given to the Trust Preferred Securities Guarantee Trustee,
provided, that the Guarantor shall not be obligated to provide such List of
Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Trust Preferred Securities Guarantee Trustee by the
Guarantor. The Trust Preferred Securities Guarantee Trustee may destroy any
List of Holders previously given to it on receipt of a new List of Holders.
(b) The Trust Preferred Securities Guarantee Trustee shall comply
with its obligations under Sections 311(a), 311(b) and Section 312(b) of the
Trust Indenture Act.
SECTION 2.3 Reports by the Trust Preferred Securities Guarantee Trustee
Within 60 days after May 15 of each year, commencing May 15, 1998, the
Trust Preferred Securities Guarantee Trustee shall provide to the Holders such
reports as are required by Section 313 of the Trust Indenture Act, if any, in
the form and in the manner provided by Section 313 of the Trust Indenture Act.
The Trust Preferred Securities Guarantee Trustee shall also comply with the
other requirements of Section 313 of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Trust Preferred Securities Guarantee Trustee
The Guarantor shall provide to the Trust Preferred Securities
Guarantee Trustee such documents, reports and information as required by Section
314 (if any) and the compliance certificate required by Section 314 of the Trust
Indenture Act in the form, in the manner and at the times required by Section
314 of the Trust Indenture Act, provided that such compliance certificate shall
be delivered on or before 120 days after the end of each fiscal year of the
Guarantor. Delivery of such reports, information and documents to the Trust
Preferred Securities Guarantee Trustee is for informational purposes only and
the Trust Preferred Securities Guarantee Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Guarantor's
compliance with any of its covenants hereunder (as to which the Trust Preferred
Securities Guarantee Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Trust Preferred Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Trust
6
<PAGE>
Preferred Securities Guarantee that relate to any of the matters set forth in
Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of Trust Preferred
Securities may, by vote, on behalf of all Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Trust Preferred Securities Guarantee,
but no such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The Trust Preferred Securities Guarantee Trustee shall, within 90
days after the occurrence of a default with respect to this Trust Preferred
Securities Guarantee, mail by first class postage prepaid, to all Holders,
notices of all defaults actually known to a Responsible Officer, unless such
defaults have been cured before the giving of such notice, provided, that,
except in the case of default in the payment of any Guarantee Payment, the Trust
Preferred Securities Guarantee Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or a Responsible Officer in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Trust Preferred Securities Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Trust Preferred
Securities Guarantee Trustee shall have received written notice from the
Guarantor, or a Responsible Officer charged with the administration of this
Trust Preferred Securities Guarantee shall have obtained actual knowledge, of
such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described in this
Trust Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.
7
<PAGE>
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Trust Preferred Securities Guarantee
Trustee
(a) This Trust Preferred Securities Guarantee shall be held by the
Trust Preferred Securities Guarantee Trustee for the benefit of the Holders, and
the Trust Preferred Securities Guarantee Trustee shall not transfer this Trust
Preferred Securities Guarantee to any Person except a Holder exercising his or
her rights pursuant to Section 5.4(b) or to a Successor Trust Preferred
Securities Guarantee Trustee on acceptance by such Successor Trust Preferred
Securities Guarantee Trustee of its appointment to act as Successor Trust
Preferred Securities Guarantee Trustee. The right, title and interest of the
Trust Preferred Securities Guarantee Trustee shall automatically vest in any
Successor Trust Preferred Securities Guarantee Trustee, and such vesting and
succession of title shall be effective whether or not conveyancing documents
have been executed and delivered pursuant to the appointment of such Successor
Trust Preferred Securities Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer
has occurred and is continuing, the Trust Preferred Securities Guarantee Trustee
shall enforce this Trust Preferred Securities Guarantee for the benefit of the
Holders.
(c) The Trust Preferred Securities Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Trust Preferred Securities Guarantee, and no
implied covenants shall be read into this Trust Preferred Securities Guarantee
against the Trust Preferred Securities Guarantee Trustee. In case an Event of
Default has occurred (that has not been cured or waived pursuant to Section 2.6)
and is actually known to a Responsible Officer, the Trust Preferred Securities
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Trust Preferred Securities Guarantee, and use the same degree of care and
skill in its exercise thereof, as a prudent person would exercise or use under
the circumstances in the conduct of his or her own affairs.
(d) No provision of this Trust Preferred Securities Guarantee shall
be construed to relieve the Trust Preferred Securities Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Trust Preferred Securities
Guarantee Trustee shall be determined solely by the express provisions
of this Trust Preferred Securities Guarantee, and the Trust Preferred
Securities Guarantee Trustee shall not be liable except for the
performance of such duties
8
<PAGE>
and obligations as are specifically set forth in this Trust
Preferred Securities Guarantee, and no implied covenants or
obligations shall be read into this Trust Preferred Securities
Guarantee against the Trust Preferred Securities Guarantee Trustee;
and
(B) in the absence of bad faith on the part of the Trust
Preferred Securities Guarantee Trustee, the Trust Preferred Securities
Guarantee Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
any certificates or opinions furnished to the Trust Preferred
Securities Guarantee Trustee and conforming to the requirements of
this Trust Preferred Securities Guarantee; but in the case of any such
certificates or opinions that by any provision hereof are specifically
required to be furnished to the Trust Preferred Securities Guarantee
Trustee, the Trust Preferred Securities Guarantee Trustee shall be
under a duty to examine the same to determine whether or not they
conform to the requirements of this Trust Preferred Securities
Guarantee;
(ii) the Trust Preferred Securities Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the Trust Preferred Securities
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;
(iii) the Trust Preferred Securities Guarantee Trustee shall not
be liable with respect to any action taken or omitted to be taken by it in
good faith in accordance with the direction of the Holders of a Majority in
liquidation amount of the Trust Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to
the Trust Preferred Securities Guarantee Trustee, or exercising any trust
or power conferred upon the Trust Preferred Securities Guarantee Trustee
under this Trust Preferred Securities Guarantee; and
(iv) no provision of this Trust Preferred Securities Guarantee shall
require the Trust Preferred Securities Guarantee Trustee to expend or risk
its own funds or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of its rights or
powers, if the Trust Preferred Securities Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such funds or
liability is not reasonably assured to it under the terms of this Trust
Preferred Securities Guarantee or indemnity, reasonably satisfactory to the
Trust Preferred Securities Guarantee Trustee, against such risk or
liability is not reasonably assured to it.
9
<PAGE>
SECTION 3.2 Certain Rights of Trust Preferred Securities Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Trust Preferred Securities Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining from acting,
upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the Guarantor contemplated by this Trust
Preferred Securities Guarantee may be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Trust Preferred
Securities Guarantee, the Trust Preferred Securities Guarantee Trustee
shall deem it desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the Trust Preferred
Securities Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of such
request, shall be promptly delivered by the Guarantor.
(iv) The Trust Preferred Securities Guarantee Trustee shall have no
duty to see to any recording, filing or registration of any instrument (or
any rerecording, refiling or registration thereof).
(v) The Trust Preferred Securities Guarantee Trustee may consult with
counsel of its selection, and the advice or opinion of such counsel with
respect to legal matters shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion.
Such counsel may be counsel to the Guarantor or any of its Affiliates and
may include any of its employees. The Trust Preferred Securities Guarantee
Trustee shall have the right at any time to seek instructions concerning
the administration of this Trust Preferred Securities Guarantee from any
court of competent jurisdiction.
(vi) The Trust Preferred Securities Guarantee Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by this
Trust Preferred Securities Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the Trust Preferred
Securities Guarantee Trustee such security and indemnity, reasonably
satisfactory to the Trust Preferred Securities Guarantee Trustee, against
the costs, expenses (including attorneys' fees and expenses and the
expenses of the Trust Preferred Securities Guarantee Trustee's agents,
nominees or custodians) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable
advances as may be requested by the Trust Preferred Securities Guarantee
10
<PAGE>
Trustee; provided that, nothing contained in this Section 3.2(a)(vi) shall
be taken to relieve the Trust Preferred Securities Guarantee Trustee, upon
the occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Trust Preferred Securities
Guarantee.
(vii) The Trust Preferred Securities Guarantee Trustee shall not be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but the Trust Preferred
Securities Guarantee Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit.
(viii) The Trust Preferred Securities Guarantee Trustee may execute
any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, nominees, custodians or attorneys,
and the Trust Preferred Securities Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder.
(ix) Any action taken by the Trust Preferred Securities Guarantee
Trustee or its agents hereunder shall bind the Holders, and the signature
of the Trust Preferred Securities Guarantee Trustee or its agents alone
shall be sufficient and effective to perform any such action. No third
party shall be required to inquire as to the authority of the Trust
Preferred Securities Guarantee Trustee to so act or as to its compliance
with any of the terms and provisions of this Trust Preferred Securities
Guarantee, both of which shall be conclusively evidenced by the Trust
Preferred Securities Guarantee Trustee's or its agent's taking such action.
(x) Whenever in the administration of this Trust Preferred Securities
Guarantee the Trust Preferred Securities Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Trust Preferred Securities
Guarantee Trustee (i) may request instructions from the Holders of a
Majority in liquidation amount of the Trust Preferred Securities, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received and (iii) shall be protected in
conclusively relying on or acting in accordance with such instructions.
(xi) The Trust Preferred Securities Guarantee Trustee shall not be
liable for any action taken, suffered, or omitted to be taken by it in good
faith, without negligence, and reasonably believed by it to be authorized
or within the discretion or rights or powers conferred upon it by this
Trust Preferred Securities Guarantee.
(b) No provision of this Trust Preferred Securities Guarantee shall
be deemed to impose any duty or obligation on the Trust Preferred Securities
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any
11
<PAGE>
jurisdiction in which it shall be illegal, or in which the Trust Preferred
Securities Guarantee Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to
exercise any such right, power, duty or obligation. No permissive power or
authority available to the Trust Preferred Securities Guarantee Trustee shall
be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Trust Preferred
Securities Guarantee
The recitals contained in this Trust Preferred Securities Guarantee
shall be taken as the statements of the Guarantor, and the Trust Preferred
Securities Guarantee Trustee does not assume any responsibility for their
correctness. The Trust Preferred Securities Guarantee Trustee makes no
representation as to the validity or sufficiency of this Trust Preferred
Securities Guarantee.
ARTICLE IV
TRUST PREFERRED SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Trust Preferred Securities Guarantee Trustee; Eligibility
(a) There shall at all times be a Trust Preferred Securities
Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or of the
District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least 50 million
U.S. dollars ($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then, for the purposes of this Section 4.1(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Trust Preferred Securities Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the Trust Preferred
Securities Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
(c) If the Trust Preferred Securities Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Trust
12
<PAGE>
Preferred Securities Guarantee Trustee and Guarantor shall in all respects
comply with the provisions of Section 310(b) of the Trust Indenture Act,
subject to the penultimate paragraph thereof.
SECTION 4.2 Appointment, Removal and Resignation of Trust Preferred
Securities Guarantee Trustee
(a) Subject to Section 4.2(b), the Trust Preferred Securities
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.
(b) The Trust Preferred Securities Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Trust Preferred
Securities Guarantee Trustee has been appointed and has accepted such
appointment by written instrument executed by such Successor Trust Preferred
Securities Guarantee Trustee and delivered to the Guarantor.
(c) The Trust Preferred Securities Guarantee Trustee shall hold
office until a Successor Trust Preferred Securities Guarantee Trustee shall have
been appointed or until its removal or resignation. The Trust Preferred
Securities Guarantee Trustee may resign from office (without need for prior or
subsequent accounting) by an instrument in writing executed by the Trust
Preferred Securities Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Trust Preferred Securities
Guarantee Trustee has been appointed and has accepted such appointment by
instrument in writing executed by such Successor Trust Preferred Securities
Guarantee Trustee and delivered to the Guarantor and the resigning Trust
Preferred Securities Guarantee Trustee.
(d) If no Successor Trust Preferred Securities Guarantee Trustee
shall have been appointed and accepted appointment as provided in this Section
4.2 within 60 days after delivery of an instrument of removal or resignation,
the Trust Preferred Securities Guarantee Trustee resigning or being removed may
petition any court of competent jurisdiction for appointment of a Successor
Trust Preferred Securities Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Trust Preferred Securities Guarantee Trustee.
(e) No Trust Preferred Securities Guarantee Trustee shall be liable
for the acts or omissions to act of any Successor Trust Preferred Securities
Guarantee Trustee.
(f) Upon termination of this Trust Preferred Securities Guarantee or
removal or resignation of the Trust Preferred Securities Guarantee Trustee
pursuant to this Section 4.2, the Guarantor shall pay to the Trust Preferred
Securities Guarantee Trustee all amounts due to the Trust Preferred Securities
Guarantee Trustee accrued to the date of such termination, removal or
resignation.
13
<PAGE>
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense, right of
set-off or counterclaim that the Issuer may have or assert. The Guarantor's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Guarantor to the Holders or by causing the Issuer to pay
such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this Trust
Preferred Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the Guarantor
under this Trust Preferred Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Trust Preferred Securities to be
performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution (as
defined in the Declaration) or any other sums payable under the terms of the
Trust Preferred Securities or the extension of time for the performance of any
other obligation under, arising out of, or in connection with, the Trust
Preferred Securities (other than an extension of time for payment of
Distributions, Redemption Price, Liquidation Distribution or other sum payable
that results from the extension of any interest payment period on the Debentures
permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Trust Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
14
<PAGE>
(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the benefit
of creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer or any of the assets of
the Issuer;
(e) any invalidity of, or defect or deficiency in, the Trust
Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred;
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor with respect to the
Guarantee Payments shall be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the Trust
Preferred Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trust Preferred
Securities Guarantee Trustee in respect of this Trust Preferred Securities
Guarantee or exercising any trust or power conferred upon the Trust Preferred
Securities Guarantee Trustee under this Trust Preferred Securities Guarantee.
(b) If the Trust Preferred Securities Guarantee Trustee fails to
enforce such Trust Preferred Securities Guarantee, any Holder may institute a
legal proceeding directly against the Guarantor to enforce the Trust Preferred
Securities Guarantee Trustee's rights under this Trust Preferred Securities
Guarantee, without first instituting a legal proceeding against the Issuer, the
Trust Preferred Securities Guarantee Trustee or any other person or entity. The
Guarantor waives any right or remedy to require that any action be brought first
against the Issuer or any other person or entity before proceeding directly
against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Trust Preferred Securities Guarantee creates a guarantee of
payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of the
Holders against the Issuer in respect of any amounts paid to such Holders by the
Guarantor under this Trust Preferred Securities Guarantee; provided, however,
that the Guarantor shall not (except to the extent
15
<PAGE>
required by mandatory provisions of law) be entitled to enforce or exercise
any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under
this Trust Preferred Securities Guarantee, if, at the time of any such
payment, any amounts are due and unpaid under this Trust Preferred Securities
Guarantee. If any amount shall be paid to the Guarantor in violation of the
preceding sentence, the Guarantor agrees to hold such amount in trust for the
Holders and to pay over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Trust Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Trust
Preferred Securities Guarantee notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Trust Preferred Securities remain outstanding, the
Guarantor shall not (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any of
the Guarantor's capital stock (which includes common and preferred stock), (ii)
make any payment of principal of or interest on or repay, repurchase or redeem
any debt securities of the Guarantor (including any Other Debentures) that rank
pari passu with or junior in right of payment to the Debentures or (iii) make
any guarantee payments with respect to any guarantee by the Guarantor of the
debt securities of any subsidiary of the Guarantor (including Other Guarantees)
if such guarantee ranks pari passu with or junior in right of payment to the
Debentures (other than (a) dividends or distributions in shares of, or options,
warrants, rights to subscribe for or purchase shares of, common stock of the
Guarantor, (b) any declaration of a dividend in connection with the
implementation of a stockholders' rights plan, or the issuance of stock under
any such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under the Trust Preferred Securities Guarantee,
(d) the purchase of fractional shares resulting from a reclassification of the
Guarantor's capital stock, (e) the purchase of fractional interests in shares of
the Guarantor's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged and (f)
purchases of common stock related to the issuance of common stock or rights
under any of the Guarantor's benefit plans for its directors, officers or
employees or any of the Guarantor's dividend reinvestment plans) if at such time
(i) there shall have occurred any event of which the Guarantor has actual
knowledge that (a) is, or with the giving of notice or the lapse of time, or
both, would be an Indenture Event of Default and (b) in respect of which the
Guarantor shall not have taken reasonable steps to cure, (ii) if such Debentures
are held by the Property Trustee, the Guarantor shall be in default with respect
to its payment of any obligations under
16
<PAGE>
this Trust Preferred Securities Guarantee or (iii) the Guarantor shall have
given notice of its election of the exercise of its right to extend the
interest payment period pursuant to Section 16.01 of the Indenture and any
such extension shall be continuing.
SECTION 6.2 Ranking
This Trust Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to Senior and Subordinated Indebtedness (as defined in the Indenture),
to the same extent and in the same manner that the Debentures are subordinated
to Senior and Subordinated Indebtedness pursuant to the Indenture, (ii) pari
passu with the Debentures, the Other Debentures, the Common Securities Guarantee
and any Other Guarantee and any Other Common Securities Guarantee, and (iii)
senior to the Guarantor's capital stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Trust Preferred Securities Guarantee shall terminate (i) upon
full payment of the Redemption Price (as defined in the Declaration) of all
Trust Preferred Securities or (ii) upon liquidation of the Issuer, the full
payment of the amounts payable in accordance with the Declaration or the
distribution of the Debentures to the Holders and the holders of Common
Securities. Notwithstanding the foregoing, this Trust Preferred Securities
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid under the
Trust Preferred Securities or under this Trust Preferred Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Trust Preferred
Securities Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Trust Preferred Securities Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
17
<PAGE>
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against, any and all loss, liability,
damage, claim or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 8.2 shall survive the termination of this
Trust Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Trust Preferred
Securities Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not materially adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Trust Preferred Securities Guarantee may only be amended with
the prior approval of the Holders of a Majority in liquidation amount of the
Trust Preferred Securities (including the stated amount that would be paid on
redemption, liquidation or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined). The provisions of
the Declaration with respect to consents to amendments thereof (whether at a
meeting or otherwise) shall apply to the giving of such approval.
18
<PAGE>
SECTION 9.3 Notices
All notices provided for in this Trust Preferred Securities Guarantee
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Issuer, in care of the Administrative Trustee at
the Issuer's mailing address set forth below (or such other address as the
Issuer may give notice of to the Holders and the Trust Preferred Securities
Guarantee Trustee):
Independent Capital Trust I
c/o The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Richard J. Seaman
Administrative Trustee
Telecopy: (212) 815-5917
(b) If given to the Trust Preferred Securities Guarantee Trustee, at
the Trust Preferred Securities Guarantee Trustee's mailing address set forth
below (or such other address as the Trust Preferred Securities Guarantee Trustee
may give notice of to the Holders and the Issuer):
The Bank of New York
101 Barclay Street
21st Floor West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Telecopy: (212) 815-5917
(c) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders and the Trust Preferred Securities Guarantee Trustee):
Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Attention: Richard J. Seaman
Chief Financial Officer
Telecopy: (617) 982-6130
(d) If given to any Holder, at the address set forth on the books and
records of the Issuer.
19
<PAGE>
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 8.4 Benefit
This Trust Preferred Securities Guarantee is solely for the benefit of
the Holders and, subject to Section 3.1(a), is not separately transferable from
the Trust Preferred Securities.
SECTION 8.5 Governing Law
THIS TRUST PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
20
<PAGE>
THIS TRUST PREFERRED SECURITIES GUARANTEE is executed as of the day
and year first above written.
INDEPENDENT BANK CORP., as Guarantor
By:
-------------------------------------
Name: Richard J. Seaman
Title: Chief Financial Officer
THE BANK OF NEW YORK, as Trust Preferred
Securities Guarantee Trustee
By:
-------------------------------------
Name:
Title:
21
<PAGE>
EXHIBIT 12.1
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
Excluding interest on deposits
<TABLE>
<CAPTION>
1996 1995 1994 1993 1992
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C>
Net Income (loss) 11,597 10,387 8,113 4,636 175
Income tax expense (benefit) 6,153 4,729 1,533 483 215
---------- ---------- --------- --------- ----------
Pretax earnings (loss) 17,750 15,116 9,646 5,119 390
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Fixed Charges:
One-third of rental expense
which approximated the interest
factor 768 682 509 479 468
Interest on borrowed funds 4,684 3,101 1,562 966 1,116
---------- ---------- --------- --------- ----------
Total Fixed charges 5,452 3,783 2,071 1,445 1,584
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Earnings (for ratio calculation) 23,202 18,899 11,717 6,564 1,974
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Ratio of earnings to fixed
charges 4.26 5.00 5.66 4.54 1.25
</TABLE>
<PAGE>
EXHIBIT 12.2
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
Including interest on deposits
<TABLE>
<CAPTION>
1996 1995 1994 1993 1992
(Dollars in Thousands)
<S> <C> <C> <C> <C> <C>
Net Income (loss) 11,597 10,387 8,113 4,636 175
Income tax expense (benefit) 6,153 4,729 1,533 483 215
---------- ---------- --------- --------- ----------
Pretax earnings (loss) 17,750 15,116 9,646 5,119 390
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Fixed Charges:
One-third of rental expense
which approximated the interest
factor 768 682 509 479 468
Interest on borrowed funds 32,354 29,143 22,029 22,920 29,127
---------- ---------- --------- --------- ----------
Total Fixed charges 33,122 29,825 22,538 23,399 29,595
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Earnings (for ratio calculation) 50,872 44,941 32,184 28,518 29,985
---------- ---------- --------- --------- ----------
---------- ---------- --------- --------- ----------
Ratio of earnings to fixed
charges 1.54 1.51 1.43 1.22 1.01
</TABLE>
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3, of our report dated
January 21, 1997, on our audit of the consolidated financial statements of
Independent Bank Corp., and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Boston, Massachusetts
April 25, 1997
<PAGE>
Exhibit 25.1
==============================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
------------------------
INDEPENDENT BANK CORP.
(Exact name of obligor as specified in its charter)
Massachusetts 04-2870273
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
288 Union Street
Rockland, Massachusetts 02370
(Address of principal executive offices) (Zip code)
______________________
Junior Subordinated Deferrable Interest Debentures
(Title of the indenture securities)
===========================================================================
<PAGE>
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
- ---------------------------------------------------------------------------
Name Address
- ---------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 25th day of April, 1997.
THE BANK OF NEW YORK
By: /s/ Walter N. Gitlin
----------------------------
Name: Walter N. Gitlin
Title: Vice President
-4-
<PAGE>
EXHIBIT 7
---------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September
30, 1996, published in accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
in Thousands
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin............................. $ 4,404,522
Interest-bearing balances...................................................... 732,833
Securities:
Held-to-maturity securities.................................................... 789,964
Available-for-sale securities.................................................. 2,005,509
Federal funds sold in domestic offices of the bank:
Federal funds sold............................................................. 3,364,838
Loans and lease financing receivables:
Loans and leases, net of unearned income....................................... 28,728,602
LESS: Allowance for loan and lease losses...................................... 584,525
LESS: Allocated transfer risk reserve.......................................... 429
Loans and leases, net of unearned income, allowance, and reserve............... 28,143,648
Assets held in trading accounts.................................................. 1,004,242
Premises and fixed assets (including capitalized leases)......................... 605,668
Other real estate owned.......................................................... 41,238
Investments in unconsolidated subsidiaries and associated companies.............. 205,031
Customers' liability to this bank on acceptances outstanding..................... 949,154
Intangible assets................................................................ 490,524
Other assets..................................................................... 1,305,839
-------------
Total assets................................................................... $ 44,043,010
-------------
-------------
LIABILITIES
Deposits:
In domestic offices............................................................ $ 20,441,318
Noninterest-bearing............................................................ 8,158,472
Interest-bearing............................................................... 12,282,846
In foreign offices, Edge and Agreement subsidiaries, and IBFs.................. 11,710,903
Noninterest-bearing............................................................ 46,182
Interest-bearing............................................................... 11,664,721
Federal funds purchased in domestic offices of the bank:
Federal funds purchased........................................................ 1,565,288
Demand notes issued to the U.S. Treasury....................................... 293,186
Trading liabilities............................................................ 826,856
Other borrowed money:
With original maturity of one year or less..................................... 2,103,443
With original maturity of more than one year................................... 20,766
Bank's liability on acceptances exe-cuted and outstanding...................... 951,116
Subordinated notes and debentures.............................................. 1,020,400
Other liabilities.............................................................. 1,522,884
-------------
Total liabilities.............................................................. 40,456,160
-------------
EQUITY CAPITAL
Common stock................................................................... 942,284
Surplus........................................................................ 525,666
Undivided profits and capital reserves......................................... 2,129,376
Net unrealized holding gains (losses) on available-for-sale securities......... (2,073)
Cumulative foreign currency transla-tion adjustments........................... (8,403)
-------------
Total equity capital........................................................... 3,586,850
-------------
Total liabilities and equity capital........................................... $ 44,043,010
-------------
-------------
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of
our knowledge and belief has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System
and is true and correct.
J. Carter Bacot }
Thomas A. Renyi } Directors
Alan R. Griffith }
-5-
<PAGE>
Exhibit 25.2
==============================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
------------------------
INDEPENDENT BANK CORP.
(Exact name of obligor as specified in its charter)
Massachusetts 04-2870273
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
288 Union Street
Rockland, Massachusetts 02370
(Address of principal executive offices) (Zip code)
------------------------
Guarantee of Trust Preferred Securities of
Independent Capital Trust I
(Title of the indenture securities)
==============================================================================
<PAGE>
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
- -------------------------------------------------------------------------------
Name Address
- -------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in The City of New
York, and State of New York, on the 25th day of April, 1997.
THE BANK OF NEW YORK
/s/ Walter N. Gitlin
By: ________________________________
Name: Walter N. Gitlin
Title: Vice President
-4-
<PAGE>
EXHIBIT 7
---------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September
30, 1996, published in accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
in Thousands
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin............................. $ 4,404,522
Interest-bearing balances...................................................... 732,833
Securities:
Held-to-maturity securities.................................................... 789,964
Available-for-sale securities.................................................. 2,005,509
Federal funds sold in domestic offices of the bank:
Federal funds sold............................................................. 3,364,838
Loans and lease financing receivables:
Loans and leases, net of unearned income....................................... 28,728,602
LESS: Allowance for loan and lease losses...................................... 584,525
LESS: Allocated transfer risk reserve.......................................... 429
Loans and leases, net of unearned income, allowance, and reserve............... 28,143,648
Assets held in trading accounts.................................................. 1,004,242
Premises and fixed assets (including capitalized leases)......................... 605,668
Other real estate owned.......................................................... 41,238
Investments in unconsolidated subsidiaries and associated companies.............. 205,031
Customers' liability to this bank on acceptances outstanding..................... 949,154
Intangible assets................................................................ 490,524
Other assets..................................................................... 1,305,839
-------------
Total assets................................................................... $ 44,043,010
-------------
-------------
LIABILITIES
Deposits:
In domestic offices............................................................ $ 20,441,318
Noninterest-bearing............................................................ 8,158,472
Interest-bearing............................................................... 12,282,846
In foreign offices, Edge and Agreement subsidiaries, and IBFs.................. 11,710,903
Noninterest-bearing............................................................ 46,182
Interest-bearing............................................................... 11,664,721
Federal funds purchased in domestic offices of the bank:
Federal funds purchased........................................................ 1,565,288
Demand notes issued to the U.S. Treasury....................................... 293,186
Trading liabilities............................................................ 826,856
Other borrowed money:
With original maturity of one year or less..................................... 2,103,443
With original maturity of more than one year................................... 20,766
Bank's liability on acceptances exe-cuted and outstanding...................... 951,116
Subordinated notes and debentures.............................................. 1,020,400
Other liabilities.............................................................. 1,522,884
-------------
Total liabilities.............................................................. 40,456,160
-------------
EQUITY CAPITAL
Common stock................................................................... 942,284
Surplus........................................................................ 525,666
Undivided profits and capital reserves......................................... 2,129,376
Net unrealized holding gains (losses) on available-for-sale securities......... (2,073)
Cumulative foreign currency transla-tion adjustments........................... (8,403)
-------------
Total equity capital........................................................... 3,586,850
-------------
Total liabilities and equity capital........................................... $ 44,043,010
-------------
-------------
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of
our knowledge and belief has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System
and is true and correct.
J. Carter Bacot }
Thomas A. Renyi } Directors
Alan R. Griffith }
-5-
<PAGE>
Exhibit 25.3
==============================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
------------------------
INDEPENDENT CAPITAL TRUST I
(Exact name of obligor as specified in its charter)
Delaware Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
c/o The Bank of New York
101 Barclay Street, 21w
New York, New York 10286
(Address of principal executive offices) (Zip code)
------------------------
Trust Preferred Securities
(Title of the indenture securities)
==============================================================================
<PAGE>
1. General information. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
- ------------------------------------------------------------------------------
Name Address
- ------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany,
N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule
7a-29 under the Trust Indenture Act of 1939 (the "Act") and 17 C.F.R.
229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in The City of New
York, and State of New York, on the 25th day of April, 1997.
THE BANK OF NEW YORK
/s/ Walter N. Gitlin
By: ______________________________
Name: Walter N. Gitlin
Title: Vice President
-4-
<PAGE>
EXHIBIT 7
---------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business September
30, 1996, published in accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
in Thousands
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin............................. $ 4,404,522
Interest-bearing balances...................................................... 732,833
Securities:
Held-to-maturity securities.................................................... 789,964
Available-for-sale securities.................................................. 2,005,509
Federal funds sold in domestic offices of the bank:
Federal funds sold............................................................. 3,364,838
Loans and lease financing receivables:
Loans and leases, net of unearned income....................................... 28,728,602
LESS: Allowance for loan and lease losses...................................... 584,525
LESS: Allocated transfer risk reserve.......................................... 429
Loans and leases, net of unearned income, allowance, and reserve............... 28,143,648
Assets held in trading accounts.................................................. 1,004,242
Premises and fixed assets (including capitalized leases)......................... 605,668
Other real estate owned.......................................................... 41,238
Investments in unconsolidated subsidiaries and associated companies.............. 205,031
Customers' liability to this bank on acceptances outstanding..................... 949,154
Intangible assets................................................................ 490,524
Other assets..................................................................... 1,305,839
-------------
Total assets................................................................... $ 44,043,010
-------------
-------------
LIABILITIES
Deposits:
In domestic offices............................................................ $ 20,441,318
Noninterest-bearing............................................................ 8,158,472
Interest-bearing............................................................... 12,282,846
In foreign offices, Edge and Agreement subsidiaries, and IBFs.................. 11,710,903
Noninterest-bearing............................................................ 46,182
Interest-bearing............................................................... 11,664,721
Federal funds purchased in domestic offices of the bank:
Federal funds purchased........................................................ 1,565,288
Demand notes issued to the U.S. Treasury....................................... 293,186
Trading liabilities............................................................ 826,856
Other borrowed money:
With original maturity of one year or less..................................... 2,103,443
With original maturity of more than one year................................... 20,766
Bank's liability on acceptances exe-cuted and outstanding...................... 951,116
Subordinated notes and debentures.............................................. 1,020,400
Other liabilities.............................................................. 1,522,884
-------------
Total liabilities.............................................................. 40,456,160
-------------
EQUITY CAPITAL
Common stock................................................................... 942,284
Surplus........................................................................ 525,666
Undivided profits and capital reserves......................................... 2,129,376
Net unrealized holding gains (losses) on available-for-sale securities......... (2,073)
Cumulative foreign currency transla-tion adjustments........................... (8,403)
-------------
Total equity capital........................................................... 3,586,850
-------------
Total liabilities and equity capital........................................... $ 44,043,010
-------------
-------------
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of
Governors of the Federal Reserve System and is true to the best of my
knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of
our knowledge and belief has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System
and is true and correct.
J. Carter Bacot }
Thomas A. Renyi } Directors
Alan R. Griffith }
-5-
