As filed with the Securities and Exchange Commission on November __, 1998
Registration No. 333 -
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
The Bear Stearns Companies Inc.
Bear Stearns Capital Trust II
Bear Stearns Capital Trust III
Bear Stearns Capital Trust IV
Bear Stearns Capital Trust V
(Exact name of registrant as specified in its charter)
Delaware 13-3286161
Delaware To Be Applied For
Delaware To Be Applied For
Delaware To Be Applied For
Delaware To Be Applied For
(State or other jurisdiction
of incorporation or organization) (I.R.S. Employer Identification No.)
------------------
William J. Montgoris
Chief Operating Officer
c/o The Bear Stearns Companies Inc.
245 Park Avenue 245 Park Avenue
New York, New York 10167 New York, New York 10167
(212) 272-2000 (212) 272-2000
(Address, including zip code, and telephone (Name, address, including zip
number, including area code, of registrant's code, and telephone number,
principal executive offices) including area code, of agent
for service)
Copies to:
Dennis J. Block, Esq. Thomas E. Constance, Esq.
Cadwalader, Wickersham & Taft Kramer Levin Naftalis & Frankel LLP
100 Maiden Lane 919 Third Avenue
New York, New York 10038 New York, New York 10022
(212) 504-6000 (212) 715-9100
------------------
Approximate date of commencement of proposed sale to the public:
At various times after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
|_| 333-_______________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_| 333-_______________
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>
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Proposed
Amount Maximum
Title of Each Class of to be Offering Price
Securities to be Registered(1) Registered Per Unit(2)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Junior Subordinated Deferrable Interest Debentures
of The Bear Stearns Companies Inc.(2)......... $750,000,000 100%
- --------------------------------------------------------------------------------------------------------------------
Preferred Securities of Bear Stearns Capital Trust
II, Bear Stearns Capital Trust III, Bear
Stearns Capital Trust IV and Bear Stearns (3) (3)
Capital Trust V...............................
- --------------------------------------------------------------------------------------------------------------------
The Bear Stearns Companies Inc. Guarantees of the
Preferred $750,000,000 100%
Securities....................................
- --------------------------------------------------------------------------------------------------------------------
Preferred Stock of The Bear Stearns Companies Inc.. 750,000 shares $1,000
- --------------------------------------------------------------------------------------------------------------------
Depositary Shares of The Bear Stearns Companies (6) (6)
Inc. .........................................
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================
Proposed
Maximum
Title of Each Class of Aggregate Amount of
Securities to be Registered(1) Offering Price(2) Registration Fee
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Junior Subordinated Deferrable Interest Debentures
of The Bear Stearns Companies Inc.(2)......... $750,000,000 $208,500
- --------------------------------------------------------------------------------------------------------------------
Preferred Securities of Bear Stearns Capital Trust
II, Bear Stearns Capital Trust III, Bear
Stearns Capital Trust IV and Bear Stearns $750,000,000 (3)
Capital Trust V...............................
- --------------------------------------------------------------------------------------------------------------------
The Bear Stearns Companies Inc. Guarantees of the
Preferred $750,000,000 (4)
Securities....................................
- --------------------------------------------------------------------------------------------------------------------
Preferred Stock of The Bear Stearns Companies Inc.. $750,000,000 (5)
- --------------------------------------------------------------------------------------------------------------------
Depositary Shares of The Bear Stearns Companies (6) (6)
Inc. .........................................
====================================================================================================================
</TABLE>
(1) This Registration Statement is deemed to cover the rights of holders of
Junior Subordinated Deferrable Interest Debentures of The Bear Stearns
Companies Inc. under the Indenture, the rights of holders of Preferred
Securities of Bear Stearns Capital Trust II, Bear Stearns Capital Trust
III, Bear Stearns Capital Trust IV and Bear Stearns Capital Trust V under
each Trust Agreement, the rights of holders of the Preferred Securities
under the Guarantees, and the rights of holders of Preferred Stock of The
Bear Stearns Companies Inc.
(2) Estimated solely for purposes of computing the registration fee.
(3) The Preferred Securities will be offered in such units at such price per
unit to be determined at the time of the offering, but not to exceed an
aggregate offering price of $750,000,000. The Junior Subordinated
Deferrable Interest Debentures will be purchased by Bear Stearns Capital
Trust II, Bear Stearns Capital Trust III, Bear Stearns Capital Trust IV and
Bear Stearns Capital Trust V with the proceeds of the sale of the Preferred
Securities, thus no additional proceeds will be realized from such sale.
(4) Pursuant to Rule 457(n), no additional filing fee is required, as no
separate consideration will be paid for the Guarantees.
(5) The aggregate proceeds from the sale of Junior Subordinated Deferrable
Interest Debentures and of Preferred Stock will in no event exceed
$750,000,000.
(6) No additional consideration will be paid for the Depositary Shares.
------------------
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to 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 registration statement
filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not
soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
The information in this Prospectus will be amended or completed;
dated November 5, 1998
PROSPECTUS
The Bear Stearns Companies Inc.
By this Prospectus, the Company may offer--
Junior Subordinated Deferrable Interest Debentures Preferred Stock
Bear Stearns Capital Trust II
Bear Stearns Capital Trust III
Bear Stearns Capital Trust IV
Bear Stearns Capital Trust V
By this Prospectus, the Trusts may offer--
Preferred Securities
Guaranteed by The Bear Stearns Companies Inc.
- --------------------------------------------------------------------------------
The Company and the Trusts will provide the specific terms of these
securities in supplements to this Prospectus. You should read this
Prospectus and the supplements carefully before you invest.
- --------------------------------------------------------------------------------
Investment in the securities being offered involves certain risks. See
"Risk Factors" beginning on page 4.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this Prospectus. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is , 1998.
<PAGE>
You should only rely on the information incorporated by reference or
provided in this Prospectus or any supplement to this Prospectus. The Company
and the Trusts have not authorized anyone else to provide you with different
information. These securities are not being offered in any state where the offer
is not permitted. You should not assume that the information in this Prospectus
or any supplement to this Prospectus is accurate as of any date other than the
date on the front of those documents.
TABLE OF CONTENTS
Page
----
Where You Can Find More Information........................................2
Certain Definitions........................................................4
Forward Looking Statements.................................................4
Risk Factors...............................................................5
The Company................................................................8
The Trusts.................................................................9
Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends.........................................10
Use of Proceeds...........................................................10
About This Prospectus.....................................................10
Overview of Debentures, Preferred Securities and Guarantees...............11
Description of Debentures.................................................12
Description of Preferred Securities.......................................21
Description of Guarantees.................................................32
Relationship Among Debentures, Preferred Securities and Guarantees........34
Description of Preferred Stock............................................37
Description of Depositary Shares..........................................40
Book-Entry Issuance.......................................................43
ERISA Considerations......................................................46
Plan of Distribution......................................................47
Legal Matters.............................................................48
Experts...................................................................48
The principal executive office of the Company and each Trust is located at
245 Park Avenue, New York, New York 10167; the telephone number of the Company
and each Trust is (212) 272-2000. The Company's Internet address is
http:\\www.bearstearns.com.
WHERE YOU CAN FIND MORE INFORMATION
The Bear Stearns Companies Inc. files annual, quarterly and special
reports, proxy statements and other information required by the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), with the Securities and
Exchange Commission (the "SEC"). You may read and copy any document the Company
files at the SEC's public reference rooms located at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at Seven World Trade Center, 13th Floor, New York, New
York 10048 and at Northwest Atrium Center, 5000 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. The Company's SEC filings are also
available to the public from the SEC's web site at http://www.sec.gov. Copies of
these reports, proxy statements and other information can also be inspected at
the offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005.
The Company and the Trusts have filed with the SEC a registration statement
on Form S-3 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Debentures, Preferred
Securities and Guarantees and the Preferred Stock. This Prospectus, which
constitutes a part of that Registration Statement, does not contain all the
information contained in that Registration Statement and its exhibits. For
further information with respect to the Company and the Trusts and the
Debentures, Preferred
2
<PAGE>
Securities and Guarantees and the Preferred Stock, you should consult the
Registration Statement and its exhibits. Statements contained in this Prospectus
concerning the provisions of any documents are necessarily summaries of those
documents, and each statement is qualified in its entirety by reference to the
copy of the document filed with the SEC. The Registration Statement and any of
its amendments, including exhibits filed as a part of the Registration Statement
or an amendment to the Registration Statement, are available for inspection and
copying through the entities listed above.
The SEC allows the Company and the Trusts to "incorporate by reference" the
information that we file with them, which means that we can disclose important
information to you by referring you to the other information we have filed with
the SEC. The information that we incorporate by reference is considered to be
part of this Prospectus, and information that we file later with the SEC will
automatically update and supersede this information.
The following documents filed by The Bear Stearns Companies Inc. with the
SEC pursuant to Section 13 of the Exchange Act (File No. 1-8989) and any future
filings under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act made before
the termination of the offering are incorporated by reference:
(i) the Annual Report on Form 10-K (including the portions of the Company's
Annual Report to Stockholders and Proxy Statement incorporated by
reference therein) for the fiscal year ended June 30, 1998; and
(ii) the Current Reports on Form 8-K dated July 21, 1998, August 26, 1998
and October 14, 1998.
The Company and the Trusts will provide to you without charge, a copy of
any or all documents incorporated by reference into this Prospectus except the
exhibits to such documents (unless such exhibits are specifically incorporated
by reference in such documents). You may request copies by writing or
telephoning the Company at Corporate Communications Department, The Bear Stearns
Companies Inc., 245 Park Avenue, New York, New York 10167; telephone number
(212) 272-2000.
3
<PAGE>
CERTAIN DEFINITIONS
Unless otherwise stated in this Prospectus:
o the "Company" refers to The Bear Stearns Companies Inc. and its
subsidiaries;
o "Bear Stearns" refers to Bear, Stearns & Co. Inc.;
o "BSSC" refers to Bear, Stearns Securities Corp.;
o "BSIL" refers to Bear, Stearns International Limited; and
o the "Trusts" refer to Bear Stearns Capital Trust II, Bear Stearns
Capital Trust III, Bear Stearns Capital Trust IV and Bear Stearns
Capital Trust V collectively.
Bear Stearns, BSSC and the Trusts are subsidiaries of the Company.
FORWARD-LOOKING STATEMENTS
This Prospectus includes and incorporates by reference "forward-looking
statements" within the meaning of the securities laws. All statements regarding
the Company's and the Trusts' expected financial position, business and
financing plans are forward-looking statements. Forward-looking statements also
include representations of our expectations or beliefs concerning future events
that involve risks and uncertainties, including those associated with the effect
of international, national and regional economic conditions and the performance
of Bear Stearn's and BSSC's products within the prevailing economic environment.
Although we believe that the expectations reflected in such forward-looking
statement are reasonable, such expectations may prove to be incorrect.
Cautionary statements describing important factors that could cause actual
results to differ materially from such expectations are disclosed in this
Prospectus, in conjunction with the forward-looking statements included or
incorporated by reference in this Prospectus. All subsequent written and oral
forward-looking statements attributable to us or persons acting on our behalf
are expressly qualified in their entirety by such cautionary statements.
4
<PAGE>
RISK FACTORS
You should carefully consider the following factors and other information
in this Prospectus and the applicable Prospectus Supplement before deciding to
invest in the securities being offered.
Ranking of Obligations under the Guarantees and the Debentures
The Company's obligations under the Guarantees and the Debentures will be
unsecured and subordinate and junior in right of payment to all Senior Debt of
the Company. At June 30, 1998, the Company had outstanding on an unconsolidated
basis approximately $29.0 billion of debt, including approximately $27.7 billion
of Senior Debt, none of which is secured, and subsidiaries of the Company had
outstanding on an unconsolidated basis approximately $1.2 billion of debt
(excluding $45.3 billion relating to securities sold under repurchase
agreements). The Indenture, the Guarantees and the Trust Agreements do not limit
the amount of additional secured or unsecured debt, including Senior Debt, that
the Company may incur. See "Description of Guarantees" and "Description of
Debentures--Subordination." Because the Company is a holding company, the
Company's right to participate in any distribution of assets of any subsidiary,
when such subsidiary is liquidated or reorganized, is subject to the prior
claims of creditors of the subsidiary. Accordingly, the Debentures will be
effectively subordinated to all existing and future liabilities of the Company's
subsidiaries, and holders of Debentures should look only to the assets of the
Company for payments on the Debentures. See "The Company."
The ability of any Trust to pay amounts on its Preferred Securities is
solely dependent upon the Company making payments on the Debentures as and when
required.
Option to Extend Interest Payment Period; Price Consequences
If the applicable Prospectus Supplement provides, the Company will have the
right under the Indenture to periodically defer payment of interest for an
Extension Period of up to the number of consecutive interest payment periods
specified in the applicable Prospectus Supplement. The interest payment
deferment will be subject to the terms, conditions and any covenants specified
in the applicable Prospectus Supplement. The Extension Period may not extend
beyond the maturity of such series of Debentures, as provided in the applicable
Prospectus Supplement. Certain United States federal income tax consequences and
other applicable considerations to any such Debentures will be described in the
applicable Prospectus Supplement. See "Description of Debentures--Option to
Defer Interest Payments" and "Description of Preferred
Securities--Distributions."
The Indenture will also limit the Company's ability to pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of its capital stock during an Extension Period. In the
event that the Company elects to exercise such right, the market price of the
Preferred Securities is likely to be adversely affected. If you sell Preferred
Securities during an Extension Period, you might not receive the same return on
your investment as holders who continue to hold their Preferred Securities. In
addition, due to the Company's right to defer interest payments, the market
price of the Preferred Securities (which represent preferred undivided
beneficial interests in the assets of a Trust) may be more volatile than the
market prices of other securities that are not subject to such deferrals.
Special Event Redemption
If a Special Event regarding a series of Debentures occurs and is
continuing, the Company may redeem all (but not a part) of such series of
Debentures at any time within 90 days of the date of such Special Event at the
redemption price described in the applicable Prospectus Supplement. Such a
redemption of Debentures would cause a mandatory redemption of the Preferred
Securities. See "Description of Preferred Securities--Redemption or Exchange."
A "Special Event" means an Investment Company Event or a Tax Event.
5
<PAGE>
An "Investment Company Event" means the receipt by a Trust of an opinion of
counsel to the effect that, as a result of a change in the laws (or any
regulations) or in official administrative or judicial interpretation or
application of such laws (or regulations), there is more than an insubstantial
risk that such Trust is or will be required to be registered under the
Investment Company Act on or after the date of the issuance of the Preferred
Securities of such Trust.
A "Tax Event" means the receipt by a Trust of an opinion of counsel to the
effect that, as a result of a change in the laws (or any regulations) or in
official administrative or judicial interpretation or application of such laws
(or regulations), there is more than an insubstantial risk that (i) such Trust
is, or will be within 90 days, subject to United States federal income tax with
respect to income received or accrued on the corresponding series of Debentures,
(ii) all or a part of the interest payable by the Company on such series of
Debentures is not, or within 90 days will not be, deductible by the Company for
United States federal income tax purposes, or (iii) such Trust is, or will be
within 90 days, subject to more than a minimal amount of taxes, duties or
governmental charges.
Exchange of Preferred Securities for Debentures
The Company will be able to dissolve the Trusts at any time and distribute
(after satisfaction of liabilities to creditors as required by applicable law)
Debentures to you as a holder of Preferred Securities in liquidation of such
Trusts. See "Description of Preferred Securities--Liquidation Distribution on
Dissolution."
Because you may receive Debentures on termination of a Trust and because
Distributions are otherwise limited to payments on the Debentures, you are also
making an investment decision relating to the Debentures when you invest in the
Preferred Securities. You should carefully review all the information regarding
the Debentures contained in this Prospectus and the applicable Prospectus
Supplement. See "Description of Debentures" and "Description of Preferred
Securities."
Prices for Preferred Securities or Debentures
The Company and the Trusts cannot make any guarantees about the market
prices for the Preferred Securities or the Debentures that may be exchanged for
Preferred Securities if a Trust were to be dissolved and liquidated. You should
be aware if you invest that the Preferred Securities or the Debentures may trade
at a lower price than you paid to purchase the Preferred Securities.
Rights Under the Guarantee
The Chase Manhattan Bank will act as the Guarantee Trustee and will hold
the Guarantees for your benefit. The Chase Manhattan Bank will also act as
Debenture Trustee for the Debentures and as Property Trustee under the Trust
Agreements and its affiliate Chase Manhattan Bank Delaware will act as Delaware
Trustee under the Trust Agreements. Unless the applicable Prospectus Supplement
states differently, each Guarantee will guarantee to you as a holder of
Preferred Securities the following payments if they are not paid by the
applicable Trust:
o any accumulated and unpaid Distributions that must be paid on such
Preferred Securities, to the extent
such Trust has funds available at such time;
o the Redemption Price, with respect to any Preferred Securities called
for redemption, to the extent such Trust has funds available at such
time; and
o if a voluntary or involuntary dissolution of such Trust occurs, and a
distribution of Debentures to the holders of such Preferred Securities
is not made, an amount equal to the lesser of either (i) the
Liquidation Distribution or (ii) the aggregate of the Liquidation
Amount and all accumulated and unpaid Distributions on the Preferred
Securities to the date of payment, to the extent the Trust has funds
available for that purpose.
The holders of at least a majority of the Liquidation Amount of the
Preferred Securities have the right to direct the time, method and place of a
proceeding for any remedy available to the Guarantee Trustee or to direct the
exercise of any trust or power conferred upon the Guarantee Trustee under the
Guarantees. As a holder of
6
<PAGE>
Preferred Securities, you may institute legal proceedings directly against the
Company to enforce your rights under such Guarantees without first bringing
legal proceedings against the applicable Trust, the Guarantee Trustee, or any
other person or entity. If the Company does not make interest or principal
payments on a series of Debentures purchased by a Trust, that Trust will not be
able to pay any distributions on its Preferred Securities because it will not
have the funds to do so. If such a default occurs, you would not be able to rely
on the Guarantees for payment of these amounts. Instead, if a Debenture Event of
Default relating to the failure to pay interest or principal on a series of
Debentures has occurred and is continuing, you may institute a suit directly
against the Company to enforce payment of the principal or interest on such
Debentures having a principal amount equal to the Liquidation Amount of your
Preferred Securities. Notwithstanding any payments made to you by the Company in
connection with such suit, the Company will remain obligated to pay the
principal of and interest on the Debentures, and the Company will have the right
to set-off any payment made to such holder of Preferred Securities by the
Company in connection with a suit directly against the Company or under the
related Guarantee. You will not be able to directly exercise any other remedies
available to the Trusts as the holders of the Debentures unless there has been
an Event of Default under the applicable Trust Agreement. See "Description of
Debentures--Enforcement of Certain Rights by Holders of Preferred Securities"
and "--Debenture Events of Default" and "Description of Guarantees." Each Trust
Agreement provides that by receiving and accepting Preferred Securities, you
agree to the provisions of the Guarantees and the Indenture.
Limited Voting Rights
As a holder of Preferred Securities, you will generally have limited voting
rights relating only to the modification of the Preferred Securities and the
exercise of the applicable Trust's rights as holder of Debentures. You will have
limited authority to vote to remove or replace the Trustees. The Company (as
holder of the Common Securities), the Property Trustee and the Delaware Trustee
may amend each Trust Agreement without your consent to ensure that each Trust
will be classified for United States federal income tax purposes as a grantor
trust even if doing so adversely affects your interests. See "Description of
Preferred Securities--Voting Rights; Amendment of each Trust Agreement" and
"Description of Preferred Securities--Removal of Trustees."
Absence of Public Market
The Preferred Securities, the Preferred Stock and the Depositary Shares
will be new issues of securities with no established trading market. Any
election by the Company to file an application for listing of the Preferred
Securities, the Preferred Stock or the Depositary Shares on any exchange or
quotation system will be specified in the applicable Prospectus Supplement.
However, the Company does not know the extent to which investor interest in the
Preferred Securities, the Preferred Stock or the Depositary Shares will lead to
the development of a trading market or how liquid that market will be even if
the Preferred Securities, the Preferred Stock or the Depositary Shares are
listed on an exchange or quotation system. If no active public market develops,
the market price and liquidity of the Preferred Securities, the Preferred Stock
or the Depositary Shares may be adversely affected.
7
<PAGE>
THE COMPANY
The Bear Stearns Companies Inc. is a holding company that, through its
principal subsidiaries, Bear Stearns, BSSC and BSIL, is a leading United States
investment banking, securities trading and brokerage firm serving corporations,
governments, institutional and individual investors worldwide. The Company's
business includes:
o market-making and trading in corporate, United States government,
government-agency, mortgage-related, asset-backed and municipal
securities;
o trading in equity and debt corporate securities, options, futures,
foreign currencies, interest-rate swaps and other derivative products;
o securities and commodities arbitrage;
o securities, options and commodities brokerage;
o underwriting and distributing securities;
o providing securities clearance services;
o financing customer activities;
o securities lending;
o arranging for the private placement of securities;
o advising clients in mergers, acquisitions, restructurings and
leveraged transactions;
o providing other financial advisory services;
o making principal investments in leveraged acquisitions;
o acting as specialist on the floor of the New York Stock Exchange;
o providing fiduciary and other services, such as real estate brokerage,
investment management and investment advisory; and
o financial market and securities research.
The Company conducts its business from its principal offices in New York
City; from domestic regional offices in Atlanta, Boston, Chicago, Dallas, Los
Angeles and San Francisco; from representative offices in Beijing, Geneva,
Lugano and Shanghai; through international subsidiaries in Buenos Aires, Dublin,
Hong Kong, London, Paris, Sao Paulo, Singapore and Tokyo; and through joint
ventures with other firms in Belgium, Madrid and the Philippines. The Company's
foreign offices provide services and engage in investment activities involving
foreign clients and international transactions. The Company provides
trust-company services through its subsidiary, Custodial Trust Company, located
in Princeton, New Jersey.
Bear Stearns and BSSC are broker-dealers registered with the SEC. They are
also members of the New York Stock Exchange, all other principal United States
securities and commodities exchanges, the National Association of Securities
Dealers, Inc. and the National Futures Association. Bear Stearns is a "primary
dealer" in United States government securities, as designated by the Federal
Reserve Bank of New York. BSIL is a securities broker dealer based in London.
BSIL is regulated by the Financial Services Authority in the United Kingdom and
is a member of the London International Financial Futures Exchange, the London
Securities & Derivatives Exchange, the International Petroleum Exchange and the
London Commodity Exchange.
8
<PAGE>
THE TRUSTS
Each Trust is a statutory business trust created under Delaware law. As a
Delaware business trust, each Trust will be subject to (i) a trust agreement
executed by the Company, as Depositor, a Delaware Trustee, a Property Trustee
and three Administrators and (ii) a certificate of trust filed with the Delaware
Secretary of State. The trust agreement of each Trust will be amended and
restated in its entirety (as amended and restated, a "Trust Agreement") before
the issuance of any Preferred Securities. Each Trust Agreement will be
substantially in the form filed as an exhibit to the Registration Statement.
Each Trust Agreement will be qualified as an indenture under the Trust Indenture
Act of 1939, as amended (the "TIA"). Each Trust will only have the following
purposes:
o issuing and selling its Common Securities and Preferred Securities
(the "Trust Securities");
o using the proceeds from such sale to acquire a series of Debentures
issued by the Company;
o and engaging in other necessary or incidental activities (for example,
registering the transfer of Trust Securities).
Accordingly, the Debentures will be the only assets of each Trust, and payments
received from the Debentures will be the only revenue of each Trust.
All of the Common Securities of each Trust will be owned by the Company.
The Company will acquire Common Securities with an aggregate Liquidation Amount
of at least 3% of each Trust's total capital.
Each Trust has a term of approximately 55 years unless the applicable
Prospectus Supplement states differently, but may terminate earlier as the Trust
Agreement provides. Each Trust's business and affairs will be conducted by its
trustees, which are appointed by the Company. Each of the Trusts will have the
following Trustees and Administrators:
o Property Trustee: The Chase Manhattan Bank, which will act as sole
trustee under each Trust Agreement for purposes of compliance with the
TIA;
o Delaware Trustee: Chase Manhattan Bank Delaware;
o Administrators: three individual trustees who are employees or
officers of or affiliated with the Company.
The Chase Manhattan Bank will also act as trustee under the Guarantees and the
Indenture governing the Debentures. See "Description of Guarantees" and
"Description of Debentures." The Company (as the holder of the Common
Securities) can appoint, remove or replace the Property Trustee and/or the
Delaware Trustee. Also, if any event of default under a Trust Agreement has
occurred and is continuing, then the holders of a majority of the Liquidation
Amount of the related Preferred Securities will also be able to appoint, remove
or replace the Property Trustee and/or the Delaware Trustee. As a holder of
Preferred Securities, you will not be able to appoint, remove or replace the
Administrators because the Company (as holder of the Common Securities) has that
power exclusively. The duties and obligations of each Trustee are governed by
the applicable Trust Agreement. The Company will pay all ongoing fees and
expenses of each Trust, including those related to the offering of the Preferred
Securities.
9
<PAGE>
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The ratio of earnings to fixed charges and to combined fixed charges and
preferred stock dividends for each of the periods indicated are as follows:
<TABLE>
<CAPTION>
Three Months Ended
---------------------
September 25, September 26, Fiscal Year Ended June 30,
----------------------------------------------------------
1998 1997 1998 1997 1996 1995 1994
------------- ------------ --------- ---------- ---------- ----------- ----------
(Unaudited)
(In thousands, except for ratio)
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings before taxes on $ 93,309 $ 267,138 $ 1,063,492 $ 1,013,690 $ 834,926 $ 388,082 $ 642,799
income....................
Added fixed charges:
Interest................ 982,703 816,915 3,638,513 2,551,364 1,981,171 1,678,515 1,023,866
Interest factor in rents 7,706 7,231 30,130 26,516 25,672 24,594 21,772
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total fixed charges.......... 990,409 824,146 3,668,643 2,577,880 2,006,843 1,703,109 1,045,638
----------- ----------- ----------- ----------- ----------- ----------- -----------
Earnings before fixed
charges and taxes on $ 1,083,718 $ 1,091,284 $ 4,732,135 $ 3,591,570 $ 2,841,769 $ 2,091,191 $ 1,688,437
income.................... =========== =========== =========== =========== =========== =========== ===========
Preferred Stock dividends.... $ 9,778 $ 5,925 $ 31,970 $ 23,890 $ 24,493 $ 25,137 $ 24,667
Ratio of income before
provision for income
taxes to net 146% 165% 161% 165% 170% 161% 166%
income*..................
Preferred dividend
factor on pre-tax basis.... 14,233 9,793 51,481 39,484 41,680 40,543 40,975
----------- ----------- ----------- ----------- ----------- ----------- -----------
Total combined fixed charges
and preferred stock
dividends................. $ 1,004,642 $ 833,939 $ 3,720,124 $ 2,617,364 $ 2,048,523 $ 1,743,652 $ 1,086,613
=========== =========== =========== =========== =========== =========== ===========
Ratio of earnings to
combined fixed charges
and preferred stock 1.1 1.3 1.3 1.4 1.4 1.2 1.6
dividends................ =========== =========== =========== =========== =========== =========== ===========
</TABLE>
* Represents income before provision for income taxes divided by net income;
which adjusts dividends on outstanding series of preferred stock of the
Company to a pre-tax basis.
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the securities
for general corporate purposes, which may include additions to working capital,
the repayment of indebtedness and investment in, or extensions of credit to,
subsidiaries. The applicable Prospectus Supplement will describe any different
use of proceeds.
ABOUT THIS PROSPECTUS
This Prospectus is a part of the Registration Statement we filed with the
SEC utilizing the "shelf" registration process. Under this shelf registration
process, we may sell any combination of the securities described in this
Prospectus in one or more offerings up to a total dollar amount of $750,000,000.
This Prospectus provides you with a general description of the securities we may
offer. Each time we sell securities, we will provide a Prospectus Supplement
that will contain the specific information about the terms of that offering. The
Prospectus Supplement may also add, update or change information contained in
this Prospectus. You should read both this Prospectus and any Prospectus
Supplement, together with the additional information described under the heading
"Where You Can Find More Information." It is important for you to consider all
of this information in making your investment decision. This Prospectus may not
be used to consummate sales of Debentures, Preferred Securities or Preferred
Stock unless accompanied by a Prospectus Supplement about the terms of that
offering.
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OVERVIEW OF DEBENTURES, PREFERRED SECURITIES
AND GUARANTEES
The Bear Stearns Companies Inc. may periodically offer its Junior
Subordinated Deferrable Interest Debentures (the "Debentures") in one or more
series or issuances. The Debentures will be unsecured and junior in right of
payment to the Company's Senior Debt. If provided in an applicable Prospectus
Supplement, the Company may defer payments of interest on any series of
Debentures by extending the interest payment period at various times for an
"Extension Period" of up to the number of consecutive interest payment periods
specified in the applicable Prospectus Supplement (but not beyond the maturity
of such series as provided in the applicable Prospectus Supplement). If payments
of interest are deferred, then the Company generally is not permitted to declare
or pay any dividends, distributions or other payments on, or repay, repurchase,
redeem or otherwise acquire, the Company's capital stock or debt securities that
rank equally with or junior to such series of Debentures. See "Risk
Factors--Ranking of Obligations under the Guarantees and the Debentures,"
"Description of Debentures--Option to Defer Interest Payments," "--Restrictions
on Certain Payments" and "--Subordination."
Each of the Trusts may periodically offer Preferred Securities that
represent preferred undivided beneficial interests in the assets of such Trust.
The Company will be the owner of the Common Securities that represent common
undivided beneficial interests in the assets of such Trust. As a holder of
Preferred Securities you will be entitled to a preference over the Common
Securities of such Trust in certain circumstances with respect to (i) cash
distributions ("Distributions") that accumulate from the date of original
issuance and are payable periodically as specified in the applicable Prospectus
Supplement and (ii) amounts payable on redemption or liquidation.
At the same time a Trust issues and sells Preferred Securities, such Trust
will invest the proceeds of the sale of the Preferred Securities and
contributions received for the Common Securities in Debentures. The Debentures
will have terms that correspond to the terms of that Trust's related Preferred
Securities. See "Description of Preferred Securities--Distributions." The
Debentures will be the only assets of each Trust, and payments received from the
Debentures will be the only revenue of each Trust.
The Company will guarantee the payment of Distributions and payments on
liquidation of a Trust or on redemption of Preferred Securities. See
"Description of Guarantees." The Company's obligations under each Guarantee will
be unsecured and junior in right of payment to all Senior Debt of the Company.
Taken together, the Company's obligations under each series of Debentures, the
Indenture, the related Trust Agreement and the related Guarantee will provide a
full, irrevocable and unconditional guarantee of payments of Distributions and
other amounts due on the related Preferred Securities. See "Relationship Among
Debentures, Preferred Securities and Guarantees--Full and Unconditional
Guarantee."
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<PAGE>
DESCRIPTION OF DEBENTURES
The Company will issue the Debentures under an Indenture between the
Company and The Chase Manhattan Bank, as trustee (the "Debenture Trustee"). This
is a summary and is not complete. This summary does not describe certain
exceptions and qualifications contained in the Indenture or the Debentures. You
should read the Indenture, which is filed as an exhibit to the Registration
Statement. The Indenture is qualified under the Trust Indenture Act of 1939, as
amended.
General
The Debentures may be issued in one or more series of Debentures under the
Indenture with terms corresponding to the terms of a series of related Preferred
Securities. In that event, concurrently with the issuance and sale of each
Trust's Preferred Securities, such Trust will invest the proceeds of such sale
and the consideration paid by the Company for the Common Securities of such
Trust in such series of Debentures. Each series of Debentures will be in the
principal amount equal to the aggregate stated Liquidation Amount of the related
Preferred Securities and the Common Securities of such Trust.
Each series of Debentures will be unsecured and subordinate and junior in
right of payment to all Senior Debt of the Company as provided in the Indenture.
See "--Subordination." Because the Company is a holding company, the Company's
right to participate in any distribution of assets of any subsidiary, including
Bear Stearns, BSSC and BSIL, when such subsidiary is liquidated or reorganized
is subject to the prior claims of creditors of the subsidiary. Accordingly, the
Debentures will be effectively subordinated to all existing and future
liabilities of the Company's subsidiaries and the applicable Trusts, as holders
of Debentures should look only to the assets of the Company for payments on the
Debentures. The Indenture does not limit the incurrence of additional debt by
the Company, which debt could be Senior Debt. At June 30, 1998, the Company had
outstanding on an unconsolidated basis approximately $29.0 billion of debt,
including approximately $27.7 billion of Senior Debt, none of which is secured,
and subsidiaries of the Company had outstanding on an unconsolidated basis
approximately $1.2 billion of debt (excluding $45.3 billion relating to
securities sold under repurchase agreements).
The Debentures may be issued in one or more series pursuant to a
supplemental indenture to the Indenture or a resolution of the Company's Board
of Directors.
The applicable Prospectus Supplement will describe some or all of the
following terms of the Debentures:
o the title;
o any limit on the aggregate principal amount;
o maturity date on which principal is payable or the method of
determining it;
o interest rate(s);
o Interest Payment Dates;
o rights to defer or extend an Interest Payment Date;
o record dates for each corresponding Interest Payment Date;
o the place of payment where (i) principal, premium, and interest are
payable, (ii) Debentures may be presented for registration of transfer
or exchange and (iii) notices and demands to the Company may be made;
o terms and conditions of optional redemption;
o terms and conditions of mandatory redemption;
o issuable denominations;
o currency(ies) in which the principal, any premium and any interest are
payable or the Debentures will be denominated;
o additions, modifications or deletions to the events of default or
covenants of the Company in the Indenture;
o portion (if less than all) of the principal amount payable upon
acceleration or maturity; o additions or changes to the Indenture
necessary to permit or facilitate the issuance of Debentures in bearer
form;
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<PAGE>
o index(ices) and applicable calculations used to determine the amount
of principal, premium or interest payments;
o terms and conditions for issuance of a temporary Global Security
representing all such Debentures and the exchange of a temporary
Global Security for definitive Debentures;
o whether issuance will be in the form of one or more Global Securities
and the depositary for Global Securities;
o appointment of any paying agent(s);
o terms and conditions of any optional or mandatory conversion or
exchange of Debentures into the Company's capital stock or Preferred
Securities;
o form of Trust Agreements and Guarantees; and
o any other terms not inconsistent with the Indenture.
Debentures may be sold at a substantial discount below their stated
principal amount and may bear no interest or below market rate interest. Certain
United States federal income tax consequences and special considerations
applicable to any Debentures will be described in the applicable Prospectus
Supplement.
If (i) the purchase price of any of the Debentures is payable in one or
more foreign currencies or currency units, (ii) any Debentures are denominated
in one or more foreign currencies or currency units or (iii) the principal, any
premium or any interest on any Debentures is payable in one or more foreign
currencies or currency units, then the restrictions, elections, certain United
States federal income tax consequences, specific terms and other information
with respect to such series of Debentures and such foreign currency or currency
units will be set forth in the applicable Prospectus Supplement.
If any index is used to determine the amount of payments of principal, any
premium or any interest on any series of Debentures, special United States
federal income tax, accounting and other applicable considerations will be
described in the applicable Prospectus Supplement.
Denominations, Registration and Transfer
Debentures will be issuable only in registered form without coupons, unless
the applicable Prospectus Supplement states differently. Debentures of any
series will be exchangeable for other Debentures of the same issue and series,
in authorized denominations, with the same aggregate principal amount, original
issue date and maturity and bearing the same interest rate.
Debentures may be presented for exchange, and may be presented for
registration of transfer (with the form of transfer endorsed, or a duly executed
satisfactory written instrument of transfer), at the office of the appropriate
securities registrar or at the office of any transfer agent designated by the
Company for such purpose and referred to in the applicable Prospectus
Supplement. There will be no service charge for any exchange or registration of
transfer, although payment of certain taxes and other governmental charges as
described in the Indenture may be required. The Company will appoint the
Debenture Trustee as securities registrar under the Indenture. If the Company
designates any transfer agents (in addition to the securities registrar) with
respect to any series of Debentures in the applicable Prospectus Supplement, the
Company may rescind that designation or approve a change in the location where
such transfer agent acts at any time, provided that the Company maintains a
transfer agent in each place of payment for such series. The Company may
designate additional transfer agents with respect to any series of Debentures at
any time.
If a redemption occurs, neither the Company nor the Debenture Trustee will
be required to (i) exchange or register the transfer of Debentures of any series
during a period beginning at the opening of business 15 days before the mailing
of a notice of redemption of Debentures of that series and ending at the close
of business on the day of such mailing or (ii) exchange or transfer any
Debentures so selected for redemption, except any portion of Debentures not
being redeemed in a partial redemption.
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<PAGE>
Global Debentures
Unless the applicable Prospectus Supplement states differently, all or a
part of each series of Debentures may be issued in the form of one or more
Global Debentures that will be deposited with, or on behalf of, a depositary
(the "Depositary") identified in the applicable Prospectus Supplement. Global
Debentures will be issued only in fully registered form, but may be in either
temporary or permanent form. Unless and until it is exchanged for certificated
Debentures, a Global Debenture may be transferred only as a whole. Transfers of
Global Debentures are permitted between the following entities:
o by the Depositary for such Global Debenture to a nominee of such
Depositary;
o by a nominee of such Depositary to such Depositary or another nominee
of such Depositary; or
o by the Depositary or any nominee to a successor Depositary or any
nominee of such successor.
While each Prospectus Supplement will describe the terms of the depositary
arrangement with respect to each series of Debentures, the Company expects the
following terms will apply to each of the depositary arrangements.
The Depositary or its nominee will credit on its book-entry registration
and transfer system the respective principal amounts of the individual
Debentures that are represented by the corresponding Global Debenture issued and
deposited with them to the accounts of persons who have accounts
("Participants") with such Depositary. The depositary accounts may include the
accounts of Morgan Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System ("Euroclear"), and Cedel Bank, societe anonyme
("Cedel"). The dealers, underwriters or agents or the Company (if the Company
offers and sells such Debentures directly) will designate these accounts for the
respective Debentures.
The ownership of the beneficial interests in a Global Debenture will be
limited to Participants or persons that may hold interests through Participants,
including Euroclear and Cedel and their participants. Actual ownership of
beneficial interests in each Global Debenture will only be shown on, and the
transfer of ownership will be completed through, records of the applicable
Depositary or its nominee (for interests of Participants), and the records of
Participants (for interests of persons who hold through Participants). However,
because the laws of some states require that certain purchasers of securities
take physical delivery of such securities in definitive form, rather than
through a Global Debenture, such restrictions may impair the ability to transfer
beneficial interests in a Global Debenture.
For all purposes under the Indenture and as long as either the Depositary
or its nominee is the registered owner of the corresponding Global Debenture,
such Depositary or such nominee will be considered the sole holder and owner of
the Debentures represented by such Global Debenture.
Except as provided below, owners of beneficial interests in a Global
Debenture:
o will not be entitled to have any of the individual Debentures of the
series represented by the corresponding Global Debenture registered in
their names;
o will not receive physical delivery of any such Debentures of such
series in definitive form; and
o will not be considered the holders or owners of such Debentures under
the Indenture.
Payments of principal, any premium and any interest on individual
Debentures represented by a Global Debenture registered in the name of a
Depositary or its nominee will be made to the Depositary or its nominee, as the
case may be. None of the Company, the Debenture Trustee, any paying agent or the
securities registrar for such Debentures will be responsible or liable for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in the Global Debenture representing such Debentures. They
also will not be responsible for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
When it receives any payment of principal, any premium or any interest
regarding a permanent Global Debenture representing any Debentures, the Company
expects the Depositary or its nominee to immediately credit
14
<PAGE>
each Participant's account with payments in amounts proportionate to its
respective beneficial interest in the principal amount of such Global Debenture
for such Debentures. Each Participant's beneficial interest will be shown on the
records of such Depositary or its nominee. The Company also expects that
payments by Participants to owners of beneficial interests in each Global
Debenture will be governed by standing instructions and customary practices as
now apply with securities held for customer accounts in bearer form or
registered in "street name." These Participants will be responsible for such
payments.
If a Depositary for a series of Debentures is at any time unwilling, unable
or ineligible to continue as depositary, and the Company does not appoint a
successor depositary within 90 days, the Company will issue individual
Debentures of such series in exchange for the Global Debenture representing such
series of Debentures, unless the applicable Prospectus Supplement states
differently. The Company may at any time and in its sole discretion, subject to
any limitations described in the applicable Prospectus Supplement, determine not
to have any Debentures of such series represented by one or more Global
Debentures. In such case, the Company will issue certificated Debentures of such
series in exchange for the Global Debenture as described in the applicable
Prospectus Supplement.
An owner of a beneficial interest in a Global Debenture may be permitted to
receive individually certificated Debentures of a series in exchange for the
beneficial interests in the Global Debenture on terms that are acceptable to
each of the Company, the Debenture Trustee and the Depositary and subject to any
limitations in the applicable Prospectus Supplement. In such case, the owner of
a beneficial interest in a Global Debenture will be entitled to physical
delivery of certificated Debentures of the same series that is equal in its
aggregate principal amount to the owner's beneficial interest in the
corresponding Global Debenture. The Company will register such Debenture in the
owner's name in the denominations specified for such series in the applicable
Prospectus Supplement.
Payment and Paying Agents
Payment of principal, any premium and any interest on 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(s) as the Company may periodically designate, unless
the applicable Prospectus Supplement states differently. However, at the option
of the Company, payment of any interest may be made (i) except in the case of
Global Debentures, by check mailed to the address in the securities register of
the person entitled to such payment or (ii) by transfer to an account specified
in the securities register maintained by the person entitled to such payment,
provided that proper transfer instructions have been received by the preceding
record date. Unless the applicable Prospectus Supplement states differently,
payment of any interest on Debentures will be made to the person in whose name
such Debentures are registered at the close of business on the record date for
such interest, except in the case of defaulted interest. The Company may at any
time designate additional paying agents or rescind the designation of any paying
agent; however, the Company will at all times be required to maintain a paying
agent in each place of payment for each series of Debentures.
Any moneys deposited with the Debenture Trustee or any paying agent or then
held by the Company in trust for the payment of principal, any premium or any
interest on any Debenture and remaining unclaimed for two years after such
payment has become due and payable shall, at the request of the Company, be
repaid to the Company. After that time, the holder of such Debenture will be a
general unsecured creditor of the Company and may only look to the Company for
payment of such moneys.
Option to Defer Interest Payments
If provided in the applicable Prospectus Supplement, the Company will have
the right to periodically defer payment of interest for an Extension Period of
up to the number of consecutive interest payment periods specified in the
applicable Prospectus Supplement. The interest payment deferment will be subject
to the terms, conditions and any covenants specified in the applicable
Prospectus Supplement. The Extension Period may not extend beyond the maturity
of such series of Debentures as provided in the applicable Prospectus
Supplement. Certain United States federal income tax consequences and other
applicable considerations to any such Debentures will be described in the
applicable Prospectus Supplement.
15
<PAGE>
Redemption
Debentures will not be subject to any sinking fund, unless the applicable
Prospectus Supplement states differently.
The Company may redeem all (at any time) or a part (at particular times) of
the Debentures of any series, unless the applicable Prospectus Supplement states
differently. If the Debentures of any series are redeemable beginning on a
specified date or upon the satisfaction of additional conditions, the applicable
Prospectus Supplement will specify such date or describe such conditions. The
redemption price for any Debenture so redeemed will equal any accrued and unpaid
interest to the redemption date, plus 100% of the outstanding principal amount,
unless the applicable Prospectus Supplement states differently.
Unless the applicable Prospectus Supplement states differently, if a
Special Event regarding a Trust occurs and is continuing, the Company has the
option to redeem all (but not a part) of the corresponding series of Debentures
at any time within 90 days of the date of such Special Event, subject to the
provisions of the Indenture and whether or not such Debentures are then
otherwise redeemable at the option of the Company. The redemption price for any
Debentures will be described in the applicable Prospectus Supplement. For so
long as the applicable Trust is the holder of all the outstanding Debentures of
such series, the proceeds of any such redemption will be used by such Trust to
redeem the corresponding Trust Securities in accordance with their terms.
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 Debentures to be redeemed
at its registered address. Unless the Company defaults in payment of the
redemption price and any interest accrued to the redemption date, interest will
stop accruing on such Debentures (or the part called for redemption) as of the
redemption date.
Restrictions on Certain Payments
The Company will covenant that it will not, and will not permit any of its
subsidiaries to:
o 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,
o make any payment of principal, any premium or any interest on or
repay, repurchase or redeem any debt securities of the Company
(including other series of Debentures) that rank equally with or
junior in interest to the Debentures or
o make any guarantee payments on any guarantee by the Company of the
debt securities of any subsidiary if such guarantee ranks equally with
or junior in interest to the Debentures whenever any of the following
payment restriction events occur:
- the Company has actual knowledge of the occurrence of any event
(i) that with the giving of notice or the lapse of time or both
would constitute a Debenture Event of Default under the Indenture
with respect to the Debentures of such series and (ii) that the
Company has not taken reasonable steps to cure,
- if such Debentures are held by a Trust of a series of related
Preferred Securities and the Company has defaulted on the payment
of any obligations under the Guarantee relating to such related
Preferred Securities or
- the Company has given notice of its election of an Extension
Period as provided in the Indenture with respect to the
Debentures of such series and has not rescinded such notice, or
such Extension Period, or any extension thereof, is continuing.
16
<PAGE>
The Company will be permitted to make:
o dividends or distributions in common stock of the Company,
o 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 to such plan,
o payments under (i) any Guarantee with respect to the series of related
Preferred Securities and (ii) any guarantee for the benefit of holders
of the capital securities of Bear Stearns Capital Trust I,
o purchases of common stock related to the issuance of common stock
under any of the Company's benefit plans for its directors, officers
or employees and
o payments of interest under a loan agreement with Bear Stearns Finance
LLC.
However, the Company will not be able to make payments under any Guarantee if a
payment restriction event occurs with respect to the debentures issued to Bear
Stearns Capital Trust I under the Indenture, dated as of January 29, 1997,
between the Company and The Chase Manhattan Bank, as periodically supplemented.
Modification of Indenture
The Company and the Debenture Trustee may modify the Indenture without the
consent of the applicable Trusts as holders of any series of Debentures to cure
ambiguities, defects or inconsistencies (so long as the interests of such Trusts
or, in the case of Debentures, the holders of the related Preferred Securities
are not materially adversely affected) and qualify, or maintain the
qualification of, the Indenture under the TIA, among other things. The Indenture
permits the Company and the Debenture Trustee to modify the Indenture in a
manner that materially adversely affects the rights of the applicable Trusts as
holders of a series of Debentures so long as the holders of at least a majority
in principal amount of such series of Debentures consents.
The consent of all affected holders of a series of Debentures is required
to, among other things: (i) change the maturity of such series of Debentures;
(ii) reduce the principal amount of, or reduce the rate or extend the time of
payment of interest on, such series of Debentures; or (iii) modify the
provisions regarding subordination of the Debentures in a manner that adversely
affects the rights of holders of such series of Debentures. The consent of all
holders of a series of Debentures is required to reduce the percentage of
principal amount of Debentures of such series, the holders of which are required
to consent to any such modification of the Indenture.
In the case of Debentures, so long as any related Preferred Securities
remain outstanding, unless the principal and any premium of the Debentures and
all accrued and unpaid interest on such Debentures have been paid in full: (i)
no modification may be made that materially adversely affects you as a holder of
such 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 with respect to such Debentures may be effective, without the
prior consent of the holders of at least a majority of the Liquidation Amount of
all outstanding related Preferred Securities affected; and (ii) no modification
may impair your rights as a holder of Preferred Securities to institute suit
directly against the Company when certain Debenture Events of Default occur,
without the prior consent of the holders of all related Preferred Securities
then outstanding.
The Company and the Debenture Trustee may execute any supplemental
indenture to create any new series of Debentures without the consent of any
Trust as a holder of Debentures.
Debenture Events of Default
A "Debenture Event of Default" will occur under the Indenture if any of the
following events occurs:
o failure for 30 days by the Company to pay any interest when due
(subject to the deferral of any due date in the case of an Extension
Period); or
o failure by the Company to pay any principal when due at maturity, upon
redemption, by declaration or otherwise; or
17
<PAGE>
o failure by the Company to observe or perform in any material respect
certain covenants contained in the Debentures or the Indenture for 90
days after written notice to the Company from the Debenture Trustee or
the holders of at least 25% in principal amount of such series of
Debentures; or
o certain events of bankruptcy, insolvency or reorganization of the
Company.
The holders of a majority of the outstanding principal amount of Debentures
of each series affected have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee. The
Debenture Trustee or the holders of at least 25% of the outstanding principal
amount of Debentures of each series affected may declare the principal due and
payable immediately when a Debenture Event of Default occurs. If the Debenture
Trustee or holders of at least 25% of the outstanding principal amount of
Debentures fail to make such declaration, the holders of at least 25% of the
Liquidation Amount of the related Preferred Securities will have such right. If
the Debenture Event of Default has been cured, the holders of a majority of the
outstanding principal amount of Debentures of each series affected may annul
such declaration. If the holders of such Debentures fail to annul such
declaration and waive such default, the holders of a majority of the Liquidation
Amount of the related Preferred Securities affected will have such right.
The holders of a majority of the outstanding principal amount of each
series of the Debentures affected, and the holders of a majority of the
Liquidation Amount of the corresponding Preferred Securities, may, on behalf of
the holders of all the Debentures of such series or the corresponding Preferred
Securities (as applicable), waive any default, except a default in the payment
of principal or interest or a default regarding a covenant or provision which
under the Indenture cannot be modified or amended without the consent of the
holder of each outstanding Debenture. The Company is required to file an annual
certificate with the Debenture Trustee stating whether the Company is in
compliance with all the applicable conditions and covenants under the Indenture.
If a Debenture Event of Default occurs and is continuing as to a series of
Debentures, then the Property Trustee may declare the principal and any interest
on such Debentures to be immediately due and payable and to enforce its other
rights as a creditor with respect to such Debentures.
Enforcement of Certain Rights by Holders of Preferred Securities
If a Debenture Event of Default relating to the failure to pay interest or
principal on a series of Debentures has occurred and is continuing, as a holder
of related Preferred Securities, you may institute a suit directly against the
Company to enforce payment of the principal or interest on such Debentures
having a principal amount equal to the Liquidation Amount of your related
Preferred Securities. The Company may not amend the Indenture to remove your
right to bring such suit without the prior written consent of the holders of all
of the outstanding Preferred Securities. If the right to bring such suit is
removed, the applicable Trust may become subject to the reporting obligations of
the Exchange Act. The Company will have the right under the Indenture to set-off
any payment made to you as a holder of Preferred Securities in connection with a
suit directly against the Company or under the related Guarantee.
You will not be able to directly exercise any remedies other than those
described in the preceding paragraph available to the applicable Trust as
holders of the Debentures unless there has been an Event of Default under the
Trust Agreement. See "Description of Preferred Securities--Events of Default;
Notice."
Consolidation, Merger, Sale of Assets and Other Transactions
The Indenture permits the Company to consolidate or merge with another
person or to sell or convey all or substantially all its assets to any person
if:
o either (i) the Company is the successor person or (ii) the successor
person is organized under the laws of the United States or any state
or the District of Columbia, and such successor person expressly
assumes the Company's obligations on the Debentures and under the
Indenture;
o immediately after the consolidation, merger, sale or conveyance, no
default in the performance of any covenant or condition under the
Indenture has occurred; and
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o in the case of Debentures, such consolidation, merger, sale or
conveyance is permitted and does not cause a breach or violation under
the related Trust Agreement and Guarantee.
The general provisions of the Indenture do not afford the applicable Trusts
as holders of the Debentures protection in the event of a transaction involving
the Company that may adversely affect holders of the Debentures.
Satisfaction and Discharge
The Indenture will cease to be of further effect when:
o all outstanding Debentures of a series are delivered to the Debenture
Trustee for cancellation or
o all outstanding Debentures are due and payable or will become due and
payable or
o all outstanding Debentures will be called for redemption within one
year, and the Company deposits with the Debenture Trustee funds in
trust in an amount sufficient to pay at maturity or upon redemption
all of such outstanding Debentures, including principal and any
interest to the date of maturity or redemption (as applicable) and the
Company has paid all other amounts payable under the Indenture.
The following rights will survive such satisfaction and discharge:
o remaining rights of registration of transfer, conversion, substitution
and exchange and the Company's optional redemption right,
o rights of holders to receive principal and interest and other amounts
deposited with the Debenture Trustee and
o the rights, obligations and immunities of the Debenture Trustee under
the Indenture.
Conversion or Exchange
If and to the extent indicated in the applicable Prospectus Supplement the
Debentures of any series may be convertible into capital stock of the Company.
The specific terms of such conversion will be described in the applicable
Prospectus Supplement. Such conversion may be either mandatory or optional. The
conversion price will be stated in the applicable Prospectus Supplement.
Subordination
In the Indenture, the Company has covenanted and agreed that any Debentures
will be subordinate and junior in right of payment to all Senior Debt as
provided in the Indenture. When any payment or distribution of assets of the
Company is made due to any insolvency event of the Company, the holders of
Senior Debt will first be entitled to receive payment in full of principal, any
premium and any interest on such Senior Debt before any payment of principal or
interest on the Debentures.
If the maturity of any Debentures is accelerated, the holders of all
outstanding Senior Debt will first be entitled to receive payment in full of all
amounts due on such Senior Debt before the holders of Debentures will be
entitled to receive or retain any payment regarding principal or interest on the
Debentures.
No payments on account of principal, any premium or any interest on the
Debentures may be made if a default in any payment with respect to Senior Debt
has occurred and is continuing or an event of default with respect to any Senior
Debt resulting in its acceleration, or if any judicial proceeding is pending
with respect to any such default.
"Debt" 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:
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o every obligation of such person for money borrowed;
o 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;
o every reimbursement obligation of such person with respect to letters
of credit, bankers' acceptances or similar facilities issued for the
account of such person;
o 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);
o every capital lease obligation of such person;
o every obligation of such person for claims regarding derivative
products such as interest and foreign exchange rate contracts,
commodity contracts and similar arrangements; and
o 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 for, directly or indirectly, as obligor or otherwise.
"Senior Debt" means the principal of, any premium and any interest
(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 Debt,
whether incurred on or before the date of the Indenture or thereafter incurred,
unless, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is provided that such obligations are not superior
in right of payment to the Debentures or to other Debt which ranks equally with,
or subordinated to, the Debentures.
Senior Debt will not include:
o any Debt of the Company which, when incurred and without respect to
any election under Section 1111(b) of the United States Bankruptcy
Code of 1978, as amended, was without recourse to the Company,
o any Debt of the Company to any of its subsidiaries,
o Debt to any employee of the Company,
o Debt which by its terms is subordinated to trade accounts payable or
accrued liabilities arising in the ordinary course of business to the
extent that payments made to the Debt holders by the Debenture holders
as a result of the subordination provisions of the Indenture would be
greater than such payments otherwise would have been as a result of
any obligation of such Debt holders to pay amounts to the obligees on
such trade accounts payable or accrued liabilities arising in the
ordinary course of business as a result of subordination provisions to
which such Debt is subject, and
o any other debt securities issued pursuant to the Indenture and the
Indenture, dated as of January 29, 1997, between the Company and The
Chase Manhattan Bank, as periodically supplemented.
Except as described in the next sentence, the Debentures will rank equally
with, and will not be superior in right of payment to, the obligations of the
Company under the Loan Agreement, dated as of March 24, 1994, between the
Company and Bear Stearns Finance LLC in the aggregate principal amount of
$189,875,000. However, the Company will be permitted to make payments of
interest on this loan during an Extension Period.
The Indenture places no limitation on the amount of Senior Debt that the
Company may incur. The Company expects to periodically incur additional
indebtedness and other obligations constituting Senior Debt.
The Indenture provides that the foregoing subordination provisions may be
changed before issuance with respect to the Debentures to be issued. Any such
change would be described in the applicable Prospectus Supplement.
Rights of Holders of Preferred Securities
As a holder of the related Preferred Securities for a series of Debentures,
you will have the rights, in connection with modifications to the Indenture or
when Debenture Events of Default occur, as described under "--Modification of
Indenture", "--Debenture Events of Default" and "--Enforcement of Certain Rights
by Holders of Preferred Securities," unless the applicable Prospectus Supplement
states differently.
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The Company will covenant, as to each series of Debentures:
o to maintain directly or indirectly 100% ownership of the Common
Securities of the Trust to which such Debentures have been issued,
provided that certain successors which are permitted pursuant to the
Indenture may succeed to the Company's ownership of the Common
Securities,
o not to voluntarily terminate, wind up or liquidate any Trust, except
(a) in connection with a distribution of Debentures to you as a holder
of the Preferred Securities in exchange for such Preferred Securities
on liquidation of such Trust, or (b) in connection with certain
mergers, consolidations or amalgamations permitted by the related
Trust Agreement, and
o to use its reasonable efforts, consistent with the terms and
provisions of the related Trust Agreement, to cause such Trust to
remain classified as a grantor trust and not as an association taxable
as a corporation for United States federal income tax purposes.
Trust Expenses
Pursuant to the Indenture, the Company has agreed to pay all debts and
other obligations (other than with respect to the Preferred Securities) and all
costs and expenses of each Trust (including costs and expenses relating to the
organization of each Trust, the fees and expenses of the Trustees and the costs
and expenses relating to the operation of each Trust) and the offering of the
Preferred Securities and to pay any and all taxes and all related costs and
expenses (other than United States federal withholding taxes) to which each
Trust might become subject.
Governing Law
The Indenture is and the 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 will have all the duties and responsibilities
specified with respect to an indenture trustee under the TIA. Subject to the
provisions of the TIA, the Debenture Trustee is not under any obligation to
exercise any of the powers vested in it by the Indenture at the request of any
holder of Debentures, unless it is offered reasonable indemnity by such holder
against the costs, expenses and liabilities which might be incurred. 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.
DESCRIPTION OF PREFERRED SECURITIES
The Preferred Securities will represent preferred undivided beneficial
interests in the assets of a Trust, and as a holder of Preferred Securities, you
will be entitled to a preference in certain circumstances with respect to
Distributions and amounts payable on redemption or liquidation over the Common
Securities of such Trust, as well as other benefits as described in the
corresponding Trust Agreement. This is a summary and is not complete. This
summary does not describe certain exceptions and qualifications contained in the
Trust Agreements or the Preferred Securities. You should read the Trust
Agreements, a form of which is filed as an exhibit to the Registration
Statement. Each of the Trusts is a legally separate entity, and the assets of
one Trust are not available to satisfy the obligations of another Trust or other
statutory business trust whose Common Securities are owned by the Company.
General
The Preferred Securities of a Trust will rank equally, and payments will be
made on the Preferred Securities proportionately (based on Liquidation Amounts)
with the Common Securities of that Trust except as described under
"--Subordination of Common Securities." Legal title to the Debentures will be
held by the Property Trustee in trust for the benefit of the holders of the
related Preferred Securities and Common Securities. Each Guarantee
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executed by the Company for the benefit of the holders of a Trust's Trust
Securities will be a subordinated Guarantee of the related Trust Securities. A
Guarantee will not guarantee the payment of Distributions or amounts payable on
redemption or liquidation of such Trust Securities unless the related Trust has
the funds to make such payments. See "Description of Guarantees."
Distributions
Distributions on the Preferred Securities will:
o be cumulative;
o accumulate from the date of original issuance; and
o be payable on the dates specified in the applicable Prospectus
Supplement.
If the date on which Distributions are payable on the Preferred Securities is
not a Business Day, payment of such Distributions will be made on the next
Business Day (without any interest or other payment for such delay), except
that, if such Business Day is in the next calendar year, payment of such
Distribution will be made on the Business Day before (each date on which
Distributions are payable, a "Distribution Date"). A "Business Day" means any
day other than a Saturday, Sunday or legal holiday, or a day on which banking
institutions in The City of New York are authorized or required by law or
regulation to remain closed or a day on which the corporate trust office of the
Property Trustee or the Debenture Trustee is closed for business.
Each Trust's Preferred Securities represent preferred undivided beneficial
interests in the assets of the applicable Trust, and the Distributions on each
Preferred Security will be payable at the rate specified in the applicable
Prospectus Supplement. The amount of Distributions payable for any period will
be computed on the basis of a 360-day year of twelve 30-day months unless
otherwise specified in the applicable Prospectus Supplement. Distributions will
accumulate additional Distributions at the rate per annum if and as specified in
the applicable Prospectus Supplement. The term "Distributions" includes any such
additional Distributions unless otherwise stated.
If provided in the applicable Prospectus Supplement, the Company has the
right under the Indenture, pursuant to which it will issue the Debentures, to
defer the payment of interest periodically on any series of Debentures for an
Extension Period of up to the number of consecutive interest payment periods
specified in the applicable Prospectus Supplement, so long as no Debenture Event
of Default has occurred and is continuing. The Extension Period may not extend
beyond the maturity of the Debentures. Because of such deferral, Distributions
on the related Preferred Securities would be deferred (but would continue to
accumulate additional Distributions at the rate per annum set forth in the
applicable Prospectus Supplement) by the applicable Trust during any such
Extension Period.
During such Extension Period, the Company will not, and will not permit any
of its subsidiaries to:
o 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,
o make any payment of principal, any premium or any interest on, or
repay, repurchase or redeem any debt securities of, the Company that
rank equally with or junior in interest to the Debentures or
o make any guarantee payments on any guarantee by the Company of debt
securities of any subsidiary if such guarantee ranks equally with or
junior in interest to the Debentures.
The Company may make:
o dividends or distributions in capital stock of the Company,
o any declaration of a dividend in connection with the implementation of
a stockholders' rights plan, the issuance of any capital stock of the
Company under such plan, or the redemption or repurchase of any such
rights pursuant to such plan,
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o payments under (i) any Guarantee with respect to such Preferred
Securities, and (ii) any guarantee for the benefit of holders of the
capital securities of Bear Stearns Capital Trust I.
o 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 and
o payments of interest under a loan agreement with Bear Stearns Finance
LLC.
The revenue of each Trust available for distribution to holders of its
Preferred Securities will be limited to payments under the Debentures in which
each Trust will invest the proceeds from the issuance and sale of its Trust
Securities. See "Description of Debentures--Corresponding Debentures." If the
Company does not make interest payments on such Debentures, the Property Trustee
will not have funds available to pay Distributions on the related Preferred
Securities. The Company will guarantee the payment of Distributions (provided
that a Trust has legally available funds for the payment of such Distributions
and sufficient cash to make such payments) on the basis described under
"Description of Guarantees."
Distributions on the Preferred Securities will be payable to its holders as
they appear on the securities register of such Trust on the relevant record
dates, which will be approximately two weeks before the relevant Distribution
Date. Subject to any applicable laws and regulations and the provisions of the
applicable Trust Agreement, each such payment will be made as described under
"Book-Entry Issuance."
Redemption or Exchange
Mandatory Redemption
When all or a part of the Debentures is repaid or redeemed, the proceeds
from the repayment or redemption will be applied by the Property Trustee to
redeem a Like Amount of the Trust Securities, with at least 30 days but not more
than 60 days notice, at a redemption price (the "Redemption Price") equal to the
Liquidation Amount of such Trust Securities plus accumulated but unpaid
Distributions to the date of redemption (the "Redemption Date") and the related
amount of any premium paid by the Company on the concurrent redemption of such
Debentures. See "Description of Debentures--Redemption." If only a part of any
series of Debentures are to be repaid or redeemed on a Redemption Date, then the
proceeds from such repayment or redemption will be allocated to the redemption
proportionately (based on Liquidation Amounts) among the Trust Securities. The
amount of any premium paid by the Company on the redemption of all or any part
of any series of any Debentures to be repaid or redeemed on a Redemption Date
will be allocated to the redemption proportionately (based on Liquidation
Amounts) among the Trust Securities.
The Company may redeem any series of Debentures (i) beginning on a date
specified in the applicable Prospectus Supplement (all at any time or a part
periodically), or (ii) when a Special Event occurs (all at any time but not a
part).
Distribution of Debentures
The Company may dissolve any Trust at any time and (after satisfaction of
liabilities to creditors as provided by applicable law) cause the Debentures to
be distributed to the holders of the related Preferred Securities and Common
Securities in exchange for such Trust Securities on the liquidation of such
Trust.
After the liquidation date fixed for any distribution of Debentures for any
series of Preferred Securities (i) such series of Preferred Securities will no
longer be deemed outstanding, (ii) certificates representing a Like Amount of
Debentures will be issued to you as a holder of such series of Preferred
Securities, (iii) the Company will use reasonable efforts to have the Debentures
designated on or with any interdealer quotation system or self-regulatory
organization as the related Preferred Securities are then listed, (iv) any
Preferred Securities certificates that are not surrendered will be deemed to
represent a Like Amount of Debentures and (v) your rights will end (except the
right to receive Debentures).
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The Company and the Trusts cannot make any guarantees about the market
prices for the Preferred Securities or the Debentures that may be distributed in
exchange for Preferred Securities if a Trust were to be dissolved and
liquidated. Accordingly, the Preferred Securities that you may purchase, or the
Debentures that you may receive on dissolution and liquidation of a Trust, may
trade at a lower price than you paid to purchase the Preferred Securities.
Special Event Redemption
If a Special Event regarding a series of Preferred Securities and Common
Securities occurs and is continuing, the Company may redeem all (but not a part)
of the Debentures and thus cause a mandatory redemption of all (but not a part)
of such Preferred Securities and Common Securities at the Redemption Price
within 90 days following the occurrence of such Special Event. If a Special
Event regarding a series of Preferred Securities and Common Securities has
occurred and is continuing and the Company does not elect to redeem the
Debentures and thus cause a mandatory redemption of such Preferred Securities
and Common Securities or to terminate the related Trust and cause the Debentures
to be distributed to holders of such Preferred Securities and Common Securities
in exchange for such Trust Securities on liquidation of the Trust as described
above, such Preferred Securities will remain outstanding.
"Like Amount" means (i) with respect to a redemption of any series of Trust
Securities, Trust Securities of such series having a Liquidation Amount equal to
the principal amount of Debentures to be contemporaneously redeemed in
accordance with the Indenture, the proceeds of which will be used to pay the
Redemption Price of such Trust Securities, and (ii) with respect to a
distribution of Debentures to holders of any series of Trust Securities in
connection with a dissolution or liquidation of the related Trust, Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the holder to whom such Debentures would be distributed.
"Liquidation Amount" means the stated amount per Trust Security as set
forth in the applicable Prospectus Supplement.
Redemption Procedures
Preferred Securities redeemed on each Redemption Date will be redeemed at
the Redemption Price using the proceeds from the simultaneous redemption of
Debentures. Redemptions of the Preferred Securities will be made and the
Redemption Price will be payable on each Redemption Date only if the related
Trust has funds available for the payment of such Redemption Price. See
"--Subordination of Common Securities."
If the Property Trustee gives a notice of redemption regarding any
Preferred Securities, then, by 10:00 a.m., New York City time, on the Redemption
Date, the Company will deposit funds with the Property Trustee sufficient to pay
the Redemption Price. If the Company has made this deposit, then, by 12:00 noon,
New York City time on the Redemption Date, to the extent funds are available,
the Property Trustee will irrevocably deposit with the Depositary funds
sufficient to pay the applicable Redemption Price and will give the Depositary
irrevocable instructions and authority to pay the Redemption Price to you as a
holder of such Preferred Securities. See "Book-Entry Issuance." If such
Preferred Securities are no longer in book-entry form, the Property Trustee, to
the extent funds are available, will irrevocably deposit with the paying agent
for such Preferred Securities funds sufficient to pay the applicable Redemption
Price and will give such paying agent irrevocable instructions and authority to
pay the Redemption Price to you when you surrender your certificates evidencing
such Preferred Securities. However, Distributions payable on or before the
Redemption Date for any Preferred Securities called for redemption will be
payable to you on the relevant record dates for the related Distribution Dates.
If notice of redemption was given and funds deposited as required, then on the
date of such deposit, all your rights as a holder of such redeemed Preferred
Securities will end, except your right to receive the Redemption Price and any
unpaid Distribution, but without interest, and such Preferred Securities will no
longer be outstanding. If any redemption date is not a Business Day, then
payment of the Redemption Price will be made on the next Business Day (without
any interest or other payment for such delay), except that, if such Business Day
is in the next calendar year, payment of such Redemption Price will be made on
the Business Day before. If payment of the Redemption Price
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is improperly withheld or refused and not paid either by the applicable Trust or
by the Company (under the relevant Guarantee as described under "Description of
Guarantees"), Distributions on such Preferred Securities will continue to accrue
(at the then applicable rate) from the original Redemption Date to the date such
Redemption Price is actually paid. In this case, the actual payment date will be
the redemption date for purposes of calculating the Redemption Price.
Subject to applicable law (including United States federal securities law),
the Company or its subsidiaries may periodically purchase outstanding Preferred
Securities by tender in the open market or by private agreement.
Payment of the Redemption Price on the Preferred Securities will be made to
the applicable holders as they appear on the securities register for such
Preferred Securities on the record date established by the Administrators that
will be at least 30 days but no more than 60 days before the relevant Redemption
Date.
If only a part of the outstanding Preferred Securities and Common
Securities issued by a Trust are to be redeemed on a Redemption Date, then the
Liquidation Amount of such Preferred Securities and Common Securities to be
redeemed will be allocated proportionately (based on Liquidation Amounts) among
the Preferred Securities and the Common Securities. The particular Preferred
Securities to be redeemed will be selected on a proportionate basis (based on
Liquidation Amounts) at least 30 days but no more than 60 days before the
Redemption Date by the Property Trustee from the outstanding Preferred
Securities by such method as the Property Trustee deems fair and appropriate and
which may provide for the selection for redemption of portions of the
Liquidation Amount of Preferred Securities in such minimum amounts as specified
in the applicable Prospectus Supplement. The Property Trustee will promptly
notify the securities registrar, in writing, of the Preferred Securities
selected for redemption and, in the case of any Preferred Securities selected
for partial redemption, the Liquidation Amount to be redeemed. For all purposes
of each Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Preferred Securities will relate to the portion of
the Liquidation Amount of Preferred Securities that has been or is to be
redeemed.
Notice of any redemption will be mailed by the Property Trustee at least 30
days but not more than 60 days before the Redemption Date to each holder of
Trust Securities to be redeemed at its registered address.
Subordination of Common Securities
Payment of Distributions on, and the Redemption Price of, each Trust's
Preferred Securities and Common Securities will be made proportionately (based
on Liquidation Amounts) of such Preferred Securities and Common Securities.
However, if any Event of Default under the applicable Trust Agreement resulting
from a Debenture Event of Default has occurred and is continuing on any
Distribution Date or Redemption Date, (a) the Trust will not pay any
Distribution or Redemption Price regarding its Common Securities or make any
other payment for redemption, liquidation or other acquisition of such Common
Securities unless the Trust has (i) made full cash payment of all accumulated
and unpaid Distributions on all outstanding Preferred Securities for all
Distribution periods ending on or before such Distribution Date, or (ii) in the
case of payment of the Redemption Price, made or provided for the full amount of
such Redemption Price on all of the outstanding Preferred Securities then called
for redemption, and (b) all funds available to the Property Trustee will be
applied first to the full cash payment of all due and payable Distributions or
Redemption Price regarding Preferred Securities.
If any Event of Default under the applicable Trust Agreement resulting from
a Debenture Event of Default occurs, the Company (as holder of such Trust's
Common Securities) will waive any right to act with respect to any such Event of
Default until the effect of all such Events of Default with respect to such
Preferred Securities has been eliminated. Until all Events of Default under the
applicable Trust Agreement with respect to the Preferred Securities have been so
eliminated, the Property Trustee will act only on behalf of the holders of such
Preferred Securities and not on behalf of the Company (as holder of the Trust's
Common Securities), and only the holders of such Preferred Securities will have
the right to direct the Property Trustee to act on their behalf.
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Liquidation Distribution On Dissolution
Under each Trust Agreement, each Trust will automatically dissolve when its
term expires and will dissolve if any of the following occurs: o certain events
of bankruptcy, dissolution or liquidation of the Company (as holder of the
Common Securities);
o written direction to the Property Trustee by the Company to dissolve
such Trust and distribute (after satisfaction of liabilities to
creditors as provided by applicable law) Debentures to holders of
Trust Securities;
o redemption of all of the Trust's Preferred Securities as described
under "--Redemption or Exchange--Mandatory Redemption"; or
o the entry of an order for the dissolution of the Trust by a competent
court.
If an early dissolution occurs because of the first, second or fourth
points above or a Trust's term expires, such Trust will be liquidated by the
Trustees as quickly as the Trustees determine to be possible by distributing
(after satisfaction of liabilities to creditors as provided by applicable law)
to the holders of such Trust Securities a Like Amount of the Debentures. If such
distribution is determined by the Property Trustee not to be practical, such
holders will be entitled to receive out of the assets of such Trust available
for distribution to holders (after satisfaction of liabilities to creditors as
provided by applicable law) an amount equal to the Liquidation Amount plus
accrued and unpaid Distributions on the Preferred Securities to the date of
payment (such amount being the "Liquidation Distribution"). If only a part of
such Liquidation Distribution can be paid because such Trust has insufficient
assets available to pay the full Liquidation Distribution, then the amounts
payable by such Trust on its Trust Securities will be paid on a proportionate
basis (based on Liquidation Amounts). The Company (as holder of the Common
Securities) will be entitled to receive Liquidation Distributions on any such
liquidation proportionately with you as a holder of Preferred Securities, except
that if a Debenture Event of Default has occurred and is continuing, the
Preferred Securities will have a priority over the Common Securities.
Events of Default; Notice
An "Event of Default" will occur under each Trust Agreement if any of the
following events occurs:
o a Debenture Event of Default under the Indenture (see "Description of
Debentures--Debenture Events of Default"); or
o failure for 30 days by the Trust to pay any Distribution when due; or
o failure by the Trust to pay any Redemption Price of any Trust Security
when due; or
o failure by the Trustees to observe or perform in any material respect
any other covenants or warranties in such Trust Agreement for 90 days
after written notice to the defaulting Trustee(s) by the holders of at
least 25% of the Liquidation Amount of the outstanding Preferred
Securities of the applicable Trust; or
o certain events of bankruptcy or insolvency of the Property Trustee and
the failure by the Company to appoint a successor Property Trustee
within 60 days.
Within five Business Days after the Property Trustee obtains actual
knowledge of any Event of Default occurring, the Property Trustee will send
notice of such Event of Default to the holders of such Trust's Trust Securities,
the Administrators and the Company, unless such Event of Default has been cured
or waived. The Company and the Administrators are required to file an annual
certificate with the Property Trustee stating whether they are in compliance
with all the applicable conditions and covenants under each Trust Agreement.
If a Debenture Event of Default has occurred and is continuing the
Preferred Securities will have a preference over the Common Securities as
described above. See "--Subordination of Common Securities" and "--Liquidation
Distribution On Dissolution." An Event of Default does not entitle the holders
of Preferred Securities to accelerate its maturity.
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Removal of Trustees
Unless a Debenture Event of Default has occurred and is continuing, any
Trustee may be removed at any time by the Company (as 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 of the Liquidation Amount of the outstanding Preferred Securities. As a
holder of the Preferred Securities, you do not have the right to vote to
appoint, remove or replace the Administrators; these voting rights are exclusive
to the Company (as the holder of the Common Securities). No resignation or
removal of a Trustee and no appointment of a successor trustee will be effective
until the successor trustee accepts such appointment in accordance with the
provisions of the applicable Trust Agreement.
Co-Trustees and Separate Property Trustee
Unless a Debenture Event of Default has occurred and is continuing, the
Company (as the holder of the Common Securities) and the Administrators may
periodically appoint one or more persons approved by the Property Trustee to act
either as a co-trustee, jointly with the Property Trustee, or as separate
trustee in order to meet the legal requirements of the TIA or of any
jurisdiction in which any part of the property and assets held by the Property
Trustee under the applicable Trust Agreement may be located. In either case,
such trustee will have the powers designated in the instrument of appointment,
and such trustee will be vested in such capacity any property, title, right or
power necessary or desirable, subject to the provisions of the applicable Trust
Agreement. If the Company does not join in such appointment or a Debenture Event
of Default has occurred and is continuing, the Property Trustee alone will have
power to make such appointment.
Merger or Consolidation of Trustees
Any surviving person of a merger, conversion or consolidation of the
Property Trustee or the Delaware Trustee or any successor person to all or
substantially all the corporate trust business of such Trustee will be the
successor of such Trustee under each Trust Agreement, provided such person is
otherwise qualified and eligible.
Consolidations, Mergers, Sale of Assets or Other Transactions
If the Company (as holder of a majority of the Common Securities) requests
(but without the consent of the holders of Preferred Securities, the Property
Trustee or the Delaware Trustee), a Trust may consolidate or merge with another
trust or transfer or lease substantially all its properties and assets to
another trust if:
o the successor trust either (a) expressly assumes all of the
obligations of such Trust with respect to the Preferred Securities or
(b) substitutes for the Preferred Securities other securities having
substantially the same terms as the Preferred Securities (the
"Successor Securities") that rank the same as the Preferred Securities
in priority regarding distributions and payments on liquidation,
redemption and otherwise;
o the Company expressly appoints a trustee of such successor trust
possessing the same powers and duties as the Property Trustee as the
holder of the Debentures;
o such merger, consolidation, transfer or lease does not cause the
Preferred Securities (or Successor Securities) to be downgraded by any
nationally recognized statistical rating organization;
o such merger, consolidation, transfer or lease does not materially
adversely affect your rights, preferences and privileges as a holder
of the Preferred Securities (or Successor Securities);
o the successor trust has a purpose substantially identical to that of
such Trust;
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o before such merger, consolidation, transfer or lease, the Company has
received an opinion from independent counsel to the Trust to the
effect that (a) such merger, consolidation, transfer or lease does not
materially adversely affect your rights, preferences and privileges as
a holder of the Preferred Securities (or Successor Securities), and
(b) following such merger, consolidation, transfer or lease, neither
the Trust nor such successor trust will be required to register as an
investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act"); and
o the Company (or any permitted successor depositor) owns all of the
common securities of such successor trust and guarantees the
obligations of such successor trust under the Preferred Securities (or
Successor Securities) at least to the extent provided by the
Guarantee.
Unless the consent of holders of 100% of the Liquidation Amount of the Preferred
Securities is obtained, a Trust may not effect such merger, consolidation,
transfer or lease if it would cause such Trust or the successor trust to be
classified as something other than a grantor trust for United States federal
income tax purposes.
Voting Rights; Amendment of Each Trust Agreement
As a holder of Preferred Securities, you will have no voting rights, except
as provided in this Prospectus or the applicable Prospectus Supplement or as
required by law or the applicable Trust Agreement. See "Description of
Guarantees--Modification or Amendment of the Guarantees."
The Company (as holder of the Common Securities), the Property Trustee and
the Delaware Trustee may amend each Trust Agreement periodically without your
consent to:
o cure any ambiguity;
o correct or supplement any provision that is inconsistent with any
other provision;
o make any other provisions which are not inconsistent with the other
provisions of such Trust Agreement; or
o modify, eliminate or add to any provisions that are necessary to
ensure that such Trust (i) will always be classified as a grantor
trust for United States federal income tax purposes; or (ii) will not
be required to register as an "investment company" under the
Investment Company Act.
However, none of the amendments described in the first, second or third points
above can have a material adverse effect on the interests of any holder of
Preferred Securities or Common Securities. Such amendments will become effective
when notice of the amendments is given to the holders of Trust Securities. Each
Trust Agreement may be amended by the Trustees and the Company (as holder of the
Common Securities) with (i) the consent of holders representing at least a
majority (based on Liquidation Amounts) of the outstanding Trust Securities, and
(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. The consent of each
holder of Trust Securities will be required to amend a Trust Agreement to:
o 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 regarding the Trust Securities on a
specified date; or
o restrict the right of a holder of Trust Securities to institute suit
for the enforcement of any such payment beginning on such date.
The Property Trustee shall determine the validity of requests or votes in
the event of a dispute among the holders of Trust Securities and the
Administrators or the Trustees.
If any Debentures are held by the Property Trustee, the Property Trustee
will not:
o direct the time, method or place of conducting any proceeding for any
remedy available to the Debenture Trustee, or execute any trust or power
conferred on the Debenture Trustee regarding such Debentures,
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o waive any past default that is waivable under the Indenture,
o exercise any right to rescind or annul a declaration that the
principal of all the Debentures will be due and payable or
o consent to any amendment, modification or termination of the Indenture
or such Debentures, where such consent will be required, without, in
each case, obtaining the prior approval of the holders of a majority
of the Liquidation Amount of all outstanding Preferred Securities.
If a consent under the Indenture would require the consent of each holder
of Debentures affected, no such consent will be given by the Property Trustee
without the prior consent of each holder of the Preferred Securities. The
Property Trustee will not revoke any action previously authorized or approved by
a vote of the holders of the Preferred Securities except by a subsequent vote of
the holders of the Preferred Securities. The Property Trustee will notify you as
a holder of Preferred Securities of any notice of default with respect to the
Debentures. In addition to obtaining the approvals of the holders of the
Preferred Securities described above, before taking any of the actions described
above, the Property Trustee will obtain (at the Company's expense) an opinion of
counsel to the effect that such action would not cause the Trust to be
classified as something other than a grantor trust for United States federal
income tax purposes.
Any required approval of holders of Preferred Securities may be given at a
meeting of holders of Preferred Securities called for such purpose or pursuant
to written consent. The Property Trustee will cause a notice of any meeting at
which holders of Preferred Securities are entitled to vote to be given to each
holder of record of Preferred Securities in the manner set forth in each Trust
Agreement.
No vote or consent by you as a holder of Preferred Securities will be
required for a Trust to redeem and cancel its Preferred Securities in accordance
with the applicable Trust Agreement.
Any of the Preferred Securities that are owned by the Company, the Trustees
or any affiliate of the Company or any Trustees, will be treated as if they were
not outstanding for purposes of the votes or consents described above.
Global Preferred Securities
All or a part of the Preferred Securities of a series may be issued in the
form of one or more Global Preferred Securities that are to be deposited with
the Depositary or its nominee, unless the applicable Prospectus Supplement
states differently. For each of the series of Preferred Securities, the
Depositary will be DTC, unless the applicable Prospectus Supplement states
differently. Global Preferred Securities will be issued only in fully registered
form but may be in either temporary or permanent form. Unless and until it is
exchanged for the individual Preferred Securities each Global Preferred Security
will be transferred only as a whole. Transfers of Global Preferred Securities
are permitted between the following entities:
o by the Depositary for such Global Preferred Security to a nominee of
such Depositary;
o by a nominee of such Depositary to such Depositary or another nominee
of such Depositary; or
o by the Depositary or any nominee to a successor Depositary or any
nominee of such successor.
While each Prospectus Supplement will describe the depositary arrangements
with respect to each series of Preferred Securities, the Company expects the
following terms will apply to all of the depositary arrangements.
The Depositary or its nominee will credit on its book-entry registration
and transfer system, the respective Liquidation Amounts of the individual
Preferred Securities represented by the corresponding Global Preferred
Securities issued and deposited with them to the accounts of Participants, which
may include Euroclear and Cedel. The dealers, underwriters or agents or the
Company (if the Company offers and sells such Preferred Securities directly)
will designate these accounts for the respective Preferred Securities.
The ownership of beneficial interests in a Global Preferred Security is
limited to the Participants or persons that may hold interests through
Participants, including Euroclear and Cedel and their participants. Actual
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ownership of beneficial interests in each Global Preferred Security will only be
shown on, and the transfer of ownership will be completed through, records of
the applicable Depositary or its nominee (for interests of Participants) and the
records of Participants (for interests of persons who hold through
Participants). However, because the laws of some states require certain
purchasers of securities to take physical delivery of such securities in
definitive form, rather than through a Global Preferred Security, such
restrictions may impair the ability to transfer beneficial interests in a Global
Preferred Security.
For all purposes under each Trust Agreement and as long as either the
Depositary or its nominee is the registered owner of the corresponding Global
Preferred Security, such Depositary or such nominee will be considered the sole
owner or holder of the Preferred Securities represented by such Global Preferred
Security.
Except as provided below, owners of beneficial interests in a Global
Preferred Security:
o will not be entitled to have any of the individual Preferred
Securities represented by the corresponding Global Preferred Security
registered in their names;
o will not receive physical delivery of any such Preferred Securities of
such series in a definitive form; and
o will not be considered the owners or holders of such Preferred
Securities under the Trust Agreement.
Payments of principal, any premium and any interest on individual Preferred
Securities represented by a Global Preferred Security registered in the name of
a Depositary or its nominee will be made to the Depositary or its nominee, as
the case may be. None of the Company, the Property Trustee, any paying agent or
the securities registrar for such Preferred Securities will be responsible or
liable for any aspect of the records relating to or payments made on account of
beneficial ownership interests in the Global Preferred Security representing
such Preferred Securities. They also will not be responsible for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
When it receives any payment of Liquidation Amount, Redemption Price,
premium or Distributions regarding a permanent Global Preferred Security
representing any of Preferred Securities, the Company expects the Depositary or
its nominee to immediately credit each Participant's account with payments in
amounts proportionate to its respective beneficial interest in the Global
Preferred Security. Each Participant's beneficial interest will be shown on the
records of such Depositary or its nominee.
The Company also expects that payments by Participants to owners of
beneficial interests in such Global Preferred Security will be governed by the
standing instructions and customary practices as now apply to securities held
for customer accounts in bearer form or registered in "street name." These
Participants will be responsible for such payments.
If a Depositary for a series of Preferred Securities is at any time
unwilling, unable or ineligible to continue as depositary and a successor
depositary is not appointed by a Trust within 90 days, such Trust will issue
individual Preferred Securities of such series in exchange for the Global
Preferred Security representing such series of Preferred Securities, unless the
applicable Prospectus Supplement states differently. A Trust may at any time and
in its sole discretion, subject to any limitations described in the applicable
Prospectus Supplement, determine not to have any Preferred Securities of such
series represented by one or more Global Preferred Securities. In such case,
such Trust will issue certificated Preferred Securities of such series in
exchange for the Global Preferred Security.
An owner of beneficial interest in a Global Preferred Security may be
permitted to receive individual certificated Preferred Securities of a series in
exchange for the beneficial interests in the Global Preferred Securities, on
terms acceptable to each Trust, the Property Trustee and the Depositary and
subject to any limitations in the applicable Prospectus Supplement. In such
case, the owner of a beneficial interest in a Global Preferred Security will be
entitled to physical delivery of certificated Preferred Securities of the series
that is equal in its aggregate Liquidation Amount to the owner's beneficial
interest in the corresponding Global Preferred Security. The applicable Trust
will register such Preferred Securities in the owner's name in the denominations
specified for such series in the applicable Prospectus Supplement.
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Payment and Paying Agency
Payments on the Preferred Securities will be made to the Depositary, which
will credit the relevant accounts at the Depositary on the applicable
Distribution Dates, or if any Trust's Preferred Securities are not held by the
Depositary, such payments will be made by check mailed to the address appearing
on the register of the holder entitled to such payment. The paying agent will
initially be the Property Trustee and any co-paying agent chosen by the Property
Trustee and acceptable to the Administrators and the Company, unless the
applicable Prospectus Supplement states differently. The paying agent will be
permitted to resign as paying agent with 30 days' written notice to the Property
Trustee and the Company. If the paying agent resigns or its authority to act is
revoked, the Administrators will appoint a successor (which will be a bank or
trust company acceptable to the Administrators and the Company) to act as paying
agent.
Securities Registrar and Transfer Agent
The Property Trustee will initially act as securities registrar and
transfer agent for the Preferred Securities, unless the applicable Prospectus
Supplement states differently.
There will be no service charge for any registration of transfer or
exchange of Preferred Securities, although payment of certain taxes and other
governmental charges may be required. The securities registrar will not be
required to (i) register the transfer or exchange of any Preferred Securities
during a period beginning at the opening of business 15 days before the mailing
of a notice of redemption of Preferred Securities and ending at the close of
business the day of such mailing or (ii) transfer or exchange any Preferred
Securities so selected for redemption, except any portion of any Preferred
Securities not being redeemed in a partial redemption.
Information Concerning the Property Trustee and the Delaware Trustee
The Property Trustee will have all the duties and responsibilities
specified in the applicable Trust Agreement. After the occurrence and
continuation of an Event of Default, the Property Trustee must exercise the same
degree of care and skill as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is not under any obligation to exercise any of
the rights or powers vested in it by the applicable Trust Agreement at the
request of any holder of Trust Securities unless it is offered reasonable
indemnity against the costs, expenses and liabilities which might be incurred.
If no Event of Default has occurred and is continuing and the Property Trustee
is required to decide between alternative courses of action, construe ambiguous
or inconsistent provisions in the applicable Trust Agreement or is unsure of the
application of any provision of the applicable Trust Agreement, and the matter
is not one on which you as a holder of Preferred Securities are entitled to vote
under such Trust Agreement, then the Property Trustee will take such action as
is directed by the Company and if not so directed, may take such action as it
deems advisable and in the best interests of the holders of the Trust Securities
and will have no liability except for its own bad faith, negligence or willful
misconduct.
The Delaware Trustee will not have any of the duties and responsibilities
of the Administrators or the Property Trustee under the applicable Trust
Agreement. The Delaware Trustee will not be liable for the payment of any
Trust's debt or expenses and will not be liable for any Trust's breach of its
obligations, except for breaches due to the Delaware Trustee's own gross
negligence or willful misconduct.
Miscellaneous
The Administrators and the Property Trustee will conduct the affairs of the
Trusts in a manner (a) so that (i) no Trust will be deemed to be an "investment
company" required to be registered under the Investment Company Act or (ii)
classified as something other than a grantor trust for United States federal
income tax purposes and (b) so that the Debentures will be treated as
indebtedness of the Company for United States federal income tax purposes. The
Administrators, the Property Trustee and the Company (as holder of the Common
Securities) will take any action they determine in their discretion to be
necessary or desirable to accomplish the objectives described above that is not
inconsistent with applicable law, the certificate of trust or the applicable
Trust
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Agreement, and does not materially adversely affect your interests as a holder
of the related Preferred Securities. Each of the Company, the Administrators and
the Trustees may engage in other businesses, whether or not similar to the
business of the applicable Trust and the holders of Trust Securities will have
no right to participate in such businesses.
You have no preemptive or similar rights as a holder of Preferred
Securities.
No Trust may borrow money or issue debt or pledge any of its assets.
DESCRIPTION OF GUARANTEES
The Company will execute and deliver the Guarantees at various times for
your benefit as a holder of Preferred Securities. This is a summary and is not
complete. This summary does not describe certain exceptions and qualifications
contained in the Guarantees. You should read the Guarantees, a form of which is
filed as an exhibit to the Registration Statement. Each Guarantee will be
qualified as an indenture under the TIA. Unless the applicable Prospectus
Supplement states differently, The Chase Manhattan Bank will act as independent
indenture trustee for TIA purposes under each Guarantee (the "Guarantee
Trustee"). Each Guarantee will be held by the Guarantee Trustee for your benefit
as a holder of the Preferred Securities of the applicable Trust.
General
Unless the applicable Prospectus Supplement states differently, under each
Guarantee, the Company irrevocably agrees to pay in full, and on a subordinated
and junior basis, the following payments regarding the Preferred Securities (the
"Guarantee Payments") if they are not paid by the applicable Trust:
o any accumulated and unpaid Distributions required to be paid on such
Preferred Securities, to the extent such Trust has funds available at
such time;
o the Redemption Price, with respect to any Preferred Securities called
for redemption, to the extent such Trust has funds available at such
time; and,
o if a voluntary or involuntary dissolution, winding up or liquidation
of such Trust occurs, and a distribution of Debentures to you as a
holder of such Preferred Securities is not made, an amount equal to
the lesser of either (i) the Liquidation Distribution or (ii) the
aggregate of the Liquidation Amount and all accumulated and unpaid
Distributions on the Preferred Securities to the date of payment, to
the extent such Trust has funds available for that purpose.
Both the Company's and each Trust's payments to the holders of the applicable
Trust Securities of the amounts required under the Guarantees will satisfy the
obligations to make the Guarantee Payments.
Each Guarantee will be an irrevocable guarantee on a subordinated basis of
the related Trust's obligations under the Trust Securities, but will apply only
to the extent that such Trust has funds sufficient to make such payments and
does not guarantee collection.
If the Company does not make interest or principal payments on the
Debentures purchased by such Trust, that Trust will not be able to pay any
distributions on its Preferred Securities because it will not have the funds to
do so. Each Guarantee will rank subordinate and junior in right of payment to
all of the Company's Senior Debt. See "--Status of the Guarantees." Because the
Company is a holding company, its right to participate in any distribution of
assets of any subsidiary, on such subsidiary's liquidation or reorganization or
otherwise, is subject to the prior claims of such subsidiary's creditors.
Accordingly, the Company's obligations under the Guarantees will be effectively
subordinated to all existing and future liabilities of its subsidiaries. Holders
of Preferred Securities should look only to the assets of the Company for
payments under the Guarantees.
Except as otherwise provided in the applicable Prospectus Supplement, the
Guarantees do not limit the amount of other secured or unsecured debt of the
Company, including Senior Debt, whether under the Indenture, any other existing
indenture, or any other indenture that the Company may enter into in the future
or otherwise.
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The Company has, through the execution of the applicable Guarantee, Trust
Agreement, series of Debentures and the Indenture, fully, irrevocably and
unconditionally guaranteed all of each Trust's obligations under the 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
through the combined operation of these documents that the full, irrevocable and
unconditional guarantee of each Trust's obligations under the Preferred
Securities is provided. See "Relationship Among Debentures, Preferred Securities
and Guarantees."
Status of the Guarantees
Each Guarantee will constitute an unsecured obligation of the Company and
will rank subordinate and junior in right of payment to all Senior Debt of the
Company in the same manner as the Debentures. The Guarantees do not place any
limitation on the amount of additional Senior Debt that the Company may incur.
The Company expects to periodically incur additional indebtedness constituting
Senior Debt.
Each Guarantee will rank equally with all other Guarantees to be issued by
the Company and will be held for your benefit as a holder of the related
Preferred Securities. Each Guarantee will constitute a guarantee of payment and
not of collection, and will permit the guaranteed party to bring legal
proceedings directly against the guarantor to enforce its rights under the
Guarantee without first instituting a legal proceeding against any other person
or entity. No Guarantee will be discharged except by payment of the Guarantee
Payments in full (to the extent not paid by the Trust), when the Debentures are
distributed to you as a holder of the Preferred Securities or when the
applicable Trust dissolves and full payment of amounts payable under the
applicable Trust Agreement is made.
Modification or Amendment of the Guarantees
If any changes materially adversely affects your rights as a holder of the
related Preferred Securities, no Guarantee may be amended without the prior
approval of the holders of at least a majority of the Liquidation Amount of such
outstanding Preferred Securities. The manner of obtaining any such approval is
set forth under the section entitled "Description of Preferred
Securities--Voting Rights; Amendment of Each Trust Agreement."
Assignment
All guarantees and agreements contained in each Guarantee will bind the
successors, assigns, receivers, trustees and representatives of the Company and
will inure to the benefit of the holders of the related Preferred Securities
then outstanding. The Company must obtain the prior approval of the holders of
at least a majority of the Liquidation Amount of the Preferred Securities in
order to assign its rights or obligations under the applicable Guarantee.
However, this requirement does not apply if the assignment is in connection with
a merger or consolidation of, or the sale of assets by or to, the Company.
Events of Default
An event of default under each Guarantee will occur if the Company fails to
perform any of its payment or other obligations under such Guarantee. When such
a default occurs, the holders of at least a majority of the Liquidation Amount
of the related Preferred Securities have the right to direct the time, method
and place of a proceeding for any remedy that is available to the Guarantee
Trustee or to direct the exercise of any trust or power conferred on the
Guarantee Trustee under such Guarantee.
As a holder of Preferred Securities, you may institute legal proceedings
directly against the Company to enforce its rights under such Guarantee without
first bringing legal proceedings against the applicable Trust, the Guarantee
Trustee, or any other person or entity.
As guarantor, the Company is required to file an annual certificate with
the Guarantee Trustee stating whether the Company is in compliance with all
applicable conditions and covenants under the Guarantees.
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Information Concerning the Guarantee Trustee
The Guarantee Trustee will have all the duties and responsibilities
specified in the applicable Guarantee. After the occurrence and continuation of
a Guarantee default, the Guarantee Trustee 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 is not under any
obligation to exercise any of the powers vested in it by any Guarantee at the
request of the holder of any Preferred Securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that might be
incurred.
Termination of the Guarantees
Each Guarantee will terminate and be of no further force and effect if any
of the following occurs: o full payment of the Redemption Price of the related
Preferred Securities; o full payment of the amounts payable on dissolution of
the related Trust; or o the distribution of Debentures to the holders of
Preferred Securities that have been exchanged.
However, if at any time you as a holder of the related Preferred Securities must
pay back any sums paid under such Preferred Securities or such Guarantee, each
such Guarantee will continue to be effective or will be reinstated.
Governing Law
Each Guarantee will be governed by and construed in accordance with the
laws of the State of New York.
RELATIONSHIP AMONG DEBENTURES, PREFERRED SECURITIES
AND GUARANTEES
Full and Unconditional Guarantee
The Company irrevocably guarantees the amounts due on the Preferred
Securities, including Distribution payments, as described under "Description of
Guarantees" but only to the extent the related Trust has funds available for
such payments. The documents of each series of Debentures, the Indenture, the
related Trust Agreement and the related Guarantee, together create this full,
irrevocable and unconditional guarantee of all Distribution payments and other
amounts due on the related Preferred Securities on behalf of the Company. All of
the documents are required to enforce a full, irrevocable and unconditional
guarantee against the Company. It is only the combined operation of these
documents that provides for a full, irrevocable and unconditional guarantee of
each Trust's obligations under the related Preferred Securities.
If the Company does not make payments on any series of Debentures, then the
corresponding Trust will not pay Distributions or other amounts due on the
related Preferred Securities. The Guarantees only cover payment of Distributions
to the extent that the related Trust has sufficient funds to pay such
Distributions.
If a Trust does not have sufficient funds to pay, you as a holder of a
series of Preferred Securities may institute a legal proceeding directly against
the Company in order to enforce payment. The Company's obligations under each
Guarantee are subordinate and junior in right of payment to all of the Company's
Senior Debt.
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Sufficiency of Payments
The Company's payment of the interest and other payments when due on each
series of Debentures will be sufficient to cover a Trust's Distributions and
other payments due on the related Preferred Securities. There are four primary
reasons why payments on the Debentures will cover the payments due on the
related Preferred Securities:
o the aggregate principal amount of each series of Debentures will equal
the sum of the aggregate stated Liquidation Amount of the related
Preferred Securities and related Common Securities;
o both the interest rate and the interest and other payment dates on
each series of Debentures will match the Distribution rate and
Distribution and other payment dates for the related Preferred
Securities;
o the Company will pay for all and any costs, expenses and liabilities
of such Trust, except the Trust's obligations to holders of its
Preferred Securities; and
o each Trust Agreement provides that the Trust will not engage in any
activity that is inconsistent with the limited purposes of such Trust.
Except as set forth in the Indenture, the Company may set-off any payment
that it is otherwise required to make under the Indenture with payments it has
made or is making under the related Guarantee.
Enforcement Rights of Holders of Preferred Securities
As a holder of a Preferred Security, you may bring a legal proceeding
directly against the Company to enforce its rights under the related Guarantee.
In order to do so, you do not need to first institute a legal proceeding against
any of the Guarantee Trustee, the related Trust or any other person or entity.
A default or event of default under any of the Company's Senior Debt does
not constitute a default or Debenture Event of Default under the Indenture.
However, if there are any payment defaults under the Company's Senior Debt or it
is accelerated, no payments may be made relating to the Debentures until either
such Senior Debt has been paid in full or any payment default under the Senior
Debt has been cured or waived. Failure to make required payments on any series
of Debentures would constitute a Debenture Event of Default under the Indenture.
Limited Purpose of Trusts
Each Trust's Preferred Securities creates a preferred undivided beneficial
interest in the assets of such Trust, and each Trust exists for the sole purpose
of issuing its Trust Securities and investing the proceeds of such Trust
Securities in Debentures. A principal difference between your rights as a holder
of a Preferred Security and those of the applicable Trust as a holder of a
Debenture is that the holder of a Debenture may receive the principal amount of
and interest accrued on Debentures held from the Company, while the holder of
Preferred Securities may only receive Distributions from such Trust (or from the
Company under the applicable Guarantee) to the extent such Trust has sufficient
funds available to pay such Distributions.
Rights On Dissolution
If a voluntary or involuntary dissolution that involves the liquidation of
Debentures of any Trust occurs, you as a holder of the related Preferred
Securities will be entitled to receive out of the assets of such Trust (after
satisfaction of liabilities to creditors as provided by applicable law) the
Liquidation Distribution in cash. See "Description of Preferred
Securities--Liquidation Distribution On Dissolution."
If a voluntary or involuntary liquidation or bankruptcy of the Company
occurs, the Property Trustee (as holder of the Debentures) would become a
subordinated creditor of the Company and would be subordinated in right of
payment to all Senior Debt. However, the Property Trustee would be entitled to
receive payment in full of principal and interest, before any of the Company's
stockholders receive payments or distributions. The Company is the guarantor
under each Guarantee and has agreed to pay for all costs, expenses and
liabilities of each Trust
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(other than the Trust's obligations to the holders of its Preferred Securities).
As a result, in the event of the Company's liquidation or bankruptcy, the
positions of a holder of such Preferred Securities and a holder of such
Debentures relative to the Company's other creditors and stockholders are
expected to be substantially the same.
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DESCRIPTION OF PREFERRED STOCK
The general terms of the Company's Preferred Stock, par value $1.00 per
share (the "Preferred Stock"), are described in the Company's Certificate of
Incorporation, and the specific terms of each series of Preferred Stock will be
described in the applicable Prospectus Supplement and Certificate of
Designation. This is a summary and is not complete. This summary describes the
dividend, liquidation, redemption and voting rights applicable to all Preferred
Stock. This summary does not include certain exceptions and qualifications
contained in the Certificate of Incorporation and Certificates of Designation.
You should read the Certificate of Incorporation and the applicable Certificate
of Designation, which are either filed as exhibits to or will be incorporated by
reference in the Registration Statement. You should also read the applicable
Prospectus Supplement for information relating to a particular series of
Preferred Stock.
General
The Company is authorized to issue 10,000,000 shares of Preferred Stock.
The Preferred Stock may be issued in one or more series. The Certificate of
Incorporation and the Board of Directors' resolutions providing for such
issuance describe the designations, voting powers, preferences and relative,
participating, optional or other special rights, and corresponding
qualifications, limitations or restrictions.
The Company may issue Depositary Shares which will represent fractional
interests in shares of Preferred Stock. For a description of such Depositary
Shares in the event Depositary Shares are issued, see "Description of Depositary
Shares."
The actual dividend, liquidation, redemption and voting rights of the
Preferred Stock as described in the applicable Prospectus Supplement may be
different from the general description in this summary. You should refer to the
Prospectus Supplement relating to the particular series of Preferred Stock for
specific terms, such as:
o the designation, stated value and liquidation preference;
o the number of shares offered;
o the initial public offering price for the particular series;
o the dividend rate(s) (or method of calculation), the date(s) from
which dividends shall accrue, and whether such dividends shall be
cumulative or noncumulative (and, if cumulative, the date accumulation
begin);
o any redemption or sinking fund provisions;
o the amount of payments on liquidation, dissolution or winding-up of
the Company;
o the terms for exchanging Preferred Stock for other securities of the
Company;
o any additional voting rights;
o any information regarding reissuance or sale of shares which have been
redeemed, purchased or otherwise reacquired, or surrendered to the
Company on conversion or exchange;
o any conditions or restrictions on the Company on dividends or other
distributions on, or acquiring the Company's Common Stock or other
capital stock of the Company that ranks junior to (regarding dividends
and treatment upon liquidation) the Preferred Stock;
o any conditions or restrictions on the Company (or any subsidiary) on
incurring debt or issuing capital stock that ranks equally with or
senior to (regarding dividends and treatment upon liquidation) the
Preferred Stock; and
o any additional dividend, liquidation, redemption, sinking or
retirement fund or other rights, preferences, privileges, limitations
or restrictions of such Preferred Stock.
The Preferred Stock will be fully paid and nonassessable when it is issued.
Unless otherwise specified in the applicable Prospectus Supplement, your
Preferred Stock will rank equally in all respects to the outstanding shares of
Preferred Stock. As of October 30, 1998, there were outstanding 3,729,250 shares
of the Company's Preferred Stock. The Preferred Stock will have no preemptive
rights to subscribe for any additional securities that may be issued by the
Company.
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Dividends
Unless the applicable Prospectus Supplement states differently, you will be
entitled to receive dividends on the Preferred Stock before any may be declared
or paid on the Common Stock (or on any other junior capital stock of the Company
junior to the Preferred Stock regarding payment of dividends, liquidation or
other preferences ("junior capital stock"). Dividends will be paid on each
January 15, April 15, July 15 and October 15, at the rates specified in the
applicable Prospectus Supplement. Such rates may be fixed or variable or both.
Any formula used to determine the variable rate will be described in the
applicable Prospectus Agreement. The record date, as fixed by the Board of
Directors, will be at least 15 days but no more than 60 days before a dividend
payment date. Dividends will be paid in cash.
The applicable Prospectus Supplement will specify whether dividends are
cumulative or noncumulative. If the Board of Directors does not declare a
dividend for a particular dividend payment date and dividends are noncumulative,
then you will not receive a dividend for that period. If dividends on a
particular series are not paid in full (or declared in full with the payment
amount set apart), then such dividends will not be declared and paid unless
dividends are declared and paid proportionately on all other series of
outstanding Preferred Stock (including any accrued dividends or dividends in
arrears).
Any conditions or restrictions on the Company on dividends or other
distributions on, or purchasing, redeeming or otherwise acquiring Common Stock
(or any other junior capital stock) will be stated in the applicable Prospectus
Supplement.
Liquidation Rights
If the Company is voluntarily or involuntarily liquidated, dissolved or
wound-up, as a holder of Preferred Stock, you will be entitled to receive the
amount specified in the applicable Prospectus Supplement, together with all
accrued and unpaid dividends, before any distribution of the Company's assets
will be made to the holders of Common Stock (or any other junior capital stock).
After such distribution, you will not be entitled to any additional
distribution. If there are not enough assets to pay all holders of a series of
Preferred Stock in full, then such assets will be distributed proportionately
among the holders.
Neither the consolidation, merger or other business combination of the
Company with another entity nor the transfer of all or any part of the Company's
property, assets or business will be considered a liquidation, dissolution or
winding up of the Company.
Redemption
As stated in the applicable Prospectus Supplement, the Company may redeem
all or a part of any series of Preferred Stock at its option or when specified
events occur. If the Company plans to redeem only a part of a series, those
shares will be selected by lot or treated proportionately, as determined by
resolution of the Board of Directors.
The Company must publish notice of any redemption in a newspaper at least
20 but no more than 50 days before the redemption date. The Company will also
mail a similar notice within that same time period. The Board of Directors may
fix a record date at least 20 but no more than 50 days before the redemption
date.
Before the redemption date, the Company will deposit money for the
redemption payment with a bank or trust company. On the redemption date, all
dividends on the series of Preferred Stock called for redemption will stop
accruing and all your rights will end (except your right to receive the
redemption price without interest). Any funds which remain unclaimed by the
holders for six years after the redemption date will become the property of the
Company.
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Conversion Rights
No series of Preferred Stock will be convertible into Common Stock.
Voting Rights
Unless the applicable Prospectus Supplement states that the Board of
Directors has determined differently, or as required by law, you can vote only
if dividends on your series of Preferred Stock (or any other capital stock
ranking equally with that series) have been in arrears for six calendar quarters
(whether consecutive or not). In that case, you will be entitled to vote for the
election of two of the Company's directors at the annual meetings of
stockholders until all accumulated dividends have been fully paid or set apart
for payment. You will vote with all other holders of other series of Preferred
Stock that are in the same situation as a separate class. Each holder will have
one vote for each share held. Directors elected in this manner will hold office
for so long as these holders are entitled to this voting right.
So long as any series of Preferred Stock remains outstanding, the Company
will need the consent of the holders of at least two-thirds of the shares of
that series (voting separately as a class with all other series of Preferred
Stock with like voting rights) to:
o issue or increase the authorized amount of any class or series of
stock ranking senior to that series regarding dividends or
liquidation; or
o amend or repeal the provisions of the Certificate of Incorporation or
the Certificate of Designation (whether by merger, consolidation or
otherwise), in a way that materially adversely affects any power,
preference or special right of that series.
Any increase in the amount of the authorized Common or Preferred Stock or the
creation and issuance of Common Stock or any other series of Preferred Stock
ranking equally with or junior to a series of Preferred Stock will not be
considered to materially adversely affect the powers, preferences or special
rights of the shares of that series.
Unless the applicable Prospectus Supplement states differently, the
transfer agent, dividend disbursing agent and registrar for each series of
Preferred Stock will be ChaseMellon Shareholder Services L.L.C.
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DESCRIPTION OF DEPOSITARY SHARES
The Depositary Shares will represent fractional interests in shares of
Preferred Stock. As a holder of Depositary Shares, you will be entitled to a
proportionate share of all the rights and preferences of a holder of Preferred
Stock (for example, dividend, voting, redemption and liquidation rights). Your
proportionate rights and preferences will be subject to the applicable Deposit
Agreement. This is a summary and is not complete. This summary does not describe
certain exceptions and qualifications contained in the Deposit Agreement. You
should read the Deposit Agreement, a form of which is filed as an exhibit to the
Registration Statement.
General
The Depositary will issue Depositary Receipts to evidence Depositary
Shares. Each Depositary Receipt will represent a fractional interest (to be
specified in the applicable Prospectus Supplement) in a share of a particular
series of Preferred Stock.
The Depositary Shares will be deposited under a Deposit Agreement among the
Company, a bank or trust company selected by the Company as the Depositary and
the holders of the Depositary Receipts. The Depositary must be a bank or trust
company having its principal office in the United States and having a combined
capital and surplus of at least $50,000,000. The name and address of the
Depositary will be specified in the applicable Prospectus Supplement.
Before the definitive engraved Depositary Receipts are available, the
Depositary may issue temporary Depositary Receipts substantially identical to
the definitive Depositary Receipts. Definitive Depositary Receipts will be
prepared within a reasonable time and will be exchanged for the temporary
Depositary Receipts at the Company's expense.
Dividends and Other Distributions
The Depositary will distribute to the holders of Depositary Receipts all
cash dividends or other cash distributions on the fractional shares of Preferred
Stock. These cash dividends and other cash distributions will be distributed
proportionately (based on holdings of the Depositary Shares on the applicable
record date). The Depositary will not distribute amounts less than one cent. The
Depositary will hold any such balances of fractional cents, without liability
for interest on these balances. The Depositary will distribute these balances
with the next sum received for distribution to holders of Depositary Receipts
then outstanding.
If the Company distributes property other than cash, the Depositary will
distribute the property as close to proportionately as possible (based on
holdings of the Depositary Shares on the applicable record date). If the
Depositary determines that it is not feasible to make such a distribution, the
Depositary may (with the approval of the Company) sell the property and
distribute the net proceeds of such sale or use some other fair and practical
method to make the distribution.
Each Deposit Agreement will also explain how holders of Depositary Shares
can participate in any subscription or similar rights offered by the Company to
holders of the Preferred Stock deposited under such Deposit Agreement.
Redemption of Depositary Shares
When all or a part of the shares of corresponding Preferred Stock are
redeemed, the Depositary will redeem the Depositary Shares with the proceeds
received from the redemption of the Preferred Stock. Whenever the Company
redeems shares of Preferred Stock held by a Depositary, the Depositary will
redeem a number of Depositary Shares representing the number of shares of
Preferred Stock redeemed by the Company. The Depositary Shares will be redeemed
on the same redemption date as the corresponding Preferred Stock. The Depositary
will mail any notice of redemption at least 20 days but not more than 50 days
before the redemption
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date. The redemption price per Depositary Share will be equal to the applicable
fraction of the redemption price per share of the Preferred Stock. If only a
part of the Depositary Shares are to be redeemed, the Depositary may select by
lot or redeem a proportionate amount of all Depositary Shares.
Beginning on the redemption date, the Depositary Shares called for
redemption will no longer be considered outstanding. All rights of the holders
of such Depositary Shares will cease, except for the right to receive the moneys
payable or rights to which the holders were otherwise entitled on such
redemption.
Voting Rights
As soon as practical after the Depositary receives notice of any meeting at
which the holders of shares of Preferred Stock may vote, the Depositary will
mail the information contained in that notice of meeting (and any accompanying
proxy materials) to the holders of the Depositary Shares on the record date for
such meeting. Each such holder will be able to instruct the Depositary on how to
exercise the voting rights of the corresponding Preferred Stock. The Depositary
will endeavor to vote the Preferred Stock in accordance with such holder's
instructions. The Company will agree to take all action the Depositary considers
necessary to enable it to do so. The Depositary will abstain from voting shares
of Preferred Stock for which it has not received specific instructions from the
holders of the applicable Depositary Shares.
Withdrawal of Stock
An owner of Depositary Shares which have not been called for redemption and
who surrenders the Depositary Receipts at the Depositary's principal office will
be entitled to whole shares of Preferred Stock and all money and any other
property represented by those Depositary Shares. Fractional shares of Preferred
Stock will not be delivered. If the Depositary Receipts surrendered by the
holder are greater than the number of whole shares of Preferred Stock to be
withdrawn, the Depositary will also deliver to such holder a new Depositary
Receipt for the fractional shares. If you withdraw Preferred Stock in this way,
you will not be able to deposit them under a Deposit Agreement or to exchange
them for Depositary Shares. The Company expects that a public trading market
will exist only for Depositary Shares and not for the corresponding Preferred
Stock.
Amendment and Termination of the Deposit Agreement
The Company and the Depositary may agree to change the form of Depositary
Receipt or any provision of a Deposit Agreement. However, any amendment that
materially adversely alters the rights of the existing holders of Depositary
Shares requires the approval by the holders of at least a majority of the
Depositary Shares then outstanding under that Deposit Agreement. Each Deposit
Agreement will provide that each holder of Depositary Shares who continues to
hold those Depositary Shares when an amendment becomes effective will be
considered to have consented to the amendment and will be bound by the
amendment. Except to comply with any mandatory provisions of law or as otherwise
provided in the related Deposit Agreement, no amendment may impair the right of
any holder of any Depositary Shares to surrender the Depositary Receipt to the
Depositary together with instructions to deliver to such holder the whole shares
of Preferred Stock represented by the surrendered Depositary Shares and all
money and any other property represented by such Depositary Shares. A Deposit
Agreement may be terminated by the Company or the Depositary only if:
o all outstanding Depositary Shares issued under the Deposit Agreement
have been redeemed; or
o in connection with the liquidation, dissolution or winding-up of the
Company, there has been a final distribution of the corresponding
Preferred Stock, and the Depositary has distributed the amount it
received to the holders of those Depositary Shares.
Charges of the Depositary
The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. The Company
will pay charges of any Depositary in connection with the initial deposit of
Preferred Stock and the initial issuance of the applicable Depositary Shares and
any redemption of such
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Preferred Stock. Holders of Depositary Shares will pay any other taxes and
charges incurred for their accounts as provided in the applicable Deposit
Agreement.
Miscellaneous
Each Depositary will send to the holders of Depositary Shares all reports
and communications it receives from the Company that the Company is required to
furnish to the holders of the Preferred Stock. Each Depositary will also make
available for inspection by the holders of those Depositary Shares, at the
principal office of such Depositary and at such other places as it considers
advisable, all reports and communications received from the Company that are
received by such Depositary as the holder of Preferred Stock.
The Depositary and the Company assume liability under a Deposit Agreement
to holders of the Depositary Shares only for negligence or willful misconduct.
Neither any Depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under a Deposit Agreement. The obligations of the Company and any
Depositary under a Deposit Agreement will be limited to good faith performance
of their duties. Neither the Depositary nor the Company will be obligated to
prosecute or defend any legal proceeding regarding any Depositary Shares or
Preferred Stock unless satisfactory indemnity is provided. The Company and any
Depositary may rely on written advice of counsel or accountants, on information
provided by persons presenting Preferred Stock for deposit, holders of
Depositary Shares or other persons believed in good faith to be competent to
give such information. The Depositary and the Company may also rely on documents
they believe are genuine and signed or presented by the proper party or
party(ies).
Owners of the Depositary Shares will be treated as if they were owners of
the Preferred Stock for United States federal income tax purposes.
Resignation and Removal of Depositary
A Depositary may resign at any time by delivering a notice of resignation
to the Company. The Company may remove any Depositary at any time. Any such
resignation or removal will be effective when a Company-appointed successor
accepts the appointment. The successor Depositary must be appointed within 60
days after delivery of the notice of resignation or removal. The successor
Depositary must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $50,000,000.
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BOOK-ENTRY ISSUANCE
Unless otherwise indicated in the applicable Prospectus Supplement, the
Preferred Securities and the Debentures will be issued only in book-entry form.
This means that the Company and the Trusts will not issue certificates to you.
Instead, ownership of the Preferred Securities and the Debentures will be
represented by one or more global certificates that will be registered in the
name of The Depository Trust Corporation, New York, New York ("DTC"), the
securities depositary, or its nominee, Cede & Co. This form will be referred to
as "book-entry only."
One or more fully registered global certificates will be issued for the
Preferred Securities and the Debentures, representing in the aggregate, the
total number of such Trust's Preferred Securities or aggregate principal balance
of Debentures, respectively. These global certificates will be deposited with
the Property Trustee as custodian for DTC.
Any series of Preferred Stock (and the Depositary Shares relating to such
series) may be issued in either certificate or book-entry form, as specified in
the applicable Prospectus Supplement. Ownership of Preferred Stock or Depositary
Shares issued in book-entry form will be represented by one or more global stock
certificates or a global Depositary Receipt registered in the name of DTC, or
its nominee, Cede & Co.
Purchases of Preferred Securities, Debentures, Preferred Stock or
Depositary Shares within the DTC system must be made by or through Participants,
including Euroclear and Cedel, which will receive a credit for the Preferred
Securities, Debentures, Preferred Stock or Depositary Shares on DTC's records.
The ownership interest of the actual purchaser of Preferred Securities,
Debentures, Preferred Stock or Depositary Shares and any transfers of those
interests, are in turn recorded separately on the Participants' records acting
on behalf of the actual owners of the Preferred Securities, Debentures,
Preferred Stock or Depositary Shares. Under book-entry only, none of the
Company, the Trusts or DTC will issue certificates or written confirmations to
individual beneficial holders of their purchases, except if the use of the
book-entry system for the Preferred Securities, Debentures, Preferred Stock or
Depositary Shares is discontinued.
Transfers
Transfers between Participants are completed through the DTC system and are
settled in same-day funds. Transfers between participants in Euroclear and Cedel
will be effected in the ordinary way in accordance with their respective rules
and operating procedures.
Cross-Market Transfers
With respect to cross-market transfers between DTC Participants and
Euroclear or Cedel participants, such transfers will be effected in DTC in
accordance with DTC's rules on behalf of Euroclear or Cedel by its respective
depositary. These cross-market transactions will require the delivery of
instructions to Euroclear or Cedel by the counterparty in such system in
accordance with the rules and procedures and within the established deadlines
(Brussels time) of Euroclear and Cedel. If the transaction meets the respective
system's settlement requirements, Euroclear or Cedel, as applicable, will
deliver instructions to its respective depositary to take action to effect final
settlement on its behalf by delivering or receiving interests in the Preferred
Securities, Debentures, Preferred Stock or Depositary Shares in DTC. Only then
will Euroclear or Cedel make or receive payment in accordance with normal
procedures for same-day funds settlement applicable to DTC. Both Euroclear and
Cedel participants may not deliver instructions directly to the depositaries for
Euroclear or Cedel.
Because of time zone differences involved in cross-market transfers, the
securities account of a Euroclear or Cedel participant purchasing an interest in
a Preferred Security, Debenture, Preferred Stock or Depositary Shares from a DTC
Participant will be credited during the securities settlement processing day
(which must be a business day for Euroclear or Cedel) immediately following the
DTC settlement date, and any such crediting will be reported to the relevant
Euroclear or Cedel participant. Any cash received in Euroclear or Cedel as a
result of
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sales of interests in a Preferred Security, Debenture, Preferred Stock or
Depositary Shares by or through a Euroclear or Cedel participant to a DTC
Participant will be received with value on the DTC settlement date, but will
only be available in the relevant Euroclear or Cedel cash account as of the
business day for Euroclear or Cedel following the DTC settlement date.
Record-Keeping and Notice
DTC will have no knowledge of the actual owners of the beneficial interests
of the Preferred Securities, Debentures, Preferred Stock or Depositary Shares.
Instead, DTC's records reflect only the identity of the Participants to whose
accounts such Preferred Securities, Debentures, Preferred Stock or Depositary
Shares are credited, which may not be the owners of beneficial interests in the
global securities. The Participants will in turn keep account of their holdings
on behalf of their customers.
Conveyance of notices and other communications by DTC to Participants, by
and among Participants, and by Participants to the owners of beneficial
interests, and the voting rights of Participants and owners of beneficial
interests will be governed by arrangements among them, subject to any statutory
or regulatory requirements.
Redemption notices will be sent to Cede & Co. as the registered holder of
the Preferred Securities, Debentures, Preferred Stock or Depositary Shares. If
less than all of a Trust's Preferred Securities or Debentures or less than all
of the Preferred Stock or Depositary Shares are being redeemed, DTC's current
practice is to determine by lot the amount of the interest of each Participant
to be redeemed.
Voting Rights
Although voting with respect to the Preferred Securities, Debentures,
Preferred Stock or Depositary Shares is limited to the holders of record of the
Preferred Securities, Debentures, Preferred Stock or Depositary Shares, in those
instances in which a vote is required, neither DTC nor Cede & Co. will itself
consent or vote with respect to the Preferred Securities, Debentures, Preferred
Stock or Depositary Shares. It is DTC's current practice to mail an omnibus
proxy to the relevant Trustee as soon as possible after the specified record
date. This omnibus proxy assigns Cede & Co.'s consenting or voting rights to
those Participants to whose accounts such Preferred Securities or Debentures are
credited on the record date.
Distribution Payments
Distribution payments on the Preferred Securities, Debentures, Preferred
Stock or Depositary Shares will be made by the relevant Trustee to DTC. When any
payment of principal or interest is received, it is DTC's current practice to
credit the respective Participant's account on the payment date according to
their respective holdings of beneficial interests in the global securities as
shown on DTC's records. Payments by Participants to owners of beneficial
interests in the global securities, and voting by Participants, will be governed
by the customary practices between the Participants and owners of beneficial
interests for customer accounts registered in "street name." However, these
payments will be the responsibility of the Participants (not of DTC), the
relevant Trustee, the applicable Trust or the Company. Payment to DTC of
Distributions is the responsibility of the relevant Trustee; payment to DTC of
cash dividends and other distributions is the responsibility of the Company.
Disbursement of such payments to the Participants is the responsibility of DTC,
while disbursements of such payments to the owners of the beneficial interests
is the responsibility of the Participants.
The Company will wire principal and interest payments to DTC's nominee. The
Company and the Trustee will treat DTC's nominee as the owner of the global
securities for all purposes. Accordingly, neither the Company nor the Trustee is
directly responsible or liable for amounts due on the securities to owners of
the beneficial interests in the global securities.
DTC Services
DTC has provided the Company with the following information:
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o DTC is a limited purpose trust company organized under the New York
Banking Law;
o a "banking organization" within the meaning of the New York Banking
Law;
o a member of the Federal Reserve System; o a "clearing corporation"
within the meaning of the New York Uniform Commercial Code; and
o a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act.
DTC holds securities that its Participants deposit with DTC. Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. DTC also facilitates the
settlement among these 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.
DTC's book-entry system is also available for use by other organizations
such as securities brokers and dealers, banks and trust companies that work
through a Participant, either directly or indirectly ("Indirect Participants").
The rules applicable to DTC and its Participants are on file with the SEC.
DTC is owned by a number of its Participants and by the New York Stock
Exchange, Inc., the American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc.
Discontinuance of DTC Services
DTC may discontinue providing services as securities depositary with
respect to any of the Preferred Securities, Debentures, Preferred Stock or
Depositary Shares at any time by giving reasonable notice to the relevant
Trustee and the Company. Preferred Securities and Debentures represented by a
global security will be exchangeable for Preferred Security or Debenture
certificates with the same terms in authorized denominations only if:
o DTC notifies the Company that it is unwilling or unable to continue as
depositary or if DTC ceases to be a clearing agency registered under
applicable law and a successor depositary is not appointed by the
Company within 90 days; or
o the Company instructs the Trustee, at its option, that the global
security is now exchangeable.
In addition, after a Debenture Event of Default, the holders of a majority
of the Liquidation Amount of Preferred Securities or aggregate principal amount
of Debentures may determine to discontinue the system of book-entry transfers
through DTC. In such case, definitive certificates for such Preferred Securities
or Debentures will be printed and delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Trusts and the Company believe to be
accurate, but the Trusts and the Company assume no responsibility for the
accuracy of such information. Neither the Trusts nor the Company has any
responsibility for the performance by DTC or its Participants of their
respective obligations as described above or under the rules and procedures
governing their respective operations.
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ERISA CONSIDERATIONS
With the possible exception of any class of Preferred Securities which is
listed on a securities exchange or interdealer quotation system, if Benefit Plan
Investors (defined as (i) employee benefit plans under Section 3(3) of ERISA
(whether or not subject to ERISA), (ii) "plans" as defined in Section 4975(e) of
the Internal Revenue Code or (iii) entities deemed to hold plan assets of either
of such plans under Department of Labor regulation 29 C.F.R. ss.2510.3-101
("Plan Assets Regulation") or applicable law), in the aggregate, acquire 25% or
more of the value of any class of Trust Securities (excluding any Trust
Securities owned by the Property Trustee, Delaware Trustee, Company,
Administrators or any of their affiliates), a portion of the assets owned by any
Trust would likely be treated as if they were "plan assets" of any such Benefit
Plan Investors which are subject to Part 4 of Title I of ERISA or Section 4975
of the Code (collectively, "ERISA Plans"). The acquisition of Trust Securities
by Benefit Plan Investors will not be monitored, and there can be no assurance
that Benefit Plan Investors will not at any time own less than 25% of the value
of a class of Trust Securities.
If a class of Preferred Securities is listed on a securities exchange or
interdealer quotation system, it is expected that such class of Preferred
Securities will be freely transferable, widely-held and registered in a timely
fashion under Sections 12(b) or 12(g) of the Exchange Act, so that such
securities will constitute "publicly offered securities" within the meaning of
the Plan Assets Regulation. Accordingly, the acquisition of such Preferred
Securities by Benefit Plan Investors should not result in the assets owned by
any Trust being treated as "plan assets" of such purchasers. The Common
Securities will be held by the Company.
If the assets of any Trust were treated as plan assets, the fiduciary
standards in ERISA and the prohibited transaction provisions of ERISA and
Section 4975 of the Internal Revenue Code (which generally prohibit most direct
or indirect transactions between ERISA Plans and persons who are "parties in
interest" or "disqualified persons" with respect to such plans) would likely
apply to the assets owned by and the operations of such Trust. Under such
circumstances, the Property Trustee, Delaware Trustee and Administrators would
likely be treated as "parties in interest" and "disqualified persons" subject to
the prohibited transaction provisions and could be construed as fiduciaries for
purposes of ERISA with respect to each ERISA Plan owning Preferred Securities.
In addition, the loan between such Trust and the Company, as evidenced by the
Debentures, might constitute a non-exempt prohibited transaction unless the
Company is not a party in interest or a disqualified person with respect to any
ERISA Plan which owns a Trust Security. By virtue of the activities of the
Company and its subsidiaries, the Company is a party in interest and
disqualified person with respect to many ERISA Plans from time to time. Because
of this fact, the acquisition or ownership of Preferred Securities by any ERISA
Plan as to which the Company is a party in interest or disqualified person might
also constitute a prohibited transaction in the absence of a prohibited
transaction exemption, whether or not assets of any Trust are treated as plan
assets.
No ERISA Plan should acquire Preferred Securities unless it qualifies for a
prohibited transaction exemption. Prohibited transaction exemptions that may
apply are transactions: negotiated by "qualified professional asset managers";
(ii) with insurance company pooled separate accounts; (iii) by bank collective
trust funds; (iv) by insurance company accounts; and (v) negotiated by certain
qualified "in-house asset managers". The acquisition of Preferred Securities by
an ERISA Plan shall constitute a representation and warranty by such ERISA Plan
and its fiduciary responsible for such acquisition that such security is being
acquired and held pursuant to an applicable prohibited transaction exemption
and, accordingly, that the acquisition and holding of the securities will not
constitute a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Internal Revenue Code.
This discussion of ERISA Plans and other Benefit Plan Investors is general
and does not cover every situation. Any Benefit Plan Investor considering a
purchase of Preferred Securities should consult with its counsel regarding the
potential consequences of such purchase. In particular, ERISA Plans should
consider the potential consequences if the assets of the Trust were treated as
"plan assets" and the availability and extent of exemptive relief under
applicable prohibited transaction exemptions.
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PLAN OF DISTRIBUTION
The Company and the Trusts may sell the offered securities (a) through
agents; (b) through underwriters; (c) through dealers; (d) directly to one or
more purchasers; or (e) through a combination of any of these methods of sale.
By Agents
Offers to purchase securities may be solicited by agents designated by the
Company. The agents will agree to use their reasonable best efforts to solicit
purchases for the period of their appointment, unless the applicable Prospectus
Supplement states differently.
By Underwriters
If underwriters are used in the sale, the offered securities will be
acquired by the underwriters for their own account. The underwriters may resell
the securities in one or more transactions, including negotiated transactions,
at a fixed public offering price or at varying prices determined by the
underwriters at the time of sale. The obligations of the underwriters to
purchase the securities will be subject to certain conditions. The underwriters
will be obligated to purchase all the securities of the series offered if any of
the securities are purchased. Any initial public offering price and any
discounts or concessions allowed or re-allowed or paid to dealers may be
changed.
By Dealers
If a dealer is used to sell the securities the offered securities will be
acquired by the dealer as principal. The dealer may then resell such securities
to the public at varying prices to be determined by the dealer at the time of
resale.
Direct Sales
Offered securities may also be sold directly by the Company or the
applicable Trust. In this case, no other underwriters, agents or dealers would
be involved.
General Information
Underwriters, dealers and agents that participate in the distribution of
the offered securities may be underwriters as defined in the Securities Act, and
any discounts or commissions received by them from the Company or the applicable
Trust and any profit on the resale of the offered securities by them may be
treated as underwriting discounts and commissions under the Securities Act. Any
underwriters or agents will be identified and their compensation will be
described in the applicable Prospectus Supplement.
The Company or the Trusts may have agreements with the underwriters,
dealers or agents to indemnify them against certain civil liabilities, including
liabilities under the Securities Act, or to contribute with respect to payments
which the underwriters, dealers or agents may be required to make.
The Company or the applicable Trust may authorize agents, underwriters or
dealers to solicit offers by certain institutions to purchase securities
pursuant to delayed delivery contracts providing for payment and delivery on a
specified date in the future. The commission indicated in the applicable
Prospectus Supplement will be paid to underwriters, dealers and agents
soliciting purchases of securities under such delayed delivery contracts
accepted by the Company or the applicable Trust.
Underwriters, dealers and agents may be customers of, engage in
transactions with, or perform services for, the Company or its subsidiaries in
the ordinary course of business.
47
<PAGE>
LEGAL MATTERS
Unless otherwise indicated in the applicable Prospectus Supplement, certain
legal matters will be passed on for the Company by Cadwalader, Wickersham &
Taft, New York, New York, counsel to the Company and for the Trusts by Richards,
Layton & Finger, P.A., Wilmington, Delaware, special Delaware counsel to the
Trusts and the Company. The validity of the Debentures, Guarantees and/or
Preferred Stock will be passed on for the underwriters by Kramer Levin Naftalis
& Frankel LLP, New York, New York. Cadwalader, Wickersham & Taft and Kramer
Levin Naftalis & Frankel LLP will rely on the opinion of Richards, Layton &
Finger, P.A. as to matters of Delaware law.
EXPERTS
The consolidated financial statements and the related financial statement
schedules incorporated in this Prospectus by reference from the Company's 1998
Annual Report on Form 10-K have been audited by Deloitte & Touche LLP,
independent auditors, as stated in their reports, which are incorporated herein
by reference, and have been so incorporated in reliance upon the reports of such
firm given upon their authority as experts in accounting and auditing.
48
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth all expenses in connection with the issuance
and distribution of the securities being registered. All amounts shown are
estimated, except the SEC registration fee and the NASD filing fee.
Registration fee under the Securities Act of 1933, as amended. $ 208,500
NASD filing fee............................................... 30,500
Blue Sky fees and expenses (including counsel fees)........... 15,000
Fees of rating agencies....................................... *
Trustees' fee and expenses.................................... 25,000
Printing and engraving........................................ 60,000
Accounting services........................................... 20,000
Legal fees of Registrants' counsel............................ 75,000
Miscellaneous................................................. *
--------
Total............................................. $ *
=========
- ----------------------
* To be completed by amendment.
Item 15. Indemnification of Directors and Officers.
Reference is made to Section 145 of the Delaware General Corporation Law
which provides for indemnification of directors and officers in certain
circumstances.
Article VIII of the Company's Restated Certificate of Incorporation
provides for indemnification of directors and officers of the Company against
certain liabilities incurred as a result of their duties as such and also
provides for the elimination of the monetary liability of directors for certain
actions as such. The Company's Restated Certificate of Incorporation, as
amended, is filed as Exhibit 4(a)(1) to the Registration Statement on Form S-3
(No. 333-57083) filed June 17, 1998.
The registrant has in effect reimbursement insurance for directors' and
officers' liability claims and directors' and officers' liability insurance
indemnifying, respectively, the registrant and its directors and officers within
specific limits for certain liabilities incurred by them, subject to the
conditions and exclusions and deductible provisions of the policies.
Under the applicable Trust Agreement, the Company will agree to indemnify
each of the Trustees of the Trust or any predecessor Trustee of the Trust, and
to hold the Trustees harmless against, any loss, damage, claims, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the applicable Trust
Agreement, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties under the applicable Trust Agreement.
Item 16. Exhibits
Exhibit No. Description
- ----------- -----------
4.1 --Restated Certificate of Incorporation of The Bear Stearns Companies
Inc. (incorporated by reference to Exhibit 4(a)(1) to the Registration
Statement of Form S-3 (File No. 333-57083)).
II-1
<PAGE>
4.2.1 --Certificate of Stock Designation relating to the Registrant's
Adjustable Rate Cumulative Preferred Stock, Series A (incorporated by
reference to Exhibit 4(a)(6) to the Registration Statement on Form S-8
(File No. 33-49979).
4.2.2 --Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series E (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on January
14, 1998).
4.2.3 --Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series F (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on April
20, 1998)
4.2.4 --Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series G (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on June
18, 1998)
4.2.5 --Form of Deposit Agreement (incorporated by reference to Exhibit 4(d)
to the Registration Statement on Form S-3 (File No. 33-59140))
4.2.6 --Specimen Depositary Receipt (included in Exhibit 4.2.5)
4.3 --Form of Indenture, to be entered into between the Company and The
Chase Manhattan Bank, as Debenture Trustee.
4.4 --Form of Supplemental Indenture, to be entered into between the Company
and The Chase Manhattan Bank, as Debenture Trustee.
4.5 --Certificate of Trust of Bear Stearns Capital Trust II.
4.6 --Certificate of Trust of Bear Stearns Capital Trust III.
4.7 --Certificate of Trust of Bear Stearns Capital Trust IV.
4.8 --Certificate of Trust of Bear Stearns Capital Trust V.
4.9 --Form of Amended and Restated Trust Agreement for each of Bear Stearns
Capital Trust II, Bear Stearns Capital Trust III, Bear Stearns Capital
Trust IV and Bear Stearns Capital Trust V among The Bear Stearns
Companies Inc., as Depositor, The Chase Manhattan Bank, as Property
Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee, and the
Administrators named therein.
4.10 --Form of Preferred Security Certificate for each of Bear Stearns
Capital Trust II, Bear Stearns Capital Trust III, Bear Stearns Capital
Trust IV and Bear Stearns Capital Trust V (included in Exhibit 4.8).
4.11 --Form of Guarantee Agreement for each of Bear Stearns Capital Trust II,
Bear Stearns Capital Trust III, Bear Stearns Capital Trust IV and Bear
Stearns Capital Trust V between The Bear Stearns Companies Inc., as
Guarantor, and The Chase Manhattan Bank, as Trustee.
5.1 --Opinion of Cadwalader, Wickersham & Taft as to legality of Junior
Subordinated Deferrable Interest Debentures, Guarantees and Preferred
Stock to be issued by The Bear Stearns Companies Inc.
5.2 --Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust II.
5.3 --Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust III.
5.4 --Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust IV.
5.5 --Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust V.
12.1 --Statement re: computation of ratio of earnings to fixed charges
(incorporated by reference to the Annual Report on Form 10-K for the
fiscal year ended June 30, 1998 (File No. 1-8989)).
23.1 --Consent of Deloitte & Touche LLP.
23.2 --Consent of Cadwalader, Wickersham & Taft (included in Exhibit 5.1).
23.3 --Consent of Richards, Layton & Finger, P.A. (included in Exhibits 5.2,
5.3, 5.4 and 5.5).
24.1 --Powers of Attorney (included on the signature page of the Registration
Statement).
25.1 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Indenture.
25.2 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust II.
25.3 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust
III.
II-2
<PAGE>
25.4 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust IV.
25.5 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust V.
25.6 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of Preferred
Securities of Bear Stearns Capital Trust II.
25.7 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of Preferred
Securities of Bear Stearns Capital Trust III.
25.8 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of Preferred
Securities of Bear Stearns Capital Trust IV.
25.9 --Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of Preferred
Securities of Bear Stearns Capital Trust V.
Item 17. Undertakings
Each of the undersigned Registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, 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 Act of 1934) that is incorporated by reference in the registration
statement will be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
will 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
registrant pursuant to the foregoing 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. If the a claim for indemnification against such
liabilities (other than the payment by each registrant of expenses incurred or
paid by a director, officer or 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.
Each of the undersigned registrants hereby also undertakes:
(1) to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereto) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
II-3
<PAGE>
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement.
(2) that, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment will be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time will be deemed to be the initial bona
fide offering thereof.
(3) to remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) that, 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 the
form of prospectus filed by the registrants pursuant to Rule 424(b)(1) or (4) or
487(h) under the Securities Act will be deemed to be part of this registration
statement as of the time it was declared effective
(5) that, for purposes of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
will be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time will be deemed
to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of the
registrants 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 New York, State of New York, on November 5,
1998.
THE BEAR STEARNS COMPANIES INC.
By: /s/ William J. Montgoris
-----------------------------------------------
William J. Montgoris
Chief Operating Officer
BEAR STEARNS CAPITAL TRUST II
By: The Bear Stearns Companies Inc., as Depositor
By: /s/ William J. Montgoris
----------------------------------------
William J. Montgoris
Chief Operating Officer
BEAR STEARNS CAPITAL TRUST III
By: The Bear Stearns Companies Inc., as Depositor
By: /s/ William J. Montgoris
----------------------------------------
William J. Montgoris
Chief Operating Officer
BEAR STEARNS CAPITAL TRUST IV
By: The Bear Stearns Companies Inc., as Depositor
By: /s/ William J. Montgoris
----------------------------------------
William J. Montgoris
Chief Operating Officer
BEAR STEARNS CAPITAL TRUST V
By: The Bear Stearns Companies Inc., as Depositor
By: /s/ William J. Montgoris
----------------------------------------
William J. Montgoris
Chief Operating Officer
II-5
<PAGE>
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Alan C. Greenberg, James E. Cayne and William J.
Montgoris and each of them, his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform such and every act and thing requisite and necessary to be done, as
fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on November 5, 1998.
<TABLE>
<CAPTION>
Signature Title
- -------------------------------------- -------------------------------------------------
THE BEAR STEARNS COMPANIES INC.
<S> <C>
/s/ Alan C. Greenberg Chairman of the Board and Director
- ---------------------------------------
Alan C. Greenberg
/s/ James E. Cayne President, Chief Executive Officer and Director
- --------------------------------------- (Principal Executive Officer)
James E. Cayne
/s/ Carl D. Glickman Director
- ---------------------------------------
Carl D. Glickman
/s/ Donald J. Harrington Director
- ---------------------------------------
Donald J. Harrington
/s/ Director
- ---------------------------------------
William L. Mack
/s/ Frank T. Nickell Director
- ---------------------------------------
Frank T. Nickell
/s/ Frederic V. Salerno Director
- ---------------------------------------
Frederic V. Salerno
/s/ Vincent Tese Director
- ---------------------------------------
Vincent Tese
/s/ Director
- ---------------------------------------
Fred Wilpon
/s/ Samuel L. Molinaro Jr. Senior Vice President and Chief Financial Officer
- --------------------------------------- (Principal Accounting Officer)
Samuel L. Molinaro Jr.
/s/ Marshall J Levinson Controller and Assistant Secretary
- --------------------------------------- (Principal Accounting Officer)
Marshall J Levinson
</TABLE>
II-6
<PAGE>
INDEX TO EXHIBITS
Exhibit
No. Description
- ------- -----------
4.1 -- Restated Certificate of Incorporation of The Bear Stearns Companies
Inc. (incorporated by reference to Exhibit 4(a)(1) to the
Registration Statement of Form S-3 (File No. 333-57083)).
4.2.1 -- Certificate of Stock Designation relating to the Registrant's
Adjustable Rate Cumulative Preferred Stock, Series A (incorporated
by reference to Exhibit 4(a)(6) to the Registration Statement on
Form S-8 (File No. 33-49979).
4.2.2 -- Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series E (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on
January 14, 1998).
4.2.3 -- Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series F (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on April
20, 1998)
4.2.4 -- Certificate of Stock Designation relating to the Registrant's
Cumulative Preferred Stock, Series G (incorporated by reference to
Exhibit 1.4 to the Registration Statement on Form 8-A filed on June
18, 1998)
4.2.5 -- Form of Deposit Agreement (incorporated by reference to Exhibit 4(d)
to the Registration Statement on Form S-3 (File No. 33-59140))
4.2.6 -- Specimen Depositary Receipt (included in Exhibit 4.2.5)
4.3 -- Form of Indenture, to be entered into between the Company and The
Chase Manhattan Bank, as Debenture Trustee.
4.4 -- Form of Supplemental Indenture, to be entered into between the
Company and The Chase Manhattan Bank, as Debenture Trustee.
4.5 -- Certificate of Trust of Bear Stearns Capital Trust II.
4.6 -- Certificate of Trust of Bear Stearns Capital Trust III.
4.7 -- Certificate of Trust of Bear Stearns Capital Trust IV.
4.8 -- Certificate of Trust of Bear Stearns Capital Trust V.
4.9 -- Form of Amended and Restated Trust Agreement for each of Bear
Stearns Capital Trust II, Bear Stearns Capital Trust III, Bear
Stearns Capital Trust IV and Bear Stearns Capital Trust V among The
Bear Stearns Companies Inc., as Depositor, The Chase Manhattan Bank,
as Property Trustee, Chase Manhattan Bank Delaware, as Delaware
Trustee, and the Administrators named therein.
4.10 -- Form of Preferred Security Certificate for each of Bear Stearns
Capital Trust II, Bear Stearns Capital Trust III, Bear Stearns
Capital Trust IV and Bear Stearns Capital Trust V (included in
Exhibit 4.8).
4.11 -- Form of Guarantee Agreement for each of Bear Stearns Capital Trust
II, Bear Stearns Capital Trust III, Bear Stearns Capital Trust IV
and Bear Stearns Capital Trust V between The Bear Stearns Companies
Inc., as Guarantor, and The Chase Manhattan Bank, as Trustee.
5.1 -- Opinion of Cadwalader, Wickersham & Taft as to legality of Junior
Subordinated Deferrable Interest Debentures, Guarantees and
Preferred Stock to be issued by The Bear Stearns Companies Inc.
5.2 -- Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust II.
5.3 -- Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust III.
5.4 -- Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust IV.
5.5 -- Opinion of Richards, Layton & Finger, P.A. as to legality of the
Preferred Securities to be issued by Bear Stearns Capital Trust V.
12.1 -- Statement re: computation of ratio of earnings to fixed charges
(incorporated by reference to the Annual Report on Form 10-K for the
fiscal year ended June 30, 1998 (File No. 1-8989)).
23.1 -- Consent of Deloitte & Touche LLP.
23.2 -- Consent of Cadwalader, Wickersham & Taft (included in Exhibit 5.1).
23.3 -- Consent of Richards, Layton & Finger, P.A. (included in Exhibits
5.2, 5.3, 5.4 and 5.5).
<PAGE>
24.1 -- Powers of Attorney (included on the signature page of the
Registration Statement).
25.1 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Indenture.
25.2 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust
II.
25.3 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust
III.
25.4 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust
IV.
25.5 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Trust Agreement of Bear Stearns Capital Trust
V.
25.6 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of
Preferred Securities of Bear Stearns Capital Trust II.
25.7 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of
Preferred Securities of Bear Stearns Capital Trust III.
25.8 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of
Preferred Securities of Bear Stearns Capital Trust IV.
25.9 -- Form T-1 Statement of Eligibility of The Chase Manhattan Bank to act
as trustee under the Guarantee for the benefit of holders of
Preferred Securities of Bear Stearns Capital Trust V.
-2-
================================================================================
THE BEAR STEARNS COMPANIES INC.
and
THE CHASE MANHATTAN BANK
Trustee
INDENTURE
Dated as of __________, _____
JUNIOR SUBORDINATED DEBENTURES
================================================================================
<PAGE>
CROSS-REFERENCE TABLE
Trust Indenture Indenture
Act Section Section
--------------- -----------
310 (a)(1).................................................. 7.09
(a)(2).................................................. 7.09
(a)(3).................................................. Not Applicable
(a)(4).................................................. Not Applicable
(b)..................................................... 7.08, 7.10
(c)..................................................... Not Applicable
311 (a)..................................................... 7.13(a)
(b)..................................................... 7.13(b)
(c)..................................................... Not Applicable
312 (a)..................................................... 5.01, 5.02(a)
(b)..................................................... 5.02(b)
(c)..................................................... 5.02(c)
313 (a)..................................................... 5.04(a)
(b)(1).................................................. Not Applicable
(b)(2).................................................. 5.04(b)
(c)..................................................... 5.04(c)
(d)..................................................... 5.04(d)
314 (a)(1).................................................. 5.03(a)
(a)(2).................................................. 5.03(b)
(a)(3).................................................. 5.03(c)
(a)(4).................................................. 4.06
(b)..................................................... Not Applicable
(c)(1).................................................. 4.06
(c)(2).................................................. 4.05
(c)(3).................................................. Not Applicable
(d)..................................................... Not Applicable
(e)..................................................... 4.05
(f)..................................................... Omitted
315 (a)..................................................... 7.01
(b)..................................................... 6.07, 7.01(b)
(c)..................................................... 7.01
(d)..................................................... 7.01
(e)..................................................... 6.08
316 (a)(1).................................................. 6.06, 8.04
(a)(2).................................................. Omitted
(b)..................................................... 6.04
(c)..................................................... 10.05
317 (a)..................................................... 6.02
(b)..................................................... 4.04
318 (a)..................................................... 15.06
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Terms Defined........................................2
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF TRANSFER AND
EXCHANGE OF SECURITIES
SECTION 2.01. Amount, Series and Delivery of Securities....................10
SECTION 2.02. Form of Securities and Trustee's Certificate.................14
SECTION 2.03. Denominations of and Payment of Interest on Securities.......16
SECTION 2.04. Execution of Securities......................................17
SECTION 2.06. Temporary Securities.........................................19
SECTION 2.07. Mutilated, Destroyed, Lost or Stolen Securities..............20
SECTION 2.08. Cancellation and Destruction of Surrendered Securities.......21
SECTION 2.09. Authenticating Agents........................................21
SECTION 2.10. Deferrals of Interest Payment Dates..........................22
SECTION 2.11. Right of Set-Off.............................................24
SECTION 2.12. Shortening or Extension of Stated Maturity...................24
SECTION 2.13. Agreed Tax Treatment.........................................24
ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.01. Applicability of Article.....................................25
SECTION 3.02. Mailing of Notice of Redemption..............................25
SECTION 3.03. When Securities Called for Redemption Become Due and
Payable......................................................26
SECTION 3.04. Right of Redemption of Securities Initially Issued to a Bear
Stearns Trust................................................27
<PAGE>
ARTICLE IV
PARTICULAR COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Principal of and Interest on Securities...........28
SECTION 4.02. Maintenance of Offices or Agencies for Registration of
Transfer, Exchange and Payment of Securities.................28
SECTION 4.03. Appointment to Fill a Vacancy in the Office of Trustee.......28
SECTION 4.04. Duties of Paying Agent.......................................29
SECTION 4.05. Further Assurances...........................................30
SECTION 4.06. Officers' Certificate as to Defaults; Notices of Certain
Defaults.....................................................30
SECTION 4.07. Waiver of Covenants..........................................30
SECTION 4.08. Additional Sums..............................................30
SECTION 4.09. Additional Covenants.........................................31
ARTICLE V
SECURITYHOLDERS LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE
SECTION 5.01. Company to Furnish Trustee Information as to the Names and
Addresses of Securityholders ................................32
SECTION 5.02. Trustee to Preserve Information as to the Names and
Addresses of Securityholders Received by It .................33
SECTION 5.03. Annual and Other Reports to Be Filed by Company with
Trustee .....................................................34
SECTION 5.04. Trustee to Transmit Annual Report to Securityholders.........35
ARTICLE VI
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default Defined....................................36
SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on
Securities or Default in Payment of Interest or Principal ...39
SECTION 6.03. Application of Moneys Collected by Trustee...................41
SECTION 6.04. Limitation on Suits by Holders of Securities.................41
SECTION 6.05. On Default Trustee May Take Appropriate Action...............42
SECTION 6.06. Rights of Holders of Majority in Principal Amount of
Securities to Direct Trustee and to Waive Default ...........43
SECTION 6.07. Trustee to Give Notice of Defaults Known to It, but May
Withhold in Certain Circumstances ...........................44
SECTION 6.08. Requirement of an Undertaking to Pay Costs in Certain
Suits under the Indenture or against the Trustee ............44
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ARTICLE VII
CONCERNING THE TRUSTEE
SECTION 7.01. Upon Event of Default Occurring and Continuing, Trustee
Shall Exercise Powers Vested in It, and Use Same Degree
of Care and Skill in Their Exercise, as a Prudent Man
Would Use....................................................45
SECTION 7.02. Reliance on Documents, Opinions, Etc.........................46
SECTION 7.03. Trustee Not Liable for Recitals in Indenture or in
Securities ..................................................47
SECTION 7.04. May Own Securities...........................................47
SECTION 7.05. Moneys Received by Trustee to Be Held in Trust without
Interest ....................................................47
SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and
Indemnity ...................................................47
SECTION 7.07. Right of Trustee to Rely on Officers' Certificate Where
No Other Evidence Specifically Prescribed ...................48
SECTION 7.08. Disqualification; Conflicting Interests......................48
SECTION 7.09. Requirements for Eligibility of Trustee......................49
SECTION 7.10. Resignation of Trustee.......................................49
SECTION 7.11. Acceptance by Successor Trustee..............................50
SECTION 7.12. Successor to Trustee by Merger, Consolidation or
Succession to Business ......................................52
SECTION 7.13. Limitations on Rights of Trustee as a Creditor to Obtain
Payment of Certain Claims within Three Months Prior to
Default or During Default, or to Realize on Property as
such Creditor Thereafter.....................................52
ARTICLE VIII
CONCERNING THE SECURITYHOLDERS
SECTION 8.01. Evidence of Action by Securityholders........................56
SECTION 8.02. Proof of Execution of Instruments and of Holding of
Securities ..................................................56
SECTION 8.03. Who May be Deemed Owners of Securities.......................57
SECTION 8.04. Securities Owned by Company or Controlled or Controlling
Persons Disregarded for Certain Purposes ....................57
SECTION 8.05. Instruments Executed by Securityholders Bind Future
Holders .....................................................58
ARTICLE IX
SECURITYHOLDERS' MEETINGS
SECTION 9.01. Purposes for which Meeting May Be Called.....................58
SECTION 9.02. Manner of Calling Meetings...................................59
SECTION 9.03. Call of Meeting by Company or Securityholders................59
SECTION 9.04. Who May Attend and Vote at Meetings..........................59
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SECTION 9.05. Regulations May Be Made by Trustee...........................59
SECTION 9.06. Manner of Voting at Meetings and Record to be Kept...........60
SECTION 9.07. Exercise of Rights of Trustee, Securityholders and Holders
of Preferred Securities Not to Be Hindered or Delayed .......61
ARTICLE X
SUPPLEMENTAL INDENTURES
SECTION 10.01. Purposes for Which Supplemental Indentures May Be Entered
into without Consent of Securityholders .....................61
SECTION 10.02. Modification of Indenture with Consent of Holders of a
Majority in Principal Amount of Securities ..................63
SECTION 10.03. Effect of Supplemental Indentures............................64
SECTION 10.04. Securities May Bear Notation of Changes by Supplemental
Indentures ..................................................65
SECTION 10.05. Revocation and Effect of Consents............................65
ARTICLE XI
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 11.01. Company May Consolidate, Etc., on Certain Terms..............66
SECTION 11.02. Successor Corporation Substituted............................66
SECTION 11.03. Opinion of Counsel to Trustee................................67
ARTICLE XII
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS
SECTION 12.01. Satisfaction and Discharge of Indenture......................67
SECTION 12.02. Application by Trustee of Funds Deposited for Payment of
Securities ..................................................68
SECTION 12.03. Repayment of Moneys Held by Paying Agent.....................68
SECTION 12.04. Repayment of Moneys Held by Trustee..........................68
ARTICLE XIII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS,
DIRECTORS AND EMPLOYEES
SECTION 13.01. Incorporators, Stockholders, Officers, Directors and
Employees of Company Exempt from Individual Liability .......68
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ARTICLE XIV
SUBORDINATION OF SECURITIES
SECTION 14.01. Agreement to Subordinate.....................................69
SECTION 14.02. Obligation of the Company Unconditional......................71
SECTION 14.03. Limitations on Duties to Holders of Senior Indebtedness
of the Company ..............................................71
SECTION 14.04. Notice to Trustee of Facts Prohibiting Payment...............71
SECTION 14.05. Application by Trustee of Moneys Deposited with It...........72
SECTION 14.06. Subrogation..................................................72
SECTION 14.07. Subordination Rights Not Impaired by Acts or Omissions
of Company or Holders of Senior Indebtedness of the
Company .....................................................72
SECTION 14.08. Authorization of Trustee to Effectuate Subordination
of Securities ...............................................73
SECTION 14.09. No Payment when Senior Indebtedness in Default...............73
SECTION 14.10. Right of Trustee to Hold Senior Indebtedness of the
Company .....................................................73
SECTION 14.11. Article XIV Not to Prevent Defaults..........................74
ARTICLE XV
CONVERSION OF SECURITIES
SECTION 15.01. Applicability of Article.....................................74
SECTION 15.02. Conversion Privilege.........................................74
SECTION 15.03. Exercise of Conversion Privilege.............................74
SECTION 15.04. Fractional Interests.........................................75
SECTION 15.05. Conversion Price.............................................76
SECTION 15.06. Adjustment of Conversion Price...............................76
SECTION 15.07. Continuation of Conversion Privilege in Case of
Reclassification, Change, Merger, Consolidation or
Sale of Assets ..............................................79
SECTION 15.08. Notice of Certain Events.....................................80
SECTION 15.09. Taxes on Conversion..........................................81
SECTION 15.10. Company to Provide Stock.....................................81
SECTION 15.11. Disclaimer of Responsibility for Certain Matters.............82
SECTION 15.12. Return of Funds Deposited for Redemption of Converted
Securities ..................................................82
ARTICLE XVI
MISCELLANEOUS PROVISIONS
SECTION 16.01. Successors and Assigns of Company Bound by Indenture.........82
SECTION 16.02. Acts of Board, Committee or Officer of Successor
Corporation Valid ...........................................82
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SECTION 16.03. Required Notices or Demands May Be Served by Mail............83
SECTION 16.04. Officers' Certificate and Opinion of Counsel to Be
Furnished upon Applications or Demands by the Company .......83
SECTION 16.05. Payments Due on Saturdays, Sundays, and Holidays.............84
SECTION 16.06. Provisions Required by Trust Indenture Act of 1939 to
Control .....................................................84
SECTION 16.07. Indenture and Securities to be Construed in Accordance
with the Laws of the State of New York ......................84
SECTION 16.08. Provisions of the Indenture and Securities for the Sole
Benefit of the Parties and the Securityholders ..............85
SECTION 16.09. Indenture May be Executed in Counterparts....................85
SECTION 16.10. Securities in Foreign Currencies.............................85
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THIS INDENTURE, dated as of the __th day of ________, ____ between THE BEAR
STEARNS COMPANIES INC., a corporation duly organized and existing under the laws
of the State of Delaware (hereinafter sometimes referred to as the "Company"),
party of the first part, and THE CHASE MANHATTAN BANK, a banking corporation
duly organized and existing under the laws of the State of New York (hereinafter
sometimes referred to as the "Trustee"), party of the second part,
W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly authorized
the issuance from time to time of its unsecured subordinated debentures or other
evidences of indebtedness (hereinafter referred to as the "Securities"), without
limit as to principal amount, issuable in one or more series, the amount and
terms of each such series to be determined as hereinafter provided, including,
without limitation, Securities issued to evidence loans made to the Company of
the proceeds from the issuance from time to time by one or more business trusts
(each a "Bear Stearns Trust" and collectively, the "Bear Stearns Trusts" or the
"Trusts") of preferred interests in such Trusts (the "Preferred Securities"
which may also be referred to, without limitation, as the "Capital Securities")
and common interests in such Trusts (the "Common Securities," and collectively
with the Preferred Securities, the "Trust Securities"); to be authenticated by
the certificate of the Trustee; and, to provide the terms and conditions upon
which the Securities are to be authenticated, issued and delivered, the Company
has duly authorized the execution of this Indenture; and
WHEREAS, all acts and things necessary to make the Securities when executed
by the Company and authenticated and delivered by the Trustee as in this
Indenture provided, the valid, binding and legal obligations of the Company, and
to constitute these presents a valid indenture and agreement according to its
terms, have been done and performed and the execution of this Indenture and the
issue hereunder of the Securities have in all respects been duly authorized, and
the Company, in the exercise of the legal rights and power vested in it,
executes this Indenture and proposes to make, execute, issue and deliver the
Securities;
NOW, THEREFORE, in order to declare the terms and conditions upon which the
Securities are authenticated, issued and delivered, and in consideration of the
premises and of the purchase and acceptance 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 or of series thereof, as follows:
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Terms Defined.
For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(a) The terms defined in this Article have the meanings assigned to them in
this Article, and include the plural as well as the singular;
(b) All other terms used herein which are defined in the Trust Indenture
Act of 1939, as amended, either directly or by reference therein, have the
meanings assigned to them therein;
(c) All accounting terms used herein and not expressly defined herein shall
have the meanings assigned to them in accordance with generally accepted
accounting principles, and the term "generally accepted accounting principles"
with respect to any computation required or permitted hereunder shall mean such
accounting principles which are generally accepted at the date or time of such
computation; and
(d) The terms "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.
"Additional Interest" shall mean the interest, if any, that shall accrue on
any interest on the Securities of any series the payment of which has not been
made on the applicable interest payment date and which shall accrue at the rate
per annum specified or determined as specified in such Security.
"Additional Sums" shall have the meaning specified in Section 4.08.
"Administrator" shall mean, in respect of any Bear Stearns Trust each
Person identified as an "Administrator" in the related Trust Agreement, solely
in such Person's capacity as Administrator of such Bear Stearns Trust under such
Trust Agreement and not in such Person's individual capacity, or any successor
administrative trustee appointed as therein provided.
"Authenticating Agent" shall mean any Authenticating Agent appointed by the
Trustee pursuant to Section 2.09.
"Authorized Newspaper" shall mean a newspaper in the Borough of Manhattan,
The City of New York, State of New York, each of which is printed in the English
language and customarily published at least once a day for at least five days in
each calendar week and of general circulation in such city. Whenever successive
publications are required to be made in an Authorized Newspaper, the successive
publications may be made in the same or in a
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different newspaper meeting the foregoing requirements and in each case on any
day of the week. If it is impossible or, in the opinion of the Trustee,
impracticable to publish any notice in the manner herein provided, then such
publication in lieu thereof as shall be made with the approval of the Trustee
shall constitute a sufficient publication of such notice.
"Bear Stearns Guarantee" shall mean the guarantee by the Company of
distributions on the Preferred Securities of a Bear Stearns Trust to the extent
provided in the applicable Guarantee Agreement.
"Bear Stearns Trust" shall mean a Delaware business trust, or any similar
trust created for the purpose of issuing Preferred Securities in connection with
the issuance of Securities under this Indenture of which the Company is the
sponsor.
"Board of Directors," when used with reference to the Company, shall mean
the Board of Directors of the Company or the Executive Committee or any other
committee of or created by the Board of Directors of the Company duly authorized
to act hereunder.
"Business Day" shall mean any day which is not a Saturday or Sunday and
which in the City of New York is neither a legal holiday nor a day on which
banking institutions are authorized by law or executive order to close or a day
on which the corporate trust office of the Trustee is closed for business.
"Capital Stock" shall mean shares of capital stock of any class of any
corporation whether now or hereafter authorized regardless of whether such
capital stock shall be limited to a fixed sum or percentage in respect of the
rights of the holders thereof to participate in dividends and in the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up.
"Commission" shall mean the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act of 1939, then the body performing such duties on such
date.
"Common Stock" shall mean the common stock, par value $1.00 per share, of
the Company.
"Company" shall mean The Bear Stearns Companies Inc., a corporation duly
organized and existing under the laws of the State of Delaware and, subject to
the provisions of Article XI, shall also include its successors and assigns.
"Compounded Interest" shall mean with respect to any series of Securities
any interest designated as Compounded Interest with respect to the Securities of
such series as contemplated by Section 2.01.
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"Depositary" shall mean, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more global
Securities, the person designated as Depositary by the Company pursuant to
Section 2.01 until a successor Depositary shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter the term "Depositary"
shall mean or include each person who is then a Depositary hereunder and if at
any time there is more than one such person, the term "Depositary" as used with
respect to the Securities of any series shall mean the Depositary with respect
to the Securities of such series.
"Distributions," with respect to the Trust Securities issued by a Bear
Stearns Trust shall mean amounts payable in respect of such Trust Securities as
provided in the related Trust Agreement and referred to therein as
"Distributions."
"Event of Default" with respect to Securities of any series shall mean any
event specified as such in Section 6.01 and any other event as may be
established with respect to the Securities of such series as contemplated by
Section 2.01.
"Existing Indenture" shall mean the Indenture, dated as of January 29,
1997, between the Company and The Chase Manhattan Bank, as trustee, as amended
or supplemented from time to time.
"Extension Period" has the meaning specified in Section 2.10.
"Guarantee Agreement" shall mean the guarantee agreement executed by the
Company of distributions on the Preferred Securities of a Bear Stearns Trust to
the extent provided in any Bear Stearns Guarantee.
"Indenture" shall mean this instrument as originally executed, or, if
amended or supplemented as herein provided, then as so amended or supplemented,
and shall include the form and terms of particular series of Securities
established as contemplated by Sections 2.01 and 2.02.
"Indebtedness" or "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) every obligation of such person for claims in
respect of derivative products such as interest and foreign exchange rate
contracts, commodity contracts and similar arrangements; and (vii) and 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.
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"Investment Company Event" shall mean the receipt by a Bear Stearns Trust
of an Opinion of Counsel (as defined in the relevant Trust Agreement)
experienced in such matters to the effect that, as a result of the occurrence of
a change in law or regulation or a change (including any announced proposed
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 such Bear Stearns Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which change or proposed change becomes effective or would become
effective, as the case may be, on or after the date of the issuance of the
Preferred Securities of such Bear Stearns Trust.
"Maturity" when used with respect to any Security shall mean the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"1940 Act" shall mean the Investment Company Act of 1940, as amended.
"Officers' Certificate" shall mean a certificate signed by the Chairman of
the Board, any Vice Chairman of the Board, the President, any Vice Chairman, any
Executive Vice President, the Chief Operating Officer or the Chief Financial
Offer of the Company (whether or not designated by a number or a word or words
added before or after the title Vice President) and by the Treasurer or an
Assistant Treasurer, Controller or the Secretary or an Assistant Secretary of
the Company and delivered to the Trustee. Each such certificate shall include
the statements provided for in Section 16.04, if and to the extent required by
the provisions thereof and will comply with Section 314 of the Trust Indenture
Act of 1939.
"Opinion of Counsel" shall mean an opinion in writing signed by legal
counsel, who shall be satisfactory to the Trustee, and who may be an employee
of, or counsel to, the Company and delivered to the Trustee. Each such opinion
shall include the statements provided for in Section 16.04, if and to the extent
required by the provisions thereof and will comply with Section 314 of the Trust
Indenture Act of 1939.
"Original Issue Date" shall mean the first date of issuance of each
Security.
"Original Issue Discount Security" shall mean any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
declaration pursuant to Section 6.01.
"Paying Agent" shall mean the Trustee or any Person authorized by the
Company to pay the principal or interest on any Securities on behalf of the
Company.
"Person" or "person" shall mean any individual, corporation, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
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"Preferred Securities" shall mean undivided beneficial interests in the
assets of a Bear Stearns Trust which rank pari passu with Common Securities
issued by such Bear Stearns Trust; provided, however, that upon the occurrence
of an Event of Default (as defined in the Trust Agreement with respect to such
Bear Stearns Trust), the rights of holders of such Common Securities to payment
in respect of distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights of holders of such Preferred
Securities.
"Preferred Securities Guarantee" shall mean, in respect of any Bear Stearns
Trust, any guarantee that the Company may enter into with The Chase Manhattan
Bank or other Persons that operates directly or indirectly for the benefit of
holders of Preferred Securities of such Bear Stearns Trust.
"Principal," wherever used with reference to the Securities or any Security
or any portion thereof, shall be deemed to include "and premium, if any."
"Property Trustee" shall mean, in respect of any Bear Stearns Trust, the
commercial bank or trust company identified as the "Property Trustee" in the
related Trust Agreement, solely in its capacity as Property Trustee of such Bear
Stearns Trust under such Trust Agreement and not in its individual capacity, or
its successor in interest in such capacity, or any successor property trustee
appointed as therein provided.
"Ranking junior to the Securities" when used with respect to any obligation
of the Company shall mean any obligation of the Company which (a) ranks junior
to and not equally with or prior to the Securities (or any other obligations of
the Company ranking on a parity with the Securities) in right of payment upon
the happening of any event of the kind specified in the first sentence of the
first paragraph of Section 14.01, and (b) is specifically designated as ranking
junior to the Securities by express provision in the instrument creating or
evidencing such obligation.
The securing of any obligations of the Company, otherwise ranking junior to
the Securities, shall be deemed to prevent such obligations from constituting
obligations ranking junior to the Securities.
"Ranking on a parity with the Securities" when used with respect to any
obligation of the Company shall mean any obligation of the Company which (a)
ranks equally with and not prior to the Securities in right of payment upon the
happening of any event of the kind specified in the first sentence of the first
paragraph of Section 14.01, including without limitation, the obligation of the
Company under the EPICs Loan Agreement (as such term is defined within the
definition of "Senior Indebtedness of the Company" below) and (b) is
specifically designated as ranking on a parity with the Securities by express
provision in the instrument creating or evidencing such obligation.
The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities, shall not be deemed to prevent such obligations from
constituting obligations ranking on a parity with the Securities.
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"Register" shall have the meaning specified in Section 2.05.
"Resolution of the Company" shall mean a resolution of the Company, in the
form of a resolution of the Board of Directors or in the form of a resolution of
senior officers of the Company pursuant to the Bylaws, authorizing, ratifying,
setting forth or otherwise validating agreements, execution and delivery of
documents, the issuance, form and terms of securities, or any other actions or
proceedings pursuant or with respect to this Indenture.
"Responsible Officer," when used with respect to the Trustee, shall mean
the Chairman and Vice Chairman of the Board of Directors, the President, the
Chairman and vice chairman of the executive committee of the Board of Directors,
every Vice President or officer senior thereto, every assistant Vice President,
the Secretary, every Assistant Secretary, the Treasurer, every assistant
Treasurer, every Corporate Trust Officer, every Assistant Corporate Trust
Officer, and every other officer and assistant officer of the Trustee
customarily performing functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of his knowledge of, and familiarity with, a
particular subject.
"Rights Plan" shall mean a plan of the Company providing for the issuance
by the Company to all holders of its Common Stock of rights entitling the
holders thereof to subscribe for or purchase shares of Common Stock or any class
or series of preferred stock, which rights (i) are deemed to be transferred with
such shares of Common Stock, (ii) are not exercisable and (iii) are also issued
in respect of future issuances of Common Stock, in each case until the
occurrence of a specified event or events.
"Security" or "Securities" shall mean any security or securities of the
Company, as the case may be, without regard to series, authenticated and
delivered under this Indenture.
"Outstanding," when used with reference to Securities, shall, subject to
the provisions of Section 8.04, mean as of any particular time, all Securities
authenticated and delivered by the Trustee under this Indenture, except
(a) Securities theretofore canceled by the Trustee 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 such Securities shall have reached their Stated
Maturity or, if such Securities are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as in Article III
provided, or provision satisfactory to the Trustee shall have been made for
giving such notice; and
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(c) Securities in lieu of or in substitution for which other Securities
shall have been authenticated and delivered or which have been paid pursuant to
the terms of Section 2.07 unless proof satisfactory to the Trustee is presented
that any such Securities are held by persons in whose hands any of such
Securities is a valid, binding and legal obligation of the Company.
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, the principal amount of an Original Issue
Discount Security that shall be deemed to be outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the maturity
thereof pursuant to Section 6.01.
"Securityholder," "holder of Securities," "registered holder" or other
similar term, shall mean any person who shall at the time be the registered
holder of any Security or Securities on the Register kept for that purpose in
accordance with the provisions of this Indenture.
"Senior Indebtedness of the Company" shall mean 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, whether incurred on or prior to the date of the
Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such obligations are not superior in right of payment to the Securities or
to other Indebtedness which is pari passu with, or subordinated to, the
Securities; provided, however, that Senior Indebtedness shall not be deemed to
include (i) any Indebtedness of the Company which when incurred and without
respect to any election under Section 1111(b) of the Federal Bankruptcy Code was
without recourse to the Company, (ii) any Indebtedness of the Company to any of
its subsidiaries, (iii) Indebtedness to any employee of the Company, (iv)
Indebtedness which by its terms is subordinated to trade accounts payable or
accrued liabilities arising in the ordinary course of business to the extent
that payments made to the holders of such Indebtedness by the holders of the
Securities as a result of the subordination provisions of the Indenture would be
greater than such payments otherwise would have been as a result of any
obligation of such holders of such Indebtedness to pay amounts over to the
obligees on such trade accounts payable or accrued liabilities arising in the
ordinary course of business as a result of subordination provisions to which
such Indebtedness is subject, and (v) any other debt securities issued pursuant
to the Indenture or the Existing Indenture. The Securities of all series will
rank pari passu with, and will not be superior in right of payment to, the
obligation of the Company under the Loan Agreement (the "EPICS Loan Agreement")
dated as of February 24, 1994, between the Company and Bear Stearns Finance LLC
("BS Finance") in the aggregate principal amount of $189,875,000 (the "EPICS
Loan") entered into in connection with the issuance by BS Finance of 6,000,000
shares of 8% Exchangeable Preferred Income Cumulative Shares ("EPICS"), Series A
(having an aggregate liquidation preference of $150,000,000).
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"Special Event" shall mean an Investment Company Event or a Tax Event.
"Special Interest" shall mean with respect to any series of Securities any
interest designated as Special Interest with respect to the Securities of such
series as contemplated by Section 2.01.
"Stated Maturity" when used with respect to any Security or any installment
of principal thereof or interest thereon shall mean the date specified pursuant
to the terms of such Security as the date on which the principal of such
Security or such installment of interest is due and payable in the case of such
principal, as such date may be shortened or extended as provided pursuant to the
terms of such Security and this Indenture.
"Subsidiary" shall mean a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For purposes of this definition, "voting stock" means stock which
ordinarily has voting power for the election of directors, whether at all times
or only so long as no senior class of stock has such voting power by reason of
any contingency.
"Tax Event" shall mean the receipt by a Bear Stearns Trust of an Opinion of
Counsel (as defined in the relevant Trust Agreement) 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 issuance of the Preferred Securities of such Bear Stearns Trust,
there is more than an insubstantial risk that (i) the Bear Stearns Trust is, or
will be within 90 days of the date of such Opinion of Counsel, subject to United
States federal income tax with respect to income received or accrued on the
corresponding series of Securities issued by the Company to such Bear Stearns
Trust, (ii) interest payable by the Company on such corresponding series of
Securities is not, or within 90 days of the date of such Opinion of Counsel,
will not be, deductible, in whole or in part, for United States federal income
tax purposes, or (iii) the Bear Stearns Trust is, or will be within 90 days of
the date of such Opinion of Counsel, subject to more than a de minimis amount of
taxes, duties or governmental charges.
"Trust Agreement" shall mean any Trust Agreement governing any Bear Stearns
Trust whether now existing or created in the future, relating to the Securities
of any series.
"Trustee" shall mean The Chase Manhattan Bank and, subject to the
provisions of Article VII, shall also include its successors. The term
"principal office" of the Trustee shall mean the corporate trust office of the
Trustee at which the corporate trust business of the Trustee shall, at any
particular time, be principally administered. The present address of the office
at which the corporate trust business of the Trustee is administered is 450 West
33rd Street, 15th Floor, New York, New York 10001.
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"Trust Indenture Act of 1939" shall mean the Trust Indenture Act of 1939,
as amended by the Trust Indenture Reform Act of 1990, as in force at the date as
of which this Indenture was originally executed.
"Trust Securities" shall mean the Common Securities and Preferred
Securities of a Bear Stearns Trust.
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF
TRANSFER AND EXCHANGE OF SECURITIES
SECTION 2.01. Amount, Series and Delivery of Securities.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. The terms of each
series (which terms shall not be inconsistent with the provisions of this
Indenture) including:
(1) The designation of the Securities of the series (which shall
distinguish the Securities of the series from all other Securities and
which shall include the word "subordinated" or a word of like meaning);
(2) Any limit upon the aggregate principal amount of the
Securities of the series which may be executed, authenticated and
delivered under this Indenture; provided, however, that nothing
contained in this Section or elsewhere in this Indenture or in the
Securities or in such resolution or in such certificate is intended to
or shall limit execution by the Company or authentication and delivery
by the Trustee of Securities under the circumstances contemplated by
Sections 2.05, 2.06, 2.07, 3.02, 3.03 and 10.04;
(3) The date or dates (if any) on which the principal of the
Securities of the series is payable;
(4) The rate or rates at which the Securities of the series shall
bear interest, if any, including Additional Sums, Additional Interest,
Compounded Interest and Special Interest, if any, the date or dates
from which such interest shall accrue, the dates on which such interest
shall be payable and the record date for the interest payable on any
interest payment date and the right to defer the payment of interest in
accordance with Section 2.10;
(5) The place or places where Securities of the series may be
presented for payment and for the other purposes provided in Section
4.02;
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(6) Any price or prices at which, any period or periods within
which, and any terms and conditions upon which Securities of the series
may be redeemed, in whole or in part, at the option of the Company;
(7) The type or types (if any) of Capital Stock of the Company
into which, any period or periods within which, and any terms and
conditions upon which Securities of the series may be made payable,
converted, exchanged in whole or in part, at the option of the holder
or of the Company;
(8) If other than denominations of $1,000 and any whole multiple
thereof, the denominations in which Securities of the series shall be
issuable;
(9) If other than the principal amount thereof, the portion of the
principal amount of Securities of the series which shall be payable
upon declaration of acceleration of the maturity thereof pursuant to
Section 6.01;
(10) If other than such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public
or private debts, the coin or currency (which may be a composite
currency) in which payment of the principal of (and premium, if any)
and interest, if any, on the Securities of that series shall be
payable;
(11) If the principal of (and premium, if any) or interest, if
any, on the Securities of that series are to be payable, at the
election of the Company or a holder thereof, in a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the period or periods within
which, and the terms and conditions upon which, such election may be
made;
(12) If the amounts of payments of principal of (and premium, if
any) or interest, if any, on the Securities of the series may be
determined with reference to an index based on a coin or currency
(including a composite currency) other than that in which the
Securities are stated to be payable, the manner in which such amounts
shall be determined;
(13) If the Securities of the series are payable at maturity or
upon earlier redemption in Capital Stock, the terms and conditions upon
which such payment shall be made;
(14) The person or persons who shall be registrar for the
Securities of the series, and the place or places where the Register of
the Securities of the series shall be kept;
(15) Any Events of Default with respect to the Securities of a
particular series, if not set forth herein;
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(16) Whether any Securities of the series are to be issuable in
global form with or without coupons, and, if so, the Depositary for
such global Securities and whether beneficial owners of interests in
any such global Security may exchange such interests for definitive
Securities of such series and of like tenor of any authorized form and
denomination and the circumstances under which, and the place or places
where, any such exchanges may occur, if other than in the manner
provided in Section 2.05;
(17) The form of Trust Agreement and Guarantee Agreement, if
applicable;
(18) If applicable, the relative degree to which Securities of the
series shall be senior to or be subordinated to other Series of such
Securities or other indebtedness of the Company in right of payment,
whether such other series of Securities or other indebtedness are
outstanding or not; and
(19) Whether the Securities of the series are to be issued
pursuant to an exemption from registration under the Securities Act;
and
(20) Any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture);
or in any case, the method for determining such terms, the persons authorized to
determine such terms and the limits, if any, within which any such determination
of such terms is to be made shall either be established in or pursuant to a
Resolution of the Company and set forth in an Officers' Certificate, or set
forth in one or more indentures supplemental hereto, prior to the issuance of
Securities of any series.
The Securities of all series shall be subordinate to Senior Indebtedness of
the Company as provided in Article XIV. The applicable Officers' Certificate or
supplemental indenture may provide that Securities of any particular series may
be issued at various times, with different dates on which the principal or any
installment of principal is payable, with different rates of interest, if any,
or different methods by which interest may be determined, with different dates
from which such interest shall accrue, with different dates on which such
interest may be payable or with any different terms other than Events of Default
but all such Securities of a particular series shall for all purposes under this
Indenture including, but not limited to, voting and Events of Default, be
treated as Securities of a single series.
If any of the terms of the series are established by action taken pursuant
to a Resolution of the Company, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate or supplemental indenture setting forth the terms of the series.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication by it, and the Trustee shall thereupon
authenticate and deliver said
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Securities to or upon the written order of the Company, signed by its Chairman
of the Board, any Vice Chairman of the Board, its President, any Vice Chairman,
any Executive Vice President, the Chief Operating Officer or the Chief Financial
Officer of the Company, and by its Treasurer or an Assistant Treasurer,
Controller or its Secretary or an Assistant Secretary, without any further
corporate action by the Company. If the form or terms of the Securities of the
series have been established in or pursuant to one or more Resolutions of the
Company and set forth in an Officers' Certificate or set forth in one or more
indentures supplemental hereto, as permitted by this Section and Section 2.02,
in authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to Section 7.01) shall be fully protected in
relying upon:
(a) an Opinion of Counsel stating:
(i) If the form or terms of such Securities have been established
by or pursuant to Resolutions of the Company as permitted by Section
2.02 and set forth in an Officers' Certificate, that such form and
terms have been established in conformity with the provisions of this
Indenture;
(ii) If the form or terms of such Securities have been established
by or pursuant to a Resolution of the Company and set forth in one or
more indentures supplemental hereto as permitted by Section 2.02, that
such form and terms have been established in conformity with the
provisions of this Indenture;
(iii) That such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute legal,
valid and binding obligations of the Company, enforceable in accordance
with their terms, entitled to the benefits of the Indenture, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting the enforcement of creditors'
rights and to general equity principles;
(iv) If the form or terms of such Securities provide for the
conversion of such Securities into shares of Capital Stock of the
Company, or the payment in Capital Stock upon maturity or earlier
redemption of the Securities, that the Company has reserved a number of
shares of Capital Stock sufficient for issuance upon such conversion or
payment, and such shares of Capital Stock are fully paid and
nonassessable; and
(v) Such other matters as the Trustee may reasonably request.
(b) An Officers' Certificate setting forth the form and terms of the
Securities of such series pursuant to Section 2.01 and Section 2.02 hereof (but
only if the form and terms of the Securities of such series are not set forth in
one or more supplemental indentures hereto) and stating that all conditions
precedent provided for in this Indenture relating to the authentication and
delivery of such Securities have been complied with, that no Event of
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Default with respect to any series of Securities has occurred and is continuing
and that the issuance of such Securities is not and will not result in (i) an
Event of Default or an event or condition which, upon the giving of notice (or
the acquisition of knowledge) or the lapse of time or both, would become an
Event of Default or (ii) a default under the provisions of any other instrument
or agreement by which the Company is bound.
The Trustee shall not be required to authenticate such Securities if the
issue of such Securities pursuant to this Indenture will affect the Trustee's
own rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the Trustee.
If all the Securities of any series are not to be issued at one time, it
shall not be necessary to deliver either an Opinion of Counsel or an Officers'
Certificate at the time of issuance of each Security, provided that such Opinion
of Counsel and Officers' Certificate, with appropriate modifications, are
instead delivered at or prior to the time of issuance of the first Security of
such series.
Each Security shall be dated the date of its authentication.
SECTION 2.02. Form of Securities and Trustee's Certificate.
The Securities of each series shall be substantially of the tenor and
purport as shall be authorized in or pursuant to a Resolution of the Company and
set forth in an Officers' Certificate or set forth in an indenture or indentures
supplemental hereto in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
or designation and such legends or endorsements thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Indenture,
or as may be required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange on which
the Securities may be listed, or to conform to usage. If the form of Securities
of any series is authorized by action taken pursuant to a Resolution of the
Company, a copy of an appropriate record of such action shall be certified by
the Secretary or an Assistant Secretary of the Company and delivered to the
Trustee at or prior to the delivery of the Officers' Certificate contemplated by
Section 2.01 setting forth the terms of the series.
The Securities may be printed, lithographed or fully or partly engraved.
The Trustee's certificate of authentication shall be in substantially the
following form:
"This is one of the Securities, of the series designated therein, referred
to in the within-mentioned Indenture.
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THE CHASE MANHATTAN BANK,
as Trustee
By _____________________________
Authorized Officer"
If Securities of a series are issuable in global form, as specified
pursuant to Section 2.01, then, notwithstanding clause (8) of Section 2.01 and
the provisions of Section 2.03, such Security shall represent such of the
outstanding Securities of such series as shall be specified therein and may
provide that it shall represent the aggregate amount of outstanding Securities
from time to time endorsed thereon and that the aggregate amount of outstanding
Securities represented thereby may from time to time be reduced to reflect
exchanges. Any endorsement of a Security in global form to reflect the amount,
or any increase or decrease in the amount, of outstanding Securities represented
thereby shall be made by the Trustee in such manner and upon instructions given
by such person or persons as shall be specified in such Security or by the
Company. Subject to the provisions of Section 2.04 and, if applicable, Section
2.06, the Trustee shall deliver and redeliver any Security in global form in the
manner and upon written instructions given by the person or persons specified in
such Security or by the Company. Any instructions by the Company with respect to
endorsement or delivery or redelivery of a Security in global form after the
original issuance of the Securities of such series shall be in writing but need
not comply with Section 16.04 and need not be accompanied by an Opinion of
Counsel.
Unless otherwise specified pursuant to Section 2.01, payment of principal
of and any premium and any interest on any Security in global form shall be made
to the person or persons specified therein.
The owners of beneficial interests in any global Security shall have no
rights under this Indenture with respect to any global Security held on their
behalf by a Depositary, and such Depositary may be treated by the Company, the
Trustee, and any agent of the Company or the Trustee as the sole holder and
owner of such global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by a Depositary, or impair, as between a
Depositary and its participants in any global Security, the operation of
customary practices governing the exercise of the rights of a holder of a
Security of any series, including, without limitation, the granting of proxies
or other authorization of participants to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action that a holder
is entitled to give or take under this Indenture.
Neither the Company, the Trustee nor any Authenticating Agent will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
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Each Depositary designated pursuant to Section 2.01 for a global Security
must, at the time of its designation and at all times while it serves as
Depositary, be a clearing agency registered under the Securities Exchange Act of
1934, as amended, and any other applicable statute or regulation.
SECTION 2.03. Denominations of and Payment of Interest on Securities.
The Securities of each series shall be issuable as fully registered
Securities without coupons in such denominations as shall be specified as
contemplated by Section 2.01. In the absence of any such provisions with respect
to the Securities of any series, the Securities of such series shall be issuable
in denominations of $1,000 and integral multiples of $1,000 in excess thereof.
If the Securities of any series shall bear interest, each Security of such
series shall bear interest from the applicable date at the rate or rates per
annum, and such interest shall be payable on the dates, specified on, or
determined in the manner provided for in, the Security. The person in whose name
any Security is registered at the close of business on any record date (as
hereinbelow defined) for the Security with respect to any interest payment date
for such Security shall be entitled to receive the interest payable thereon on
such interest payment date notwithstanding the cancellation of such Security
upon any registration of transfer, exchange or conversion thereof subsequent to
such record date and prior to such interest payment date, unless such Security
shall have been called for redemption on a date fixed for redemption subsequent
to such record date and prior to such interest payment date, or unless the
Company shall default in the payment of interest due on such interest payment
date on such Security, in which case such defaulted interest shall be paid to
the person in whose name such Security (or any Security or Securities issued
upon registration of or exchange thereof) is registered at the close of business
on the record date for the payment of such defaulted interest, or except as
otherwise specified as contemplated by Section 2.01. The term "record date" as
used in this Section with respect to any regular interest payment date for any
Security shall mean such day or days as shall be specified as contemplated by
Section 2.01; provided, however, that in the absence of any such provisions with
respect to any Security, such term shall mean: (1) the last day of the calendar
month next preceding such interest payment date if such interest payment date is
the fifteenth day of a calendar month; or (2) the fifteenth day of the calendar
month next preceding such interest payment date if such interest payment date is
the first day of a calendar month; provided, further, that (except as otherwise
specified as contemplated by Section 2.01) if the day which would be the record
date as provided herein is not a Business Day, then it shall mean the Business
Day next preceding such day. Such term, as used in this Section, with respect to
the payment of any defaulted interest on any Security shall mean (except as
otherwise specified as contemplated by Section 2.01) the fifth day next
preceding the date fixed by the Company for the payment of defaulted interest,
established by notice given by first class mail by or on behalf of the Company
to the holder of such Security not less than 10 days preceding such record date,
or, if such fifth day is not a Business Day, the Business Day next preceding
such fifth day.
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SECTION 2.04. Execution of Securities.
The Securities shall be signed on behalf of the Company, manually or in
facsimile, by its Chairman of the Board or any Vice Chairman of the Board, or
its President or any Vice Chairman or any Executive Vice President, the Chief
Operating Officer or the Chief Financial Officer of the Company and by its
Treasurer or an Assistant Treasurer, the Controller or its Secretary or an
Assistant Secretary under its corporate seal, which may be affixed thereto or
printed, engraved or otherwise reproduced thereon, by facsimile or otherwise.
Only such Securities as shall bear thereon a certificate of authentication
substantially in the form recited herein, executed by or on behalf of the
Trustee manually by an authorized officer, shall be entitled to the benefits of
this Indenture or be valid or obligatory for any purpose. Such certificate by
the Trustee upon any Security executed by the Company shall be conclusive
evidence that the Security so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture. Typographical or other errors or defects in the seal or facsimile
signature on any Security or in the text thereof shall not affect the validity
or enforceability of such Security if it has been duly authenticated and
delivered by the Trustee.
In case any officer of the Company who shall have signed any of the
Securities, manually or in facsimile, shall cease to be such officer before the
Securities so signed shall have been authenticated and delivered by the Trustee,
or disposed of by the Company, such Securities nevertheless may be authenticated
and delivered or disposed of as though the person who signed such Securities had
not ceased to be such officer of the Company; and any Security may be signed on
behalf of the Company, manually or in facsimile, by such persons as, at the
actual date of the execution of such Security, shall be the proper officers of
the Company, although at the date of the execution of this Indenture any such
person was not such officer.
SECTION 2.05. Registration, Transfer and Exchange of Securities.
Securities of any series (other than a global Security, except as set forth
below) may be exchanged for a like aggregate principal amount of Securities of
the same series of the same tenor and terms of other authorized denominations.
Securities to be exchanged shall be surrendered at the offices or agencies to be
maintained by the Company in accordance with the provisions of Section 4.02 and
the Company shall execute and the Trustee shall authenticate and deliver, or
cause to be authenticated and delivered, in exchange therefor the Security or
Securities which the Securityholder making the exchange shall be entitled to
receive.
The Company shall keep, at one of the offices or agencies to be maintained
by the Company in accordance with the provisions of Section 4.02 with respect to
the Securities of each series, a Register (herein defined as the "Register") in
which, subject to such reasonable regulations as it may prescribe, the Company
shall register the Securities of such series and the transfer of Securities of
such series as in this Article provided. Such Register shall be in written form
or in any other form capable of being converted into written form within a
reasonable time. At all reasonable times the Register shall be open for
inspection by
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the Trustee and any registrar of the Securities of such series other than the
Trustee. Upon due presentment for registration of transfer of any Security of
any series at the offices or agencies of the Company to be maintained by the
Company in accordance with Section 4.02 with respect to the Securities of such
series, the Company shall execute and register and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new
Security or Securities of the same series of like tenor and terms for a like
aggregate principal amount of authorized denominations.
Every Security issued upon registration of transfer or exchange of
Securities pursuant to this Section shall be the valid obligation of the
Company, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Security or Securities surrendered upon registration of such
transfer or exchange.
All Securities of any series presented or surrendered for exchange,
registration of transfer, redemption, conversion or payment shall, if so
required by the Company or any registrar of the Securities of such series, be
accompanied by a written instrument or instruments of transfer, in form
satisfactory to the Company and such registrar, duly executed by the registered
holder or by his attorney duly authorized in writing.
No service charge shall be made for any exchange or registration of
transfer of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto.
The Company shall not be required to exchange or register the transfer of
(a) any Securities of any series during a period beginning at the opening of
business fifteen days before the day of the mailing of a notice of redemption of
outstanding Securities of such series and ending at the close of business on the
day of such mailing, or (b) any Securities or portions thereof called or
selected for redemption, except, in the case of Securities called for redemption
in part, the portion thereof not so called for redemption.
Notwithstanding any other provision of this Section, unless and until it is
exchanged in whole or in part for Securities in definitive form, a global
Security representing all or a portion of the Securities of a series may not be
transferred, except as a whole by the Depositary for such series to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor Depositary for such series or a nominee of such successor Depositary.
Notwithstanding the foregoing, except as otherwise specified pursuant to
Section 2.01, any global Security shall be exchangeable pursuant to this Section
only as provided in this paragraph. If at any time the Depositary for the
Securities of a series notifies the Company that it is unwilling or unable to
continue as Depositary for the Securities of such series, or if at any time the
Depositary for the Securities of such series shall no longer be eligible to so
act, the Company shall appoint a successor Depositary with respect to the
Securities of such series. If (a) a successor Depositary for the Securities of
such series is not appointed by the Company within 90 days after the Company
receives such notice or becomes
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aware of such ineligibility (thereby automatically making the Company's election
pursuant to Section 2.01 no longer effective with respect to the Securities of
such series), (b) the beneficial owners of interests in a global Security are
entitled to exchange such interests for Securities of such series and of the
same tenor and terms, as specified pursuant to Section 2.01, or (c) the Company
in its sole discretion determines that the Securities of any series issued in
the form of one or more global Securities shall no longer be represented by such
global Security or Securities, then without unnecessary delay, but, if
appropriate, in any event not later than the earliest date on which such
interest may be so exchanged, the Company shall deliver to the Trustee
definitive Securities in aggregate principal amount equal to the principal
amount of such global Security, executed by the Company. On or after the
earliest date on which such interests are or may be so exchanged, such global
Security shall be surrendered by the Depositary to the Trustee, as the Company's
agent for such purpose, to be exchanged, in whole or from time to time in part,
for definitive Securities upon payment by the beneficial owners of such
interest, at the option of the Company, of a service charge for such exchange
and of a proportionate share of the cost of printing such definitive Securities,
and the Trustee shall authenticate and deliver, (a) to each person specified by
the Depositary in exchange for each portion of such global Security, an equal
aggregate principal amount of definitive Securities of the same series of
authorized denominations and of the same tenor and terms as the portion of such
global Security to be exchanged, and (b) to such Depositary a global Security in
a denomination equal to the difference, if any, between the principal amount of
the surrendered global Security and the aggregate principal amount of definitive
Securities delivered to holders thereof; provided, however, that no such
exchanges may occur during a period beginning at the opening of business 15
Business Days before any selection of Securities of that series to be redeemed
and ending on the relevant redemption date. If a Security is issued in exchange
for any portion of a global Security after the close of business at the office
or agency where such exchange occurs on (i) any record date and before the
opening of business at such office or agency on the relevant interest payment
date, or (ii) any record date for the payment of defaulted interest and before
the opening of business at such office or agency on the related proposed date
for payment of defaulted interest, then interest or default interest, as the
case may be, will not be payable on such interest payment date or proposed date
for payment of defaulted interest, as the case may be, in respect of such
Security, but will be payable on such interest payment date or proposed date for
payment of defaulted interest, as the case may be, only to the person to whom
interest in respect of such portion of such global Security is payable in
accordance with the provisions of this Indenture and such global Security.
SECTION 2.06. Temporary Securities.
Pending the preparation of definitive Securities of any series, the Company
may execute and the Trustee shall authenticate and deliver temporary Securities
of such series (printed or lithographed) of any denomination and substantially
in the form of the definitive Securities of such series, but with or without a
recital of specific redemption prices or conversion provisions and with such
omissions, insertions and variations as may be appropriate for temporary
Securities, all as may be determined by the Company. Temporary Securities may
contain such reference to any provisions of this Indenture as may be
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appropriate. Every such temporary Security shall be authenticated by the Trustee
upon the same conditions and in substantially the same manner, and with the same
effect, as the definitive Securities. Without unreasonable delay the Company
will execute and deliver to the Trustee definitive Securities of such series and
thereupon any or all temporary Securities of such series may be surrendered in
exchange therefor, at the offices or agencies to be maintained by the Company as
provided in Section 4.02 with respect to the Securities of such series, and the
Trustee shall authenticate and deliver in exchange for such temporary Securities
an equal aggregate principal amount of definitive Securities of such series.
Until so exchanged, the temporary Securities of any series shall in all respects
be entitled to the same benefits under this Indenture as definitive Securities
of such series authenticated and delivered hereunder.
SECTION 2.07. Mutilated, Destroyed, Lost or Stolen Securities.
In case any temporary or definitive Security shall become mutilated or be
destroyed, lost or stolen, the Company, in the case of any mutilated Security
shall, and in the case of any destroyed, lost or stolen Security in its
discretion may, execute, and upon its request the Trustee shall authenticate and
deliver, or cause to be authenticated and delivered, a new Security of the same
series of like tenor and terms in exchange and substitution for the mutilated
Security, or in lieu of and in substitution for the Security so destroyed, lost
or stolen. In case any such Security shall have matured or shall be about to
mature, instead of issuing a substituted Security, the Company may pay or
authorize payment of the same (without surrender thereof, except in the case of
a mutilated Security). In every case the applicant for a substituted Security or
for such payment shall furnish to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, and, in
every case of destruction, loss or theft, the applicant shall also furnish to
the Company and to the Trustee evidence to their satisfaction of the
destruction, loss or theft of such Security and of the ownership thereof. The
Trustee may authenticate any such substituted Security and deliver the same, or
the Trustee or any paying agent of the Company may make any such payment, upon
the written request or authorization of any officer of the Company. Upon the
issue of any substituted Security, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other reasonable expenses connected therewith
(including the fees and expenses of the Trustee).
To the extent permitted by mandatory provisions of law, every substituted
Security issued pursuant to the provisions of this Section in substitution for
any destroyed, lost or stolen Security shall constitute an additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be found at any time, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of the same series duly issued hereunder.
To the full extent legally enforceable, all Securities shall be held and
owned upon the express condition that the foregoing provisions are exclusive
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities and shall preclude
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any and all other rights or remedies notwithstanding any law or statute existing
or hereafter enacted to the contrary with respect to the replacement or payment
of negotiable instruments or other securities without their surrender.
SECTION 2.08. Cancellation and Destruction of Surrendered Securities.
All Securities surrendered for the purpose of payment, redemption,
conversion, exchange, substitution or registration of transfer, shall, if
surrendered to the Company or any agent of the Company or of the Trustee, be
delivered to the Trustee, and the same, together with Securities surrendered to
the Trustee for cancellation, shall be canceled by it, and no Securities shall
be issued in lieu thereof except as expressly permitted by any of the provisions
of this Indenture. The Trustee shall dispose of canceled Securities in
accordance with its customary procedures and deliver a certificate of
disposition thereof to the Company unless by an Officers' Certificate the
Company shall direct that canceled Securities be returned to it. If the Company
shall purchase or otherwise acquire any of the Securities, however, such
purchase or acquisition shall not operate as a payment, redemption or
satisfaction of the Indebtedness represented by such Securities unless and until
the Company, at its option, shall deliver or surrender the same to the Trustee
for cancellation.
SECTION 2.09. Authenticating Agents.
The Trustee may from time to time appoint one or more Authenticating Agents
with respect to one or more series of Securities, which shall be authorized to
act on behalf of the Trustee and subject to its direction in authenticating and
delivering Securities of such series pursuant hereto in connection with
exchanges, registrations of transfer, redemptions and conversions as fully to
all intents and purposes as though any such Authenticating Agent had been
expressly authorized to execute and deliver Securities of such series, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as though authenticated by
the Trustee. Wherever reference is made in this Indenture to the authentication
or delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication or
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall at all times be a corporation (including a
banking association) organized and doing business under the laws of the United
States or any State or territory thereof or of the District of Columbia, having
a combined capital and surplus of at least five million dollars, authorized
under such laws to exercise corporate trust powers and subject to supervision or
examination by federal, state, territorial, or District of Columbia authorities.
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, 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.
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Any corporation succeeding to the corporate agency business of an
Authenticating Agent shall continue to be an Authenticating Agent, if such
successor corporation is otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent or such successor corporation.
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 an 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 an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may, or at the request of the Company
promptly shall, appoint a successor Authenticating Agent. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent herein. No
successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
Any Authenticating Agent by the acceptance of its appointment shall be
deemed to have agreed with the Trustee that: it will perform and carry out the
duties of an Authenticating Agent as herein set forth, including among other
things the duties to authenticate and deliver Securities of any series for which
it has been appointed an Authenticating Agent it will furnish from time to time
as requested by the Trustee appropriate records of all transactions carried out
by it as Authenticating Agent and will furnish the Trustee such other
information and reports as the Trustee may reasonably require; it is eligible
for appointment as Authenticating Agent under this Section and will notify the
Trustee promptly if it shall cease to be so qualified; and it will indemnify the
Trustee against any loss, liability or expense incurred by the Trustee and will
defend any claim asserted against the Trustee by reason of any acts or failures
to act of the Authenticating Agent but it shall have no liability for any action
taken by it at the specific written direction of the Trustee.
SECTION 2.10. Deferrals of Interest Payment Dates.
If specified as contemplated by Section 2.01 or Section 2.02 with respect
to the Securities of a particular series, so long as no Event of Default has
occurred and is continuing, the Company shall have the right, at any time during
the term of such series, from time to time to defer the payment of interest on
such Securities for such period or periods as may be specified as contemplated
by Section 2.01 (each, an "Extension Period") during which Extension Periods the
Company shall have the right to make partial payments of interest on any
Interest Payment Date. No Extension Period shall end on a date other than an
interest payment date. At the end of any such Extension Period the Company shall
pay all interest then accrued and unpaid on the Securities (together with
Additional Sums, Additional Interest,
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Compounded Interest and Special Interest thereon, if any, at the rate specified
for the Securities of such series to the extent permitted by applicable law);
provided, however, that no Extension Period shall extend beyond the Stated
Maturity of the principal of the Securities of such series; provided, further,
that during any such Extension Period, the Company shall not, and shall not
permit any Subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any shares of the Company's capital stock (which includes
common and preferred stock), or (ii) make any payment of principal of or
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in interest to the
Securities of such series or make any guarantee payments with respect to any
Bear Stearns Guarantee or other guarantee by the Company of the debt securities
of any Subsidiary of the Company that by their terms rank pari passu with or
junior in interest to the Securities of such series (other than (a) dividends or
distributions in capital stock of the Company; (b) any declaration of a dividend
in connection with the implementation of a Rights Plan, or the issuance of
capital stock of the Company under any Rights Plan, or the redemption or
repurchase of any rights distributed pursuant to a Rights Plan; (c) payments
under any Bear Stearns Guarantee (as defined herein and in the Existing
Indenture); (d) 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; and (e) payments of interest pursuant to the EPICS Loan
Agreement). Prior to the termination of any such Extension Period, the Company
may further extend the interest payment period, provided that no Extension
Period shall exceed the period or periods specified in such Securities or extend
beyond the Stated Maturity of the principal of such Securities. Upon termination
of any Extension Period and upon the payment of all accrued and unpaid interest
and any Additional Sums, Additional Interest, Compounded Interest and Special
Interest then due on any interest payment date, the Company may elect to begin a
new Extension Period, subject to the above requirements. No interest shall be
due and payable during an Extension Period, except at the end thereof. The
Company shall give the holders of the Securities of such series and the Trustee
notice of its election to begin or extend any such Extension Period at least
five Business Days prior to the next succeeding interest payment date on which
interest on Securities of such series would be payable but for such deferral or,
with respect to the Securities of a series issued to a Bear Stearns Trust so
long as such Securities are held by such Bear Stearns Trust prior to the earlier
of (i) the next succeeding date on which Distributions on the Preferred
Securities of such Bear Stearns Trust would be payable but for such deferral, or
(ii) the date the Property Trustee of such Bear Stearns Trust is required to
give notice to any securities exchange or other applicable self-regulatory
organization or to holders of such 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.
The Trustee shall promptly give notice of the Company's election to begin
any such Extension Period to the holders of the outstanding Securities of such
series.
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SECTION 2.11. Right of Set-Off.
With respect to the Securities of a series issued to a Bear Stearns Trust
notwithstanding anything to the contrary in the Indenture, the Company shall
have the right to set-off any payment it is otherwise required to make
thereunder in respect of any such Security to the extent the Company has
theretofore made, or is concurrently on the date of such payment making, a
payment under the Bear Stearns Guarantee relating to such Security or under
Section 6.05 of the Indenture.
SECTION 2.12. Shortening or Extension of Stated Maturity.
If specified as contemplated by Section 2.01 or Section 2.02 with respect
to the Securities of a particular series, the Company shall have the right to
(i) shorten the Stated Maturity of the principal of the Securities of such
series at any time to any date not earlier than the first date on which the
Company has the right to redeem the Securities of such Series, and (ii) extend
the Stated Maturity of the principal of the Securities of such series at any
time at its election for one or more periods, but in no event to a date later
than the 49th anniversary of the first interest payment date following the
Original Issue Date of the Securities of such series; provided that, if the
Company elects to exercise its right to extend the Stated Maturity of the
principal of the Securities of such series pursuant to this clause (ii), at the
time such election is made and at the time of extension (A) the Company is not
in bankruptcy, otherwise insolvent or in liquidation, (B) the Company is not in
default in the payment of any interest or principal on such Securities, (C) in
the case of any series of Securities issued to a Bear Stearns Trust such Bear
Stearns Trust is not in arrears on payments of Distributions on the Preferred
Securities issued by such Bear Stearns Trust and no deferred Distributions are
accumulated, and (D) such Securities are rated not less than BBB- by Standard &
Poor's Ratings Services or Baa3 by Moody's Investors Service, Inc. or the
equivalent by any other nationally recognized statistical rating organization.
In the event the Company elects to shorten or extend the Stated Maturity of the
Securities, it shall give notice to the Trustee, and the Trustee shall give
notice of such shortening or extension to the holders no less than 30 and no
more than 60 days prior to the effectiveness thereof.
SECTION 2.13. Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Company and, by its
acceptance of a Security or a beneficial interest therein, the holder of, and
any Person that acquires a beneficial interest in, such Security agree that for
United States federal, state and local tax purposes it is intended that such
Security constitute indebtedness.
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ARTICLE III
REDEMPTION OF SECURITIES
SECTION 3.01. Applicability of Article.
Securities of any series which are redeemable prior to Stated Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 2.01 for Securities of any series) in
accordance with this Article.
SECTION 3.02. Mailing of Notice of Redemption.
In case the Company shall desire to exercise any right to redeem all or, as
the case may be, any part of the Securities of any series pursuant to this
Indenture, it shall give notice of such redemption to holders of the Securities
to be redeemed as hereinafter in this Section provided.
The Company covenants that it will pay to the Trustee or one or more paying
agents, on or before the Business Day next preceding the date fixed for each
redemption of Securities, a sum in cash sufficient to redeem on the redemption
date all the Securities so called for redemption at the applicable redemption
price, together with any accrued interest on the Securities to be redeemed to
the date fixed for redemption.
Notice of redemption shall be given to the holders of Securities to be
redeemed as a whole or in part by mailing by first class mail, postage prepaid,
a notice of such redemption not less than 30 nor more than 60 days prior to the
date fixed for redemption to their last addresses as they shall appear upon the
Register, but failure to give such notice by mailing in the manner herein
provided to the holder of any Security designated for redemption as a whole or
in part, or any defect therein, shall not affect the validity of the proceedings
for the redemption of any other Security.
Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the holder
receives the notice.
Each such notice of redemption shall specify the date fixed for redemption
and the redemption price at which Securities are to be redeemed or if the
redemption price cannot be calculated prior to the time the notice is required
to be given, the manner of calculation thereof, and shall state that payment of
the redemption price of the Securities or portions thereof to be redeemed will
be made at any of the offices or agencies to be maintained by the Company in
accordance with the provisions of Section 4.02 with respect to the Securities to
be redeemed, upon presentation and surrender of such Securities or portions
thereof, and that, if applicable, interest accrued to the date fixed for
redemption will be paid as specified in said notice and on and after said date
interest thereon will cease to accrue and shall also specify, if applicable, the
conversion price and the date on which the right to convert the Securities will
expire and that holders must comply with Article XV hereof in order to convert
their Securities. If less than all the Securities of any series are to be
redeemed, the notice of
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redemption to each holder shall specify such holder's Securities of such series
to be redeemed as a whole or in part. In case any Security is to be redeemed in
part only, the notice which relates to such Security shall state the portion of
the principal amount thereof to be redeemed (which shall be equal to the minimum
authorized denomination for Securities of such series or any whole multiple
thereof), and shall state that on and after the redemption date, upon surrender
of such Security, the holder will receive the redemption price in respect to the
principal amount thereof called for redemption and, without charge, a new
Security or Securities of the same series of authorized denominations for the
principal amount thereof remaining unredeemed.
In the case of any redemption at the election of the Company, the Company
shall, at least 60 days prior to the date fixed for redemption (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee of such
redemption date, the basis for such redemption and of the principal amount of
Securities of the applicable series to be redeemed. In the case of any
redemption of Securities prior to the expiration of any restriction on such
redemption provided in the terms of such Securities or that is subject to
compliance with conditions provided in the terms of such Securities, the Company
shall furnish the Trustee with an Officers' Certificate evidencing compliance
with such restriction or conditions.
If less than all the Securities of any series are to be redeemed, the
Company shall give the Trustee, at least 60 days in advance of the date fixed
for redemption, notice of the aggregate principal amount of Securities of such
series to be redeemed, and thereupon the Trustee shall select, pro rata, by lot,
or in any manner it shall deem fair, the Securities of such series to be
redeemed as a whole or in part and shall thereafter promptly notify the Company
in writing of the particular Securities of such series or portions thereof to be
redeemed. If the Securities of any series to be redeemed consist of Securities
having different dates on which the principal or any installment of principal is
payable or different rates of interest, if any, or different methods by which
interest may be determined or have any other different tenor or terms, then the
Company may, by written notice to the Trustee, direct that Securities of such
series to be redeemed shall be selected from among groups of such Securities
having specified term or terms and the Trustee shall thereafter select the
particular Securities to be redeemed in the manner set forth in the preceding
sentence from among the group of such Securities so specified.
SECTION 3.03. When Securities Called for Redemption Become Due and Payable.
If the giving of notice of redemption shall have been completed as above
provided, the Securities or portions of Securities specified in such notice
shall become due and payable on the date and at the place or places stated in
such notice at the applicable redemption price, together, if applicable, with
any interest accrued (including any Additional Sums, Additional Interest,
Compounded Interest or Special Interest) to the date fixed for redemption, and
on and after such date fixed for redemption (unless the Company shall default in
the payment of such Securities at the applicable redemption price, together with
any interest accrued to the date fixed for redemption) any interest on the
Securities or portions of
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Securities so called for redemption shall cease to accrue, and, except as
provided in Sections 7.05 and 12.04, such Securities shall cease from and after
the date fixed for redemption to be entitled to any benefit or security under
this Indenture, and the holders thereof shall have no right in respect of such
Securities except the right to receive the redemption price thereof and any
unpaid interest accrued to the date fixed for redemption. On presentation and
surrender of such Securities at said place of payment in said notice specified,
the said Securities or portions thereof shall be paid and redeemed by the
Company at the applicable redemption price, together with any interest accrued
to the date fixed for redemption; provided, however, that, except as otherwise
specified as contemplated by Section 2.01, any regular payment of interest
becoming due on the date fixed for redemption shall be payable to the holders of
the Securities registered as such on the relevant record date as provided in
Article II hereof. Upon presentation of any Security which is redeemed in part
only, the Company shall execute and the Trustee shall authenticate and deliver
at the expense of the Company a new Security of the same series of like tenor
and terms of authorized denomination in principal amount equal to the unredeemed
portion of the Security so presented; except that if a global Security is so
surrendered, the Company shall execute, and the Trustee shall authenticate and
deliver to the Depositary for such global Security, without service charge, a
global Security in a denomination equal to and in exchange for the unredeemed
portion of the principal of the global Security so surrendered.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from the
date fixed for redemption at the rate borne by or prescribed therefor in the
Security, or, in the case of a Security which does not bear interest, at the
rate of interest set forth therefor in the Security to the extent permitted by
law.
SECTION 3.04. Right of Redemption of Securities Initially Issued to a Bear
Stearns Trust.
In the case of the Securities of a series initially issued to Bear Stearns
Trust, except as otherwise specified as contemplated by Section 2.01, the
Company, at its option, may redeem such Securities on or after the date five
years after the Original Issue Date of such Securities, in whole at any time or
in part from time to time at a redemption price equal to 100% of the principal
amount thereof together with any unpaid interest accrued, (including any
Additional Sums, Additional Interest, Compounded Interest or Special Interest)
to the date fixed for redemption.
ARTICLE IV
PARTICULAR COVENANTS OF THE COMPANY
The Company covenants as follows:
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SECTION 4.01. Payment of Principal of and Interest on Securities.
The Company will duly and punctually pay or cause to be paid the principal
of and interest, if any, on each of the Securities at the time and places and in
the manner provided herein and in the Securities. Except as otherwise specified
as contemplated by Section 2.01, if the Securities of any series bear interest,
each installment of interest on the Securities of such series may at the option
of the Company be paid (i) by mailing a check or checks for such interest
payable to the person entitled thereto pursuant to Section 2.03 to the address
of such person as it appears on the Register of the Securities of such series or
(ii) by transfer to an account maintained by the Person entitled thereto as
specified in the Register of Securities, provided that proper transfer
instructions have been received by the record date.
SECTION 4.02. Maintenance of Offices or Agencies for Registration of
Transfer, Exchange and Payment of Securities.
So long as any of the Securities shall remain outstanding, the Company will
maintain an office or agency in the City of New York, State of New York, where
the Securities may be presented for registration, conversion, exchange and
registration of transfer as in this Indenture provided, and where notices and
demands to or upon the Company in respect of the Securities or of this Indenture
may be served, and where the Securities may be presented for payment. In case
the Company shall designate and maintain some office or agency other than the
previously designated office or agency, it shall give the Trustee prompt written
notice thereof. In case the Company shall fail to maintain any such office or
agency or shall fail to give such notice of the location or of any change in the
location thereof to the Trustee, presentations and demands may be made and
notices may be served at the principal office of the Trustee.
In addition to such office or agency, the Company may from time to time
constitute and appoint one or more other offices or agencies for such purposes
with respect to Securities of any series, and one or more paying agents for the
payment of Securities of any series, in such cities or in one or more other
cities, and may from time to time rescind such appointments, as the Company may
deem desirable or expedient, and as to which the Company has notified the
Trustee; provided, however, that no such appointment or rescission shall in any
manner relieve the Company of its obligation to maintain such office or agency
in the Borough of Manhattan, City of New York, where Securities of such series
may be presented for payment.
SECTION 4.03. Appointment to Fill a Vacancy in the Office of Trustee.
The Company, whenever necessary to avoid or fill a vacancy in the office of
Trustee, will appoint, in the manner provided in Section 7.10, a Trustee, so
that there shall at all times be a Trustee with respect to each series of
Securities hereunder.
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SECTION 4.04. Duties of Paying Agent.
(a) If the Company shall appoint a Paying Agent other than the Trustee with
respect to Securities of any series, 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 provisions of this Section and Section 12.03,
(1) That it will hold all sums held by it as such agent for the
payment of the principal of or interest, if any, on the Securities of
such series (whether such sums have been paid to it by the Company or
by any other obligor on the Securities of such series) in trust for the
benefit of the holders of the Securities entitled to such principal or
interest and will notify the Trustee of the receipt of sums to be so
held,
(2) That it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities of such series) to
make any payment of the principal of or interest on the Securities of
such series when the same shall be due and payable, and
(3) That it will at any time during the continuance of any Event
of Default, upon the written request of the Trustee, deliver to the
Trustee all sums so held in trust by it.
(b) Whenever the Company shall have one or more Paying Agents with respect
to the Securities of any series, it will, prior to each due date of the
principal of or any interest on a Security of such series, deposit with a Paying
Agent of such series a sum sufficient to pay the principal or interest so
becoming due, such sum to be held in trust for the benefit of the holders of
Securities entitled to such principal or interest, and (unless such Paying Agent
is the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.
(c) If the Company shall act as its own Paying Agent with respect to the
Securities of any series, it will, on or before each due date of the principal
of or any interest on a Security of such series, set aside, segregate and hold
in trust for the benefit of the holder of such Security, a sum sufficient to pay
such principal or interest so becoming due and will notify the Trustee of such
action, or any failure by it or any other obligor on the Securities of such
series to take such action and will at any time during the continuance of any
Event of Default, upon the written request of the Trustee, deliver to the
Trustee all sums so held in trust by it.
(d) Anything in this Section to the contrary notwithstanding, the Company
may, at any time, for the purpose of obtain a satisfaction and discharge of this
Indenture with respect to one or more or all series of Securities hereunder, or
for any other reason, pay or cause to be paid to the Trustee all sums held in
trust for such series by it, or any Paying Agent hereunder, as required by this
Section, such sums are to be held by the Trustee upon the trust herein
contained.
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(e) Anything in this Section to the contrary notwithstanding, the agreement
to hold sums in trust as provided in this Section is subject to the provisions
of Sections 12.03 and 12.04.
SECTION 4.05. Further Assurances.
From time to time whenever reasonably demanded by the Trustee, the Company
will make, execute and deliver or cause to be made, executed and delivered any
and all such further and other instruments and assurances and take all such
further action as may be reasonably necessary or proper to carry out the
intention of or to facilitate the performance of the terms of this Indenture or
to secure the rights and remedies hereunder of the holders of the Securities of
any series.
SECTION 4.06. Officers' Certificate as to Defaults; Notices of Certain
Defaults.
The Company will, so long as any of the Securities are outstanding, deliver
to the Trustee on or before September 15 of each year, beginning with the year
1999, a certificate signed by the Company's principal executive officer,
principal financial officer or principal accounting officer stating that a
review has been made under his or her supervision of the activities of the
Company during such year and of the performance under this Indenture and, to the
best of his or her knowledge, the Company has complied with all conditions and
covenants under this Indenture throughout such year, or if there has been a
default in the fulfillment of any such obligation, specifying each such default
known and the nature and status thereof. For purposes of this Section, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.
SECTION 4.07. Waiver of Covenants.
The Company may omit in any particular instance to comply with any covenant
or condition specifically contained in this Indenture for the benefit of one or
more series of Securities, if before the time for such compliance the holders of
a majority in principal amount of the Securities of all series affected (all
series voting as one class) at the time outstanding (determined as provided in
Section 8.04) shall waive such compliance in such instance, but no such waiver
shall extend to or affect such covenant or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such covenant or
condition shall remain in full force and effect.
SECTION 4.08. Additional Sums.
In the case of the Securities of a series issued to a Bear Stearns Trust,
so long as no Event of Default has occurred and is continuing and except as
otherwise specified as contemplated by Section 2.01 or Section 2.02, in the
event that (i) a Bear Stearns Trust is the holder of all of the Outstanding
Securities of such series, (ii) a Special Event in respect of such Bear Stearns
Trust shall have occurred and be continuing and (iii) the Company shall not have
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(a) redeemed the Securities of such series or (b) terminated such Bear Stearns
Trust pursuant to the termination provisions of the related Trust Agreement, the
Company shall pay to such Trust (and its permitted successors or assign under
the related Trust Agreement) for so long as such Bear Stearns Trust (or its
permitted successor or assignee) is the registered holder of any Securities of
such series, such additional amounts as may be necessary in order that the
amount of Distributions (including any Additional Amounts (as defined in the
Trust Agreement)), then due and payable by such Bear Stearns Trust on the
related Preferred Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of any additional taxes (the "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 2.10 or the
Securities shall not defer the payment of any Additional Sums that may be due
and payable.
SECTION 4.09. Additional Covenants.
The Company covenants and agrees with each holder of Securities of a series
issued to a Bear Stearns Trust that it will not, and it will not permit any
Subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire or make a liquidation payment with respect to,
any shares of the Company's capital stock (which includes common and preferred
stock), or (ii) make any payment of principal of or interest or premium, if any,
on or repay, repurchase or redeem any debt securities of the Company that rank
pari passu with or junior in interest to the Securities of such series or make
any guarantee payments with respect to any Bear Stearns Guarantee or other
guarantee by the Company of debt securities of any Subsidiary of the Company
that by their terms rank pari passu with or junior in interest to the Securities
of such series (other than (a) dividends or distributions in capital stock of
the Company; (b) any declaration of a dividend in connection with the
implementation of a Rights Plan, or the issuance of capital stock of the Company
under any Rights Plan, or the redemption or repurchase of any rights distributed
pursuant to a Rights Plan; (c) payments under any Bear Stearns Guarantee (as
defined herein and in the Existing Indenture); (d) purchases of common stock
related to the issuance of common stock under any of the Company's benefit plans
for its directors, officers or employees; and (e) payments of interest pursuant
to the EPICS Loan Agreement) if at such time (i) there shall have occurred any
event of which the Company has actual knowledge that (a) with the giving of
notice or the lapse of time or both, would constitute an Event of Default
hereunder and (b) in respect of which the Company shall not have taken
reasonable steps to cure, (ii) the Company shall be in default with respect to
its payment of any obligations under the related Bear Stearns Guarantee or (iii)
the Company shall have given notice of its election to begin an Extension Period
as provided herein and shall not have rescinded such notice, or such period, or
any extension thereof, shall be continuing.
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The Company also covenants with each holder of Securities of a series
issued to Bear Stearns Trust (i) to maintain directly or indirectly 100%
ownership of the Common Securities of such Bear Stearns Trust; provided,
however, that any permitted successor of the Company hereunder may succeed to
the Company's ownership of such Common Securities, (ii) not to voluntarily
terminate, wind up or liquidate such Bear Stearns Trust, except (a) in
connection with a distribution of the Securities of such series to the holders
of Preferred Securities in liquidation of such Bear Stearns Trust or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the related Trust Agreement and (iii) to use its reasonable efforts, consistent
with the terms and provisions of such Trust Agreement, to cause such Trust to
remain classified as a grantor trust and not an association taxable as a
corporation for United States federal income tax purposes.
The Company also covenants and agrees with each holder of Securities of a
series issued to a Bear Stearns Trust that it will pay all debts and other
obligations (other than with respect to the Preferred Securities) and all costs
and expenses of the Bear Stearns Trust (including costs and expenses relating to
the organization of the Bear Stearns Trust, the fees and expenses of the
trustees of such Bear Stearns Trust and the costs and expenses relating to the
operation of the Bear Stearns Trust) and the offering of the Preferred
Securities and to pay any and all taxes and all costs and expenses with respect
to the foregoing (other than United States withholding taxes) to which the Bear
Stearns Trust might become subject. The foregoing obligations of the Company are
for the benefit of, and shall be enforceable by, any person to whom any such
debts, obligations, costs, expenses and taxes are owed (a "Creditor") whether or
not such Creditor has received notice thereof. Any such Creditor may enforce
such obligations of the Company directly against the Company and the Company has
irrevocably waived any right or remedy to require that any such Creditor take
any action against the Bear Stearns Trust or any other person before proceeding
against the Company.
ARTICLE V
SECURITYHOLDERS LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE
SECTION 5.01. Company to Furnish Trustee Information as to the Names and
Addresses of Securityholders.
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee, semiannually not more than five days after January 1
and July 1 of each year beginning with January 1999, and at such other times as
the Trustee may request in writing within 30 days after receipt by the Company
of any such request, a list in such form as the Trustee may reasonably require
containing all information in the possession or control of the Company, or any
Paying Agent or any registrar of the Securities of such series, other than the
Trustee, as to the names and addresses of the holders of Securities of such
series obtained (in the case of each list other than the first list) since the
date as of which the next previous list was furnished; provided, however, that
if the Trustee shall be the registrar of the Securities of such series, no such
list need be furnished. Any such list may be dated as of a date not more
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than fifteen days prior to the time such information is furnished or caused to
be furnished, and need not include information received after such date.
SECTION 5.02. Trustee to Preserve Information as to the Names and Addresses
of Securityholders Received by It.
(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
Securities of each series (1) contained in the most recent list furnished to it
as provided in Section 5.01 and (2) received by it in the capacity of Paying
Agent or registrar (if so acting). The Trustee may destroy any list furnished to
it as provided in Section 5.01 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 of any series or with holders of all Securities with respect to their
rights under this Indenture or under such Securities, 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
(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, or
(2) inform such applicants as to the approximate number of holders
of Securities of such series or all Securities, as the case may be,
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, and as to the approximate cost of mailing to such
Securityholders the form of proxy or other communications, if any,
specified in such application.
If the Trustee shall elect not to afford such access to such information,
the Trustee shall, upon the written request of such applicants, mail to each of
the holders of Securities of such series, or all Securities, as the case may be,
whose name and address appear in the information preserved at the time by the
Trustee in accordance with the provisions of subsection (a) of this Section, a
copy of the form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interests of the holders of Securities of such series or all Securities, as the
case may be, or would be in violation of applicable law. Such written statement
shall specify the basis of such opinion. If the Commission, after opportunity
for a hearing upon the
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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 the 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 nor any registrar 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, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under said subsection (b).
(d) If there shall be different Trustees acting hereunder with respect to
separate series of Securities, applicants shall make separate applications
hereunder to each such Trustee, and such Trustees shall collaborate, if
necessary, in acting under this Section.
SECTION 5.03. Annual and Other Reports to Be Filed by Company with Trustee.
(a) The Company covenants and agrees to file with the Trustee within
fifteen days after 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 the 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 Securities Exchange Act of 1934; or, if the Company is not required to file
information, documents or reports pursuant to either of such Sections, then it
will 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 Securities Exchange Act of 1934 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 the 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 to the holders of
Securities within 30 days after the filing thereof with the Trustee, in the
manner and to the extent provided in subsection (c) of Section 5.04 with respect
to reports pursuant to subsection (a) of said Section 5.04, such summaries of
any information, documents and reports required
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to be filed by the Company pursuant to subsections (a) and (b) of this Section
as may be required by rules and regulations prescribed from time to time by the
Commission.
SECTION 5.04. Trustee to Transmit Annual Report to Securityholders.
(a) On or before January 15, 1999, and on or before January 15 in every
year thereafter, if and so long as any Securities are outstanding hereunder, the
Trustee shall transmit to the Securityholders as hereinafter in this Section
provided, a brief report dated as of the preceding November 15 with respect to
any of the following events which may have occurred within the previous twelve
(12) months (but if no such event has occurred within such period no report need
be transmitted):
(1) Any change to its eligibility under Section 7.09, and its
qualifications under Section 7.08;
(2) The creation of or any material change to a relationship
which, with the occurrence of an Event of Default, would create a
conflicting interest within the meaning of the Trust Indenture Act;
(3) The character and amount of any advances (and if the Trustee
elects so to state, the circumstances surrounding the making thereof)
made by the Trustee (as such) which remain unpaid on the date of such
report, and for the reimbursement of which it claims or may claim a
lien or charge, prior to that of the Securities of any series, on any
property or funds held or collected by it as Trustee, except that the
Trustee shall not be required (but may elect) to state such advances if
such advances so remaining unpaid aggregate not more than one-half of
one percent of the principal amount of the Securities of such series
outstanding on the date of such report;
(4) Any change to the amount, interest rate, and maturity date of
all other indebtedness owing by the Company (or by any other obligor on
the Securities) to the Trustee in its individual capacity, on the date
of such report, with a brief description of any property held as
collateral security therefor, except indebtedness based upon a creditor
relationship arising in any manner described in paragraph (2), (3),
(4), or (6) of subsection (b) of Section 7.13;
(5) Any change to the property and funds, if any, physically in
the possession of the Trustee (as such) on the date of such report;
(6) Any additional issue of Securities which the Trustee has not
previously reported; and
(7) Any action taken by the Trustee in the performance of its
duties under this Indenture which it has not previously reported and
which in its opinion materially affects the Securities, except action
in respect of a default, notice of which has been or is to be withheld
by it in accordance with the provisions of Section 6.07.
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(b) The Trustee shall transmit to the Securityholders, as hereinafter
provided, a brief report with respect to the character and amount of any
advances (and if the Trustee elects so to state, the circumstances surrounding
the making thereof) made by the Trustee (as such) since the date of the last
report transmitted pursuant to the provisions of subsection (a) of this Section
(or if such report has not yet been so transmitted, since the date of execution
of this Indenture), for the reimbursement of which it claims or may claim a lien
or charge prior to that of the Securities of any series on property or funds
held or collected by it as Trustee, and which it has not previously reported
pursuant to this subsection, except that the Trustee shall not be required (but
may elect) to report such advances if such advances remaining unpaid at any time
aggregate ten percent or less of the principal amount of Securities of such
series outstanding at such time, such report to be transmitted within 90 days
after such time.
(c) Reports pursuant to this Section shall be transmitted by mail to all
holders of Securities of any series, as the names and addresses of such holders
shall appear upon the Register of the Securities of such series.
(d) A copy of each such report shall, at the time of such transmission to
Securityholders, be filed by the Trustee with each stock exchange upon which the
Securities of any series are listed and also with the Commission. The Company
will notify the Trustee when and as the Securities of any series become listed
on any stock exchange.
ARTICLE VI
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. Events of Default Defined.
The term "Event of Default" whenever used herein with respect to Securities
of any series shall mean any one of the following events:
(a) Default in the payment of any installment of interest upon any of the
Securities of such series as and when the same shall become due and payable, and
continuance of such default for a period of 30 days (subject to the deferral of
any due date in the case of an Extension Period); or
(b) Default in the payment of all or any part of the principal of any of
the Securities of such series as and when the same shall become due and payable
either at maturity, upon any redemption, by declaration or otherwise; or
(c) Failure on the part of the Company duly to observe or perform in any
material respect any other of the covenants or agreements on the part of the
Company in the Securities or in this Indenture (including any supplemental
indenture or pursuant to any Officers' Certificate as contemplated by Section
2.01) specifically contained for the benefit of the Securities of such series,
for a period of 90 days after there has been given, by registered
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or certified mail, to the Company by the Trustee, or to the Company and the
Trustee by the holders of not less than 25% in principal amount of the
Securities of such series and all other series so benefited (all series voting
as one class) at the time outstanding under this Indenture a written notice
specifying such failure and stating that such is a "Notice of Default"
hereunder; or
(d) The commencement by the Company of a voluntary case under Chapter 7 or
Chapter 11 of the federal Bankruptcy Code or any other similar state or federal
law now or hereafter in effect, or the consent by the Company to the entry of a
decree or order for relief in an involuntary case under any such law, or the
consent by the Company to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or similar official) of
the Company or of all or substantially all of its property, or the making by the
Company of any general assignment for the benefit of creditors, or the failure
by the Company generally to pay its debts as they become due; or
(e) The entry of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Company in an involuntary case
under Chapter 7 or Chapter 11 of the federal Bankruptcy Code or any other
similar state or federal law now or hereafter in effect, or the appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of the Company or for all or substantially all of its property, or the
ordering of a winding-up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 90 days.
If an Event of Default under clauses (a), (b) or (c) above shall have
occurred and be continuing (but, in the case of clause (c), only if the Event of
Default is with respect to less than all series of Securities then outstanding
under this Indenture), unless the principal of all the Securities shall have
already become due and payable, either the Trustee or the holders of not less
than 25% in principal amount of all the then outstanding Securities of the
series as to which such Event of Default under clauses (a), (b) or (c) above has
occurred (each such series voting as a separate class in the case of an Event of
Default under clauses (a) or (b), and all such series voting as one class in the
case of an Event of Default under clause (c)), by notice in writing to the
Company (and to the Trustee if given by Securityholders) may declare the
principal amount (or if Securities of any series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of such series) of all the Securities of such series, or of all such
series in the case of an Event of Default under clause (c) above, in each case
together with any accrued interest, to be due and payable immediately, and upon
any such declaration the same shall become and shall be immediately due and
payable; provided, however, that in the case of the Securities of a series
issued to a Bear Stearns Trust, if upon an Event of Default, the Trustee or the
holders of at least 25% in principal amount of the outstanding Securities of
that series fail to declare the principal of all the Securities of that series
to be immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the corresponding series of Preferred Securities then
outstanding shall have such right by a notice in writing to the Company and the
Trustee. If an Event of Default under clauses (c), (d) or (e) above shall have
occurred and be continuing (but, in the case of clause (c), only if the Event of
Default is with respect to all Securities then
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outstanding under the Indenture), then and in each and every such case, unless
the principal of all the Securities shall have already become due and payable,
either the Trustee or the holders of not less than 25% in principal amount of
all the then outstanding Securities of each series as to which such Event of
Default under clauses (c), (d) or (e) above has occurred (voting as one class),
by notice in writing to the Company (and to the Trustee if given by
Securityholders) may declare the principal amount (or if Securities of any
series arc Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of such series) of all the Securities as
to which the Event of Default under clauses (c), (d) or (e) above has occurred,
together with any accrued interest, to be due and payable immediately, and upon
any such declaration the same shall become and shall be immediately due and
payable, anything contained in this Indenture or in the Securities to the
contrary notwithstanding; provided, however, that in the case of the Securities
of a series issued to a Bear Stearns Trust, if upon an Event of Default, the
Trustee or the holders of not less than 25% in principal amount of the
outstanding Securities of that series fail to declare the principal of all the
Securities of that series to be immediately due and payable, the holders of at
least 25% in aggregate liquidation amount of the corresponding series of
Preferred Securities then outstanding shall have such right by a notice in
writing to the Company and the Trustee. The foregoing provisions, however, are
subject to the condition that if at any time after the principal amount (or
specified portion thereof) of the Securities of any one or more series (or of
all the Securities, as the case may be) shall have been so declared due and
payable, and before any judgment or decree for the payment of moneys due shall
have been obtained or entered as hereinafter provided, the Company shall pay or
shall deposit with the Trustee a sum sufficient to pay all matured installments
of interest upon all the Securities of such series (or upon all the Securities,
as the case may be) and the principal of any and all Securities of such series
(or of any and all the Securities, as the case may be) which shall have become
due otherwise than by declaration (with interest on overdue installments of
interest to the extent permitted by law and on such principal at the rate or
rates of interest borne by, or prescribed therefor in, the Securities of each
such series to the date of such payment or deposit) and the amounts payable to
the Trustee under Section 7.06, and any and all defaults under the Indenture
with respect to Securities of such series (or all Securities, as the case may
be), other than the nonpayment of principal of and any accrued interest on
Securities of such series (or any Securities, as the case may be) which shall
have become due by declaration, shall have been cured, remedied or waived as
provided in Section 6.06, then and in every such case the holders of a majority
in principal amount of the Securities of such series (or of all the Securities,
as the case may be) then outstanding and as to which such Event of Default has
occurred (such series or all series voting as one class, if more than one series
are so entitled) by written notice to the Company and to the Trustee, may
rescind and annul such declaration and its consequences. In the case of
Securities issued to a Bear Stearns Trust, should the holders of such Securities
fail to annul such declaration and waive such default, the holders of a majority
in aggregate liquidation preference of related Preferred Securities shall have
such right; but no such rescission and annulment shall extend to or shall affect
any subsequent default, or shall impair any right consequent thereon.
In case the Trustee, any holder of Securities or any holder of Preferred
Securities shall have proceeded to enforce any right under this Indenture and
such proceedings
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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, such holder of Securities or such holder of Preferred
Securities then and in every such case the Company, the Trustee, the holders of
the Securities of such series (or of all the Securities, as the case may be) and
the holders of Preferred Securities shall be restored respectively to their
former positions and rights hereunder, and all rights, remedies and powers of
the Company and the Trustee, the holders of the Securities of such series (or of
all the Securities, as the case may be) and the holders of Preferred Securities
shall continue as though no such proceedings had been taken.
SECTION 6.02. Covenant of Company to Pay to Trustee Whole Amount Due on
Securities or Default in Payment of Interest or Principal.
The Company covenants that (1) in case default shall be made in the payment
of any installment of interest on any of the Securities of any series as and
when the same shall become due and payable, and such default shall have
continued for a period of 30 days (subject to the deferral of any due date in
the case of an Extension Period), or (2) in case default shall be made in the
payment of all or any part of the principal of any of the Securities of any
series when the same shall have become due and payable, whether upon maturity of
the Securities of such series or upon any redemption or upon 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 of such series, the
whole amount that then shall have become due and payable on all such Securities
of such series for principal or interest, or both, as the case may be, with
interest upon the overdue principal and installments of interest (to the extent
permitted by law) at the rate or rates of interest borne by or prescribed
therefor in the Securities of such series; 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 expenses or liabilities incurred, and all
advances made, by the Trustee hereunder other than through its negligence or bad
faith.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, 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 proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such
Securities, and collect in the manner provided by law out of the property of the
Company or any other obligor upon such Securities wherever situated the moneys
adjusted or decreed to be payable.
The Trustee shall be entitled and empowered, either in its own name or as
trustee of an express trust, or as attorney-in-fact for the holders of the
Securities of any series, or in any one or more of such capacities (irrespective
of whether the principal of the Securities of such series 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) to file and prove a claim or claims for the whole amount of
principal (or, if the Securities of such series are Original Issue Discount
Securities, such
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portion of the principal amount as may be specified in the terms of such series)
and interest owing and unpaid in respect of the Securities of such series and to
file such other documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for reasonable compensation of the
Trustee, its agents and counsel, and for reimbursement of all expenses,
disbursements and liabilities incurred, and all advances made, by the Trustee,
its agents and counsel, except as a result of its negligence or bad faith) and
of the holders of the Securities of such series allowed in any equity
receivership, insolvency, bankruptcy, liquidation, arrangement, readjustment,
reorganization or any other judicial proceedings relative to the Company or any
other obligor on the Securities or their creditors, or their property. The
Trustee is hereby irrevocably appointed (and the successive respective holders
of the Securities of each series by taking and holding the same shall be
conclusively deemed to have so appointed the Trustee) the true and lawful
attorney-in-fact of the respective holders of the Securities of such series,
with authority to make and file in the respective names of the holders of the
Securities of such series, or on behalf of the holders of the Securities of such
series as a class, any proof of debt, amendment of proof of debt, claim,
petition or other document in any such proceeding and to receive payment of any
sums becoming distributable on account thereof, and to execute any such other
papers and documents and to do and perform any and all such acts and things for
and on behalf of such holders of the Securities, as may be necessary or
advisable in the opinion of the Trustee in order to have the respective claims
of the Trustee and of the holders of the Securities of such series allowed in
any such proceedings, and to receive payment of or on account of such claims and
to distribute the same, and any 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 Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.06; provided,
however, that nothing herein shall be deemed to authorize the Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities of such series or the rights of any holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
holder of Securities of such series in any such proceeding.
All rights of action and of asserting claims under this Indenture, or under
any of the Securities of any series, may be enforced by the Trustee without the
possession of any of the Securities of such series, 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, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
such Trustee, its agents and counsel, for the ratable benefit of the holders of
the Securities of such series.
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SECTION 6.03. Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee pursuant to Section 6.02 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 several 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, and of all
amounts payable to the Trustee under Section 7.06;
Second: In case the principal of the outstanding Securities in respect of
which moneys have been collected shall not have become due and be unpaid, to the
payment of any interest on such Securities, in the order of the maturity of the
installments of such interest, with interest upon the overdue installments of
interest (so far as permitted by law and to the extent that such interest has
been collected by the Trustee) at the rate or rates of interest borne by, or
prescribed therefor in, such Securities, such payments to be made ratably to the
persons entitled thereto, without discrimination or preference;
Third: In case the principal of the outstanding Securities in respect of
which such moneys have been collected shall have become due, by declaration or
otherwise, to the payment of the whole amount then owing and unpaid upon such
Securities for principal and interest, if any, with interest on the overdue
principal and any installments of interest (so far as permitted by law and to
the extent that such interest has been collected by the Trustee) at the rate or
rates of interest borne by, or prescribed therefor in, such Securities; and in
case such moneys shall be insufficient to pay in full the whole amount so due
and unpaid upon such Securities, then to the payment of such principal and
interest, without preference or priority of principal over interest, or of
interest over principal, or of any installment of interest over any other
installment of interest, or of any Security over any other Security, ratably to
the aggregate of such principal and accrued and unpaid interest; and
Fourth: To the payment of the remainder, if any, to the Company, its
successors or assigns, or to whomsoever may be lawfully entitled to receive the
same, or as a court of competent jurisdiction may direct.
SECTION 6.04. Limitation on Suits by Holders of Securities.
No holder of any Security of any series shall have any right by virtue 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 default and of the continuance thereof, as hereinbefore provided, and
unless also the holders of not less than 25% in principal amount of all the
Securities at the time outstanding (considered as one class) 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
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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 neglected or refused to institute any such action, suit
or proceeding and no direction inconsistent with such written request shall have
been given to the Trustee pursuant to Section 6.06; 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 or
by availing of any provision of this Indenture to affect, disturb or prejudice
the rights of the holders of any other of such Securities, or to obtain or seek
to obtain priority over or preference to any other such holder, or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
Notwithstanding any other provisions in this Indenture, the right of any
holder of any Security to receive payment of the principal of and interest on
such Security, on or after the respective due dates expressed in such Security
(or, in the case of redemption on or after the date fixed for redemption), or to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
holder.
SECTION 6.05. On Default Trustee May Take Appropriate Action.
In case of an Event of Default hereunder 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. All
powers and remedies given by this Article to the Trustee or to the
Securityholders shall, to the extent permitted by law, be deemed cumulative and
not exclusive of any thereof or 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, and no delay or omission of the Trustee,
of any holder of any of the Securities or any holder of Preferred 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 Event of Default or an acquiescence
therein; and, subject to the provisions of Section 8.04, every power and remedy
given by this Article or by law to the Trustee, to the Securityholders or the
holders of Preferred Securities may be exercised from time to time, and as often
as shall be deemed expedient, by the Trustee, by the Securityholders or by the
holders of Preferred Securities, as the case may be.
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In the case of Securities of a series issued to a Bear Stearns Trust, any
holder of the corresponding series of Preferred Securities issued by such Bear
Stearns Trust shall have the right, upon the occurrence of an Event of Default
described in Section 6.01(a) or (b) above, to institute a suit directly against
the Company for enforcement of payment to such holder of principal of (including
premium, if any) and interest (including any Additional Sums, Additional
Interest, Compounded Interest and Special Interest, if any) on the Securities
having a principal amount equal to the aggregate liquidation amount of such
Preferred Securities of the corresponding series held by such holder.
SECTION 6.06. Rights of Holders of Majority in Principal Amount of
Securities to Direct Trustee and to Waive Default.
The holders of a majority in principal amount of the Securities of any one
or more series or of all the Securities, as the case may be (voting as one
class), at the time outstanding (determined as provided in Section 8.04) 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 with respect to such one or more series;
provided, however, that, subject to Section 7.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee being advised by
Opinion of Counsel determines that the action so directed may not lawfully be
taken, or if the Trustee in good faith shall, by a Responsible Officer or
Officers of the Trustee, determine that the proceedings so directed would be
illegal or involve it in personal liability or be unduly prejudicial to the
rights of Securityholders of such one or more series not parties to such
direction, and provided further that nothing in this Indenture shall impair the
right of the Trustee to take any action deemed proper by the Trustee and which
is not inconsistent with such direction by such Securityholders of such one or
more series. The holders of a majority in principal amount of the Securities of
all series as to which a default hereunder has occurred (all series voting as
one class) at the time outstanding (determined as provided in Section 8.04) and,
in the case of any Securities of a series issued to a Bear Stearns Trust, the
holders of a majority in aggregate liquidation amount of the Preferred
Securities issued by such Bear Stearns Trust, may waive any past default
hereunder with respect to such series and its consequences, except a default in
the payment of the principal of or interest on any of such Securities or in
respect of a covenant or provision hereof which under Article X cannot be
modified or amended without the consent of the holder of each Security so
affected. Upon any such waiver, such default shall cease to exist and any Event
of Default arising therefrom shall be deemed to have been cured for every
purpose of this Indenture, but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon. Any such waiver shall be
deemed to be on behalf of the holders of all the Securities of such series or,
in the case of a waiver by holders of Preferred Securities issued by such Bear
Stearns Trust, on behalf of all holders of Preferred Securities issued by such
Bear Stearns Trust.
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SECTION 6.07. Trustee to Give Notice of Defaults Known to It, but May
Withhold in Certain Circumstances.
The Trustee shall, within 90 days after the occurrence of any default
hereunder with respect to the Securities of any series, give to the holders of
the Securities of such series in the manner and to the extent provided in
subsection (c) of Section 5.04 with respect to reports pursuant to subsection
(a) of said Section 5.04, notice of such default known to the Trustee unless
such default shall have been cured, remedied or waived before the giving of such
notice (the term "default" for the purposes of this Section being hereby defined
to be the events specified in clauses (c), (d) and (e) of Section 6.01, default
in the payment of the principal of or interest on Securities of any series, and
any additional events specified in the terms of any series of Securities
pursuant to Section 2.01, not including any periods of grace provided for
therein, and irrespective of the giving of written notice specified in any such
terms, and irrespective of the delivery of any Officers' Certificate provided
for in any such terms); provided, that, except in the case of default in the
payment of the principal of or interest on any of the Securities of such series,
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 interest of the holders of the Securities
of such series.
SECTION 6.08. Requirement of an Undertaking to Pay Costs in Certain Suits
under the Indenture or against the Trustee.
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, including reasonable attorneys' fees, 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 shall not apply to any suit instituted by the Trustee, to any suit
instituted by any holder of Securities of any series, or group of such
Securityholders, holding in the aggregate more than ten percent in principal
amount of all the Securities (all series considered as one class) outstanding;
or to any suit instituted by any Securityholder for the enforcement of the
payment of the principal of or interest on any Security, on or after the due
date expressed in such Security (or in the case of any redemption, on or after
the date fixed for redemption).
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ARTICLE VII
CONCERNING THE TRUSTEE
SECTION 7.01. Upon Event of Default Occurring and Continuing, Trustee Shall
Exercise Powers Vested in It, and Use Same Degree of Care and Skill in Their
Exercise, as a Prudent Man Would Use.
The Trustee, prior to the occurrence of an Event of Default and after the
curing, remedying 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, remedied or waived) the Trustee shall exercise such of the rights
and powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affair.
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; provided, however, that
(a) Prior to the occurrence of an Event of Default and after the curing,
remedying or waiving of all Events of Default which may have occurred:
(1) The duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture and the Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) In the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a
duty to examine the same to determine whether or not they conform to
the requirements of this Indenture;
(b) The Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer or Officers of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts;
(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
holders of Securities pursuant to Section 6.06 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;
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(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
7.01; and
(e) 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 hereunder or in the exercise
of any of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
SECTION 7.02. Reliance on Documents, Opinions, Etc.
Except as otherwise provided in Section 7.01:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, debenture, note 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
shall be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specially prescribed); and any Resolution
of the Company 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 and the written advice of such
counsel or any 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 written 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 security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby;
(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;
(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,
note or other paper or document, unless requested in writing to do so by the
holders of Securities pursuant to Section 6.06; 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
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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 costs, expenses or liabilities as a condition to so proceeding; and
provided further, that nothing in this subsection (f) shall require the Trustee
to give the Securityholders any notice other than that required by Section 6.07.
The reasonable expense of every such examination shall be paid by the Company
or, if paid by the Trustee, shall be repaid by the Company upon demand;
(g) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
(h) The Trustee shall be under no responsibility for the approval by it in
good faith of any expert for any of the purposes expressed in this Indenture.
SECTION 7.03. Trustee Not Liable for Recitals in Indenture or in
Securities.
The recitals contained herein and in the Securities (other than the
certificate of authentication on the Securities) shall be taken as the
statements of the Company, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. The Trustee shall not be
accountable for the use or application by the Company of any of the Securities
or of the proceeds thereof.
SECTION 7.04. May Own Securities.
The Trustee or any agent of the Company or of the Trustee, 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 or such agent.
SECTION 7.05. Moneys Received by Trustee to Be Held in Trust without
Interest.
Subject to the provisions of Section 12.04, all moneys received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder.
SECTION 7.06. Trustee Entitled to Compensation, Reimbursement and
Indemnity.
The Company covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
any express trust), and, the Company will pay or reimburse the Trustee upon its
request for all reasonable expenses,
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disbursements and advances incurred or made by the Trustee in connection with
the acceptance or administration of its trust under this Indenture (including
the reasonable compensation and the expenses and disbursements of its agents and
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 the Trustee and its agents for, and to hold
them harmless against, any loss, liability or expense incurred without
negligence or bad faith on their part and arising out of or in connection with
the acceptance or administration of this trust and performance of their duties
hereunder, including the costs and expenses (including fees and disbursements of
their counsel) of defending themselves against any claim or liability in
connection with the exercise or performance of any of the powers or duties
hereunder. The obligations of the Company under this Section to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disbursements and
advances and to indemnify and hold harmless the Trustee shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture and the resignation or removal of the Trustee. 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 payment of principal of or interest, if any,
on particular Securities.
SECTION 7.07. Right of Trustee to Rely on Officers' Certificate Where No
Other Evidence Specifically Prescribed.
Except as otherwise provided in Section 7.01, 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
suffering or omitting any action hereunder, such matter (unless other evidence
in respect thereof be 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, suffered or
omitted by it under the provisions of this Indenture upon the faith thereof.
SECTION 7.08. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire any conflicting interest, within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under any Trust Agreement and the Trust
Securities issued or to be issued thereunder; any Preferred Securities Guarantee
Agreement relating to a Bear Stearns Trust (as defined herein and in the
Existing Indenture) between the Company and The Chase Manhattan Bank, as
guarantee trustee; any Amended and Restated Trust Agreement related to a Bear
Stearns Trust (as defined in the Existing Indenture) among the Company, as
depositor, The Chase Manhattan Bank, as property trustee, Chase Manhattan Bank
Delaware, as Delaware trustee, the administrators named therein and the
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several holders and the Trust Securities issued or to be issued thereunder; or
the Existing Indenture and the securities issued or to be issued thereunder.
SECTION 7.09. Requirements for Eligibility of Trustee.
---------------------------------------
The Trustee hereunder shall at all times be a corporation organized and
doing business under the laws of the United States or any State or territory
thereof or of the District of Columbia authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by federal, state,
territorial, or District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section, 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. In case at any time the Trustee shall cease to
be eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 7.10.
Neither the Company, any other obligor upon the Securities, nor any person
directly or indirectly controlling, controlled by, or under common control with
the Company or any such obligor shall serve as Trustee under this Indenture.
SECTION 7.10. Resignation of Trustee.
(a) The Trustee, or any trustee or trustees hereafter appointed, may at any
time resign with respect to one or more or all series of Securities by giving
written notice of such resignation to the Company and by giving to the holders
of Securities of the applicable series notice thereof in the manner and to the
extent provided in subsection (c) of Section 5.04 with respect to reports
pursuant to subsection (a) of Section 5.04. Upon receiving such notice of
resignation and if the Company shall deem it appropriate evidence satisfactory
to it of such mailing, the Company shall promptly appoint a successor Trustee
with respect to the applicable series (it being understood that any successor
Trustee may be appointed with respect to the Securities of one or more or all of
such series and at any time there shall be only one Trustee with respect to the
Securities of any particular series) by written instrument, in duplicate,
executed pursuant to a Resolution of the Company, 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 with respect to
any series and have accepted appointment within 30 days after the mailing of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee, or any
Securityholder who has been a bona fide holder of a Security or Securities of
the applicable series for at least six months may, subject to the provisions of
Section 6.08, 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:
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(1) The Trustee shall fail to comply with the provisions of
Section 7.08 after written request therefor by the Company or by any
Securityholder who has been a bona fide holder of a Security or
Securities of the applicable series for at least six months, unless the
Trustee's duty to resign is stayed as provided in Section 310(b) of the
Trust Indenture Act, or
(2) The Trustee shall cease to be eligible in accordance with the
provisions of Section 7.09 and shall fail to resign after written
request therefor by the Company or by any such Securityholder, or
(3) The Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then, in any
such case, the Company may remove the Trustee with respect to the
applicable series and appoint a successor Trustee with respect to the
applicable series by written instrument, in duplicate, executed
pursuant to a Resolution of the Company, 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 6.08, any
Securityholder who has been a bona fide holder of a Security or
Securities of the applicable series 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 with respect to the applicable
series. 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 principal amount of the Securities of any
one series voting as a separate class or all series voting as one class at the
time outstanding (determined as provided in Section 8.04) may at any time remove
the Trustee with respect to the applicable series or all series, as the case may
be, and appoint a successor Trustee with respect to the applicable series or all
series, as the case may be, by written instrument or instruments signed by such
holders or their attorneys-in-fact duly authorized, or by the affidavits of the
permanent chairman and secretary of a meeting of the Securityholders evidencing
the vote upon a resolution or resolutions submitted thereto with respect to such
removal and appointment (as provided in Article IX), and by delivery thereof to
the Trustee so removed, to the successor Trustee and to the Company.
(d) Any resignation or removal of the Trustee and any appointment of a
successor Trustee pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor Trustee as provided in
Section 7.11.
SECTION 7.11. Acceptance by Successor Trustee.
Any successor Trustee with respect to all series of Securities appointed as
provided in Section 7.10 shall execute, acknowledge and deliver to the Company
and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the
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resignation or removal of the predecessor Trustee with respect to all series
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 with respect to such series 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 7.06, execute and deliver an instrument transferring to such
successor Trustee all the rights and powers with respect to such series of the
Trustee so ceasing to act. Upon the 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 or any successor Trustee
to secure any amounts then due it pursuant to the provisions of Section 7.06.
In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of such series
shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of such series to which the
appointment of such successor Trustee relates, (2) if the retiring Trustee is
not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of such
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental Indenture shall
constitute such Trustees co-Trustees of the same trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of such series to which
the appointment of such successor Trustee relates; but, on request of the
Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of such series to
which the appointment of such successor Trustee relates.
No successor Trustee shall accept appointment as provided in this Section
unless at the time of such acceptance such successor Trustee shall be qualified
under the provisions of Section 7.08 and eligible under the provisions of
Section 7.09.
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Upon acceptance of appointment by a successor Trustee as provided in this
Section, the successor Trustee shall at the expense of the Company transmit
notice of the succession of such Trustee hereunder to the holders of Securities
of any applicable series in the manner and to the extent provided in subsection
(c) of Section 5.04 with respect to reports pursuant to subsection (a) of said
Section 5.04.
SECTION 7.12. Successor to Trustee by Merger, Consolidation or Succession
to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be qualified under the provisions of Section
7.08 and eligible under the provisions of Section 7.09, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the 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 it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided, however, that the
right to adopt the certificate of authentication of any predecessor Trustee or
to authenticate Securities in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.
SECTION 7.13. Limitations on Rights of Trustee as a Creditor to Obtain
Payment of Certain Claims within Three Months Prior to Default or During
Default, or to Realize on Property as such Creditor Thereafter.
(a) Subject to the provisions of subsection (b) of this Section, if the
Trustee shall be or shall become a creditor, directly or indirectly, secured or
unsecured, of the Company or of any other obligor on the Securities within three
months prior to a default, as defined in subsection (c) of this Section, or
subsequent to such a default, then, unless and until such default shall be
cured, the Trustee shall set apart and hold in a special account for the benefit
of the Trustee individually, the holders of the Securities of the one or more
indenture securities (as defined in subsection (c) of this Section):
(1) An amount equal to any and all reductions in the amount due
and owing upon any claim as such creditor in respect of principal or
interest, effected alter the beginning of such three months' period,
and valid as against the Company and its other creditors, except any
such reduction resulting from the receipt or disposition of
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any property described in paragraph (2) of this subsection, or from the
exercise of any right of set-off which the Trustee could have exercised
if a petition in bankruptcy had been filed by or against the Company
upon the date of such default; and
(2) All property received by the Trustee in respect of any claims
as such creditor, either as security therefor, or in satisfaction or
composition thereof, or otherwise, after the beginning of such three
months' period, or an amount equal to the proceeds of any such property
if disposed of, subject, however, to the rights, if any, of the Company
and its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the Trustee:
(A) To retain for its own account (i) payments made on account of
any such claim by any person (other than the Company) who is liable
thereon, (ii) the proceeds of the bona fide sale of any such claim by
the Trustee to a third person, and (iii) distributions made in cash,
securities, or other property in respect of claims filed against the
Company in bankruptcy or receivership or in proceedings for
reorganization pursuant to title 11 of the United States Code or
applicable state laws;
(B) To realize, for its own account, upon any property held by it
as security for any such claim, if such property was so held prior to
the beginning of such three months' period;
(C) To realize, for its own account, but only to the extent of the
claim hereinafter mentioned, upon any property held by it as security
for any such claim, if such claim was created after the beginning of
such three months' period and such property was received as security
therefor simultaneously with the creation thereof, and if the Trustee
shall sustain the burden of proving that at the time such property was
so received, the Trustee had no reasonable cause to believe that a
default, as defined in subsection (c) of this Section, would occur
within three months; or
(D) To receive payment on any claim referred to in paragraph (B)
or (C) against the release of any property held as security for such
claim as provided in such paragraph (B) or (C), as the case may be, to
the extent of the fair value of such property.
For the purposes of paragraphs (B), (C), and (D), property substituted
after the beginning of such three months' period for property held as security
at the time of such substitution shall, to the extent of the fair value of the
property released, have the same status as the property released, and to the
extent that any claim referred to in any such paragraphs is created in renewal
of or in substitution for or for the purpose of repaying or refunding any
pre-existing claim of the Trustee as such creditor, such claim shall have the
same status as such pre-existing claim.
If the Trustee shall be required to account, the funds and property held in
such special account and the proceeds thereof shall be apportioned between the
Trustee, the holders
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of Securities of the one or more series for which it is acting as Trustee, and
the holders of other indenture securities in such manner that the Trustee, such
Securityholders and the holders of other indenture securities realize, as a
result of payments from such special account and payments of dividends on claims
filed against the Company in bankruptcy or receivership or in proceedings for
reorganization pursuant to title 11 of the United States Code or applicable
state law, the same percentage of their respective claims, figured before
crediting to the claim of the Trustee anytime on account of the receipt by it
from the Company of the funds and property in such special account and before
crediting to the respective claim's of the Trustee, such Securityholders, and
the holders of other indenture securities dividends on claims filed against the
Company in bankruptcy or receivership or in proceedings for reorganization
pursuant to title 11 of the United States Code or applicable state law, but
after crediting thereon receipts on account of the indebtedness represented by
their respective claims from all sources other than from such dividends and from
the funds and property so held in such special account. As used in this
paragraph, with respect to any claim, the term "dividends" shall include any
distribution with respect to such claim in bankruptcy or receivership or in
proceedings for reorganization pursuant to title 11 of the United States Code or
applicable state law, whether such distribution is made in cash, securities, or
other property, but shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which such bankruptcy,
receivership or proceeding for reorganization is pending shall have jurisdiction
(i) to apportion among the Trustee, such Securityholders, and the holders of
other indenture securities, in accordance with the provisions of this paragraph,
the funds and property held in such special account and the proceeds thereof, or
(ii) in lieu of such apportionment, in whole or in part, to give to the
provisions of this paragraph due consideration in determining the fairness of
the distributions to be made to the Trustee, such Securityholders and the
holders of other indenture securities with respect to their respective claims,
in which event it shall not be necessary to liquidate or to appraise the value
of any securities or other property held in such special account or as security
for any such claim, or to make a specific allocation of such distributions as
between the secured and unsecured portions of such claim, or otherwise to apply
the provisions of this paragraph as a mathematical formula.
Any Trustee who has resigned or been removed after the beginning of such
three months' period shall be subject to the provisions of this subsection (a)
as though such resignation or removal had not occurred. If any Trustee has
resigned or been removed prior to the beginning of such three months' period, it
shall be subject to the provisions of this subsection (a) if and only if the
following conditions exist:
(i) The receipt of property or reduction of claim which would have
given rise to the obligation to account, if such Trustee had continued
as trustee, occurred after the beginning of such three months' period;
and
(ii) Such receipt of property or reduction of claim occurred
within three months after such resignation or removal;
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(b) There shall be excluded from the operation of subsection (a) of this
Section a creditor relationship arising from:
(1) The ownership or acquisition of securities issued under any
indenture, or any security or securities having a maturity of one year
or more at the time of acquisition by the Trustee;
(2) Advances authorized by a receivership or bankruptcy court of
competent jurisdiction, or by this Indenture, for the purpose of
preserving any property which shall at any time be subject to the lien
of this Indenture or of discharging tax liens or other prior liens or
encumbrances thereon, if notice of such advances and of the
circumstances surrounding the making thereof is given to the
Securityholders at the time and in the manner provided in Section
5.04(c) with respect to reports pursuant to subsections (a) and (b)
thereof, respectively;
(3) Disbursements made in the ordinary course of business in the
capacity of Trustee under an indenture, transfer agent, registrar,
custodian, Paying Agent, fiscal agent or depositary, or other similar
capacity;
(4) An indebtedness created as a result of services rendered or
premises rented; or an indebtedness created as a result of goods or
securities sold in a cash transaction as defined in subsection (c) of
this Section;
(5) The ownership of stock or of other securities of a corporation
organized under the provisions of Section 25(a) of the Federal Reserve
Act, as amended, which is directly or indirectly a creditor of the
Company; or
(6) The acquisition, ownership, acceptance or negotiation of any
drafts, bills of exchange, acceptances or obligations which fall within
the classification of self-liquidating paper as defined in subsection
(c) of this Section.
(c) As used in this Section:
(1) The term "default" shall mean any failure to make payment in
full of the principal of or interest upon any of the Securities or upon
the other indenture securities when and as such principal or interest
becomes due and payable.
(2) The term "other indenture securities" shall mean securities
upon which the Company is an obligor (as defined in the Trust Indenture
Act of 1939, as amended) outstanding under any other indenture (A)
under which the Trustee is also trustee, (B) which contains provisions
substantially similar to the provisions of subsection (a) of this
Section, and (C) under which a default exists at the time of the
apportionment of the funds and property held in said special account.
(3) The term "cash transaction" shall mean any transaction in
which full payment for goods or securities sold is made within seven
days after delivery of the
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goods or securities in currency or in checks or other orders drawn upon
banks or bankers and payable upon demand.
(4) The term "self-liquidating paper" shall mean any draft, bill
of exchange, acceptance or obligation which is made, drawn, negotiated
or incurred by the Company for the purpose of financing the purchase,
processing, manufacture, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise, or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security
is received by the Trustee simultaneously with the creation of the
creditor relationship with the Company arising from the making,
drawing, negotiating or incurring of the draft, bill of exchange,
acceptance or obligation.
(5) The term "Company" shall mean any obligor upon the Securities.
ARTICLE VIII
CONCERNING THE SECURITYHOLDERS
SECTION 8.01. Evidence of Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a specified
percentage in principal amount of the Securities of any or all series 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 IX, or (c) by a
combination of such instrument or instruments and any such record of such a
meeting of such Securityholders.
If there shall be more than one Trustee acting hereunder with respect to
separate series of Securities, such Trustees shall collaborate, if necessary, in
acting under Article IX and in determining whether the holders of a specified
percentage in principal amount of the Securities of any or all series have taken
any such action.
SECTION 8.02. Proof of Execution of Instruments and of Holding of
Securities.
Subject to the provisions of Sections 7.01, 7.02 and 9.05, proof of the
execution of any instrument by a Securityholder or his agent or proxy and proof
of the holding by any person of any of the Securities shall be sufficient if
made in the following manner:
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The fact and date of the execution by any such person of any instrument may
be proved in any reasonable manner acceptable to the Trustee.
The ownership of Securities of any series shall be proved by the Register
of such Securities of such series, or by certificates of the Security registrar
or registrars thereof.
The Trustee shall not be bound to recognize any person as a Securityholder
unless and until the title to the Securities held by him is proved in the manner
in this Article VIII provided.
The record of any Securityholders' meeting shall be proved in the manner
provided in Section 9.06.
The Trustee may accept such other proof or require such additional proof of
any matter referred to in this Section as it shall deem reasonable.
SECTION 8.03. Who May be Deemed Owners of Securities.
Prior to due presentment for registration of transfer of any Security, the
Company, the Trustee and any agent of the Company or the Trustee may deem and
treat the person in whose name such Security shall be registered upon the
Register of Securities of the series of which such Security is a part as the
absolute owner of such Security (whether or not such Security shall be overdue
and notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or an account of the principal of and interest,
subject to Section 2.03, on such Security and for all other purposes; and
neither the Company nor the Trustee nor any agent of the Company or the Trustee
shall be affected by any notice to the contrary. All such payments so made to
any such holder for the time being, or upon his order, shall be valid, and, to
the extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for moneys payable upon any such Security.
SECTION 8.04. Securities Owned by Company or Controlled or Controlling
Persons Disregarded for Certain Purposes.
In determining whether the holders of the requisite principal amount of
Securities have concurred in any demand, direction, request, notice, vote,
consent, waiver or other action 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 demand, direction, request, notice,
vote, consent, waiver or other action, only Securities which a Responsible
Officer of the Trustee assigned to its principal office 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, 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 a person directly or indirectly
controlling or controlled
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by or under direct or indirect common control with the Company or any such other
obligor. Upon 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 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; and, subject to
the provisions of Section 7.01, 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.
SECTION 8.05. Instruments Executed by Securityholders Bind Future Holders.
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.01, of the taking of any action by the holders of the
percentage in principal amount of the Securities specified in this Indenture in
connection with such action, any holder of a Security which is shown by the
evidence to be included in the Securities the holders of which have consented to
such action may, by filing written notice with the Trustee at its principal
office and upon proof of holding as provided in Section 8.02, revoke such action
so far as concerns such Security. Except as aforesaid any such action taken by
the holder of any Security and any direction, demand, request, notice, waiver,
consent, vote or other action of the holder of any Security which by any
provisions of this Indenture is required or permitted to be given shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security, and of any Security issued in lieu thereof or upon
registration of transfer thereof, irrespective of whether any notation in regard
thereto is made upon such Security. Any action taken by the holders of the
percentage in principal amount of the Securities of any or all series specified
in this Indenture in connection with such action shall be conclusively binding
upon the Company, the Trustee and the holders of all of the Securities of such
series subject, however, to the provisions of Section 7.01.
ARTICLE IX
SECURITYHOLDERS' MEETINGS
SECTION 9.01. Purposes for which Meeting May Be Called.
A meeting of holders of Securities of any or all series may be called at
any time and from time to time pursuant to the provisions of this Article for
any of the following purposes:
(1) 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 holders of Securities of any or all series,
as the case may be, pursuant to any of the provisions of Article VI;
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(2) To remove the Trustee and appoint a successor Trustee pursuant
to the provisions of Article VII;
(3) To consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 10.02; or
(4) To take any other action authorized to be taken by or on
behalf of the holders of any specified principal amount of the
Securities of any or all series, as the case may be, under any other
provision of this Indenture or under applicable law.
SECTION 9.02. Manner of Calling Meetings.
The Trustee may at any time call a meeting of Securityholders to take any
action specified in Section 9.01, to be held at such time and at such place in
the Borough of Manhattan, City of New York as the Trustee shall determine.
Notice of every meeting of Securityholders setting forth the time and place of
such meeting and in general terms the action proposed to be taken at such
meeting, shall be mailed not less than 20 nor more than 60 days prior to the
date fixed for the meeting.
SECTION 9.03. Call of Meeting by Company or Securityholders.
In case at any time the Company, pursuant to a resolution of its Board of
Directors, or the holders of not less than ten percent in principal amount of
the Securities of any or all series, as the case may be, then outstanding, shall
have requested the Trustee to call a meeting of holders of Securities of any or
all series, as the case may be, to take any action authorized in Section 9.01 by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have mailed notice of such
meeting within 20 days after receipt of such request, then the Company or such
holders of Securities in the amount above specified may determine the time and
place in the Borough of Manhattan, City of New York for such meeting and may
call such meeting to take any action authorized in Section 9.01, by mailing
notice thereof as provided in Section 9.02.
SECTION 9.04. Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Securityholders a person shall (a)
be a holder of one or more Securities with respect to which the meeting is being
held, or (b) be a person appointed by an instrument in writing as proxy by such
holder of one or more Securities. The only persons who shall be entitled to be
present or to speak at any meeting of Securityholders shall be the persons,
entitled to vote at such meeting and their counsel and any representatives of
the Trustee and its counsel and any representatives of the Company and its
counsel.
SECTION 9.05. Regulations May Be Made by Trustee.
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
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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. Except as otherwise permitted or required by any such
regulations, the holding of Securities shall be proved in the manner specified
in Section 8.02 and the appointment of any proxy shall be proved in the manner
specified in said Section 8.02; provided, however, that such regulations may
provide that written instruments appointing proxies regular on their face, may
be presumed valid and genuine without the proof hereinabove or in said Section
8.02 specified.
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 9.03, 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
Securityholder or proxy shall be entitled to one vote for each $1,000 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;
provided, however, that each holder of Original Issue Discount Securities shall
be entitled to one vote for each $1,000 amount which would be due upon
acceleration of his Original Issue Discount Security on the date of the meeting.
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 9.02 or 9.03
may be adjourned from time to time, and the meeting may be held so adjourned
without further notice.
At any meeting of Securityholders, the presence of persons holding or
representing Securities in principal amount sufficient to take action on the
business for the transaction of which such meeting was called shall constitute a
quorum, but, if less than a quorum is present, the persons holding or
representing a majority in principal amount of the securities represented at the
meeting may adjourn such meeting with the same effect for all intents and
purposes, as though a quorum had been present.
SECTION 9.06. Manner of Voting at Meetings and Record to be Kept.
The vote upon any resolution submitted to any meeting of Securityholders
shall be by written ballots on which shall be subscribed the signatures of the
holders of Securities or of their representatives by proxy and the principal
amount or principal amounts 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
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reports in duplicate 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 9.02. The record shall show the principal amount or
principal amounts of the Securities voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Company and the other to the Trustee 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.
SECTION 9.07. Exercise of Rights of Trustee, Securityholders and Holders of
Preferred Securities Not to Be Hindered or Delayed.
Nothing in this Article contained shall be deemed or construed to authorize
or permit, by reason of any call of a meeting of Securityholders or any rights
expressly or impliedly conferred hereunder to make such call any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee, to the Securityholders or the holders of Preferred Securities under any
of the provisions of this Indenture or of the Securities.
ARTICLE X
SUPPLEMENTAL INDENTURES
SECTION 10.01. Purposes for Which Supplemental Indentures May Be Entered
into without Consent of Securityholders.
The Company, when authorized by a Resolution of the Company, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto, in form satisfactory to such Trustee (which
shall comply with the provisions of the Trust Indenture Act of 1939 as then in
effect), for one or more of the following purposes:
(a) To evidence the succession of another corporation to the Company, or
successive successions, and the assumption by the successor corporation of the
covenants, agreements and obligations of the Company pursuant to Article XI
hereof and to comply with Section 15.07.
(b) To add to the covenants of the Company such further covenants,
restrictions or conditions as the Company and the Trustee shall consider to be
for the protection of the holders of all or any series of Securities (and if
such covenants, restrictions or conditions are to be for the benefit of less
than all series of Securities, stating that such covenants, restrictions or
conditions are expressly being included solely for the benefit of such
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series), and to make the occurrence, or the occurrence and continuance, of a
default in any such additional covenants, restrictions or conditions a default
or an Event of Default permitting the enforcement of all or any of the several
remedies provided in this Indenture as herein set forth; provided, however, that
in respect to any such additional covenant, restriction or condition such
supplemental indenture 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 add or change any of the provisions of this Indenture to such extent
as shall be necessary to permit or facilitate the issuance of Securities in
bearer form, registrable or not registrable as to principal, and with or without
interest coupons;
(d) To change or eliminate any of the provisions of this Indenture;
provided, however, that any such change or elimination shall become effective
only when there is no Security of any series outstanding created prior to the
execution of such supplemental indenture which is entitled to the benefit of
such provision;
(e) To establish the form or terms of Securities of any series as permitted
by Sections 2.01 and 2.02;
(f) To cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provisions contained herein or in any supplemental
indenture, or to make such other provision in regard to matters or questions
arising under this Indenture or any supplemental indenture; provided that such
action shall not adversely affect the interest of the holders of Securities of
any series in any material respect or, in the case of the Securities of a series
issued to a Bear Stearns Trust and for so long as any of the corresponding
series of Preferred Securities issued by such Bear Stearns Trust shall remain
outstanding, the holders of such Preferred Securities;
(g) To mortgage or pledge to the Trustee as security for the Securities any
property or assets which the Company may desire to mortgage or pledge as
security for the Securities; and
(h) To qualify, or maintain the qualification of, the Indenture under the
Trust Indenture Act.
The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, to make any further appropriate agreements
and stipulations which may be therein contained and to accept the conveyance,
transfer, mortgage, pledge or assignment of any property thereunder, but the
Trustee shall not be obligated to enter into any such supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
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Any supplemental indenture authorized by the provisions of this Section 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 10.02.
SECTION 10.02. Modification of Indenture with Consent of Holders of a
Majority in Principal Amount of Securities.
With the consent (evidenced as provided in Section 8.01) of the holders of
not less than a majority in principal amount of the Securities of all series at
the time outstanding (determined as provided in Section 8.04) affected by such
supplemental indenture (voting as one class), the Company, when authorized by a
Resolution of the Company, and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto (which shall be in
conformity with the provisions of the Trust Indenture Act of 1939 as then in
effect) for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental
indenture or of modifying in any manner the rights of the holders of the
Securities of each such series; provided, however, that no such supplemental
indenture shall (i) change the fixed maturity of any Securities, or reduce the
rate or extend the time of payment of any interest thereon, or reduce the
principal amount thereof, or change the provisions pursuant to which the rate of
interest on any Security is determined if such change could reduce the rate of
interest thereon, or reduce the minimum rate of interest thereon, or reduce any
amount payable upon any redemption thereof, or adversely affect any right to
convert the Securities in accordance herewith, or reduce the amount to be paid
at maturity or upon redemption, or make the principal thereof or any interest
thereon or on any overdue principal amount payable in any coin or currency other
than that provided in the Security without the consent of the holder of each
Security so affected, (ii) reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holders of all Securities then Outstanding, or (iii)
modify any of the provisions of this Section, Section 4.07 or Section 6.06,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of
the holder of each Security affected thereby or (iv) modify the provisions of
Article XIV with respect to the subordination of outstanding Securities of any
series in a manner adverse to the holders thereof, without the consent of the
holder of each Security so affected, provided that, in the case of the
Securities of a series issued to a Bear Stearns Trust, so long as any of the
corresponding series of Preferred Securities issued by such Bear Stearns Trust
remains outstanding, (i) no such amendment shall be made that adversely affects
the holders of such Preferred Securities in any material respect (including any
amendment which would result in a Bear Stearns Trust being classified as other
than a grantor trust for United States federal income taxes), and no termination
of this Indenture shall occur, and no waiver of any Event of Default with
respect to such series or compliance with any covenant with respect to such
series under this Indenture shall be effective, without the prior consent of the
holders of at least a majority of the aggregate liquidation preference of such
Preferred Securities then outstanding unless and until the principal (and
premium, if any) of the Securities of such series and all accrued and unpaid
interest (including any Additional Sums, Additional Interest, Compounded
Interest or Special Interest, if any) thereon have been paid in full; and (ii)
no amendment shall
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be made to Section 6.05 of this Indenture that would impair the rights of the
holders of Preferred Securities provided therein without the prior consent of
the holders of each Preferred Security then outstanding. unless and until the
principal (and premium, if any) of the Securities of such series and all accrued
and unpaid interest (including any Additional Sums, Additional Interest,
Compounded Interest and Special Interest) thereon have been paid in full.
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities or Preferred Securities,
or which modifies the rights of holders of Securities or holders of Preferred
Securities of such series with respect to such covenant or other provision,
shall be deemed not to affect the rights under this Indenture of the holders of
Securities or holders of Preferred Securities of any other series.
Upon the request of the Company, accompanied by a copy of a Resolution of
the Company certified by the Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental indenture, 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.
It shall not be necessary for the consent of the Securityholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such consent shall approve the substance thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Company
shall mail a notice to the holders of Securities of each series so affected,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
SECTION 10.03. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture pursuant to the provisions
of this Article, 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.
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The Trustee shall be entitled to receive, and subject to the provisions of
Section 7.01 shall be entitled to rely upon, an Opinion of Counsel as conclusive
evidence that any such supplemental indenture complies with the provisions of
this Article 10.
SECTION 10.04. Securities May Bear Notation of Changes by Supplemental
Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article, or after any
action taken at a Securityholders' meeting pursuant to Article IX, may bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture or as to any action taken at any such meeting. 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 of the
Company, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Securities then outstanding.
SECTION 10.05. Revocation and Effect of Consents.
Subject to Section 8.05, until an amendment, supplement, waiver or other
action becomes effective, a consent to it by a Securityholder of a Security is a
continuing consent conclusive and binding upon such Securityholder and every
subsequent Securityholder of the same Security or portion thereof, and of any
Security issued upon the registration of transfer thereof or in exchange
therefor or in place thereof, even if notation of the consent is not made on any
such Security. Subject to Section 8.05, any such Securityholder or subsequent
Securityholder may not revoke the consent as to his Security or portion of a
Security.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Securityholders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the
preceding paragraph, those Persons who were Securityholders at such record date
(or their duly designated proxies), and only such Persons, shall be entitled to
consent or revoke such consent to such amendment, supplement or waiver, whether
or not such Persons continue to be Securityholders after such record date. No
such consent shall be valid or effective for more than 180 days after such
record date.
After an amendment, supplement, waiver or other action becomes effective,
it shall bind every Securityholder.
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ARTICLE XI
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 11.01. Company May Consolidate, Etc., on Certain Terms.
The Company covenants that it will not merge or consolidate with any other
corporation or sell or convey all or substantially all of its assets to any
person, firm or corporation, unless (i) either the Company shall be the
continuing corporation, or the successor corporation (if other than the Company)
shall be a corporation organized and existing under the laws of the United
States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume the due and punctual payment of the principal
of and interest on all the Securities, according to their tenor, and the due and
punctual performance and observance of all of the covenants and conditions of
this Indenture to be performed by the Company by supplemental indenture in form
satisfactory to the Trustee, executed and delivered to the Trustee by such
corporation, (ii) the Company or such successor corporation, as the case may be,
shall not, immediately after such merger or consolidation, or such sale or
conveyance, be in default in the performance of any such covenant or condition,
and (iii) in the case of Securities of a series issued to a Bear Stearns Trust,
such consolidation, merger, sale or conveyance is permitted under the related
Trust Agreement and Guarantee and does not give rise to any breach or violation
of the related Trust Agreement or Guarantee.
SECTION 11.02. Successor Corporation Substituted.
In case of any such consolidation, merger, sale or conveyance and upon any
such assumption by the successor corporation, such successor corporation 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. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of the Company, any or all of the Securities issuable hereunder which
theretofore shall not have been delivered to the Trustee; and upon the order of
such successor corporation, instead of the Company, and subject to all the
terms, conditions and limitations in this Indenture prescribed, the Trustee
shall authenticate and shall deliver any Securities which previously shall have
been signed and delivered by the officers of the Company to the Trustee, and any
Securities which such successor corporation thereafter shall cause to be signed
and delivered to the Trustee. 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 Securities had been issued at the date of the execution
hereof.
In case of any such consolidation, merger, sale or conveyance such changes
in phraseology and form (but not in substance) may be made in the Securities
thereafter to be issued as may be appropriate.
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SECTION 11.03. Opinion of Counsel to Trustee.
The Trustee shall be entitled to receive, and subject to the provisions of
Section 7.01 shall be entitled to rely upon, an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale or conveyance and any such
assumption, complies with the provisions of this Article and that all conditions
precedent herein provided for relating to such transaction have been complied
with.
ARTICLE XII
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 12.01. Satisfaction and Discharge of Indenture.
If (a) the Company shall deliver to the Trustee for cancellation all
Securities of any series theretofore authenticated (other than any Securities of
such series which shall have been destroyed, lost or stolen and which shall have
been replaced or paid as provided in Section 2.07) and not theretofore canceled,
or (b) all the Securities of such series not theretofore canceled 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 as trust funds the entire amount sufficient to pay at maturity or upon
redemption all of such Securities not theretofore canceled or delivered to the
Trustee for cancellation, including principal and any interest due or to become
due to such date of maturity or redemption date, as the case may be, and if in
either case the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company with respect to Securities of such series, then
this Indenture shall cease to be of further effect with respect to Securities of
such series (except as to (i) remaining rights of registration of transfer,
conversion, substitution and exchange and the Company's right of optional
redemption of Securities of such series, (ii) rights hereunder of holders to
receive payments of principal of and any interest on, the Securities of such
series, and other rights, duties and obligations of the holders of Securities of
such series as beneficiaries hereof with respect to the amounts, if any, so
deposited with the Trustee, and (iii) the rights, obligations and immunities of
the Trustee hereunder), and the Trustee, on demand of the Company, and at the
cost and expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture. The Company hereby agrees to
compensate the Trustee for any services thereafter reasonably and properly
rendered and to reimburse the Trustee for any costs or expenses theretofore and
thereafter reasonably and properly incurred by the Trustee in connection with
this Indenture or the Securities of such series.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Securities of any or all series, the obligations of the Company
to the Trustee under Section 7.06 hereof shall survive.
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SECTION 12.02. Application by Trustee of Funds Deposited for Payment of
Securities.
Subject to Section 12.04, all moneys deposited with the Trustee pursuant to
Section 12.01 shall be held in trust and applied by it to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent), to the holders of the particular Securities of such series, for
the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal and interest.
SECTION 12.03. Repayment of Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture with
respect to Securities of any series, all moneys with respect to Securities of
such series then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be paid to the Trustee and thereupon such
Paying Agent shall be released from all further liability with respect to such
moneys.
SECTION 12.04. Repayment of Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent for the payment
of the principal of or any interest on any Securities of any series and not
applied but remaining unclaimed by the holders of Securities of such series for
two years after the date upon which such payment shall have become due and
payable, shall, at the request of the Company, be repaid to the Company by the
Trustee or by such Paying Agent; and the holder of any of the Securities of such
series entitled to receive such payment shall thereafter look only to the
Company for the payment thereof; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once a week for two successive
weeks (in each case on any day of the week) in an Authorized Newspaper, or
mailed to the registered holders thereof, a notice that said moneys have not
been so applied and that after a date named therein any unclaimed balance of
said money then remaining will be returned to the Company.
ARTICLE XIII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS,
DIRECTORS AND EMPLOYEES
SECTION 13.01. Incorporators, Stockholders, Officers, Directors and
Employees of Company Exempt from Individual Liability.
No recourse under or upon any obligation, covenant or agreement of this
Indenture, or of any Security, or for any claim based thereon or otherwise in
respect thereof, shall be had against any incorporator, stockholder, officer,
director or employee, as such, past, present or future, of the Company or of any
successor corporation, either directly or through the Company, whether by virtue
of any constitution, statute or rule of law, or by the
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enforcement of any assessment or penalty or otherwise; it being expressly
understood that this Indenture and the obligations issued hereunder are solely
corporate obligations, and that no personal liability whatever shall attach to,
or is or shall be incurred by, the incorporators, stockholders, officers or
directors, as such, of the Company or any successor corporation, or any of them,
because of the creation of the indebtedness hereby authorized, or under or by
reason of the obligations, covenants or agreements contained in this Indenture
or in any of the Securities or implied therefrom; and that any and all such
personal liability of every name and nature, either at common law or in equity
or by constitution or statute, of, and any and all such rights and claims
against every such incorporator, stockholder, officer or director, as such,
because of the creation of the indebtedness hereby authorized, or under or by
reason of the obligations, covenants or agreements contained in this Indenture
or in any of the Securities or implied therefrom are hereby expressly waived and
released as a condition of and as a consideration for, the execution of this
Indenture and the issue of such Securities.
ARTICLE XIV
SUBORDINATION OF SECURITIES
SECTION 14.01. Agreement to Subordinate.
The Company, for itself, its successors and assigns, covenants and agrees,
and each holder of a Security of any series likewise covenants and agrees by his
acceptance thereof, that the Securities of any series shall be subordinate and
junior in right of payment to all Senior Indebtedness of the Company, and that
upon any payment or distribution of assets of the Company upon any liquidation,
dissolution, winding-up, reorganization, assignment for benefit of creditors,
marshaling of assets or any bankruptcy, insolvency, debt restructurings or
similar proceedings or in connection with any insolvency or bankruptcy
proceedings of the Company, the holders of Senior Indebtedness of the Company
shall first be entitled to receive payment in full of principal of (and premium,
if any) and interest, if any, on such Senior Indebtedness before any payment
shall be made on account of the principal of or interest on any of the
Securities. In the event of any such proceeding, after payment in full of all
sums owing with respect to Senior Indebtedness of the Company, the holders of
the Securities of each series, together with the holders of any obligations of
the Company ranking on a parity with the Securities, shall be entitled to be
paid from the remaining assets of the Company the amounts at the time due and
owing on account of unpaid principal of and interest on the Securities of any
series before any payment or other distribution, whether in cash, property or
otherwise, shall be made on account of any capital stock or any obligations of
the Company ranking junior to the Securities. In addition, in the event of any
such proceeding, if any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, including any such
payment or distribution which may be payable or deliverable by reason of the
payment of any other indebtedness of the Company being subordinated to the
payment of the Securities of any series shall be received by the Trustee or the
holders of the Securities of any series before all Senior Indebtedness of the
Company is paid in full, such payment or distribution shall be held in trust for
the benefit of and shall be paid over to the holders of such Senior Indebtedness
of the Company or their representative or
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representatives or to the trustee or trustees under any indenture under which
any instruments evidencing any of such Senior Indebtedness of the Company may
have been issued, ratably, for application to the payment of all Senior
Indebtedness of the Company remaining unpaid until all such Senior Indebtedness
of the Company shall have been paid in full, after giving effect to any
concurrent payment or distribution to the holders of such Senior Indebtedness of
the Company. The obligations of the Company in respect of the Securities of all
series shall rank on a parity with any obligations of the Company ranking on a
parity with the Securities. Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.06.
The Company shall give prompt written notice to the Trustee of any
insolvency, receivership, conservatorship, reorganization, readjustment of debt,
marshaling of assets and liabilities or similar proceedings or any liquidation
or winding-up of or relating to the Company as a whole, whether voluntary or
involuntary and of any event specified in Section 14.09. The Trustee, subject to
the provisions of Section 7.01, shall be entitled to assume that, and may act as
if, no event referred to in the preceding sentence has occurred unless a
Responsible Officer of the Trustee assigned to the Trustee's Corporate Trustee
Administration Department has received at the principal office of the Trustee
from the Company or any one or more holders of Senior Indebtedness of the
Company or any trustee or representative therefor (who shall have been certified
or otherwise established to the satisfaction of the Trustee to be such a holder
or trustee or representative) written notice thereof. Upon any distribution of
assets of the Company referred to in this Article, the Trustee and holders of
the Securities of each series shall be entitled to rely upon any order or decree
of a court of competent jurisdiction in which proceedings relating to any event
specified in the first sentence of this paragraph are pending for the purpose of
ascertaining the persons entitled to participate in such distribution, the
holders of the Senior 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, and the Trustee, subject to the provisions
of Article VII, and the holders of the Securities of each series shall be
entitled to rely upon a certificate of the liquidating trustee or agent or other
person making any distribution to the Trustee or to the holders of the
Securities of each series for the purpose of ascertaining the persons entitled
to participate in such distribution, the holders of the Senior 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.
In the absence of any such liquidating trustee, agent or other person, the
Trustee shall be entitled to rely upon a written notice by a Person representing
himself to be a holder of Senior Indebtedness of the Company (or a trustee or
representative on behalf of such holder) as evidence that such Person is a
holder of such Senior Indebtedness (or is such a trustee or representative). 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 Senior
Indebtedness of the Company, to participate in any payment or distribution
pursuant to this Article, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, as to the extent to which such Person
is entitled to participation in such payment or distribution, and as to other
facts pertinent to the rights of such Person under this Article,
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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.
The Securities shall rank pari passu with, and shall not be superior in
right of payment to, any securities issued and outstanding under the Existing
Indenture.
SECTION 14.02. Obligation of the Company Unconditional.
Nothing contained in this Article or elsewhere in this Indenture is
intended to or shall impair, as between the Company and the holders of the
Securities of each series, the obligation of the Company, which is absolute and
unconditional, to pay to such holders the principal of and interest on such
Securities of each series when, where and as the same shall become due and
payable, all in accordance with the terms of such Securities, or is intended to
or shall affect the relative rights of such holders and creditors of the Company
other than the holders of the Senior Indebtedness of the Company, 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 this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness of the Company in respect of cash, property, or
securities of the Company received upon the exercise of any such remedy.
SECTION 14.03. Limitations on Duties to Holders of Senior Indebtedness of
the Company.
With respect to the holders of Senior 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, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness of
the Company shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness of the Company, except with respect to moneys held in trust
pursuant to the first paragraph of Section 14.01.
SECTION 14.04. Notice to Trustee of Facts Prohibiting Payment.
Notwithstanding any of the provisions of this Article or any other
provisions of this Indenture, the Trustee shall not at any time be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of moneys to or by the Trustee unless and until a Responsible Officer of
the Trustee assigned to its Corporate Trustee Administration Department shall
have received at the principal office of the Trustee written notice thereof from
the Company or from one or more holders of Senior Indebtedness of the Company or
from any trustee or representative therefor who shall have been certified by the
Company or otherwise established to the reasonable satisfaction of the Trustee
to be such a holder or trustee or representative; and, prior to the receipt of
any such written notice, the Trustee, subject to the provisions of Section 7.01,
shall be entitled in all respects to assume that no such facts exist; provided,
however, that, if prior to the fifth Business Day preceding the date upon which
by the terms hereof any such moneys may become payable for any purpose, or in
the event of the execution of an instrument pursuant to Section 12.01
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acknowledging satisfaction and discharge of this Indenture, then if prior to the
second Business Day preceding the date of such execution, the Trustee shall not
have received with respect to such moneys the notice provided for in this
Section, then, anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such moneys and/or apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or after such date;
provided, however, no such application shall affect the obligations under this
Article of the Persons receiving such moneys from the Trustee.
SECTION 14.05. Application by Trustee of Moneys Deposited with It.
Anything in this Indenture to the contrary notwithstanding, any deposit of
moneys by the Company with the Trustee or any agent (whether or not in trust)
for any payment of the principal of or interest on any Securities shall, except
as provided in Section 14.04, be subject to the provisions of Section 14.01.
SECTION 14.06. Subrogation.
Subject to the payment in full of all Senior Indebtedness of the Company,
the holders of the Securities of each series shall be subrogated to the rights
of the holders of such Senior Indebtedness to receive payments or distributions
of assets of the Company applicable to such Senior Indebtedness until the
Securities shall be paid in full, and none of the payments or distributions to
the holders of such Senior Indebtedness to which the holders of the Securities
of any series or the Trustee would be entitled except for the provisions of this
Article or of payments over, pursuant to the provisions of this Article, to the
holders of such Senior Indebtedness by the holders of such Securities or the
Trustee shall, as between the Company, its creditors other than the holders of
such Senior Indebtedness, and the holders of such Securities, be deemed to be a
payment by the Company to or on account of such Senior Indebtedness; it being
understood that the provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the holders of such Securities,
on the one hand, and the holders of the Senior Indebtedness of the Company, on
the other hand.
SECTION 14.07. Subordination Rights Not Impaired by Acts or Omissions of
Company or Holders of Senior Indebtedness of the Company.
No right of any present or future holders of any Senior 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 or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof with which any such holder
may have or be otherwise charged. The holders of Senior Indebtedness of the
Company may, at any time or from time to time and in their absolute discretion,
change the manner, place or terms of payment, change or extend the time of
payment of, or renew or alter, any such Senior Indebtedness of the Company, or
amend or supplement any instrument pursuant to which any such Senior
Indebtedness of the Company is issued or by which it may be secured, or release
any security therefor, or exercise or refrain
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from exercising any other of their rights under the Senior Indebtedness of the
Company including, without limitation, the waiver of default thereunder, all
without notice to or assent from the holders of the Securities of each series or
the Trustee and without affecting the obligations of the Company, the Trustee or
the holders of such Securities under this Article.
SECTION 14.08. Authorization of Trustee to Effectuate Subordination of
Securities.
Each holder of a Security of any series, by his acceptance thereof,
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate, as between the holders of such
Securities and the holders of Senior Indebtedness of the Company, the
subordination provided in this Article. If, in the event of any proceeding or
other action relating to the Company referred to in the first sentence of
Section 14.01, a proper claim or proof of debt in the form required in such
proceeding or action is not filed by or on behalf of the holders of the
Securities of any series prior to fifteen days before the expiration of the time
to file such claim or claims, then the holder or holders of Senior Indebtedness
of the Company shall have the right to file and are hereby authorized to file an
appropriate claim for and on behalf of the holders of such Securities.
SECTION 14.09. No Payment when Senior Indebtedness in Default.
In the event and during the continuation of any default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness, or in
the event that any event of default with respect to any Senior Indebtedness
shall have occurred and be continuing and shall have resulted in such Senior
Indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and such acceleration shall have been rescinded or annulled, or in the event any
judicial proceeding shall be pending with respect to any such default in payment
or such event or default, then no payment or distribution of any kind or
character, whether in cash, properties or securities shall be made by the
Company on account of principal of (or premium, if any) or interest (including
any Additional Sums, Additional Interest, Compounded Interest and Special
Interest), if any, on the Securities or on account of the purchase or other
acquisition of Securities by the Company or any subsidiary.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such holder, then and in such event payment shall be paid over and delivered
forthwith to the Company.
SECTION 14.10. Right of Trustee to Hold Senior Indebtedness of the Company.
The Trustee shall be entitled to all of the rights set forth in this
Article in respect of any Senior Indebtedness of the Company at any time held by
it in its individual
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capacity to the same extent as any other holder of such Senior Indebtedness, and
nothing in this Indenture shall be construed to deprive the Trustee of any of
its rights as such holder.
SECTION 14.11. Article XIV Not to Prevent Defaults.
The failure to make a payment pursuant to the terms of Securities of any
series by reason of any provision in this Article shall not be construed as
preventing the occurrence of a default under this Indenture.
ARTICLE XV
CONVERSION OF SECURITIES
SECTION 15.01. Applicability of Article.
Securities of any series which are convertible into Capital Stock of the
Company shall be convertible in accordance with their terms and (except as
otherwise specified as contemplated by Section 2.01 for Securities of any
series) in accordance with this Article.
SECTION 15.02. Conversion Privilege.
If Securities of a series are subject to conversion, as specified pursuant
to Section 2.01, then subject to and upon compliance with the provisions of this
Article, at the option of the holder thereof, any such Security may, at any time
until and including, but not after the close of business on the date specified
in such Security, or in case such Security or some portion thereof shall be
called for redemption pursuant to Section 3.02 prior to such date, then, with
respect to such Security or portion thereof as is so called, until and
including, but (if no default is made in making due provision for the payment of
the redemption price) not after, the close of business on, the date fixed for
redemption, be converted, in whole, or in part in whole multiples of $1,000
principal amount, at 100% of the principal amount of such Security (or portion
thereof), into fully paid and non-assessable shares of the Company's Capital
Stock, as specified in the Security, issuable upon conversion of the Securities,
at the conversion price in effect at the Date of Conversion (as hereinafter
defined).
SECTION 15.03. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the holder of any Security
to be converted shall surrender such Security to the Company at any time during
usual business hours at the offices or agencies to be maintained by the Company
in accordance with the provisions of Section 4.02 with respect to the Securities
to be converted, accompanied by a fully executed written notice, in the form set
forth on the reverse of the Security, that the holder elects to convert such
Security or a stated portion thereof constituting a whole multiple of $1,000
principal amount, and, if such Security is surrendered for conversion during the
period between the close of business on the record date next preceding the
Interest Payment Date (as defined in the Security) and the opening of business
on the Interest Payment Date and has not been called for redemption on a
redemption date within such period (or on such
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Interest Payment Date), accompanied also by payment of an amount equal to the
interest payable on such Interest Payment Date on the principal amount of the
Security being surrendered for conversion. Such notice shall also state the name
or names (with address) in which the certificate or certificates for shares of
Capital Stock shall be issued. Securities surrendered for conversion shall (if
so required by the Company or the registrar of such Securities) be duly endorsed
by, or be accompanied by written instrument or instruments of transfer in form
satisfactory to the Company and such registrar duly executed by, the holder or
its attorney duly authorized in writing. As promptly as practicable after the
receipt of such notice and the surrender of such Security as aforesaid, the
Company shall, subject to the provisions of Section 15.09, issue and deliver at
such office or agency to such holder, or to such other person on his written
order, a certificate or certificates for the number of full shares of Capital
Stock issuable on such conversion of Securities in accordance with the
provisions of this Article and cash as provided in Section 15.04, in respect of
any fraction of a share of Capital Stock otherwise issuable upon conversion.
Such conversion shall be deemed to have been effected immediately prior to the
close of business on the date (herein called the "Date of Conversion") on which
such notice shall have been received by the Company and such Security shall have
been surrendered as aforesaid, accompanied (if required by this Section) also by
payment of an amount equal to the interest payable on the next Interest Payment
Date on the principal amount of the Security being surrendered for conversion,
and the person or persons in whose name or names any certificate or certificates
for shares of Capital Stock shall be issuable upon such conversion shall be
deemed to have become on the Date of Conversion the holder or holders of record
of the shares of Capital Stock represented thereby; provided, however, that any
such surrender on any date when the stock transfer books of the Company shall be
closed shall constitute the person or persons in whose name or names the
certificate or certificates for such shares are to be issued as the recordholder
or holders thereof for all purposes at the opening of business on the next
succeeding day on which such stock transfer books are open but such conversion
shall nevertheless be at the conversion price in effect at the close of business
on the date when such Security shall have been so surrendered with the
conversion notice. In the case of conversion of a portion, but less than all, of
a Security, the Company shall execute, and the Trustee shall authenticate and
deliver to the holder thereof, at the expense of the Company, a Security or
Securities in the aggregate principal amount of the unconverted portion of the
Security surrendered. Except as otherwise expressly provided in Section 2.01, no
payment or adjustment shall be made for interest accrued on any Security
converted or for accrued dividends or distributions on any Capital Stock issued
upon conversion of any Security or portion thereof.
SECTION 15.04. Fractional Interests.
No fractions of shares or scrip representing fractions of shares shall be
issued upon conversion of Securities. If more than one Security shall be
surrendered for conversion at one time by the same holder, the number of full
shares which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Securities so surrendered. If any
fraction of a share of Capital Stock would, except for the provisions of this
Section, be issuable on the conversion of any Security or Securities, the
Company shall make payment in lieu thereof in an amount of United States dollars
equal to the
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value of such fraction computed on the basis of the current market price of the
Capital Stock, rounded to the nearest cent. The current market price of a share
of Capital Stock is the closing price reported by the New York Stock Exchange
consolidated transaction reporting system for the last trading day before the
Date of Conversion. In the absence of such a quotation, the Company shall
determine the current market price on the basis of such quotation or quotations
as it considers appropriate. Any determination that the Company or the Board of
Directors makes regarding fractional shares shall be conclusive.
SECTION 15.05. Conversion Price.
The conversion price per share of Capital Stock issuable upon conversion of
the Securities shall be as specified in such Securities.
SECTION 15.06. Adjustment of Conversion Price.
The conversion price (herein called the "Conversion Price") shall be
subject to adjustment from time to time as follows:
(a) In case the Company shall (1) pay a dividend or make a distribution in
shares of Capital Stock, (2) subdivide its outstanding shares of Capital Stock
into a greater number of shares or (3) combine its outstanding shares of Capital
Stock into a smaller number of shares, the Conversion Price in effect
immediately prior to such action shall be adjusted so that the holder of any
Security thereafter surrendered for conversion shall be entitled to receive the
number of shares of Capital Stock which he would have owned immediately
following such action had such Security been converted immediately prior
thereto. An adjustment made pursuant to this subsection (a) shall become
effective immediately, except as provided in subsection (e) below, after the
record date in the case of a dividend and shall become effective immediately
after the effective date in the case of a subdivision or combination. If after
an adjustment a holder upon conversion of the Capital Stock may receive shares
of two or more classes of Capital Stock of the Company, the Company shall
determine the allocation of the adjusted Conversion Price between the classes of
Capital Stock. After such allocation, the conversion privilege and Conversion
Price of each class of Capital Stock shall thereafter be subject to adjustment
on terms comparable to those set forth in this paragraph.
(b) In case the Company shall issue rights or warrants to all holders of
Capital Stock entitling them (for a period not exceeding 45 days from the date
of such issuance) to subscribe for or purchase shares of Capital Stock at a
price per share less than the current market price per share (as determined
pursuant to subsection (d) below) of the Capital Stock on the record date
mentioned below, the Conversion Price shall be adjusted to a price, computed to
the nearest cent, in accordance with the following formula:
N x P
AP = --------------
CP x O + M
where:
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AP = the adjusted Conversion Price.
CP = the current Conversion Price.
O = the number of shares of Capital Stock outstanding on the
record date for the distribution.
N = the number of additional shares of Capital Stock offered.
P = the offering price per share of the additional shares.
M = the current market price per share of Capital Stock on the record
date. Such adjustment shall become effective immediately, except
as provided in subsection (e) below, after the record date for the
determination of holders entitled to receive such rights or
warrants.
(c) In case the Company shall distribute to all holders of Capital Stock,
evidences of indebtedness, equity securities other than Capital Stock or other
assets (other than cash dividends or other distributions to the extent paid from
current or retained earnings of the Company), or shall distribute to all holders
of Capital Stock rights or warrants to subscribe to securities (other than those
referred to in subsection (b) above), then in each such case the Conversion
Price shall be adjusted in accordance with the following formula:
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CP x M - F
AP = -----------
M
where:
AP = the adjusted Conversion Price.
CP = the current Conversion Price.
M = the current market price per share of Capital Stock on the record
date mentioned below.
F = the fair market value on the record date of the assets, securities,
rights or warrants applicable to one share of Capital Stock, as
determined by the Company. Such adjustment shall become effective
immediately, except as provided in subsection (e) below, after the
record date for the determination of stockholders entitled to receive
such distribution.
(d) For the purpose of any computation under subsections (b) and (c) above,
the current market price per share of Capital Stock on any date shall be deemed
to be the average of the closing price of the Capital Stock reported by the New
York Stock Exchange consolidated transaction reporting system for the 30
consecutive trading days commencing 45 trading days before the date of
determination. In the absence of one or more such quotations, the Company shall
determine the current market price on the basis of such quotations as it
considers appropriate.
(e) In any case in which this Section shall require that an adjustment be
made immediately following a record date, the Company may elect to defer the
effectiveness of such adjustment (but in no event until a date later than the
effective time of the event giving rise to such adjustment), in which case the
Company shall, with respect to any Security converted after such record date and
before such adjustment shall have become effective (i) defer paying any cash
payment pursuant to Section 15.04 or issuing to the holder of such Security the
number of shares of Capital Stock and other capital stock of the Company
issuable upon such conversion in excess of the number of shares of Capital Stock
and other capital stock of the Company issuable thereupon only on the basis of
the Conversion Price prior to adjustment, and (ii) not later than five Business
Days after such adjustment shall have become effective, pay to such holder the
appropriate cash payment pursuant to Section 15.04 and issue to such holder the
additional shares of Capital Stock and other capital stock of the Company
issuable on such conversion.
(f) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in such price;
provided that any adjustments which by reason of this subsection (f) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under
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this Article shall be made to the nearest cent or to the nearest one-hundredth
of a share, as the case may be.
(g) Whenever the Conversion Price is adjusted as herein provided, the
Company shall promptly (i) file with the Trustee and each conversion agent an
Officers' Certificate setting forth the Conversion Price after such adjustment
and setting forth a brief statement of the facts requiring such adjustment,
which certificate shall be conclusive evidence of the correctness of such
adjustment, and (ii) mail or cause to be mailed a notice of such adjustment to
each holder of Securities entitled to the benefits of this Article at his
address as the same appears on the registry books of the Company.
Anything in this Section to the contrary notwithstanding the Company shall
be entitled to make such adjustments in the Conversion Price, in addition to
those required by this Section, and to make any election under Treasury
Regulation ss. 1.305-3(d)(2), as it in its discretion shall determine to be
advisable in order that any stock dividend, subdivision of shares, distribution
of rights or warrants to purchase stock or securities, or distribution of other
assets (other than cash dividends) hereafter made by the Company to its
stockholders shall not be taxable.
SECTION 15.07. Continuation of Conversion Privilege in Case of
Reclassification, Change, Merger, Consolidation or Sale of Assets.
If any of the following shall occur, namely: (a) any reclassification or
change of outstanding shares of Capital Stock issuable upon conversion of the
Securities (other than a change in par value, or from par value to no par value,
or from no par value to par value, or as a result of a subdivision or
combination), (b) any consolidation, merger or combination of the Company with
another corporation as a result of which the holders of Capital Stock shall be
entitled to receive stock, other securities or other assets with respect to or
in exchange for Capital Stock or (c) sale or conveyance of all or substantially
all of the property or business of the Company as an entirety as a result of
which the holders of Capital Stock shall be entitled to receive stock, other
securities or other assets with respect to or in exchange for Capital Stock,
then the Company or such successor or purchasing corporation, as the case may
be, shall, as a condition precedent to such reclassification, change,
consolidation, merger, combination, sale or conveyance, execute and deliver to
the Trustee a supplemental indenture (which shall conform to the Trust Indenture
Act of 1939 as in force at the date of the execution thereof) providing that the
holder of each Security then outstanding shall have the right to convert such
Security into the kind and amount of shares of stock and other securities and
property receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance by a holder of the number of shares of Capital
Stock issuable upon conversion of such Security immediately prior to such
reclassification, change, consolidation, merger, combination, sale or
conveyance. Such supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article. If, in the case of any such consolidation, merger,
combination, sale or conveyance, the stock or other securities and property
receivable thereupon by a holder of shares of Capital Stock includes shares of
stock or other securities and property of a
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corporation other than the successor or purchasing corporation, as the case may
be, in such consolidation, merger, combination, sale or conveyance, then such
supplemental indenture shall also be executed by such other corporation and
shall contain such additional provisions to protect the interests of the holders
of the Securities as the Board of Directors shall reasonably consider necessary
by reason of the foregoing. The provisions of this Section shall similarly apply
to successive consolidations, mergers, combinations, sales or conveyances.
Notice of the execution of each such supplemental indenture shall be mailed
to each holder of Securities at his address as the same appears on the registry
books of the Company.
Neither the Trustee nor any conversion agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or securities or property receivable by holders of Securities upon the
conversion of their Securities after any such reclassification, change,
consolidation, merger, sale or conveyance or to any adjustment to be made with
respect thereto, but, subject to the provisions of Sections 7.01 and 7.02, may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, the Officers' Certificate (which the Company
shall be obligated to file with the Trustee prior to the execution of such any
supplemental indenture) with respect thereto.
SECTION 15.08. Notice of Certain Events.
In case:
(a) the Company shall declare a dividend (or any other distribution)
payable to the holders of Capital Stock otherwise than in cash; or
(b) the Company shall authorize the granting to the holders of Capital
Stock of rights to subscribe for or purchase any shares of stock of any class or
of any other rights; or
(c) the Company shall authorize any reclassification or change of the
Capital Stock (other than a subdivision or combination of its outstanding shares
of Capital Stock), or any consolidation or merger to which the Company is a
party and for which approval of any stockholders of the Company is required, or
the sale or conveyance of all or substantially all the property or business of
the Company; then, the Company shall cause to be filed at the office or agency
maintained for the purpose of conversion of the Securities as provided in
Section 4.02, and shall cause to be mailed to each holder of Securities entitled
to the benefits of this Article, at his address as it shall appear on the
registry books of the Company, at least 20 days before the date hereinafter
specified (or the earlier of the dates hereinafter specified, in the event that
more than one date is specified), a notice stating the date on which (1) a
record is expected to be taken for the purpose of such dividend, distribution or
rights, or if a record is not to be taken, the date as of which the holders of
Capital Stock of record to be entitled to such dividend, distribution or rights
are to be determined, or (2) such reclassification, change, consolidation,
merger, sale, conveyance, dissolution, liquidation or winding-up is expected to
become effective and the date, if any is to be fixed, as of which it is
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expected that holders of Capital Stock of record shall be entitled to exchange
their shares of Capital Stock for securities or other property deliverable upon
such reclassification, change, consolidation, merger, sale, conveyance,
dissolution, liquidation or winding-up.
SECTION 15.09. Taxes on Conversion.
The Company will pay any and all documentary, stamp or similar taxes
payable to the United States of America or any political subdivision or taxing
authority thereof or therein in respect of the issue or delivery of shares of
Capital Stock on conversion of Securities pursuant thereto; provided, however,
that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issue or delivery of shares of Capital
Stock in a name other than that of the holder of the Securities to be converted
and no such issue or delivery shall be made unless and until the person
requesting such issue or delivery has paid to the Company the amount of any such
tax or has established, to the satisfaction of the Company, that such tax has
been paid. The Company shall pay no tax that may be payable with respect to any
other taxes imposed in connection with conversion of Securities.
SECTION 15.10. Company to Provide Stock.
The Company shall reserve, free from preemptive rights, out of its
authorized but unissued shares of Capital Stock, sufficient shares to provide
for the conversion of the Securities from time to time as such Securities are
presented for conversion, provided, that nothing contained herein shall be
construed to preclude the Company from satisfying its obligations in respect of
the conversion of Securities by delivery of repurchased shares of Capital Stock
which are held in the treasury of the Company.
If any shares of Capital Stock to be reserved for the purpose of conversion
of Securities hereunder require registration with or approval of any
governmental authority under any federal or state law before such shares may be
validly issued or delivered upon conversion, then the Company covenants that it
will in good faith and as expeditiously as possible endeavor to secure such
registration or approval, as the case may be, provided, however, that nothing in
this Section shall be deemed to affect in any way the obligations of the Company
to convert Securities into Capital Stock as provided in this Article.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the Capital Stock, the
Company will take all corporate action which may, in the Opinion of Counsel, be
necessary in order that the Company may validly and legally issue fully paid and
nonassessable shares of Capital Stock at such adjusted Conversion Price.
The Company covenants that all shares of Capital Stock which may be issued
upon conversion of Securities will upon issue be fully paid and nonassessable by
the Company and free of preemptive rights.
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SECTION 15.11. Disclaimer of Responsibility for Certain Matters.
Neither the Trustee nor any agent of the Trustee shall at any time be under
any duty or responsibility to any holder of Securities to determine whether any
facts exist which may require an adjustment of the Conversion Price, or with
respect to the Officers' Certificate referred to in Section 15.06(g), or with
respect to the nature or extent of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same. Neither the Trustee nor any agent
of the Trustee shall be accountable with respect to the validity or value (or
the kind or amount) of any shares of Capital Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of
any Security; and neither the Trustee nor any conversion agent makes any
representation with respect thereto. Neither the Trustee nor any agent of the
Trustee shall be responsible for any failure of the Company to issue, register
the transfer of or deliver any shares of Capital Stock or stock certificates or
other securities or property upon the surrender of any Security for the purpose
of conversion or, subject to Sections 7.01 and 7.02, to comply with any of the
covenants of the Company contained in this Article.
SECTION 15.12. Return of Funds Deposited for Redemption of Converted
Securities.
Any funds which at any time shall have been deposited by the Company or on
its behalf with the Trustee or any other Paying Agent for the purpose of paying
the principal of and interest on any of the Securities and which shall not be
required for such purposes because of the conversion of such Securities, as
provided in this Article, shall after such conversion be repaid to the Company
by the Trustee or such other Paying Agent.
ARTICLE XVI
MISCELLANEOUS PROVISIONS
SECTION 16.01. Successors and Assigns of Company Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
SECTION 16.02. Acts of Board, Committee or Officer of Successor Corporation
Valid.
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer or officers
of the Company shall and may be done and performed with like force and effect by
the like board, committee or officer or officers of any corporation that shall
at the time be the lawful sole successor of the Company.
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SECTION 16.03. Required Notices or Demands May Be Served by Mail.
Any notice or demand which by any provisions of this Indenture is required
or permitted to be given or served by the Trustee, by the holders of Securities
or by the holders of Preferred Securities to or on the Company may be given or
served by registered mail postage prepaid addressed (until another address is
filed by the Company with the Trustee for such purpose), as follows: The Bear
Stearns Companies Inc., 245 Park Avenue, New York, New York 10167, Attention:
Secretary. Any notice, direction, request, demand, consent or waiver by the
Company, by any Securityholder or by any holder of a Preferred Security to or
upon the Trustee shall be deemed to have been sufficiently given, made or filed,
for all purposes, if given, made or filed in writing at the principal office of
the Trustee, Attention: Corporate Trustee Administration Department.
SECTION 16.04. Officers' Certificate and Opinion of Counsel to Be Furnished
upon Applications or Demands by the Company.
Upon any request or application 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 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, except that in
the case of any such application or demand as to which the furnishing of such
document is specifically required by any provision of this Indenture relating to
such particular application or demand, no additional certificate or opinion need
be furnished.
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, other than certificates provided pursuant to Section 4.06,
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.
Any certificate, statement or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters, upon the certificate, statement or opinion of or
representations by an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows that the certificate, statement or
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opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or Opinion of an officer of the Company or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants, unless such officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to the accounting matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous. Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
SECTION 16.05. Payments Due on Saturdays, Sundays, and Holidays.
Except as otherwise specified as contemplated by Section 2.01, in any case
where the date of payment of interest on or principal of the Securities of any
series or the date fixed for any redemption of any Security of any series shall
not be a Business Day, then payment of interest or principal 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 fixed for the payment of interest on or
principal of the Security or the date fixed for any redemption of any Security
of such series, and no additional interest shall accrue for the period alter
such date and before payment.
SECTION 16.06. Provisions Required by Trust Indenture Act of 1939 to
Control.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed under Sections 310 through 317 of the Trust Indenture Act of
1939, as amended, such duties shall control. If any provision of this Indenture
modifies or excludes any provision of the Trust Indenture Act which may be so
modified or excluded, the latter provision shall be deemed to apply to this
Indenture as so modified or excluded, as the case may be.
SECTION 16.07. Indenture and Securities to be Construed in Accordance with
the Laws of the State of New York.
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 construed
in accordance with the laws of said State, provided, however, that the rights
and duties of the Trustee hereunder shall be construed in accordance with the
laws of the State of the Trustee's principal place of business.
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SECTION 16.08. Provisions of the Indenture and Securities for the Sole
Benefit of the Parties and the Securityholders.
Nothing in this Indenture or in the Securities, expressed or implied, shall
give or be construed to give any person, firm or corporation, other than the
parties hereto and their successors and assigns and the holders of the
Securities, any legal or equitable right, remedy or claim under or in respect of
this Indenture, or under any covenant, condition and provision herein contained;
all its covenants, conditions and provisions being for the sole benefit of the
parties hereto and their successors and assigns and of the holders of the
Securities and, to the extent expressly provided in Sections 6.01, 6.05, 6.06,
9.07, 10.01 and 10.02, the holders of Preferred Securities.
SECTION 16.09. Indenture May be Executed 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 16.10. Securities in Foreign Currencies.
Whenever this Indenture provides for any action by, or any distribution to,
holders of Securities denominated in United States dollars and in any other
currency, in the absence of any provision to the contrary in the form of
Security of any particular series, the relative amount in respect of any
Security denominated in a currency other than United States dollars shall be
treated for any such action or distribution as that amount of United States
dollars that could be obtained for such amount on such reasonable basis of
exchange and as of such date as the Company may specify in a written notice to
the Trustee.
The Chase Manhattan Bank, the party of the second part, hereby accepts the
trusts in this Indenture declared and provided, upon the terms and conditions
hereinabove set forth.
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IN WITNESS WHEREOF, The Bear Stearns Companies Inc., the party of the first
part, has caused this Indenture to be signed by its President and Chief
Executive Officer, and The Chase Manhattan Bank, the party of the second part,
has caused this Indenture to be signed by one of its Vice Presidents, all as of
the day and year first written above.
THE BEAR STEARNS COMPANIES INC.
By:
--------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Trustee
By:
--------------------------------
Name:
Title:
================================================================================
____________ SUPPLEMENTAL INDENTURE
between
THE BEAR STEARNS COMPANIES INC.
and
THE CHASE MANHATTAN BANK
Dated as of _______________, ____
FIXED/ADJUSTABLE RATE JUNIOR SUBORDINATED
DEFERRABLE INTEREST DEBENTURES
DUE ________________, ____
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.01 Definition of Terms...........................................2
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.01 Designation and Principal Amount..............................6
SECTION 2.02 Stated Maturity ..............................................7
SECTION 2.03 Form and Payment; Minimum Transfer Restriction ...............7
SECTION 2.04 Exchange and Registration of Transfer of
Debentures; Depositary .......................................7
SECTION 2.05 Interest .....................................................9
ARTICLE III
REDEMPTION AND PREPAYMENT OF THE DEBENTURES
SECTION 3.01 Optional Redemption by Company...............................10
SECTION 3.02 Special Event Prepayment.....................................10
SECTION 3.03 Notice of Prepayment.........................................11
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.01 Extension of Interest Payment Period.........................11
SECTION 4.02 Notice of Extension..........................................12
ARTICLE V
EXPENSES
SECTION 5.01 Payment of Expenses..........................................12
ARTICLE VI
FORM OF DEBENTURE
SECTION 6.01 Form of Debenture............................................13
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ARTICLE VII
ISSUE OF DEBENTURES
SECTION 7.01 Issue of Debentures..........................................14
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Ratification of Base Indenture; Supplemental Indenture
Controls ....................................................14
SECTION 8.02 Trustee Not Responsible for Recitals.........................14
SECTION 8.03 Governing Law................................................14
SECTION 8.04 Separability.................................................14
SECTION 8.05 Counterparts.................................................15
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__________ SUPPLEMENTAL INDENTURE, dated as of __________, ____ (the
"Supplemental Indenture"), between The Bear Stearns Companies Inc., a Delaware
corporation (the "Company"), and The Chase Manhattan Bank, as trustee (the
"Trustee") under the Indenture dated as of ________ _, ____ between the Company
and the Trustee (the "Base Indenture" and together with all supplements thereto,
the "Indenture").
WHEREAS, the Company executed and delivered the Base Indenture to the
Trustee to provide for the future issuance of the Company's unsecured
subordinated debentures to be issued from time to time in one or more series as
might be determined by the Company under the Indenture, in an unlimited
aggregate principal amount which may be authenticated and delivered as provided
in the Base Indenture;
WHEREAS, pursuant to the terms of the Base Indenture, the Company desires
to provide for the establishment of a new series of its unsecured subordinated
debentures to be known as its Fixed/Adjustable Rate Junior Subordinated
Deferrable Interest Debentures due __________, 20__ (the "Debentures"), the form
and substance of such Debentures and the terms, provisions and conditions
thereof to be set forth as provided in the Base Indenture and this Supplemental
Indenture;
WHEREAS, Bear Stearns Capital Trust __, a Delaware statutory business trust
(the "Trust"), has offered to the underwriters (the "Underwriters") named in
Schedule I to the Underwriting Agreement, dated __________, ____ (the
"Underwriting Agreement"), among the Underwriters, the Trust and the Company
$__________ aggregate liquidation amount of its Fixed/Adjustable Rate Preferred
Securities (the "Preferred Securities"), representing undivided beneficial
interests in the assets of the Trust and proposes to invest the proceeds from
such offering in $______________ aggregate principal amount of the Debentures;
WHEREAS, the Company has requested that the Trustee execute and deliver
this Supplemental Indenture; all requirements necessary to make this
Supplemental Indenture a valid instrument in accordance with its terms, and to
make the Debentures, when executed by the Company and authenticated and
delivered by the Trustee, the valid obligations of the Company, have been
performed; and the execution and delivery of this Supplemental Indenture has
been duly authorized in all respects.
NOW THEREFORE, in consideration of the purchase and acceptance of the
Debentures by the Holders thereof, and for the purpose of setting forth, as
provided in the Base Indenture, the form and substance of the Debentures and the
terms, provisions and conditions thereof, the Company covenants and agrees with
the Trustee as follows:
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01 Definition of Terms.
For all purposes of this Supplemental Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms which are defined in the Base Indenture have the same
meanings when used in this Supplemental Indenture;
(b) the terms defined in this Article have the meaning assigned to them in
this Article and include the plural as well as the singular;
(c) all other terms used herein which are defined in the Trust Indenture
Act, whether directly or by reference therein, have the meanings assigned to
them therein;
(d) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States of America, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with respect to
any computation required or permitted hereunder shall mean such accounting
principles as are generally accepted in the United States of America at the date
of such computation;
(e) a reference to a Section or Article is to a Section or Article of this
Supplemental Indenture;
(f) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Supplemental Indenture as a whole and not to any particular
Article, Section or other subdivision;
(g) headings are for convenience of reference only and do not affect
interpretation; and
(h) the following terms have the meanings given to them in the Trust
Agreement: (i) Affiliate; (ii) Administrators; (iii) Business Day; (iv) Clearing
Agency; (v) Closing Date; (vi) Common Securities; (vii) Delaware Trustee; (viii)
Distribution; (ix) Exchange Act; (x) Guarantee; (xi) Like Amount; (xii) Opinion
of Counsel; (xiii) Preferred Securities; (xiv) Preferred Securities Certificate;
(xv) Property Trustee; and (xvi) Trust Securities.
(i) References herein to the prepayment of the Debentures shall be deemed
to be references to the redemption of the Debentures for the purposes of Article
III of the Base Indenture.
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"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by the Trust on the
outstanding Preferred Securities and Common Securities shall not be reduced as a
result of any additional taxes, duties and other governmental charges to which
the Trust has become subject as a result of a Special Event.
"Adjusted CMT Rate" means, with respect to any prepayment date, the CMT
Rate plus ___%.
"Applicable Rate" with respect to interest on the Debentures shall be the
rate determined by the Calculation Agent on any Applicable Rate Determination
Date to be a rate equal to three-month LIBOR plus ___%. For this purpose, LIBOR
shall be calculated in accordance with the following provisions:
(i) With respect to an Applicable Rate Determination Date, LIBOR
will be determined on the basis of the offered rate for three-month
deposits in U.S. dollars, commencing on the second London Banking Day
immediately following such Applicable Rate Determination Date, which
appears on Telerate page 3750 (or such other page as may replace such
Telerate page 3750 for the purpose of displaying London interbank rates
of major banks), as of 11:00 a.m., London time, on such Applicable Rate
Determination Date. If no rate appears on Telerate page 3750 (or such
other page as may replace such page), LIBOR in respect of that
Applicable Rate Determination Date will be determined as if the parties
had specified the rate described in (ii) below.
(ii) With respect to an Applicable Rate Determination Date on
which no offered rate appears on Telerate page 3750 (or such other
page), as applicable, as described in (i) above, LIBOR will be
determined on the basis of the rates at approximately 11:00 a.m.,
London time, on such Applicable Rate Determination Date at which
three-month deposits in U.S. dollars are offered to prime banks in the
London interbank market by four major banks in the London interbank
market selected by the Calculation Agent commencing on the second
London Banking Day immediately following such Applicable Rate
Determination Date and in a principal amount equal to an amount of not
less than $1,000,000 that is representative of a single transaction in
such market at such time. The Calculation Agent will request the
principal London office of each of such banks to provide a quotation of
its rate. If at least two such quotations are provided, LIBOR for such
Applicable Rate Determination Date will be the arithmetic mean of such
quotations. If fewer than two quotations are provided, LIBOR for such
Applicable Rate Determination Date will be the arithmetic mean of the
rates quoted at approximately 11:00 a.m., New York City time, on such
Applicable Rate Determination Date by three major banks in the City of
New York, selected by the Calculation Agent for loans in U.S. dollars
to leading European banks, having a maturity of three months and
commencing on the second London Banking Day immediately following such
Applicable Rate Determination Date and in a principal amount equal to
an amount of not less than $1,000,000 that is representative of a
single
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transaction in such market at such time; provided, however, that if the
banks selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, LIBOR will be LIBOR in effect on such
Applicable Rate Determination Date, provided further, however, that if
the banks selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence and such Applicable Rate
Determination Date is prior to _____________, 20__ or prior to the
first Applicable Rate Determination Date on which LIBOR can be
determined as aforesaid, the Applicable Rate for the following
Applicable Rate Reset Date shall be the Coupon Rate.
"Applicable Rate Determination Date" shall mean the second London Banking
Day preceding each Applicable Rate Reset Date.
"Applicable Rate Reset Date" shall mean _____________, 20__ and the 15th of
each _____________, _____________, _____________ and __________ thereafter until
_____________, 20__.
"Calculation Agent" means ____________________.
"CMT Rate" will be determined by the Calculation Agent in accordance with
the following provisions:
(i) the CMT Rate will be determined on the basis of the latest
rate displayed at the close of business 10 Business Days before the
date of a Special Event Prepayment on (x) Telerate page 7055 for
"Yields on Treasury Constant Maturities -- Federal Reserve Board
Statistical Release H.15(519) -- Mondays approximately 3:45 p.m. EST"
(or "EDT" as the case may be) for U.S. Treasury Securities with a
maturity corresponding to the Remaining Life (or if no maturity is
within three months before or after the Remaining Life, yields for the
two published maturities most closely corresponding to the Remaining
Life shall be determined and the CMT Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounded to the
nearest month), or (y) such other page as may replace page 7055, as
provided by the Telerate News Service, for the purpose of displaying
rates or prices that are comparable, as determined by the Calculation
Agent (after consultation with the Company), to the Constant Maturity
Treasury rates formerly displayed on Telerate page 7055;
(ii)if the information specified in subparagraph (i) above is not
available at the date 10 Business Days before such Special Event
Prepayment, then the CMT Rate shall be determined on the basis of the
Treasury Constant Maturity rate with a maturity corresponding to the
Remaining Life (adjusted as aforesaid) (or other United States Treasury
rate, with a maturity that is closest to ____________, 20__) published
as of that date by either the Board of Governors of the Federal Reserve
System or the United States Department of the Treasury that the
Calculation Agent (after consultation with the Company) determines to
be comparable to the rate formerly displayed on Telerate page 7055 and
published in the Federal Reserve Board Statistical Release H.15 (519);
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(iii) if the information specified in subparagraphs (i) and (ii)
is not available at the date 10 Business Days before the date of such
Special Event Prepayment then the CMT Rate shall be the yield to
maturity of the then most recently issued direct non-callable fixed
rate United States Treasury Note with an original maturity
corresponding to the Remaining Life (adjusted as aforesaid) (the
"Reference Treasury Note"), such yield to maturity to be calculated by
the Calculation Agent on the basis of the arithmetic mean of the
secondary market bid side prices for such Reference Treasury Note
quoted as of 3:00 p.m., New York City time (or the closing of the
market, if earlier), on the date 10 Business Days before the date of
such Special Event Prepayment, by (and appearing in the written records
of) three leading primary United States government securities dealers
in New York City selected by the Calculation Agent; and
(iv) if the information specified in subparagraphs (i) and (ii)
above is not available at the date 10 Business Days before such Special
Event Prepayment and at least three price quotations for the Reference
Treasury Note are not available at that date from leading primary
dealers in New York City as provided in subparagraph (iii) above, then
the CMT Rate shall be the yield to maturity of the Reference Treasury
Note, as calculated by the Calculation Agent on the basis of the
arithmetic mean of the secondary market bid side prices for such
Reference Treasury Note quoted as of 3:00 p.m., New York City time (or
the closing of the market, if earlier), on that date, by (and appearing
in the written records of) any three primary United States government
securities dealers selected by the Calculation Agent (irrespective of
where such dealers may be located).
"Compounded Interest" shall have the meaning specified in Section 4.01.
"Coupon Rate" has the meaning specified in Section 2.05.
"Deferred Interest" has the meaning specified in Section 4.01.
"Extension Period" has the meaning specified in Section 4.01.
"Global Debenture" has the meaning specified in Section 2.04.
"Investment Company Event" means the receipt by the Trust of an Opinion of
Counsel to the effect that, as a result of the occurrence of a change in law or
regulation or a change (including any announced proposed 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,
which change or proposed change becomes effective or would become effective, as
the case may be, on or after the date of the issuance of the Preferred
Securities of the Trust.
"Liquidation Amount" means the stated amount of $_____ per Preferred
Security.
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"London Banking Day" shall mean any day on which dealings in deposits in
U.S. dollars are transacted in the London interbank market.
"Optional Redemption Price" has the meaning specified in Section 3.01.
"Prepayment Date" has the meaning specified in Section 3.01.
"Remaining Life" has the meaning specified in Section 3.02.
"Special Event" means an Investment Company Event or a Tax Event.
"Special Event Prepayment" means the prepayment of the Debentures upon the
occurrence and continuation of a Special Event.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel 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
Closing Date, 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 Company on the Debentures 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) the Trust is,
or will be within 90 days of the date of such opinion, subject to more than a de
minimis amount of taxes, duties or other governmental charges.
"Trust Agreement" means the Amended and Restated Trust Agreement of the
Trust, dated as of ________________, ____.
"Underwriters" has the meaning specified in the third recital to this
Supplemental Indenture.
"Underwriting Agreement" has the meaning specified in the third recital to
this Supplemental Indenture.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE DEBENTURES
SECTION 2.01 Designation and Principal Amount.
The aggregate principal amount of Debentures outstanding at any time shall
not exceed $__________ (except as set forth in Section 2.01(2) of the Base
Indenture). Upon receipt of a written order of the Company (executed as required
by Section 2.01 of the Base Indenture) for the authentication and delivery of a
series of Debentures and satisfaction of the
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requirements of the fifth paragraph of Section 2.01 of the Base Indenture, the
Trustee shall authenticate Debentures for original issuance in an aggregate
principal amount not to exceed $__________ (except as set forth in Section
2.01(2) of the Base Indenture).
SECTION 2.02 Stated Maturity.
The Stated Maturity of the Debentures is __________, 20__ and shall not be
subject to extension.
SECTION 2.03 Form and Payment; Minimum Transfer Restriction.
(a) Except as provided in Section 2.04, the Debentures shall be issued to
the Trust and held by the Property Trustee in fully registered certificated form
without coupons in minimum denominations of $1,000 and integral multiples of
$1,000 in excess thereof. Principal and interest on the Debentures issued in
certificated form will be payable, the transfer of such Debentures will be
registrable and such Debentures will be exchangeable for Debentures bearing
identical terms and provisions at the principal office of the Trustee; provided,
however, that payment of interest may be made at the option of the Company (i)
by check mailed to the registered holder at such address as shall appear in the
Register or (ii) by transfer to an account maintained by such Person as
specified in such Register, provided that proper transfer instructions have been
received by the preceding record date. Notwithstanding the foregoing, so long as
the registered holder of any Debentures is the Property Trustee, the payment of
the principal of and interest (including Additional Sums, Additional Interest
and Compounded Interest, if any) on such Debentures held by the Property Trustee
will be made at such place and to such account as may be designated by the
Property Trustee.
(b) The Debentures may be transferred or exchanged only in minimum
denominations of $1,000 and integral multiples of $1,000 in excess thereof; and
any attempted transfer, sale or other disposition of Debentures in a
denomination of less than $1,000 shall be deemed to be void and of no legal
effect whatsoever (the foregoing restriction being the "Minimum Transfer
Restriction").
SECTION 2.04 Exchange and Registration of Transfer of Debentures;
Depositary.
If an early dissolution of the Trust occurs as described in the Trust
Agreement and Debentures are to be distributed to the holders of the Preferred
Securities, a Like Amount of the Debentures will be issued to holders of the
Trust Securities in the same form as the Trust Securities that such Debentures
replace in accordance with the following procedures:
(a) So long as Debentures are eligible for book-entry settlement with the
Depositary, or unless otherwise required by law, all Debentures that are so
eligible may be represented by one or more Debentures in global form registered
in the name of Cede & Co. the nominee of the Depositary, except as otherwise
specified below. The transfer and exchange of beneficial interests in any such
Debenture in global form shall be shown on, and
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transfers thereof will be effected only through, records maintained by
participants in the Depositary.
Debentures that are distributed in replacement of Preferred Securities
represented by a global Preferred Security will be represented by a global
Debenture (the "Global Debenture").
Except as provided below, beneficial owners of a Debenture in global form
shall not be entitled to have certificates registered in their names, will not
receive or be entitled to receive physical delivery of certificates in
definitive form and will not be considered registered holders of such Debentures
in global form.
(b) Trust Securities held in certificated form, except for certificates
representing Preferred Securities held by Cede & Co. as nominee of the
Depositary (or any successor Clearing Agency or its nominee), shall upon
presentation to the Trustee by the Property Trustee or by the holder thereof or
by the Property Trustee on behalf of such holders be exchanged for a Like Amount
of Debentures in fully registered certificated form.
(c) Any Global Debenture may be endorsed with or have incorporated in the
text thereof such legends or recitals or changes not inconsistent with the
provisions of the Indenture as may be required by the Depositary or required to
comply with the rules and regulations of any exchange, interdealer quotation
system or self-regulatory organization upon which the Debentures may be listed
or traded or to conform with any usage with respect thereto, or to indicate any
special limitations or restrictions to which any particular Debentures are
subject.
(d) Notwithstanding any other provisions of the Indenture (other than the
provisions set forth in this Section 2.04(d)), a Debenture in global form may
not be exchanged in whole or in part for Debentures registered, and no transfer
of a Debenture in global form may be registered, in the name of any person other
than Cede & Co. unless (i) the Depositary (A) has notified the Company that it
is unwilling or unable to continue as Depositary for such Global Debenture or
(B) has ceased to be a clearing agency registered as such under the Exchange
Act, (ii) there shall have occurred and be continuing an Event of Default, or
any event which after notice or lapse of time or both would be an Event of
Default under the Indenture, with respect to such Global Debenture, or (iii) the
Company in its sole discretion instructs the Trustee to exchange such Global
Debenture for a Debenture that is not a Global Debenture (in which case such
exchange shall be effected by the Trustee).
The Depositary shall be a clearing agency registered under the Exchange
Act. The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Debentures in global form. Initially, the Global
Debentures shall be issued to the Depositary, registered in the name of Cede &
Co., as the nominee of the Depositary, and deposited with the Trustee as
custodian for Cede & Co.
If at any time the Depositary for the Global Debentures notifies the
Company that it is unwilling or unable to continue as Depositary for such
Debentures or has ceased to be
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a Clearing Agency registered as such under the Exchange Act, the Company may
appoint a successor Depositary with respect to such Debentures. If a successor
Depositary for the Debentures is not appointed by the Company within 90 days
after the Company receives such notice or becomes aware of such ineligibility,
the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate for authentication and delivery of Debentures, will authenticate and
deliver, Debentures in definitive form, in an aggregate principal amount equal
to the principal amount of the Global Debentures, in exchange for the such
Global Debentures.
Definitive Debentures issued in exchange for all or a part of a Global
Debenture pursuant to this Section 2.04(d) 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. Upon execution and authentication, the Trustee shall deliver such
definitive Debentures to the person in whose names such definitive Debentures
are so registered.
At such time as all interests in a Global Debenture have been redeemed,
exchanged, repurchased or canceled, such Global Debenture shall be, upon receipt
thereof, canceled by the Trustee in accordance with standing procedures and
instructions of the Depositary. At any time prior to such cancellation, if any
interest in a Global Debenture is exchanged for definitive Debentures, redeemed,
exchanged, or canceled, or transferred for part of a Global Debenture, the
principal amount of such Global Debenture shall, in accordance with the standing
procedures and instructions of the Depositary be reduced, and an endorsement
shall be made on such Global Debenture by, or at the direction of, the Trustee
to reflect such reduction.
SECTION 2.05 Interest.
(a) Each Debenture will bear interest at the rate (the "Coupon Rate") of
___% per annum until ____________, 20__, and at the Applicable Rate thereafter,
until the principal thereof becomes due and payable, and on any overdue
principal and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the Coupon Rate or the
Applicable Rate, as the case may be, compounded semiannually, payable (subject
to the provisions of Article 4) semiannually in arrears on the __________ day of
__________ and __________ of each year (each, an "Interest Payment Date"),
commencing on _________, ____ to the Person in whose name such Debenture is
registered, subject to certain exceptions, at the close of business on the
Business Day next preceding such Interest Payment Date. If the Debentures are
issued in certificated form (other than to the Property Trustee), the record
dates for payment of interest will be the _____ day of the month [immediately
prior to the month] in which the relevant Interest Payment Date occurs. Until
liquidation, if any, of the Trust, each Debenture will be held in the name of
the Property Trustee in trust for the benefit of the holders of the Trust
Securities. The Company shall notify the Trustee of the Applicable Rate, as soon
as practicable after each calculation thereof.
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(b) The amount of interest payable for any period will be computed on the
basis of a 360-day year of twelve 30-day months until ____________, 20__ and
thereafter on the basis of a 360-day year and the actual number of days elapsed.
In the event that any date on which interest is payable on the Debentures 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, except that, if such Business
Day is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable. Until ____________,
20__, in the event that any Interest Payment Date is not a Business Day,
interest will be paid on the next succeeding Business Day (subject as
aforesaid), without any interest or other payment with respect to any such
delay. After ___________, 20__, interest shall be the amount of interest accrued
from, and including, the last date on which interest has previously been paid,
to, but excluding, the Interest Payment Date (or if such date is not a Business
Day, the next succeeding Business Day (subject as aforesaid)).
ARTICLE III
REDEMPTION AND PREPAYMENT OF THE DEBENTURES
SECTION 3.01 Optional Redemption by Company.
Subject to the provisions of Article III of the Base Indenture, except as
otherwise may be specified in Section 3.02 or elsewhere in this Supplemental
Indenture, the Company shall have the right to prepay the Debentures, in whole
or in part, from time to time, on or after ____________, 20__, at a prepayment
price (the "Optional Redemption Price") equal to the outstanding principal
amount of the Debentures plus, in each case, accrued and unpaid interest,
including Additional Sums, Additional Interest and Compounded Interest thereon
to the date of prepayment (the "Prepayment Date"):
If the Debentures are only partially prepaid pursuant to this Section 3.01,
the Debentures will be selected for prepayment by any method utilized by the
Trustee. The Optional Redemption Price, together with any required interest
payment, shall be paid prior to 12:00 Noon, New York City time, on the
Prepayment Date or at such earlier time as the Company determines provided that
the Company shall deposit with the Trustee an amount sufficient to pay the
Optional Redemption Price, together with any required interest payment, by 10:00
a.m., New York City time, on the date such amounts are to be paid.
SECTION 3.02 Special Event Prepayment.
If a Special Event shall occur and be continuing, the Company may, at its
option, prepay the Debentures in whole (but not in part) at any time within 90
days of the occurrence of such Special Event, at a prepayment price (the
"Special Event Prepayment Price") equal to the greater of (i) 100% of the
principal amount of such Debentures or (ii) as determined by a Calculation
Agent, the sum of the present values of the principal amount that would be
payable as part of the Optional Redemption Price pursuant to Section 3.01 with
respect to an optional prepayment of such Debentures on _____________, 20__,
together with
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the present values of scheduled payments of interest from the Prepayment Date to
_____________, 20__ (the "Remaining Life"), in each case discounted to the
Prepayment Date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted CMT Rate, plus, in each case, accrued and
unpaid interest including Additional Sums, Additional Interest and Compounded
Interest thereon to but excluding the Prepayment Date, provided that with
respect to any prepayment under this Section 3.02 of Debentures as a result of a
Special Event that occurs on or after _____________, 20__ the Special Event
Prepayment Price shall be an amount equal to the Optional Redemption Price that
would be payable on optional redemption of the Debentures on the Prepayment Date
(including accrued and unpaid interest, Additional Sums, Additional Interest and
Compounded Interest to the Prepayment Date). The Company shall notify the
Trustee of the Special Event Prepayment Price, as soon as practicable after the
calculation thereof.
SECTION 3.03 Notice of Prepayment.
Subject to Article III of the Base Indenture, notice of any prepayment will
be mailed at least 30 days but not more than 60 days before the redemption date
to each holder of Debentures to be prepaid at its registered address. Unless the
Company defaults in payment of the Prepayment Price, on and after the Prepayment
Date interest ceases to accrue on such Debentures called for prepayment.
If the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a Special Event, the Company will also pay
any Additional Sums on the Debentures.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.01 Extension of Interest Payment Period.
So long as an Event of Default under Section 6.01 of the Base Indenture
shall not have occurred and be continuing, the Company shall have the right,
subject to the provisions of Section 2.10 of the Base Indenture, at any time and
from time to time during the term of the Debentures, to defer payments of
interest by extending the interest payment period of such Debentures for a
period not exceeding ____ consecutive semi-annual periods (the "Extension
Period"), during which Extension Period no interest shall be due and payable;
provided that no Extension Period shall end on a date other than an Interest
Payment Date or extend beyond the Stated Maturity or any earlier redemption
date. To the extent permitted by applicable law, interest, the payment of which
has been deferred because of the extension of the interest payment period
pursuant to this Section 4.01, will bear interest thereon at the Coupon Rate
compounded semiannually ("Compounded Interest"). At the end of the Extension
Period, the Company shall pay all interest accrued and unpaid on the Debentures,
including any Additional Sums, Additional Interest and Compounded Interest
(together, "Deferred Interest") to the holders of the Debentures in whose names
the Debentures are registered in the Register on the first record date preceding
the end of the Extension Period.
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Before the termination of any Extension Period, the Company may further extend
such period, provided that such period together with all such further extensions
thereof shall not exceed 10 consecutive semi-annual periods, or extend beyond
the Stated Maturity or any earlier redemption date. Upon the termination of any
Extension Period and upon the payment of all Deferred Interest then due, the
Company may commence a new Extension Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extension Period,
except at the end thereof, but the Company may prepay at any time all or any
portion of the interest accrued during an Extension Period.
SECTION 4.02 Notice of Extension.
(a) If the Property Trustee is the only registered holder of the Debentures
at the time the Company selects (or extends) an Extension Period, the Company
shall give written notice to the Administrators, the Property Trustee and the
Trustee of its selection (or extension) of such Extension Period at least five
Business Days before the earlier of (i) the next succeeding date on which
Distributions on the Preferred 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 applicable exchange, interdealer
quotation system or self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event not less than five Business
Days before such record date. The Property Trustee shall give notice of the
Company's election to begin or extend a new Extension Period to the holders of
the Preferred Securities.
(b) If the Property Trustee is not the only holder of the Debentures at the
time the Company selects (or extends) an Extension Period, the Company shall
give the holders of the Debentures and the Trustee written notice of its
selection (or extension) of such Extension Period at least 10 Business Days
before the earlier of (i) the next succeeding Interest Payment Date or (ii) the
date the Company is required to give notice of the record or payment date of
such interest payment to any applicable self-regulatory organization or to
holders of the Debentures.
(c) The semi-annual period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 4.02 shall be counted as one of the ____
consecutive semi-annual periods permitted in the maximum Extension Period
permitted under Section 4.01.
ARTICLE V
EXPENSES
SECTION 5.01 Payment of Expenses.
In connection with the offering, sale and issuance of the Debentures to the
Property Trustee and in connection with the sale of the Preferred Securities by
the Trust, the Company, in its capacity as borrower with respect to the
Debentures, shall:
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(a) pay all costs and expenses relating to the offering, sale and issuance
of the Debentures, including commissions to the Underwriters payable pursuant to
the Underwriting Agreement and compensation of the Trustee under the Indenture
in accordance with the provisions of Section 7.06 of the Base Indenture;
(b) pay all costs and expenses of the Trust (including, without limitation,
costs and expenses relating to the organization of the Trust, the fees and
expenses of the Property Trustee and the Delaware Trustee, the costs and
expenses relating to the operation of the Trust, including, without limitation,
costs and expenses of accountants, attorneys, statistical or bookkeeping
services, expenses for printing and engraving and computing or accounting
equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel
and telephone and other telecommunications expenses and costs and expenses
incurred in connection with the acquisition, financing, and disposition of Trust
assets);
(c) pay all costs and expenses related to the enforcement by the Property
Trustee of the rights of the registered holders of the Preferred Securities;
(d) be primarily liable for any indemnification obligations arising with
respect to the Trust Agreement or the Underwriting Agreement; and
(e) pay any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and expenses
with respect to such taxes of the Trust.
SECTION 5.02 Payment upon Resignation or Removal.
Upon termination of this Supplemental Indenture or the Base Indenture or
the removal or resignation of the Trustee pursuant to Section 7.10 of the Base
Indenture, the Company shall pay to the Trustee all amounts accrued to the date
of such termination, removal or resignation. Upon termination of the Trust
Agreement or the removal or resignation of the Delaware Trustee or the Property
Trustee, as the case may be, pursuant to Section 8.10 of the Trust Agreement,
the Company shall pay to the Delaware Trustee or the Property Trustee, and their
respective counsel, as the case may be, all amounts accrued to the date of such
termination, removal or resignation.
ARTICLE VI
FORM OF DEBENTURE
SECTION 6.01 Form of Debenture.
The Debentures and the Trustee's Certificate of Authentication to be
endorsed thereon are to be substantially in the form attached hereto as Exhibit
A.
-13-
<PAGE>
ARTICLE VII
ISSUE OF DEBENTURES
SECTION 7.01 Issue of Debentures.
Debentures in the aggregate principal amount of up to $__________ may, upon
execution of this Supplemental Indenture, be executed by the Company and
delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and make available for delivery said Debentures to or upon the
written order of the Company, signed by its Chairman of the Board, any Vice
Chairman of the Board, the President, any Vice Chairman, any Executive Vice
President, the Chief Operating Officer or the Chief Financial Officer and by its
Treasurer or Assistant Treasurer, Controller or the Secretary or an Assistant
Secretary without any further action by the Company, except as otherwise
provided in Section 2.01 of the Base Indenture.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Ratification of Base Indenture; Supplemental Indenture
Controls.
The Base Indenture, as supplemented by this Supplemental Indenture, is in
all respects ratified and confirmed, and this Supplemental Indenture shall be
deemed part of the Base Indenture in the manner and to the extent herein and
therein provided. The provisions of this Supplemental Indenture shall supersede
the provisions of the Base Indenture to the extent the Indenture is inconsistent
herewith.
SECTION 8.02 Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and not by the
Trustee, and the Trustee assumes no responsibility for the correctness thereof.
The Trustee makes no representation as to the validity or sufficiency of this
Supplemental Indenture.
SECTION 8.03 Governing Law.
THIS SUPPLEMENTAL INDENTURE AND EACH DEBENTURE SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE INTERNAL 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 LAW PRINCIPLES THEREOF.
SECTION 8.04 Separability.
In case any one or more of the provisions contained in this Supplemental
Indenture or in the Debentures shall for any reason be held to be invalid,
illegal or
-14-
<PAGE>
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Supplemental Indenture or of the
Debentures, but this Supplemental Indenture and the Debentures shall be
construed as if such invalid or illegal or unenforceable provision had never
been contained herein or therein.
SECTION 8.05 Counterparts.
This Supplemental 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.
-15-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed on the date or dates indicated in the
acknowledgments and as of the day and year first above written.
THE BEAR STEARNS COMPANIES INC.
By:
--------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Trustee
By:
--------------------------------
Name:
Title:
<PAGE>
EXHIBIT A
FIXED/ADJUSTABLE RATE JUNIOR SUBORDINATED
DEFERRABLE INTEREST DEBENTURE
DUE _____________, 20__
Registered No. __________
Dated: ____________ CUSIP __________
Registered Holder: [The Chase Manhattan Bank, as Property Trustee of Bear
Stearns Capital Trust __]*
The Bear Stearns Companies Inc., a corporation duly organized and existing
under the laws of the State of Delaware (herein referred to as the "Company,"
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to the Registered
Holder named above, the principal sum [of __________ Dollars ($_____)]**
[specified in the Schedule annexed hereto]***, on __________, 20__ in such coin
or currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debt. The Company further promises
to pay to the registered holder hereof as hereinafter provided (a) interest on
said principal sum (subject to deferral as set forth herein) at the rate of ___%
per annum, until _____________, 20__ (the "Coupon Rate") and thereafter at the
Applicable Rate (as defined in the Indenture referred to below) per annum
(determined as provided in the Indenture), in like coin or currency,
semiannually in arrears on the __________ day of _________ and _________ (each
an "Interest Payment Date") commencing __________, ____ from the date next
preceding the date hereof to which interest has been paid or duly provided for
(unless (i) no interest has yet been paid or duly provided for on this debenture
(the "Debenture"), in which case from the date of original issuance, or (ii) the
date hereof is before an Interest Payment Date but after the related Record Date
(as defined below), in which case from such following Interest Payment Date or
next succeeding Business Day to which interest shall have been paid; provided,
however, that if the Company shall default in payment of the interest due on
such following Interest Payment Date or Business Day, then from the next
preceding date to which interest has been paid or duly provided for), until the
principal hereof shall become due and payable, plus (b) interest on overdue
principal and, to the extent permitted by applicable law, on any interest
payment that is not made when due at the Coupon Rate or the Applicable Rate, as
the case may be, compounded semiannually. The interest so payable will, subject
to certain exceptions provided in the Indenture hereinafter referred to, be paid
to the person in whose name this Debenture is registered at the close of
business on the Record Date next preceding such Interest Payment Date. The
Record Date shall be the Business Day next preceding the Interest Payment Date,
unless this Certificate is registered to a holder other than
A-1
<PAGE>
the Property Trustee or a nominee of The Depository Trust Company, in which case
the Record Date will be the _____ day of the _____ month [immediately prior to
the month] in which the relevant Interest Payment Date occurs. This Debenture
may be presented for payment of principal and interest at the offices of The
Chase Manhattan Bank, as paying agent for the Company, maintained for that
purpose in the Borough of Manhattan, The City of New York, State of New York;
provided, however, that payment of interest may be made at the option of the
Company (i) by check mailed to such address of the person entitled thereto as
the address shall appear on the Register of the Debentures or (ii) by transfer
to an account maintained by the Person entitled thereto as specified in the
Register, provided that proper transfer instructions have been received by the
Record Date. Interest on the Debenture will be computed on the basis of a
360-day year of twelve 30-day months until _____________, 20__ and thereafter on
the basis of a 360-day year and the actual number of days elapsed. In the event
that any date on which interest is payable on the Debentures 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, except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date such payment was originally payable. Until _____________, 20__, in
the event that any Interest Payment Date is not a Business Day, interest will be
paid on the next succeeding Business Day (subject as aforesaid), without any
interest or other payment with respect to any such delay. After _____________,
20__, interest shall be the amount of interest accrued from, and including, the
last date on which interest has previously been paid, to, but excluding, the
Interest Payment Date (or if such date is not a Business Day, the next
succeeding Business Day (subject as aforesaid)).
So long as no Event of Default has occurred and is continuing, the Company
shall have the right, at any time during the term of this Debenture to defer
payment of interest on this Debenture, at any time or from time to time, for up
to ___ consecutive semi-annual interest payment periods with respect to each
deferral period (each an "Extension Period"), during which Extension Periods the
Company shall have the right to make partial payments of interest on any
Interest Payment Date; provided, however, that no Extension Period shall end on
a date other than an Interest Payment Date or extend beyond ____________, 20__
or any earlier redemption date. At the end of each Extension Period, the Company
must pay all interest then accrued and unpaid (together with Additional Sums,
Additional Interest and Compounded Interest thereon, if any, to the extent
permitted by applicable law). During any such Extension Period, the Company
shall not, and shall not permit any Subsidiary of the Company to, (i) declare or
pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any shares of the Company's capital stock
(which includes common and preferred stock), or (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities of the Company that rank pari passu with or junior in
interest to this Debenture or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any Subsidiary of the Company
that by its terms ranks pari passu with or junior in interest to this Debenture
(other than (a) dividends or distributions in capital stock of the Company; (b)
any declaration of a dividend in connection with the implementation of a Rights
Plan, or the issuance of capital stock of the Company under any Rights Plan, or
the redemption or
A-2
<PAGE>
repurchase of any rights distributed pursuant to a Rights Plan; (c) payments
under any Bear Stearns Guarantee (as defined in the Indenture and the Existing
Indenture); (d) 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; and (e) payments of interest pursuant to the EPICS Loan
Agreement). Prior to the termination of any such Extension Period, the Company
may further extend the interest payment period, provided that no Extension
Period shall exceed ___ consecutive semi-annual periods or extend beyond
_____________, 20__ or any earlier redemption date. At any time following the
termination of any Extension Period and the payment of all accrued and unpaid
interest (including Additional Sums, Additional Interest and Compounded
Interest, if any) then due, the Company may elect to begin a new Extension
Period, subject to the above requirements. No interest shall be due and payable
during an Extension Period, except at the end thereof. The Company shall give
the Trustee and the Property Trustee notice of its election to begin or extend
any Extension Period at least five Business Days prior to the earlier of (i) the
next succeeding date on which Distributions on the Preferred Securities issued
by Bear Stearns Capital Trust __ would be payable but for such election to begin
or extend a new Extension Period, or (ii) the date the Property Trustee is
required to give notice to any applicable self-regulatory organization or to
holders of such 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.
This Debenture is issued pursuant to an Indenture, dated as of ________ _,
____ between the Company, as issuer, and The Chase Manhattan Bank, a banking
corporation duly organized and existing under the laws of the State of New York,
as trustee, as supplemented (as further supplemented or amended from time to
time, the "Indenture"). Reference is made to the Indenture for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the Holders (the word "Holder" or
"Holders" meaning the registered holder or registered holders) of the
Debentures. Terms used herein which are defined in the Indenture shall have the
respective meanings assigned thereto in the Indenture. By acceptance of this
Debenture, the Holder hereof agrees to be bound by the provisions of the
Indenture.
The Debentures are limited to the aggregate principal amount of
__________________________________ Dollars ($_________).
The Debentures evidenced by this Certificate may be transferred or
exchanged only in minimum denominations of $1,000 and integral multiples of
$1,000 in excess thereof, and any attempted transfer, sale or other disposition
of Debentures in a denomination of less than $1,000 shall be deemed to be void
and of no legal effect whatsoever.
The indebtedness of the Company evidenced by the Debentures, including the
principal thereof and interest thereon, is, to the extent and in the manner set
forth in the Indenture, subordinate and junior in right of payment to its
obligations to Holders of Senior Indebtedness of the Company and each Holder of
a Debenture, by acceptance thereof, agrees to and shall be bound by such
provisions of the Indenture and all other provisions of the Indenture.
A-3
<PAGE>
This Debenture shall not 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 under the Indenture.
- -------------
* Insert in Debenture held by Property Trustee only.
** Insert in definitive Debenture only.
*** Insert in global Debenture only.
A-4
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be signed,
manually or in facsimile, by its Chairman of the Board, any Vice Chairman of the
Board, the President, any Vice Chairman, any Executive Vice President, the Chief
Operating Officer or the Chief Financial Officer and by its Treasurer or
Assistant Treasurer, Controller or the Secretary or an Assistant Secretary and a
facsimile of its corporate seal to be affixed hereunto.
THE BEAR STEARNS COMPANIES INC.
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
[SEAL]
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities, of the series designated therein, referred
to in the within-mentioned Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:
------------------------------------
Authorized Officer
A-5
<PAGE>
[REVERSE OF DEBENTURE]
As provided in and subject to the provisions of the Indenture, if an Event
of Default with respect to the payment of principal or interest on the
Debentures or with respect to compliance with certain covenants occurs and is
continuing, then in every such case the Trustee or the Holders of not less than
25% in principal amount of the then outstanding Debentures may declare the
principal amount of all the Debentures, together with any accrued interest
(including Additional Sums, Additional Interest and Compounded Interest), to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee, if such notice is given by Holders). If the Debentures have been issued
to a Bear Stearns Trust, upon such an Event of Default, if the Trustee or the
Holders of not less than 25% in principal amount of the outstanding Debentures
fails to declare the principal of all the Debentures to be immediately due and
payable, the holders of at least 25% in aggregate Liquidation Amount of the
corresponding Preferred Securities of such Bear Stearns Trust then outstanding
shall have such right by a notice in writing to the Company and the Trustee, and
upon such declaration the principal amount of and the accrued interest
(including any Additional Sums, Additional Interest and Compounded Interest) on
all the Debentures shall become immediately due and payable, provided that the
payment of principal and interest on such Debentures shall remain subordinated
to the extent provided in the Indenture.
If an Event of Default with respect to certain covenants applicable to all
series of securities issued under the Indenture (collectively, the
"Securities"), or with respect to events of bankruptcy, insolvency or
reorganization of the Company occurs and is continuing, then and in every such
case the Trustee or the Holders of not less than 25% in principal amount of all
Securities outstanding under the Indenture (voting as a single class) may
declare the principal amount of all such Securities to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if such
notice is given by Holders), provided that, in the case of Securities of a
series issued under the Indenture to a Bear Stearns Trust, if upon such an Event
of Default the Trustee and the Holders of not less than 25% in principal amount
of all outstanding Securities of that series fail to declare the principal of
all the Securities of that series to be immediately due and payable, the holders
of at least 25% in aggregate Liquidation Amount of the corresponding Preferred
Securities of such Bear Stearns Trust then outstanding shall have such right by
a notice in writing to the Company and the Trustee; and upon any such
declaration the principal amount of and the accrued interest (including any
Additional Sums, Additional Interest and Compounded Interest) on all the
Securities of that series shall become immediately due and payable, provided
that the payment of principal and interest shall remain subordinated to the
extent provided in the Indenture.
The Indenture provides that in certain events such declaration that
principal and accrued interest are due and payable, and the consequences of such
declaration, may be rescinded and annulled by the holders of a majority in
principal amount of the Securities then outstanding under the Indenture as to
which such an acceleration of the payment of principal has occurred, voting as
one class. In the case of Securities of a series issued under the Indenture to a
Bear Stearns Trust, should the Holders of Securities of that series fail to
rescind and annul such declaration and its consequences, the Holders of a
majority in aggregate
A-6
<PAGE>
Liquidation Amount of the corresponding Preferred Securities of such Bear
Stearns Trust shall have such right. The Indenture also provides that the
Holders of a majority in principal amount of all of the Securities of all series
then outstanding as to which an Event of Default has occurred may, on behalf of
all Holders of such Securities, waive any past default under the Indenture other
than (a) a default in the payment of the principal of or interest on any of the
Securities or (b) a default in respect of a covenant or provision of the
Indenture which under the terms of the Indenture cannot be modified or amended
without the consent of each Holder of Securities so affected. In the case of
Securities of one or more series issued to one or more Bear Stearns Trusts, the
Indenture provides that the Holders of a majority in aggregate Liquidation
Amount of the corresponding Preferred Securities or Preferred Securities issued
by such Bear Stearns Trusts shall also have the right to waive such defaults.
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in principal amount
of the outstanding Securities of all affected series (voting as one class), to
modify the Indenture in a manner affecting the rights of the holders of the
Securities of each such series; provided, however, that no such modification
shall (i) change the fixed maturity of any Securities, or reduce the rate or
extend the time of payment of interest thereon or reduce the principal amount
thereof, or change the provisions pursuant to which the rate of interest on the
Securities is determined if such change could reduce the rate of interest
thereon, or reduce the minimum rate of interest thereon, or reduce any amount
payable upon any redemption thereof, or adversely affect any right to convert
the Securities in accordance with the Indenture, or reduce the amount to be paid
at maturity or upon redemption or make the principal thereof or any interest
thereon or on any overdue principal amount payable in any coin or currency other
than that provided in the Securities without the consent of the holder of each
Security so affected, (ii) reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any supplemental indenture, without
the consent of the holders of all Securities then Outstanding, or (iii) modify
any of the provisions of Section 4.07, Section 6.06 or Section 10.02 of the
Indenture, except to increase any such percentage or to provide that certain
other provisions of the Indenture cannot be modified or waived without the
consent of the holder of each Security affected thereby or (iv) modify the
provisions of Article XIV of the Indenture with respect to the subordination of
outstanding Securities of any series in a manner adverse to the holders thereof,
without the consent of the holder of each Security so affected; provided,
further, that, in the case of the Securities of a series issued to a Bear
Stearns Trust, so long as any of the corresponding series of Preferred
Securities issued by such Bear Stearns Trust remains outstanding, (i) no such
amendment shall be made that adversely affects the holders of such Preferred
Securities in any material respect (including any amendment which would result
in a Bear Stearns Trust being classified as other than a grantor trust for
United States federal income tax purposes), and no termination of the Indenture
shall occur, and no waiver of any Event of Default with respect to such series
or compliance with any covenant with respect to such series under the Indenture
shall be effective, without the prior consent of the holders of at least a
majority of the aggregate Liquidation Amount of such Preferred Securities then
outstanding, unless and until the principal (and premium, if any) of the
Securities of such series and all accrued and unpaid interest (including any
Additional Sums, Additional Interest and Compounded Interest) thereon shall have
been paid in full and (ii) no amendment shall be
A-7
<PAGE>
made to Section 6.05 of the Indenture (regarding the right of holders of
Preferred Securities to institute a suit directly against the Company) that
would impair the rights of the holders of Preferred Securities provided therein
without the prior consent of all holders of Preferred Securities then
outstanding, unless and until the principal (and premium, if any) of the
Securities of such series and all accrued and unpaid interest (including any
Additional Sums, Additional Interest and Compounded Interest) thereon have been
paid in full.
The Debenture will be prepayable, in whole or in part, at the option of the
Company at any time on or after _____________, 20__, at a prepayment price (the
"Optional Redemption Price") equal to the outstanding principal amount of the
Debenture plus accrued interest thereon to the date of prepayment.
Upon the occurrence and during the continuation of a Special Event, in
respect of the Trust, the Company may, at its option, at any time within 90 days
of the occurrence of such Special Event redeem this Debenture, in whole but not
in part, at a prepayment price (the "Special Event Prepayment Price") equal to
the greater of (i) 100% of the principal amount hereof; or (ii) as determined by
a Calculation Agent, the sum of the present value of the principal amount that
would be payable with respect to an optional redemption of a Debenture on
_____________, 20__, together with the present values of scheduled payments of
interest from the prepayment date to _____________, 20__, in each case
discounted to the prepayment date on a semi-annual basis at the Adjusted CMT
Rate, plus, in each case, accrued and unpaid interest to but excluding the date
of prepayment. However, if the Company redeems the Debenture as a result of a
Special Event which occurs on or after _____________, 20__, then the Special
Event Prepayment Price shall be the Optional Redemption Price that would be
payable on optional redemption of the Debentures on the date of such prepayment,
which includes accrued and unpaid interest to the date of prepayment.
Any consent or waiver by the Holder of this Debenture given as provided in
the Indenture (unless effectively revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future Holders of this
Debenture and of any Debenture issued in exchange, registration of transfer, or
otherwise in lieu hereof irrespective of whether any notation of such consent or
waiver is made upon this Debenture or such other Debentures. No reference herein
to the Indenture and no provision of this Debenture 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 on this Debenture, at the
places, at the respective times, at the rate and in the coin or currency herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Debenture may be registered on the Register of the
Debentures upon surrender of this Debenture for registration of transfer at the
offices maintained by the Company or its agent for such purpose, duly endorsed
by the Holder hereof or his attorney duly authorized in writing, or accompanied
by a written instrument of transfer in form satisfactory to the Company and the
Securities Registrar duly executed by the Holder hereof or his attorney duly
authorized in writing, but without payment of any charge other than a sum
sufficient to reimburse the Company for any tax or other governmental charge
incident
A-8
<PAGE>
thereto. Upon any such registration of transfer, a new Debenture or Debentures
of authorized denomination or denominations for the same aggregate principal
amount will be issued to the transferee in exchange herefor.
Prior to due presentment for registration of transfer of this Debenture,
the Company, the Trustee, and any agent of the Company or the Trustee may deem
and treat the person in whose name this Debenture shall be registered upon the
Register of the Debentures of this series as the absolute owner of this
Debenture (whether or not this Debenture shall be overdue and notwithstanding
any notation of ownership or other writing hereon) for the purpose of receiving
payment of or on account of the principal hereof and, subject to the provisions
on the face hereof, interest due hereon and for all other purposes; and neither
the Company nor the Trustee nor any such agent 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 Debenture, or for any claim based hereon or otherwise in respect hereof, or
based on or in respect of the Indenture or any indenture supplemental thereto,
against any stockholder, officer, director or employee, as such, past, present
or future, of the Company or of any successor corporation, either directly or
through the Company, 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 a part of the consideration for
the issue hereof, expressly waived and released.
The Company, and by acceptance of this Debenture, the Holder hereof, and
any Person that acquires a beneficial interest herein, agree that for United
States federal, state and local tax purposes it is intended that this Debenture
constitute indebtedness.
THIS DEBENTURE 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 LAW
PRINCIPLES THEREOF.
A-9
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers the
within Fixed/Adjustable Rate Junior Subordinated Deferrable Interest Debenture
(the "Debenture") and all rights thereunder, unto
----------------------------------------------
Please insert Social Security
or other identifying number of assignee:
----------------------------------------------------------------
(Name and Address of Assignee, including Zip Code,
must be printed or typewritten)
and hereby irrevocably constitutes and appoints
- ----------------------------------------------------------------------------
Attorney to transfer said Debenture on the Register of the Debentures, with full
power of substitution in the premises.
Date:
----------------------------------------
Signature(s)
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a major stock exchange.
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Fixed/Adjustable Rate Junior
Subordinated Deferrable Interest Debenture in every particular,
without alteration or enlargement or any change whatever.
A-10
<PAGE>
FORM OF SCHEDULE FOR ENDORSEMENTS ON GLOBAL DEBENTURE
TO REFLECT CHANGES IN PRINCIPAL AMOUNT
The initial principal amount evidenced by this Global Debenture is $________.
<TABLE>
<CAPTION>
- ------------------------ ------------------------------------- ------------------------------ ------------------------
Principal Amount by which this
Global Debenture is to be Reduced Remaining Principal Amount
Date and Reason for Reduction of this Global Debenture Notation Made by
- ------------------------ ------------------------------------- ------------------------------ ------------------------
<S> <C> <C> <C>
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</TABLE>
A-11
CERTIFICATE OF TRUST
OF
BEAR STEARNS CAPITAL TRUST II
THIS Certificate of Trust of Bear Stearns Capital Trust II (the "Trust"),
dated as of November 4, 1998 is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del.C. Section 3801, et seq.).
1. Name. The name of the business trust formed hereby is Bear Stearns
Capital Trust II.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: /s/ Denis Kelly
-------------------------------
Name: Denis Kelly
Title: Trust Services Administration
Officer
THE CHASE MANHATTAN BANK,
as Property Trustee
By: /s/ William G. Keenan
-------------------------------
Name: William G. Keenan
Title: Trust Officer
CERTIFICATE OF TRUST
OF
BEAR STEARNS CAPITAL TRUST III
THIS Certificate of Trust of Bear Stearns Capital Trust III (the "Trust"),
dated as of November 4, 1998 is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del.C. Section 3801, et seq.).
1. Name. The name of the business trust formed hereby is Bear Stearns
Capital Trust III.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: /s/ Denis Kelly
-------------------------------
Name: Denis Kelly
Title: Trust Services Administration
Officer
THE CHASE MANHATTAN BANK,
as Property Trustee
By: /s/ William G. Keenan
-------------------------------
Name: William G. Keenan
Title: Trust Officer
CERTIFICATE OF TRUST
OF
BEAR STEARNS CAPITAL TRUST IV
THIS Certificate of Trust of Bear Stearns Capital Trust IV (the "Trust"),
dated as of November 4, 1998 is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del.C. Section 3801, et seq.).
1. Name. The name of the business trust formed hereby is Bear Stearns
Capital Trust IV.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: /s/ Denis Kelly
-------------------------------
Name: Denis Kelly
Title: Trust Services Administration
Officer
THE CHASE MANHATTAN BANK,
as Property Trustee
By: /s/ William G. Keenan
-------------------------------
Name: William G. Keenan
Title: Trust Officer
CERTIFICATE OF TRUST
OF
BEAR STEARNS CAPITAL TRUST V
THIS Certificate of Trust of Bear Stearns Capital Trust V (the "Trust"),
dated as of November 4, 1998 is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del.C. Section 3801, et seq.).
1. Name. The name of the business trust formed hereby is Bear Stearns
Capital Trust V.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By: /s/ Denis Kelly
-------------------------------
Name: Denis Kelly
Title: Trust Services Administration
Officer
THE CHASE MANHATTAN BANK,
as Property Trustee
By: /s/ William G. Keenan
-------------------------------
Name: William G. Keenan
Title: Trust Officer
================================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
among
THE BEAR STEARNS COMPANIES INC.,
as Depositor,
THE CHASE MANHATTAN BANK,
as Property Trustee,
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee,
THE ADMINISTRATORS NAMED HEREIN
and
THE SEVERAL HOLDERS
Dated as of _________, ____
BEAR STEARNS CAPITAL TRUST __
================================================================================
<PAGE>
CROSS-REFERENCE TABLE
Trust Indenture Trust Agreement
Act Section Section
- --------------- ---------------
310 (a)(1)............................................... 8.1
(a)(2)............................................... 8.1
(a)(3)............................................... 8.9
(a)(4)............................................... Not Applicable
(b).................................................. 8.8
311 (a).................................................. 8.13
(b).................................................. 8.13
312 (a).................................................. 5.7
(b).................................................. 5.7
(c).................................................. 5.7
313 (a).................................................. 8.14(a), 8.14(b)
(b).................................................. Not Applicable
(c).................................................. 10.8
(d).................................................. 8.14(c)
314 (a).................................................. 8.15
(b).................................................. Not Applicable
(c)(1)............................................... 8.16
(c)(2)............................................... 8.16
(c)(3)............................................... Not Applicable
(d).................................................. Not Applicable
(e).................................................. 1.1, 8.16
315 (a).................................................. 8.2
(b).................................................. 8.2, 10.8
(c).................................................. 8.2
(d).................................................. 8.2
(e).................................................. Not Applicable
316 (a).................................................. Not Applicable
(a)(1)(A)............................................ Not Applicable
(a)(1)(B)............................................ Not Applicable
(a)(2)............................................... Not Applicable
(b)..................................................
(c).................................................. 6.7
317 (a)(1)............................................... Not Applicable
(a)(2)............................................... Not Applicable
(b).................................................. 5.9
318 (a).................................................. 10.11
- --------------
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Trust Agreement.
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINED TERMS
SECTION 1.1. Definitions...................................................1
ARTICLE II
CONTINUATION OF THE TRUST
SECTION 2.1. Name.........................................................10
SECTION 2.2. Office of the Delaware Trustee; Principal Place of
Business ....................................................10
SECTION 2.3. Initial Contribution of Trust Property; Organizational
Expenses ....................................................10
SECTION 2.4. Issuance of the Preferred Securities.........................11
SECTION 2.5. Issuance of the Common Securities; Subscription and
Purchase of Debentures ......................................11
SECTION 2.6. Declaration of Trust; Intention of Parties...................11
SECTION 2.7. Authorization to Enter into Certain Transactions.............12
SECTION 2.8. Assets of Trust..............................................16
SECTION 2.9. Title to Trust Property......................................16
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. Payment Account..............................................16
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions...................................................17
SECTION 4.2. Redemption...................................................18
SECTION 4.3. Subordination of Common Securities...........................20
SECTION 4.4. Payment Procedures...........................................21
SECTION 4.5. Tax Returns and Reports......................................21
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Trust..................21
SECTION 4.7. Reduction for Payments under Indenture or Pursuant to
Direct Actions ..............................................21
ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. Initial Ownership............................................22
SECTION 5.2. The Trust Securities Certificates; Execution and
Delivery Thereof ............................................22
SECTION 5.3. Transfer of Preferred Securities.............................22
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<PAGE>
SECTION 5.4. Registration of Transfer and Exchange of Preferred
Securities Certificates .....................................23
SECTION 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates ................................................24
SECTION 5.6. Persons Deemed Securityholders...............................24
SECTION 5.7. Access to List of Securityholders' Names and Addresses.......24
SECTION 5.8. Maintenance of Office or Agency for Transfers................25
SECTION 5.9. Appointment of Paying Agent..................................25
SECTION 5.10. Ownership of Common Securities by Depositor..................26
SECTION 5.11. Book-Entry Interests.........................................26
SECTION 5.12. Notices to Clearing Agency...................................28
SECTION 5.13. Procedures for Issuance of Definitive Preferred
Securities Certificates .....................................28
SECTION 5.14. Rights of Securityholders....................................28
SECTION 5.15. CUSIP Numbers................................................30
ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1. Limitations on Voting Rights.................................31
SECTION 6.2. Notice of Meetings...........................................32
SECTION 6.3. Meetings of Preferred Securityholders........................32
SECTION 6.4. Voting Rights................................................33
SECTION 6.5. Proxies, Etc.................................................33
SECTION 6.6. Securityholder Action by Written Consent.....................33
SECTION 6.7. Record Date for Voting and Other Purposes....................33
SECTION 6.8. Acts of Securityholders......................................33
SECTION 6.9. Inspection of Records........................................35
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee
and the Delaware Trustee ....................................35
SECTION 7.2. Representations and Warranties of Depositor..................36
ARTICLE VIII
THE TRUSTEES AND ADMINISTRATORS
SECTION 8.1. Corporate Property Trustee Required; Eligibility of
Trustees ....................................................36
SECTION 8.2. Certain Duties and Responsibilities..........................37
SECTION 8.3. Certain Notices..............................................38
SECTION 8.4. Certain Rights of Property Trustee...........................39
SECTION 8.5. Not Responsible for Recitals or Issuance of Securities.......41
SECTION 8.6. May Hold Securities..........................................41
SECTION 8.7. Compensation; Indemnity; Fees................................41
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<PAGE>
SECTION 8.8. Conflicting Interests........................................43
SECTION 8.9. Co-Trustees and Separate Trustee.............................43
SECTION 8.10. Resignation and Removal; Appointment of Successor............44
SECTION 8.11. Acceptance of Appointment by Successor.......................46
SECTION 8.12. Merger, Conversion, Consolidation or Succession to Business..46
SECTION 8.13. Property Trustee May File Proofs of Claim....................47
SECTION 8.14. Reports by Property Trustee..................................47
SECTION 8.15. Reports to the Property Trustee..............................48
SECTION 8.16. Evidence of Compliance with Conditions Precedent.............48
SECTION 8.17. Number of Trustees...........................................48
SECTION 8.18. Delegation of Power..........................................48
SECTION 8.19. Delaware Trustee.............................................49
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. Dissolution Upon Expiration Date.............................49
SECTION 9.2. Early Dissolution...........................................49
SECTION 9.3. Dissolution..................................................50
SECTION 9.4. Liquidation..................................................50
SECTION 9.5. Mergers, Consolidations, Conversions, Amalgamations or
Replacements of the Trust ...................................52
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Securityholders to Terminate Trust...53
SECTION 10.2. Amendment....................................................53
SECTION 10.3. Separability.................................................54
SECTION 10.4. Governing Law................................................54
SECTION 10.5. Payments Due on Non-Business Day.............................55
SECTION 10.6. Successors...................................................55
SECTION 10.7. Headings.....................................................55
SECTION 10.8. Reports, Notices and Demands.................................55
SECTION 10.9. Agreement Not to Petition....................................56
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.......56
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture ...................................................56
SECTION 10.12. Counterparts.................................................57
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<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT, dated as of _____________, ____ among
The Bear Stearns Companies Inc., a Delaware corporation (including any
successors or assigns, the "Depositor"), (ii) The Chase Manhattan Bank, a
banking corporation duly organized and existing under the laws of the State of
New York, as property trustee (in such capacity, the "Property Trustee" and, in
its separate corporate capacity and not in its capacity as Property Trustee, the
"Bank"), (iii) Chase Manhattan Bank Delaware, a Delaware banking corporation
that maintains its principal place of business in Delaware, as Delaware trustee
(the "Delaware Trustee"), (the Property Trustee and the Delaware Trustee
referred to jointly as the "Trustees"), (iv) Kenneth L. Edlow, an individual,
Samuel L. Molinaro Jr., an individual, and William J. Montgoris, an individual,
each of whose address is c/o The Bear Stearns Companies Inc., 245 Park Avenue,
New York, New York 10167 (each, an "Administrator" and all collectively, the
"Administrators") and (v) the several Holders, as hereinafter defined.
W I T N E S S E T H :
WHEREAS, the Depositor, the Property Trustee, the Delaware Trustee and the
Administrators (where applicable) have heretofore duly declared and established
a business trust pursuant to the Delaware Business Trust Act by entering into
that certain Trust Agreement, dated as of November 4, 1998 (the "Original Trust
Agreement"), and by the execution and filing with the Secretary of State of the
State of Delaware of a Certificate of Trust, filed on November 4, 1998, attached
as Exhibit A (the "Certificate of Trust");
WHEREAS, the parties hereto desire to amend and restate the Original Trust
Agreement in its entirety as set forth herein to provide for, among other
things, (i) the issuance of the Common Securities by the Trust to the Depositor,
(ii) the issuance and sale of the Preferred Securities by the Trust pursuant to
the Underwriting Agreement, (iii) the acquisition by the Trust from the
Depositor of all of the right, title and interest in the Debentures, and (iv)
the appointment of the Administrators.
NOW THEREFORE, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, each party, for the benefit of the other parties and for
the benefit of the Securityholders, hereby amends and restates the Original
Trust Agreement in its entirety and agrees as follows:
ARTICLE I
DEFINED TERMS
SECTION 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
<PAGE>
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this Trust
Agreement; and
(d) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Trust Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest,
Compounded Interest (each as defined in the Indenture) and Additional Sums paid
by the Depositor on a Like Amount of Debentures for such period.
"Additional Sums" has the meaning specified in Section 4.08 of the
Indenture.
"Administrators" has the meaning specified in the preamble to this
Agreement or any successors appointed in accordance with Section 8.10 solely in
such Person's capacity as Administrator of the Trust heretofore created and
continued hereunder and not in such Person's individual capacity.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in the
premises judging such Person a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjudication or
composition of or in respect of such Person under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of such Person or of all or substantially all of its property or
ordering the
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<PAGE>
winding up or liquidation of its affairs, and the continuance of any such decree
or order unstayed and in effect for a period of 90 consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or similar official) of
such Person or of all or substantially all of its property, or the making by it
of an assignment for the benefit of creditors, or the admission by it in writing
of its inability to pay its debts generally as they become due and its
willingness to be adjudicated a bankrupt, or the taking of corporate action by
such Person in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Book-Entry Preferred Securities Certificates" has the meaning specified in
Section 5.11.
"Business Day" means any day which is not a Saturday or Sunday and which in
The City of New York is neither a legal holiday nor a day on which banking
institutions are authorized or required by law or regulation to close or a day
on which the corporate trust office of the Property Trustee or the Debenture
Trustee is closed for business.
"Certificate Depository Agreement" means a customary letter of
representations among the Trust, the Property Trustee and DTC, as the initial
Clearing Agency, dated as of the Closing Date, relating to the Trust Securities
Certificates, as the same may be amended and supplemented from time to time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. DTC will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Closing Date" means ____________, ____, which is the date of execution and
delivery of this Trust Agreement, or such other date as may be designated the
Closing Date pursuant to the Underwriting Agreement.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this Trust Agreement 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.
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<PAGE>
"Common Security" means a common undivided beneficial interest in the
assets of the Trust, having a Liquidation Amount of $_____ and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing ownership of
Common Securities, substantially in the form attached as Exhibit B.
"Corporate Trust Office" means (i) when used with respect to the Property
Trustee, the principal corporate trust office of the Property Trustee and (ii)
when used with respect to the Debenture Trustee, the principal corporate trust
office of the Debenture Trustee.
"Debenture Applicable Rate" means the "Applicable Rate" as defined in the
Indenture.
"Debenture Event of Default" means an "Event of Default" as defined in the
Indenture.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Trustee" means The Chase Manhattan Bank, and any successor
thereto under the Indenture.
"Debentures" means the aggregate principal amount of the Depositor's
Fixed/Adjustable Rate Junior Subordinated Deferrable Interest Debentures due
____________, 20__ issued pursuant to the Indenture.
"Definitive Preferred Securities Certificates" means Preferred Securities
Certificates issued in certificated, fully registered form as provided in
Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Section 3801, et seq., as it may be amended from time to time.
"Delaware Trustee" means the corporation identified as the "Delaware
Trustee" in the preamble to this Trust Agreement solely in its capacity as
Delaware Trustee of the Trust created and continued hereunder, or its successor
in interest in such capacity, or any successor Delaware trustee appointed as
herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.1.
"DTC" means The Depository Trust Company.
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<PAGE>
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Trust in the payment of any Distribution when it becomes
due and payable, and continuation of such default for a period of 30 days; or
(c) default by the Trust in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in the performance or breach of which is dealt
with in clause (b) or (c) above), and continuation of such default or breach for
a period of 90 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 Preferred Securities, a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indenture" means the Indenture, dated as of January 29, 1997,
between the Depositor and The Chase Manhattan Bank, as trustee, as amended or
supplemented from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Guarantee" means the Preferred Securities Guarantee Agreement executed and
delivered by the Depositor and The Chase Manhattan Bank, as trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the Holders of the Preferred Securities as amended from time to
time.
"Holder" means a Person in whose name a Trust Security or Trust Securities
is registered in the Securities Register; any such Person being a beneficial
owner within the meaning of the Delaware Business Trust Act.
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<PAGE>
"Indenture" means the Indenture, dated as of _______ __ ____, between the
Depositor and the Debenture Trustee, as trustee, as amended or supplemented from
time to time.
"Investment Company Event" means the receipt by the Trust of an Opinion of
Counsel to the effect that, as a result of the occurrence of a change in law or
regulation or a change (including any announced proposed 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,
which change or proposed change becomes effective or would become effective, as
the case may be, on or after the date of the issuance of the Preferred
Securities of the Trust.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount equal to the principal amount of
Debentures to be contemporaneously redeemed in accordance with the Indenture the
proceeds of which will be used to pay the Redemption Price of such Trust
Securities, and (b) with respect to a distribution of Debentures to Holders of
Trust Securities in connection with a dissolution or liquidation of the Trust,
Debentures having a principal amount equal to the Liquidation Amount of the
Trust Securities of the Holder to whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $_____ per Trust Security.
"Liquidation Date" means the date on which Debentures are to be distributed
to Holders of Trust Securities in connection with a termination and liquidation
of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board or any Vice Chairman of the Board or the President or any Executive Vice
President or Chief Operating Officer or Chief Financial Officer of the Depositor
and by the Treasurer or an Assistant Treasurer or Controller or the Secretary or
an Assistant Secretary of the Depositor and delivered to the appropriate
Trustee. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
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<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 counsel
for the Trust, the Property Trustee or the Depositor (including counsel who is
an employee of the Depositor), who is experienced in matters related to the
substance of the opinion.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Trust Securities, means, as of the
date of determination, all Trust Securities theretofore executed and delivered
under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Securities Registrar or
delivered to the Securities Registrar for cancellation;
(b) Trust Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any Paying
Agent for the Holders of such Trust Securities; provided that, if such Trust
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Trust Agreement; and
(c) Trust Securities which have been paid or in exchange for or in lieu of
which other Trust Securities have been executed and delivered pursuant to
Sections 5.4, 5.5, 5.11 and 5.13; provided, however, that in determining whether
the Holders of the requisite Liquidation Amount of the Outstanding Preferred
Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Preferred Securities owned by the Depositor, any
Trustee or any Affiliate of the Depositor or any Trustee shall be disregarded
and deemed not to be Outstanding, except that (a) in determining whether any
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Preferred Securities
that such Trustee knows to be so owned shall be so disregarded and (b) the
foregoing shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Depositor, one or more of the Trustees and/or any
such Affiliate. Preferred Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Administrators the pledgee's right so to act with respect to
such Preferred Securities and that the pledgee is not the Depositor or any
Affiliate of the Depositor.
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<PAGE>
"Owner" means each Person who is the beneficial owner of a Book-Entry
Preferred Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the Owner, then as reflected
in the records of a Person maintaining an account with such Clearing Agency
(directly or indirectly, in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed pursuant
to Section 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee with the Bank in its trust department
for the benefit of the Securityholders in which all amounts paid in respect of
the Debentures will be held and from which the Property Trustee, through the
Paying Agent, shall make payments to the Securityholders in accordance with
Sections 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $_____ and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing ownership
of Preferred Securities, substantially in the form attached as Exhibit C.
"Property Trustee" means the commercial bank or trust company identified as
the "Property Trustee" in the preamble to this Trust Agreement solely in its
capacity as Property Trustee of the Trust heretofore created and continued
hereunder, or its successor in interest in such capacity, or any successor
property trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Debentures, allocated on a pro rata basis (based on Liquidation Amounts) among
the Trust Securities.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
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"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.4.
"Securityholder" means a Person in whose name a Trust Security or Trust
Securities is registered in the Securities Register; any such Person shall be a
beneficial owner within the meaning of the Delaware Business Trust Act.
"Special Event" means an Investment Company Event or a Tax Event.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel 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 issuance of the Preferred Securities under this Trust Agreement, there is
more than an insubstantial risk that (i) the Trust is, or will be within 90 days
after the date of such Opinion of Counsel, subject to United States federal
income tax with respect to income received or accrued on the Debentures, (ii)
interest payable by the Depositor on the Debentures is not, or within 90 days
after the date of such Opinion of Counsel, will not be, deductible by the
Depositor, in whole or in part, for United States federal income tax purposes or
(iii) the Trust is, or will be within 90 days after the date of such Opinion of
Counsel, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"Trust" means the Delaware business trust created under the Original Trust
Agreement and continued hereby and identified on the cover page to this Trust
Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including for all purposes of this Trust Agreement and any
such modification, amendment or supplement, the provisions of the Trust
Indenture Act that are deemed to be a part of and govern this Trust Agreement
and any such modification, amendment or supplement, respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Payment Account and (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Property Trustee pursuant to the trusts of this Trust Agreement.
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"Trust Security" means any one of the Common Securities or the Preferred
Securities. The Trust Securities represent undivided beneficial interests in the
Trust Property.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee and the Delaware
Trustee.
"Underwriter" means _________________.
"Underwriting Agreement" means the Agreement, dated as of
_________________, ____ among the Trust, the Depositor and
______________________ ____________________, as representatives of the
underwriters named therein.
ARTICLE II
CONTINUATION OF THE TRUST
SECTION 2.1. Name.
The Trust continued hereby shall be known as "Bear Stearns Capital Trust
__" as such name may be modified from time to time by the Administrators
following written notice to the Securityholders and the Trustees, in which name
the Property Trustee and the Administrators may conduct the business of the
Trust, make and execute contracts and other instruments on behalf of the Trust
and sue and be sued.
SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801,
Attention: Corporate Trustee Administration Department, or such other address in
the State of Delaware as the Delaware Trustee may designate by written notice to
the Securityholders and the Depositor. The principal executive office of the
Trust is c/o The Bear Stearns Companies Inc. 245 Park Avenue, New York, New York
10167.
SECTION 2.3. Initial Contribution of Trust Property; Organizational
Expenses.
The Trust acknowledges receipt in trust from the Depositor in connection
with the Original Trust Agreement of the sum of $10, which constituted the
initial Trust Property. The Depositor shall pay organizational expenses of the
Trust as they arise or shall, upon request of any Trustee, promptly reimburse
such Trustee for any such expenses paid by such Trustee. The Depositor shall
make no claim upon the Trust Property for the payment of such expenses.
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SECTION 2.4. Issuance of the Preferred Securities.
The Depositor, on behalf of the Trust and pursuant to the Original Trust
Agreement, executed and delivered the Underwriting Agreement. Contemporaneously
with the execution and delivery of this Trust Agreement, an Administrator, on
behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to
the Underwriters, Preferred Securities Certificates, registered in the name of
the nominee of the initial Clearing Agency, in an aggregate amount of ___,000
Preferred Securities having an aggregate Liquidation Amount of $___,000,000
against receipt of an aggregate purchase price for such Preferred Securities of
$__________ ($_______ per Preferred Security).
SECTION 2.5. Issuance of the Common Securities; Subscription and Purchase
of Debentures.
Contemporaneously with the execution and delivery of this Trust Agreement,
an Administrator, on behalf of the Trust, shall execute in accordance with
Section 5.2 and deliver to the Depositor, Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of _____ Common
Securities having an aggregate Liquidation Amount of $_________ against payment
by the Depositor of an aggregate purchase price of $_________ ($______ per
Common Security). Contemporaneously therewith, an Administrator, on behalf of
the Trust, shall subscribe to and purchase from the Depositor Debentures,
registered in the name of the Property Trustee and having an aggregate principal
amount equal to $_________ and, in satisfaction of the purchase price for such
Debentures, the Trust shall deliver to the Depositor the sum of $_________ such
sum being the sum of the amounts delivered to the Trust pursuant to (i) the
second sentence of Section 2.4 and (ii) the first sentence of this Section 2.5).
SECTION 2.6. Declaration of Trust; Intention of Parties.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Trust Securities, (b) to use the proceeds from such sale to acquire the
Debentures and (c) to engage in those activities necessary, convenient or
incidental thereto. The Depositor hereby appoints the Trustees as trustees of
the Trust and the Administrators, to have all the rights, powers and duties to
the extent set forth herein, and the Trustees and the Administrators hereby
accept such appointment. The Property Trustee hereby declares that it will hold
the Trust Property in trust upon and subject to the conditions set forth herein
for the benefit of the Trust and the Securityholders. The Administrators shall
have only those ministerial duties set forth herein with respect to
accomplishing the purposes of the Trust and, to the fullest extent permitted by
law, shall not be trustees or fiduciaries with respect to the Trust. The
Property Trustee shall have the power (but not the obligation) to perform those
duties assigned to the Administrators. 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 Property Trustee or the Administrators set
forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Delaware Business Trust Act. The Trust shall not borrow money, issue debt or
reinvest
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proceeds derived from investments, pledge any assets, or otherwise undertake or
permit to be undertaken any activity that is reasonably likely to cause the
Trust not to be classified for United States federal income tax purposes as a
grantor trust. It is the intention of the parties hereto that the Trust be
classified as a grantor trust for United States federal income tax purposes. The
provisions of this Agreement shall be interpreted to further this intention of
the parties.
SECTION 2.7. Authorization to Enter into Certain Transactions.
(a) The Trustees and the Administrators shall conduct the affairs of the
Trust in accordance with the terms of this Trust Agreement. Subject to the
limitations set forth in paragraph (b) of this Section, and in accordance with
the following provisions (i) and (ii) the Trustees and the Administrators shall
have the authority to enter into all transactions and agreements determined by
the Trustees or the Administrators to be appropriate in exercising the
authority, express or implied, otherwise granted to the Trustees or the
Administrators under this Trust Agreement, and to perform all acts in
furtherance thereof, including, without limitation, the following:
(i) Each Administrator shall have the power and authority to act
on behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Certificate
Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust;
(C) assisting in the registration of the Preferred
Securities under the Securities Act of 1933, as amended, and
under state securities or blue sky laws, and the qualification
of this Trust Agreement as a trust indenture under the Trust
Indenture Act, as the same may be deemed necessary or
advisable;
(D) assisting in the listing, if any, of the
Preferred Securities upon such national securities exchange or
exchanges or automated quotation system or systems as shall be
determined by the Depositor and the registration of the
Preferred Securities under the Exchange Act, if required by
applicable law, and the execution and filing of all
applications, periodic and other reports and other documents
pursuant to the foregoing, or the seeking of relief from same;
(E) the sending of notices (other than notices of
default) and other information regarding the Trust Securities
and the Debentures to the Securityholders in accordance with
this Trust Agreement;
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(F) the consent to the appointment of a Paying Agent
and Securities Registrar in accordance with this Trust
Agreement which consent shall not be unreasonably withheld;
(G) execution of the Trust Securities on behalf of
the Trust in accordance with this Trust Agreement;
(H) the taking of any action incidental to the
foregoing as the Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement for the benefit of the Securityholders
(without consideration of the effect of any such action on any
particular Securityholder);
(I) execution and delivery of closing certificates,
if any, pursuant to the Underwriting Agreement and application
for a taxpayer identification number for the Trust;
(J) registering transfer of the Trust Securities in
accordance with this Trust Agreement;
(K) execution and delivery of letters or documents
to, or instruments with DTC relating to the Preferred
Securities;
(L) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the execution and filing of the certificate of
cancellation with the Secretary of State of the State of
Delaware;
(M) unless otherwise required by the Trust Indenture
Act, to execute on behalf of the Trust (either acting alone or
together with any or all of the Administrators) any documents
that the Administrators have the power to execute pursuant to
this Trust Agreement;
(N) to establish a record date with respect to all
actions to be taken hereunder that require a record date be
established, including and with respect to, for the purposes
of Section 316(c) of the Trust Indenture Act, Distributions,
voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Trust Securities as to such
actions and applicable record dates; and
(O) to duly prepare and file all applicable tax
returns and tax information reports that are required to be
filed with respect to the Trust on behalf of the Trust.
(ii) As among the Trustees and the Administrators, the Property
Trustee shall have the power, duty and authority to act on behalf of the Trust
with respect to the following matters:
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(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any
other payments made in respect of the Debentures in the
Payment Account;
(D) the distribution through the Paying Agent of
amounts owed to the Securityholders in respect of the Trust
Securities;
(E) subject to the provisions hereof, the exercise of
all of the rights, powers and privileges of a holder of the
Debentures;
(F) the sending of notices of default and other
information regarding the Trust Securities and the Debentures
to the Securityholders in accordance with this Trust
Agreement;
(G) the distribution of the Trust Property in
accordance with the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the preparation, execution and filing of the certificate
of cancellation with the Secretary of State of the State of
Delaware;
(I) after an Event of Default (other than under
paragraph (b), (c), (d) or (e) of the definition of such term
if such Event of Default is by or with respect to the Property
Trustee) the taking of any action incidental to the foregoing
as the Property Trustee may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement and protect and conserve the Trust Property
for the benefit of the Securityholders (without consideration
of the effect of any such action on any particular
Securityholder); and
(J) to take all reasonable action at the direction of
the Depositor 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 of the
Preferred Securities or to enable the Trust to effect the
purposes for which the Trust was created;
(iii) The Property Trustee shall have the power and authority to
act on behalf of the Trust with respect to any of the duties,
liabilities, powers or the authority of the Administrators set forth in
Section 2.7(a)(i)(G); and in the event of a conflict
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between the action of the Administrators and the action of the Property
Trustee, the action of the Property Trustee shall prevail.
(b) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees or the Administrators acting on behalf of the Trust) shall not
undertake any business, activities or transaction except as expressly provided
herein or contemplated hereby. In particular, neither the Trustees nor the
Administrators shall, on behalf of the Trust, (i) acquire any investments or
assets other than the Trust Property or engage in any activities not authorized
by this Trust Agreement, (ii) sell, assign, transfer, exchange, mortgage,
pledge, set-off or otherwise dispose of any of the Trust Property or interests
therein, including to Securityholders, except as expressly provided herein,
(iii) take any action that is reasonably likely to cause the Trust to fail or
cease to qualify as a "grantor trust" for United States federal income tax
purposes, (iv) incur any indebtedness for borrowed money or issue any other debt
or (v) take or consent to any action that would result in the placement of a
Lien on any of the Trust Property. The Property Trustee shall defend all claims
and demands of all Persons at any time claiming any Lien on any of the Trust
Property adverse to the interest of the Trust or the Securityholders in their
capacity as Securityholders.
(c) In connection with the issuance and sale of the Preferred Securities,
the Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Trust with the Commission
and the execution on behalf of the Trust of a "shelf" registration
statement on the appropriate form, including amendments thereto, to
register the Preferred Securities, the Guarantee and the Debentures;
(ii) the determination of the states in which to take appropriate
action to qualify or register for sale all or part of the Preferred
Securities and the determination of any and all such acts, other than
actions which must be taken by or on behalf of the Trust, and the
advice to the Trustees of actions they must take on behalf of the
Trust, and the preparation for execution and filing of any documents to
be executed and filed by the Trust or on behalf of the Trust, as the
Depositor deems necessary or advisable in order to comply with the
applicable laws of any such states;
(iii) if the Depositor shall desire, the preparation for filing by
the Trust and execution on behalf of the Trust of an application to the
New York Stock Exchange or any other national or international stock
exchange or the Nasdaq National Market or any other automated quotation
system for listing, upon notice of issuance, of any Preferred
Securities; and the preparation for filing by the Trust with the
Commission and the execution on behalf of the Trust of a registration
statement on Form 8-A relating to the registration of the Preferred
Securities under Section 12(b) or 12(g) of the Exchange Act, including
any amendments thereto; and filing with such
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exchange or self-regulatory organization such notifications and
documents as may be necessary from time to time to maintain such
listing;
(iv) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Preferred Securities; and
(v) the taking of any other actions necessary or desirable to
carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrators and
the Property Trustee are authorized and directed to conduct the affairs of the
Trust and to operate the Trust so that the Trust will not be deemed to be an
"investment company" required to be registered under the 1940 Act or fail to be
classified as a grantor trust for United States federal income tax purposes and
so that the Debentures will be treated as indebtedness of the Depositor for
United States federal income tax purposes. In this regard, the Property Trustee
shall be protected if it shall have conducted the affairs of the Trust and
operated the Trust in accordance with its rights, powers and duties as
specifically set forth in this Trust Agreement. In this connection, the
Administrators, the Property Trustee and the Holder of the Common Securities are
authorized to take any action, not inconsistent with applicable law, the
Certificate of Trust or this Trust Agreement, that any of the Administrators,
Property Trustee and the Holder of the Common Securities determines in its
discretion to be necessary or desirable for such purposes, as long as such
action does not materially adversely affect the interests of the Holders of the
Preferred Securities. The Property Trustee shall not be required to take any
action under this clause (d) unless directed to do so by the Depositor, the
Administrators or (subject to the provisions hereof) by Holders of not less than
a majority in Liquidation Amount of the Trust Securities.
SECTION 2.8. Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
SECTION 2.9. Title to Trust Property.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Trust and the Securityholders in
accordance with this Trust Agreement.
ARTICLE III
PAYMENT ACCOUNT
SECTION 3.1. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall establish
the Payment Account. The Property Trustee and any agent of the Property Trustee
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the
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purpose of making deposits in and withdrawals from the Payment Account in
accordance with this Trust Agreement. All moneys and other property deposited or
held from time to time in the Payment Account shall be held by the Property
Trustee in the Payment Account for the exclusive benefit of the Securityholders
and for distribution as herein provided, including (and subject to) any priority
of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on, and any other
payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
ARTICLE IV
DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions.
(a) Distributions (including Distributions of Additional Amounts, if
applicable) will be made on the Trust Securities at the rate and on the dates
that payments of interest (including Additional Amounts) are made on the
Debentures. Distributions on the Trust Securities shall be cumulative, and will
accumulate whether or not there are funds of the Trust available for the payment
of Distributions. Distributions shall accumulate from ____________, ____ and,
except in the event (and to the extent) that the Depositor exercises its right
to defer the payment of interest on the Debentures pursuant to the Indenture,
shall be payable semiannually on __________, and _________, of each year,
commencing on ____________, ____. If any date on which a Distribution is
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day that is a
Business Day or if such Business Day falls in the next calendar year, 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 this Section 4.1(a), a "Distribution Date"). Until ____________,
20__, in the event that any __________ or __________ is not a Business Day,
Distributions will be paid on the next succeeding Business Day, without any
interest or other payment with respect to any such delay. After ____________,
20__, Distributions shall be the amount of Distributions accumulated from, and
including, the last date on which Distributions have previously been paid, to,
but excluding, the Distribution Date.
(b) Assuming payments of interest on the Debentures are made when due (and
before giving effect to any Additional Amounts, if applicable), Distributions on
the Trust Securities shall be payable at a rate of ___% per annum of the
Liquidation Amount of the Trust Securities until ____________, 20__, and at the
Debenture Applicable Rate of the Liquidation Amount thereafter. The amount of
Distributions payable for any full period shall be computed on the basis of a
360-day year of twelve 30-day months until ____________, 20__, and thereafter on
the basis of a 360-day year and the actual number of days elapsed. The amount of
Distributions payable for any period shall include the Additional Amounts, if
any.
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(c) Distributions on the Trust Securities shall be made by the Property
Trustee from the Payment Account and shall be payable on each Distribution Date
only to the extent that the Trust has funds then on hand and available in the
Payment Account for the payment of such Distributions.
(d) Distributions on the Trust Securities with respect to a Distribution
Date shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be
the _____ day of the month [immediately prior to the month] in which the
relevant Distribution Date occurs.
SECTION 4.2. Redemption.
(a) On each Debenture Redemption Date and on the stated maturity of the
Debentures, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by
first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days
prior to the Redemption Date to each Holder of Trust Securities, at such
Holder's address appearing in the Security Register. All notices of redemption
shall state:
(i) the Redemption Date;
(ii) the Redemption Price or if the Redemption Price cannot be
calculated prior to the time the notice of redemption is required to be
sent, the manner of calculation thereof;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed; and
(v) that on the Redemption Date, the Redemption Price will become
due and payable upon each such Trust Security to be redeemed and that
Distributions thereon will cease to accumulate on and after said date.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption of
Debentures. Redemptions of the Trust Securities shall be made and the Redemption
Price shall be payable on each Redemption Date only to the extent that the Trust
has funds then on hand and available in the Payment Account for the payment of
such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 10:00 a.m., New York City time, on the Redemption
Date, the Depositor shall deposit sufficient funds with the Property Trustee to
pay the Redemption Price.
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If such deposit has been made, then, by 12:00 noon, New York City time, on the
Redemption Date, subject to Section 4.2(c), the Property Trustee will, so long
as the Preferred Securities are in book-entry-only form, irrevocably deposit
with the Clearing Agency for the Preferred Securities funds sufficient to pay
the applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the Holders thereof.
If Preferred Securities are no longer in book-entry-only form, the Property
Trustee, subject to Section 4.2(c), will irrevocably deposit with the Paying
Agent funds sufficient to pay the applicable Redemption Price and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price
with respect to such Preferred Securities to the Holders thereof upon surrender
of their Preferred Securities Certificates. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any Trust
Securities called for redemption shall be payable to the Holders of such Trust
Securities as they appear on the Securities Register for the Trust Securities on
the relevant record dates for the related Distribution. If notice of redemption
shall have been given and funds deposited as required, then upon the date of
such deposit, all rights of Securityholders holding Trust Securities so called
for redemption will cease, except the right of such Securityholders to receive
the Redemption Price and any unpaid Distribution payable on or prior to the
Redemption Date, but without interest, and such Trust Securities will cease to
be outstanding. In the event that any date on which any Redemption Price is
payable is not a Business Day, then payment of the Redemption Price payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next calendar year, such 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. In the event that payment of the Redemption
Price in respect of any Trust Securities called for redemption is improperly
withheld or refused and not paid either by the Trust or by the Depositor
pursuant to the Guarantee, Distributions on such Trust Securities will continue
to accumulate, at the then applicable rate, from the Redemption Date originally
established by the Trust for such Trust Securities to the date such Redemption
Price is actually paid, in which case the actual payment date will be the date
fixed for redemption for purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be made
to the recordholders thereof as they appear on the Securities Register for the
Trust Securities on a date to be established as the record date for the
distribution by the Administrators, which date shall be not more than 60 days
nor less than 30 days prior to the relevant Redemption Date.
(f) Subject to Section 4.3(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated on a
pro rata basis (based on Liquidation Amounts) among the Common Securities and
the Preferred Securities. The particular Preferred Securities to be redeemed
shall be selected on a pro rata basis (based upon Liquidation Amounts) not less
than 30 nor more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate. Any
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such proration may be based on the aggregate Liquidation Amount of Trust
Securities held by each Holder and in making any such proration the Property
Trustee may make such adjustments as may be appropriate in order that only Trust
Securities in Liquidation Amount equal to $_____ or integral multiples of $_____
in excess thereof shall be redeemed. The Property Trustee shall promptly notify
the Securities Registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
this Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Preferred Securities shall relate, in the case of
any Preferred Securities redeemed or to be redeemed only in part, to the portion
of the Liquidation Amount of Preferred Securities that has been or is to be
redeemed.
(g) 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 among the Holders of Trust Securities on the next
Distribution Date.
SECTION 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if applicable)
on, and the Redemption Price of, the Trust Securities, as applicable, shall be
made, subject to Section 4.2(f), pro rata among the Common Securities and the
Preferred Securities based on the Liquidation Amount of the Trust Securities;
provided, however, that if on any Distribution Date or Redemption Date any Event
of Default resulting from a Debenture Event of Default shall have occurred and
be continuing, no payment of any Distribution (including Additional Amounts, if
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities, for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities then called for
redemption, shall have been made or provided for, and all funds immediately
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions (including Additional Amounts, if applicable) on,
or the Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting from
any Debenture Event of Default, the Holder of Common Securities will be deemed
to have waived any right to act with respect to any such Event of Default under
this Trust Agreement until the effect of all such Events of Default with respect
to the Preferred Securities has been cured, waived or otherwise eliminated.
Until any such Event of Default under this Trust Agreement with respect to the
Preferred Securities has been so cured, waived or otherwise eliminated, the
Property Trustee shall act solely on behalf of the Holders of the Preferred
Securities and not the Holder of the Common Securities, and only the Holders of
the Preferred Securities will have the right to direct the Property Trustee to
act on their behalf.
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SECTION 4.4. Payment Procedures.
Payments of Distributions (including Additional Amounts, if applicable) in
respect of the Preferred Securities shall be made by check mailed to the address
of the Person entitled thereto as such address shall appear on the Securities
Register or, if the Preferred Securities are held by a Clearing Agency, such
Distributions shall be made to the Clearing Agency in immediately available
funds, which shall credit the relevant Persons' accounts at such Clearing Agency
on the applicable Distribution Dates. Payments in respect of the Common
Securities shall be made in such manner as shall be mutually agreed between the
Property Trustee and the Common Securityholder.
SECTION 4.5. Tax Returns and Reports.
The Administrators shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrators shall (a) prepare and file (or cause
to be prepared and filed) the appropriate Internal Revenue Service form required
to be filed in respect of the Trust in each taxable year of the Trust and (b)
prepare and furnish (or cause to be prepared and furnished) to each
Securityholder the appropriate Internal Revenue Service form required to be so
provided and furnished. The Administrators shall provide the Depositor and the
Property Trustee with a copy of all such returns and reports promptly after such
filing or furnishing. The Property Trustee shall comply with United States
federal withholding and backup withholding tax laws and information reporting
requirements with respect to any payments to Securityholders under the Trust
Securities.
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Debentures of Additional Sums and the written
direction of any of the Administrators, the Property Trustee shall promptly pay,
solely out of moneys on deposit pursuant to this Trust Agreement, any taxes,
duties or governmental charges of whatsoever nature (other than withholding
taxes) imposed on the Trust by the United States or any other taxing authority.
SECTION 4.7. Reduction for Payments under Indenture or Pursuant to Direct
Actions.
Any amount payable hereunder to any Holder of Preferred Securities shall be
reduced by the amount of any corresponding payment such Holder (or an Owner with
respect to the Holder's Preferred Securities) has directly received pursuant to
the Indenture or Section 5.14 of this Trust Agreement.
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ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. Initial Ownership.
Upon the creation of the Trust and the contribution by the Depositor
pursuant to Section 2.3 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
SECTION 5.2. The Trust Securities Certificates; Execution and Delivery
Thereof.
(a) The Preferred Securities Certificates shall be issued in minimum
denominations of $_____ Liquidation Amount and integral multiples thereof, and
the Common Securities Certificates shall be issued in denominations of $_____
Liquidation Amount and integral multiples thereof. The Trust Securities
Certificates shall be executed on behalf of the Trust by manual signature of at
least one Administrator and shall be dated their date of execution. Trust
Securities Certificates bearing the manual signatures of individuals who were,
at the time when such signatures shall have been affixed, authorized to sign on
behalf of the Trust, shall be validly issued and entitled to the benefits of
this Trust Agreement, notwithstanding that such individuals or any of them shall
have ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates. A transferee of a Trust Securities Certificate shall
become a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities Certificate in such transferee's name pursuant to Sections 5.4, 5.11
and 5.13.
(b) At the Closing Date, the Administrators, or any of them, shall cause
Trust Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.4 and 2.5, to be executed on behalf of the Trust and delivered to or
upon the written order of the Depositor, signed by its Chairman of the Board,
any Vice Chairman of the Board, its President, any Executive Vice President, its
Chief Operating Officer, its Chief Financial Officer, its Treasurer or any
Assistant Treasurer or its Controller, without further corporate action by the
Depositor, in authorized denominations.
SECTION 5.3. Transfer of Preferred Securities.
(a) Preferred Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Trust Agreement and
in the terms of the Preferred Securities. To the fullest extent permitted by
law, any transfer or purported transfer of any Preferred Security not made in
accordance with this Trust Agreement shall be null and void.
(b) Subject to this Section 5.3, Preferred Securities shall be freely
transferable; provided, however, that no transfer shall be effected unless such
transfer
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(whether by sale or any other disposition) is comprised of a block of Preferred
Securities having an aggregate Liquidation Amount of not less than $_____. Any
transfer, sale or other disposition of Preferred Securities in a block having a
Liquidation Amount of less than $_____ shall be deemed to be void and of no
legal effect whatsoever. Any such transferee shall be deemed not to be the
Holder of such Preferred Securities for any purpose, including but not limited
to the receipt of Distributions on such Preferred Securities, and such
transferee shall be deemed to have no interest whatsoever in such Preferred
Securities.
SECTION 5.4. Registration of Transfer and Exchange of Preferred Securities
Certificates.
The Depositor shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 5.8, a register for the purpose of registering
Trust Securities Certificates and transfers and exchanges of Preferred
Securities Certificates (the "Securities Register") in which the registrar
designated by the Depositor (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Preferred Securities Certificates and Common Securities Certificates (subject
to Section 5.10 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided. The Bank shall be the initial Securities Registrar. The
Securities Registrar shall not be required to register the transfer or exchange
of any Preferred Securities (i) during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Preferred Securities and ending at the close of business on the day of such
mailing or (ii) that have been selected for redemption in whole or in part,
except the unredeemed portion of any Preferred Security redeemed in part.
Upon surrender for registration of transfer of any Preferred Securities
Certificate at the office or agency maintained pursuant to Section 5.8, the
Administrators or any one of them shall execute and the Property Trustee shall
deliver, in the name of the designated transferee or transferees, one or more
new Preferred Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount dated the date of execution by such Administrator.
Subject to Section 5.11, at the option of a Holder, Preferred Securities
Certificates may be exchanged for other Preferred Securities Certificates in
authorized denominations of the same class and of a like aggregate Liquidation
Amount upon surrender of the Preferred Securities Certificates to be exchanged
at the office or agency maintained pursuant to Section 5.8.
Every Preferred Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Securities Registrar duly
executed by the Holder or his attorney duly authorized in writing. Each
Preferred Securities Certificate surrendered for registration of transfer or
exchange shall be canceled and subsequently disposed of by the Property Trustee
or the Securities Registrar in accordance with such Person's customary practice.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities Certificates, but the Securities Registrar may
require payment of a sum
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sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Preferred Securities Certificates.
SECTION 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be surrendered to
the Securities Registrar, or if the Securities Registrar shall receive evidence
to its satisfaction of the destruction, loss or theft of any Trust Securities
Certificate and (b) there shall be delivered to the Securities Registrar and the
Administrators such security or indemnity as may be required by them to save
each of them harmless, then in the absence of notice that such Trust Securities
Certificate shall have been acquired by a bona fide purchaser, the
Administrators, or any one of them, on behalf of the Trust shall execute and
make available for delivery, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Trust Securities Certificate, a new Trust Securities
Certificate of like class, tenor and denomination. In connection with the
issuance of any new Trust Securities Certificate under this Section, the
Administrators or the Securities Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith. Any duplicate Trust Securities Certificate issued pursuant
to this Section shall constitute conclusive evidence of an undivided beneficial
interest in the Trust Property, as if originally issued, whether or not the
lost, stolen or destroyed Trust Securities Certificate shall be found at any
time.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement of
mutilated, destroyed, lost or stolen Trust Securities.
SECTION 5.6. Persons Deemed Securityholders.
The Trustees, the Administrators or the Securities Registrar shall treat
the Person in whose name any Trust Securities Certificate shall be registered in
the Securities Register as the owner of such Trust Securities Certificate for
the purpose of receiving Distributions and for all other purposes whatsoever
(subject to the record date provisions hereof), and neither the Trustees nor the
Securities Registrar shall be bound by any notice to the contrary.
SECTION 5.7. Access to List of Securityholders' Names and Addresses.
At any time when the Property Trustee is not also acting as the Securities
Registrar, the Depositor shall furnish or cause to be furnished to the Property
Trustee, semiannually not more than five days after __________ and __________ of
each year beginning with _________, ____, and at such other times as the
Property Trustee may request in writing within 30 days after receipt by the
Depositor of any such request, a list, in such form as the Property Trustee may
reasonably require containing all information in the possession or control of
the Depositor, or any Paying Agent or any registrar of the Trust Securities
other than the Property Trustee, as to the names and addresses of the
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Securityholders obtained (in the case of each list other than the first list)
since the date as of which the next previous list was furnished. Any such list
may be dated as of a date not more than fifteen days prior to the time such
information is furnished or caused to be furnished, and need not include
information received after such date. The rights of Securityholders to
communicate with other Securityholders with respect to their rights under this
Trust Agreement or under the Trust Securities, and the corresponding obligations
and rights of the Property Trustee, shall be as provided in the Trust Indenture
Act. Each Holder, by receiving and holding a Trust Securities Certificate, and
each Owner shall be deemed to have agreed not to hold the Depositor, the
Property Trustee or the Administrators accountable by reason of the disclosure
of its name and address, regardless of the source from which such information
was derived.
SECTION 5.8. Maintenance of Office or Agency for Transfers.
The Administrators or the Property Trustee shall maintain an office or
offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Trust Securities Certificates
may be served. The Administrators initially designate The Chase Manhattan Bank,
450 West 33rd Street, New York, New York 10001, Attention: Corporate Trustee
Administration Department, as the office or agency for such purposes. The
Administrators or the Property Trustee shall give prompt written notice to the
Depositor and to the Securityholders of any change in the location of the
Securities Register or any such office or agency.
SECTION 5.9. Appointment of Paying Agent.
The Paying Agent shall make Distributions to Securityholders from the
Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrators. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account for the purpose of
making the Distributions referred to above. The Property Trustee may revoke such
power and remove the Paying Agent if such Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its obligations
under this Trust Agreement in any material respect. The Paying Agent shall
initially be the Bank, and any co-paying agent chosen by the Bank, and
acceptable to the Administrators and the Depositor. Any Person acting as Paying
Agent shall be permitted to resign as Paying Agent upon 30 days' written notice
to the Administrators, the Property Trustee and the Depositor. In the event that
the Bank shall no longer be the Paying Agent or a successor Paying Agent shall
resign or its authority to act be revoked, the Administrators shall appoint a
successor that is acceptable to the Property Trustee and the Depositor to act as
Paying Agent (which shall be a bank or trust company). The Administrators shall
cause such successor Paying Agent or any additional Paying Agent appointed by
the Administrators to execute and deliver to the Trustees an instrument in which
such successor Paying Agent or additional Paying Agent shall agree with the
Trustees that as Paying Agent, such successor Paying Agent or additional Paying
Agent will hold all sums, if any, held by it for payment to the Securityholders
in trust for the benefit of the Securityholders entitled thereto until such sums
shall be paid to such
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Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 8.2, 8.4 and 8.6 herein shall apply to the Bank also in its role as
Paying Agent, for so long as the Bank shall act as Paying Agent and, to the
extent applicable, to any other paying agent appointed hereunder. Any reference
in this Trust Agreement to the Paying Agent shall include any co-paying agent
unless the context requires otherwise.
SECTION 5.10. Ownership of Common Securities by Depositor.
At the Closing Date, the Depositor shall acquire and retain beneficial and
record ownership of the Common Securities. To the fullest extent permitted by
law, other than transactions permitted by Article XI of the Indenture, any
attempted transfer of the Common Securities shall be void. The Administrators
cause the Common Securities Certificate issued to the Depositor to contain a
legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS DESCRIBED IN THE
TRUST AGREEMENT (AS DEFINED BELOW)."
SECTION 5.11. Book-Entry Interests.
(a) So long as Preferred Securities are eligible for book-entry settlement
with the Clearing Agency or unless otherwise required by law, all Preferred
Securities that are so eligible will be represented by one or more fully
registered Preferred Securities Certificates (each a "Book Entry Preferred
Securities Certificate") in global form to be delivered to the Clearing Agency
or its custodian, by, or on behalf of, the Trust. Such Book Entry Preferred
Securities Certificates shall initially be registered on the Securities Register
in the name of Cede & Co., the nominee of DTC, and no Owner will receive a
Definitive Preferred Securities Certificate representing such Owner's interests
in such Book Entry Preferred Securities Certificates, except as provided in
Section 5.11(d) below. The transfer and exchange of beneficial interests in any
such Preferred Security in global form shall be effected through the Clearing
Agency in accordance with this Trust Agreement and the procedures of the
Clearing Agency therefor.
(b) Except as provided in subparagraph (d) of this Section 5.11, Owners of
a Preferred Security in global form shall not be entitled to have certificates
registered in their names, will not receive or be entitled to receive physical
delivery of certificates in definitive form and will not be considered Holders
of such Preferred Securities in global form.
(c) Any Book Entry Preferred Securities Certificate may be endorsed with or
have incorporated in the text thereof such legends or recitals or changes as may
be required by the Clearing Agency or any securities exchange, interdealer
quotation system or self-regulatory organization upon which the Preferred
Securities may be listed or traded or to conform with any usage with respect
thereto, or to indicate any special limitations or restrictions to which any
particular Preferred Securities are subject.
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(d) Notwithstanding any other provisions of this Trust Agreement (other
than the provisions set forth in this Section 5.11(d)), a Preferred Security in
global form may not be exchanged in whole or in part for Preferred Securities
registered, and no transfer of a Preferred Security in global form may be
registered, in the name of any Person other than the Clearing Agency or nominee
thereof unless (i) such Clearing Agency (A) has notified the Property Trustee
and the Depositor that it is unwilling or unable to continue as Clearing Agency
for such global Preferred Security and the Depositor on behalf of the Trust
thereupon fails to appoint a successor Clearing Agency within 90 days after the
receipt of such notice or (B) has ceased to be a clearing agency registered as
such under the Exchange Act, (ii) the Depositor in its sole discretion elects to
cause the issuance of the Preferred Securities in certificated form or (iii)
there shall have occurred and be continuing an Event of Default, or any event
which after notice or lapse of time or both would be an Event of Default under
the Trust Agreement, with respect to such global Preferred Security. Following
exchange of a global Preferred Security, or a portion thereof, for a definitive
Preferred Security, no such definitive Preferred Security, or portion thereof,
shall be included in any Book Entry Preferred Securities Certificate.
Unless and until Definitive Preferred Securities Certificates have been
issued to Owners pursuant to Section 5.13:
(i) the provisions of this Section 5.11(d) shall be in full force
and effect;
(ii) the Securities Registrar, the Administrators and the Trustees
shall be entitled to deal with the Clearing Agency for all purposes of
this Trust Agreement relating to the Book-Entry Preferred Securities
Certificates (including the payment of the Liquidation Amount of and
Distributions on the Preferred Securities evidenced by Book-Entry
Preferred Securities and the giving of instructions or directions to
Owners of Preferred Securities evidenced by Book-Entry Preferred
Securities) as the sole Holder of Preferred Securities evidenced by
Book-Entry Preferred Securities and shall have no obligations to the
Owners thereof;
(iii) to the extent that the provisions of this Section 5.11
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry Preferred
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless
and until Definitive Preferred Securities Certificates are issued
pursuant to Section 5.13, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments on the Preferred Securities to such Clearing
Agency Participants.
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(e) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
SECTION 5.12. Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Trust Agreement, unless and until Definitive Preferred
Securities Certificates shall have been issued to Owners pursuant to Section
5.13, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
SECTION 5.13. Procedures for Issuance of Definitive Preferred Securities
Certificates.
Upon surrender to the Securities Registrar of the typewritten Preferred
Securities Certificate or Certificates representing the Book Entry Preferred
Securities Certificates by the Clearing Agency upon occurrence of any of the
events described in Section 5.11(d), accompanied by registration instructions,
the Administrators, or any one of them, shall execute and the Securities
Registrar shall register the Definitive Preferred Securities Certificates in
accordance with the instructions of the Clearing Agency. Neither the Securities
Registrar nor the Trustees nor the Administrators shall be liable for any delay
in delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Preferred Securities Certificates, the Trustees and the Administrators shall
recognize the Holders of the Definitive Preferred Securities Certificates as
Securityholders. The Definitive Preferred Securities Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrators, as evidenced by the execution
thereof by the Administrators or any one of them.
SECTION 5.14. Rights of Securityholders.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.9, and
the Securityholders shall not have any right or title therein other than the
undivided beneficial ownership interest in the assets of the Trust conferred by
their Trust Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust Agreement. The Trust Securities
shall have no preemptive or similar rights. When issued and delivered to
Securityholders against payment of the purchase price therefor, the Preferred
Securities will be fully paid and nonassessable undivided beneficial interests
in the Trust Property. The Holders of the Preferred Securities, in their
capacities as such, 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.
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(b) For so long as any Preferred Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the holders of not
less than 25% in principal amount of the outstanding Debentures fail to declare
the principal of all of the Debentures to be immediately due and payable, the
Holders of at least 25% in Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Depositor and
the Debenture Trustee; and upon any such declaration such principal amount of
and the accrued interest on all of the Debentures shall become immediately due
and payable as set forth in the Indenture, provided that the payment of
principal, premium and interest on such Debentures shall remain subordinated to
the extent provided in the Indenture.
At any time after such a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as provided in the
Indenture, the Holders of a majority in Liquidation Amount of the Preferred
Securities, by written notice to the Property Trustee, the Depositor and the
Debenture Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Depositor has paid or deposited with the Debenture Trustee
a sum sufficient to pay:
(A) all overdue installments of interest (including
any Additional Amounts (as defined in the Indenture)), if any,
on all of the Debentures;
(B) the principal of (and premium, if any, on) any
Debentures which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Debentures; and
(C) all sums paid or advanced by the Debenture Trustee
under the Indenture and the reasonable compensation, expenses,
disbursements and advances of the Debenture Trustee and the
Property Trustee, their agents and counsel and the amounts
payable to the Debenture Trustee under Section 7.06 of the
Indenture; and
(ii) all Debenture Events of Default, other than the non-payment
of the principal of the Debentures which has become due solely by such
acceleration, have been cured or waived as provided in Article VI of
the Indenture.
The Holders of a majority in aggregate Liquidation Amount of the Preferred
Securities may, on behalf of the Holders of all the Preferred Securities, waive
any past default under the Indenture, except a default in the payment of
principal 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 Debenture.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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Upon receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of the Preferred
Securities all or part of which is represented by Book-Entry Preferred
Securities Certificates, a record date shall be established for determining
Holders of Outstanding Preferred Securities entitled to join in such notice,
which record date shall be at the close of business on the day the Property
Trustee receives such notice. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission and
annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect. Nothing in
this paragraph shall prevent a Holder, or a proxy of a Holder, from giving,
after expiration of such 90-day period, a new written notice of declaration of
acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice which has been canceled pursuant to the proviso to
the preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 5.14(b).
(c) For so long as any Preferred Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a Debenture Event of Default specified in Section
6.01(a) or 6.01(b) of the Indenture, any Holder of Preferred Securities shall
have the right to institute a proceeding directly against the Depositor,
pursuant to Article VI of the Indenture, for enforcement of payment to such
Holder of the principal amount of interest on Debentures having a principal
amount equal to the Liquidation Amount of the Preferred Securities of such
Holder (a "Direct Action"). Except as set forth in Section 5.14(b) and this
Section 5.14(c), the Holders of Preferred Securities shall have no right to
exercise directly any right or remedy available to the holders of, or in respect
of, the Debentures.
SECTION 5.15. CUSIP Numbers.
The Administrators 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; 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 Administrators will promptly notify the Property Trustee of any
change in the CUSIP numbers.
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ARTICLE VI
ACTS OF SECURITYHOLDERS; MEETINGS; VOTING
SECTION 6.1. Limitations on Voting Rights.
(a) Except as provided in this Section, in Sections 5.14, 8.10 and 10.2 and
in the Indenture, and as otherwise required by law, no Holder of Preferred
Securities shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Trust Securities Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee, the
Property Trustee shall not (i) direct the time, method or 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 such
Debentures, (ii) waive any past default which is waivable under the Indenture,
(iii) exercise any right to rescind or annul a declaration that the principal of
all the Debentures shall be due and payable 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 at least a majority in Liquidation Amount of all Outstanding
Preferred Securities; provided, however, that where a consent under the
Indenture would require the consent of each holder of Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior written consent of each Holder of Preferred Securities. The Property
Trustee shall not revoke any action previously authorized or approved by a vote
of the Holders of Preferred Securities, except by a subsequent vote of the
Holders of Preferred Securities. Subject to Section 8.3, the Property Trustee
shall notify all Holders of the Preferred Securities of any notice of default
received from the Debenture Trustee with respect to the Debentures. In addition
to obtaining the foregoing approvals of the Holders of the Preferred Securities,
prior to taking any of the foregoing actions, the Property Trustee shall, at the
expense of the Depositor, obtain an Opinion of Counsel to the effect that such
action shall not cause the Trust to be classified as an association taxable as a
corporation or as other than a grantor trust for United States federal income
tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely affect
in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities, except as otherwise provided in
Section 10.2(c). Notwithstanding any other provision of this Trust Agreement, no
amendment to this Trust Agreement may be made
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if, as a result of such amendment, it would cause the Trust to be classified as
an association taxable as a corporation or as other than a grantor trust for
United States federal income tax purposes.
The Holders of a majority in Liquidation Amount of the Preferred 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 Property
Trustee, or exercising any trust or power conferred on the Property Trustee with
respect to such Preferred Securities; provided, however, that, the Property
Trustee shall have the right to decline to follow any such direction if the
Property Trustee being advised by Opinion of Counsel determines that the action
so directed may not lawfully be taken, or if the Property Trustee in good faith
shall determine that the proceedings so directed would be illegal or involve it
in personal liability or be unduly prejudicial to the rights of Holders of
Preferred Securities not parties to such direction, and provided further that
nothing in the Trust Agreement shall impair the right of the Property Trustee to
take any action deemed proper by the Property Trustee and which is not
inconsistent with such direction by such Securityholders.
SECTION 6.2. Notice of Meetings.
Notice of all meetings of the Preferred Securityholders, stating the time,
place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 10.8 to each Preferred Securityholder of record, at his
registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
SECTION 6.3. Meetings of Preferred Securityholders.
No annual meeting of Securityholders is required to be held. The Property
Trustee, however, shall call a meeting of Preferred Securityholders to vote on
any matter upon the written request of the Preferred Securityholders of record
of at least 25% of the Preferred Securities (based upon their aggregate
Liquidation Amount) and the Administrators or the Property Trustee may, at any
time in their discretion, call a meeting of Preferred Securityholders to vote on
any matters as to which Preferred Securityholders are entitled to vote.
Preferred Securityholders of record of at least 50% of the Outstanding
Preferred Securities (based upon their Liquidation Amount), present in person or
by proxy, shall constitute a quorum at any meeting of Preferred Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Preferred
Securityholders of record present, in person or by proxy, holding at least a
majority of the Preferred Securities (based upon their Liquidation Amount) held
by the Preferred Securityholders of record present, either in person or by
proxy, at such meeting shall constitute the action of the Preferred
Securityholders, unless this Trust Agreement requires a greater number of
affirmative votes.
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SECTION 6.4. Voting Rights.
Securityholders shall be entitled to one vote for each $_____ of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
SECTION 6.5. Proxies, Etc.
At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Property Trustee, or with such
other officer or agent of the Trust as the Property Trustee may direct, for
verification prior to the time at which such vote shall be taken. Pursuant to a
resolution of the Property Trustee, proxies may be solicited in the name of the
Property Trustee or one or more officers of the Property Trustee. Only
Securityholders of record shall be entitled to vote. When Trust Securities are
held jointly by several Persons, any one of them may vote at any meeting in
person or by proxy in respect of such Trust Securities, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Trust Securities. A proxy purporting to
be executed by or on behalf of a Securityholder shall be deemed valid unless
challenged at or prior to its exercise, and the burden of proving invalidity
shall rest on the challenger. No proxy shall be valid more than three years
after its date of execution.
SECTION 6.6. Securityholder Action by Written Consent.
Any action which may be taken by Securityholders at a meeting may be taken
without a meeting if Securityholders holding a majority of all Outstanding Trust
Securities (based upon their aggregate Liquidation Amount) entitled to vote in
respect of such action (or such larger proportion thereof as shall be required
by any express provision of this Trust Agreement) shall consent to the action in
writing.
SECTION 6.7. Record Date for Voting and Other Purposes.
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or to vote by written consent, or to
participate in any Distribution on the Trust Securities in respect of which a
record date is not otherwise provided for in this Trust Agreement, or for the
purpose of any other action, the Administrators may from time to time fix a
date, not more than 90 days prior to the date of any meeting of Securityholders
or the payment of a Distribution or other action (including action to be taken
by written consent), as the case may be, as a record date for the determination
of the identity of the Securityholders of record for such purposes.
SECTION 6.8. Acts of Securityholders.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Trust Agreement to be given, made or
taken by
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Securityholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Securityholders in person or by an
agent duly appointed in writing; and, except as otherwise expressly provided
herein, such action shall become effective when such instrument or instruments
representing the requisite number of Securityholders (based upon Liquidation
Amounts) are delivered to the Property Trustee. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Securityholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Trust
Agreement and (subject to Section 8.2) conclusive in favor of the Trustees, if
made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise among the Securityholders and the Administrators
or among such Securityholders or Trustees with respect to the authenticity,
validity or binding nature of any request, demand, authorization, direction,
consent, waiver or other Act of such Securityholder or Administrators under this
Article VI, then the determination of such matter by the Property Trustee shall
be conclusive with respect to such matter.
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SECTION 6.9. Inspection of Records.
Upon reasonable notice to the Administrators and the Property Trustee, the
records of the Trust shall be open to inspection by Securityholders during
normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee and the
Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally on behalf of
and as to itself, hereby represents and warrants for the benefit of the
Depositor and the Securityholders that:
(a) the Property Trustee is a banking corporation duly organized, validly
existing and in good standing under the laws of the State of New York;
(b) the Property Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware banking corporation duly organized,
validly existing and in good standing with its principal place of business in
the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and delivered
by the Property Trustee and the Delaware Trustee and constitutes the valid and
legally binding agreement of each of the Property Trustee and the Delaware
Trustee enforceable against each of them in accordance with its terms, 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;
(f) the execution, delivery and performance of this Trust Agreement have
been duly authorized by all necessary corporate or other action on the part of
the Property Trustee and the Delaware Trustee and do not require any approval of
stockholders of the Property Trustee and the Delaware Trustee and such
execution, delivery and performance will not (i) violate the Charter or By-laws
of the Property Trustee or the Delaware Trustee, or
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(ii) violate any law, governmental rule or regulation of the State of New York
or the State of Delaware, as the case may be, governing the banking or trust
powers of the Property Trustee or the Delaware Trustee (as appropriate in
context) or any order, judgment or decree applicable to the Property Trustee or
the Delaware Trustee; and
(g) neither the authorization, execution or delivery by the Property
Trustee or the Delaware Trustee of this Trust Agreement nor the consummation of
any of the transactions by the Property Trustee or the Delaware Trustee (as
appropriate in context) contemplated herein or therein requires the consent or
approval of, the giving of notice to, the registration with or the taking of any
other action with respect to any governmental authority or agency under any
existing State of New York or State of Delaware law governing the banking or
trust powers of the Property Trustee or the Delaware Trustee, as the case may
be.
Any successor Property Trustee and Delaware Trustee shall make similar
representations and warranties as contained in this Section 7.1 for the benefit
of the Depositor and the Securityholders.
SECTION 7.2. Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the
Securityholders that:
(a) the Trust Securities Certificates issued at the Closing Date on behalf
of the Trust have been duly authorized and will have been duly and validly
executed, issued and delivered by the Administrators pursuant to the terms and
provisions of, and in accordance with the requirements of, this Trust Agreement
and the Securityholders will be, as of each such date, entitled to the benefits
of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by the
Trust (or the Trustees on behalf of the Trust) under the laws of the State of
Delaware or any political subdivision thereof in connection with the execution,
delivery and performance by the Property Trustee or the Delaware Trustee, as the
case may be, of this Trust Agreement.
ARTICLE VIII
THE TRUSTEES AND ADMINISTRATORS
SECTION 8.1. Corporate Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder with respect
to the Trust Securities. The Property Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If
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at any time the Property Trustee with respect to the Trust Securities shall
cease to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
(b) There shall at all times be one or more Administrators hereunder with
respect to the Trust Securities, who shall be appointed by the Holder of Common
Securities. Each Administrator 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 persons
authorized to bind that entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity.
SECTION 8.2. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be as provided by
this Trust Agreement and, in the case of the Property Trustee, by the Trust
Indenture Act and no implied covenants or obligations shall be read into this
Trust Agreement against the Property Trustee. Notwithstanding the foregoing, no
provision of this Trust Agreement shall require the Trustees to expend or risk
their own funds or otherwise incur any financial liability in the performance of
any of their duties hereunder, or in the exercise of any of their rights or
powers, if they shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to them. In the absence of bad faith on its part, the
Property Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Property Trustee and conforming to the requirements of this
Trust Agreement. Whether or not therein expressly so provided, every provision
of this Trust Agreement relating to the conduct or affecting the liability of or
affording protection to the Trustees shall be subject to the provisions of this
Section. Nothing in this Trust Agreement shall be construed to release an
Administrator or the Delaware Trustee from liability for his own gross
negligence or willful misconduct. To the extent that, at law or in equity, an
Administrator or the Delaware Trustee has duties (including fiduciary duties)
and liabilities relating thereto to the Trust or to the Securityholders, such
Administrator and the Delaware Trustee shall not be liable to the Trust or any
other Trustee or to any Securityholder for such Administrator's or the Delaware
Trustee's good faith reliance on the provisions of this Trust Agreement. The
provisions of this Trust Agreement, to the extent that they restrict the duties
and liabilities of the Administrators and the Delaware Trustee otherwise
existing at law or in equity, are agreed by the Depositor, the Trustees and the
Securityholders to replace such other duties and liabilities of the
Administrators and the Delaware Trustee.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the
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Trust Property to enable the Property Trustee or a Paying Agent to make payments
in accordance with the terms hereof. Each Securityholder, by its acceptance of a
Trust Security, agrees that it will look solely to the revenue and proceeds from
the Trust Property to the extent legally available for distribution to it as
herein provided and that the Trustees are not personally liable to it for any
amount distributable in respect of any Trust Security or for any other liability
in respect of any Trust Security. This Section 8.2(b) does not limit the
liability of the Trustees expressly set forth elsewhere in this Trust Agreement
or, in the case of the Property Trustee, in the Trust Indenture Act.
(c) No provision of this Trust Agreement 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) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(ii) 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 Preferred Securities or the Common 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 Trust
Agreement;
(iii) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Trust Property
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 Trust Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest on
any money received by it except as it may otherwise agree with the
Depositor; and money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Payment Account maintained by the Property Trustee pursuant to Section
3.1 and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring
the compliance by the Administrators or the Depositor with their
respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the default or misconduct of any Administrator or
the Depositor.
SECTION 8.3. Certain Notices.
Within five Business Days after the occurrence of any Event of Default
actually known to an officer of the Property Trustee assigned to its Corporate
Trust Office, the Property Trustee shall transmit, in the manner and to the
extent provided in Section 10.8,
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notice of such Event of Default to the Securityholders, the Administrators and
the Depositor, unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the Depositor's
exercise of its right to defer the payment of interest on the Debentures
pursuant to the Indenture, the Property Trustee shall transmit, in the manner
and to the extent provided in Section 10.8, notice of such exercise to the
Securityholders, unless such exercise shall have been revoked.
SECTION 8.4. Certain Rights of Property Trustee.
Subject to the provisions of Section 8.2:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of indebtedness 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) if (i) in performing its duties under this Trust Agreement the Property
Trustee is required to decide between alternative courses of action or (ii) in
construing any of the provisions of this Trust Agreement the Property Trustee
finds the same ambiguous or inconsistent with any other provisions contained
herein or (iii) the Property Trustee is unsure of the application of any
provision of this Trust Agreement, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this Trust
Agreement, the Property Trustee shall deliver a notice to the Depositor
requesting written instructions of the Depositor as to the course of action to
be taken and the Property Trustee shall take such action, or refrain from taking
such action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, however, that if the
Property Trustee does not receive such instructions of the Depositor within ten
Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) any direction or act of the Depositor or the Administrators
contemplated by this Trust Agreement shall be sufficiently evidenced by an
Officers' Certificate or a certificate signed by any Administrator;
(d) whenever in the administration of this Trust Agreement, the Property
Trustee shall deem it desirable that a matter be established before undertaking,
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 rely upon an
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Officers' Certificate which, upon receipt of such request, shall be promptly
delivered by the Depositor or the Administrators;
(e) 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 reregistration thereof;
(f) the Property Trustee may consult with counsel (which counsel may be
counsel to the Depositor or any of its Affiliates, and may include any of its
employees) and the advice of such 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 reliance thereon and in accordance with
such advice; the Property Trustee shall have the right at any time to seek
instructions concerning the administration of this Trust Agreement from any
court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(h) 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, consent, order, approval, bond,
debenture, note or other evidence of indebtedness or other paper or document,
unless requested in writing to do so by one or more Securityholders, but the
Property Trustee may make such further inquiry or investigation into such facts
or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents or
attorneys, provided that the Property Trustee shall not be responsible for any
misconduct or negligence on the part of, or for the supervision of, any such
agent or attorney appointed with due care by it hereunder;
(j) whenever in the administration of this Trust Agreement 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 of the Trust Securities
which instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust 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 acting in accordance with such instructions;
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(k) except as otherwise expressly provided by this Trust Agreement, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Trust Agreement; and
(l) the Property Trustee shall not be charged with knowledge of an Event of
Default unless an officer of the Property Trustee assigned to its Corporate
Trust Office obtains actual knowledge of such event or the Property Trustee
receives written notice of such event from the Depositor, any Trustee or
Administrator or Securityholders.
No provision of this Trust Agreement 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 8.5. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
SECTION 8.6. May Hold Securities.
Any Trustee or any other agent of any Trustee or the Trust, in its
individual or any other capacity, may become the owner or pledgee of Trust
Securities and, subject to Section 8.8 and to Section 311 of the Trust Indenture
Act and except as provided in the definition of the term "Outstanding" in
Article I, may otherwise deal with the Trust with the same rights it would have
if it were not a Trustee or such other agent.
SECTION 8.7. Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to the Trustees from time to time reasonable compensation for
all services rendered by them hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust);
(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 Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith;
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(c) to the fullest extent permitted by applicable law, to indemnify and
hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee, (iii) any
officer, director, shareholder, employee, representative or agent of any
Trustee, and (iv) any employee or agent of the Trust or its Affiliates,
(referred to herein as an "Indemnified Person") from and against any loss,
damage, liability, tax, penalty, expense or claim of any kind or nature
whatsoever incurred without gross negligence (or in the case of the Property
Trustee, 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 of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder; and
(d) to the fullest extent permitted by applicable law, to advance expenses
(including legal fees) incurred by an Indemnified Person in defending any claim,
demand, action, suit or proceeding which shall be advanced, from time to time,
prior to the final disposition of such claim, demand, action, suit or proceeding
upon receipt by the Depositor of (x) a written affirmation by or on behalf of
the Indemnified Person of its or his good faith belief that it or he has met the
standard of conduct set forth in this Section 8.7 and (y) an undertaking by or
on behalf of the Indemnified Person to repay such amount if it shall be
determined that the Indemnified Person is not entitled to be indemnified as
authorized in the preceding subsection.
The provisions of this Section 8.7 shall survive the termination of this
Trust Agreement and the resignation or removal of any Trustee.
No Trustee may claim any lien or charge on any Trust Property as a result
of any amount due pursuant to this Section 8.7.
The Depositor, any Administrator and any Trustee (in the case of the
Property Trustee, subject to Section 8.8 hereof) 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 of Trust Securities shall have no rights by virtue of this
Trust Agreement 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. Neither the
Depositor, any Administrator nor any 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 the Depositor, any Administrator or any 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 Trustee may
engage or be interested in any financial or other transaction with the Depositor
or any Affiliate of the Depositor, or may act as depository for, trustee or
agent for, or act on any committee or body of holders of, securities or other
obligations of the Depositor or its Affiliates.
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SECTION 8.8. Conflicting Interests.
If the Property Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement. The Guarantee; the Indenture and the securities issued or to be
thereunder; any Preferred Securities Guarantee Agreement relating to a Bear
Stearns Trust (as defined in the Indenture and the Existing Indenture) between
the Depositor and The Chase Manhattan Bank, as guarantee trustee; any Amended
and Restated Trust Agreement relating to a Bear Stearns Trust among the
Depositor, as depositor, The Chase Manhattan Bank, as property trustee, Chase
Manhattan Bank Delaware, as Delaware trustee, the administrators named therein
and the several holders; and the Existing Indenture and the securities issued or
to be issued thereunder shall be deemed to be sufficiently described in this
Trust Agreement for the purposes of clause (i) of the first proviso contained in
Section 310(b) of the Trust Indenture Act.
SECTION 8.9. Co-Trustees and Separate Trustee.
Unless a Debenture Event of Default shall have occurred and be continuing,
at any time or times, for the purpose of conforming to the legal requirements of
the Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Depositor and the Administrators,
except in such instance as set forth in the following sentence, by agreed action
of a majority of such Administrators, shall have the power to appoint, and upon
the written request of the Administrators, the Depositor shall for such purpose
join with the Administrators in the execution, delivery, and performance of all
instruments and agreements necessary or proper to appoint one or more Persons
approved by the Property Trustee either to act as co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to the extent
required by law 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 the capacity aforesaid, any property, title,
right or power deemed necessary or desirable, subject to the other provisions of
this Section. If the Depositor does not join in such appointment within 15 days
after the receipt by it of a request so to do, or in case a Debenture Event of
Default has occurred and is continuing, the Property Trustee alone shall have
power to make such appointment. Any co-trustee or separate trustee appointed
pursuant to this Section shall either be (i) a natural person who is at least 21
years of age and a resident of the United States or (ii) a legal entity with its
principal place of business in the United States that shall act through one or
more persons authorized to bind such entity.
Should any written instrument from the Depositor be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged and delivered
by the Depositor.
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Every co-trustee or separate trustee shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Trust Securities shall be delivered and all rights, powers, duties,
and obligations hereunder in respect of the custody of securities, cash and
other personal property held by, or required to be deposited or pledged with,
the Trustees specified hereunder, shall be exercised, solely by such Trustees
and not by such co-trustee or separate trustee.
(b) The rights, powers, duties, and obligations hereby conferred or imposed
upon the Property Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed by the Property
Trustee or by the Property Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Property Trustee shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties and obligations shall be exercised and performed by such
co-trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in writing executed
by it, with the written concurrence of the Depositor, may accept the resignation
of or remove any co-trustee or separate trustee appointed under this Section,
and, in case a Debenture Event of Default has occurred and is continuing, the
Property Trustee shall have power to accept the resignation of, or remove, any
such co-trustee or separate trustee without the concurrence of the Depositor.
Upon the written request of the Property Trustee, the Depositor shall join with
the Property Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such resignation or
removal. A successor to any co-trustee or separate trustee so resigned or
removed may be appointed in the manner provided in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally liable
by reason of any act or omission of the Property Trustee or any other trustee
hereunder.
(e) The Property Trustee shall not be liable by reason of any act of a
co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
SECTION 8.10. Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
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Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time by giving written notice thereof to the Securityholders. If
the instrument of acceptance by the successor Trustee required by Section 8.11
shall not have been delivered to the Relevant Trustee within 60 days after the
giving of such notice of resignation, the Relevant Trustee may petition, at the
expense of the Trust, any court of competent jurisdiction for the appointment of
a successor Relevant Trustee.
Unless a Debenture 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 a Debenture Event of Default has occurred and is continuing, the Property
Trustee or the Delaware Trustee, or both of them, may be removed by Act of the
Holders of a majority in Liquidation Amount of the Preferred Securities,
delivered to the Relevant Trustee (in its individual capacity and on behalf of
the Trust). In no event will the Holders of the Preferred Securities have the
right to vote to appoint, remove or replace the Administrators, which voting
rights are vested exclusively in the Depositor, as Holder of the Common
Securities.
If any Trustee shall resign, be removed or become incapable of acting as
Trustee, or if a vacancy shall occur in the office of any Trustee for any cause,
at a time when no Debenture Event of Default shall have occurred and be
continuing, the Holder of the Common Securities, by Act of the Holder of the
Common Securities, delivered to the retiring Trustee, shall promptly appoint a
successor Trustee or Trustees, and the retiring Trustee shall comply with the
applicable requirements of Section 8.11. If any Trustee shall resign, be removed
or become incapable of acting as Trustee, at a time when a Debenture Event of
Default Exists, the Holders of the Preferred Securities, by Act of the Holders
of a majority in Liquidation Amount of the Preferred Securities then Outstanding
delivered to the retiring Relevant Trustee, shall promptly appoint a successor
Relevant Trustee or Trustees, and each successor Trustee shall comply with the
applicable requirements of Section 8.11. If an Administrator shall resign, be
removed or become incapable of acting as Administrator, the Holder of Common
Securities by Act of the Holder of Common Securities delivered to the
Administrator shall promptly appoint a successor Administrator or Administrators
and such successor Administrator or Administrators shall comply with the
applicable requirements of Section 8.11. If no successor Relevant Trustee shall
have been so appointed by the Holder of the Common Securities or the Holders of
the Preferred Securities and accepted appointment in the manner required by
Section 8.11, any Holder who has been a Holder of Trust Securities for at least
six months may, on behalf of himself and all other similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Relevant
Trustee.
The Property Trustee shall give notice of each resignation and each removal
of a Trustee and each appointment of a successor Trustee to all Securityholders
in the manner provided in Section 10.8 and shall give notice to the Depositor.
Each notice shall include the name of the successor Relevant Trustee and the
address of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrator or a Delaware Trustee who is a natural
person dies or becomes,
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in the opinion of the Depositor, incompetent or incapacitated, the vacancy
created by such death, incompetence or incapacity may be filled by (a) the
unanimous act of remaining Administrators if there are at least two of them
prior to such vacancy or (b) otherwise by the Depositor (with the successor in
each case being a Person who satisfies the eligibility requirement for
Administrators or Delaware Trustee, as the case may be, set forth in Section
8.1).
SECTION 8.11. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant Trustee, the
retiring Relevant Trustee and each successor Relevant Trustee shall execute and
deliver an amendment hereto wherein each successor Relevant Trustee shall accept
such appointment and which shall contain such provisions as shall be necessary
or desirable to transfer and confirm to, and to vest in, each successor Relevant
Trustee all the rights, powers, trusts and duties of the retiring Relevant
Trustee with respect to the Trust Securities and the Trust. Upon the execution
and delivery of such amendment the resignation or removal of the retiring
Relevant Trustee shall become effective to the extent provided therein and each
such successor Relevant Trustee, without any further act, deed or conveyance,
shall become vested with all the rights, powers, trusts and duties of the
retiring Relevant Trustee; but, on request of the Trust or any successor
Relevant Trustee such retiring Relevant Trustee shall, upon payment of its
charges, duly assign, transfer and deliver to such successor Relevant Trustee
all Trust Property, all proceeds thereof and money held by such retiring
Relevant Trustee hereunder with respect to the Trust Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the preceding paragraph.
No successor Relevant Trustee shall accept its appointment unless at the
time of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
SECTION 8.12. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee 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 Relevant
Trustee shall be a party, or any Person succeeding to all or substantially all
the corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee 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.
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SECTION 8.13. 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
Trust Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions or
other amounts due on the Trust 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 or such other amounts) 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 and
other amounts owing and unpaid in respect of the Trust 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 under Section 8.7.
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 composition affecting the Trust
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.
SECTION 8.14. Reports by Property Trustee.
(a) Not later than January 15 of each year commencing with January 15,
____, the Property Trustee shall transmit to all Securityholders in accordance
with Section 10.8, and to the Depositor, a brief report dated as of the
immediately preceding November 15 concerning the Property Trustee and its
actions under this Trust Agreement if and as may be required pursuant to Section
313(a) of the Trust Indenture Act.
(b) In addition, the Property Trustee shall transmit to Securityholders
such other reports concerning the Property Trustee and its actions under this
Trust Agreement as would be required pursuant to the Trust Indenture Act were
this Trust Agreement to be
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qualified under the Trust Indenture Act at the times and in the manner provided
pursuant thereto.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with any exchange, interdealer
quotation system or self-regulatory organization upon which the Trust Securities
are designated for trading, and with the Depositor. The Depositor will notify
the Property Trustee when and as the Preferred Securities become so designated
for trading.
SECTION 8.15. Reports to the Property Trustee.
The Depositor and the Administrator on behalf of the Trust shall provide to
the Property 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(a)(4) of the Trust Indenture Act in the form, in the
manner and at the times required by Section 314 of the Trust Indenture Act, such
compliance certificate to be delivered annually on or before September 15 of
each year beginning in ____.
SECTION 8.16. Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrator on behalf of the Trust shall
provide to the Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) of the Trust Indenture Act shall be given in the form of an Officers'
Certificate.
SECTION 8.17. Number of Trustees.
(a) The number of Trustees shall be two. The Property Trustee and the
Delaware Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason the vacancy shall be
filled with a Trustee appointed in accordance with the provisions of Section
8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of a Trustee shall not operate to dissolve,
terminate or annul the Trust.
SECTION 8.18. Delegation of Power.
(a) Any Administrator 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 2.7(a) or
mailing any other governmental filing; and
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(b) The Administrator shall have power to delegate from time to time to
such of their number or to the Depositor the doing of such things and the
execution of such instruments either in the name of the Trust or the names of
the Administrator or otherwise as the Administrator may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of this Trust Agreement, as set forth herein.
SECTION 8.19. Delaware Trustee.
(a) Notwithstanding any other provision of this Trust Agreement, 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
Administrators or the Property Trustee described in this Trust Agreement. The
Delaware Trustee shall be a trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware Business Trust Act.
(b) It is expressly understood and agreed by the parties hereto that in
fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust
(i) any agreements or instruments executed and delivered by Chase Manhattan Bank
Delaware are executed and delivered not in its individual capacity but solely as
Delaware Trustee under this Trust Agreement in the exercise of the powers and
authority conferred and vested in it, (ii) each of the representations,
undertakings and agreements herein made on the part of the Trust is made and
intended not as representations, warranties, covenants, undertakings and
agreements by Chase Manhattan Bank Delaware in its individual capacity but is
made and intended for the purpose of binding only the Trust, and (iii) under no
circumstances shall Chase Manhattan Bank Delaware in its individual capacity be
personally liable for the payment of any indebtedness or expenses of the Trust
or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by the Trust under this Trust Agreement,
except if such breach or failure is due to any gross negligence or willful
misconduct of the Delaware Trustee.
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. Dissolution Upon Expiration Date.
Unless earlier dissolved, the Trust shall automatically dissolve on
_________, 20__ (the "Expiration Date"). Thereafter, the Trust Property shall be
distributed in accordance with Section 9.4.
SECTION 9.2. Early Dissolution.
The first to occur of any of the following events is an "Early Termination
Event," the occurrence of which shall cause a dissolution of the Trust:
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(a) the occurrence of a Bankruptcy Event in respect of, or the dissolution
or liquidation of, the Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Depositor at any
time to dissolve the Trust and, after satisfaction of liabilities to creditors
of the Trust as provided by applicable law, distribute Debentures to
Securityholders in exchange for the Preferred Securities;
(c) the redemption of all of the Preferred Securities in connection with
the redemption of all the Debentures; and
(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction.
SECTION 9.3. Dissolution.
The respective obligations and responsibilities of the Trustees and the
Trust created and continued hereby shall terminate upon the latest to occur of
the following: (a) the distribution by the Property Trustee to Securityholders
upon the liquidation of the Trust pursuant to Section 9.4, or upon the
redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Administrators, including the
performance of any tax reporting obligations with respect to the Trust or the
Securityholders.
SECTION 9.4. Liquidation.
(a) If an Early Termination Event specified in clause (a), (b) or (d) of
Section 9.2 occurs or upon the Expiration Date, the Trust shall be liquidated by
the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to each Securityholder a Like Amount of Debentures,
subject to Section 9.4(d). Notice of liquidation shall be given by the Property
Trustee by first-class mail, postage prepaid mailed not later than 15 nor more
than 60 days prior to the Liquidation Date to each Holder of Trust Securities at
such Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iii) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for
Debentures, or if Section 9.4(d)
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applies receive a Liquidation Distribution, as the Administrators or
the Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect the
liquidation of the Trust and distribution of the Debentures to Securityholders,
the Property Trustee shall establish a record date for such distribution (which
shall be not more than 45 days nor less than 15 days prior to the Liquidation
Date) and, either itself acting as exchange agent or through the appointment of
a separate exchange agent, shall establish such procedures as it shall deem
appropriate to effect the distribution of Debentures in exchange for the
Outstanding Trust Securities Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Debentures will be issued to Holders
of Trust Securities Certificates, upon surrender of such certificates to the
exchange agent for exchange, (iii) the Depositor shall use its reasonable
efforts to have the Debentures designated on or with any exchange, interdealer
quotation system or self-regulatory organization as the Preferred Securities are
then listed, (iv) any Trust Securities Certificates not so surrendered for
exchange will be deemed to represent a Like Amount of Debentures, accruing
interest at the rate provided for in the Debentures from the last Distribution
Date on which a Distribution was made on such Trust Securities Certificates
until such certificates are so surrendered (and until such certificates are so
surrendered, no payments of interest or principal will be made to Holders of
Trust Securities Certificates with respect to such Debentures) and (v) all
rights of Securityholders holding Trust Securities will cease, except the right
of such Securityholders to receive Debentures upon surrender of Trust Securities
Certificates.
(d) In the event that, notwithstanding the other provisions of this Section
9.4, whether because of an order for dissolution entered by a court of competent
jurisdiction or otherwise, distribution of the Debentures in the manner provided
herein is determined by the Property Trustee not to be practical, the Trust
Property shall be liquidated, and the Trust shall be wound-up, by the Property
Trustee in such manner as the Property Trustee determines. In such event,
Securityholders will be entitled to receive out of the assets of the Trust
available for distribution to Securityholders, after satisfaction of liabilities
to creditors of the Trust as provided by applicable law, an amount equal to the
Liquidation Amount per Trust Security plus accumulated and unpaid Distributions
thereon to the date of payment (such amount being the "Liquidation
Distribution"). If, upon any such winding-up the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities
shall be paid on a pro rata basis (based upon Liquidation Amounts). The Holder
of the Common Securities will be entitled to receive Liquidation Distributions
upon any such winding-up pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Debenture Event of Default has occurred
and is continuing, the Preferred Securities shall have a priority over the
Common Securities.
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SECTION 9.5. Mergers, Consolidations, Conversions, Amalgamations or
Replacements of the Trust.
The Trust may not merge with or into, consolidate, convert into,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, except pursuant to this
Article IX. At the request of the Holder of a majority of the Common Securities,
without the consent of the Holders of the Preferred Securities, the Property
Trustee or the Delaware Trustee, the Trust may merge with or into, consolidate,
convert into, amalgamate, or be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as such
under the laws of any state; provided, that (i) such successor entity either (a)
expressly assumes all of the obligations of the Trust with respect to the
Preferred Securities or (b) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Preferred Securities rank in priority with respect to distributions and payments
upon liquidation, redemption and otherwise, (ii) the Depositor expressly
appoints a trustee of such successor entity possessing the same powers and
duties as the Property Trustee as the holder of the Debentures, (iii) such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not cause the Preferred Securities (including any Successor Securities) to
be downgraded by any nationally recognized statistical rating organization, (iv)
such merger, consolidation, conversion, amalgamation, replacement, conveyance,
transfer or lease does not adversely affect the rights, preferences and
privileges of the Holders of the Preferred Securities (including any Successor
Securities) in any material respect, (v) such successor entity has a purpose
substantially identical to that of the Trust, (vi) prior to such merger,
consolidation, conversion, amalgamation, replacement, conveyance, transfer or
lease, the Depositor has received an Opinion of Counsel from independent counsel
to the Trust experienced in such matters to the effect that (a) such merger,
consolidation, conversion, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
Holders of the Preferred Securities (including any Successor Securities) in any
material respect, and (b) following such merger, consolidation, conversion,
amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor
such successor entity will be required to register as an investment company
under the 1940 Act and (vii) the Depositor 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.
Notwithstanding the foregoing, the Trust shall not, except with the consent of
Holders of 100% in Liquidation Amount of the Preferred Securities, consolidate,
convert into, amalgamate, merge with or into, or be replaced by or convey,
transfer or lease its properties and assets 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, conversion, amalgamation, merger,
replacement, conveyance, transfer or lease would (i) cause the Trust or the
successor entity to be classified as other than a grantor trust or (ii) result
in the recognition of taxable gain or loss by such holder, for United States
federal income tax purposes.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Securityholders to Terminate Trust.
Except to the extent set forth in Section 9.2, the death, incapacity,
dissolution, liquidation, termination or bankruptcy of any Person having an
interest, beneficial or otherwise, in Trust Securities shall not operate to
terminate this Trust Agreement, nor dissolve, terminate or annul the Trust, nor
entitle the legal representatives, successors or heirs of such Person or any
Securityholder for such Person, to claim an accounting, take any action or bring
any proceeding in any court for a partition or winding up of the arrangements
contemplated hereby, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
SECTION 10.2. Amendment.
(a) This Trust Agreement may be amended from time to time by the Trustees,
and the Holders of a majority of the Common Securities, without the consent of
any Holders of the Preferred Securities, (i) to cure any ambiguity, correct or
supplement any provision herein which may be inconsistent with any other
provision herein, or to make any other provisions with respect to matters or
questions arising under this Trust Agreement, which shall not be inconsistent
with the other provisions of this Trust Agreement, or (ii) to modify, eliminate
or add to any provisions of this Trust Agreement to such extent as shall be
reasonably 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 1940 Act; provided,
however, that in the case of clause (i), such action shall not adversely affect
in any material respect the interests of any Securityholder, and any such
amendments of this Trust Agreement shall become effective when notice thereof is
given to the Securityholders.
(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Holders of a majority of
the Common Securities with (i) the consent of Securityholders representing not
less than a majority (based upon Liquidation Amounts) of the Trust Securities
then Outstanding and (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 of an investment company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement 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
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Securities as of a specified date or (ii) restrict the right of a Securityholder
to institute suit for the enforcement of any such payment on or after such date;
notwithstanding any other provision herein, without the unanimous consent of the
Securityholders (such consent being obtained in accordance with Section 6.3 or
6.6 hereof), this paragraph (c) of this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an investment company under the 1940 Act or fail or cease to be
classified as a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made, the
Property Trustees or the Administrators shall promptly provide to the Depositor
a copy of such amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall be required
to enter into any amendment to this Trust Agreement which affects its own
rights, duties or immunities under this Trust Agreement. The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officers' Certificate
stating that any amendment to this Trust Agreement is in compliance with this
Trust Agreement.
SECTION 10.3. Separability.
In case any provision in this Trust Agreement or in the Trust Securities
Certificates shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 10.4. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT
AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF DELAWARE (WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES), PROVIDED THAT THE IMMUNITIES AND STANDARD OF CARE OF THE PROPERTY
TRUSTEE IN CONNECTION WITH THE ADMINISTRATION OF ITS TRUSTS AND DUTIES HEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK.
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SECTION 10.5. Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be a day that
is not a Business Day, then such payment need not be made on such date but may
be made on the next succeeding day that is a Business Day (except as otherwise
provided in Sections 4.1(a) and 4.2(d)), with the same force and effect as
though made on the date fixed for such payment, and no interest shall accrue
thereon for the period after such date.
SECTION 10.6. Successors.
This Trust Agreement shall be binding upon and shall inure to the benefit
of any successor to the Depositor, the Trust or the Relevant Trustee, including
any successor by operation of law. Except in connection with transactions
permitted under Article XI of the Indenture and pursuant to which the assignee
agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
SECTION 10.7. Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
SECTION 10.8. Reports, Notices and Demands.
Any report, notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
any Securityholder or the Depositor may be given or served in writing by deposit
thereof, first-class postage prepaid, in the United States mail, hand delivery
or facsimile transmission, in each case, addressed, (a) in the case of a
Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Depositor, to The Bear Stearns
Companies Inc., 245 Park Avenue, New York, New York 10167, Attention: Corporate
Secretary, Facsimile No.: (212) 272-8904 (until another address is designated by
notice to the Trustees). Such notice, demand or other communication to or upon a
Securityholder shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission. Any notice, demand or
other communication which by any provision of this Trust Agreement is required
or permitted to be given or served to or upon the Trust, the Property Trustee,
the Delaware Trustee or the Administrators shall be given in writing addressed
(until another address is designated by notice to the other parties hereto) as
follows: (a) with respect to the Property Trustee to The Chase Manhattan Bank,
450 West 33rd Street, New York, New York 10001, Attention: Corporate Trustee
Administration Department; (b) with respect to the Delaware Trustee, to Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801,
Attention: Corporate Trustee Administration Department; (c) with respect to the
Administrators, to them at the address above for notices to the Depositor,
marked "Attention: Administrators of Bear Stearns Capital Trust __" and (d) with
respect to the Trust, c/o The Bear Stearns Companies Inc., 245 Park Avenue, New
York, New York, 10167, Attention: Corporate Secretary. Such notice, demand
-55-
<PAGE>
or other communication to or upon the Trust, the Administrators, the Property
Trustee or the Delaware Trustee shall be deemed to have been sufficiently given
or made only upon actual receipt of the writing by the Trust, the
Administrators, the Property Trustee or the Delaware Trustee, as the case may
be.
SECTION 10.9. Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Property Trustee
or the Trust may assert. The provisions of this Section 10.9 shall survive the
termination of this Trust Agreement.
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of 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 any provision hereof limits, qualifies or conflicts with the duties
imposed under Section 310 through 317 of the Trust Indenture Act, such duties
shall control. If any provision of this Trust Agreement modifies or excludes any
provision of the Trust Indenture Act which may be so modified or excluded, the
latter provision shall be deemed to apply to this Trust Agreement as so modified
or excluded, as the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE
OR FURTHER MANIFESTATION
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<PAGE>
OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE SECURITYHOLDER
AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE
TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION
PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE INDENTURE, AND SHALL
CONSTITUTE THE AGREEMENT OF THE TRUST THE TRUSTEES, THE ADMINISTRATORS, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
SECTION 10.12. Counterparts.
This Trust Agreement may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original; but all such counterparts
shall together constitute but one and the same instrument.
-57-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Trust Agreement of Bear Stearns Capital Trust __ as of the date first above
written.
THE BEAR STEARNS COMPANIES INC.,
as Depositor
By:
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Property Trustee
By:
------------------------------------
Name:
Title:
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By:
------------------------------------
Name:
Title:
-----------------------------------------
Kenneth L. Edlow,
as Administrator
-----------------------------------------
Samuel L. Molinaro Jr.,
as Administrator
-----------------------------------------
William J. Montgoris,
as Administrator
<PAGE>
EXHIBIT A
FORM OF CERTIFICATE OF TRUST
CERTIFICATE OF TRUST
OF
BEAR STEARNS CAPITAL TRUST __
THIS Certificate of Trust of Bear Stearns Capital Trust __ (the "Trust"),
dated as of November 4, 1998 is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del.C. Section 3801, et seq.).
1. Name. The name of the business trust formed hereby is Bear Stearns
Capital Trust __.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are Chase
Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first-above written.
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
By:
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Property Trustee
By:
------------------------------------
Name:
Title:
A-1
<PAGE>
EXHIBIT B
FORM OF COMMON SECURITIES CERTIFICATE
Certificate No. __________ No. of Common Securities __________
CERTIFICATE EVIDENCING FIXED/ADJUSTABLE RATE COMMON SECURITIES
OF
BEAR STEARNS CAPITAL TRUST __
(LIQUIDATION AMOUNT $_____ PER COMMON SECURITY)
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS DESCRIBED IN THE TRUST AGREEMENT
(AS DEFINED BELOW).
Bear Stearns Capital Trust __, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that
_________________________________________________________________ (the "Holder")
is the registered owner of
_________________________________________________ (__________) Common Securities
of the Trust representing undivided beneficial interests in the assets of the
Trust and designated the Fixed/Adjustable Rate Common Securities (liquidation
amount $_____ per Common Security) (the "Common Securities"). To the extent set
forth in Section 5.10 of the Trust Agreement, the Common Securities are not
transferable and any attempted transfer hereof shall be void. The designations,
rights, privileges, restrictions, preferences and other terms and provisions of
the Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject to
the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of __________, ____, as the same may be amended from time to time
(the "Trust Agreement"), including the designation of the terms of the Common
Securities as set forth therein. The Trust will furnish a copy of the Trust
Agreement to the Holder without charge upon written request to the Trust at its
principal place of business.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the Administrators of the Trust has executed
this certificate this ___ day of _____________.
By:
------------------------------------
Name:
Title: Administrator
B-1
<PAGE>
EXHIBIT C
FORM OF PREFERRED SECURITIES CERTIFICATE
Certificate No. __________ No. of Preferred Securities __________
CUSIP NO. __________
CERTIFICATE EVIDENCING FIXED/ADJUSTABLE RATE PREFERRED SECURITIES
OF
BEAR STEARNS CAPITAL TRUST __
(LIQUIDATION AMOUNT $_____ PER PREFERRED SECURITY)
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO BEAR STEARNS
CAPITAL TRUST __ OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO A PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]*
[THE PREFERRED SECURITIES WILL BE ISSUED, AND MAY BE TRANSFERRED, ONLY IN BLOCKS
HAVING A LIQUIDATION AMOUNT OF $_____ OR MORE (AT LEAST 100 PREFERRED
SECURITIES). ANY ATTEMPTED TRANSFER, SALE OR OTHER DISPOSITION OF PREFERRED
SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $_____ SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY TRANSFEREE OF SUCH A
BLOCK OF LESS THAN 100 PREFERRED SECURITIES SHALL BE DEEMED NOT TO BE THE HOLDER
OF SUCH PREFERRED SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE
RECEIPT OF DISTRIBUTIONS ON SUCH PREFERRED SECURITIES, AND SUCH TRANSFEREE SHALL
BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH PREFERRED SECURITIES.]**
Bear Stearns Capital Trust __, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that
_________________________________________________________________ (the "Holder")
is the registered owner of [the number of Preferred Securities of the Trust
specified in Schedule A hereto]*
C-1
<PAGE>
[________________________________________________ (__________) Preferred
Securities of the Trust]** representing an undivided beneficial interest in the
assets of the Trust and designated the Fixed/Adjustable Rate Preferred
Securities of Bear Stearns Capital Trust __ liquidation amount $_____ per
Preferred Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer as provided in Section 5.4 of the Trust Agreement (as
defined below). The designations, rights, privileges, restrictions, preferences
and other terms and provisions of the Preferred Securities are set forth in, and
this certificate and the Preferred Securities represented hereby are issued and
shall in all respects be subject to the terms and provisions of, the Amended and
Restated Trust Agreement of the Trust dated as of ____________, ____, as the
same may be amended from time to time (the "Trust Agreement"). The Holder is
entitled to the benefits of the Preferred Securities Guarantee Agreement entered
into by The Bear Stearns Companies Inc., a Delaware corporation, and The Chase
Manhattan Bank as guarantee trustee, dated as of __________, ____, as the same
may be amended from time to time (the "Guarantee Agreement"), to the extent
provided therein. The Trust will furnish a copy of the Trust Agreement and the
Guarantee Agreement to the Holder without charge upon written request to the
Trust at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
IN WITNESS WHEREOF, one of the administrators of the Trust has executed
this certificate this _____ day of ______________, ____.
By:
------------------------------------
Name:
Title: Administrator
- ---------------
* Insert in book-entry securities only.
** Insert in definitive securities only.
C-2
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers the
within Preferred Security and all rights thereunder, unto
----------------------------------------
Please insert Social Security
or other identifying number of assignee:
------------------------------------------------------------
(Name and Address of Assignee, including Zip Code,
must be printed or typewritten)
and hereby irrevocably constitutes and appoints
- --------------------------------------------------------------------------------
Attorney to transfer said Preferred Security on the Register of the Preferred
Securities, with full power of substitution in the premises.
Date: -----------------------------------------
Signature(s)
Signature(s) must be guaranteed by a
commercial bank or trust company or a
member firm of a major stock exchange.
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Preferred Security in every
particular, without alteration or enlargement or any change whatever.
C-3
<PAGE>
SCHEDULE A
CHANGES TO NUMBER OF PREFERRED SECURITIES
IN BOOK-ENTRY SECURITY
The initial number of Preferred Securities evidenced by this Book-Entry
Preferred Securities Certificate is ___________.
Number of Preferred Securities
by which this Book-entry Remaining Amount
Security is to be Reduced of this Notation
Date and Reason for Reduction Book-entry Security Made by
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C-4
================================================================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
BEAR STEARNS CAPITAL TRUST __
Dated as of __________, ____
================================================================================
<PAGE>
CROSS-REFERENCE TABLE
Preferred
Trust Indenture Securities
Act Section Guarantee Section
- --------------- -----------------
310 (a)...................................................... 4.1(a)
(b)...................................................... 4.1(c)
(c)...................................................... Not Applicable
311 (a)...................................................... 2.2(a)
(b)...................................................... 2.2(b)
(c)...................................................... Not Applicable
312 (a)...................................................... 2.2(a)
(b)...................................................... 2.2(b)
313 ......................................................... 2.3
314 (a)...................................................... 2.4
(b)...................................................... Not Applicable
(c)...................................................... 2.5
(d)...................................................... Not Applicable
(f)...................................................... Not Applicable
315 (a)...................................................... 3.1(b)
(b)...................................................... 2.7
(c)...................................................... 3.1(a)
(d)...................................................... 3.1(a)
316 (a)...................................................... 5.4(a), 2.6
- ---------------
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of this Preferred Securities Guarantee.
<PAGE>
TABLE OF CONTENTS
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 Securities....................................5
SECTION 2.3 Reports by the Guarantee Trustee..................................5
SECTION 2.4 Periodic Reports to Guarantee Trustee.............................5
SECTION 2.5 Evidence of Compliance with Conditions Precedent..................6
SECTION 2.6 Events of Default; Waiver.........................................6
SECTION 2.7 Events of Default; Notice.........................................6
SECTION 2.8 Conflicting Interests.............................................6
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee........................7
SECTION 3.2 Certain Rights of Guarantee Trustee...............................8
SECTION 3.3 Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee........................................10
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility...................................10
SECTION 4.2 Appointment, Removal and Resignation of Guarantee
Trustee.....................................................11
ARTICLE V
GUARANTEE
SECTION 5.1 Preferred Securities Guarantee...................................12
SECTION 5.2 Waiver of Notice and Demand......................................12
SECTION 5.3 Obligations Not Affected.........................................12
SECTION 5.4 Rights of Holders................................................13
SECTION 5.5 Guarantee of Payment.............................................14
SECTION 5.6 Subrogation......................................................14
<PAGE>
SECTION 5.7 Independent Obligations..........................................14
SECTION 5.8 Consolidation, Merger, Sale of Assets and Other
Transactions................................................14
ARTICLE VI
SUBORDINATION
SECTION 6.1 Ranking..........................................................15
ARTICLE VII
TERMINATION
SECTION 7.1 Termination......................................................15
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation......................................................16
SECTION 8.2 Indemnification..................................................16
SECTION 8.3 Compensation; Reimbursement of Expenses..........................16
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns...........................................17
SECTION 9.2 Amendments.......................................................17
SECTION 9.3 Notices..........................................................17
SECTION 9.4 Benefit..........................................................18
SECTION 9.5 Governing Law....................................................18
-ii-
<PAGE>
PREFERRED SECURITIES GUARANTEE AGREEMENT
PREFERRED SECURITIES GUARANTEE AGREEMENT, dated as of __________, ____,
(the "Preferred Securities Guarantee") is executed and delivered by The Bear
Stearns Companies Inc., a Delaware corporation (the "Guarantor"), and The Chase
Manhattan Bank, a New York State banking corporation, as trustee (the "Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Preferred Securities (as defined herein) of Bear Stearns Capital Trust
__, a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as of
__________, ____, (the "Trust Agreement") among the trustees named therein of
the Issuer, the administrators named therein, The Bear Stearns Companies Inc.,
as depositor, 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
securities, having an aggregate Liquidation Amount of up to $__________,
designated the Fixed/Adjustable Rate Preferred Securities (the "Preferred
Securities");
WHEREAS, as incentive for the Holders to purchase the Preferred Securities,
the Guarantor desires irrevocably and unconditionally to agree, to the extent
set forth in this Preferred Securities Guarantee, to pay to the Holders of
Preferred Securities 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 also executing and delivering a common securities
guarantee agreement (the "Common Securities Guarantee") in similar terms to this
Preferred Securities Guarantee for the benefit of the holders of the Common
Securities (as defined in the Trust Agreement) of the Issuer, except that if an
Event of Default (as defined in the Trust Agreement), 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 rights of
Holders of Preferred Securities to receive Guarantee Payments under this
Preferred Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Preferred Securities
Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.
In this Preferred Securities Guarantee, unless the context otherwise
requires:
<PAGE>
(a) capitalized terms used in this 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 anywhere in this Preferred Securities Guarantee has the
same meaning throughout;
(c) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities Guarantee as
modified, supplemented or amended from time to time;
(d) all references in this Preferred Securities Guarantee to Articles and
Sections are to Articles and Sections of this Preferred Securities Guarantee,
unless otherwise specified;
(e) terms defined in the Trust Agreement as at the date of execution of
this Preferred Securities Guarantee or in the Trust Indenture Act as the case
may be, have the same meanings when used in this Preferred Securities Guarantee,
unless otherwise defined in this Preferred Securities Guarantee or unless the
context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa.
"Corporate Trust Office" means the office of the Guarantee Trustee at which
the corporate trust business of the Guarantee Trustee shall, at any particular
time, be principally administered, which office at the date of execution of this
Preferred Securities Guarantee is located at 450 West 33rd Street, New York, New
York 10001.
"Covered Person" means any Holder or beneficial owner of Preferred
Securities.
"Debentures" means the junior subordinated debentures of The Bear Stearns
Companies Inc. designated the Fixed/Adjustable Rate Junior Subordinated
Deferrable Interest Debentures due __________, 20__ held by the Property Trustee
(as defined in the Trust Agreement) of the Issuer.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Preferred Securities Guarantee.
"Existing Indenture" means the Indenture, dated as of January 29, 1997,
between the Guarantor and The Chase Manhattan Bank, as trustee, as amended or
supplemented from time to time.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by the Issuer: (i) any accumulated and unpaid Distributions (as defined in
the Trust Agreement) which are required to be paid on such Preferred Securities
to the extent the Issuer shall have
-2-
<PAGE>
funds available therefor, (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 available therefor, with respect to any
Preferred Securities called for redemption by the Issuer, and (iii) upon a
voluntary or involuntary dissolution, winding-up or termination of the Issuer
(other than in connection with the distribution of Debentures to the Holders in
exchange for Preferred Securities as provided in the Trust Agreement), the
lesser of (a) the aggregate of the Liquidation Amount and all accumulated and
unpaid Distributions on the Preferred Securities to the date of payment, to the
extent the Issuer shall have funds 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").
"Guarantees" means the Common Securities Guarantee and this Preferred
Securities Guarantee, collectively.
"Guarantee Trustee" means The Chase Manhattan Bank, a New York State
banking corporation, until a Successor Guarantee Trustee has been appointed and
has accepted such appointment pursuant to the terms of this Preferred Securities
Guarantee and thereafter means each such Successor Guarantee Trustee.
"Holder" shall mean any holder, as registered on the books and records of
the Issuer, of any Preferred Securities; provided, however, that, in determining
whether the holders of the requisite percentage of 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 Guarantee Trustee, any Affiliate of the
Guarantee Trustee, or any officers, directors, shareholders, members, partners,
employees, representatives, nominees, custodians or agents of the Guarantee
Trustee.
"Indenture" means the Indenture dated as of ________ __, ____, between the
Guarantor and The Chase Manhattan Bank, not in its individual capacity but
solely as trustee, and any indenture supplemental thereto pursuant to which the
Debentures are to be issued to the Property Trustee of the Issuer.
"Liquidation Distribution" has the meaning set forth in the definition of
"Guarantee Payments" herein.
"Majority in Liquidation Amount of the Preferred Securities" means, except
as provided by the Trust Indenture Act, a vote by Holder(s) of Preferred
Securities, voting together as a class, but separately from the holders of
Common Securities, of more than 50% of the aggregate Liquidation Amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which the
voting percentages are determined) of all Preferred Securities then outstanding.
"Officers' Certificate" means a certificate signed by the Chairman of the
Board or any Vice Chairman of the Board or the President or any Executive Vice
President or Chief
-3-
<PAGE>
Operating Officer or Chief Financial Officer of the Depositor and by the
Treasurer or an Assistant Treasurer or Controller or the Secretary or an
Assistant Secretary of the Depositor and delivered to the Guarantee Trustee. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Preferred Securities Guarantee (other than
pursuant to Section 2.4) 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 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.
"Other Guarantees" means all other guarantees (if any) to be issued by the
Company with respect to capital securities (if any) to be issued by other trusts
to be established by the Company (if any).
"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 Guarantee Trustee, any
officer within the Corporate Trust Office of the Guarantee Trustee, including
any vice president, any assistant vice president, any assistant secretary, the
treasurer, any assistant treasurer, any trust officer, any senior trust officer,
or other officer of the Corporate Trust Office of the Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers 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 Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Event of Default" means an "Event of Default" as defined in the
Trust Agreement.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
"Trust Securities" means the Common Securities and the Preferred
Securities.
-4-
<PAGE>
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Preferred Securities Guarantee is subject to the provisions of the
Trust Indenture Act and shall, to the extent applicable, be governed by such
provisions; and
(b) if and to the extent that any provision of this Preferred Securities
Guarantee limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
SECTION 2.2 Lists of Holders of Securities.
(a) The Guarantor shall provide the Guarantee Trustee (i) within five days
after each record date for payment of Distributions, a list, in such form as the
Guarantee Trustee may reasonably require, of the names and addresses of the
Holders of the Preferred Securities ("List of Holders") as of such record date,
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 Guarantee Trustee by the Guarantor, and (ii) at any
other time within 30 days of receipt by the Guarantor of a written request for a
List of Holders, which List of Holders shall be as of a date no more than 14
days before such List of Holders is given to the Guarantee Trustee. The
Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
(b) The 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 Guarantee Trustee.
Not later than January 15 of each year commencing January 15, ____, the
Guarantee Trustee shall provide to the Holders of the Preferred Securities such
reports dated as of the immediately preceding November 15 as are required by
Section 313(a) of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall
also comply with the requirements of Section 313(d) of the Trust Indenture Act.
The Guarantor will notify the Guarantee Trustee if and when any Preferred
Securities are listed on any exchange, interdealer quotation system or
self-regulatory organization.
SECTION 2.4 Periodic Reports to Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the Securities and
Exchange Commission and the Holders as applicable, such documents, reports and
information (if any) as required by Section 314 and the compliance certificate
required by Section 314(a)(4) of the Trust Indenture Act in the form, in the
manner and at the times required by Section 314
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of the Trust Indenture Act, such compliance certificate to be delivered annually
on or before September 15 of each year beginning in ____.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with any conditions precedent provided for in this 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) of the Trust Indenture Act may
be given in the form of an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
The Holders of a Majority in Liquidation Amount of the Preferred Securities
may, voting or consenting as a class, on behalf of the Holders of all of the
Preferred Securities, waive any past Event of Default and its consequences. Upon
such waiver, any such Event of Default shall cease to exist, and shall be deemed
to have been cured, for every purpose of this Preferred Securities Guarantee,
but no such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent therefrom.
SECTION 2.7 Events of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the occurrence of an
Event of Default, transmit by mail, first class postage prepaid, to the Holders
of the Preferred Securities, notices of all Events of Default actually known to
a Responsible Officer of the Guarantee Trustee, unless such defaults have been
cured before the giving of such notice; provided, however, that, except in the
case of a default in the payment of a Guarantee Payment, the 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
responsible officers of the Guarantee Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the Preferred
Securities.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Event of Default unless the Guarantee Trustee shall have received written notice
thereof from the Guarantor or a Holder, or a Responsible Officer of the
Guarantee Trustee charged with the administration of this Preferred Securities
Guarantee shall have obtained written notice thereof.
SECTION 2.8 Conflicting Interests.
The Indenture and the securities issued or to be issued thereunder; the
Trust Agreement and the Trust Securities issued or to be issued thereunder; any
Preferred Securities Guarantee Agreement relating to a Bear Stearns Trust (as
defined in the Indenture and the Existing Indenture) between the Guarantor and
The Chase Manhattan Bank, as guarantee trustee; any Amended and Restated Trust
Agreement relating to a Bear Stearns Trust among the Guarantor, as depositor,
The Chase Manhattan Bank, as property trustee, Chase Manhattan Bank Delaware, as
Delaware trustee, the administrators named therein and the several holders
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and the Trust Securities issued and to be issued thereunder; and the Existing
Indenture and the securities issued or to be issued thereunder, shall be deemed
to be specifically described in this Preferred Securities Guarantee for the
purposes of clause (i) of the proviso contained in Section 310(b)(l) of the
Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Guarantee Trustee.
(a) This Preferred Securities Guarantee shall be held by the Guarantee
Trustee for the benefit of the Holders of the Preferred Securities, and the
Guarantee Trustee shall not transfer this Preferred Securities Guarantee to any
Person except a Holder of Preferred Securities exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Guarantee Trustee on acceptance by
such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee. The right, title and interest of the Guarantee Trustee shall
automatically vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible Officer of the
Guarantee Trustee has occurred and is continuing, the Guarantee Trustee shall
enforce this Preferred Securities Guarantee for the benefit of the Holders of
the Preferred Securities.
(c) The Guarantee Trustee, before the occurrence of any Event of Default
and after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Preferred Securities Guarantee, and no implied covenants shall be read into this
Preferred Securities Guarantee against the Guarantee Trustee. In case an Event
of Default has occurred (that has not been cured or waived pursuant to Section
2.6) and is actually known to a Responsible Officer of the Guarantee Trustee,
the Guarantee Trustee shall exercise such of the rights and powers vested in it
by this 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 Preferred Securities Guarantee shall be construed
to relieve the Guarantee Trustee from liability for its own negligent action,
its own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Guarantee Trustee shall be
determined solely by the express provisions of this Preferred
Securities
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Guarantee, and the Guarantee Trustee shall not be liable except for
the performance of such duties and obligations as are specifically set
forth in this Preferred Securities Guarantee, and no implied covenants
or obligations shall be read into this Preferred Securities Guarantee
against the Guarantee Trustee; and
(B) in the absence of bad faith on the part of the Guarantee
Trustee, the 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 Guarantee
Trustee and conforming to the requirements of this 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 Guarantee Trustee, the Guarantee Trustee shall be
under a duty to examine the same to determine whether or not they
conform to the requirements of this Preferred Securities Guarantee;
(ii) the Guarantee Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Guarantee
Trustee, unless it shall be proved that such Responsible Officer of the
Guarantee Trustee or the Guarantee Trustee was negligent in ascertaining
the pertinent facts upon which such judgment was made;
(iii) the 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 not less than a Majority in Liquidation
Amount of the Preferred Securities relating to the time, method and place
of conducting any proceeding for any remedy available to the Guarantee
Trustee, or exercising any trust or power conferred upon the Guarantee
Trustee under this Preferred Securities Guarantee; and
(iv) no provision of this Preferred Securities Guarantee shall require
the 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 Guarantee Trustee shall
have reasonable grounds for believing that the repayment of such funds is
not reasonably assured to it under the terms of this Preferred Securities
Guarantee or indemnity, reasonably satisfactory to the Guarantee Trustee,
against such risk or liability is not reasonably assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The 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.
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(ii) Any direction or act of the Guarantor contemplated by this
Preferred Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate.
(iii) Whenever, in the administration of this Preferred Securities
Guarantee, the Guarantee Trustee shall deem it desirable that a matter be
proved or established before taking, suffering or omitting any action
hereunder, the 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 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 Guarantee Trustee may consult with counsel of its selection,
and the written 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 Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee from any court
of competent jurisdiction.
(vi) The Guarantee Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Preferred Securities
Guarantee at the request or direction of any Holder, unless such Holder
shall have provided to the Guarantee Trustee such security and indemnity,
reasonably satisfactory to the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses and the expenses of the
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 Guarantee
Trustee; provided, however, that nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Guarantee Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the rights
and powers vested in it by this Preferred Securities Guarantee.
(vii) The 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 Guarantee Trustee, in its
discretion, may make such further inquiry or investigation into such facts
or matters as it may see fit.
(viii) The Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents,
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nominees, custodians or attorneys, and the Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder.
(ix) Whenever in the administration of this Preferred Securities
Guarantee the Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right or taking any
other action hereunder, the Guarantee Trustee (A) may request instructions
from the Holders of a Majority in Liquidation Amount of the Preferred
Securities, (B) may refrain from enforcing such remedy or right or taking
such other action until such instructions are received, and (C) shall be
protected in conclusively relying on or acting in accordance with such
instructions.
(x) The Guarantee Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Preferred Securities Guarantee.
(b) No provision of this Preferred Securities Guarantee shall be deemed to
impose any duty or obligation on the Guarantee 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 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 Guarantee Trustee
shall be construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of Preferred
Securities Guarantee.
The recitals contained in this Preferred Securities Guarantee shall be
taken as the statements of the Guarantor, and the Guarantee Trustee does not
assume any responsibility for their correctness. The Guarantee Trustee makes no
representation as to the validity or sufficiency of this Preferred Securities
Guarantee.
ARTICLE IV
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility.
(a) There shall at all times be a 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
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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 fifty 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 Guarantee Trustee shall cease to be eligible to so
act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act, subject to the penultimate
paragraph thereof.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor except during an Event of
Default.
(b) The Guarantee Trustee shall not be removed in accordance with Section
4.2(a) until a Successor Guarantee Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor Guarantee
Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed to office shall hold office until a
Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by an instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor 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 Guarantee Trustee
resigning or being removed may petition any court of competent jurisdiction for
appointment of a Successor Guarantee Trustee. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, appoint a Successor
Guarantee Trustee.
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(e) No Guarantee Trustee shall be liable for the acts or omissions to act
of any Successor Guarantee Trustee.
(f) Upon termination of this Preferred Securities Guarantee or removal or
resignation of the Guarantee Trustee pursuant to this Section 4.2, the Guarantor
shall pay to the Guarantee Trustee all amounts owing to the Guarantee Trustee
under Sections 8.2 and 8.3 accrued to the date of such termination, removal or
resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Preferred Securities 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. Such obligations will not be
discharged except by payment of the Guarantee Payments in full. 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 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 Guarantee Trustee, 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 Preferred Securities Guarantee shall in no way be affected or impaired by
reason of the happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the 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 or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the 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
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period on the Debentures or any extension of the maturity date of the Debentures
permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the 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 Preferred
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(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 hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, the Guarantor with respect to the happening of any of the foregoing.
SECTION 5.4 Rights of Holders.
(a) The Holders of a Majority in Liquidation Amount of the Preferred
Securities have the right to direct the time, method and place of conducting of
any proceeding for any remedy available to the Guarantee Trustee in respect of
this Preferred Securities Guarantee or exercising any trust or power conferred
upon the Guarantee Trustee under this Preferred Securities Guarantee; provided
however, that (subject to Section 3.1) the Guarantee Trustee shall have the
right to decline to follow any such direction if the Guarantee Trustee shall
determine that the actions so directed would be unjustly prejudicial to the
Holders not taking part in such direction or if the Guarantee Trustee being
advised by counsel determines that the action or proceedings directed may not
lawfully be taken or if the Guarantor Trustee in good faith by its board of
directors or trustees, executive committees or a trust committee of directors or
trustees and/or Responsible Officers shall determine that the action or
proceedings so directed would involve the Guarantee Trustee in personal
liability.
(b) Any Holder of Preferred Securities may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Preferred
Securities Guarantee, without first instituting a legal proceeding against the
Issuer, the Guarantee Trustee or any other Person. The Guarantor waives any
right or remedy to require that any such action be
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brought first against the Issuer or any other Person before so proceeding
directly against the Guarantor.
(c) The Guarantor expressly acknowledges that (i) this Preferred Securities
Guarantee will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders and (ii) the Guarantee Trustee has the right to enforce
this Preferred Securities Guarantee on behalf of the Holders.
SECTION 5.5 Guarantee of Payment.
This Preferred Securities Guarantee creates a guarantee of payment and not
of collection. This Preferred Securities Guarantee will not be discharged except
by payment of the Guarantee Payments in full (without duplication of amounts
theretofore paid by the Issuer) or upon distribution of Debentures to Holders as
provided in the Trust Agreement.
SECTION 5.6 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders of
Preferred Securities against the Issuer in respect of any amounts paid to such
Holders by the Guarantor under this 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 Preferred Securities
Guarantee, if, at the time of any such payment, any amounts are due and unpaid
under this 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 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 Preferred Securities Guarantee
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
SECTION 5.8 Consolidation, Merger, Sale of Assets and Other Transactions.
The Guarantor shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and no Person shall consolidate with or merge into the Guarantor
or convey, transfer or lease its properties and assets substantially as an
entirety to the Guarantor, unless (i) either the Guarantor shall be the
continuing corporation, or the successor shall be a Person organized under the
laws of the United States or any state or the District of Columbia, and such
successor Person expressly assumes the Guarantor's obligations under this
Preferred Securities Guarantee by written instrument in form satisfactory to the
Guarantee Trustee, (ii) immediately after
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giving effect thereto, no Event of Default under this Preferred Securities
Guarantee, and no event which, after notice or lapse of time or both, would
become an Event of Default under this Preferred Securities Guarantee, shall have
occurred and be continuing, and (iii) such consolidation, merger, conveyance,
transfer or lease shall be permitted under the Trust Agreement and the Indenture
and does not give rise to any breach or violation of the Trust Agreement or
Indenture.
ARTICLE VI
SUBORDINATION
SECTION 6.1 Ranking.
This Preferred Securities Guarantee will constitute an unsecured obligation
of the Guarantor and will rank subordinate and junior in right of payment to all
present and future Senior Indebtedness of the Company (as defined in the
Indenture). This Preferred Securities Guarantee will rank pari passu with all
Other Guarantees. By their acceptance thereof, each Holder of Preferred
Securities agrees to the foregoing provisions of this Preferred Securities
Guarantee and the other terms set forth herein.
If a Trust Event of Default has occurred and is continuing, the rights of
holders of the Common Securities of the Issuer to receive payments under the
Common Securities Guarantee are subordinated to the rights of Holders of
Preferred Securities to receive Guarantee Payments.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination.
This Preferred Securities Guarantee shall terminate, subject to Sections
8.2 and 8.3, (i) upon full payment of the Redemption Price of all Preferred
Securities, (ii) upon the distribution of the Debentures to the Holders of all
of the Preferred Securities or (iii) upon full payment of the amounts payable in
accordance with the Trust Agreement upon dissolution of the Issuer.
Notwithstanding the foregoing, this Preferred Securities Guarantee will continue
to be effective or will be reinstated, as the case may be, if at any time any
Holder of Preferred Securities must restore payment of any sums paid under the
Preferred Securities or under this Preferred Securities Guarantee.
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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 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
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 Issuer or the Guarantor and upon such information,
opinions, reports or statements presented to the Trust or the Guarantor by any
Persons to matters the Indemnified Person reasonably believes are within such
other Person's professional or expert competence and who, if selected by such
Indemnified Person, has been selected with reasonable care by such Indemnified
Person, 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 of Preferred Securities 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 Guarantee
Trustee will not claim or exact any lien or charge on any Guarantee Payments as
a result of any amount due to it under this Preferred Securities Guarantee. The
obligation to indemnify as set forth in this Section 8.2 shall survive the
termination of this Preferred Securities Guarantee.
SECTION 8.3 Compensation; Reimbursement of Expenses.
The Guarantor agrees:
(a) to pay to the Guarantee Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust); and
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(b) except as otherwise expressly provided herein, to reimburse the
Guarantee Trustee upon request for all reasonable expenses, disbursements and
advances incurred or made by it in accordance with any provision of this
Preferred Securities Guarantee (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad faith.
The provisions of this Section 8.3 shall survive the termination of this
Preferred Securities Guarantee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Preferred Securities then outstanding. Except in connection with any
merger or consolidation of the Guarantor with or into another entity or any sale
or conveyance of the Guarantor's assets to another entity or of another entity's
assets to the Guarantor, in each case, to the extent permitted under Section 5.8
of this Preferred Securities Guarantee, the Guarantor may not assign its rights
or delegate its obligations under this Preferred Securities Guarantee without
the prior approval of the Holders of at least a Majority in Liquidation Amount
of the Preferred Securities.
SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely affect the rights
of Holders of Preferred Securities in any material respect (in which case no
consent of Holders will be required), this Preferred Securities Guarantee may
only be amended with the prior approval of the Holders of a least a Majority in
Liquidation Amount of the Preferred Securities.
The provisions of the Trust Agreement with respect to amendments thereof
apply to the giving of such approval.
SECTION 9.3 Notices.
All notices provided for in this 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:
-17-
<PAGE>
(a) If given to the Guarantee Trustee, at the Guarantee Trustee's mailing
address set forth below (or such other address as the Guarantee Trustee may give
notice of to the Holders of the Preferred Securities):
The Chase Manhattan Bank
450 West 33rd Street
New York, NY 10001
Attention: Corporate Trustee Administration Department
(b) 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
of the Preferred Securities and to the Guarantee Trustee):
The Bear Stearns Companies Inc.
245 Park Avenue
New York, NY 10167
Attention: Corporate Secretary
(c) If given to any Holder of Preferred Securities, 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 Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.
SECTION 9.5 Governing Law.
THIS 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 CONFLICT OF LAWS PRINCIPLES THEREOF.
-18-
<PAGE>
This Preferred Securities Guarantee is executed as of the day and year
first above written.
THE BEAR STEARNS COMPANIES INC.,
as Guarantor
By:
------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Guarantee Trustee
By:
------------------------------------
Name:
Title:
[Letterhead of Cadwalader, Wickersham & Taft]
November 5, 1998
The Bear Stearns Companies Inc.
245 Park Avenue
New York, NY 10167
Ladies and Gentlemen:
We have acted as special counsel for The Bear Stearns Companies Inc., a
Delaware corporation (the "Company"), in connection with the preparation of the
Company's Registration Statement on Form S-3 (the "Registration Statement")
pursuant to the Securities Act of 1933, as amended (the "Securities Act"), being
filed with the Securities and Exchange Commission (the "Commission") on the date
hereof and to which this opinion letter is an exhibit. The Registration
Statement relates to an indeterminate aggregate principal amount of Junior
Subordinated Deferrable Interest Debentures (the "Debentures") of the Company,
an indeterminate aggregate liquidation amount of Preferred Securities (the
"Preferred Securities") of Bear Stearns Capital Trust II, Bear Stearns Capital
Trust III, Bear Stearns Capital Trust IV and Bear Stearns Capital Trust V, each
a Delaware business trust (collectively, the "Trusts"), the guarantees by the
Company (the "Guarantees") of the Preferred Securities and an indeterminate
number of shares of the Company's Preferred Stock, par value $1.00 per share
(the "Preferred Stock"), as may be issued from time to time, collectively with
an aggregate offering price of $750,000,000. The Debentures and the Preferred
Stock will be, and the Guarantees will relate to Preferred Securities that will
be, issued in one or more series, the terms of which shall be fixed prior to
issuance by the Company and the applicable Trust.
In rendering the opinions expressed below, we have examined and relied
upon, among other things, (a) the Registration Statement, including the
Prospectus constituting a part thereof, (b) the form of indenture (the
"Indenture"), to be entered into between the Company and The Chase Manhattan
Bank, as trustee, and the form of supplemental indenture under which each issue
of Debentures will be made filed as exhibits to the Registration Statement, (c)
the form of Preferred Securities Guarantee Agreement under which the Guarantees
will be made filed as an exhibit to the Registration Statement and (d) originals
or copies, certified or otherwise identified to our satisfaction, of such
certificates, corporate, public or other records, and other documents as we have
deemed appropriate for the purpose of rendering this opinion letter. In
connection with such examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, the
conformity to original documents and instruments of all documents and
instruments submitted to us as copies or specimens, and the authenticity of the
originals of such documents and instruments submitted to us as copies or
specimens. We have also made such investigations of law as we have deemed
appropriate. In addition, we have assumed that the Debentures and the
<PAGE>
The Bear Stearns Companies Inc. -2- November 5, 1998
Guarantees will be executed and delivered in substantially the form in which
they are filed as exhibits to the Registration Statement.
We are members of the Bar of the State of New York, and in rendering the
opinions below, we do not purport to be an expert in, or express any opinion
concerning, the laws of any jurisdiction other than the substantive laws of the
State of New York, the General Corporation Law of the State of Delaware and,
where expressly referred to below, the substantive federal laws of the United
States of America (in each case without regard to conflicts of law principles).
Based upon the foregoing and subject to the qualifications set forth
herein, we are of the opinion that:
1. The Debentures and the Guarantees will be legally and validly issued and
binding obligations of the Company (except to the extent enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer or other similar laws affecting the enforcement of
creditors' rights generally and by the effect of general principles of equity,
regardless of whether enforceability is considered in a proceeding in equity or
at law), when (a) the Registration Statement, as finally amended, shall have
become effective under the Securities Act and the Indenture shall have been
qualified under the Trust Indenture Act of 1939, as amended, and (b) the
Debentures shall have been duly executed, authenticated and delivered, and the
Guarantees shall have been duly executed and delivered, as contemplated in the
Prospectus and applicable Prospectus Supplement.
2. The Company has been duly incorporated and is validly existing as a
corporation under the laws of the State of Delaware.
3. The shares of Preferred Stock will be validly issued, fully paid and
non-assessable when (a) the Registration Statement, as finally amended, shall
have become effective under the Securities Act and (b) the Preferred Stock shall
have been issued, paid for and delivered as contemplated in the Prospectus and
applicable Prospectus Supplement; provided that the issuance of shares of
Preferred Stock is duly authorized by the Company's Board of Directors and that
the number of shares of Preferred Stock issued at no time exceeds the maximum
number of shares of Preferred Stock authorized to be issued by the Company's
Certificate of Incorporation.
<PAGE>
The Bear Stearns Companies Inc. -3- November 5, 1998
We hereby consent to the filing of this opinion letter as an exhibit to the
Registration Statement and to the reference to this Firm in the Prospectus
constituting a part of the Registration Statement under the caption "Legal
Matters," without admitting that we are "experts" within the meaning of the
Securities Act or the rules and regulations of the Commission issued thereunder
with respect to any part of the Registration Statement, including this exhibit.
Very truly yours,
/s/ Cadwalader, Wickersham & Taft
Bear Stearns Capital Trust II
November 4, 1998
Page 1
[Letterhead of Richards, Layton & Finger, P.A.]
November 4, 1998
Bear Stearns Capital Trust II
c/o The Bear Stearns Companies, Inc.
245 Park Avenue
New York, New York 10167
Re: Bear Stearns Capital Trust II
Ladies and Gentlemen:
We have acted as special Delaware counsel for The Bear Stearns Companies
Inc., a Delaware corporation ("Bear Stearns"), and Bear Stearns 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 November 4, 1998 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on November 4, 1998;
(b) The Trust Agreement of the Trust, dated as of November 4, 1998, among
Bear Stearns, the trustees of the Trust named therein and the administrators
named therein;
(c) A form of Amended and Restated Trust Agreement of the Trust (including
Exhibits A, B and C thereto) (the "Trust Agreement"), to be entered into among
Bear Stearns, as depositor, the trustees of the Trust named therein, the
administrators 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);
(d) The Registration Statement on Form S-3 (the "Registration Statement"),
including a prospectus ("Prospectus"), relating to the Preferred Securities of
the Trust representing undivided beneficial interests in the assets of the Trust
(each, a
<PAGE>
Bear Stearns Capital Trust II
November 4, 1998
Page 2
"Preferred Security" and collectively, the "Preferred Securities"), as proposed
to be filed by Bear Stearns, the Trust and others with the Securities and
Exchange Commission on or about November 4, 1998; and
(e) A Certificate of Good Standing for the Trust, dated November 4, 1998,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
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 Trust Agreement
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 Securities Certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Trust Agreement and the Registration Statement, and (vii)
that the Preferred Securities are issued and sold to the Preferred Security
Holders in accordance with the Trust
<PAGE>
Bear Stearns Capital Trust II
November 4, 1998
Page 3
Agreement 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.
To the extent that Section 10.4 of the Trust Agreement provides that the
Trust Agreement is governed by laws other than the laws of the State of
Delaware, we express no opinion concerning Section 10.4 of the Trust Agreement
or the effect of Section 10.4 of the Trust Agreement on the Trust Agreement.
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:
. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
. 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.
. 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 Trust Agreement.
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
<PAGE>
Bear Stearns Capital Trust II
November 4, 1998
Page 4
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/DLD
Bear Stearns Capital Trust III
November 4, 1998
Page 1
[Letterhead of Richards, Layton & Finger, P.A.]
November 4, 1998
Bear Stearns Capital Trust III
c/o The Bear Stearns Companies, Inc.
245 Park Avenue
New York, New York 10167
Re: Bear Stearns Capital Trust III
Ladies and Gentlemen:
We have acted as special Delaware counsel for The Bear Stearns Companies
Inc., a Delaware corporation ("Bear Stearns"), and Bear Stearns Capital Trust
III, 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 November 4, 1998 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on November 4, 1998;
(b) The Trust Agreement of the Trust, dated as of November 4, 1998, among
Bear Stearns, the trustees of the Trust named therein and the administrators
named therein;
(c) A form of Amended and Restated Trust Agreement of the Trust (including
Exhibits A, B and C thereto) (the "Trust Agreement"), to be entered into among
Bear Stearns, as depositor, the trustees of the Trust named therein, the
administrators 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);
(d) The Registration Statement on Form S-3 (the "Registration Statement"),
including a prospectus ("Prospectus"), relating to the Preferred Securities of
the Trust representing undivided beneficial interests in the assets of the Trust
(each, a
<PAGE>
Bear Stearns Capital Trust III
November 4, 1998
Page 2
"Preferred Security" and collectively, the "Preferred Securities"), as proposed
to be filed by Bear Stearns, the Trust and others with the Securities and
Exchange Commission on or about November 4, 1998; and
(e) A Certificate of Good Standing for the Trust, dated November 4, 1998,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
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 Trust Agreement
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 Securities Certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Trust Agreement and the Registration Statement, and (vii)
that the Preferred Securities are issued and sold to the Preferred Security
Holders in accordance with the Trust
<PAGE>
Bear Stearns Capital Trust III
November 4, 1998
Page 3
Agreement 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.
To the extent that Section 10.4 of the Trust Agreement provides that the
Trust Agreement is governed by laws other than the laws of the State of
Delaware, we express no opinion concerning Section 10.4 of the Trust Agreement
or the effect of Section 10.4 of the Trust Agreement on the Trust Agreement.
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:
. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
. 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.
. 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 Trust Agreement.
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
<PAGE>
Bear Stearns Capital Trust III
November 4, 1998
Page 4
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/DLD
Bear Stearns Capital Trust IV
November 4, 1998
Page 1
[Letterhead of Richards, Layton & Finger, P.A.]
November 4, 1998
Bear Stearns Capital Trust IV
c/o The Bear Stearns Companies, Inc.
245 Park Avenue
New York, New York 10167
Re: Bear Stearns Capital Trust IV
Ladies and Gentlemen:
We have acted as special Delaware counsel for The Bear Stearns Companies
Inc., a Delaware corporation ("Bear Stearns"), and Bear Stearns Capital Trust
IV, 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 November 4, 1998 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on November 4, 1998;
(b) The Trust Agreement of the Trust, dated as of November 4, 1998, among
Bear Stearns, the trustees of the Trust named therein and the administrators
named therein;
(c) A form of Amended and Restated Trust Agreement of the Trust (including
Exhibits A, B and C thereto) (the "Trust Agreement"), to be entered into among
Bear Stearns, as depositor, the trustees of the Trust named therein, the
administrators 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);
(d) The Registration Statement on Form S-3 (the "Registration Statement"),
including a prospectus ("Prospectus"), relating to the Preferred Securities of
the Trust representing undivided beneficial interests in the assets of the Trust
(each, a
<PAGE>
Bear Stearns Capital Trust IV
November 4, 1998
Page 2
"Preferred Security" and collectively, the "Preferred Securities"), as proposed
to be filed by Bear Stearns, the Trust and others with the Securities and
Exchange Commission on or about November 4, 1998; and
(e) A Certificate of Good Standing for the Trust, dated November 4, 1998,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
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 Trust Agreement
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 Securities Certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Trust Agreement and the Registration Statement, and (vii)
that the Preferred Securities are issued and sold to the Preferred Security
Holders in accordance with the Trust
<PAGE>
Bear Stearns Capital Trust IV
November 4, 1998
Page 3
Agreement 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.
To the extent that Section 10.4 of the Trust Agreement provides that the
Trust Agreement is governed by laws other than the laws of the State of
Delaware, we express no opinion concerning Section 10.4 of the Trust Agreement
or the effect of Section 10.4 of the Trust Agreement on the Trust Agreement.
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:
. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
. 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.
. 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 Trust Agreement.
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
<PAGE>
Bear Stearns Capital Trust IV
November 4, 1998
Page 4
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/DLD
Bear Stearns Capital Trust V
November 4, 1998
Page 1
[Letterhead of Richards, Layton & Finger, P.A.]
November 4, 1998
Bear Stearns Capital Trust V
c/o The Bear Stearns Companies, Inc.
245 Park Avenue
New York, New York 10167
Re: Bear Stearns Capital Trust V
Ladies and Gentlemen:
We have acted as special Delaware counsel for The Bear Stearns Companies
Inc., a Delaware corporation ("Bear Stearns"), and Bear Stearns Capital Trust V,
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 November 4, 1998 (the
"Certificate"), as filed in the office of the Secretary of State of the State of
Delaware (the "Secretary of State") on November 4, 1998;
(b) The Trust Agreement of the Trust, dated as of November 4, 1998, among
Bear Stearns, the trustees of the Trust named therein and the administrators
named therein;
(c) A form of Amended and Restated Trust Agreement of the Trust (including
Exhibits A, B and C thereto) (the "Trust Agreement"), to be entered into among
Bear Stearns, as depositor, the trustees of the Trust named therein, the
administrators 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);
(d) The Registration Statement on Form S-3 (the "Registration Statement"),
including a prospectus ("Prospectus"), relating to the Preferred Securities of
the Trust representing undivided beneficial interests in the assets of the Trust
(each, a
<PAGE>
Bear Stearns Capital Trust V
November 4, 1998
Page 2
"Preferred Security" and collectively, the "Preferred Securities"), as proposed
to be filed by Bear Stearns, the Trust and others with the Securities and
Exchange Commission on or about November 4, 1998; and
(e) A Certificate of Good Standing for the Trust, dated November 4, 1998,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Trust Agreement.
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 Trust Agreement
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 Securities Certificate for such Preferred
Security and the payment for the Preferred Security acquired by it, in
accordance with the Trust Agreement and the Registration Statement, and (vii)
that the Preferred Securities are issued and sold to the Preferred Security
Holders in accordance with the Trust
<PAGE>
Bear Stearns Capital Trust V
November 4, 1998
Page 3
Agreement 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.
To the extent that Section 10.4 of the Trust Agreement provides that the
Trust Agreement is governed by laws other than the laws of the State of
Delaware, we express no opinion concerning Section 10.4 of the Trust Agreement
or the effect of Section 10.4 of the Trust Agreement on the Trust Agreement.
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:
. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act.
. 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.
. 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 Trust Agreement.
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
<PAGE>
Bear Stearns Capital Trust V
November 4, 1998
Page 4
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/DLD
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement of
The Bear Stearns Companies Inc. on Form S-3 of our reports dated August 21,
1998, appearing in and incorporated by reference in the Annual Report on Form
10-K of The Bear Stearns Companies Inc. for the year ended June 30, 1998, and to
the reference to us under the heading "Experts" in the Prospectus, which is part
of the Registration Statement.
/s/ Deloitte & Touche LLP
November 4, 1998
New York, New York
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
THE BEAR STEARNS COMPANIES INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3286161
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Junior Subordinated Debentures
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years ................................ 253
With a remaining maturity of more than three years ....... 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
BEAR STEARNS 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.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies....................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness and
obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ....... 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
BEAR STEARNS CAPITAL TRUST III
(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.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ............................... 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ........ 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
BEAR STEARNS CAPITAL TRUST IV
(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.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less .............. 3,599
With a remaining maturity of more than one year
through three years ................................... 253
With a remaining maturity of more than three years ......... 132
Bank's liability on acceptances executed and outstanding ........ 1,698
Subordinated notes and debentures ............................... 5,715
Other liabilities ............................................... 9,896
TOTAL LIABILITIES ............................................... 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
BEAR STEARNS CAPITAL TRUST V
(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.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/ William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ........................................ $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ................................ 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................... 43,181
Demand notes issued to the U.S. Treasury ......................... 1,000
Trading liabilities .............................................. 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............... 3,599
With a remaining maturity of more than one year
through three years .................................... 253
With a remaining maturity of more than three years .......... 132
Bank's liability on acceptances executed and outstanding ......... 1,698
Subordinated notes and debentures ................................ 5,715
Other liabilities ................................................ 9,896
TOTAL LIABILITIES ................................................ 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................... 0
Common stock ..................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ......... 10,291
Undivided profits and capital reserves ........................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities ............................ (22)
Cumulative foreign currency translation adjustments .............. 16
TOTAL EQUITY CAPITAL ............................................. 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ............................. $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
THE BEAR STEARNS COMPANIES INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3286161
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities Guarantee
(Bear Stearns Capital Trust II)
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/ William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities .................................... 2,561
Available for sale securities .................................. 43,058
Federal funds sold and securities purchased under
agreements to resell ...................................... 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ........ 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
THE BEAR STEARNS COMPANIES INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3286161
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities Guarantee
(Bear Stearns Capital Trust III)
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/ William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ............................... 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ........ 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus ................... 0
Common stock .................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ........ 10,291
Undivided profits and capital reserves .......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities ........................... (22)
Cumulative foreign currency translation adjustments ............. 16
TOTAL EQUITY CAPITAL ............................................ 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
THE BEAR STEARNS COMPANIES INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3286161
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities Guarantee
(Bear Stearns Capital Trust IV)
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997,
in accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of
the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing ............................$39,487
Interest-bearing ............................... 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's .................................... 71,162
Noninterest-bearing ............................$ 3,205
Interest-bearing ............................... 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ........ 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
------------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
------------------------------
THE BEAR STEARNS COMPANIES INC.
(Exact name of obligor as specified in its charter)
Delaware 13-3286161
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
245 Park Avenue
New York, New York 10167
(Address of principal executive offices) (Zip Code)
------------------------------
Preferred Securities Guarantee
(Bear Stearns Capital Trust V)
(Title of the indenture securities)
----------------------------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which it
is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty Street,
New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of Eligibility.
1. A copy of the Articles of Association of the Trustee as now in effect,
including the Organization Certificate and the Certificates of Amendment dated
February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being contained
in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act (see
Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, 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 3rd day of November, 1998.
THE CHASE MANHATTAN BANK
By /s/William G. Keenan
--------------------------
William G. Keenan
Trust Officer
- 3 -
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1997,
in accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of
the Federal Reserve Act.
Dollar Amounts
ASSETS in Millions
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin .................................... $ 12,428
Interest-bearing balances ................................. 3,428
Securities:
Held to maturity securities ............................... 2,561
Available for sale securities ............................. 43,058
Federal funds sold and securities purchased under
agreements to resell ................................. 29,633
Loans and lease financing receivables:
Loans and leases, net of unearned income .................. $129,260
Less: Allowance for loan and lease losses ................ 2,783
Less: Allocated transfer risk reserve .......... 0
--
Loans and leases, net of unearned income,
allowance, and reserve ............................... 126,477
Trading Assets ................................................. 62,575
Premises and fixed assets (including capitalized
leases) ................................................... 2,943
Other real estate owned ........................................ 295
Investments in unconsolidated subsidiaries and
associated companies ...................................... 231
Customers' liability to this bank on acceptances
outstanding ............................................... 1,698
Intangible assets .............................................. 1,466
Other assets ................................................... 10,268
--------
TOTAL ASSETS ................................................... $297,061
========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................... $94,524
Noninterest-bearing .............................$39,487
Interest-bearing ................................ 55,037
-------
In foreign offices, Edge and Agreement,
subsidiaries and IBF's ............................... 71,162
Noninterest-bearing .............................$ 3,205
Interest-bearing ................................ 67,957
Federal funds purchased and securities sold under
agreements to repurchase .................................. 43,181
Demand notes issued to the U.S. Treasury ....................... 1,000
Trading liabilities ............................................ 48,903
Other borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ............. 3,599
With a remaining maturity of more than one year
through three years .................................. 253
With a remaining maturity of more than three years ....... 132
Bank's liability on acceptances executed and outstanding ....... 1,698
Subordinated notes and debentures .............................. 5,715
Other liabilities .............................................. 9,896
TOTAL LIABILITIES .............................................. 280,063
--------
EQUITY CAPITAL
Perpetual preferred stock and related surplus .................. 0
Common stock ................................................... 1,211
Surplus (exclude all surplus related to preferred stock) ....... 10,291
Undivided profits and capital reserves ......................... 5,502
Net unrealized holding gains (losses)
on available-for-sale securities .......................... (22)
Cumulative foreign currency translation adjustments ............ 16
TOTAL EQUITY CAPITAL ........................................... 16,998
--------
TOTAL LIABILITIES AND EQUITY CAPITAL ........................... $297,061
========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
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 appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
