<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 28, 1999
REGISTRATION NO. 333-
333- 01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------
<TABLE>
<S> <C>
INDEPENDENT BANK CORP INDEPENDENT CAPITAL TRUST II
(Exact name of Registrant as (Exact name of Registrant as
specified 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 04-6901632
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
</TABLE>
----------------------------------
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:
<TABLE>
<S> <C>
NORMAN B. ANTIN, ESQ. RICHARD A. SCHABERG, ESQ.
JEFFREY D. HAAS, ESQ. THACHER PROFFITT & WOOD
ELIAS, MATZ, TIERNAN & HERRICK L.L.P. 1700 PENNSYLVANIA AVENUE
734 15TH STREET, N.W. WASHINGTON, D.C. 20006
WASHINGTON, D.C. 20005
</TABLE>
----------------------------------
Approximate Date of Commencement of Proposed Sale to the Public:
As soon as practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. / /
If this form is filed to register additional securities for an offering
pursuant to Rule 462 under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / ________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier registration statement for the same
offering. / / ________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
----------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS 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 II........................... $23,000,000 100% $23,000,000 $6,394
Junior Subordinated Deferrable Interest
Debentures of Independent Bank Corp.(2).... $23,000,000 100% $23,000,000 N/A
Independent Bank Corp. Guarantee with respect
to the Trust Preferred Securities(3)....... N/A N/A N/A N/A
Total........................................ $23,000,000(4) 100% $23,000,000(4) $6,394
</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 II.
(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 II 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 II.
----------------------------------
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>
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the Securities and Exchange Commission declares
our registration statement effective. This prospectus is not an offer to sell
these securities and is not soliciting an offer to buy these securities in any
state where the offer or sale is not permitted.
<PAGE>
SUBJECT TO COMPLETION, DATED OCTOBER 28, 1999
2,000,000 TRUST PREFERRED SECURITIES
INDEPENDENT CAPITAL TRUST II
% CUMULATIVE TRUST PREFERRED SECURITIES
(LIQUIDATION AMOUNT $10 PER TRUST PREFERRED SECURITY)
[LOGO]
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
INDEPENDENT BANK CORP.
---------------------
INDEPENDENT BANK CORP.: We are a bank holding company that offers, through
our subsidiary Rockland Trust Company, a full range of commercial and retail
banking and trust services to our customers in Southeastern Massachusetts.
INDEPENDENT CAPITAL TRUST II: Independent Capital Trust II is a subsidiary
of Independent Bank Corp. and a statutory business trust created under Delaware
law.
THE OFFERING: In connection with this offering, the Trust will sell Trust
Preferred Securities to the public and Common Securities to us; use the proceeds
from these sales to buy an equivalent principal amount of % Junior
Subordinated Debentures due , 2029 issued by us, and distribute the
future cash payments it receives on the Junior Subordinated Debentures to the
holders of the Trust Preferred Securities and Common Securities.
- For each Trust Preferred Security that you own, you will receive
cumulative cash distributions at an annual rate of % on March 31,
June 30, September 30 and December 31 of each year, beginning
, 1999. Distribution payments to you may be deferred for up to
20 consecutive calendar quarters.
- The Trust Preferred Securities mature on , 2029.
- The Trust may redeem the Trust Preferred Securities, at a redemption price
of $10 per Trust Preferred Security on or after , 2004, plus
accrued and unpaid distributions, and under certain other circumstances.
- A brief description of the Trust Preferred Securities can be found under
"Summary" in this prospectus.
- We intend to apply for listing of the Trust Preferred Securities on the
Nasdaq National Market under the symbol "INDBO."
--------------------------
THERE ARE CERTAIN RISKS YOU SHOULD CONSIDER BEFORE INVESTING IN THE TRUST
PREFERRED SECURITIES. SEE "RISK FACTORS" BEGINNING ON PAGE 10.
--------------------------
<TABLE>
<CAPTION>
PER SECURITY TOTAL
------------ --------
<S> <C> <C>
Public Offering Price....................................... $10.00 $
Proceeds to the Trust....................................... $10.00 $
</TABLE>
In view of the fact that the proceeds of the sale of the Trust Preferred
Securities will be invested in the Junior Subordinated Debentures, we,
Independent Bank Corp., as issuer of the Junior Subordinated Debentures, have
agreed to pay the underwriter $ per Trust Preferred Security (or
$ ($ if the underwriter's over-allotment option is exercised
in full) in the aggregate) as compensation.
We and the Trust have granted the underwriter a 30-day option to purchase up
to 300,000 additional Trust Preferred Securities on the same terms and
conditions discussed above solely to cover over-allotments, if any. If this
option is exercised in full, the total Public Offering Price and Proceeds to the
Trust will be $ and $ .
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OF ANYONE'S INVESTMENT IN THESE SECURITIES OR DETERMINED
IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OBLIGATIONS OF ANY
BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY.
The Trust Preferred Securities will be ready for delivery in book-entry form
through The Depository Trust Company on or about , 1999.
--------------------------
Legg Mason Wood Walker
Incorporated
The date of this prospectus is , 1999
<PAGE>
[MAP]
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Forward Looking Statements..................................
Where You Can Find More Information.........................
Summary.....................................................
Summary Consolidated Financial and Other Data...............
Risk Factors................................................
Ratios of Earnings to Fixed Charges.........................
Use of Proceeds.............................................
Capitalization..............................................
Independent Capital Trust II................................
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...............................................
Experts.....................................................
</TABLE>
------------------------
FORWARD LOOKING STATEMENTS
This document contains and incorporates by reference certain forward looking
statements regarding our financial condition, results of operations and
business. These statements are not historical facts and include statements about
our
- confidence,
- strategies about earnings,
- new and existing programs and products,
- relationships,
- opportunities,
- technology, and
- market conditions.
You may identify these statements by looking for
- forward-looking terminology, like "expect," "believe" or "anticipate;"
- expressions of confidence like "strong" or "on-going;" or
- similar statements or variations of those terms.
i
<PAGE>
These forward-looking statements involve certain risks and uncertainties.
Actual results may differ materially from the results the forward-looking
statements contemplate because of, among others, the following possibilities:
- competitive pressure in the banking and financial services industry
increases significantly;
- changes occur in the interest rate environment;
- our Year 2000 compliance program does not effectively address Year 2000
computer problems; and
- general economic conditions, either nationally, in New England or in the
state of Massachusetts, are less favorable than expected.
------------------------
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). Our SEC
filings are available to the public over the Internet at the SEC's web site at
http://www.sec.gov. You may also read and copy any documents we file with the
SEC at its public reference facilities at 450 Fifth Street, NW, Washington, DC
20549, 7 World Trade Center, Suite 1300, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. You
can also obtain copies of the documents at prescribed rates by writing to the
Public Reference Section of the SEC at 450 Fifth Street, NW, Washington, DC
20549. Please call the SEC at 1-800-SEC-0330 for further information on the
operation of the public reference facilities. Our SEC filings are also available
at the office of the Nasdaq National Market. For further information on
obtaining copies of our public filings at the Nasdaq National Market, you should
call (212) 656-5060.
The Trust is not currently subject to the information reporting requirements
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Trust will become subject to such requirements upon the effectiveness of the
registration statement that contains this prospectus, although it intends to
seek and expects to receive an exemption therefrom.
We and the Trust have filed with the SEC a registration statement on
Form S-3 (together with all amendments thereto, the "registration statement"),
of which this prospectus is a part, under the Securities Act of 1933, as amended
(the "Securities Act") with respect to the Trust Preferred Securities, the
Junior Subordinated Debentures and the Guarantee, each of which is discussed in
this prospectus. This prospectus does not contain all of the information set
forth in the registration statement, certain portions of which have been omitted
as permitted by the rules and regulations of the SEC. For further information
with respect to us, the Trust, the Trust Preferred Securities, the Junior
Subordinated Debentures and the Guarantee, reference is made to the registration
statement, including its exhibits. The registration statement may be inspected
without charge at the principal office of the SEC in Washington, D.C., and
copies of all or part of it may be obtained from the SEC upon payment of the
prescribed fees.
We "incorporate by reference" into this prospectus the information we file
with the SEC, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus and information that we file subsequently
with the SEC will automatically update this prospectus. We incorporate by
reference the documents listed below and any filings we make with the SEC under
Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act, after the initial
filing of the registration statement that contains this prospectus and prior to
the time that we sell all the securities offered by this prospectus:
- Annual Report on Form 10-K for the year ended December 31, 1998.
ii
<PAGE>
- Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999,
June 30, 1999 and September 30, 1999.
- Current Report on Form 8-K filed with the SEC on October 1, 1999.
You may request a copy of these filings (other than an exhibit to a filing
unless that exhibit is specifically incorporated by reference into that filing)
at no cost, by writing to or telephoning us at the following address: 288 Union
Street, Rockland, Massachusetts 02370, Attention: Corporate Secretary, telephone
(781) 878-6100.
------------------------
WE HAVE NOT, AND THE UNDERWRITER HAS NOT, AUTHORIZED ANY OTHER PERSON TO
PROVIDE YOU WITH DIFFERENT INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL,
NOR IS IT SEEKING AN OFFER TO BUY, THESE TRUST PREFERRED SECURITIES IN ANY STATE
WHERE THE OFFER OR SALE IS NOT PERMITTED. THE INFORMATION IN THIS PROSPECTUS IS
COMPLETE AND ACCURATE AS OF THE DATE ON THE FRONT COVER, BUT THE INFORMATION MAY
HAVE CHANGED SINCE THAT DATE.
iii
<PAGE>
SUMMARY
THE ITEMS IN THE FOLLOWING SUMMARY ARE DESCRIBED IN MORE DETAIL LATER IN
THIS PROSPECTUS. THIS SUMMARY PROVIDES AN OVERVIEW OF SELECTED INFORMATION AND
DOES NOT CONTAIN ALL THE INFORMATION YOU SHOULD CONSIDER. THEREFORE, YOU SHOULD
ALSO READ THE MORE DETAILED INFORMATION SET OUT IN THIS PROSPECTUS OR
INCORPORATED HEREIN BY REFERENCE. IN THIS PROSPECTUS, REFERENCES TO "WE," "OUR,"
AND "INDEPENDENT" ARE TO INDEPENDENT BANK CORP.
OUR COMPANY
We are the holding company of Rockland Trust Company (the "Bank"), a
Massachusetts trust company which was chartered in 1907. We are headquartered in
Rockland, Massachusetts and at September 30, 1999, we had consolidated assets of
$1.6 billion, deposits of $1.1 billion and stockholders' equity of $94 million.
Through the Bank, we offer a full range of commercial and retail banking and
trust services through our network of 34 banking offices, eight commercial
lending centers, and two trust and financial services offices located in the
Plymouth, Norfolk, and Bristol Counties of Southeastern Massachusetts. We are
the only locally-based commercial bank in Plymouth County. As a community
focused commercial bank, we seek to service the needs of local customers in our
market by developing long-term deposit and lending relationships. As such, we
have become a prominent financial institution in Plymouth County, which
represents the majority of our market area. At June 30, 1998 (the most recent
date for deposit market share information), the Bank had approximately 22.4% of
the total deposits in Plymouth County. That amount represents approximately 178%
of the market share of our closest competitor.
In its lending activities, the Bank has emphasized the origination of
residential and commercial loans within its primary market areas. At
September 30, 1999, the Bank's gross loan portfolio consisted of 30% mortgage
loans collateralized by commercial real estate, 20% of mortgage loans
collateralized by residential real estate, 13% of commercial loans, 5% of real
estate construction loans, and 32% of 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.
In May 1997, we issued $28.75 million of 9.28% cumulative trust preferred
securities of Independent Capital Trust I ("Trust I"), which are scheduled to
mature in 2027. Trust I invested the proceeds of the sale of these securities in
$29.64 million of 9.28% junior subordinated debentures issued by us.
Distributions on these securities are payable quarterly in arrears on the last
day of March, June, September and December, such distributions can be deferred
at our option for up to five years. The trust preferred securities can be
prepaid in whole or in part on or after May 19, 2002 at a redemption price equal
to $25 per security plus accumulated but unpaid distributions thereon to the
date of the redemption. The trust preferred securities of Trust I are quoted on
the Nasdaq National Market under the symbol "INDBP."
PENDING BRANCH ACQUISITION. In September 1999, we entered into an agreement
with Fleet Financial Group, Inc., Fleet National Bank and BankBoston, N.A. to
acquire 12 branches, two of which are located in Brockton, Massachusetts, which
is within our primary market area, and ten of which are located on Cape Cod,
Massachusetts in Barnstable County, a market contiguous to where we presently
operate. The 12 branches to be acquired presently have total deposits
aggregating approximately $269 million. In connection with the acquisition,
which is subject to, among other things, the receipt of regulatory approvals, we
expect to acquire approximately $150 million of commercial and consumer loans.
Following the acquisition, we will have approximately $1.8 billion in assets,
$1.3 billion in deposits and 46 retail branches. We expect to pay a core deposit
premium of approximately $32 million in connection with the acquisition. We
filed our regulatory applications in October 1999 and presently expect that the
transaction will close during the third quarter of 2000.
<PAGE>
Our principal office is located at 288 Union Street, Rockland, Massachusetts
02370 and our telephone number is (781) 878-6100.
INDEPENDENT CAPITAL TRUST II
Independent Capital Trust II (the "Trust"), the issuer of the Trust
Preferred Securities, is a statutory business trust formed by us under the
Delaware Business Trust Act. The Trust exists for the sole purpose of
(i) issuing common securities of the Trust (the "Common Securities") to us and
the Trust Preferred Securities (the Trust Preferred Securities and the Common
Securities are referred to in this prospectus as the "Trust Securities") for
cash and investing the proceeds in an equivalent amount of % Junior
Subordinated Deferrable Interest Debentures due , 2029 (the "Junior
Subordinated Debentures") issued by us and (ii) engaging in other activities
that are necessary or incidental to the issuance of the Trust Securities and the
investment in the Junior Subordinated Debentures.
The Trust has no separate financial statements. We do not believe that the
statements would be significant to you because the Trust is a direct wholly
owned subsidiary of the Company, has no independent operations and exists solely
for the reasons summarized above.
The Trust's principal office is located at c/o The Bank of New York, 101
Barclay Street, New York, New York 10286 and its telephone number is
(212) 815-5359.
RISK FACTORS
Prior to making an investment decision, you should carefully consider all of
the information in this prospectus, and, in particular, you should evaluate the
risk factors set forth under the caption "Risk Factors," which are described
immediately following this Summary.
2
<PAGE>
THE OFFERING
<TABLE>
<S> <C>
Issuer of the Trust Preferred Securities..... Independent Capital Trust II, a Delaware
statutory business trust.
Securities offered........................... 2,000,000 % Trust Preferred Securities,
liquidation amount $10 per security
(2,300,000 Trust Preferred Securities if the
underwriter's over-allotment option is
exercised in full). The Trust Preferred
Securities represent preferred undivided
beneficial interests in the Trust's assets,
which will consist solely of the Junior
Subordinated Debentures and payments under
the Junior Subordinated Debentures.
The Trust will sell the Trust Preferred
Securities to the public and the Common
Securities to us. The Trust will use the
proceeds from the sale of the Trust
Securities to buy the Junior Subordinated
Debentures from us.
Distributions................................ If you purchase the Trust Preferred
Securities, you will be entitled to receive
cumulative cash distributions at a %
annual rate. Distributions will accumulate
from the date the Trust issues the Trust
Preferred Securities, and will be paid
quarterly in arrears on March 31, June 30,
September 30 and December 31 of each year,
beginning on , 1999.
Distributions on the Trust Preferred
Securities may be deferred, as described
below. The initial cash distribution payable
on , 1999 will equal $ for
each Trust Preferred Security. Subsequent
cash distributions will equal $ for each
Trust Preferred Security.
The record date for distributions on the
Trust Preferred Securities will be one
business day prior to the relevant
distribution date for so long as the Trust
Preferred Securities remain in book-entry
form (if not book-entry form the record date
will be the fifteenth day of the month in
which the distributions are made).
Maturity..................................... The Junior Subordinated Debentures will
mature on , 2029.
Redemption................................... We may redeem all or a part of the Junior
Subordinated Debentures on or after , 2004 at
a redemption price of $10 per Junior
Subordinated Debenture, plus accrued and
unpaid distributions.
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
In addition, we may redeem all of the Junior
Subordinated Debentures at our option:
- if certain tax events occur;
- if there is a change in the Investment
Company Act of 1940 that requires the
Trust to register under that law; or
- if there is a change in, among other
things, the regulatory capital adequacy
guidelines that apply to us.
These circumstances are collectively referred
to as "Special Events."
We will not redeem the Junior Subordinated
Debentures before they mature without
approval by the regulatory agencies which
supervise us if such approval is then
required under applicable requirements.
Upon any redemption of the Junior
Subordinated Debentures, the Trust will use
the cash proceeds of such redemption to pay
you a liquidation amount for the Trust
Preferred Securities. The liquidation amount
you will receive will be equal to the
redemption price described above.
Deferral of distributions.................... The Trust relies solely on payments made by
us on the Junior Subordinated Debentures to
pay distributions on the Trust Preferred
Securities. If no event of default under the
Junior Subordinated Debentures has occurred
or is continuing, we have the right, at one
or more times, to defer interest payments on
the Junior Subordinated Debentures for up to
20 consecutive calendar quarters, but not
beyond the maturity date of the Junior
Subordinated Debentures. If we defer interest
payments on the Junior Subordinated
Debentures:
- the Trust will also defer distributions
on the Trust Preferred Securities;
- your distributions will continue to
accrue at an annual rate of % of the
liquidation amount of $10 per Trust
Preferred Security; and
- you will accumulate additional
distributions at the same rate,
compounded quarterly, on any unpaid
distributions (to the extent permitted
by law).
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
When a deferral period ends, we will be
required to pay to the Trust all accumulated
and unpaid interest due on the Junior
Subordinated Debentures and, when the Trust
receives this payment, it will be required to
pay all accumulated and unpaid distributions
on the Trust Securities.
If we defer payments of interest on the
Junior Subordinated Debentures, the Trust
Preferred Securities will be treated as being
issued with original issue discount for
United States federal income tax purposes.
This means that you will still be required to
include income in your gross income for
United States federal income tax purposes
before you receive any corresponding cash
distribution, even if you are a cash basis
taxpayer.
We have agreed to certain restrictions if we
exercise our right to defer interest
payments. During any period in which we defer
interest payments on the Junior Subordinated
Debentures, we will not be permitted to (with
limited exceptions described under
"Description of Junior Subordinated
Debentures--Option to Extend Interest Payment
Date"):
- declare or pay dividends or make other
distributions on, redeem, purchase or
acquire, or make liquidation payments
with respect to, our capital stock;
- pay interest, principal or premium on,
or repay, repurchase or redeem any of our
debt securities that rank equal with or
junior to the Junior Subordinated
Debentures; or
- make guarantee payments with respect to
the foregoing.
Guarantee.................................... We will fully and unconditionally guarantee
the Trust Preferred Securities based on:
- our obligations to make payments on the
Junior Subordinated Debentures;
- our obligations under a guarantee
executed for your benefit (the
"Guarantee"); and
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
- our obligations under the Trust
Agreement, which sets forth the terms of
the Trust Securities.
If we do not make payments on the Junior
Subordinated Debentures, the Trust will not
have sufficient funds to make payments on the
Trust Preferred Securities. The Guarantee
does not cover payments when the Trust does
not have sufficient funds. Instead, you (to
the fullest extent of the law) or the
property trustee may enforce the holder's
rights under the Junior Subordinated
Debentures directly against us.
Distribution of the Junior Subordinated
Debentures................................. We may dissolve the Trust at any time and
distribute the Junior Subordinated Debentures
to you, subject to any required approval by
the regulatory agencies which supervise us.
If the Junior Subordinated Debentures are
distributed, we will use our best efforts to
list them on a national securities exchange
or comparable automated quotation system.
Ranking...................................... Our obligations under the Junior Subordinated
Debentures are unsecured and will rank junior
in priority of payment to our current and any
future senior and subordinated indebtedness
and will be effectively subordinated to all
existing and future liabilities and
obligations of our subsidiaries, including
the Bank. As of September 30, 1999, we had no
senior or subordinated indebtedness
outstanding and our subsidiaries had total
liabilities (excluding liabilities owed to
us) of $1.5 billion. Our obligations under
the Junior Subordinated Debentures will rank
equal to other junior subordinated debentures
issued or to be issued by us to similar
trusts, including the junior subordinated
debentures sold to Trust I in May 1997.
Our obligations under the Guarantee are
unsecured and will rank in priority of
payment:
- junior to all of our indebtedness,
except for those liabilities made equal
or subordinate to the Junior
Subordinated Debentures by their terms;
</TABLE>
6
<PAGE>
<TABLE>
<S> <C>
- equal to all other guarantees issued or
to be issued by us with respect to other
similar trust preferred securities,
including the issuance of $28.75
million of trust preferred securities
of Trust I in May 1997; and
- senior to our capital stock.
Limited voting rights........................ Except in limited circumstances, you as a
holder of the Trust Preferred Securities will
have no voting rights.
Listing...................................... We intend to apply for listing of the Trust
Preferred Securities on the Nasdaq National
Market under the symbol "INDBO."
Book-entry................................... The Trust Preferred Securities will be
represented by a global security that will be
deposited with and registered in the name of
The Depository Trust Company, New York, New
York or its nominee. This means that you will
not receive a certificate for your Trust
Preferred Securities.
Use of proceeds.............................. The Trust plans to use the proceeds from the
sale of the Trust Securities to purchase the
Junior Subordinated Debentures from us. We
intend to use the net proceeds from the sale
of the Junior Subordinated Debentures for
general corporate purposes, which shall
include capital contributions to the Bank,
and for working capital.
- To the extent that the previously
announced branch acquisition
transaction with Fleet Financial Group,
Inc. is completed, the offering will
ensure that the Bank will continue to
be "well capitalized" following
consummation of the transaction.
Initially, we may use the net proceeds to
make short-term investments.
</TABLE>
7
<PAGE>
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
The selected consolidated financial and other data below should be read in
connection with the financial information included in our Annual Report on
Form 10-K for the year ended December 31, 1998 and our Quarterly Report on
Form 10-Q for the nine months ended September 30, 1999. See "Where You Can Find
More Information."
<TABLE>
<CAPTION>
AT SEPTEMBER 30, AT DECEMBER 31,
----------------------- ----------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
BALANCE SHEET DATA: ---------- ---------- ---------- ---------- ---------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
Total assets............................... $1,565,400 $1,514,730 $1,575,069 $1,370,007 $1,092,793 $987,589 $929,194
Loans, net of unearned discount............ 1,019,295 909,284 941,112 828,132 695,406 628,141 590,689
Securities held to maturity................ 233,565 308,743 284,944 308,112 290,894 226,896 256,785
Securities available for sale.............. 201,640 200,916 195,199 131,842 26,449 32,628 4,250
Total deposits............................. 1,066,656 986,332 1,043,317 988,148 918,572 871,085 796,612
FHLB borrowings............................ 265,224 301,224 313,724 206,724 78,000 20,000 25,000
Stockholders' equity....................... 94,086 96,291 95,848 92,493 81,110 72,572 64,202
</TABLE>
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31,
----------------------- ----------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
OPERATIONS DATA: ---------- ---------- ---------- ---------- ---------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
Interest income............................ $ 83,386 $ 80,818 $ 108,712 $ 93,820 $ 77,424 $ 72,918 $ 63,540
Interest expense........................... 37,620 36,480 49,569 41,578 32,354 29,143 22,029
---------- ---------- ---------- ---------- ---------- -------- --------
Net interest income........................ 45,766 44,338 59,143 52,242 45,070 43,775 41,511
Provision for possible loan losses......... 2,945 2,721 3,960 2,260 1,750 1,000 801
---------- ---------- ---------- ---------- ---------- -------- --------
Net interest income after provision for
loan losses.............................. 42,821 41,617 55,183 49,982 43,320 42,775 40,710
Non-interest income........................ 10,907 9,745 13,125 11,742 11,381 10,341 10,005
Non-interest expenses...................... 33,918 31,828 41,697 38,595 36,951 38,000 41,069
Minority interest expense.................. 2,001 2,001 2,668 1,645 -- -- --
---------- ---------- ---------- ---------- ---------- -------- --------
Income before income taxes................. 17,809 17,533 23,943 21,484 17,750 15,116 9,646
Income taxes............................... 5,423 5,785 7,804 7,326 6,153 4,729 1,533
---------- ---------- ---------- ---------- ---------- -------- --------
Net income................................. $ 12,386 $ 11,748 $ 16,139 $ 14,158 $ 11,597 $ 10,387 $ 8,113
========== ========== ========== ========== ========== ======== ========
PER SHARE DATA:
Net income:
Basic.................................... $ 0.87 $ 0.79 $ 1.10 $ 0.97 $ 0.80 $ 0.72 $ 0.56
Diluted.................................. 0.86 0.78 1.08 0.95 0.79 0.71 0.56
Cash dividends............................. 0.30 0.30 0.40 0.34 0.25 0.18 0.08
Book value, end of period.................. 6.71 6.59 6.63 6.25 5.55 5.00 4.45
</TABLE>
<TABLE>
<CAPTION>
AT OR FOR THE
NINE MONTHS ENDED
SEPTEMBER 30, AT OR FOR THE YEAR ENDED DECEMBER 31,
----------------------- ----------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
SELECTED FINANCIAL RATIOS(1): ---------- ---------- ---------- ---------- ---------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
Return on average assets................... 1.06% 1.11% 1.12% 1.15% 1.13% 1.10% 0.94%
Return on average equity................... 17.28 16.20 16.71 16.45 15.20 15.28 13.36
Net interest margin........................ 4.25 4.44 4.36 4.52 4.72 4.97 5.19
Operating expenses as a percent of average
assets................................... 2.90 3.01 2.88 3.14 3.60 4.02 4.75
Nonperforming loans as a percent of gross
loans.................................... 0.38 0.60 0.56 0.69 0.63 0.83 1.31
Nonperforming assets as a percent of total
assets at end of period.................. 0.26 0.37 0.34 0.43 0.43 0.60 1.26
Reserve for possible loan losses as a
percent of loans, net of unearned
discount................................. 1.44 1.50 1.46 1.53 1.76 1.92 2.32
Reserve for possible loan losses as a
percent of nonperforming loans at end of
period................................... 372.89 242.94 255.69 215.14 273.89 229.33 174.45
Dividend payout ratio...................... 34.88 37.97 37.03 35.78 31.64 25.35 14.28
Capital ratios at end of period:
Tier 1 leverage capital ratio............ 7.93 8.13 7.91 8.64 7.35 7.24 6.76
Tier 1 risk-based capital ratio.......... 10.77 11.81 11.38 13.52 10.89 10.67 10.05
Total risk-based capital ratio........... 12.03 13.06 12.63 14.78 12.15 11.92 11.31
Ratio of earnings to fixed charges(2):
Including interest on deposits............. 1.47x 1.47x 1.48x 1.51x 1.54x 1.51x 1.43x
Excluding interest on deposits............. 2.18x 2.31x 2.27x 3.02x 4.26x 5.00x 5.66x
</TABLE>
- ------------------------------
(1) With the exception of end-of-period ratios, all ratios are based on average
daily balances during the indicated periods.
(2) See "Ratios of Earnings to Fixed Charges."
8
<PAGE>
RISK FACTORS
YOU SHOULD CAREFULLY READ THE FOLLOWING RISK FACTORS BEFORE YOU DECIDE TO
BUY ANY TRUST PREFERRED SECURITIES. YOU SHOULD ALSO CONSIDER THE OTHER
INFORMATION IN THIS PROSPECTUS AND THE DOCUMENTS THAT ARE INCORPORATED BY
REFERENCE.
RISKS RELATED TO AN INVESTMENT IN THE TRUST PREFERRED SECURITIES
PAYMENTS ON THE TRUST PREFERRED SECURITIES ARE ENTIRELY DEPENDENT ON OUR MAKING
PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES; THE GUARANTEE COVERS PAYMENTS
ONLY IF THE TRUST HAS CASH AVAILABLE.
The Trust's ability to timely pay distributions (including the $10 per Trust
Preferred Security liquidation distribution) is entirely dependent on our making
the related payments on the Junior Subordinated Debentures when due. If we do
not make payments on the Junior Subordinated Debentures, the Trust will not have
sufficient funds to pay distributions or the $10 per Trust Preferred Security
liquidation amount. Because the Guarantee does not cover payments when the Trust
does not have sufficient funds, you will not be able to rely upon the Guarantee
for payment of these amounts. Instead, you may directly sue us or seek other
remedies to collect your pro rata share of payments owed or rely on the property
trustee to enforce the Trust's rights under the Junior Subordinated Debentures
directly against us.
THE TRUST'S ABILITY TO MAKE PAYMENTS ON THE TRUST PREFERRED SECURITIES DEPENDS
ON OUR ABILITY TO MAKE PAYMENTS ON THE JUNIOR SUBORDINATED DEBENTURES.
The Junior Subordinated Debentures and the Guarantee will be exclusively our
obligations. We are a bank holding company regulated by the Board of Governors
of the Federal Reserve System and substantially all of our assets are held by
our subsidiaries. Our ability to make payments on the Junior Subordinated
Debentures depends primarily on the results of operations of our subsidiaries
and their ability to provide funds to us. Our subsidiaries are separate and
distinct legal entities and have no obligations to pay any amounts due under the
Junior Subordinated Debentures or to make funds available, whether by dividend,
loan or otherwise, for such purpose. In addition, there are various legal
limitations on the extent to which certain of our subsidiaries may extend
credit, pay dividends or otherwise supply funds to, or engage in transactions
with, us or some of our subsidiaries. The Trust will be unable to make payments
to you if we do not receive funds from our subsidiaries which allow us to pay
interest on or principal of the Junior Subordinated Debentures.
Our right to participate in any distribution of the assets of any
subsidiary, including the Bank, upon a subsidiary's liquidation or
reorganization or otherwise, is subject to the prior claims of creditors of that
subsidiary, except to the extent that we may be recognized as a creditor of that
subsidiary. As a consequence, the Junior Subordinated Debentures and the
Guarantee will be effectively subordinated to all existing and future
liabilities of our subsidiaries. As of September 30, 1999, our subsidiaries had
total liabilities (excluding liabilities owed to us) of $1.5 billion. Holders of
the Junior Subordinated Debentures and beneficiaries of the Guarantee should
look only to our assets for payments on the Junior Subordinated Debentures or
under the Guarantee, as the case may be. There is no limit under the Trust
Preferred Securities, the Junior Subordinated Debentures or the Guarantee as to
our subsidiaries' ability to incur additional indebtedness.
OUR OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR SUBORDINATED DEBENTURES WILL
BE SUBORDINATED IN RIGHT OF PAYMENT TO OUR CURRENT AND FUTURE SENIOR AND
SUBORDINATED INDEBTEDNESS.
Our obligations under the Guarantee are unsecured and will rank in priority
of payment:
- junior to all of our indebtedness, except for those liabilities made equal
or subordinate to the Guarantee by their terms;
9
<PAGE>
- equal to all other guarantees issued or to be issued by us with respect to
other similar trust preferred securities, including the issuance of
$28.75 million of trust preferred securities of Trust I in May 1997; and
- senior to our capital stock.
This means that we cannot make any payments on the Guarantee if we default
on a payment of any of our other liabilities, except those liabilities made
equal with or subordinate to the Guarantee by their terms. In the event of our
bankruptcy, liquidation or dissolution, our assets would be available to pay
obligations under the Guarantee only after all payments have been made on our
other liabilities, except those liabilities made equal with or subordinate to
the Guarantee by their terms.
Our obligations under the Junior Subordinated Debentures are unsecured and
will rank junior in priority of payment to our current and future senior and
subordinated indebtedness, and will be effectively subordinated to all existing
and future liabilities and obligations of our subsidiaries, including the Bank.
This means that we cannot make any payments of principal (including redemption
payments) or interest on the Junior Subordinated Debentures if we default on a
payment on any of our senior indebtedness or subordinated indebtedness. In the
event of our bankruptcy, liquidation or distribution, our assets would be
available to pay obligations under the Junior Subordinated Debentures only after
all payments have been made on our senior indebtedness and our subordinated
indebtedness. As of September 30, 1999, we had no senior or subordinated
indebtedness outstanding and our subsidiaries had total liabilities (excluding
liabilities owed to us) of $1.5 billion. There is no limit under the Trust
Preferred Securities, the Junior Subordinated Debentures or the Guarantee as to
our ability to incur additional indebtedness, including indebtedness that ranks
senior in priority of payment to the Junior Subordinated Debentures and the
Guarantee.
OUR ABILITY TO DEFER INTEREST PAYMENTS HAS ADVERSE TAX CONSEQUENCES FOR YOU AND
MAY AFFECT THE TRADING PRICE FOR THE TRUST PREFERRED SECURITIES.
So long as no event of default under the Junior Subordinated Debentures has
occurred and is continuing, we may defer interest payments one or more times on
the Junior Subordinated Debentures for up to 20 consecutive calendar quarters,
but not beyond the maturity date of the Junior Subordinated Debentures.
If we defer interest payments on the Junior Subordinated Debentures, the
Trust will also defer distributions on the Trust Preferred Securities. During a
deferral period, you will be required to accrue income (in the form of original
issue discount) for United States federal income tax purposes equal to the
interest that accrues on your pro-rata share of the Junior Subordinated
Debentures held by the Trust. As a result, you must include the accrued but
unpaid income in your gross income for United States federal income tax purposes
before you receive cash, even if you are a cash basis taxpayer. You will also
not receive the cash related to any accrued and unpaid interest from the Trust
if you sell the Trust Preferred Securities before the end of any deferral
period. The Trust Preferred Securities may trade at a price that does not fully
reflect the value of accrued but unpaid interest on the Junior Subordinated
Debentures.
During a deferral period, your tax basis in the Trust Preferred Securities
will increase by the amount of accrued but unpaid distributions. If you sell the
Trust Preferred Securities during a deferral period, your increased tax basis
will decrease the amount of any capital gain or increase the amount of any
capital loss that you may have otherwise realized on the sale. A capital loss,
except in certain limited circumstances, cannot be applied to offset ordinary
income. As a result, deferral of distributions could result in ordinary income,
and a related tax liability for the holder, and a capital loss that may only be
used to offset a capital gain.
We do not currently intend to exercise our right to defer interest payments
on the Junior Subordinated Debentures. However, if we exercise our right in the
future, we expect that the market
10
<PAGE>
price of the Trust Preferred Securities would be adversely affected. If you sell
the Trust Preferred Securities during a deferral period, you may not receive the
same return on your investment as someone who continues to hold the Trust
Preferred Securities.
WE MAY REDEEM THE TRUST PREFERRED SECURITIES AT ANY TIME UPON THE OCCURRENCE OF
A SPECIAL EVENT.
At any time that a Special Event occurs and continues, we may redeem all of
the Junior Subordinated Debentures. A Special Event means a Tax Event, an
Investment Company Event or a Regulatory Capital Event and is more fully
described under "Description of Trust Preferred Securities--Redemption" and
defined under "Description of Trust Preferred Securities--Definitions." If there
is a Special Event and we redeem the Junior Subordinated Debentures, the Trust
must redeem the Trust Preferred Securities within 90 days at a redemption price
equal to the liquidation amount of $10 per Trust Preferred Security, plus
accrued and unpaid distributions. We may exercise this right only if we receive
any required approval by the regulatory agencies which supervise us.
WE MAY REDEEM SOME OR ALL OF THE JUNIOR SUBORDINATED DEBENTURES ON OR AFTER
, 2004, WHICH WILL CAUSE THE TRUST TO REDEEM SOME OR ALL OF THE
TRUST PREFERRED SECURITIES.
We may redeem some or all of the Junior Subordinated Debentures on or after
, 2004, which will cause the Trust Preferred Securities to be redeemed on
that date. You should assume that we will exercise our redemption option if we
are able to refinance our obligations at a lower interest rate or if it is
otherwise in our interest to redeem the Junior Subordinated Debentures. If less
than all of the Junior Subordinated Debentures are redeemed, the Trust must
redeem an amount of Trust Preferred Securities having an aggregate liquidation
value equal to the principal amount of the Junior Subordinated Debentures that
have been redeemed. We can exercise this right only if we receive any required
approval by the regulatory agencies which supervise us.
DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBENTURES COULD ADVERSELY AFFECT THE
MARKET PRICE FOR THE TRUST PREFERRED SECURITIES AND HAVE TAX CONSEQUENCES FOR
YOU.
We may dissolve the Trust at any time before the maturity of the Junior
Subordinated Debentures on , 2029. As a result, and subject to the
terms of the Trust Agreement, the Trustees may distribute the Junior
Subordinated Debentures to the holders of Trust Preferred Securities. Although
we have agreed to use our best efforts to list the Junior Subordinated
Debentures on a national securities exchange or comparable automated quotation
system if this occurs, there can be no assurance that the Junior Subordinated
Debentures will be approved for listing or that a trading market will exist for
the Junior Subordinated Debentures.
We cannot predict the market prices for the Junior Subordinated Debentures
that may be distributed. Accordingly, the Junior Subordinated Debentures that
you receive upon a distribution, or the Trust Preferred Securities you hold
pending such a distribution, may trade at a price that is less than the price
you paid to purchase the Trust Preferred Securities. Because you may receive
Junior Subordinated Debentures, you must also make an investment decision with
regard to the Junior Subordinated Debentures. You should carefully review all
the information regarding the Junior Subordinated Debentures contained in this
prospectus.
Under current United States federal income tax laws, a distribution of the
Junior Subordinated Debentures to you upon the dissolution of the Trust would
not be a taxable event to you. Nevertheless, if the Trust is classified for
United States federal income tax purposes as an association taxable as a
corporation at the time it is dissolved, the distribution of the Junior
Subordinated Debentures would be a taxable event to you. In addition, if there
is a change in law, a distribution of the Junior Subordinated Debentures upon
the dissolution of the Trust could be a taxable event to you.
11
<PAGE>
THE HOLDERS OF THE TRUST PREFERRED SECURITIES AND THE JUNIOR SUBORDINATED
DEBENTURES ARE NOT PROTECTED BY COVENANTS IN THE INDENTURE OR THE TRUST
AGREEMENT.
Neither the Indenture, which sets forth the terms of the Junior Subordinated
Debentures, nor the Trust Agreement, which sets forth the terms of the Trust
Securities, protects holders of Junior Subordinated Debentures, or Trust
Preferred Securities, respectively, in the event we experience significant
adverse changes in our financial condition or results of operations. In
addition, neither the Indenture nor the Trust Agreement limits our ability or
the ability of our subsidiaries to incur additional indebtedness, including
indebtedness that ranks senior to the Junior Subordinated Debentures and the
Guarantee. Therefore, the provisions of these governing instruments should not
be considered a significant factor in evaluating whether we will be able to
comply with our obligations under the Junior Subordinated Debentures or the
Guarantee.
YOU WILL HAVE LIMITED VOTING RIGHTS.
As a holder of Trust Preferred Securities, you will have limited voting
rights. Your voting rights will relate only to the modification of the Trust
Preferred Securities and the exercise of the Trust's rights as holder of the
Junior Subordinated Debentures. In general, only we can replace or remove any of
the Trustees. The property trustee, the administrative trustees and we may amend
the Trust Agreement without your consent for certain things, including to ensure
that the Trust will be classified for United States federal income tax purposes
as a grantor trust. You also will have no voting rights on matters submitted to
a vote of our stockholders. However, if an event of default under the Trust
Agreement occurs and is continuing, the holders of at least a majority in
aggregate liquidation amount of the Trust Preferred Securities may replace the
property trustee and the Delaware trustee.
POTENTIAL TAX LAW CHANGES COULD REQUIRE US TO REDEEM THE TRUST PREFERRED
SECURITIES.
From time to time, certain tax law changes have been proposed that would
deny interest deductions to corporate issuers of debt instruments with terms
that include certain of the terms of the Junior Subordinated Debentures. In
addition, the Internal Revenue Service ("IRS") has in the past challenged
taxpayers' treatment as indebtedness of securities issued with characteristics
similar to the Junior Subordinated Debentures. To date, such tax law change
proposals have not been enacted and the only known challenge that has advanced
as far as litigation was settled short of trial, with resolution favorable to
the taxpayer's position. However, if any similar tax law change were enacted or
any such challenge by the IRS were upheld, such event could give rise to a Tax
Event (as defined under "Description of Trust Preferred Securities--Redemption")
which could result in an early redemption of the Trust Preferred Securities.
THERE MAY BE NO ACTIVE OR LIQUID MARKET FOR THE TRUST PREFERRED SECURITIES.
Before this offering, there has been no market for the Trust Preferred
Securities. We plan to have the Trust Preferred Securities quoted on the Nasdaq
National Market. We cannot predict whether an active and liquid trading market
for the Trust Preferred Securities will develop or whether a continued quotation
of the Trust Preferred Securities will be available on the Nasdaq National
Market. Although the underwriter has informed the Trust and us that it intends
to make a market in the Trust Preferred Securities, the underwriter is not
obligated to do so and any such market-making activity may be terminated at any
time without notice. Future trading prices of the Trust Preferred Securities
will depend on many factors including, among other things, prevailing interest
rates, our operating results and financial condition, and the market for similar
securities. Our 9.28% cumulative trust preferred securities issued by Trust I in
May 1997 are quoted on the Nasdaq National Market under the symbol "INDBP."
12
<PAGE>
RISKS RELATING TO OUR COMPANY
CHANGES IN INTEREST RATES COULD REDUCE OUR PROFITABILITY.
Our ability to make a profit, like that of most financial institutions,
substantially depends upon our net interest income, which is the difference
between the interest income we earn on our interest-earning assets (such as
loans and investment securities) and the interest expense we pay on our
interest-bearing liabilities (such as deposits and borrowings). Certain assets
and liabilities, however, may react in different degrees to changes in market
interest rates. Further, interest rates on some types of assets and liabilities
may fluctuate prior to changes in broader market interest rates, while rates on
other types may lag behind. Additionally, some of our assets, such as
adjustable-rate mortgages, have features, including payment and rate caps, which
restrict changes in their interest rates.
Factors such as inflation, recession, unemployment, money supply,
international disorders, instability in domestic and foreign financial markets,
and other factors beyond our control may affect interest rates. Changes in
market interest rates will also affect the level of voluntary prepayments on our
loans and the receipt of payments on our mortgage-backed securities resulting in
the receipt of proceeds that may be reinvested at a lower rate than the loan or
mortgage-backed security being prepaid. Although we pursue an asset-liability
management strategy designed to control our risk from changes in market interest
rates, changes in interest rates can still have a material adverse effect on our
profitability.
OUR ALLOWANCE FOR LOAN LOSSES MAY BE INADEQUATE TO COVER LOSSES ACTUALLY
INCURRED, WHICH COULD AFFECT OUR ABILITY TO MAKE PAYMENTS ON THE JUNIOR
SUBORDINATED DEBENTURES.
We maintain an allowance for loan losses in an amount we believe is
sufficient to provide for known and inherent risks in our loan portfolio. If the
Bank incurs actual losses on its loans in excess of its allowance for loan
losses, it may have insufficient income to extend credit, pay dividends or
otherwise supply funds to us. If this occurs, we may be unable to make payments
of interest and principal on the Junior Subordinated Debentures, and the Trust
may be unable to make payments of interest and principal to you.
A SIGNIFICANT AMOUNT OF OUR LOANS ARE CONCENTRATED IN MASSACHUSETTS, AND ADVERSE
CONDITIONS IN MASSACHUSETTS COULD NEGATIVELY IMPACT OUR OPERATIONS.
Substantially all of the loans we originate are secured by properties
located in or are made to businesses which operate in Massachusetts. Because of
the current concentration of our loan origination activities in Massachusetts,
in the event of adverse economic conditions in Massachusetts, we would likely
experience higher rates of loss and delinquency on our loans than if our loans
were more geographically diversified. Additionally, our loans may be subject to
a greater risk of default than other comparable loans in the event of adverse
economic, political or business developments or natural hazards that may affect
Massachusetts and the ability of property owners in Massachusetts to make
payments of principal and interest on the underlying loans, which could have an
adverse effect on our results of operations or financial condition.
COMPETITION WITH OTHER FINANCIAL INSTITUTIONS COULD ADVERSELY AFFECT OUR
PROFITABILITY.
We face substantial competition in originating loans and in attracting
deposits. This competition in originating loans comes principally from other
banks, other savings institutions, mortgage banking companies, consumer finance
companies, insurance companies and other institutional lenders and purchasers of
loans. In attracting deposits, we compete with insured depository institutions
such as banks, savings institutions and credit unions, as well as institutions
offering uninsured investment alternatives including money market funds. These
competitors may offer higher interest rates than we do, which could result in
either our attracting fewer deposits or in our being required to increase our
rates in order to attract deposits. Increased deposit competition could increase
our cost of funds and
13
<PAGE>
adversely affect our ability to generate the funds necessary for our lending
operations, thereby adversely affecting our results of operations. A number of
institutions with which we compete have significantly greater assets, capital
and other resources. In addition, many of our competitors are not subject to the
same extensive federal regulation that governs our business. As a result, many
of our competitors have advantages over us in conducting certain businesses and
providing certain services.
OUR FUTURE PROFITS WILL BE AFFECTED BY OUR ABILITY TO SUCCESSFULLY INTEGRATE THE
NEW BRANCHES TO BE ACQUIRED FROM FLEET FINANCIAL GROUP, INC.
We have agreed, subject to regulatory approval, to acquire 12 branches, two
of which are located in Brockton, Massachusetts, which is within our primary
market area, and ten of which are located on Cape Cod, Massachusetts in
Barnstable County, a market contiguous to where we presently operate. In
connection with the acquisition, we will acquire approximately $269 million of
deposits and $150 million of commercial and consumer loans. Our future profits
will be affected by our ability to retain the acquired deposits, to generate
revenues from the new branch locations as well as the loans we are acquiring, to
manage the costs associated with the acquired branch offices and to otherwise
successfully integrate the new branches into our operations.
IF OUR COMPUTER SYSTEMS DO NOT PROPERLY WORK ON JANUARY 1, 2000, OUR BUSINESS
OPERATIONS COULD BE DISRUPTED.
The Year 2000 issue is the result of computer programs being able to use
only two digits rather than four to define the applicable year. Thus,
date-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in system failures or miscalculations,
causing disruptions of operations, including, among others, a temporary
inability to process deposit and loan transactions, effect financings or engage
in normal business activities. We have established programs to prepare our
computer systems and applications for the Year 2000 and we are utilizing both
internal and external resources to identify, correct and test our systems for
Year 2000 compliance.
All financial institutions are heavily dependent on technology and the
services of third party vendors in the delivery of products and services. An
interruption in these services would severely hamper our ability to provide
products and services to our customers. For example, without telephone, power,
or mainframe computer access in 2000, we would have to resort to manual
processing in order to serve customers. This type of scenario could not continue
indefinitely without severe erosion in service levels and consequently earnings.
In 1997, we converted our core operating system software to a leading provider
of data processing services, Alltel. As a consequence, Alltel is leading the
company's effort for ensuring Year 2000 compliance for all mainframe application
software. Management has overall responsibility for ensuring compliant systems
and is working closely with Alltel to ensure compliance by December 31, 1999.
Costs related to this aspect of the Year 2000 effort are the responsibility of
Alltel.
An additional type of risk that banks face is customer risk. Specifically,
large corporate borrowers face many of the Year 2000 issues that the Bank faces.
To the extent that many of these issues are not resolved and the viability of
the borrower organization is compromised, a credit risk issue could be created
for the Bank. Management continues to monitor and manage the customer risk posed
in this type of scenario.
Bank regulatory agencies have issued guidance as to the standards they will
use when assessing Year 2000 readiness. The failure of a financial institution,
such as ourselves, to take appropriate steps to address deficiencies in its Year
2000 project management process may result in regulatory enforcement actions
which could have material adverse effect on the institution, result in the
imposition of civil money penalties, or result in the delay (or receipt of an
unfavorable or critical evaluation of the management of a financial institution
in connection with regulatory review) of applications seeking to acquire other
entities or otherwise expand the institution's activities.
14
<PAGE>
CHANGES IN STATUTES AND REGULATIONS COULD ADVERSELY AFFECT US.
We are subject to extensive regulation and supervision by federal and state
authorities. Such supervision and regulation establish a comprehensive framework
of activities in which an institution may engage, and are intended primarily for
the protection of the federal deposit insurance fund and the Bank's depositors.
This regulatory structure also provides our regulators with significant
discretion in the performance of their supervisory and enforcement duties. Any
change in such regulation, whether by our regulators or as a result of
legislation subsequently enacted by the Congress of the United States, could
have a substantial impact on the Bank and its operations. Additional legislation
and regulations may be enacted or adopted in the future that could significantly
affect our powers, authority and operations, which could have a material adverse
effect on our operations.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth our consolidated ratios of earnings to fixed
charges for the respective periods indicated.
<TABLE>
<CAPTION>
NINE MONTHS
ENDED YEARS ENDED DECEMBER 31,
SEPTEMBER 30, --------------------------------------------------------
1999 1998 1997 1996 1995 1994
------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Ratios of earnings to fixed charges:
Including interest on deposits................. 1.47x 1.48x 1.51x 1.54x 1.51x 1.43x
Excluding interest on deposits................. 2.18x 2.27x 3.02x 4.26x 5.00x 5.66x
</TABLE>
For purposes of computing the ratios of earnings to fixed charges, earnings
represent income before extraordinary items and cumulative effect of changes in
accounting principles plus applicable income taxes and fixed charges. Fixed
charges includes 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.
USE OF PROCEEDS
All of the proceeds from the sale of the Trust Preferred Securities together
with proceeds of the Common Securities will be invested by the Trust in the
Junior Subordinated Debentures to be issued by us. We intend to use the
estimated net proceeds from the sale of the Junior Subordinated Debentures of
approximately $ million ($ million if the underwriter's
over-allotment option is exercised in full) for general corporate purposes,
including capital contributions to the Bank, and for working capital. To the
extent that the previously announced branch acquisition transaction with Fleet
Financial Group, Inc. is completed, the offering will ensure that the Bank will
continue to be "well capitalized" following consummation of the transaction. See
"Summary--Our Company." Initially, the net proceeds may be used to make
short-term investments.
15
<PAGE>
CAPITALIZATION
The following table sets forth our unaudited consolidated capitalization as
of September 30, 1999 and such capitalization as adjusted, to reflect the sale
of the Trust Preferred Securities, the issuance of the Junior Subordinated
Debentures and the application of the estimated net proceeds as described in
"Use of Proceeds." You should also read the more detailed information included
or incorporated by reference in this prospectus, including the financial
statements and related notes.
<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
------------------------
ACTUAL AS ADJUSTED
---------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Company-obligated mandatorily redeemable 9.28% trust
preferred securities of Independent Capital Trust I due
May 19, 2027.............................................. $ 28,750 $28,750
Company-obligated mandatorily redeemable % trust preferred
securities of Independent Capital Trust II due ,
2029(1)................................................... --
---------- -------
Stockholders' equity:
Preferred stock, $0.01 par share, 1,000,000 shares
authorized; none issued................................. -- --
Common stock, par value $0.01, 30,000,000 shares
authorized, 14,863,821 shares issued.................... 149 149
Surplus................................................... 45,024 45,024
Retained earnings......................................... 64,329 64,329
Treasury stock, 854,893 shares............................ (11,628) (11,628)
Transitional unrealized loss on common stock shares held
in rabbi trust.......................................... (1,312) (1,312)
Accumulated other comprehensive income.................... (2,476) (2,476)
---------- -------
Total stockholders' equity.................................. $ 94,086 $94,086
---------- -------
Total liabilities, minority interest in subsidiaries and
stockholders' equity...................................... $1,565,400 $
========== =======
</TABLE>
- ------------------------
(1) The sole assets of the Trust, which is our subsidiary, will be the Junior
Subordinated Debentures which will mature on , 2029. We will own
all of the Common Securities issued by the Trust.
16
<PAGE>
INDEPENDENT CAPITAL TRUST II
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
will be governed by the terms of the Amended and Restated Declaration of Trust
of the Trust (the "Trust Agreement") which will be qualified under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). 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 other activities that are
incidental or necessary to these purposes. 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 us. We will acquire Common
Securities with a $10 liquidation amount, equal to at least 3% of the total
capital of the Trust. While the Common Securities will have terms equal in
priority of payment with the Trust Preferred Securities, if we default on the
Junior Subordinated Debentures, then cash distributions and liquidation,
redemption and other amounts payable on the Common Securities will be
subordinated to the Trust Preferred Securities in priority of payment.
The Trust has a term of approximately 31 years, but may be dissolved earlier
as provided in the Trust Agreement. The Trust's business and affairs are
conducted by the Issuer Trustees, who are appointed by us as holder of the
Common Securities. The trustees for the Trust will be The Bank of New York, as
the Property Trustee (the "Property Trustee"), The Bank of New York (Delaware),
as the Delaware Trustee (the "Delaware Trustee") and three Administrative
Trustees who are our officers (each, an "Administrative Trustee" and
collectively, the "Administrative Trustees"). The Property Trustee, the Delaware
Trustee and the Administrative Trustees are collectively referred to as the
"Issuer Trustees" in this prospectus. The Property Trustee will act as sole
indenture trustee under the Trust Agreement. The Bank of New York will also act
as trustee under the Guarantee and the Indenture. The duties and obligations of
each Issuer Trustee are governed by the Trust Agreement. 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, whose
voting rights will be vested exclusively in the holder of the Common Securities.
We will pay all fees, expenses, debts and obligations related to the Trust
and the offering of the Trust Preferred Securities and will pay, directly or
indirectly, all ongoing costs and expenses of the Trust, except the Trust's
obligations with respect to the Trust Preferred Securities and the Common
Securities.
For financial reporting purposes, the Trust will be treated as our
subsidiary and, accordingly, the accounts of the Trust will be included in our
Consolidated Financial Statements. We will present the Trust Preferred
Securities as a separate line item in our consolidated Statement of Financial
Condition entitled "Company-Obligated Mandatorily Redeemable Trust Preferred
Securities of Subsidiary Trust Holding Solely Junior Subordinated Debentures of
the Company" and we will include appropriate disclosures about the Trust
Preferred Securities, the Guarantee and the Junior Subordinated Debentures in
the notes to our Consolidated Financial Statements. For financial reporting
purposes, we will record distributions payable on the Trust Preferred Securities
as "minority interest income of subsidiaries" in our Consolidated Statements of
Operations. We treat the 9.28% trust preferred securities issued by Trust I in
May 1997 and the related junior subordinated debentures in the same manner.
17
<PAGE>
DESCRIPTION OF TRUST PREFERRED SECURITIES
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. The
Trust Agreement will be qualified under the Trust Indenture Act. The Property
Trustee will act as the indenture trustee (the "Debenture Trustee") for purposes
of complying with the Trust Indenture Act.
GENERAL
The Administrative Trustees will issue the Trust Preferred Securities on
behalf of the Trust pursuant to the terms of the Trust Agreement. We will own
all of the Common Securities. The Trust Preferred Securities will represent
preferred undivided beneficial interests in the assets of the Trust and the
holders of the Trust Preferred Securities will be entitled to a preference in
certain circumstances with respect to Distributions (as defined below) 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
prohibits 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 equal in priority of payment, and
payments will be made thereon PRO RATA with the Common Securities except under
certain circumstances. See "--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.
DISTRIBUTIONS
PAYMENT OF DISTRIBUTIONS. Distributions on each Trust Preferred Security
will be cumulative, will accrue from , 1999 and will be payable
quarterly in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing , 1999, at the annual rate of % of the stated
liquidation amount of $10 per Trust Preferred Security ("Distributions"). The
initial Distribution will equal $ for each Trust Preferred
Security. Subsequent Distributions will equal $ for each Trust
Preferred Security. Distributions in arrears for more than one quarter will (to
the extent permitted by law) accrue interest at the rate per annum of %
thereof compounded quarterly. Distributions shall be made 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
prior to the relevant Distribution Date (as defined below) and, in the event the
Trust Preferred Securities are not in book-entry form, will be the fifteenth day
of the month in which the relevant Distribution Date occurs. The amount of
Distributions 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
quarter, on the basis of the actual number of days elapsed in the quarter based
on 30-day months. 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 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 the next succeeding Business Day falls in the next
succeeding calendar year, the 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
18
<PAGE>
than a Saturday or a Sunday, or a day on which banking institutions in the City
of New York, New York or Rockland, Massachusetts are authorized or required by
law or executive order to close.
DEFERRAL PERIOD. So long as no Debenture Event of Default shall have
occurred and be continuing, we will have the right under the Indenture 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 calendar quarters
with respect to each deferral period (each, a "Deferral Period"), provided that
no Deferral Period shall end on a date other than an Interest Payment Date (as
defined herein) or extend beyond , 2029, which is the "Stated Maturity
Date." Upon any such election, quarterly Distributions on the Trust Preferred
Securities will be deferred by the Trust during such Deferral Period.
Distributions to which holders of the Trust Preferred Securities are entitled
during any such Deferral 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, includes any such
additional Distributions.
Prior to the termination of any Deferral Period, we may further extend the
Deferral Period, provided that an extension will only be permitted under the
Trust Agreement to the extent that the Deferral Period, together with all other
extensions occurring both before and after such extension, does not exceed 20
consecutive calendar quarters, end on a date other than an Interest Payment Date
or extend beyond the Stated Maturity Date. Upon the termination of any such
Deferral Period and the payment of all amounts then due on any Interest Payment
Date, we may elect to begin a new Deferral Period, subject to the above
requirements. No interest shall be due and payable during a Deferral Period,
except at the end of the period. If Distributions are deferred, the deferred
Distributions and accrued interest will be paid to holders of the Trust
Preferred Securities as they appear on the books and records of the Trust on the
record date for Distributions due at the end of the Deferral Period. We must
give the Property Trustee, the Administrative Trustees and the Debenture Trustee
notice of our election of any such Deferral 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 Deferral 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 we may elect to begin a Deferral Period.
During any such Deferral Period, we may not
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of our capital
stock;
- make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any of our debt securities (including any other
debentures related to other trust preferred securities ("Other
Debentures")) that rank equal with or junior in right of payment to the
Junior Subordinated Debentures; or
- make any guarantee payments with respect to any guarantee made by us of
the debt securities of any of our subsidiaries (including other guarantees
of trust preferred securities) if such guarantee ranks equal with or
junior in right of payment to the Junior Subordinated Debentures.
However, we will not violate the first bullet point above if we
- declare or pay dividends or make distributions in shares of, or options,
warrants or rights to subscribe for or purchase shares of, our common
stock;
19
<PAGE>
- declare a dividend in connection with the implementation of a
stockholders' rights plan, or issue stock under any such plan in the
future, or redeem or repurchase of any such rights pursuant to any such
plan;
- make payments under the Guarantee;
- purchase any fractional shares as a result of a reclassification of our
capital stock;
- purchase any fractional interests in shares of our capital stock pursuant
to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged therefor; or
- purchase common stock as a result of the issuance of common stock or
rights under any of our benefit plans for directors, officers or employees
or any of our dividend reinvestment plans.
We do not currently intend to exercise our option to defer payments of
interest on the Junior Subordinated Debentures.
SOURCE OF DISTRIBUTION. The Trust's funds available for distribution to
holders of the Trust Preferred Securities will be limited to payments under the
Junior Subordinated Debentures. If we do 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 us on a
limited basis.
REDEMPTION
MANDATORY REDEMPTION OF THE TRUST PREFERRED SECURITIES. Upon the repayment
or redemption at any time, in whole or in part, of any Junior Subordinated
Debentures, the proceeds from such repayment or redemption will 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 $10 per Trust
Preferred Security plus any accrued and unpaid Distributions thereon to the
Redemption Date. If less than all of the Junior Subordinated Debentures are to
be prepaid on a Redemption Date, then the proceeds of such prepayment will be
allocated PRO RATA to the Preferred and Common Trust Securities, as described
below.
OPTIONAL REDEMPTION OF THE JUNIOR SUBORDINATED DEBENTURES. On or after
, 2004, we will have the right to redeem the Junior Subordinated
Debentures in whole at any time or in part from time to time at a redemption
price equal to 100% of the principal amount thereof plus accrued and unpaid
interest on the Junior Subordinated Debentures so redeemed to the date fixed for
redemption. We would redeem the Junior Subordinated Debentures upon not less
than 30 nor more than 60 days written notice, in each case subject to receipt of
prior approval if it is then required under applicable regulatory requirements.
If we redeem the Junior Subordinated Debentures, the Trust Securities will be
redeemed as described in the preceding paragraph.
SPECIAL EVENT OR DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES. If a
Special Event (as defined below) occurs and is continuing, we will have the
right upon not less than 30 nor more than 60 days written notice 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 if it is then required under
applicable regulatory requirements. If a Special Event has occurred and is
continuing and we do not elect to redeem the Junior Subordinated Debentures (and
thereby cause a mandatory redemption of the Trust Securities) or to dissolve the
Trust and, after satisfaction of creditors as required by applicable law, cause
the Junior Subordinated Debentures to be
20
<PAGE>
distributed to holders of the Trust Securities, the Trust Securities will remain
outstanding and Additional Sums (as defined below) may be payable on the Junior
Subordinated Debentures.
DEFINITIONS. The terms described in the preceding paragraph have the
following meanings:
"Additional Sums" means the additional amounts as may be necessary to be
paid by us 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 will not be reduced as a result of any additional taxes, duties
and other governmental charges to which the Trust has become subject.
An "Investment Company Event" means the receipt by us 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, there is more than an insubstantial risk that the Trust is or will be
considered an "investment company" that is required to be registered under the
Investment Company Act of 1940 (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 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 Liquidation Amount of the
Trust Securities of the holders to whom such Junior Subordinated Debentures are
distributed.
"Liquidation Amount" means the stated amount of $10 per Trust Security.
A "Regulatory Capital Event" means that we 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 of the United States or any
rules, guidelines or policies of applicable regulatory agencies 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 the date of the Trust
Agreement, there is more than an insubstantial risk that the Trust Preferred
Securities do not constitute, or within 90 days of the date thereof, will not
constitute, Tier 1 Capital (or its then equivalent) for purposes of the capital
adequacy guidelines of the Board of Governors of the Federal Reserve (or any
successor regulatory authority with jurisdiction over bank holding companies),
or any capital adequacy guidelines as then in effect and applicable to us. The
distribution of the Junior Subordinated Debentures in connection with the
dissolution of the Trust by us will 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 us 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 of the United States or of any political subdivision or taxing
authority, 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 date of the Trust Agreement, 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
21
<PAGE>
Subordinated Debentures, (ii) interest payable by us on the Junior Subordinated
Debentures is not, or within 90 days of the date of such opinion will not be,
deductible by us, 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 minor amount of other taxes, duties or other
governmental charges.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
We will have the right at any time to dissolve 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. This right is
subject to (i) our 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) prior approval by the applicable regulatory authorities if
it is then required under applicable regulatory requirements.
After the 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) The Depository Trust Company ("DTC" or
"Depositary") or its nominee will receive, in respect of each registered global
certificate, if any, representing Trust Securities 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 with an interest rate identical to
the distribution rate of, and accrued and unpaid interest 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 we will issue to such holder, and the Debenture Trustee
will authenticate, a certificate representing such Junior Subordinated
Debentures.
We can give 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 you may
purchase, or the Junior Subordinated Debentures that you may receive on
dissolution and liquidation of the Trust, may trade at a discount to the price
that you paid to purchase the Trust Preferred Securities.
If the Junior Subordinated Debentures are distributed to the holders of
Trust Preferred Securities, we will use our best efforts to list the Junior
Subordinated Debentures on a national securities exchange or comparable
automated quotation system.
REDEMPTION PROCEDURES
If applicable, Trust Securities will be redeemed at the redemption price
with the proceeds from the contemporaneous repayment or redemption of the Junior
Subordinated Debentures. Any redemption of Trust Securities will 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.
The Trust may not redeem fewer than all of the outstanding Trust Preferred
Securities unless all accrued and unpaid Distributions have been paid on all
Trust Preferred Securities for all quarterly Distribution periods terminating on
or prior to the date of redemption. If a partial redemption of the Trust
Preferred Securities would result in the delisting of the Trust Preferred
Securities by a national securities exchange or other organization on which the
Trust Preferred Securities are listed, then, pursuant to the Indenture, we may
only redeem the Junior Subordinated Debentures in whole and, as a result, the
Trust may only redeem the Trust Preferred Securities in whole.
22
<PAGE>
If the Trust gives a notice of redemption in respect of the Trust Preferred
Securities (which notice will be irrevocable), then, by 12:00 noon, New York
City time, on the Redemption Date, to the extent that we have deposited with the
Property Trustee by 10:00 a.m., New York City time, funds sufficient to pay the
redemption price 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 Preferred
Securities. See "Book-Entry Issuance." If such Trust Preferred Securities are no
longer in book-entry form, the Property Trustee, to the extent we have deposited
with the Property Trustee funds sufficient to pay the redemption price, 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 we fail to repay the Junior Subordinated Debentures on maturity
or payment of the redemption price is improperly withheld or refused and not
paid either by the Trust or by us pursuant to the Guarantee as described under
"Description of Guarantee," (i) Distributions on Trust Preferred Securities will
continue to accrue 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 the Trust Agreement and applicable law (including, without
limitation, United States federal securities law), we or our 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 will 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 will be allocated PRO RATA to the Trust
Preferred Securities and Common Securities based upon the relative Liquidation
Amounts of the Trust Securities or such other method as the Trustee shall deem
appropriate, not more than 60 days prior to the date fixed for redemption. The
particular Trust Preferred Securities to be redeemed will be selected by the
Property Trustee from the outstanding Trust Preferred Securities not previously
called for redemption, by such method as the Property Trustee deems fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $10 or an integral multiple thereof) of the Liquidation Amount of
Trust Preferred Securities. The Property Trustee will 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 all
purposes of the Trust Agreement, unless the context otherwise requires, all
provisions relating to the redemption of Trust Preferred Securities shall
23
<PAGE>
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 we default 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. However, if on any Distribution Date or
Redemption Date a Debenture Event of Default (as described in "Description of
Junior Subordinated Debentures--Debenture Events 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, will 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 to the Debenture Event of
Default, 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 will 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 (as described in "--Events of Default; Notice"), as
holder of the Common Securities, we 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 has been cured, waived or otherwise eliminated. Until any such Event of
Default has been so cured, waived or otherwise eliminated, the Property Trustee
will act solely on behalf of the holders of the Trust Preferred Securities and
not on behalf of us 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 DISSOLUTION
We will have the right at any time to dissolve the Trust and cause the
Junior Subordinated Debentures to be distributed to the holders of the Trust
Preferred Securities. Our right is subject to (i) our having received an opinion
of an independent tax counsel experienced in such matters to the effect that
such distribution will not be a taxable event to holders of Trust Preferred
Securities for United States federal income tax purposes, and (ii) our having
received prior approval if it is then required under applicable regulatory
requirements. See "--Distribution of Junior Subordinated Debentures."
In addition, the Trust will automatically dissolve upon the first to occur
of: (i) certain events of our bankruptcy, dissolution or liquidation; (ii) the
distribution of a Like Amount of the Junior Subordinated Debentures to the
holders of the Trust Securities, if we have given written direction to the
Property Trustee to dissolve the Trust (which direction is optional and, except
as described above, wholly within our discretion); (iii) redemption of all of
the Trust Securities; (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.
24
<PAGE>
If a dissolution occurs as described in clause (i), (ii), (iv), or
(v) above, the Trust will be liquidated by the Administrative Trustees as
expeditiously as the Administrative Trustees determine to be possible by
distributing to the holders of the Trust Securities, after satisfaction of
liabilities to creditors of the Trust, a Like Amount of the Junior Subordinated
Debentures. However, if such a distribution is determined by the Property
Trustee not to be practicable, the holders will be entitled to receive out of
the assets of the Trust legally available for distribution, after satisfaction
of liabilities to creditors of the Trust, 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. However, if a Debenture
Event of Default has occurred and is continuing, the Trust Preferred Securities
will have a priority over the Common Securities. See "--Subordination of Common
Securities."
If we elect not to redeem the Junior Subordinated Debentures prior to
maturity in accordance with their terms and either elect not to or are 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 we elect to dissolve the Trust and thereby cause the Junior Subordinated
Debentures to be distributed to holders of the Trust Preferred Securities in
liquidation of the Trust, we shall continue to have the right to redeem the
Junior Subordinated Debentures, subject to certain conditions.
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, regardless of the
reason for such Event of Default and whether it occurs voluntary or involuntary
or by operation of law or pursuant to any order, rule or regulation:
- the occurrence of a Debenture Event of Default (see "Description of Junior
Subordinated Debentures--Debenture Events of Default");
- 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;
- default by the Trust in the payment of the redemption price of any Trust
Security when it becomes due and payable;
- 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 the second or third clause above), and continuation
of the 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
the default or breach and requiring it to be remedied and stating that the
notice is a "Notice of Default" under the Trust Agreement; or
- the occurrence of certain events of bankruptcy or insolvency with respect
to the Property Trustee and the failure by us to appoint a successor
Property Trustee within 60 days of the event.
Within 90 days after the occurrence of any Event of Default known to the
Property Trustee, the Property Trustee will transmit notice of the Event of
Default to the holders of the Trust Preferred Securities, the Administrative
Trustees and us, unless the Event of Default has been cured or waived. We and
the Administrative Trustees are required to file annually with the Property
Trustee a certificate
25
<PAGE>
as to whether or not we or 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 will have a preference over the Common Securities. See
"--Subordination of Common Securities" and "--Liquidation Distribution Upon
Default." 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 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 us (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 will 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 will 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 ("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 has occurred and is 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 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 us, as the holder of the Common Securities. No
resignation or removal of an Issuer Trustee (other than an Administrative
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 has occurred and is 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 property of the Trust may at the time be
located, we, as the holder of the Common Securities, and the Administrative
Trustees shall have the right 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
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 the 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 will have power to make the appointment.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any Person into which the Property Trustee or the Delaware Trustee that is
not a natural person may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Issuer Trustee is a party, or any Person succeeding
to all or substantially all the corporate trust business of such Issuer Trustee,
will be the successor of such Issuer Trustee under the Trust Agreement, provided
the Person shall be otherwise qualified and eligible.
26
<PAGE>
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 "--Distribution of
Junior Subordinated Debentures." The Trust may, at our request, with the consent
of the Administrative Trustees but without the consent of the holders of the
Trust Preferred Securities, the Property Trustee or the Delaware 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 under the laws of any State; provided, that (i) the
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) we
expressly appoint 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 Trust Preferred Securities or 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 the transaction,
the 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) the 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), (vi) the successor entity has a purpose substantially identical to
that of the Trust, (vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, we have received an opinion from
independent counsel to the Trust experienced in such matters to the effect that
(a) the 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), (b) following the 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, and (c) the Trust will continue to be, or the successor entity will be,
classified as a grantor trust for federal income tax purposes, (viii) we 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 Guarantee and
(ix) the Property Trustee is given an officer's certificate and an opinion of
counsel each to the effect that all conditions precedent in the Trust Agreement
to the transactions have been satisfied. Notwithstanding the foregoing, the
Trust will 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
the 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 or each holder of
the Trust Securities not to be treated as owning an undivided interest in the
Junior Subordinated Debentures.
27
<PAGE>
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 us, 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. However, the amendment to
the Trust Agreement under these circumstances may not adversely affect the
interests of the holders of the Trust Securities. Any amendments of the Trust
Agreement under these circumstances will become effective when notice is given
to the holders of the Trust Securities. The Trust Agreement may be amended by
the Administrative Trustees, the Property Trustee and us (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. However, 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 payment
on or after the specified date. Notwithstanding the foregoing, no amendments or
modification may be made to the Declaration if such amendment or modification
would (i) cause the Trust to be classified as other than a grantor trust for
United States federal income tax purposes, (ii) reduce or otherwise adversely
affect the powers of the Property Trustee in contravention of the Trust
Indenture Act or (iii) cause a Special Event.
So long as any Junior Subordinated Debentures are held by the Property
Trustee, subject to the requirement of the Property Trustee obtaining a tax
opinion in certain circumstances set forth in the last sentence of this
paragraph, 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 Debenture Trustee, or
direct the exercise of any trust or power conferred on the Property Trustee with
respect to the Junior Subordinated Debentures, including the right to direct the
Property Trustee, as holder of the Junior Subordinated Debentures, to
(i) exercise the remedies available under the Indenture with respect to the
Junior Subordinated Debentures, (ii) waive any past defaults under the Indenture
that are available 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 the
consent will be required. However, where a consent under the Indenture would
require the consent of each affected holder of Junior Subordinated Debentures,
no consent may be given by the Property Trustee without the prior approval of
each holder of the Trust Preferred Securities. The Issuer Trustees will not
revoke any action previously authorized or approved by a vote of the holders of
the Trust Preferred Securities except by subsequent vote of those holders.
28
<PAGE>
The Property Trustee will notify each holder of Trust Preferred Securities
within 90 days of any notice of default with respect to the Junior Subordinated
Debentures. In addition to obtaining the foregoing approvals of the holders of
the Trust Preferred Securities prior to taking any of the foregoing actions, the
Issuer Trustees will 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 the holders convened for that purpose or pursuant to written
consent without prior notice. The Administrative Trustees will cause a notice of
any meeting at which holders of Trust Preferred Securities are entitled to vote
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 us, the Trustees or any affiliate
of us or any Trustees, will, 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 DTC or its nominee (a "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."
A global security will 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 us that it is unwilling or unable to continue as
a depositary for the global security and no successor depositary shall have been
appointed within 90 days, 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 the global security may 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 as described in the
preceding sentence will be exchangeable for definitive certificates registered
in the names as the Depositary shall direct. We expect that the instructions
will be based upon directions received by the Depositary with respect to
ownership of beneficial interests in the global security. In the event that
Trust Preferred Securities are issued in definitive form, the Trust Preferred
Securities will be in denominations of $10 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 individual Trust
Preferred Securities, a Global Trust Preferred Security 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
or by the Depositary or any nominee to a successor Depositary or any nominee of
the 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
29
<PAGE>
Securities of other denominations of a like aggregate Liquidation Amount, at the
corporate trust 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
the Global Trust Preferred Security with or on behalf of the Depositary, the
Depositary for the 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
the Global Trust Preferred Securities to the accounts of Participants. These
accounts will be designated by the dealers, underwriters or agents with respect
to the 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 the
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 certain purchasers of
securities take physical delivery of the securities in definitive form. These
limits and 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 the Global Trust Preferred Security, the
Depositary or the nominee, as the case may be, will be considered the sole owner
or holder of the Trust Preferred Securities represented by the 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 under the Trust Agreement.
Neither the Property Trustee, any Paying Agent (as defined below), the
Securities Registrar (as defined below) for the Trust Preferred Securities nor
we 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 the Trust Preferred Securities or
for maintaining supervising or reviewing any records relating to the beneficial
ownership interests.
We expect 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. We also expect 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." These 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 us 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 the Trust Preferred
Securities, determine not to have any Trust Preferred Securities represented by
one or more Global Trust Preferred Securities and, in that event, will issue
individual
30
<PAGE>
Trust Preferred Securities in exchange for the Global Trust Preferred Security.
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 the Global Trust Preferred Security equal in
Liquidation Amount to the beneficial interest and to have the Trust Preferred
Securities registered in its name. Individual Trust Preferred Securities so
issued will be issued in denominations, unless otherwise specified by us, of $10
and integral multiples thereof.
PAYMENT AND PAYING AGENCY
Payments on the Trust Preferred Securities held in global form will be made
to the Depositary, which will credit the relevant accounts at the Depositary on
the applicable Distribution Dates. Payments on the Trust Preferred Securities
that are not held by the Depositary will be made by check mailed to the address
of the holder entitled thereto as the address which appears on the register. The
paying agent (the "Paying Agent") will initially be the Property Trustee and any
co-paying agent chosen by the Property Trustee and acceptable to the
Administrative Trustees and us. The Paying Agent will be permitted to resign as
Paying Agent upon 30 days' written notice to the Administrative Trustees. In the
event that the Property Trustee will no longer be the Paying Agent, the
Administrative Trustees will appoint a successor (which will be a bank or trust
company acceptable to the Administrative Trustees and us) to act as Paying
Agent.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will initially act as registrar and transfer agent for
the Trust Preferred Securities (the "Securities Registrar"). 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 the 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 or security against the
costs, expenses and liabilities that might be incurred. 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 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 may
take the action as is directed by and, if not so directed, may take 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. The Property Trustee also serves as the property trustee, guarantee
trustee and the indenture trustee with respect to the 9.28% trust preferred
securities issued by Trust I in May 1997 and the related junior subordinated
debentures due May 19, 2027.
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 other than a grantor trust for United
31
<PAGE>
States federal income tax purposes and so that the Junior Subordinated
Debentures will be treated by us as indebtedness for United States federal
income tax purposes. In this connection, we 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 we and the
Administrative Trustees determine in our discretion to be necessary or desirable
for these purposes, as long as the action does not adversely affect the
interests of the holders of the Trust Securities or vary the terms thereof. The
Administrative Trustees also serve as administrative trustees of Trust I.
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.
32
<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 Debenture Trustee and us. The Indenture will be qualified under 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
is qualified in its 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, together with the consideration paid by us for the
Common Securities, in Junior Subordinated Debentures issued by us. The Junior
Subordinated Debentures will be issued as unsecured debt under the Indenture.
We may at any time dissolve the Trust and, after satisfaction of liabilities
to creditors of the Trust, cause the Junior Subordinated Debentures to be
distributed to the holders of the Trust Securities in liquidation of the Trust.
If the Junior Subordinated Debentures are distributed to the holders of the
Trust Preferred Securities, we will use our best efforts to list the Junior
Subordinated Debentures on a national securities exchange or comparable
automated quotation system.
GENERAL
The Junior Subordinated Debentures will bear interest at the annual rate of
% of the principal amount thereof, payable quarterly in arrears on the last
day of March, June, September and December of each year (each, an "Interest
Payment Date"), commencing , 1999, to the person in whose name each
Junior Subordinated Debenture is registered, subject to certain exceptions, on
the fifteenth day of 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, 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. We anticipate that, until the dissolution, 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 quarter, on the basis of the actual number of days elapsed
in the quarter based upon 30-day months. 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 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 the next succeeding Business Day falls in the
next succeeding calendar year, then the payment will be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date. 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 % thereof, compounded quarterly.
The term "interest," as used herein, includes 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 , 2029 (the "Stated
Maturity Date"). On or after , 2004, we will have the right to redeem the
Junior Subordinated Debentures in whole at any time or in part from time to time
at a redemption price equal to 100% of the principal amount thereof plus accrued
and unpaid interest on the Junior Subordinated Debentures so redeemed
33
<PAGE>
to the date fixed for redemption, subject to our having received prior approval
if it is then required under applicable regulatory requirements. In the event
that we elect to redeem the Junior Subordinated Debentures, we will give notice
to the Debenture Trustee, and the Debenture Trustee will give notice of the
redemption to the holders of the Junior Subordinated Debentures no less than
30 days or more than 60 days prior to the effectiveness thereof.
The Junior Subordinated Debentures will rank equal with all Other Debentures
and will be unsecured and will rank subordinate and junior in right of payment
to all Senior and Subordinated Indebtedness (as defined under "Description of
Junior Subordinated Debentures--Subordination") to the extent and in the manner
set forth in the Indenture.
OPTION TO EXTEND INTEREST PAYMENT DATE
So long as no Debenture Event of Default has occurred and is continuing, we
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 calendar quarters, provided that no Deferral Period
may end on a date other than an Interest Payment Date or extend beyond the
Stated Maturity Date. At the end of such Deferral Period, we 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 a Deferral 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 a Deferral Period, we will not undertake any of the actions set forth
below under "--Certain Covenants We Have Made."
Prior to the termination of any such Deferral Period, we may further extend
such Deferral Period, provided that such extension does not cause such Deferral
Period together with all previous and further extensions within the Deferral
Period to exceed 20 consecutive calendar quarters, end on a date other than an
Interest Payment Date or extend beyond the Stated Maturity Date. Upon the
termination of any such Deferral Period and the payment of all amounts then due
on any Interest Payment Date, we may elect to begin a new Deferral Period,
subject to the above requirements. No interest will be due and payable during a
Deferral Period, except at the end of that period. We must give the Property
Trustee, the Administrative Trustees and the Debenture Trustee notice of
election of any Deferral Period (or an extension thereof) at least five Business
Days prior to the earlier of (i) the next succeeding date on which Distributions
on the Trust Preferred Securities are payable or (ii) the date the Trust is
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 five Business Days prior to the record
date. The Debenture Trustee will give notice of our election to begin or extend
a new Deferral Period to the holders of the Trust Preferred Securities.
ADDITIONAL SUMS
If the Trust or the Property Trustee is required to pay any additional
taxes, duties, assessments or other governmental charges, we will pay Additional
Sums as required so that the Distributions payable by the Trust shall not be
reduced as a result of any such additional taxes, duties, assessments or other
governmental charges.
34
<PAGE>
REDEMPTION
Subject to our having received any prior approval required under applicable
regulatory requirements, the Junior Subordinated Debentures are redeemable prior
to maturity at our option on or after , 2004, in whole (at any time) or in
part (from time to time), at a redemption price equal to 100% of the principal
amount plus accrued and unpaid interest on the Junior Subordinated Debentures to
the date of redemption.
The Junior Subordinated Debentures are also redeemable prior to maturity at
any time in whole (but not in part), within 90 days following the occurrence of
a Special Event, in each case at a redemption price equal to 100% of the
principal amount plus accrued and unpaid interest on the Junior Subordinated
Debentures so redeemed to the date fixed for redemption. If a partial redemption
of the Trust Preferred Securities resulting from a partial redemption of the
Junior Subordinated Debentures would result in a delisting of the Trust
Preferred Securities, then we may redeem the Junior Subordinated Debentures in
whole only.
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 the holder's registered address. Unless we default
in payments of the redemption price, on and after the redemption date, interest
ceases to accrue on the Junior Subordinated Debentures or portions called for
redemption.
The Junior Subordinated Debentures will not be subject to any sinking fund.
DISTRIBUTION UPON LIQUIDATION
Under certain circumstances involving the dissolution 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. See "Description of Trust Preferred
Securities--Liquidation Distribution Upon Dissolution." 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. We anticipate that the depositary arrangements for the Junior
Subordinated Debentures 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, we will use our 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. We can give 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 WE HAVE MADE
If at any time (1) there shall have occurred any event of which we have
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 we
shall not have taken reasonable steps to cure, (2) we are in default with
respect to our payment of any obligations under the Guarantee, or (3) we shall
have given notice of our election of a Deferral Period as provided in the
Indenture and shall not have rescinded such notice, and such Deferral Period, or
any extension thereof, shall have commenced and be continuing, then we will not,
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of our capital
stock;
35
<PAGE>
- make any payment of principal, interest or premium, if any, on or repay or
repurchase or redeem any of our debt securities (including Other
Debentures) that rank equal with or junior in right of payment to the
Junior Subordinated Debentures; or
- make any guarantee payments with respect to any guarantee by us of the
debt securities of any of our subsidiaries (including under Other
Guarantees) if such guarantee ranks equal or junior in right of payment to
the Junior Subordinated Debentures.
However, we will not violate the first bullet point above if we
- declare or pay dividends or make distributions in shares of, or options,
warrants or rights to subscribe for or purchase shares of our common
stock;
- declare a dividend in connection with the implementation of a
stockholders' rights plan, or issue stock under any plan in the future, or
redeem or repurchase any rights under such a plan;
- make payments under the Guarantee;
- purchase fractional shares as a result of a reclassification of our
capital stock;
- purchase fractional interests in shares of our capital stock pursuant to
the conversion or exchange provisions of our capital stock or the security
being converted or exchanged; or
- purchase common stock as a result of the issuance of common stock or
rights under any of our benefit plans for directors, officers or employees
or any of our dividend reinvestment plan.
So long as the Trust Securities remain outstanding, we also have agreed
(i) to maintain 100% direct or indirect ownership of the Common Securities;
provided, however, that any permitted successor to us under the Indenture may
succeed to our ownership of such Common Securities, (ii) to not voluntarily
dissolve, wind-up or terminate the Trust, except in connection with the
distribution of the Junior Subordinated Debentures or certain mergers,
consolidations or amalgamations, each as permitted by the Trust Agreement,
(iii) to timely perform our duties as sponsor of the Trust, (iv) to use our
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 (v) to use our 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, we have 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 which we are the subject of, 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. As of
September 30, 1999, we had no Senior and Subordinated Indebtedness outstanding.
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
36
<PAGE>
acceleration) before the holders of Junior Subordinated Debentures will be
entitled to receive or retain any payment in respect of the Junior Subordinated
Debentures.
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 default.
We are a holding company and almost all of our operating assets are owned by
our subsidiaries. We are a legal entity separate and distinct from our
subsidiaries. Holders of Junior Subordinated Debentures should look only to us
for payments on the Junior Subordinated Debentures. The principal sources of our
income are dividends, interest and fees from our subsidiaries. We rely primarily
on dividends from the Bank to meet our obligations for payment of principal and
interest on our corporate expenses. There are regulatory limitations on the
payment of dividends directly or indirectly to us from the Bank. As of
September 30, 1999, under applicable banking statutes, the total capital
available for payment of dividends by the Bank to us was approximately
$27 million. However, bank 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, us and
certain affiliates, and on investments in stock or other securities. These
restrictions prevent us and our affiliates from borrowing from the Bank unless
the loans are secured by various types of collateral. Further, secured loans,
other transactions and investments by the Bank are generally limited in amount
as to us and as to each of our affiliates to 10% of the Bank's capital and
surplus and as to us and all of our other affiliates to an aggregate of 20% of
the Bank's capital and surplus.
Because we are a holding company, our right 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 we may be recognized as a creditor
of that subsidiary. At September 30, 1999, our subsidiaries had total
liabilities (excluding liabilities owed to us) of $1.5 billion. Accordingly, the
Junior Subordinated Debentures will be effectively subordinated to all existing
and future liabilities of our subsidiaries and all liabilities of any of our
future subsidiaries. The Indenture does not limit our or our subsidiaries'
ability to incur or issue other secured or unsecured debt, including Senior and
Subordinated Indebtedness.
DEFINITIONS. For purposes of the foregoing paragraphs, the following
definitions apply:
"Allocable Amounts," when used with respect to any Senior and Subordinated
Indebtedness, means all amounts due or to become due on the Senior and
Subordinated Indebtedness less, if applicable, any amount which would have been
paid to, and retained by, the holders of the Senior and Subordinated
Indebtedness (whether as a result of the receipt of payments by the holders of
such Senior and Subordinated Indebtedness from us or any other obligated party
or from any holders of, or trustee in respect of, other indebtedness that is
subordinate and junior in right of payment to the Senior and Subordinated
Indebtedness) 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" means with respect to any person, whether recourse is to all
or a portion of the assets of such person and whether or not contingent:
(i) every obligation of any person for money
37
<PAGE>
borrowed; (ii) every obligation of the 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 the person with respect to letters of credit,
banker's acceptances or similar facilities issued for the account of the person;
(iv) every obligation of the 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 the person; (vi) all indebtedness of the 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, the 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 us whether or
not the claim for post-petition interest is allowed in such proceeding), on our
Indebtedness 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 the obligations
are not superior in right of payment to the Junior Subordinated Debentures or to
other Indebtedness which is equal with, or subordinated to, the Junior
Subordinated Debentures. However, Senior and Subordinated Indebtedness does not
include (i) any of our Indebtedness which when incurred and without respect to
any election under section 1111(b) of the United States Bankruptcy Reform Act of
1978, as amended, was without recourse to us, (ii) any Indebtedness we have to
any of our subsidiaries, (iii) Indebtedness to any of our employees, and
(iv) any other debt securities issued pursuant to the Indenture.
DENOMINATIONS, REGISTRATION AND TRANSFER
If the Junior Subordinated Debentures are distributed to the holders of the
Trust Preferred Securities, the Junior Subordinated Debentures will be
represented by global certificates registered in the name of the Depositary or
its nominee (the "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."
Unless and until a Global Subordinated Debenture is exchanged in whole or in
part for the individual Junior Subordinated Debentures, it may not be
transferred except as a whole by the Depositary for the Global Subordinated
Debenture to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
nominee to a successor Depositary or any nominee of the successor.
A Global Subordinated Debenture will 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 us that it is unwilling or unable to
continue as a depositary for such Global Subordinated Debenture 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) we in our sole
discretion determine that the Global Subordinated Debenture will be so
exchangeable or (iii) there shall have occurred and be continuing a Debenture
Event of Default with respect to the Global Subordinated Debenture. Any Global
Subordinated Debenture that is exchangeable pursuant to the preceding sentence
will be exchangeable for definitive certificates registered in such names as the
Depositary shall direct. It is expected that the instructions will be based upon
directions received by the Depositary from its Participants with respect
38
<PAGE>
to ownership of beneficial interests in the Global Subordinated Debenture. In
the event that Junior Subordinated Debentures are issued in definitive form, the
Junior Subordinated Debentures will be in denominations of $10 and integral
multiples thereof and may be transferred or exchanged at the offices described
below.
Payments on Junior Subordinated Debentures represented by a Global
Subordinated Debenture will be made to the Depositary, as the depositary for the
Junior Subordinated Debentures. In the event Junior Subordinated Debentures will
be registrable, 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 us, provided that payment of
interest may be made at our option 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."
We 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. We may at any time rescind the designation of any transfer agent or
approve a change in the location through which any transfer agent acts, provided
that we maintain a transfer agent in the place of payment. We may at any time
designate additional transfer agents with respect to the Junior Subordinated
Debentures.
In the event of any redemption, neither we 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 the 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 the
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 the
securities in definitive form. These limits and laws may impair the ability to
transfer beneficial interests in a Global Subordinated Debenture.
39
<PAGE>
So long as the Depositary for a Global Subordinated Debenture, or its
nominee, is the registered owner of the Global Subordinated Debenture, the
Depositary or such nominee, as the case may be, will be considered the sole
owner or holder of the Junior Subordinated Debentures represented by the Global
Subordinated Debenture for all purposes under the Indenture governing the 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 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 the Junior Subordinated Debentures. Neither we nor the Debenture
Trustee, any Paying Agent, or the Securities Registrar for such Junior
Subordinated Debentures 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 Subordinated Debenture representing the Junior
Subordinated Debentures or for maintaining, supervising or reviewing any records
relating to the beneficial ownership interests.
If the Depositary is at any time unwilling, unable or ineligible to continue
as depositary and a successor depositary is not appointed by us within 90 days
after we receive notice or otherwise become aware of the situation, we will
issue individual Junior Subordinated Debentures in exchange for the Global
Subordinated Debenture. In addition, we may at any time and in our sole
discretion, determine not to have the Junior Subordinated Debentures represented
by one or more Global Subordinated Debenture and, in such event, we will issue
individual Junior Subordinated Debentures in exchange for the Global
Subordinated Debenture. Further, if we so specify 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 us, 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 us, of $10 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 we may designate from
time to time, except that at our option, 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 the address
appears in the register for Junior Subordinated Debentures or (ii) by transfer
to an account maintained by the Person as specified in the 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. We may at any time designate
additional Paying Agents or rescind the designation of any Paying Agent; however
we will at all times be required to maintain a Paying Agent in each place of
payment for the Junior Subordinated Debentures.
We expect 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
40
<PAGE>
their respective beneficial interest in the principal amount of the Global
Subordinated Debenture as shown on the records of such Depositary or its
nominee. We also expect that payments by Participants to owners of beneficial
interests in such Global Subordinated Debenture held through the 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." These payments will be the responsibility of such
Participants.
Any moneys deposited with the Debenture Trustee or any Paying Agent, or then
held by us 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 will, at our request, be repaid
to us and the holder of such Junior Subordinated Debenture will thereafter look,
as a general unsecured creditor, only to us for payment thereof.
MODIFICATION OF INDENTURE
From time to time we 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 action does not
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 us 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 except
pursuant to our right under the Indenture to defer the payment of interest 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
modification of the Indenture; provided that so long as any of the Trust
Preferred Securities remain outstanding, no modification may be made that
adversely affects the holders of such Trust Preferred Securities, 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 amount of the Junior Subordinated Debentures and all accrued and
unpaid interest thereon have been paid in full and certain other conditions are
satisfied. If the consent of the Property Trustee, as holder of the Junior
Subordination Debentures, is required under the Indenture with respect to
amendments, waivers or supplements of the Indenture or the Junior Subordinated
Debentures, the Property Trustee shall request the direction of the holders of
the Trust Securities with respect to such amendments, waivers or supplements and
shall vote as directed by a majority in Liquidation Amount of the Trust
Securities voting together as a single class. 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, we 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.
41
<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," regardless of the reason and whether it is
voluntary or involuntary or effected by operation of law or pursuant to any
judgment, decree, order, rule or regulation:
- 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 Deferral Period);
- 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;
- failure to observe or perform certain other covenants contained in the
Indenture for 60 days after written notice to us from the Debenture
Trustee or the holders of at least 25% in aggregate outstanding principal
amount of Junior Subordinated Debentures;
- certain events of our bankruptcy, insolvency or reorganization.
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 or exercising any trust or power conferred on
the Debenture Trustee, with respect to the Junior Subordinated Debentures. 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
amount of, and any interest on, the Junior Subordinated Debentures to be due and
payable immediately upon a Debenture Event of Default; provided that, in the
case of certain events of bankruptcy, insolvency or reorganization, such amounts
shall automatically become due and payable. If the Debenture Trustee or holders
of the Junior Subordinated Debentures fail to make the declaration, the Property
Trustee or the holders of at least 25% in the aggregate Liquidation Amount of
the Trust Preferred Securities will have the right. The holders of a majority in
aggregate outstanding principal amount of the Junior Subordinated Debentures may
annul the 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
the default, the holders of a majority in aggregate Liquidation Amount of the
Trust Preferred Securities shall have the right.
The holders of a majority in aggregate outstanding principal amount of the
Junior Subordinated Debentures 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.
In case a Debenture Event of Default occurs and is 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 due and payable and to enforce
its other rights as a creditor with respect to such Junior Subordinated
Debentures.
42
<PAGE>
The Indenture requires the annual filing by us 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 has occurred and is continuing and is
attributable to our failure 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. We may not amend the Indenture to remove the
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 and the rules and regulations thereunder. Notwithstanding any
payments made to a holder of Trust Preferred Securities by us in connection with
a Direct Action, we will remain obligated to pay the principal of or interest on
the Junior Subordinated Debentures, and we will 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 us to such
holder in any Direct Action.
The holders of the Trust Preferred Securities will not be able to exercise
directly any remedies available to the holders of the Junior Subordinated
Debentures, other than those set forth in the preceding paragraph, 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 we will 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, unless: (i) we are the surviving
Person, or the Person formed by or surviving any consolidation or merger (if
other than us) or to which the 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; (ii) upon any consolidation,
merger, sale, conveyance, transfer or lease, the due and punctual payment of the
principal of and interest on the Junior Subordinated Debentures according to
their tenor and the due and punctual performance and observance of all the
covenants and conditions of the Indenture to be kept or performed by us will 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 Debenture Trustee executed and delivered to the Debenture Trustee by the
Person formed by the consolidation, or into which we will have been merged, or
by the Person which will have acquired our property, as the case may be;
(iii) after giving effect to the consolidation, merger, sale, conveyance,
transfer or lease, no Default or Event of Default, or any event which, after
notice or lapse of time or both, would become a Default or an Event of Default,
will have occurred and be continuing; (iv) the consolidation, merger, sale,
conveyance, transfer or lease does not cause the Junior Subordinated Debentures
to be downgraded by a nationally recognized statistical rating organization; and
(v) certain other conditions as prescribed in the Indenture are met.
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 us 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 we deposit or cause to
be deposited with the Debenture Trustee funds, in trust, for the purpose and in
an amount
43
<PAGE>
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 our obligations
to pay all other sums due pursuant to the Indenture and to provide the officers'
certificates and opinions of counsel described therein), and we will be deemed
to have satisfied and discharged the Indenture. We will only be permitted to
take such action if, among other things, we deliver to the Debenture Trustee an
opinion of counsel (who may be counsel for us) to the effect that the holders of
the Junior Subordinated Debentures will not recognize income, gain or loss for
federal income tax purposes as a result of our actions and will be subject to
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 deposit and defeasance had not
occurred.
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 has and will 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.
44
<PAGE>
DESCRIPTION OF GUARANTEE
The Guarantee will be executed and delivered by The Bank of New York (the
"Guarantee Trustee") and us 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 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 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.
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.
We will irrevocably agree to pay in full on a subordinated basis, 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 accrued 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. Our obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by us to the holders of the
Trust Preferred Securities or by causing the Trust to pay such amounts to such
holders.
We 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
If we do 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. The Guarantee will rank equal to the Junior
Subordinated Debentures, Other Debentures (including the junior subordinated
debentures issued in connection with the issuance of the trust preferred
securities of Trust I in May 1997), the guarantee on the Common Securities, any
other guarantee on future issuances of trust preferred securities and any senior
preferred stock which may be hereafter issued by the Company. Because we are a
holding company,
45
<PAGE>
our right to participate in any distribution of assets of any subsidiary upon
such subsidiary's liquidation or reorganization or otherwise is subject to the
prior claims of creditors of that subsidiary, except to the extent we may be
recognized as a creditor of that subsidiary. Accordingly, our obligations under
the Guarantee effectively will be subordinated to all existing and future
liabilities of our subsidiaries and all liabilities of any of our future
subsidiaries. Claimants should look only to our assets for payments under the
Guarantee. For more information, please refer to "Description of Junior
Subordinated Debentures--General."
The Guarantee will constitute a guarantee of payment and not of collection,
which means the guaranteed party may institute a legal proceeding directly
against us 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 limit our ability to incur or issue other secured or unsecured debt,
including Senior and Subordinated Indebtedness, whether under the Indenture, any
other indenture that we may enter into in the future or otherwise.
EVENTS OF DEFAULT
An event of default under the Guarantee will occur upon our failure to
perform any of our payment or other obligations. The holders of 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. Any holder of the Trust Preferred Securities may institute
a legal proceeding directly against us to enforce the Guarantee Trustee's rights
under the Guarantee without first instituting a legal proceeding against the
Trust, the Guarantee Trustee or any other person or entity. Notwithstanding the
foregoing, if we fail to make a payment under the Guarantee, a holder of Trust
Preferred Securities may directly institute a proceeding against us for
enforcement of the Guarantee for payment to the holder of the Trust Preferred
Securities of the holder's pro rata portion of the principal of or interest on
the Junior Subordinated Debentures on or after the due dates specified in the
Junior Subordinated Debentures.
We, as guarantor, will be required to file annually with the Guarantee
Trustee a certificate as to whether or not we are in compliance with all the
conditions and covenants applicable to us under the Guarantee.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not 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. All guarantees and agreements contained in the
Guarantee Agreement shall bind our successors, assigns, receivers, trustees and
representatives 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
46
<PAGE>
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 us 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.
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 a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. 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 SEC.
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 we expect that
Beneficial Owners will 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
47
<PAGE>
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 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 Property Trustee 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 us, 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 us. In the event that a successor securities depositary is
not obtained, definitive Trust Preferred Securities or Junior Subordinated
Debentures certificates representing such Trust Preferred Securities or Junior
Subordinated Debentures are required to be printed and delivered. We, at our
option, 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
48
<PAGE>
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
we believe to be accurate but neither the Trust nor we assume any responsibility
for the accuracy thereof. Neither the Trust nor we have 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.
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 us as and to
the extent set forth under "Description of Guarantee." Taken together, our
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 we do 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. Our obligations under the Guarantee
will be (i) subordinate and junior in right of payment to all Senior and
Subordinated Indebtedness, except for those liabilities made equal or
subordinate to the Guarantee by their terms, (ii) PARI PASSU to all other
guarantees issued or to be issued by us with respect to other similar trust
preferred securities, including the issuance of $28.75 million of trust
preferred securities of Trust I in May 1997; (iii) senior to our capital stock
and (iv) effectively subordinated to the liabilities and obligations of our
subsidiaries.
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, 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) we shall pay for all and any
costs, expenses and liabilities of the Trust except the Trust's obligations to
holders of Trust Securities under the 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 us 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.
49
<PAGE>
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 payment defaults under, or acceleration of, Senior and
Subordinated 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 preferred 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 other activities
that are necessary 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 us 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 us 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 dissolution, 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--Distribution of Junior Subordinated Debentures." Upon our voluntary
or involuntary liquidation or bankruptcy, the Property Trustee, as holder of the
Junior Subordinated Debentures, would be a subordinated creditor of ours,
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 of our stockholders receive payments or distributions.
Since we 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 our stockholders in the event of our liquidation or
bankruptcy will be substantially the same.
50
<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 Trust and us ("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 Internal Revenue Code of
1986, as amended (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 Internal Revenue Service ("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 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 has rendered 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 our indebtedness. We, 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 our indebtedness for all United States federal income
tax purposes.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Trust Preferred Securities, Tax
Counsel has rendered 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
51
<PAGE>
holder will be required to include in its gross income a pro rata share of any
interest (or original issue discount ("OID") accrued) with respect to its
allocable share of those Junior Subordinated Debentures.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under applicable Treasury regulations (the "Regulations"), if the terms and
conditions of a debt instrument make the likelihood that stated interest will
not be timely paid a "remote" contingency, such contingency will be ignored in
determining whether a debt instrument is issued with OID. We believe that the
likelihood of our exercising our option to defer payments of interest is remote,
because exercising the option would, among other things, prevent us from
declaring dividends on any class of our equity securities. Based on this
conclusion by us, Tax Counsel has rendered its opinion 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 we were to exercise our option to defer payments
of stated interest, the Junior Subordinated Debentures would, at such time, be
treated as redeemed and reissued 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
related thereto 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 we would not make actual cash payments during a Deferral Period.
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. 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 that 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 the holder's method of tax accounting, and actual
distributions of stated interest would not be reported as taxable income.
CHARACTERIZATION OF INCOME
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.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE
TRUST
We 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. The 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
the holder's aggregate tax basis in its Trust Preferred Securities. For United
States federal income tax purposes, 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 the holder.
Under certain circumstances described herein, 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.
52
<PAGE>
SALES OF TRUST PREFERRED SECURITIES
A holder that sells Trust Preferred Securities (including a redemption of
the Trust Preferred Securities by us) 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. The 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.
A holder who disposes of the Trust Preferred Securities between record dates
for payments of distributions thereon will be required to include in income (to
the extent not previously included in income) as ordinary income amounts
attributable to accrued and unpaid interest on the Junior Subordinated
Debentures through the date of disposition and the amount realized on
disposition excludes the portion of the sales price treated as interest. To the
extent the selling price is less than the holder's adjusted tax basis, 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.
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) 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 the 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.
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 persons 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 of our classes of stock entitled
to vote, (b) the beneficial owner of the
53
<PAGE>
Trust Preferred Security is not a controlled foreign corporation that is related
to us through stock ownership, (c) the beneficial owner is not a bank whose
receipt of interest is described in Section 881(c)(3)(A) of the Code, and
(d) 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 U.S. 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. Under Treasury
regulations finalized in 1997, the certification requirement referred to in
clause (i)(d) above may be satisfied with other documentary evidence for
interest paid after December 31, 2000 with respect to offshore accounts or
through certain foreign intermediaries.
POTENTIAL TAX LAW CHANGES
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 our ability 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 Internal Revenue Form 1099, which forms should be mailed to holders
of Trust Preferred Securities by January 31 following each calendar year.
BACKUP WITHHOLDING
Backup withholding of United States federal income tax at a rate of 31% may
apply to payments made in respect of the Trust Preferred Securities to
registered owners who are not "exempt recipients" and who fail to provide
certain identifying information (such as the registered owner's taxpayer
identification number) in the required manner. Generally, individuals are not
exempt recipients, whereas corporations and certain other entities generally are
exempt recipients. Payments made in respect of the Trust Preferred Securities to
a U.S. Holder must be reported to the IRS, unless the U.S. Holder is an exempt
recipient or establishes an exemption. Compliance with the identification
procedures described in the "United States Alien Holders" section would
establish an exemption from backup withholding for those United States Alien
Holders who are not exempt recipients.
In addition, upon the sale of the Trust Preferred Securities to (or through)
a broker, the broker must withhold 31% of the entire purchase price, unless
either (i) the broker determines that the seller is a corporation or other
exempt recipient or (ii) the seller provides, in the required manner, certain
identifying information and, in the case of a United States Alien Holder,
certifies that such seller is a United States Alien Holder (and certain other
conditions are met). Such a sale must also be reported by the broker to the IRS,
unless either (i) the broker determines that the seller is an exempt recipient
or (ii) the seller certifies its United States Alien Holder status (and certain
other conditions are met). Certification of the registered owner's United States
Alien Holder status would be made normally on an Internal Revenue Service
Form W-8 under penalties of perjury, although in certain cases it may be
possible to submit other documentary evidence.
54
<PAGE>
ERISA CONSIDERATIONS
We, as the obligor with respect to the Junior Subordinated Debentures held
by the Trust, and our affiliates and the Property Trustee may be considered a
"party in interest" (within the meaning of the Employment Retirement Income
Security Act of 1974, as amended ("ERISA")) or a "disqualified person" (within
the meaning of Section 4975 of the Code) with respect to many employee benefit
plans that are subject to ERISA and/or certain employee benefit-related
provisions of the Code ("Plans"). 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 we, 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 order to avoid prohibited transactions that may result from the purchase
and/or holding of the Trust Preferred Securities, each purchaser of a Trust
Preferred Security shall be deemed to represent to us and the Property Trustee
that either (a) no part of the funds being used to pay the purchase price of the
Trust Preferred Security constitutes "plan assets," or (b) if the funds being
used to pay the purchase price of the Trust Preferred Security include "plan
assets," that its purchase and holding of the Trust Preferred Security will not
result in a prohibited transaction under Section 406 of ERISA or Section 4975 of
the Code (or, in the case of a governmental plan, any substantially similar
Federal, State or local law) for which an exemption is not available.
The U.S. Department of Labor has promulgated a regulation, 29 C.F.R.
Section 2510.3-101 (the "Plan Asset Regulation"), describing what constitutes
the assets of a Plan with respect to the Plan's investment in an entity for
purposes of certain provisions of ERISA and the Code, including the fiduciary
responsibility provisions of ERISA and the prohibited transaction provisions of
ERISA and Section 4975 of the Code. Under the Plan Asset Regulation, if a Plan
invests in an "equity interest" of an entity that is neither a "publicly offered
security" nor a security issued by an investment company registered under the
Investment Company Act, the Plan's assets include both the equity interest and
an undivided interest in each of the entity's underlying assets, unless it is
established that the entity is an "operating company" or that equity
participation in the entity by "benefit plan investors" is not "significant."
Because the Trust Preferred Securities will represent beneficial interests
in the Trust, the Trust Preferred Securities are likely to be considered equity
interests in the Trust for purposes of the Plan Asset Regulation, with the
result that the assets of the Trust are likely to be treated as "plan assets" of
the investing plans for purposes of ERISA and Section 4975 of the Code, unless
the Trust Preferred Securities qualify as "publicly offered securities."
A publicly-offered security is a security that is (a) freely transferable,
(b) part of a class of securities that is owned, immediately subsequent to the
initial offering, by 100 or more investors who were independent of the issuer
and of one another ("Independent Investors") and (c) either is (i) part of a
class of securities registered under section 12(b) or 12(g) of the Exchange Act,
or (ii) sold to the plan as part of an offering of securities to the public
pursuant to an effective registration statement under the Securities Act and the
class of securities of which such security is a part is registered under
55
<PAGE>
the Exchange Act within 120 days (or such later time as may be allowed by the
Commission) after the end of the fiscal year of the issuer during which the
offering of such securities to the public occurred. For purposes of the 100
Independent Investor criterion, the Trust Preferred Securities should be deemed
to be a "class" of securities that would be tested separately from any other
securities that may be issued by the Trust. It is anticipated that the Trust
Preferred Securities will meet the foregoing criteria for treatment as
"publicly-offered securities." No restrictions will be imposed on the transfer
of the Trust Preferred Securities. It is expected that the Trust Preferred
Securities will be held by at least 100 Independent Investors at the conclusion
of the initial public offering although no assurance can be given, and no
monitoring or other measures will be taken to ensure, that such condition is
met. Also, the Trust Preferred Securities will be sold as part of an offering
pursuant to an effective registration statement under the Act and then will be
timely registered under the Exchange Act. As a result the Trust Preferred
Securities should qualify as publicly-offered securities and therefore will be
eligible for purchase by Plans.
In light of the foregoing, fiduciaries or other persons contemplating
purchasing the Trust Preferred Securities on behalf or with "plan assets" of any
Plan should consult their own counsel regarding whether the Trust assets
represented by the Trust Preferred Securities would be considered "plan assets,"
the consequences that would apply if the Trust's assets were considered "plan
assets," and the possibility of exemptive relief from the prohibited transaction
rules. In addition, based on the reasoning of the United States Supreme Court's
decision in JOHN HANCOCK MUT. LIFE. INS. CO. V. HARRIS TRUST AND SAV. BANK, 510
U.S. 86 (1993), under certain circumstances assets in the general account of an
insurance company may be deemed to be plan assets for certain purposes, and
under such a reasoning a purchase of the Trust Preferred Securities with assets
of an insurance company's general account may subject the insurance company to
the prohibited transaction and other fiduciary responsibility rules of ERISA
with respect to such assets. Insurance company general account investors should
also consider the effect of the enactment of Section 401(c) of ERISA and any
regulations issued under Section 401(c). Finally, Plan fiduciaries and other
Plan investors should consider whether the investment (i) satisfies the
diversification requirement of ERISA or other applicable law, (ii) is in
accordance with the Plan's governing instruments, and (iii) is prudent in light
of the "Risk Factors" and other factors discussed herein.
THE SALE OF TRUST PREFERRED SECURITIES TO PLANS IS IN NO RESPECT A
REPRESENTATION BY THE TRUST, US, THE PROPERTY TRUSTEE, THE UNDERWRITER 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 PURCHASER PROPOSING
TO ACQUIRE TRUST PREFERRED SECURITIES WITH ASSETS OF ANY PLAN SHOULD CONSULT
WITH ITS COUNSEL.
56
<PAGE>
UNDERWRITING
Legg Mason Wood Walker, Incorporated, as underwriter, has agreed, subject to
the terms and conditions of its underwriting agreement with Independent and the
Trust, to purchase from the Trust Trust Preferred Securities at the
initial public offering price less the underwriting discounts and commissions
set forth on the cover page of this prospectus.
The underwriting agreement provides that the obligations of the underwriter
are subject to certain conditions, and that if any of the foregoing Trust
Preferred Securities are purchased by the underwriter pursuant to the
underwriting agreement, all such securities must be so purchased. The
underwriter may reject orders in whole or in part and withdraw, cancel, or
modify the offer without notice. Each of Independent and the Trust has agreed to
indemnify the underwriter and their controlling persons against certain
liabilities, including liabilities under the Securities Act of 1933 or to
contribute to payments the underwriter may be required to made in respect
thereof.
The underwriter may also impose a penalty bid on certain selling group
members. This means that if the underwriter purchases Trust Preferred Securities
in the open market to reduce the underwriter's short position or to stabilize
the price of the Trust Preferred Securities, it may reclaim the amount of the
selling concession from the selling group members who sold those Trust Preferred
Securities as part of the offering.
The underwriter may create a "short position" in the Trust Preferred
Securities in connection with the offering, which means that they may over-allot
or sell more shares than are set forth on the cover page of this prospectus. If
the underwriter creates a short position by such over-allotment, then the
underwriter may reduce that short position by purchasing Trust Preferred
Securities in the open market. The underwriter also may elect to reduce any
short position by exercising all or part of the over-allotment option. In
general, purchases of a security for the purpose of stabilization or to reduce a
short position could cause the price of security to be higher than it might
otherwise be in the absence of such purchases. The imposition of a penalty bid
might also have an effect on the price of a security to the extent that it were
to discourage resales of the security.
The underwriter has advised us and the Trust that it proposes 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 underwriter 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
underwriter.
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
us, the underwriting agreement provides that we will pay as compensation for the
underwriter's arranging the investment therein of such proceeds an amount of $
per Trust Preferred Security.
The Trust has granted to the underwriter an option, exercisable for 30 days
from the date of this prospectus, to purchase up to an additional Trust
Preferred Securities at the public offering price set forth on the cover page
hereof less underwriting discounts. The underwriter 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 underwriter exercises its option to purchase
additional Trust Preferred Securities, the Trust will issue and sell to us
additional Common Securities and the we 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.
57
<PAGE>
Both the Trust and us have agreed in the underwriting agreement that,
subject to certain conditions, prior to days following the date of
issuance of the Trust Preferred Securities, neither of us will, directly or
indirectly, issue, sell, offer or agree to sell, grant any option for the sale
of, or otherwise dispose of, Trust Preferred securities, any securities
convertible into, exchangeable or exercisable for Trust Preferred Securities or
the Junior Subordinated Debentures or any debt securities substantially similar
to the Junior Subordinated Debentures or any equity security substantially
similar to the Trust Preferred Securities, except with the prior written consent
of the underwriter, and except for any disposal of Junior Subordinated
Debentures following a liquidation of the Trust.
Each of the Trust and us has agreed to indemnify the underwriter and their
controlling persons against certain liabilities, including liabilities under the
Securities Act or to contribute to payments the underwriter may be required to
made in respect thereof.
The underwriter has advised the Trust that it does 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.
LEGAL MATTERS
Certain legal matters will be passed upon for us by Elias, Matz, Tiernan &
Herrick L.L.P., Washington, D.C., and for the underwriter by Thacher Proffitt &
Wood. Certain matters of Delaware law relating to the validity of the Trust
Preferred Securities will be passed upon on behalf of the Trust by Richards,
Layton & Finger, P.A., special Delaware counsel to the Trust and us.
EXPERTS
The consolidated financial statements of Independent Bank Corp. and
subsidiary incorporated by reference in our Annual Report on Form 10-K for the
year ended December 31, 1998 and incorporated by reference in this prospectus
have been audited by Arthur Andersen LLP, independent public accountants, as
stated in their report appearing therein.
58
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2,000,000 TRUST PREFERRED
SECURITIES
INDEPENDENT CAPITAL TRUST II
% CUMULATIVE TRUST PREFERRED SECURITIES FULLY AND UNCONDITIONALLY
GUARANTEED, AS DESCRIBED HEREIN, BY
INDEPENDENT BANK CORP.
------------------
PROSPECTUS
------------------------
Legg Mason Wood Walker
Incorporated
, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 6,394
NASD fee.................................................... 3,400
Nasdaq fees................................................. 17,500
Trustees' fees and expenses................................. 6,000
Legal fees and expenses..................................... 110,000*
Accounting fees and expenses................................ 45,000*
Printing expenses........................................... 60,000*
Miscellaneous expenses...................................... 26,706*
--------
Total................................................... $275,000
========
</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, 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
II-1
<PAGE>
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 Twelve 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:
(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-2
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- ------------------------------------------------------------
<C> <S>
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 II
4.4 Amended and Restated Declaration of Trust of Independent
Capital Trust II
4.5 Form of Trust Preferred Security Certificate for Independent
Capital Trust II (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 Richards, Layton & Finger P.A. as to legality of
the Trust Preferred Securities to be issued by Independent
Capital Trust II
8 Opinion of Elias, Matz, Tiernan & Herrick L.L.P. as to
certain federal income tax matters
10 Purchase and Assumption Agreement by and among Independent
Bank Corp., Rockland Trust Company, Fleet Financial Group,
Inc., Fleet National Bank and BankBoston, N.A., dated
September 27, 1999(1)
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 Andersen LLP
23.2 Consent of Elias, Matz, Tiernan & Herrick L.L.P. (included
in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger P.A. (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 II
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>
- ------------------------
(1) Incorporated by reference from the current Report on Form 8-K filed by the
Corporation with the Securities and Exchange Commission on October 1, 1999.
II-3
<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-4
<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, Commonwealth of Massachusetts on the 28th
day of October 1999.
<TABLE>
<S> <C> <C>
INDEPENDENT BANK CORP.
By: /s/ DOUGLAS H. PHILIPSEN
-----------------------------------------
Douglas H. Philipsen
CHAIRMAN OF THE BOARD, CHIEF EXECUTIVE
OFFICER AND PRESIDENT
</TABLE>
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 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.
<TABLE>
<S> <C>
/s/ RICHARD S. ANDERSON Date: October 28, 1999
- --------------------------------------------
Richard S. Anderson
Director
/s/ DONALD K. ATKINS Date: October 28, 1999
- --------------------------------------------
Donald K. Atkins
Director
/s/ W. PAUL CLARK Date: October 28, 1999
- --------------------------------------------
W. Paul Clark
Director
/s/ ROBERT L. CUSHING Date: October 28, 1999
- --------------------------------------------
Robert L. Cushing
Director
</TABLE>
II-5
<PAGE>
<TABLE>
<S> <C>
/s/ BENJAMIN A. GILMORE, II Date: October 28, 1999
- --------------------------------------------
Benjamin A. Gilmore, II
Director
/s/ LAWRENCE M. LEVINSON Date: October 28, 1999
- --------------------------------------------
Lawrence M. Levinson
Director
/s/ DOUGLAS H. PHILIPSEN Date: October 28, 1999
- --------------------------------------------
Douglas H. Philipsen
Chairman, Chief Executive Officer
and President
/s/ RICHARD H. SGARZI Date: October 28, 1999
- --------------------------------------------
Richard H. Sgarzi
Director
/s/ ROBERT J. SPENCE Date: October 28, 1999
- --------------------------------------------
Robert J. Spence
Director
/s/ WILLIAM J. SPENCE Date: October 28, 1999
- --------------------------------------------
William J. Spence
Director
/s/ BRIAN S. TEDESCHI Date: October 28, 1999
- --------------------------------------------
Brian S. Tedeschi
Director
/s/ THOMAS J. TEUTEN Date: October 28, 1999
- --------------------------------------------
Thomas J. Teuten
Director
/s/ RICHARD J. SEAMAN Date: October 28, 1999
- --------------------------------------------
Richard J. Seaman
Chief Financial Officer and Treasurer
(principal financial and accounting officer)
</TABLE>
II-6
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, Independent
Capital Trust II 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, Commonwealth of Massachusetts, on the
28th day of October 1999.
<TABLE>
<S> <C> <C>
INDEPENDENT CAPITAL TRUST II
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
</TABLE>
II-7
<PAGE>
Exhibit 1
-------------------------------------
INDEPENDENT BANK CORP.
(a Massachusetts corporation); and
INDEPENDENT CAPITAL TRUST II
(a Delaware statutory business trust)
2,000,000
____% Cumulative Trust
Preferred Securities
UNDERWRITING AGREEMENT
Dated: __________, 1999
-------------------------------------
<PAGE>
EXHIBIT 1
INDEPENDENT BANK CORP.
(a Massachusetts corporation); and
INDEPENDENT CAPITAL TRUST II
(a Delaware statutory business trust)
2,000,000
____% Cumulative Trust
Preferred Securities
(Liquidation Amount $10 Per Cumulative Preferred Security)
UNDERWRITING AGREEMENT
______, 1999
LEGG MASON WOOD WALKER, INCORPORATED 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 II (the "Trust"), a statutory business trust
organized under the Delaware Business Trust Act, 12 Del. C. ss.ss. 3801 ET SEQ.
(the "Delaware Act"), confirms its agreement with you and Legg Mason Wood
Walker, Incorporated ("Legg Mason") with respect to the issuance and sale by the
Trust, and the purchase by the Underwriter of the respective numbers of _____ %
Cumulative Trust Preferred Securities (liquidation amount $10 per preferred
security) set forth in Schedule A hereto and the grant by the Trust to the
Underwriter, of the option described in Section 2(b) hereof to purchase all or
any part of 300,000 additional Preferred Securities to cover overallotments, if
any. The aforesaid 2,000,000 preferred securities (the "Initial Preferred
Securities") to be purchased by the Underwriter and all or any part of the
300,000 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
<PAGE>
of the holders from time to time of the Preferred Securities. The Company and
the Trust each understand that the Underwriter proposes to make a public
offering of the Preferred Securities as soon as it deems 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 2029 (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 Delaware 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 (Nos.
333-_____and 333-_____-01) 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 deliver of this Agreement,
the Company will either (i) prepare and file a prospectus in accordance with the
provisions of Rule 430A ("Rule 430A") and 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
2
<PAGE>
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 call the "Prospectus." If Rule 434 is relied on, the term
"Prospectus" shall refer to the preliminary prospectus dated __________, 1999
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 the 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 the 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 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
3
<PAGE>
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 the Underwriter
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 Underwriter 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 incorporated by reference in the Prospectus
are independent public accountants within the meaning of the 1933 Act
and the 1933 Act Regulations.
(iii) FINANCIAL STATEMENTS. The consolidated historical
financial statements, together with the related schedules and notes,
incorporated by reference 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 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 incorporated by reference 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 financial condition, 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
4
<PAGE>
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 Commonwealth 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 Commonwealth 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.
(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 or similar rights arising by operation of law, under
the Articles of Organization or bylaws of the Company or under any
agreement to which the Company is a party. 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 September 30, 1999 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
5
<PAGE>
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.
(xii) AUTHORIZATION OF COMMON SECURITIES. The Common
Securities have been duly authorized for issuance by the Trust pursuant
to the Declaration and, when certificates therefor have been issued,
executed and authenticated 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").
6
<PAGE>
(xvi) AUTHORIZATION OF GUARANTEES. The Preferred Securities
Guarantee has been qualified under the 1939 Act and each of the
Guarantees 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 "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,
7
<PAGE>
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, 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 DISPUTES. 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; the
aggregate of all pending legal or governmental proceedings to which the
Trust or the Company or any of its
8
<PAGE>
subsidiaries is a party or of which any of their respective properties
or assets is the subject which are not described in the Prospectus,
including ordinary routine litigation incidental to the business, are
not, in the reasonable judgement of the Company or the Trust, expected
to result in a Material Adverse Effect.
(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 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. Each of the Trust, the Company and
its subsidiaries has 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 Trust, or 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
9
<PAGE>
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
reasonably expected to, cause or result in stabilization or
manipulation of the price of the Preferred Securities.
(xxx) INTELLECTUAL PROPERTY. Each of the Trust, the Company
and the subsidiaries of the Company own or possess, or can acquire on
reasonable terms, adequate patents, licenses, trademarks, service
marks, or trade names (collectively, "Intellectual Property") presently
employed by them in connection with the business now operated by them
or reasonably necessary in order to conduct such business, and neither
the Trust, the Company nor any of the Company's subsidiaries has
received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Trust, the Company or any of its subsidiaries therein,
and which infringement or conflict (if the subject of any unfavorable
decision, ruling or finding) or invalidity or inadequacy, singly or in
the aggregate, in the reasonable judgment of the Company, is likely to
result in a Material Adverse Effect.
(xxxi) YEAR 2000. The computer software operated by the
Company and any subsidiary which is material to the conduct of the
business of the Company and any subsidiary is in compliance in all
material respects with all relevant Federal Financial Institutions
Examination Council guidance and requirements relating to the Year 2000
computer issues.
(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 Underwriter shall be deemed a representation and
warranty by the Trust or the Company, as the case may be, to the Underwriter as
to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITER; 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 the Underwriter, and
the Underwriter agrees to purchase from the Trust, at the purchase price of $10
per Initial Preferred Security, the number of Initial Preferred Securities set
forth in Schedule A opposite the name of the Underwriter, plus any additional
number of Initial Preferred Securities which the Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof, subject,
in each case, to such adjustments to the Underwriter as it in its sole
discretion shall make to eliminate any sales or purchases of fractional
securities. As compensation to the Underwriter for its 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
10
<PAGE>
Delivery to the Underwriter a commission of $____ per Preferred Security
purchased by the Underwriter by wire transfer of immediately available funds.
(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
Underwriter to purchase up to 300,000 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, but only once, solely 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 Underwriter to the Trust
setting forth the number of Optional Preferred Securities as to which the
Underwriter is 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 Underwriter, but
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, the Underwriter
will purchase and the Trust agrees to sell to the Underwriter 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 the Underwriter bears to the total number of Initial Preferred
Securities, subject in each case to such adjustments as the Underwriter in its
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 Elias, Matz, Tiernan & Herrick L.L.P. in Washington, D.C., or at such other
place as shall be agreed upon by the Underwriter and the Offerors, at 9:00 a.m.,
Washington, D.C. time, on ________, 1999 (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 Underwriter 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 Underwriter, 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 Underwriter and the Offerors on the Date of Delivery as specified in
the notice from the Underwriter 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 Underwriter through the facilities of the Depository
Trust Company ("DTC") of certificates for the Preferred Securities to be
purchased by them.
(d) DENOMINATIONS, REGISTRATION. Certificates for the Initial
Preferred Securities and the Optional Preferred Securities, if any, shall be in
definitive form, and in such denominations and registered in such names as the
Underwriter may request in writing at least one business day before the Closing
Time
11
<PAGE>
or the Date of Delivery, as the case may be. All such certificates shall be made
available for examination and packaging by the Underwriter at the office of DTC
or its designated custodian not later than 10:00 a.m. on the last business day
prior to the Closing Time or the Date of Delivery, as the case may be.
SECTION 3. COVENANTS OF THE OFFERORS. The Offerors jointly and
severally covenant with the 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 Underwriter 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 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 Underwriter 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
Underwriter 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 Underwriter or counsel for the Underwriter shall
reasonably object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has
furnished or will deliver to the Underwriter and counsel for the Underwriter,
without charge, two copies of the Registration Statement as originally filed and
of each amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and copies of all consents and certificates of experts, and
will also deliver to the Underwriter, without charge, a conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(without exhibits) for the Underwriter. The copies of the Registration Statement
and each amendment thereto furnished to the Underwriter will be substantively
identical to the electronically transmitted copies thereof filed with the Commis
sion pursuant to EDGAR, except to the extent permitted by Regulation S-T.
12
<PAGE>
(d) DELIVERY OF PROSPECTUSES. The Offerors, as promptly as
possible, will furnish to the Underwriter, 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
Underwriter 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 the 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 the Underwriter may reasonably request. The
Prospectus and any amendments or supplements thereto furnished to the
Underwriter 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.
(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 Underwriter 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 tile 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
Underwriter such number of copies of such amendment or supplement as the
Underwriter may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company and the Trust will
each use its best efforts, in cooperation with the Underwriter, to qualify the
Preferred Securities for offering and sale under the applicable securities laws
of such states and other jurisdictions as the Underwriter 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 later of
the effective date of the Registration Statement and any Rule 462(b)
Registration Statement.
13
<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 Underwriter, 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 Underwriter as evidenced by a notice in writing from
the Underwriter 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 Underwriter or counsel to the Underwriter, 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 Underwriter 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
Underwriter) 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) DTC. The Offerors will cooperate with the Underwriter and
use their best efforts to permit the Preferred Securities to be eligible for
clearance and settlement through the facilities of DTC.
(j) 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
from the sale of the Junior Subordinated Debentures, in the manner specified in
the Prospectus under "Use of Proceeds."
(k) LISTING. The Company will use its best efforts to effect
the listing of the Preferred Securities on the Nasdaq National Market
("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 or such other exchange where the Preferred Securities are listed.
(l) 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 the Underwriter, (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
14
<PAGE>
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), 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.
(m) 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 rules and regulations of the Commission under
the 1934 Act.
(n) FURNISH REPORTS. For and during the period ending three
years after the effective date of the Registration Statement, the Company will
furnish to the Underwriter 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 Underwriter 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 and
the Junior Subordinated Debentures, (iii) the preparation, issuance and delivery
of the certificates for the Preferred Securities to the Underwriter, 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 Underwriter, (iv)
the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) 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, (vi) the printing and
delivery to the Underwriter of copies of each preliminary prospectus, any Term
Sheets and of the Prospectus and any amendments or supplements thereto, if any,
(vii) the fees and expenses of any transfer agent or registrar for the Preferred
Securities, (viii) the filing fees incident to the review by the National
Association of Securities Dealers, Inc. (the "NASD") of the terms of the sale of
the Preferred Securities, (ix) the fees and expenses incurred in
15
<PAGE>
connection with the listing of the Preferred Securities and, if applicable, the
Junior Subordinated Debentures on NASDAQ, and (x) the cost and charges of
qualifying the Preferred Securities with DTC.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated
by the Underwriter in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the Underwriter for all of their
reasonable, actual, accountable out-of-pocket expenses, including the reasonable
fees and disbursements of Thacher Proffitt & Wood, counsel for the Underwriter,
up to the limit specified in Section 4(a)(vi) hereof.
SECTION 5. CONDITIONS OF UNDERWRITER' OBLIGATIONS. The obligations of
the Underwriter 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 Underwriter. 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)).
(b) OPINION OF OUTSIDE COUNSEL FOR OFFERORS. At the Closing
Time, the Underwriter shall have received the favorable opinion, dated as of the
Closing Time, of Elias, Matz, Tiernan & Herrick L.L.P., counsel for the
Offerors, in form and substance reasonably satisfactory to the Underwriter. 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
Underwriter.
(c) OPINION OF SPECIAL DELAWARE COUNSEL FOR OFFERORS. At the
Closing Time, the Underwriter shall have received the favorable opinion, dated
as of the Closing Time, of Richards, Layton & Finger P.A., special Delaware
counsel for the Offerors, in form and substance reasonably satisfactory to the
Underwriter.
(d) OPINION OF COUNSEL FOR THE BANK OF NEW YORK. At the
Closing Time, the Underwriter 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
16
<PAGE>
Trustee under the Preferred Securities Guarantee Agreement and Debenture Trustee
under the Indenture, in form and substance reasonably satisfactory to counsel
for the Underwriter.
(e) OPINION OF SPECIAL TAX COUNSEL FOR THE OFFERORS. At the
Closing Time, the Underwriter 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
States 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.
(f) OPINION OF COUNSEL FOR THE UNDERWRITER. At the Closing
Time, the Underwriter shall have received the favorable opinion, dated as of the
Closing Time, of Thacher Proffitt & Wood, counsel for the Underwriter, with
respect to the Preferred Securities, the Operative Documents, the Prospectus and
other related matters as the Underwriter 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
financial condition 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 Underwriter
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 Underwriter, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to Underwriter with
respect to the financial statements and certain financial information included
or incorporated by reference in the Prospectus.
17
<PAGE>
(i) BRING-DOWN COMFORT LETTER. At the Closing Time, the
Underwriter 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.
(j) APPROVAL OF LISTING. At the Closing Time, the Preferred
Securities shall have been approved for listing on NASDAQ.
(k) CONDITIONS TO PURCHASE OF OPTIONAL PREFERRED SECURITIES.
In the event that the Underwriter exercises its 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 the Date of Delivery and, at the Date
of Delivery, the Underwriter 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
Underwriter, 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 Richards, Layton &
Finger P.A., special Delaware counsel for the Offerors, in form and
substance satisfactory to counsel for the Underwriter, 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 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 Underwriter, 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 Underwriter, 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 UNDERWRITER. The favorable
opinion, dated such Date of Delivery, of Thacher Proffitt & Wood,
counsel for the Underwriter, relating to the Optional
18
<PAGE>
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
Underwriter, substantially in the same form and substance as the letter
furnished to the Underwriter 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.
(l) ADDITIONAL DOCUMENTS. At the Closing Time, counsel for the
Underwriter 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 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 Underwriter and counsel for the Underwriter.
(m) 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 Underwriter 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 UNDERWRITER. The Offerors agree to
jointly and severally indemnify and hold harmless (x) the Underwriter, (y) each
person, if any, who controls the 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 and employees of
the 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
19
<PAGE>
or arising out of any untrue statement of a material fact contained in
any preliminary prospectus or the Prospectus (or any amendment or
supple ment 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 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
Underwriter), 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
the Underwriter expressly for use in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and 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 con trolling 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 Preferred 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 the Underwriter.
(b) INDEMNIFICATION OF OFFERORS, DIRECTORS, OFFICERS AND
EMPLOYEES. The Underwriter 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 the Rule
430A Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or
20
<PAGE>
supplement thereto) in reliance upon and in conformity with written information
furnished to the Offerors by the Underwriter 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 investi gation
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 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.
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 Underwriter 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
21
<PAGE>
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
Underwriter, on the other hand, in connection with 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
Underwriter 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 Underwriter,
bear to the aggregate initial offering price of the Preferred Securities.
The relative fault of the Offerors, on the one hand, and the
Underwriter, 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
of omission or alleged omission to state a material fact relates to information
supplied by the Offerors or by the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Offerors and the Underwriter 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 Underwriter 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 Underwriter 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. For purposes of this
Section 7, each person, if any, who controls the Underwriter within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act and the respective
partners, directors, officers and employees of the Underwriter shall have the
same rights to contribution as the Underwriter, and each officer, director and
employee 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.
22
<PAGE>
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 con
trolling person, or by or on behalf of the Trust or the Company, and shall
survive delivery of the Preferred Securities to the Underwriter.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Underwriter 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 Underwriter, 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 NASD or any other governmental authority, or (iv) if a banking
moratorium has been declared by either federal or Massachusetts authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to
this Section, such termination shall he without liability of any party to any
other party except as provided in Section 4 hereof, and provided further that
Sections 6 and 7 hereof shall survive such termination and remain in full force
and effect.
SECTION 10. 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
Underwriter 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 Thacher Proffitt & Wood, 1700 Pennsylvania
Avenue, NW, Suite 800, Washington, DC 20006, Attention: Richard A. Schaberg,
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.
23
<PAGE>
SECTION 11. PARTIES. This Agreement shall inure to the benefit of and
be binding upon each of the Underwriter 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
Underwriter 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 Underwriter 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
Underwriter 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.
SECTION 12. 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 13. EFFECT OF HEADINGS. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
24
<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 Underwriter 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 II
By:
-----------------------------------
Name: Richard J. Seaman
Title: Administrative Trustee
CONFIRMED AND ACCEPTED,
as of the date first above written:
LEGG MASON WOOD WALKER, INCORPORATED
By: Legg Mason Wood Walker, Incorporated
By:
------------------------------------
Authorized Signatory
25
<PAGE>
SCHEDULE A
Number of Initial
Name of Underwriter Preferred-Securities
- ---------------------------------------------------- --------------------
Legg Mason Wood Walker, Incorporated................
Total...............................................
26
<PAGE>
EXHIBIT 4.1
================================================================================
------------------------------
INDEPENDENT BANK CORP.
------------------------------
INDENTURE
DATED AS OF _______ __, 1999
------------------------------
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
______ __, 1999 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
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....................................... 2
Common Stock...................................................... 3
Company........................................................... 3
Company Request................................................... 3
Compounded Interest............................................... 3
Custodian......................................................... 3
Declaration....................................................... 3
Default........................................................... 3
Defaulted Interest................................................ 3
Deferred Interest................................................. 3
Definitive Securities............................................. 3
Depositary........................................................ 3
Dissolution Event................................................. 3
Event of Default.................................................. 3
Exchange Act...................................................... 3
Extended Interest Payment Period.................................. 4
Global Security................................................... 4
Indebtedness...................................................... 4
Indenture......................................................... 4
Independent Capital Trust II or the Trust......................... 4
Interest Payment Date............................................. 4
Investment Company Event.......................................... 4
- --------
*THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE DEEMED TO
BE A PART OF THE INDENTURE.
i
<PAGE>
PAGE
----
Maturity Date..................................................... 4
Mortgage.......................................................... 5
Non Book-Entry Preferred 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.............................................. 6
Preferred Securities Guarantee.................................... 6
Principal Office of the Trustee................................... 7
Property Trustee.................................................. 7
Redemption Date................................................... 7
Redemption Price.................................................. 7
Regulatory Capital Event.......................................... 7
Responsible Officer............................................... 7
Securities or Security............................................ 7
Securities Act.................................................... 7
Securityholder or holder of Securities............................ 7
Security Register................................................. 7
Senior and Subordinated Indebtedness.............................. 7
Special Event..................................................... 8
Subsidiary........................................................ 8
Tax Event......................................................... 8
Trust Indenture Act of 1939....................................... 8
Trustee........................................................... 9
Trust Securities.................................................. 9
Underwriting Agreement............................................ 9
U.S. Government Obligations....................................... 9
ARTICLE II SECURITIES
SECTION 2.01. Forms Generally................................. 9
SECTION 2.02. Execution and Authentication.................... 9
SECTION 2.03. Form and Payment................................ 10
SECTION 2.04. Global Security................................. 10
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............................ 14
SECTION 2.09. Cancellation.................................... 14
SECTION 2.10. Defaulted Interest.............................. 15
SECTION 2.11. CUSIP Numbers................................... 16
ARTICLE III PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal and Interest............... 16
SECTION 3.02. Offices for Notices and Payments, etc........... 16
SECTION 3.03. Appointments to Fill Vacancies in Trustee's
Office ......................................... 17
SECTION 3.04. Provision as to Paying Agent.................... 17
SECTION 3.05. Certificate to Trustee.......................... 18
SECTION 3.06. Compliance with Consolidation Provisions........ 18
SECTION 3.07. Limitation on Dividends......................... 19
SECTION 3.08. Covenants as to Independent Capital Trust II.... 19
SECTION 3.09. Payment of Expenses............................. 20
SECTION 3.10. Payment Upon Resignation or Removal............. 20
SECTION 3.11. Corporate Existence............................. 21
SECTION 3.12. Notice of Default............................... 21
SECTION 3.13. Listing on an Exchange.......................... 21
ARTICLE IV SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
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
SECTION 5.01. Events of Default............................... 24
SECTION 5.02. Payment of Securities on Default; Suit Therefor. 26
SECTION 5.03. Application of Moneys Collected by Trustee...... 28
SECTION 5.04. Proceedings by Securityholders.................. 28
SECTION 5.05. Proceedings by Trustee.......................... 29
SECTION 5.06. Remedies Cumulative and Continuing.............. 29
SECTION 5.07. Direction of Proceedings and Waiver of Defaults
by Majority of Securityholders.................. 30
SECTION 5.08. Notice of Defaults.............................. 30
SECTION 5.09. Undertaking to Pay Costs........................ 31
iii
<PAGE>
PAGE
----
SECTION 5.10. Waiver of Stay, Extension or Usury Laws......... 31
ARTICLE VI CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee.......... 32
SECTION 6.02. Reliance on Documents, Opinions, etc............ 33
SECTION 6.03. No Responsibility for Recitals, etc............. 35
SECTION 6.04. Trustee, Authenticating Agent, Paying Agents,
Transfer Agents or Registrar May Own Securities. 35
SECTION 6.05. Moneys to be Held in Trust...................... 35
SECTION 6.06. Compensation and Expenses of Trustee............ 35
SECTION 6.07. Officers' Certificate as Evidence............... 36
SECTION 6.08. Conflicting Interest of Trustee................. 36
SECTION 6.09. Eligibility of Trustee.......................... 36
SECTION 6.10. Resignation or Removal of Trustee............... 37
SECTION 6.11. Acceptance by Successor Trustee................. 39
SECTION 6.12. Succession by Merger, etc....................... 39
SECTION 6.13. Limitation on Rights of Trustee as a Creditor... 40
SECTION 6.14. Authenticating Agents........................... 40
ARTICLE VII CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders....................... 41
SECTION 7.02. Proof of Execution by Securityholders........... 42
SECTION 7.03. Who Are Deemed Absolute Owners.................. 42
SECTION 7.04. Securities Owned by Company Deemed Not
Outstanding .................................... 42
SECTION 7.05. Revocation of Consents; Future Holders Bound.... 43
ARTICLE VIII SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings............................ 43
SECTION 8.02. Call of Meetings by Trustee..................... 44
SECTION 8.03. Call of Meetings by Company or Securityholders.. 44
SECTION 8.04. Qualifications for Voting....................... 44
SECTION 8.05. Regulations..................................... 44
SECTION 8.06. Voting.......................................... 45
ARTICLE IX AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.............. 46
SECTION 9.02. With Consent of Securityholders................. 47
SECTION 9.03. Compliance with Trust Indenture Act; Effect of
iv
<PAGE>
PAGE
----
Supplemental Indentures......................... 48
SECTION 9.04. Notation on Securities.......................... 48
SECTION 9.05. Evidence of Compliance of Supplemental Indenture
to be Furnished Trustee......................... 49
ARTICLE X CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on Certain Terms. 49
SECTION 10.02. Successor Corporation to be Substituted for
Company ........................................ 49
SECTION 10.03. Opinion of Counsel to be Given Trustee.......... 50
ARTICLE XI SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.......................... 50
SECTION 11.02. Deposited Moneys and U.S. Government Obligations
to be Held in Trust by Trustee.................. 51
SECTION 11.03. Paying Agent to Repay Moneys Held............... 51
SECTION 11.04. Return of Unclaimed Moneys...................... 51
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S.
Government Obligations.......................... 52
ARTICLE XII IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely Corporate
Obligation...................................... 54
ARTICLE XIII MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors...................................... 54
SECTION 13.02. Official Acts by Successor Corporation.......... 54
SECTION 13.03. Surrender of Company Powers..................... 54
SECTION 13.04. Addresses for Notices, etc...................... 55
SECTION 13.05. Governing Law................................... 55
SECTION 13.06. Evidence of Compliance with Conditions Precedent 55
SECTION 13.07. Business Days .................................. 56
SECTION 13.08. Trust Indenture Act to Control.................. 56
SECTION 13.09. Table of Contents, Headings, etc................ 56
SECTION 13.10. Execution in Counterparts....................... 56
SECTION 13.11. Separability.................................... 56
SECTION 13.12. Assignment...................................... 56
SECTION 13.13. Acknowledgement of Rights....................... 57
v
<PAGE>
PAGE
----
ARTICLE XIV REDEMPTION OF SECURITIES
SECTION 14.01. Special Event Redemption........................ 57
SECTION 14.02. Optional Redemption by Company.................. 57
SECTION 14.03. No Sinking Fund................................. 58
SECTION 14.04. Notice of Redemption; Selection of Securities... 58
SECTION 14.05. Payment of Securities Called for Redemption..... 59
ARTICLE XV SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate........................ 60
SECTION 15.02. Default on Senior and Subordinated Indebtedness. 60
SECTION 15.03. Liquidation; Dissolution; Bankruptcy............ 61
SECTION 15.04. Subrogation..................................... 62
SECTION 15.05. Trustee to Effectuate Subordination............. 63
SECTION 15.06. Notice by the Company........................... 63
SECTION 15.07. Rights of the Trustee; Holders of Senior
and Subordinated Indebtedness................... 64
SECTION 15.08. Subordination May Not Be Impaired............... 65
ARTICLE XVI EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period............ 65
SECTION 16.02. Notice of Extension............................. 66
EXHIBIT A....................................................................A-1
Testimonium
Signatures
Acknowledgements
vi
<PAGE>
THIS INDENTURE, dated as of _________ __, 1999, 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 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
<PAGE>
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
Secretary or an Assistant Secretary 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 cities of New York, 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 or 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 II which rank PARI PASSU with Preferred
Securities issued by Independent Capital Trust II; 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.
"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 II.
2
<PAGE>
"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 an Officer 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 II, dated as of _________ __, 1999, 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).
"Dissolution Event" means the liquidation of Independent Capital Trust
II 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 II 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.
3
<PAGE>
"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.
"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 II" or the "Trust" shall mean Independent
Capital Trust II, a Delaware business trust created for the purpose of issuing
its undivided beneficial interests in connection with the issuance of Securities
under this Indenture.
"Interest Payment Date" shall have the meaning set forth in Section
2.05(a).
"Investment Company Event" means the receipt by Independent Capital
Trust II 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 II is or will be considered an "investment company"
that is required to be registered under the Investment Company Act of 1940, as
amended, which change becomes effective on or after the date of original
issuance of the Preferred Securities of Independent Capital Trust II.
4
<PAGE>
"Maturity Date" shall mean __________ __, 2029, or such shorter period
if the Company receives prior regulatory approval if then required under
applicable capital guidelines or regulatory policies.
"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).
"Officer" shall mean any of the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, the Chief Financial Officer, a Vice President,
the Comptroller, the Secretary or an Assistant Secretary 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 unless otherwise provided herein, 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 established or to be
established by the Company, in each case similar to the Trust, including but not
limited to Independent Capital Trust I.
"Other Guarantees" means all guarantees issued or to be issued by the
Company with respect to preferred securities and issued to other trusts to be
established by the Company, in each case similar to the Trust, including but not
limited to Independent Capital Trust I.
"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
(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
5
<PAGE>
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 actually knows to be so
owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor. Upon the
written request of the Trustee, the Company shall furnish to the Trustee
promptly an Officers' Certificate listing and identifying all Securities, if
any, known by the Company to be owned or held by or for the account of the
Company, or any other obligor on the Securities or any Affiliate of the Company
or such obligor, and, subject to the provisions of Section 6.01, 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 as that evidenced by such
particular 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 II which rank PARI PASSU with the Common
Securities issued by Independent Capital Trust II; 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.
6
<PAGE>
"Preferred Securities Guarantee" shall mean any guarantee that the
Company may enter into with The Bank of New York as trustee 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 principally 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.
"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 applicable regulatory
agencies or (b) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronounce ment or decision is announced on or after the date
of this Indenture, the Preferred Securities do not constitute, or within 90 days
of the date thereof, will not constitute, Tier I Capital (or its then
equivalent) for purposes of the capital adequacy guidelines of the Board of
Governors of the Federal Reserve (or any successor regulatory authority with
jurisdiction over bank holding companies), or any capital adequacy guidelines as
then in effect and applicable to the Company; 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 in the corporate trust
department of the Trustee with direct responsibility for the administration of
the Indenture and also means, with respect to a 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.
7
<PAGE>
"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, participation 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, participation or other equivalents having such
power only by reason of the occurrence of a contingency.
"Tax Event" shall mean the receipt by Independent Capital Trust II 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 the date
of this Indenture, there is more than an insubstantial risk that (i) Independent
Capital Trust II 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 II is, or will be within 90 days
of the date of
8
<PAGE>
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
________ __, 1999 among the Company, Independent Capital Trust II 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) 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,
9
<PAGE>
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 $10 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 Secretary or an Assistant Secretary. 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 $__________ aggregate principal amount of the Securities (or
up to $_______ aggregate principal amount of Securities in the event that the
underwriters exercise their over-allotment option granted pursuant to the
Underwriting Agreement), 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 provisions 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
10
<PAGE>
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 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
11
<PAGE>
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
_____ __, 1999, until the principal thereof becomes due and payable on the next
succeeding Interest Payment Date (as defined below), 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 last day of March, June, September and December of
each year (each, an "Interest Payment Date") commencing on _____ _____, 1999, to
the 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 fifteenth day of 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 II on the outstanding
12
<PAGE>
Trust Securities shall not be reduced as a result of any additional taxes,
duties, assessments and other governmental charges to which Independent Capital
Trust II or the Property Trustee 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 Principal 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 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.
13
<PAGE>
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 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
14
<PAGE>
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.
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
15
<PAGE>
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.
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.
By 10:00 a.m. New York time on the date specified herein for the
payment of principal and interest, the Company will deposit with the Trustee or
with one or more paying agents an amount of money sufficient to cover the
required payment with respect to the Securities.
16
<PAGE>
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.
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 (including
Additional Sums and Com pounded Interest, if any) 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
17
<PAGE>
(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
(including Additional Sums and Compounded Interest, if any) 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 (including Additional Sums and
Compounded Interest, if any) 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 (including Additional Sums and Compounded Interest,
if any) on the Securities when the same shall become due and
payable. Whenever the Company shall have one or more paying
agents for the Securities, it will, on or prior to each due
date of the principal of or interest (including Additional
Sums and Compounded Interest, if any) on the Securities,
deposit with the paying agent a sum sufficient to pay the
principal or interest (including Additional Sums and
Compounded Interest, if any) so becoming due, such sum to be
held in trust for the benefit of the Persons entitled to such
principal or interest (including Additional Sums and
Compounded Interest, if any) and (unless such paying agent is
the Trustee) the Company will promptly notify the Trustee of
this action or failure so to act.
(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
18
<PAGE>
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 and conditions 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.
For purposes of this section such default shall be determined without regard to
any period of grace or requirement of notice.
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 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 that would constitute an Event of
Default, (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 II
In the event Securities are issued to Independent Capital Trust II or a
trustee of such trust in connection with the issuance of Trust Securities by
Independent Capital Trust II, for so long as such Trust Securities remain
outstanding, the Company (i) will maintain 100% direct or indirect
19
<PAGE>
ownership of the Common Securities of Independent Capital Trust II; 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 not
voluntarily dissolve, wind-up or terminate the Trust, except in connection with
the distribution of the Junior Subordinated Debentures or certain mergers,
consolidations or amalgamation, each as permitted by the Declaration, (iii) will
timely perform its duties as sponsor of the Trust, (iv) will use its reasonable
efforts to cause Independent Capital Trust II (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 II or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of Independent Capital Trust
II, 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 (v) will 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 II and in connection with the sale of the Trust
Securities by Independent Capital Trust II, 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 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
II, 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 II, 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 II;
(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 II or its assets) and all liabilities,
costs and expenses with respect to such taxes of the Trust; and
20
<PAGE>
(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 II.
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.
SECTION 3.11 Corporate Existence.
The Company will, subject to the provisions of Article X, at all times
maintain its corporate existence and right to carry on business and will duly
procure all renewals and extensions thereof, and , to the extent necessary or
desirable in the operation of its business, will use its best efforts to
maintain, preserve and renew all of its rights, powers, privileges and
franchises.
SECTION 3.12 Notice of Default.
The Company shall file with the Trustee written notice of any Event of
Default within 30 days of its becoming aware of such Event of Default or an
event which, with notice or the lapse of time or both, would constitute an Event
of Default.
SECTION 3.13 Listing on an Exchange.
If the Securities are to be distributed to the holders of the Preferred
Securities in connection with a Dissolution Event, the Company will, if the
Securities are not already so listed, use its best efforts to list such
Securities on the NASDAQ National Market or on such other exchange or other
organizations as the Preferred Securities are then listed.
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 quarterly 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 informa
tion 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 prompt ness 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 source from which such
information was
23
<PAGE>
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 information, 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 which
the Trustee is entitled to rely exclusively on Officers'
Certificates).
24
<PAGE>
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, 2000, deliver to
Securityholders a brief report, dated as of such May 15, which
complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to 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 or any delisting thereof.
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
(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 60
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%
25
<PAGE>
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 60 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 (other than an Event of Default specified
in Section 5.01(d) or 5.01(e)), 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. If the
Trustee or Securityholders fail to declare the principal of all of the
Securities due and payable upon such an Event of Default, so long as the
Property Trustee is holding the Debentures on behalf of Independent Capital
Trust II, the holders of at least 25% in liquidation amount of the Preferred
Securities then outstanding will have the right to declare the Securities
immediately due and payable. If an Event of Default specified in Section 5.01(d)
or 5.01(e) occurs and is continuing, the principal amount of all Securities
shall become immediately due and payable without any declaration or other act on
the part of the Trustee or the holders of Securities.
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
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
26
<PAGE>
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 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 II or a trustee of such trust,
without duplication of any other amounts paid by Independent Capital Trust II 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.
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 decreee, and may
27
<PAGE>
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.
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.
28
<PAGE>
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: 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 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,
29
<PAGE>
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. 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.
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.
30
<PAGE>
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 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; 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
31
<PAGE>
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.
SECTION 5.10 Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law or any usury or
other law wherever enacted, now or at any time hereafter in force, which would
prohibit or forgive the Company from paying all or any portion of the principal
or any interest on (including Additional Sums and Compounded Interest, if any)
any such amounts, as contemplated herein, or which may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
laws and covenants that will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VI
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
32
<PAGE>
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 (but need not confirm or
investigate the accuracy of mathematical calculations or other
facts stated therein);
(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
(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
33
<PAGE>
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 conclusively 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 Secretary or an
Assistant Secretary 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,
suffered or 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; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default with respect to the Securities
(that has not been cured or waived) to exercise with respect to
the Securities 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.
(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
34
<PAGE>
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 and the Trustee is the paying
agent hereunder, (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 at the Principal Office of the Trustee by the
Company or any other obligor on the Securities or by any holder of
the Securities and such notice references the Securities and this
Indenture;
(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; and
(j) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and to each agent,
custodian and other Person employed to act hereunder.
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 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
36
<PAGE>
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 the trust or trusts hereunder, 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 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.
37
<PAGE>
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, at the expense of the Company, 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
(2) the Trustee shall cease to be eligible in accordance with the
provi sions of Section 6.09 and shall fail to resign after
written request therefor by the Company or by any such
Securityholder, or
38
<PAGE>
(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 rehabili tation, conservation or
liquidation, or
(4) the Trustee shall commence a voluntary case under the Federal
bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or state bankruptcy, insolvency or similar
law or shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee,
trustee, sequestrator (or similar official) of the Trustee or
its property or affairs, or shall make an assignment for the
benefit of creditors, or shall admit in writing its inability
to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action.
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 Securityholder, 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. If a successor trustee shall not have
accepted appointment within 30 days after the removal of the
Trustee, the Trustee, at the expense of the Company, may petition
any court of competent jurisdiction for the 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
39
<PAGE>
effective upon acceptance of appointment by the successor trustee
as provided in Section 6.11.
(e) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities and each appointment
of a successor Trustee with respect to the Securities to all
holders of Securities. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
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
40
<PAGE>
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 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
41
<PAGE>
the corporate trust business of any Authenticating Agent, shall be the successor
of such Authenticat ing 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.
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 Authenticat ing 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
42
<PAGE>
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 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.
43
<PAGE>
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 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 corporate trust
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:
44
<PAGE>
(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;
(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
46
<PAGE>
and any representatives of the Trustee and its counsel and any representatives
of the Company and its counsel.
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 $10
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
46
<PAGE>
to the Company and the other to the Trustee 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 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 cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be
defective or inconsis tent 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 adversely
affect the interests of the holders of the Securities;
(d) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities;
47
<PAGE>
(e) 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 II following a Dissolution Event;
(f) to qualify or maintain qualification of this Indenture under the
Trust Indenture Act; and
(g) to make any change that does not adversely affect the rights of
any Securityholder.
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 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 II, 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.
48
<PAGE>
Upon the request of the Company accompanied by a copy of a resolution
of the Board of Directors certified by its Secretary or Assistant Secretary
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 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.
49
<PAGE>
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 and rely upon, 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 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, or any event which, after notice or lapse
of time or both, would become a Default or an 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
50
<PAGE>
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 Capital Trust II, 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.
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,
51
<PAGE>
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 (including
Additional Sums and Compounded Interest, if any).
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
52
<PAGE>
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 combina tion 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
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;
(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
53
<PAGE>
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;
(5) the Trustee will not have a conflicting interest within the
meaning of the Trust Indenture Act;
(6) a breach or violation of, or default under, any other agreement or
intrument to which the Company is a party or by which it is bound
will not result;
(7) a trust arising from such deposit will not result which
constitutes an investment company within the meaning of the
Investment Company Act of 1940, as amended, unless such trust
shall be qualified or exempt from regulation thereunder; and
(8) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent with respect to such Discharge have been
complied with.
"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;
(2) The Defeasance Agent shall provide verification to the Trustee
acknowledg ing receipt of sufficient money and/or U. S. Government
Obligations to meet the applicable conditions set forth in this
Section 11.05.
54
<PAGE>
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.
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.
55
<PAGE>
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: Richard J. Seaman, Chief Financial
Officer. 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 (which may be by facsimile) at the
office of the Trustee, 101 Barclay Street, 21st Floor West, New York, New York
10286, Attention: Corporate Trust Trustee Administration, facsimile: (212)
815-5915 (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 statement 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.
56
<PAGE>
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.
This Indenture is subject to and shall be governed by the provisions of
the Trust Indenture Act that are required to be a part of this Indenture. If any
provision hereof limits, qualifies or conflicts with a provision of the Trust
Indenture Act that is required under such act to be a part of and govern this
Indenture, the Trust Indenture Act provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
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 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,
57
<PAGE>
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. Acknowledgment of Rights.
The Company acknowledges that, with respect to any Securities held by
Independent Capital Trust II 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 II, 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
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 _______ __, 2004, at the Redemption Price.
58
<PAGE>
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 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 $10 or integral multiples thereof shall be
redeemed. The Redemption Price shall be paid prior to 12:00 noon, New York time,
on the date of such redemption or at such earlier time as the Company
determines, PROVIDED that the Company shall deposit with the Trustee an amount
sufficient to pay the Redemption Price by 10:00 a.m., New York time, on the date
such Redemption Price is to be paid.
(b) Notwithstanding the first sentence of Section 14.02, upon the entry
of an order for dissolution of the Independent Capital Trust II 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 _________ __, 2004, 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.
(d) The Company shall not effect a partial redemption of the Securities
if such partial redemption would result in a delisting of the Preferred
Securities from the NASDAQ National Market or such other exchange or
organization as the Preferred Securities are then listed.
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 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
59
<PAGE>
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 $10, 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 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.
60
<PAGE>
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 in full of principal of all
Allocable Amounts on such 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 (after any grace period with respect to such default
has expired and such default has not been cured or waived or ceased to exist),
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 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)
61
<PAGE>
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, 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.
62
<PAGE>
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 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 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
63
<PAGE>
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.
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
64
<PAGE>
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, 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
65
<PAGE>
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 responsibil ity to the Securityholders
and without impairing or releasing the 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
66
<PAGE>
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 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.
67
<PAGE>
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 EX CHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUM STANCES 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.
UNLESS THIS DEBENTURE IS PRESENTED BY AN AUTHORIZED REPRESEN TATIVE OF THE
DEPOSITORY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY PREFERRED SECURITY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF THE CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS
AN INTEREST HEREIN.]
Principal Amount: $__________
No. 1 CUSIP No. ___________
Independent Capital Trust II
____% JUNIOR SUBORDINATED DEFERRABLE INTEREST
DEBENTURE DUE ________ __, 2029
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 The Bank of New
York, as Property Trustee for Independent Capital Trust II or registered
assigns, the principal sum of $__________, on ______ __, 2029 (the "Maturity
Date"); provided that the Company may redeem this Security on a date not earlier
than _________ __, 2004, and to pay interest on the outstanding principal amount
hereof from ________ __, 1999, 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 last day of March, June, September and December of each year,
commencing ______ ____, 1999, at the rate of ____% per annum until the principal
hereof shall have become due and payable, and on any
A-1
<PAGE>
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
quarter, the number of days elapsed in such quarter based upon 30-day months. 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 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 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 fifteenth day of 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
A-2
<PAGE>
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.
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: _________ __, 1999
INDEPENDENT BANK CORP.
By:
--------------------------
Name: Richard J. Seaman
Title:Chief Financial Officer
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____________________ Dated: _________ __, 1999
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 ________
__, 1999 (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 applicable regulatory agencies, if it is then required under
applicable regulatory requirements, the Company shall have the right to redeem
this Security, in whole or in part, at any time on or after _________ __, 2004
at the Redemption Price; PROVIDED, HOWEVER, that the Company shall not effect a
partial redemption of this Security if such partial redemption would result in a
delisting of the Preferred Securities from the NASDAQ National Market or such
other exchange or organization as the Preferred Securities are then listed.
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 such other method that the 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 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 $10 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
A-4
<PAGE>
become, due and payable, in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of 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 would constitute an Event of Default, (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 II 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.
The Securities are issuable only in registered form without coupons
in denominations of $10.00 and any integral multiple thereof. As provided in the
Indenture and subject to the transfer
A-6
<PAGE>
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.
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-7
<PAGE>
Exhibit 4.3
CERTIFICATE OF TRUST
OF
INDEPENDENT CAPITAL TRUST II
This Certificate of Trust is being executed as of October 22, 1999 for the
purposes of organizing a business trust pursuant to the Delaware Business Trust
Act, 12 DEL. C. ss.ss. 3801 ET seq. (the "Act").
The undersigned hereby certifies as follows:
1. NAME. The name of the business trust is "Independent Capital Trust II"
(the "Trust").
2. DELAWARE TRUSTEE. The name and business address of the Delaware 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.
IN WITNESS WHEREOF, the undersigned being all of the trustees of the Trust
as of the date of the filing of this Certificate of Trust, have duly executed
this Certificate of Trust in accordance with Section 3811(a) of the Act 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
Title: Authorized Signatory
ADMINISTRATIVE TRUSTEE
/s/Douglas H. Philipsen
-----------------------------
Name: Douglas H. Philipsen
ADMINISTRATIVE TRUSTEE
/s/Richard J. Seaman
-----------------------------
Name: Richard J. Seaman
ADMINISTRATIVE TRUSTEE
/s/Russell N. Viau
-----------------------------
Name: Russell N. Viau
<PAGE>
EXHIBIT 4.4
---------------------------------------------------
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
INDEPENDENT CAPITAL TRUST II
DATED AS OF _________ __, 1999
---------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions............................................... 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.......................... 8
SECTION 2.2 Lists of Holders of Securities............................ 8
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 ......... 9
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................................................... 12
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 .............................................. 19
SECTION 3.10 Certain Rights of Property Trustee........................ 21
SECTION 3.11 Delaware Trustee.......................................... 23
SECTION 3.12 Execution of Documents.................................... 23
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities ... 24
SECTION 3.14 Duration of Trust......................................... 24
SECTION 3.15 Mergers................................................... 24
SECTION 3.16 Property Trustee May File Proofs of Claims................ 26
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities................... 27
SECTION 4.2 Responsibilities of the Sponsor........................... 27
SECTION 4.3 Right to Proceed.......................................... 27
i
<PAGE>
Page
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.......................................... 30
SECTION 5.7 Appointment, Removal and Resignation of Trustees ......... 30
SECTION 5.8 Vacancies among Trustees.................................. 32
SECTION 5.9 Effect of Vacancies....................................... 32
SECTION 5.10 Meetings.................................................. 33
SECTION 5.11 Delegation of Power....................................... 33
SECTION 5.12 Merger, Conversion, Consolidation or Succession
to Business ........................................... 33
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions............................................. 34
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities................... 34
SECTION 7.2 Execution and Authentication.............................. 35
SECTION 7.3 Form and Dating........................................... 35
SECTION 7.4 Registrar and Paying Agent................................ 37
SECTION 7.5 Paying Agent to Hold Money in Trust....................... 37
SECTION 7.6 Replacement Securities.................................... 37
SECTION 7.7 Outstanding Preferred Securities.......................... 38
SECTION 7.8 Preferred Securities in Treasury.......................... 38
SECTION 7.9 Definitive Securities..................................... 38
SECTION 7.10 Cancellation.............................................. 39
ii
<PAGE>
PAGE
SECTION 7.11 CUSIP Numbers............................................. 39
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Dissolution and Termination of Trust...................... 40
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.................................... 40
SECTION 9.2 Transfer Procedures and Restrictions...................... 42
SECTION 9.3 Deemed Security Holders................................... 44
SECTION 9.4 Book Entry Interests...................................... 44
SECTION 9.5 Notices to Clearing Agency................................ 45
SECTION 9.6 Appointment of Successor Clearing Agency.................. 45
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability................................................. 46
SECTION 10.2 Exculpation............................................... 46
SECTION 10.3 Fiduciary Duty............................................ 47
SECTION 10.4 Indemnification........................................... 47
SECTION 10.5 Outside Businesses........................................ 50
SECTION 10.6 Compensation; Fees........................................ 51
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year............................................... 51
SECTION 11.2 Certain Accounting Matters................................ 51
SECTION 11.3 Banking................................................... 52
SECTION 11.4 Withholding............................................... 52
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments................................................ 52
SECTION 12.2 Meetings of the Holders; Action by Written Consent ....... 54
iii
<PAGE>
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property Trustee ....... 56
SECTION 13.2 Representations and Warranties of Delaware Trustee ....... 56
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices................................................... 57
SECTION 14.2 Governing Law............................................. 59
SECTION 14.3 Intention of the Parties.................................. 59
SECTION 14.4 Headings.................................................. 59
SECTION 14.5 Successors and Assigns.................................... 59
SECTION 14.6 Partial Enforceability.................................... 59
SECTION 14.7 Counterparts.............................................. 59
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
iv
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act
of 1939, as amended Section of Declaration
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
---------------
* 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 II
_________ __, 1999
AMENDED AND RESTATED DECLARATION OF TRUST, including Annex I
and all exhibits attached hereto (this "Declaration"), dated and effective as of
_________ __, 1999, 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 assets of 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 II (the "Trust"),
a trust formed under the Business Trust Act (as defined herein) pursuant to a
Declaration of Trust dated as of ________ __, 1999 (the "Original Declaration"),
and a Certificate of Trust filed with the Secretary of State of the State of
Delaware on ________ __, 1999 (the "Certificate of Trust"), 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 that are necessary 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 in its entirety 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 (as defined herein), 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.
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;
1
<PAGE>
(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.
"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, 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, ss.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.
2
<PAGE>
"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 Date" under the Underwriting
Agreement, including pursuant to the exercise of any over-allotment option
granted to the underwriter thereunder.
"CODE" means the Internal Revenue Code of 1986, as amended from
time to time, or any successor legislation. A reference to a specific section of
the Code refers not only to such specific section but also to any corresponding
provision of any federal tax statute enacted after the date of this Declaration,
as such specific section or corresponding provision is in effect on the date of
application of the provisions of this Declaration containing such reference.
"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 _________ __, 1999 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.
"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 _________ __, 2029 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.
3
<PAGE>
"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: (i) an Event
of Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Debentures; (ii) a 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; (iii) a default by the Trust in the payment of the
redemption price of any Trust Security when it becomes due and payable; (iv) a
default in the performance, or breach, in any material respect, of any covenant
or warranty of the Trustees in this Declaration (other than a default or breach
in the performance of a covenant or warranty which is addressed in the second or
third clause above), and continuation of the default or breach, for a period of
60 days after there has been given, by registered or certified mail, to the
defaulting Trustee or Trustees by the holders of at least 25% in aggregate
liquidation amount of the outstanding Trust Preferred Securities, a written
notice specifying the default or breach and requiring it to be remedied and
stating that the notice is a "Notice of Default" under this Declaration; or (v)
the occurrence of certain events of bankruptcy or insolvency with respect to the
Property Trustee and the failure by the Sponsor to appoint a successor Property
Trustee within 60 days of the event.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"FIDUCIARY INDEMNIFIED PERSON" has the meaning set forth in Section
10.4(b).
"FISCAL YEAR" has the meaning set forth in Section 11.1.
"GLOBAL PREFERRED SECURITY" has the meaning set forth in Section
7.3(a).
4
<PAGE>
"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;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
liquidation amount of Preferred Securities have voted on any matter provided for
in this Declaration, then for the purpose of such determination only (and not
for any other purpose hereunder), if the Preferred Securities remain in the form
of one or more Global Certificates, the term "Holders" shall mean the holder of
the Global Certificate acting at the direction of the Preferred Security
Beneficial Owners.
"INDEMNIFIED PERSON" means a Company Indemnified Person or a
Fiduciary Indemnified Person.
"INDENTURE" means the Indenture dated, as of _________ __, 1999,
between the Debenture Issuer and the Debenture Trustee, as amended or
supplemented 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.
"INVESTMENT COMPANY EVENT" has the meaning set forth in Annex I.
"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.
"OFFICERS' CERTIFICATE" means, with respect to any Person, a
certificate signed by any two of the following: the Chairman, a Vice Chairman,
the Chief Executive Officer, the President, the Chief Financial Officer, a Vice
President, the Comptroller, the Secretary or an Assistant Secretary 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 Officers'
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 Officers'
Certificate;
(c) a statement that each such officer has made such examination
or investigation as, in such officer's opinion, is necessary to enable
such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who may
be 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 _________ __, 1999 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).
"PROSPECTUS" has the meaning set forth in Section 3.6(b)(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).
"REGULATORY CAPITAL EVENT" has the meaning set forth in Annex 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 DELAWARE TRUSTEE" has the meaning set forth in Section
5.7(b)(ii).
"SUCCESSOR ENTITY" has the meaning set forth in Section
3.15(b)(i).
"SUCCESSOR PROPERTY TRUSTEE" has the meaning set forth in Section
3.8(f)(ii).
"SUPER MAJORITY" has the meaning set forth in Section 2.6(a)(ii).
"TAX EVENT" has the meaning set forth in Annex I.
"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
7
<PAGE>
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.
"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).
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"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.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement for the
initial offering and sale of Preferred Securities in the form of Exhibit C.
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
conflicts with the duties imposed by ss.ss. 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 Trust's classification as a grantor trust for
United States federal income tax purposes or 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 10 Business 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
ss.ss. 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,
2000, the Property Trustee shall provide to the Holders of the Preferred
Securities such reports dated as of such May 15 as are required by ss. 313 of
the Trust Indenture Act, if any, in the form and in the manner provided by ss.
313 of the Trust Indenture Act. The Property Trustee shall also comply with the
requirements of ss. 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 ss. 314 of the Trust Indenture Act (if any) and
the compliance certificate required by ss. 314 of the Trust Indenture Act in the
form, in the manner and at the times required by ss. 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 ss. 314(c) of the Trust Indenture Act. Any certificate
or opinion required to be given by an officer pursuant to ss. 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 ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 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:
(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
10
<PAGE>
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 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 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, each Holder 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 until 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 ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such
ss.ss. 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
ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 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 (as such term is defined in the Indenture) actually
known to a Responsible Officer, transmit by mail, first class postage prepaid,
to the Holders of the Preferred Securities, the Administrative Trustees and the
Sponsor, notices of all Defaults with respect to the Securities actually known
to a Responsible Officer, unless such Defaults have been cured before the giving
of such notice; 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
11
<PAGE>
Officer in good faith determines that the withholding of such notice is in the
interests of the Holders. 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.
(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, each as defined in
the Indenture) and 5.01(b) of the Indenture provided that the Property
Trustee is the Paying Agent under the Indenture; or
(ii) any default as to which the Property Trustee shall
have received written notice at the corporate trust office of the
Property Trustee and such notice references the Preferred Securities and
this Declaration or of which a Responsible Officer charged with the
administration of the Declaration shall have actual knowledge.
ARTICLE III
ORGANIZATION
SECTION 3.1 NAME.
The Trust is named "Independent Capital Trust II" 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 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 that are necessary 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
12
<PAGE>
undertaken) any activity that would cause the Trust not to be classified for
United States federal income tax purposes as a grantor trust.
The Trust will be classified as a grantor trust for United States
federal income tax purposes under Subpart E of Subchapter J of the Code,
pursuant to which the owners of the Preferred Securities and the Common
Securities will be the owners of the Trust for United States federal income tax
purposes, and such owners will include directly in their gross income the
income, gain, deduction or loss of the Trust as if the Trust did not exist. By
the acceptance of this Trust, none of the Trustees, the Sponsor or the Holders
of the Securities will take any position which is contrary to the classification
of the Trust as a grantor trust for United States federal income tax purposes.
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 may be otherwise provided in this Declaration, legal
title to all assets of the Trust shall be vested in the Property Trustee for the
benefit of the Trust and the Holders. 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 and pursuant to the Underwriting Agreement; 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) 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, to:
13
<PAGE>
(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 on Form S-3(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 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 ss. 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Preferred 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 this
Declaration and the Securities;
14
<PAGE>
(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 to conduct the services that the Administrative Trustees have
authority to conduct directly 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 ss. 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 necessary 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 or causing each Holder to
be treated as owning an undivided beneficial interest in the Debentures;
and
15
<PAGE>
(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;
provided that such action does not adversely affect the interest of the Holders;
(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 may 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;
(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;
16
<PAGE>
(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 (A) 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, and (B) an Opinion
of Counsel from a firm recognized to be experts in such matters, to the
effect that the amendment, modification or termination will not cause
more than an insubstantial risk that the Trust will be deemed to be an
investment company required to be registered under the Investment
Company Act of 1940, as amended.
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:
(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
17
<PAGE>
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 is rated in one of four highest rating categories by a
"nationally recognized statistical rating organization", as that term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
(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 set forth in Sections 2.7 and 8.1
hereof.
(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 this Declaration and 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 (each as defined in
Indenture), 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
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. If the
Property Trustee fails to declare the principal of all of the Debentures due and
payable upon an Event of Default (as defined in the Indenture), so long as the
Property Trustee is holding the Debentures on behalf of the Trust, the Holders
of at least 25% in liquidation amount of the Preferred Securities then
outstanding will have the right to declare the Debentures immediately due and
payable. Except as provided in this Section 3.8(e), the Holders of Preferred
Securities will not be able to exercise directly any other remedy available to
the holders of the Debentures.
18
<PAGE>
(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, including without limitation, its rights under the
Indenture 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 ss. 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 ss. 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 Trustee shall 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.
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
19
<PAGE>
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 (but need not confirm or
investigate the accuracy of mathematical calculations or other
facts stated therein);
(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 upon which such judgment was made;
(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 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
20
<PAGE>
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 act, omission, default or misconduct
of the Administrative Trustees or the Sponsor; and
(ix) the Property Trustee shall not be deemed to have
notice of any Event of Default unless a Responsible Officer of the
Property Trustee has actual knowledge thereof or unless written notice
of any event which is in fact such a default is received by the Property
Trustee at the Corporate Trust Office of the Property Trustee.
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;
21
<PAGE>
(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 or 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
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 Property Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Trust,
personally or by agent or attorney at the sole cost of the Sponsor and
shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation;
22
<PAGE>
(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, custodian, nominee 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;
(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;
(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;
(xiii) the rights, privileges, protections, immunities and
benefits given to the Property Trustee, including, without limitation,
its right to be indemnified, are extended to, and shall be enforceable
by, the Property Trustee in each of its capacities hereunder, and to
each agent, custodian and other Person employed to act hereunder; and
(xiv) 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 this Declaration or
is unsure of the application of any provision of this Declaration, and
the matter is not one on which the Holders are, under this Declaration,
entitled to vote, then the Property Trustee may take the action as is
directed by, and, if not so directed, may take action as it deems
advisable and in the best interests
23
<PAGE>
of, the Holders and will have no liability except for its own bad faith,
negligence or willful misconduct.
(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, or any other duties or responsibilities except as
expressly stated in this Section 3.11. 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 ss.3807 of the Business Trust Act; PROVIDeD THat,
the Delaware Trustee shall have the power and authority and is hereby authorized
to execute and file with the Secretary of State of the State of Delaware any
certificate required to be filed under the Business Trust Act, except as
provided in Section 8.1(b). 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.
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, 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 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.
24
<PAGE>
SECTION 3.14 DURATION OF TRUST.
The Trust, unless dissolved pursuant to the provisions of Article
VIII hereof, shall continue without dissolution until _________ __, 2030.
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) of this Declaration or Sections 3 and 4 of Annex I.
(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 Preferred Securities or 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, 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;
25
<PAGE>
(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);
(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; and
(C) the Trust will continue to be, or the Successor
Entity will be, classified as a grantor trust for United States
federal income tax purposes;
(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>
SECTION 3.16 PROPERTY TRUSTEE MAY FILE PROOFS OF CLAIM
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Securities or the property of the Trust or of such other obligor or
their creditors, the Property Trustee (irrespective of whether any Distributions
on the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities (or, if the
Securities are original issue discount Securities, such portion of the
liquidation amount as may be specified in the terms of such Securities)
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Property Trustee (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Property Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding; and
(b) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement adjustment or compensation
affecting the Securities or the rights of any Holder thereof or to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
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.
27
<PAGE>
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 to prepare and file the
Registration Statement with the Commission, including any amendments thereto and
to pay any registration fees in connection therewith;
(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 National Market System or any other
securities exchange or 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 under Section 3.8(e) of the Declaration and Section 5(b) of Annex I,
in the event that a failure of the Trust to pay Distributions on the Preferred
Securities is attributable to the failure of the Debenture Issuer 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 and the Sponsor irrevocably waives any right or remedy to require
that any such Holder take any action against the Trust or any other Person
before proceeding against the Sponsor.
28
<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 Section 3807(a) of the Business Trust Act and any other applicable law,
PROVIDED THAT, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee, the Person
theretofore serving as Delaware Trustee (if other than the Property Trustee)
automatically shall cease to be a Trustee, the Property
29
<PAGE>
Trustee promptly shall provide to the Person theretofore serving as Delaware
Trustee written notice of the same (in relying on which the Person theretofore
serving as Delaware Trustee shall be fully justified and protected), the number
of Trustees automatically shall be reduced by one (1), the Property Trustee
promptly shall cause the certificate of trust of the Trust to be amended as
necessary, 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 ss. 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 ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 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.
30
<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 Department
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; PROVIDED THAT the Registration Statement,
including any amendment thereto, shall be signed by all of the Administra tive
Trustees.
(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.
31
<PAGE>
SECTION 5.6 DELAWARE TRUSTEE.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
23 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 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 its or
his successor shall have been appointed or until his death or its dissolution,
or until his or its removal or resignation. Any Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
signed by the Trustee and delivered to the Sponsor and the Trust, which
32
<PAGE>
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, at the expense of the Sponsor, petition any court of competent
jurisdiction for appointment of a Successor Property Trustee or Successor
Delaware Trustee, as applicable. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, and 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.
(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.
(h) Any successor to an Administrative Trustee shall be an
officer, director, employee or Affiliate of the Sponsor.
33
<PAGE>
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 Section 5.2, 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 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 and without notice 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.
34
<PAGE>
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 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.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 DISTRIBUTIONS.
Holders shall receive Distributions in accordance with the
applicable terms of the relevant Holder's Securities. Distributions shall be
made on the Preferred Securities and the Common Securities in accordance with
the preferences set forth in their respective terms. If and to the extent that
the Debenture Issuer makes a payment of interest (including Compounded Interest
and Additional Sums, each as defined in the Indenture) 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.
35
<PAGE>
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 and the terms of the Securities, the
Preferred Securities Guarantee, the Indenture and the Debentures.
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 Administrative Trustees, 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 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.
36
<PAGE>
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,
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. The Preferred 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.
37
<PAGE>
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 Property 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.
(c) DEFINITIVE PREFERRED SECURITIES. Except as provided in
Section 7.9 or 9.2(d), 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 $10 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 Administrative Trustees on behalf of 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 Administrative Trustees on behalf of
the Trust may change any Paying Agent, Registrar or co-registrar without prior
notice to any Holder. The Paying Agent or Registrar shall be permitted to resign
as Paying Agent or Registrar, as the case may be, upon 30 days' written notice
to the Administrative Trustees. The Administrative Trustees on behalf of the
Trust shall notify the Property Trustee of the name and address of any Agent not
a party to this Declaration. If the Administrative Trustees on behalf of 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.
38
<PAGE>
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 monies previously held by it. 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.
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.
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
canceled 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 protected purchaser.
If Preferred Securities are considered paid in full in accordance
with the terms of this Declaration, they cease to be outstanding and
Distributions on them shall cease to accumulate.
Except as provided in Section 7.8, 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.
39
<PAGE>
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.
SECTION 7.9 DEFINITIVE SECURITIES.
(a) 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.
(b) 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 Preferred Securities of authorized denominations
in the form of certificated Preferred Securities. Any portion of a Global
Preferred Security so transferred pursuant to this Section 7.9(b) shall be
registered in such names as the Clearing Agency shall direct.
(c) Subject to the provisions of Section 7.9(b), 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.
(d) In the event of the occurrence of any of the events specified
in Section 7.9(a), the Trust will promptly make available to the Property
Trustee a reasonable supply of certificated Preferred Securities in fully
registered form without distribution coupons.
(e) Payments on the Preferred Securities that are not held by the
Depositary will be made by check mailed to the address of the holder certified
thereto at the address which appears on the register.
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
canceled 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
DISSOLUTION AND TERMINATION OF TRUST
SECTION 8.1 DISSOLUTION AND TERMINATION OF TRUST.
(a) The Trust shall automatically dissolve and be wound up in
accordance with applicable law:
(i) upon the occurrence of an Event of Default with respect
to the Sponsor as described in Section 501(d) or (e) of the Indenture;
(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) based upon an election by the Sponsor to dissolve the
Trust, following the distribution of the Debentures from the Trust to
the Holders in exchange for all of the Securities;.
(iv) upon the entry of a decree of judicial dissolution of
the Sponsor or the Trust by a court of competent jurisdiction;
41
<PAGE>
(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), but within 30 days of such event, notice of such
dissolution shall be given to the Holders and upon completion of the winding up
of Trust, the Administrative Trustees shall file a certificate of cancellation
with the Secretary of State of the State of Delaware and the Trust shall
terminate.
(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. To the fullest extent permitted by applicable law,
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 Registrar or co-registrar, 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 bound by this Declaration.
(c) The Holder of the Common Securities may not transfer the
Common Securities except (a) in connection with transactions permitted under
Section 10.01 of the Indenture, or (b) to the Sponsor or an Affiliate thereof in
compliance with applicable law (including the Securities Act and applicable
state securities and blue sky laws); PROVIDED THAT, any such transfer is
42
<PAGE>
subject to the condition precedent that the transferor obtain the written
opinion of qualified independent counsel experienced in such matters that such
transfer would not cause more than an insubstantial risk that:
(i) the Trust would not be classified for United States
federal income tax purposes as a grantor trust and each Holder of
Securities would not be treated as owning an undivided beneficial
interest in the Debentures; and
(ii) the Trustee would be an Investment Company or the
transferee would become an Investment Company.
To the fullest extent permitted by law, any attempted transfer of the Common
Securities other than as set forth in the immediately preceding sentence shall
be void. 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) TRANSFER AND EXCHANGE OF GLOBAL PREFERRED SECURITIES. The
transfer and exchange of Global Preferred Securities or beneficial interests
therein shall be effected through the
43
<PAGE>
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.
(c) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL PREFERRED
SECURITIES. Notwithstanding any other provisions of this Declaration (other than
the provisions set forth in this Section 9.2 and subsection (a) 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.
(d) AUTHENTICATION OF DEFINITIVE PREFERRED SECURITIES. If at any
time:
(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) there occurs a Default or an Event of Default which
is continuing, or
(iii) the Trust (by the Administrative Trustees), 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 an Administrative Trustee on behalf of 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.
(e) 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.
(f) OBLIGATIONS WITH RESPECT TO TRANSFERS OF PREFERRED
SECURITIES.
(i) To permit registrations of transfers, an Administrative
Trustee on behalf of the Trust shall execute and the Property Trustee
shall authenticate Definitive
44
<PAGE>
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 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.
(g) 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
45
<PAGE>
information furnished by the Clearing 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 (subject to the definition of "Holder" contained herein) 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 Security Beneficial 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 or 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;
(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
46
<PAGE>
(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, unless and until
definitive, fully registered Preferred Securities certificates have been issued
to the Preferred Security Beneficial Owners pursuant to Section 7.9 or Section
9.2, 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 ceases to continue 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
(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.
47
<PAGE>
(c) Pursuant to ss. 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 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.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between any Covered Persons and Indemnified 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,
48
<PAGE>
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 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
49
<PAGE>
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 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). Notwith
standing the foregoing, no advance shall be made by the Debenture Issuer
if a determina tion 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
50
<PAGE>
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 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 Indemni fied Person and shall inure to
the benefit of the heirs, executors and administrators of such a person.
(b) To the fullest extent permitted by law, 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,
51
<PAGE>
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, the dissolution of the Trust and the satisfaction and
discharge of this Declaration.
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 compensa tion 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.
52
<PAGE>
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.
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
53
<PAGE>
accounts shall be designated by the Administrative Trustees; PROVIDED, HOWEVER,
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
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.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 AMENDMENTS.
(a) Except as otherwise provided in this Declaration (including
Section 7 of 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:
54
<PAGE>
(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 that the interests of any Holder of Securities
will not be materially affected by such amendment; 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;
(C) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company
Act; or
(D) cause a Tax Event.
(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;
(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
55
<PAGE>
(g) Notwithstanding Section 12.1(c), this Declaration may be
amended by the Sponsor, the Property Trustee and the Administrative Trustees
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;
PROVIDED, HOWEVER, that in each case such action shall not adversely affect the
interests of the Holders, and any such 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 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 Securities 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 there 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
56
<PAGE>
without a meeting and without prior notice 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 any action without a meeting
shall be given to Holders entitled to vote who have not consented to
such action in writing. The Administrative Trustees may specify that any
written ballot submitted to the Holder of Securities 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;
(iii) each meeting of the Holders shall be conducted by the
Administra tive 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 and without prior notice,
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, to the Holders of Securities and to the Sponsor at the
date of this Declaration, and each
57
<PAGE>
Successor Property Trustee represents and warrants to the Trust, to the Holders
of Securities, and to 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 Property Trustee satisfies the requirements set forth in
Section 5.3(a);
(c) 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);
(d) 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
(e) No consent, approval or authorization of, or registration
with or notice to, any 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, to the Holders of Securities and to the Sponsor at the
date of this Declaration, and each Successor Delaware Trustee represents and
warrants to the Trust, to the Holders of Securities, and to the Sponsor at the
time of the Successor Delaware Trustee's acceptance of its appointment as
Delaware Trustee that:
(a) The Delaware Trustee satisfies the requirements set forth in
Section 5.2 and, if it is not a natural person, 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
58
<PAGE>
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.
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 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 II
c/o Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Attention: Richard Seaman
Administrative Trustee
Telecopy: (781) 878-6100
59
<PAGE>
(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
Administrative Trustees and the Property Trustee):
The Bank of New York (Delaware)
23 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 Administra tive Trustees, the Delaware Trustee and the
Holders):
The Bank of New York
101 Barclay Street
21st Floor West
New York, New York 10286
Attention: Corporate Trust Department
Telecopy: (212) 815-5917
(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: (781) 878-6100
(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.
60
<PAGE>
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 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.
61
<PAGE>
IN WITNESS WHEREOF, the undersigned has caused these presents to
be executed as of the day and year first above written.
INDEPENDENT CAPITAL TRUST II
------------------------------------------
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:
---------------------------------------
Richard J. Seaman
Chief Financial Officer
62
<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 _______ __, 1999 (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. ________ __% Cumulative Trust
Preferred Securities of the Trust with an aggregate liquidation amount with
respect to the assets of the Trust of ____________ dollars ($_______) and each
with a liquidation amount with respect to the assets of the Trust of $10 per
security (if the underwriters exercise their Option and there is an Option
Closing Date (as such terms are defined in the Underwriting Agreement), then up
to an additional _____ Cumulative Trust Preferred Securities of the Trust with
an aggregate liquidation amount with respect to the assets of the Trust of
_____________ dollars ($______)), 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. ______ Common Securities of the Trust
with an aggregate liquidation amount with respect to the assets of the Trust of
______________ dollars ($_______), and a liquidation amount with respect to the
assets of the Trust of $10 per security (if the underwriters exercise their
Option and there is an Option Closing Date (as such terms are defined in the
Underwriting Agreement), then up to an additional _____ Common Securities of the
Trust with an aggregate liquidation amount with respect to the assets of the
Trust of _____________ dollars ($______)), are hereby designated for the
purposes of identification only as Common Securities. 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 $10 per
Security (the
I-1
<PAGE>
"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 ______ __, 1999, and will be payable quarterly in arrears on the last day
of March, June, September and December of each year, commencing on _______ __,
1999 (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 quarter on the
basis of the actual number of days elapsed in such 90-day quarter based on
30-day months. 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 on the Debentures by extending the interest payment
period at any time and from time to time 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 accrue with interest thereon (to the
extent permitted by applicable law) at the Coupon Rate compounded quarterly
during any such Extension Period. Prior to the termination of any such Extension
Period, the Debenture Issuer may further defer payments of interest by further
extending such Extension Period; PROVIDED THAT such further deferment shall only
be permitted to the extent that such Extension Period, together with all
extensions occurring both before and after such deferment, does not exceed 20
consecutive quarterly periods, including the first quarterly period during such
Extension Period, or extend beyond the Maturity Date of the Debentures. Payments
of deferred Distributions will be payable to Holders of record as they appear on
the books and records of the Trust on the record date for Distributions due at
the end of such 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.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust which for
so long as the Securities remain in book entry form, will be one Business Day
prior to the relevant Distribution Date and, in the event the Securities are not
in book entry form, will be the close of business on the 15th day of the month
in which the relevant Distribution Date occurs. 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 _______ __, 1999,
of the Debenture Issuer and the Trust relating to the Securities and the
Debentures. Payments in
I-2
<PAGE>
respect of Preferred Securities held in certificated form will be made by check
mailed or by wire 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 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 voluntary or involuntary dissolution or
termination of the Trust or the Sponsor otherwise gives notice of its election
to dissolve 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 $10 per
Security plus accumulated and unpaid Distributions thereon to the date of
payment (such amount being the "Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to that portion of
principal amount of Debentures to be contemporaneously redeemed in accordance
with their terms allocated to the Common Securities and the 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 Securities 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.
I-3
<PAGE>
4. REDEMPTION AND DISTRIBUTION.
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 de scribed 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").
In the case of an optional redemption, if fewer than all the
outstanding Securi ties 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 _________ __, 2004, upon not less than 30 days and not more
than 60 days written 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 or such other method as the Property
Trustee shall deem appropriate, subject to the receipt of prior approval of any
applicable regulatory agency if it is then required under applicable regulatory
requirements.
(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 and shall be continuing, 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 written 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 or such other method as the Property Trustee shall deem appropriate, in
each case subject to the receipt of prior approval of any applicable regulatory
agency if it is then required under applicable regulatory requirements.
"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
Investment Company Act of 1940, as amended, which change becomes effective on or
after the date of original issuance of the Preferred Securities of Independent
Capital Trust II.
A "Regulatory Capital Event" shall occur at any time that the
Sponsor shall have re ceived 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
I - 4
<PAGE>
of applicable regulatory agencies or (b) any official administrative
pronouncement or judicial deci sion interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of Declaration, the Preferred
Securities do not constitute, or within 90 days of the date thereof, will not
constitute, Tier I Capital (or its then equivalent) applied as if the Sponsor
(or its successor) were a bank holding company for purposes of the capital
adequacy guidelines of the Board of Governors of the Federal Reserve (or any
successor regulatory authority with jurisdiction over bank holding companies),
or any capital adequacy guidelines as then in effect and applicable to the
Sponsor; 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.
"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 the date
of the Declaration, 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.
(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 out standing, (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 (iii) any certificates repre senting Securities not held by the Clearing
Agency or its nominee (or any successor Clearing Agency or its nominee) will be
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
I - 5
<PAGE>
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 Redemp tion/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), or such other method
as the Property Trustee shall deem appropriate, 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 Property Trustee 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 Property
Trustee deems fair and appropriate in order that only Securities in
denominations of $10 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.
(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 con nection 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, pro vided
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 Trustee will 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 Re
I - 6
<PAGE>
demption/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 inter est 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 inter est 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 re demption. If payment of the
Redemption Price in respect of any Securities is improperly withheld or
refused and not paid by the Sponsor as guarantor pursuant to the relevant
Securi 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
there of, 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.
(g) 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.
I - 7
<PAGE>
(h) So long as any Debentures are held by the Property
Trustee, subject to the requirement of the Property Trustee obtaining a tax
opinion in certain circumstances set forth in the last sentence of this
paragraph, the Holders of a majority in Liquidation Amount of the Preferred
Securities have the right to (i) direct the time, method and place of conducting
any proceeding for any remedy available to the Debenture Trustee, or direct the
exercise of 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, however, 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, except with respect to directing the time, method and place of
conducting a proceeding for a remedy, 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 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, and the amount of the payment will be based on the Holder's pro rata
share of the amount due and owing on all Preferred Securities. In connection
with such Direct Action, 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 and without prior notice. The Administrative
Trustees will cause a notice of any meeting at which Holders of Preferred
Securities are entitled to vote, 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, (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote and (iii)
instructions for the delivery of proxies.
I - 8
<PAGE>
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.
6. VOTING RIGHTS - COMMON SECURITIES.
(a) Except as provided under Sections 6(b), 6(c), and 7 and 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
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, subject to Section 2.6 of the Declaration and only after any Event of
Default with respect to the Preferred Securities has been cured, waived or
otherwise eliminated, 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
I - 9
<PAGE>
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 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 without prior notice . The Administrative Trustees
will cause a notice of any meeting at which Holders of Common Securities are
entitled to vote 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, (ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote and (iii) instructions for
the delivery of proxies.
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 the interests of any Holder. Any amendments of the Declaration pursuant
to the immediately preceding sentence 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
I - 10
<PAGE>
(ii) receipt by the Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not affect the Trust's status as a grantor trust for
United States federal income tax purposes or the Trust's exemption from status
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 Property Trustee on behalf of the Trust may make such adjustments
as may be appropriate in order that only securities in authorized denominations
shall be redeemed.
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 Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.
I - 11
<PAGE>
11. NO PREEMPTIVE RIGHTS.
The Holders shall have no preemptive or similar rights to subscribe
for any additional securities in the Trust. The issuance of the Securities is
not subject to any preemptive or similar rights.
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 - 12
<PAGE>
EXHIBIT A-1
FORM OF ____% CUMULATIVE TRUST PREFERRED SECURITY CERTIFICATE
[FACE OF SECURITY]
[IF ISSUED AS A GLOBAL SECURITY INSERT:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE DECLARATION
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 DECLARATION 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.
UNLESS THIS PREFERRED SECURITY CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY PREFERRED SECURITY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHO RIZED
REPRESENTATIVE OF THE DEPOSITORY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSONS IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
A1-1
<PAGE>
Number of
Preferred Securities:________ CUSIP NO. ___________
Certificate Evidencing ____% Cumulative Trust Preferred Securities
of
Independent Capital Trust II
____% Cumulative Trust Preferred Securities
(liquidation amount $10 per Preferred Security)
Independent Capital Trust II, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Cede & Co. (the "Holder") is the registered owner of __________ Preferred
Securities (as defined below) ($____________ in aggregate liquidation amount of
Preferred Securities) of the Trust representing undivided beneficial interests
in the assets of the Trust designated the ____% Cumulative Trust Preferred
Securities (liquidation amount $10 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 ________ __, 1999, 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 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.
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.
This Certificate shall be governed by and construed in accordance
with the laws of the State of Delaware, without regard to principles of conflict
of laws.
A1-2
<PAGE>
IN WITNESS WHEREOF, the Trust has duly executed this certificate
this _________ day of ___________ 1999.
INDEPENDENT CAPITAL TRUST II
By:
------------------------------------------
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: _____ __, 1999
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 $10 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
_______ __, 1999 and will be payable quarterly in arrears, on the last day of
March, June, September and December of each year, commencing on _____ __, 1999,
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 quarter, the number of days elapsed in such 90-day quarter
based on 30-day months. 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) 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 further
deferment shall only be permitted to the extent that such Extension Period,
together with all extensions occurring both before and after such deferment,
does 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 dissolve the
Trust and cause the 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.
A1-4
<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 Exchange Act of 1934, as amended.
A1-5
<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 Number Increase in Number Securities Remaining
of Preferred of Preferred after such Decrease or Notation by
Securities Securities Increase Registrar
- --------------------------------------------------------------------------------
* Append to Global Preferred Securities only.
A1-6
<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 SECURITY (OR ANY PREDECESSOR OF THIS 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 INSTITU TIONAL 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 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.
A2-1
<PAGE>
THIS COMMON SECURITY IS NOT TRANSFERABLE EXCEPT AS SET FORTH IN
SECTION 9.1(c) OF THE AMENDED AND RESTATED DECLARATION OF TRUST OF INDEPENDENT
CAPITAL TRUST II, DATED AS OF _______ __, 1999, AS THE SAME MAY BE AMENDED FROM
TIME TO TIME.
A2-2
<PAGE>
Certificate No. 1
Certificate Evidencing Common Securities
of
Independent Capital Trust II
____% Common Securities
(liquidation amount $10 per Common Security)
Independent Capital Trust II, a statutory business trust formed
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Independent Bank Corp. (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
$10 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 ________ __,
1999, 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. Capitalized 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 Holder 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.
This Certificate shall be governed by and construed in accordance
with the laws of the State of Delaware, without regard to principles of
conflicts of laws.
A2-3
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this
____ day of _________, 1999.
INDEPENDENT CAPITAL TRUST II
By:
---------------------------------------
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 $10
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
______ __, 1999 and will be payable quarterly in arrears, on the last day of
March, June, September and December of each year, commencing on _____ __, 1999,
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 quarter, the number of days elapsed in such 90-day quarter
based on 30-day months. 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) 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 further deferment shall only
be permitted to the extent that such Extension Period, together with all
extensions occurring both before and after such deferment, does 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 dissolve the
Trust and cause the 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.
A2-5
<PAGE>
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.
---------------------
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)
A2-6
<PAGE>
EXHIBIT B
SPECIMEN OF DEBENTURE
<PAGE>
EXHIBIT C
UNDERWRITING AGREEMENT
<PAGE>
EXHIBIT 4.6
---------------------------------------------------
TRUST PREFERRED SECURITIES
GUARANTEE AGREEMENT
INDEPENDENT BANK CORP.
DATED AS OF ______ __, 1999
---------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINITIONS AND INTERPRETATION............................. 1
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION........................... 5
SECTION 2.2 LISTS OF HOLDERS OF TRUST PREFERRED 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........... 7
SECTION 2.6 GUARANTEE EVENTS OF DEFAULT; WAIVER........................ 7
SECTION 2.7 GUARANTEE 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
i
<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....................................... 16
SECTION 5.6 SUBROGATION................................................ 16
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................................................ 18
SECTION 8.2 INDEMNIFICATION............................................ 18
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 SUCCESSORS AND ASSIGNS..................................... 18
SECTION 9.2 AMENDMENTS................................................. 19
SECTION 9.3 NOTICES.................................................... 19
SECTION 9.4 BENEFIT.................................................... 20
SECTION 9.5 GOVERNING LAW.............................................. 20
ii
<PAGE>
TRUST PREFERRED SECURITIES GUARANTEE AGREEMENT
This Trust Preferred Securities Guarantee Agreement (the "Trust
Preferred Securities Guarantee"), dated as of _________ __, 1999, 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, 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
II, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of _______ __, 1999, among the trustees of the
Issuer named therein, 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, _______ trust preferred securities, having an
aggregate liquidation amount of $__________, such trust preferred securities
being designated the ___% Cumulative Trust Preferred Securities (collectively
the "Trust Preferred Securities"); 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 herein) 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.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINITIONS AND INTERPRETATION
In this Trust Preferred Securities Guarantee, unless the context
otherwise requires:
<PAGE>
(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) a term 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.
"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 Trust
Preferred Securities Guarantee is located at 101 Barclay Street, New York, New
York 10286.
2
<PAGE>
"COVERED PERSON" means any Holder or beneficial owner of Trust
Preferred Securities.
"DEBENTURES" means the series of subordinated deferrable interest
debentures of the Guarantor designated the ____% Junior Subordinated Deferrable
Interest Debentures due ______ __, 2029 held by the Property Trustee (as defined
in the Declaration) of the Issuer.
"GUARANTEE 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
dissolution or winding up 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 (in
either case, the "Liquidation Distribution"). 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 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 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.
3
<PAGE>
"INDENTURE" means the Indenture dated as of _____ __, 1999, 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, the terms of the
Preferred Securities 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.
In determining whether the Holders of the requisite amount of Trust Preferred
Securities have voted, Trust Preferred Securities which are owned by the
Guarantor or any Affiliate of the Guarantor or any other obligor on the Trust
Preferred Securities shall be disregarded for the purpose of any such
determination.
"OFFICERS' CERTIFICATE" means, with respect to the Guarantor, a
certificate signed by any two of the following: the Chairman, a Vice Chairman,
the Chief Executive Officer, the President, a Vice President, the Comptroller,
the Secretary or an Assistant Secretary 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.
"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, in each case similar to the Issuer, including but not limited
to Independent Capital Trust I.
"OTHER GUARANTEES" means all guarantees issued or to be issued by
the Guarantor with respect to trust preferred securities similar to the Trust
Preferred Securities issued by other
4
<PAGE>
trusts established or to be established by the Guarantor, in each case similar
to the Issuer, including but not limited to Independent Capital Trust I.
"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 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 Preferred Securities Guarantee
and thereafter means each such Successor Trust Preferred Securities Guarantee
Trustee.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.
"TRUST SECURITIES" means the Common Securities and the Trust
Preferred Securities, collectively.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 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
5
<PAGE>
(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.
SECTION 2.2 LISTS OF HOLDERS OF TRUST PREFERRED 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 of the Trust Preferred Securities
("List of Holders") as of such date, (i) within 14 days after each record date
for payment of Distributions, as defined in the Declaration, 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 shall preserve, in as current a form as
is reasonably practicable, all information contained in a List of Holders given
to it, provided that it 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,
2000, 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 of the Trust Indenture Act (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.
6
<PAGE>
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 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 GUARANTEE EVENTS OF DEFAULT; WAIVER
The Holders of a Majority in liquidation amount of Trust
Preferred Securities may, by vote or by written consent, on behalf of all
Holders, waive any past Guarantee Event of Default and its consequences. Upon
such waiver, any such Guarantee Event of Default shall cease to exist, and any
Guarantee 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 Guarantee Event of
Default or impair any right consequent thereon.
SECTION 2.7 GUARANTEE EVENT OF DEFAULT; NOTICE
(a) The Trust Preferred Securities Guarantee Trustee shall,
within 90 days after the occurrence of a Guarantee Event of Default, mail by
first class postage prepaid, to all Holders, notices of all Guarantee Events of
Default 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 a
Guarantee Event of Default in the timing or 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 of the
Trust Preferred Securities Guarantee Trustee 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 Guarantee 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 Guarantee 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, her or its 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 a Guarantee 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 Guarantee Event of Default and after the curing of all
Guarantee 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 a Guarantee 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 Guarantee Event of
Default and after the curing or waiving of all such Guarantee 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
8
<PAGE>
Guarantee Trustee shall not be liable except for the performance
of such duties 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 (but need not
confirm or investigate the accuracy of mathematical calculations
or other facts stated therein);
(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 Trustee; provided
10
<PAGE>
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 a Guarantee 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,
custodian, nominee 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
11
<PAGE>
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
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.
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 a Guarantee 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 for fees and reimbursement of expenses which have 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 be absolute and
unconditional and shall remain in full force and effect until the entire
liquidation amount of all Trust Preferred Securities shall have been paid and
such obligations, covenants, agreements and duties shall in no way be affected
or impaired by reason of the happening from time to time of any event, including
without limitation the following, whether or not with notice to, or the consent
of, the Guarantor:
(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 Property Trustee or the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred
14
<PAGE>
on the Property Trustee or 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;
(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. No set-off, counterclaim, reduction or diminution of any obligation,
or any defense of any kind or nature that the Guarantor has or may have against
any Holder shall be available hereunder to the Guarantor against such Holder to
reduce the payments to it under this Trust Preferred Securities Guarantee.
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.
Notwithstanding the foregoing, if the Guarantor has failed to make a Guarantee
Payment, a Holder may directly institute a proceeding against the Guarantor for
enforcement of the Trust Preferred Securities Guarantee for such payment to the
Holder of the principal of or interest on the Debentures on or after the
respective due dates specified in the Debentures, and the amount of the payment
will be based on the Holder's pro rata share of the amount due and owing on all
of the Trust Preferred Securities. The Guarantor
15
<PAGE>
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 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, if
there shall have occurred a Guarantee Event of Default or an Event of Default,
or an event that, with the giving of notice or the lapse of time, or both, would
be a Guarantee Event of Default or an Event of Default then, prior to the
payment of all accrued interest on outstanding Debentures , 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, interest or premium, if any, on or repay or 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
16
<PAGE>
payments with respect to any guarantee by the Guarantor of the debt securities
of any Subsidiary (including under Other Guarantees) if such guarantee ranks
equal 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).
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, any Other Guarantee and any Other Common Securities Guarantee, (iii)
senior to the Guarantor's capital stock and (iv) effectively subordinated to the
liabilities and obligations of the Guarantor's subsidiaries. If an Event of
Default has occurred and is continuing, the rights of the holders of the Common
Securities to receive any payments shall be subordinated to the rights of the
Holders to receive Guarantee Payments hereunder.
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 and 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.
17
<PAGE>
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.
(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.
18
<PAGE>
SECTION 9.2 AMENDMENTS
Except with respect to any changes that do not 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.
Prior to executing any amendment hereto, the Trust Preferred
Securities Guarantee Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Trust Preferred Securities Guarantee Agreement.
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 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 II
c/o The Bank of New York
101 Barclay Street
21st Floor West
New York, New York 10286
Attention: Corporate Trustee Administration
Telecopy: (212) 815-5917
19
<PAGE>
(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, the Guarantor 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: (781) 878-6100
(d) If given to any Holder, at the address set forth on the books
and records of the Issuer.
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 9.4 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 9.5 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:
------------------------------------------
Richard J. Seaman
Chief Financial Officer
THE BANK OF NEW YORK, as Trust Preferred
Securities Guarantee Trustee
By:
------------------------------------------
Name:
Title:
21
<PAGE>
EXHIBIT 5.1
Law Offices
ELIAS, MATZ, TIERNAN & HERRICK L.L.P.
12th Floor
734 15th Street, N.W.
Washington, D.C. 20005
Telephone (202) 347-0300
October 28, 1999
Board of Directors
Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
In connection with the registration under the Securities Act of 1933, as
amended (the "Act"), of up to $23,000,000 aggregate principal amount of Junior
Subordinated Deferrable Interest Debentures (the "Junior Subordinated
Debentures") of Independent Bank Corp., a Massachusetts corporation (the
"Corporation"), up to $23,000,000 aggregate liquidation amount of Cumulative
Trust Preferred Securities (the "Trust Preferred Securities") of Independent
Capital Trust II, a business trust created under the laws of the State of
Delaware (the "Issuer"), and the Guarantee with respect to the Trust Preferred
Securities (the "Guarantee") to be executed and delivered by the Corporation for
the benefit of the holders from time to time of the Trust Preferred Securities,
we, as your counsel, have examined such corporate records, certificates and
other documents, and such questions of law, as we have considered necessary or
appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, when:
(i) the Registration Statement relating to the Junior Subordinated
Debentures, the Trust Preferred Securities and the Guarantee has become
effective under the Act;
(ii) the Guarantee Agreement relating to the Guarantee with respect
to the Trust Preferred Securities of the Issuer has been duly executed and
delivered;
(iii) the Junior Subordinated Debentures have been duly executed and
authenticated in accordance with the Indenture and issued and delivered as
contemplated in the Registration Statement; and
<PAGE>
Board of Directors
October 28, 1999
Page 2
(iv) the Trust Preferred Securities have been duly executed in
accordance with the Amended and Restated Declaration of Trust of the
Issuer and issued and delivered as contemplated in the Registration
Statement,
the Junior Subordinated Debentures and the Guarantee relating to the Trust
Preferred Securities of the Issuer will constitute valid and legally binding
obligations of the Corporation, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
We understand that you have received an opinion regarding the Trust
Preferred Securities from Richards, Layton & Finger, P.A., special Delaware
counsel for the Corporation and the Issuer. We are expressing no opinion with
respect to the matters contained in such opinion.
Also, we have relied as to certain matters on information obtained from
public officials, officers of the Corporation and other sources believed by us
to be responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Legal
Matters" in the Prospectus. In giving such consent, we do not thereby admit that
we are in the category of persons whose consent is required under Section 7 of
the Act.
Very truly yours,
ELIAS, MATZ, TIERNAN & HERRICK L.L.P
By: /s/ Norman B. Antin
--------------------------------------
Norman B. Antin, a Partner
<PAGE>
Exhibit 5.2
[Letterhead of Richards, Layton & Finger, P.A.]
October 28, 1999
Independent Capital Trust II
c/o Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Re: INDEPENDENT CAPITAL TRUST II
Ladies and Gentlemen:
We have acted as special Delaware counsel for Independent Bank
Corp., a Massachusetts corporation (the "Company"), and Independent Capital
Trust II, a Delaware business trust (the "Trust"), in connection with the
matters set forth herein. At your request, this opinion is being furnished to
you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of October
22, 1999 (the "Certificate"), as filed in the office of the Secretary of State
of the State of Delaware (the "Secretary of State") on October 22, 1999;
(b) The Declaration of Trust of the Trust, dated as of October
22, 1999, among the Company and the trustees of the Trust named therein;
(c) A form of Amended and Restated Declaration of Trust of the
Trust (including Annex I and Exhibits A-1 and A-2) (the "Declaration"), to be
entered into among the Company, as sponsor, the trustees of the Trust named
therein, and the holders, from time to time, of undivided beneficial interests
in the assets of the Trust, attached as an exhibit to the Registration Statement
(as defined below);
<PAGE>
Independent Capital Trust II
October 28, 1999
Page 2
(d) The Registration Statement on Form S-3 (the "Registration
Statement"), including a prospectus (the "Prospectus"), relating to the trust
preferred securities of the Trust representing undivided beneficial interests in
the assets of the Trust (each, a "Preferred Security" and collectively, the
"Preferred Securities"), as proposed to be filed by the Company and the Trust
with the Securities and Exchange Commission on or about October 28, 1999; and
(e) A Certificate of Good Standing for the Trust, dated
October 28, 1999, obtained from the Secretary of State.
Capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a) through (e) above.
In particular, we have not reviewed any document (other than the documents
listed in paragraphs (a) through (e) above) that is referred to in or
incorporated by reference into the documents reviewed by us. We have assumed
that there exists no provision in any document that we have not reviewed that is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Declaration and the Certificate are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a preferred security
certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Declaration and the Registration
Statement, and (vii) that the Preferred Securities are issued and sold to the
<PAGE>
Independent Capital Trust II
October 28, 1999
Page 3
Preferred Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in
good standing as a business trust under the Business Trust Act.
2. The Preferred Securities will represent valid and, subject
to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Preferred Security
Holders may be obligated to make payments as set forth in the Declaration.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. In
addition, we hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus. In giving the foregoing consents, we do not thereby
admit that we come within the category of Persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
BJK/JRS
<PAGE>
EXHIBIT 8
Law Offices
ELIAS, MATZ, TIERNAN & HERRICK L.L.P.
12th Floor
734 15th Street, N.W.
Washington, D.C. 20005
Telephone (202) 347-0300
October 28, 1999
Board of Directors
Independent Bank Corp.
288 Union Street
Rockland, Massachusetts 02370
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
As special federal tax counsel to Independent Capital Trust II (the
"Issuer") and Independent Bank Corp. in connection with the issuance by the
Issuer of up to $23,000,000 of its Cumulative Trust Preferred Securities
pursuant to the prospectus (the "Prospectus") contained in the Registration
Statement, and assuming the operative documents described in the Prospectus will
be performed in accordance with the terms described therein, we hereby confirm
to you our opinion as set forth under the heading "Certain Federal Income Tax
Consequences" in the Prospectus, subject to the limitations set forth therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Certain
Federal Income Tax Consequences" in the Prospectus. In giving such consent, we
do not thereby admit that we are in the category of persons whose consent is
required under Section 7 of the Act.
Very truly yours,
ELIAS, MATZ, TIERNAN & HERRICK L.L.P
By: /s/ Norman B. Antin
--------------------------------
Norman B. Antin, a Partner
<PAGE>
Exhibit 12.1
INDEPENDENT BANK CORP.
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS
<TABLE>
<CAPTION>
Year to Date 1998 1997 1996 1995 1994
9/30/99 (Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Net Income (loss) 12,386 16,139 14,158 11,597 10,387 8,113
Income tax expense (benefit) 5,423 7,804 7,326 6,153 4,729 1,533
------ ------ ------ ------ ------ ------
Pretax earnings (loss) 17,809 23,943 21,484 17,750 15,116 9,646
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Fixed Charges:
One-third of rental expense
which approximated the interest
factor 423 667 767 768 682 509
Interest on borrowed funds 14,609 18,137 9,881 4,684 3,101 1,562
------ ------ ------ ------ ------ ------
Total Fixed charges 15,032 18,804 10,648 5,452 3,783 2,071
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Earnings (for ratio calculation) 32,841 42,747 32,132 23,202 18,899 11,717
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Ratio of earnings to fixed
charges 2.18 2.27 3.02 4.26 5.00 5.66
</TABLE>
<PAGE>
Exhibit 12.2
INDEPENDENT BANK CORP.
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
INCLUDING INTEREST ON DEPOSITS
<TABLE>
<CAPTION>
Year to Date 1998 1997 1996 1995 1994
9/30/99 (Dollars in Thousands)
<S> <C> <C> <C> <C> <C> <C>
Net Income (loss) 12,386 16,139 14,158 11,597 10,387 8,113
Income tax expense (benefit) 5,423 7,804 7,326 6,153 4,729 1,533
------ ------ ------ ------ ------ ------
Pretax earnings (loss) 17,809 23,943 21,484 17,750 15,116 9,646
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Fixed Charges:
One-third of rental expense
which approximated the interest
factor 423 667 767 768 682 509
Interest on borrowed funds 37,620 49,569 41,578 32,354 29,143 22,029
------ ------ ------ ------ ------ ------
Total Fixed charges 38,043 50,236 42,345 33,122 29,825 22,538
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Earnings (for ratio calculation) 55,852 74,179 63,829 50,872 44,941 32,184
------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------
Ratio of earnings to fixed
charges 1.47 1.48 1.51 1.54 1.51 1.43
</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 (No. 333-XXXXX), filed on Form S-3, of
our reports dated January 27, 1999 included in Independent Bank Corp.'s Form
10-K for the year ended December 31, 1998 and to all references to our firm
included in this registration statement.
/s/ Arthur Andersen LLP
Boston, Massachusetts
October 26, 1999
<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.)
One 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.)
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.
-2-
<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 21st day of October, 1999.
THE BANK OF NEW YORK
By: /s/ MICHAEL CULHANE
--------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
<PAGE>
Exhibit 7
- ------------------- --------------------- ----------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1999,
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>
<S> <C>
ASSETS
Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $ 5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income...............38,028,772
LESS: Allowance for loan and
lease losses............568,617
LESS: Allocated transfer risk
reserve........................16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
-----------
Total assets........................................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing.......................10,626,811
Interest-bearing..........................15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing..........................156,471
Interest-bearing..........................20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
---------
Total liabilities...................................... 58,624,027
----------
----------
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
-----------
Total equity capital................................... 5,912,899
-----------
Total liabilities and equity capital................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
I, Thomas J. Mastro, 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.
Thomas J. Mastro
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.
---
Thomas A. Reyni /
Alan R. Griffith / Directors
Gerald L. Hassell /
---
- -------------------- ---------------------- ----------------------
<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.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------
INDEPENDENT CAPITAL TRUST II
(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.)
288 Union Street
Rockland, Massachusetts 02370
(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.)
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.
-2-
<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 21st day of October, 1999.
THE BANK OF NEW YORK
By: /s/ MICHAEL CULHANE
--------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
<PAGE>
Exhibit 7
- ------------------- --------------------- ----------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1999,
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>
<S> <C>
ASSETS
Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $ 5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income...............38,028,772
LESS: Allowance for loan and
lease losses............568,617
LESS: Allocated transfer risk
reserve........................16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
-----------
Total assets........................................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing.......................10,626,811
Interest-bearing..........................15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing..........................156,471
Interest-bearing..........................20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
---------
Total liabilities...................................... 58,624,027
----------
----------
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
-----------
Total equity capital................................... 5,912,899
-----------
Total liabilities and equity capital................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
I, Thomas J. Mastro, 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.
Thomas J. Mastro
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.
---
Thomas A. Reyni /
Alan R. Griffith / Directors
Gerald L. Hassell /
---
- -------------------- ---------------------- ----------------------
<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.)
One 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 the Trust Preferred Securities of Independent Capital Trust II
(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.)
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.
-2-
<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 21st day of October, 1999.
THE BANK OF NEW YORK
By: /s/ MICHAEL CULHANE
--------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
<PAGE>
Exhibit 7
- ------------------- --------------------- ----------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1999,
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>
<S> <C>
ASSETS
Dollar Amounts
In Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.. $ 5,597,807
Interest-bearing balances........................... 4,075,775
Securities:
Held-to-maturity securities......................... 785,167
Available-for-sale securities....................... 4,159,891
Federal funds sold and Securities purchased under
agreements to resell................................ 2,476,963
Loans and lease financing receivables:
Loans and leases, net of unearned
income...............38,028,772
LESS: Allowance for loan and
lease losses............568,617
LESS: Allocated transfer risk
reserve........................16,352
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,443,803
Trading Assets......................................... 1,563,671
Premises and fixed assets (including capitalized
leases)............................................. 683,587
Other real estate owned................................ 10,995
Investments in unconsolidated subsidiaries and
associated companies................................ 184,661
Customers' liability to this bank on acceptances
outstanding......................................... 812,015
Intangible assets...................................... 1,135,572
Other assets........................................... 5,607,019
-----------
Total assets........................................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
LIABILITIES
Deposits:
In domestic offices................................. $26,488,980
Noninterest-bearing.......................10,626,811
Interest-bearing..........................15,862,169
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 20,655,414
Noninterest-bearing..........................156,471
Interest-bearing..........................20,498,943
Federal funds purchased and Securities sold under
agreements to repurchase............................ 3,729,439
Demand notes issued to the U.S.Treasury................ 257,860
Trading liabilities.................................... 1,987,450
Other borrowed money:
With remaining maturity of one year or less......... 496,235
With remaining maturity of more than one year
through three years............................... 465
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 822,455
Subordinated notes and debentures...................... 1,308,000
Other liabilities...................................... 2,846,649
---------
Total liabilities...................................... 58,624,027
----------
----------
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 815,314
Undivided profits and capital reserves................. 4,001,767
Net unrealized holding gains (losses) on
available-for-sale securities....................... (7,956)
Cumulative foreign currency translation adjustments....
(31,510)
-----------
Total equity capital................................... 5,912,899
-----------
Total liabilities and equity capital................... $64,536,926
-----------
-----------
</TABLE>
<PAGE>
I, Thomas J. Mastro, 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.
Thomas J. Mastro
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.
---
Thomas A. Reyni /
Alan R. Griffith / Directors
Gerald L. Hassell /
---
- -------------------- ---------------------- ----------------------
