As filed with the Securities and Exchange Commission on July 14, 1998
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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<TABLE>
<CAPTION>
FIRST CITIZENS BANCSHARES, INC. FCB/NC CAPITAL TRUST I
<S> <C>
(Exact name of registrant as specified in its charter) (Exact name of registrant as specified in its charter)
Delaware Delaware
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
56-1528994 51-6507188
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
3128 Smoketree Court 3128 Smoketree Court
Raleigh, North Carolina 27604 Raleigh, North Carolina 27604
(919) 716-7000 (919) 716-7000
(Address, including zip code, and telephone number, (Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices) including area code, of registrant's principal
executive offices)
</TABLE>
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KENNETH A. BLACK
Vice President and Chief Financial Officer
First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, North Carolina 27604
(919) 716-7000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copy to:
WILLIAM R. LATHAN, JR., Esq.
Ward and Smith, P.A.
1001 College Court
New Bern, North Carolina 28560
(252) 633-1000
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Approximate date of commencement of the proposed sale to the public:
As soon as practicable after the Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Title of each class
of securities to
be registered Amount to be registered
<S> <C>
New Capital Securities of FCB/NC
Capital Trust I ......................... 150,000
New Junior Subordinated Debentures
due March 1, 2028 of First Citizens
BancShares, Inc. (3) .................... (5)
Guarantee of Capital Securities by
First Citizens BancShares, Inc. (4) ..... (5)
<CAPTION>
Proposed
Title of each class Proposed maximum maximum
of securities to offering price per share/ aggregate offering price Amount of registration
be registered unit (1) (1) fee (2)
<S> <C> <C> <C>
New Capital Securities of FCB/NC
Capital Trust I ......................... $1,000 $150,000,000 $44,250
New Junior Subordinated Debentures
due March 1, 2028 of First Citizens
BancShares, Inc. (3) .................... -- -- --
Guarantee of Capital Securities by
First Citizens BancShares, Inc. (4) ..... -- -- --
</TABLE>
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(1) Represents the Liquidation Amount of the 8.05% Capital Securities originally
issued by FCB/NC Capital Trust I (the "Issuer Trust") on March 5, 1998 (the
"Old Capital Securities") which are to be exchanged hereunder for newly
issued 8.05% Capital Securities of the Issuer Trust (the "New Capital
Securities") and the principal amount of Junior Subordinated Deferrable
Interest Debentures originally issued by the Company on March 5, 1998 (the
"Old Junior Subordinated Debentures") which are to be exchanged hereunder
for newly issued Junior Subordinated Deferrable Interest Debentures (the
"New Junior Subordinated Debentures").
(2) The registration fee is calculated in accordance with Section 6 of the
Securities Act of 1933, as amended.
(3) The New Junior Subordinated Debentures may later be distributed for no
additional consideration to the holders of the New Capital Securities of
the Issuer Trust upon its dissolution and the distribution of its assets.
(4) No separate consideration will be received by First Citizens BancShares,
Inc. (the "Company") for the Guarantee.
(5) This Registration Statement is deemed to cover the New Junior Subordinated
Debentures of the Company, the rights of holders of the New Junior
Subordinated Debentures under the Junior Subordinated Indenture (as defined
herein), the rights of holders of the New Capital Securities under the Trust
Agreement (as defined herein), and the rights of holders of the New Capital
Securities under the Guarantee.
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
PROSPECTUS
FCB/NC Capital Trust I
Offer to Exchange 8.05% Capital Securities
(Liquidation Amount $1,000 per Capital Security)
which have been registered under the Securities Act of 1933
for any and all
Outstanding 8.05% Capital Securities
(Liquidation Amount $1,000 per Capital Security)
all as fully and unconditionally guaranteed, to the extent described herein, by
First Citizens BancShares, Inc.
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THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 PM,
NEW YORK CITY TIME, ON , 1998, UNLESS EXTENDED.
---------------
FCB/NC Capital Trust I (the "Issuer Trust"), a statutory business trust
created under the laws of the State of Delaware, together with First Citizens
BancShares, Inc., a Delaware corporation (the "Company"), as depositor of the
Issuer Trust, hereby offer upon the terms and subject to the conditions set
forth in this Prospectus (as the same may be amended or supplemented from time
to time, the "Prospectus") and in the accompanying Letter of Transmittal (which
together constitute the "Exchange Offer"), to exchange up to $150,000,000
aggregate Liquidation Amount (as defined herein) of newly issued 8.05% Capital
Securities of the Issuer Trust (the "New Capital Securities") which have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
pursuant to a Registration Statement (as defined herein) of which this
Prospectus constitutes a part, for a like Liquidation Amount of the Issuer
Trust's outstanding 8.05% Capital Securities (the "Old Capital Securities"), of
which $150,000,000 aggregate liquidation amount is outstanding. Pursuant to the
Exchange Offer, the Company is also exchanging (i) its guarantee of the New
Capital Securities, to the extent provided therein (the "Guarantee") for its
guarantee of the Old Capital Securities (the "Old Guarantee"), and (ii) up to
$150,000,000 aggregate principal amount of newly issued Junior Subordinated
Deferrable Interest Debentures (the "New Junior Subordinated Debentures") for a
like amount of its outstanding Junior Subordinated Deferrable Interest
Debentures (the "Old Junior Subordinated Debentures"). The Guarantee and the New
Junior Subordinated Debentures also have been registered under the Securities
Act. See "Certain Defined Terms," "Summary," "The Exchange Offer," "Description
of the New Capital Securities," "Description of the New Junior Subordinated
Debentures," "Description of the Guarantee," and "Relationship Among the Capital
Securities, the Junior Subordinated Debentures and the Guarantee."
The terms of the New Capital Securities are identical in all material
respects to the respective terms of the Old Capital Securities, except that (i)
the New Capital Securities have been registered under the Securities Act and,
therefore, will not be subject to certain restrictions on transfer applicable to
the Old Capital Securities, (ii) the New Capital Securities will not provide for
any increase in the Distribution rate thereon, subject to certain limited
exceptions specified in the Registration Rights Agreement described below, and
(iii) the New Junior Subordinated Debentures will not provide for any increase
in the interest rate thereon. See "Description of the New Capital Securities"
and "Description of the New Junior Subordinated Debentures." The New Capital
Securities are being offered for exchange in order to satisfy certain
obligations of the Company and the Issuer Trust under the Registration Rights
Agreement dated March 5, 1998, between the Company, the Issuer Trust and the
Initial Purchaser (as defined herein) (the "Registration Rights Agreement").
(Continued on next page.)
SEE "CERTAIN DEFINED TERMS" ON PAGE 6 OF THIS PROSPECTUS FOR A GLOSSARY OF
CERTAIN CAPITALIZED TERMS USED IN THIS PROSPECTUS WITHOUT DEFINITION.
SEE "RISK FACTORS" BEGINNING ON PAGE 16 OF THIS PROSPECTUS FOR CERTAIN
INFORMATION RELEVANT TO HOLDERS WHO TENDER OLD CAPITAL SECURITIES IN THE
EXCHANGE OFFER.
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THESE SECURITIES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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The New Capital Securities will be issued, and may be transferred, only in
blocks having a Liquidation Amount of not less than $100,000 (100 Capital
Securities). Any transfer, sale or other disposition of Capital Securities in a
block having a Liquidation Amount of less than $100,000 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 Capital Securities for any purpose, including but not
limited to the receipt of Distributions on such Capital Securities, and such
transferee shall be deemed to have no interest whatsoever in such Capital
Securities.
The date of this Prospectus is , 1998.
<PAGE>
(cover page continued)
Based on interpretations by the staff of the Securities and Exchange
Commission (the "Commission"), as set forth in no-action letters issued to third
parties, the Company and the Issuer Trust believe that the New Capital
Securities issued pursuant to the Exchange Offer may be offered for resale,
resold or otherwise transferred by holders thereof (other than any holder that
is an "affiliate" of the Company or the Issuer Trust as defined under Rule 405
of the Securities Act), provided that such New Capital Securities are acquired
in the ordinary course of such holders' business and such holders are not
engaged in, and do not intend to engage in, a distribution of such New Capital
Securities and have no arrangement or understanding with any person to
participate in the distribution of such New Capital Securities. However, the
staff of the Commission has not considered the Exchange Offer in the context of
a no-action letter, and there can be no assurance that the staff of the
Commission would make a similar determination with respect to the Exchange Offer
as in such other circumstances. By tendering the Old Capital Securities in
exchange for New Capital Securities, each holder, other than a broker-dealer,
will represent to the Company and the Issuer Trust that: (i) it is not an
affiliate of the Company or the Issuer Trust (as defined under Rule 405 of the
Securities Act); (ii) any New Capital Securities to be received by it were
acquired in the course of its ordinary business; and (iii) it is not engaged in,
and does not intend to engage in, a distribution of the New Capital Securities
and has no arrangement or understanding to participate in a distribution of the
New Capital Securities. See "Risk Factors -- Consequences of a Failure to
Exchange Old Capital Securities" and "The Exchange Offer -- Resales of New
Capital Securities."
Each broker-dealer that receives New Capital Securities for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such New Capital Securities. The
Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. This Prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of New Capital Securities received in exchange for
Old Capital Securities where such Old Capital Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities. The Company and the Issuer Trust have agreed that, starting on the
date on which the Exchange Offer is consummated and ending on the close of
business ninety (90) days after such date, they will make this Prospectus
available to any broker-dealer for use in connection with any such resale. See
"Plan of Distribution."
In that regard, each Participating Broker-Dealer (as defined herein) who
surrenders Old Capital Securities pursuant to the Exchange Offer will be deemed
to have agreed, by execution of the Letter of Transmittal, that, upon receipt of
notice from the Company or the Issuer Trust of the occurrence of any event or
the discovery of any fact which makes any statement contained or incorporated by
reference in this Prospectus untrue in any material respect or which causes this
Prospectus to omit to state a material fact necessary in order to make the
statements contained or incorporated by reference herein, in light of the
circumstances under which they were made, not misleading, or of the occurrence
of certain other events specified in the Registration Rights Agreement, such
Participating Broker-Dealer will suspend the sale of New Capital Securities (or
the Guarantee or the New Junior Subordinated Debentures, as applicable) pursuant
to this Prospectus until the Company or the Issuer Trust has amended or
supplemented this Prospectus to correct such misstatement or omission and has
furnished copies of the amended or supplemented Prospectus to such Participating
Broker-Dealer, or until the Company or the Issuer Trust has given notice that
the sale of the New Capital Securities (or the Guarantee or the New Junior
Subordinated Debentures, as applicable) may be resumed, as the case may be.
Prior to the Exchange Offer, there has been only a limited secondary market
and no public market for the Old Capital Securities. The New Capital Securities
will be a new issue of securities for which there currently is no market.
Although the Initial Purchaser (as defined herein) has informed the Company and
the Issuer Trust that it currently intends to make a market in the New Capital
Securities, it is not obligated to do so, and any such market making may be
discontinued at any time without notice. Accordingly, there can be no assurance
as to the development or liquidity of any market for the New Capital Securities.
Neither the Company nor the Issuer Trust currently intends to apply for listing
of the New Capital Securities on any securities exchange or for quotation
through the National Association of Securities Dealers Automated Quotation
System.
Any Old Capital Securities not tendered and accepted in the Exchange Offer
will remain outstanding and will be entitled to all the same rights and will be
subject to the same limitations applicable thereto under the Trust Agreement
(except for those rights which terminate upon consummation of the Exchange
Offer). Any Old Capital Securities which remain outstanding after consummation
of the Exchange Offer and the New Capital Securities issued in the Exchange
Offer will vote together as a single class for purposes of determining whether
holders of the requisite percentage in outstanding Liquidation Amount thereof
have taken certain actions or exercised certain rights under the Trust
Agreement. Following consummation of the Exchange Offer, the holders of Old
Capital Securities will continue to be subject to all of the existing
restrictions
2
<PAGE>
upon transfer thereof, and neither the Company nor the Issuer Trust will have
any further obligation to such holders (other than under certain limited
circumstances) to provide for registration under the Securities Act of the Old
Capital Securities held by them. To the extent that Old Capital Securities are
tendered and accepted in the Exchange Offer, a holder's ability to sell
untendered Old Capital Securities could be adversely affected. See "Risk Factors
- -- Consequences of a Failure to Exchange Old Capital Securities."
The New Capital Securities offered hereby represent undivided beneficial
interests in the assets of the Issuer Trust. The Company has acquired all the
Common Securities of the Issuer Trust. The Issuer Trust exists for the sole
purpose of issuing the Trust Securities, investing the proceeds thereof in the
Junior Subordinated Debentures of the Company, effecting the Exchange Offer, and
certain other limited activities described herein.
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF OLD CAPITAL SECURITIES ARE URGED TO READ THIS PROSPECTUS
AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO
TENDER THEIR OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER.
Old Capital Securities may be tendered for exchange on or prior to 5:00
p.m., New York City time, on , 1998 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by the Company and the Issuer Trust (in which case the term "Expiration Date"
shall mean the latest date and time to which the Exchange Offer is extended).
Tenders of Old Capital Securities may be withdrawn at any time on or prior to
the Expiration Date. The Exchange Offer is not conditioned upon any minimum
Liquidation Amount of Old Capital Securities being tendered for exchange.
However, the Exchange Offer is subject to certain events and conditions which
may be waived by the Company or the Issuer Trust and to the terms and provisions
of the Registration Rights Agreement. The Company has agreed to pay all expenses
of the Exchange Offer. See "The Exchange Offer -- Fees and Expenses." Each New
Capital Security will pay cumulative Distributions from the most recent
Distribution Date of the Old Capital Securities surrendered in exchange for such
New Capital Securities or, if no Distributions have been paid on such Old
Capital Securities, from March 5, 1998. Holders of the Old Capital Securities
whose Old Capital Securities are accepted for exchange will not receive
accumulated Distributions on such Old Capital Securities for any period from and
after the last Distribution Date on such Old Capital Securities prior to the
original issue date of the New Capital Securities or, if no such Distributions
have been paid, will not receive any accumulated Distributions on such Old
Capital Securities, and will be deemed to have waived the right to receive any
Distributions on such Old Capital Securities accumulated from and after such
Distribution Date or, if no such Distributions have been paid or duly provided
for, from and after March 5, 1998. However, because Distributions on the New
Capital Securities will accumulate from such date, the amount of the
Distributions received by holders whose Old Capital Securities are accepted for
exchange will not be affected by the exchange. This Prospectus, together with
the Letter of Transmittal, is being sent to all registered holders of Old
Capital Securities as of , 1998.
Neither the Company nor the Issuer Trust will receive any cash proceeds
from the issuance of the New Capital Securities offered hereby. No
dealer-manager is being used in connection with this Exchange Offer.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THE
SECURITIES TO WHICH IT RELATES OR AN OFFER TO ANY PERSON IN ANY JURISDICTION
WHERE SUCH OFFER WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE OF SUCH INFORMATION.
3
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of Sections 13 and
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and in accordance therewith files reports and other information with the
Commission. The Company intends to seek an order from the commission
conditionally exempting the Issuer Trust from the reporting requirements of the
Exchange Act pursuant to Section 12(h) thereof, and, therefore, it is not
expected that the Issuer Trust will be filing separate reports under the
Exchange Act. Any reports, proxy and information statements and other
information filed by the Company with the Commission may be inspected and copied
at the public reference facilities maintained by the Commission at Judiciary
Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's regional offices in Chicago, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661, and in New York, Seven World Trade Center, 13th Floor,
New York, New York 10048. Copies of such material may also be obtained by mail
from the Public Reference Section of the Commission at Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
maintains a Web site (http://www.sec.gov) that contains reports, proxy and
information statements and other information regarding registrants who file
electronically with the Commission. In addition, such reports, proxy statements
and other information can be inspected at Nasdaq, 1735 K Street, N.W.,
Washington, D.C. 20006, on whose National Market System the Company's Class A
common stock is traded.
No separate financial statements of the Issuer Trust have been included or
incorporated by reference herein. The Company and the Issuer Trust do not
consider that such financial statements would be material to holders of the
Capital Securities because the Issuer Trust has no independent operations and is
not engaged in and does not propose to engage in any activity other than holding
as trust assets the Junior Subordinated Debentures, issuing the Trust
Securities, effecting the Exchange Offer and engaging in activities necessary or
incidental thereto. All of the Common Securities of the Issuer Trust are owned
by the Company and the Company's obligations described herein under the Junior
Subordinated Indenture, the Trust Agreement (including its obligations to pay
costs, expenses, debts and other obligations of the Issuer Trust, other than
with respect to the Trust Securities), the Junior Subordinated Debentures and
the Guarantee, taken together, constitute a full and unconditional guarantee on
a subordinated basis by the Company of amounts due on the Capital Securities.
See "FCB/NC Capital Trust I," "Description of the New Capital Securities,"
"Description of the New Junior Subordinated Debentures," "Description of the
Guarantee," and "Relationship Among the Capital Securities, the Junior
Subordinated Debentures and the Guarantee." In addition, the Company does not
expect that the Issuer Trust will file reports under the Exchange Act with the
Commission.
This Prospectus constitutes a part of a Registration Statement on Form S-4
(together with all exhibits thereto, the "Registration Statement") filed by the
Company and the Issuer Trust with the Commission under the Securities Act. This
Prospectus does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission, and reference is hereby made to the Registration
Statement for further information with respect to the Company, the Issuer Trust
and the New Capital Securities. Any statements contained herein concerning the
provisions of any document are not necessarily complete and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference.
This Prospectus may contain or incorporate by reference statements which
may constitute "forward-looking statements" within the meaning of Section 27A of
the Securities Act and Section 21E of the Exchange Act. Prospective investors
are cautioned that any such forward-looking statements are not guarantees for
future performance and involve risks and uncertainties, and that actual results
may differ materially from those contemplated by such forward-looking
statements. Important factors currently known to management that could cause
actual results to differ materially from those in forward-looking statements
include significant fluctuations in interest rates, inflation, economic
recession, significant changes in the federal and state legal and regulatory
environment and tax laws, significant underperformance in the Company's
portfolio of outstanding loans, and competition in the Company's markets.
Neither the Company nor the Issuer Trust undertakes any obligation to update or
revise forward-looking statements to reflect changed assumptions, the occurrence
of unanticipated events or changes to future operating results over time.
4
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with the
Commission, are incorporated by reference in this Prospectus: (i) the Company's
Annual Report on Form 10-K for the year ended December 31, 1997, and (ii) the
Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of any offering of securities hereunder shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated by reference or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for all purposes of the Registration
Statement and this Prospectus to the extent that a statement contained herein or
in any subsequently filed document that is also incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the Registration Statement or this
Prospectus. As used herein, the terms "Prospectus" and "herein" mean this
Prospectus, including the documents incorporated or deemed to be incorporated
herein by reference, as the same may be amended, supplemented or otherwise
modified from time to time. Statements contained in this Prospectus as to the
contents of any contract or other document referred to herein do not purport to
be complete, and where reference is made to the particular provisions of such
contract or other document, such provisions are qualified in all respects by
reference to all of the provisions of such contract or other document.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON REQUEST FROM
THE COMPANY AT 3128 SMOKETREE COURT, RALEIGH, NORTH CAROLINA 27604 (TELEPHONE
NUMBER 919-716-7000), ATTENTION: KENNETH A. BLACK, CHIEF FINANCIAL OFFICER. IN
ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY
, 1998, WHICH IS THE DATE FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION DATE.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page No.
---------
<S> <C>
Available Information .................................................................... 4
Incorporation of Certain Documents by Reference .......................................... 5
Certain Defined Terms .................................................................... 6
Summary .................................................................................. 7
Risk Factors ............................................................................. 16
First Citizens BancShares, Inc. .......................................................... 22
Consolidated Ratios of Earnings to Fixed Charges ......................................... 23
Selected Consolidated Financial Data and Other Information ............................... 23
FCB/NC Capital Trust I ................................................................... 24
Accounting Treatment ..................................................................... 24
The Exchange Offer ....................................................................... 24
Description of the New Capital Securities ................................................ 32
Description of the New Junior Subordinated Debentures .................................... 44
Description of the Guarantee ............................................................. 53
Relationship among the Capital Securities, the Junior Subordinated Debentures and the
Guarantee............................................................................... 54
Certain Federal Income Tax Consequences .................................................. 56
Plan of Distribution ..................................................................... 59
Certain ERISA Considerations ............................................................. 60
Supervision, Regulation and Other Matters ................................................ 61
Legal Matters ............................................................................ 66
Experts .................................................................................. 66
</TABLE>
5
<PAGE>
CERTAIN DEFINED TERMS
As used in this Prospectus, the following terms have the meanings
indicated:
"Capital Securities" means the New Capital Securities and the Old Capital
Securities of the Issuer Trust, each representing undivided beneficial interests
in the assets of the Issuer Trust.
"Common Securities" means the common securities of the Issuer Trust
representing undivided beneficial interests in the assets of the Issuer Trust.
"Company" means First Citizens BancShares, Inc., a Delaware corporation.
"Distribution Date" means the 1st day of March and September in each year,
beginning March 1, 1999.
"Exchange Agent" means Bankers Trust Company, which also acts as the
Property Trustee under the Trust Agreement, the Debenture Trustee under the
Junior Subordinated Indenture, and the Guarantee Trustee under the Guarantee.
"Exchange Offer" means the offer made herein and in the accompanying Letter
of Transmittal by the Company and the Issuer Trust to exchange up to
$150,000,000 aggregate Liquidation Amount of New Capital Securities for a like
amount of Old Capital Securities.
"Guarantee" means the Guarantee Agreement from the Company in favor of
Bankers Trust Company, as Guarantee Trustee for the benefit of the holders of
Capital Securities, to be issued in exchange for the Old Guarantee.
"Indenture" means the Junior Subordinated Indenture, dated as of March 5,
1998, between the Company and Bankers Trust Company, as Trustee for the benefit
of the holders of the Junior Subordinated Debentures, and any indenture
supplemental thereto pursuant to which the Junior Subordinated Debentures are to
be issued.
"Interest Payment Date" means the 1st day of March and September in each
year, beginning March 1, 1999.
"Issuer Trust" means FCB/NC Capital Trust I, a Delaware business trust.
"Junior Subordinated Debentures" means the New Junior Subordinated
Debentures and the Old Junior Subordinated Debentures.
"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
"New Capital Securities" means up to $150,000,000 aggregate Liquidation
Amount of newly issued 8.05% Capital Securities to be issued by the Issuer Trust
in exchange for Old Capital Securities.
"New Junior Subordinated Debentures" means up to $150,000,000 aggregate
principal amount of newly issued 8.05% Junior Subordinated Deferrable Interest
Debentures due March 1, 2028, to be issued by the Company to the Issuer Trust in
exchange for a like amount of Old Junior Subordinated Debentures.
"Old Capital Securities" means the $150,000,000 aggregate Liquidation
Amount of 8.05% Capital Securities issued by the Issuer Trust on March 5, 1998.
"Old Guarantee" means the Guarantee Agreement, dated as of March 5, 1998,
from the Company in favor of Bankers Trust Company, as Guarantee Trustee for the
benefit of the holders of Old Capital Securities.
"Old Junior Subordinated Debentures" means the $150,000,000 aggregate
principal amount of Junior Subordinated Deferrable Interest Debentures issued by
the Company to the Issuer Trust on March 5, 1998.
"Registration Rights Agreement" means the Registration Rights Agreement,
dated as of March 5, 1998, among the Issuer Trust, the Company, and Wheat First
Securities, Inc. as Initial Purchaser (the "Initial Purchaser").
"Trust Agreement" means the Amended and Restated Trust Agreement, dated as
of March 5, 1998, among the Company as Depositor, Bankers Trust Company as
property trustee (the "Property Trustee"), Bankers Trust (Delaware) as Delaware
trustee (the "Delaware Trustee"), the Administrators appointed pursuant to
Section 8.20 thereof, and the holders, from time to time, of undivided
beneficial interests in the assets of the Issuer Trust, pursuant to which
Capital Securities were, and will be, issued.
"Trust Securities" means the Common Securities and the Capital Securities.
6
<PAGE>
SUMMARY
The following summary is qualified in its entirety by, and should be read
in conjunction with, the more detailed information and the financial statements,
including the notes thereto, appearing elsewhere or incorporated by reference
herein. Holders of Old Capital Securities should consider carefully the factors
set forth herein under "Risk Factors."
First Citizens BancShares, Inc.
The Company is a registered bank holding company, chartered under the laws
of Delaware, and headquartered in Raleigh, North Carolina. The Company operates
through, and its principal assets are its investments in, its three wholly-owned
banking subsidiaries, the largest of which is First-Citizens Bank & Trust
Company, Raleigh, North Carolina ("FCB/ NC"). The Company's other two banking
subsidiaries are First-Citizens Bank & Trust Company, White Sulphur Springs,
West Virginia ("FCB/WV"), and Atlantic States Bank, Raleigh, North Carolina
("ASB"). FCB/NC, FCB/WV, and ASB (collectively referred to herein as the
"Banks") provide a wide variety of retail and commercial banking products and
services to individuals and small- to medium-sized businesses located in the
communities they serve. At March 31, 1998, the Company had total consolidated
assets of approximately $9.3 billion, total consolidated deposits of
approximately $7.9 billion, and total consolidated shareholders' equity of
approximately $615.0 million.
FCB/NC is a North Carolina-chartered bank that currently maintains 349
banking offices in 209 communities in North Carolina and Virginia. FCB/WV is a
West Virginia-chartered bank that currently maintains four banking offices in
four communities in West Virginia. ASB is a federally-chartered savings bank
based in Raleigh, North Carolina, that currently maintains eleven branch offices
located in the vicinity of Atlanta, Georgia.
Management of the Company is led by members of the Holding family, which
collectively controls 43.0% of the Class A, and 68.8% of the Class B (with a
16-to-1 voting preference over the shares of Class A), common stock of the
Company. As a result, the Company has been managed from a long-term perspective
with primary emphasis being placed on balance sheet liquidity, loan quality, and
earnings stability. Consistent with its management philosophy, the Company has
emphasized a low-risk loan portfolio derived from its local markets. At March
31, 1998, the Company's loan-to-deposit ratio was 70.65%, and its non-performing
assets were $16.3 million, or 0.29% of gross loans and other real estate. Net
charge-offs for the three months ended March 31, 1998, were 0.21% of average
loans. The allowance for loan losses at March 31, 1998, was 1.55% of gross loans
and 581.1% of non-performing loans.
The Company's strategy includes continuing to: (i) provide
community-oriented banking services with a focus on offering a complete array of
financial services for small- and medium-sized businesses and to individuals
within the communities in which it operates; (ii) increase its loan to deposit
ratio while maintaining above-average credit quality measurements; and (iii)
make the necessary investments in technology to remain competitive with the
larger banking organizations in its markets from a product delivery and customer
service standpoint. Management believes that as its largest super-regional
competitors continue to focus on larger dollar transactions and less personal
forms of customer service, and as smaller banking organizations become less
capable of providing the advanced levels of customer service required in today's
banking market, the Company will have significant opportunities to continue to
expand its franchise and further penetrate its targeted markets.
The Company's principal executive offices are located at 3128 Smoketree
Court, Raleigh, North Carolina 27604, and its telephone number is (919)
716-7000.
For additional information regarding the Company and its financial
condition and results of operations, see "Available Information," "Incorporation
of Certain Documents by Reference," "First Citizens BancShares, Inc." and
"Selected Consolidated Financial Data and Other Information."
FCB/NC Capital Trust I
The Issuer Trust is a statutory business trust created under Delaware law
on February 27, 1998 and which is governed by the Trust Agreement. The Issuer
Trust exists for the exclusive purposes of (i) issuing and selling the Trust
Securities, (ii) using the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures, (iii) effecting the Exchange Offer
by exchanging up to $150,000,000 aggregate Liquidation Amount of the New Capital
Securities for a like amount of the Old Capital Securities, and (iv) engaging in
only those other activities necessary, convenient or incidental
7
<PAGE>
thereto (such as registering the transfer of the Trust Securities). Accordingly,
the Junior Subordinated Debentures will be the sole assets of the Issuer Trust,
and payments under the Junior Subordinated Debentures will be the sole source of
revenue of the Issuer Trust.
The Exchange Offer
The Exchange Offer ............. Up to $150,000,000 aggregate Liquidation
Amount of New Capital Securities are being
offered in exchange for a like aggregate
Liquidation Amount of Old Capital Securities.
Old Capital Securities may be tendered for
exchange in whole or in part in a Liquidation
Amount of $100,000 (100 Capital Securities)
or any integral multiple of $1,000 in excess
thereof. The Company and the Issuer Trust are
making the Exchange Offer in order to satisfy
their obligations under the Registration
Rights Agreement relating to the Old Capital
Securities. For a description of the
procedures for tendering Old Capital
Securities, see "The Exchange Offer --
Procedure for Tendering Old Capital
Securities."
Expiration Date................. 5:00 p.m., New York City time, on ,
1998 (such time on such date being
hereinafter called the "Expiration Date")
unless the Exchange Offer is extended by the
Company and the Issuer Trust (in which case
the term "Expiration Date" shall mean the
latest date and time to which the Exchange
Offer is extended). See "The Exchange Offer
-- Expiration Date; Extensions; Amendments."
Conditions to the
Exchange Offer.................. The Exchange Offer is subject to certain
conditions, which may be waived by the
Company and the Issuer Trust in their sole
discretion. The Exchange Offer is not
conditioned upon any minimum Liquidation
Amount of Old Capital Securities being
tendered. See "The Exchange Offer --
Conditions to the Exchange Offer." The
Company and the Issuer Trust reserve the
right in their sole and absolute discretion,
subject to applicable law, at any time and
from time to time, (i) to delay the
acceptance of the Old Capital Securities for
exchange, (ii) to terminate the Exchange
Offer if certain specified conditions have
not been satisfied, (iii) to extend the
Expiration Date of the Exchange Offer and
retain all Old Capital Securities tendered
pursuant to the Exchange Offer, subject,
however, to the right of holders of Old
Capital Securities to withdraw their tendered
Old Capital Securities, or (iv) to waive any
condition or otherwise amend the terms of the
Exchange Offer in any respect. See "The
Exchange Offer -- Expiration Date;
Withdrawal Rights............... Tenders of Old Capital Securities may be
withdrawn at any time on or prior to the
Expiration Date by delivering a written
notice of such withdrawal to the Exchange
Agent in conformity with certain procedures
set forth below under "The Exchange Offer --
Withdrawal Rights."
Procedures for Tendering
Old Capital Securities.......... Tendering holders of Old Capital Securities
must complete and sign a Letter of
Transmittal in accordance with the
instructions contained therein and forward
the same by mail, facsimile or hand delivery,
together with any other required documents,
to the Exchange Agent, either with the Old
Capital Securities to be tendered or in
compliance with the specified procedures for
guaranteed delivery of Old Capital
Securities. Certain brokers, dealers,
commercial banks, trust companies and other
nominees may also effect tenders by
book-entry transfer including an Agent's
Message (as defined herein) in lieu of a
Letter of Transmittal. Holders of Old Capital
Securities registered in the name of a
broker, dealer, commercial bank, trust
company or other
8
<PAGE>
nominee are urged to contact such person
promptly if they wish to tender Old Capital
Securities pursuant to the Exchange Offer.
See "The Exchange Offer -- Procedure for
Tendering Old Capital Securities." Letters of
Transmittal and certificates representing Old
Capital Securities should not be sent to the
Company or the Issuer Trust. Such documents
should only be sent to the Exchange Agent.
Questions regarding how to tender and
requests for information should be directed
to the Exchange Agent. See "The Exchange
Offer -- Exchange Agent."
Resales of New
Capital Securities.............. Based on interpretations by the staff of the
Commission (the "Staff") as set forth in
no-action letters issued to third parties,
the Company and the Issuer Trust believe that
holders of Old Capital Securities (other than
any holder that is an "affiliate" of the
Company or the Issuer Trust as defined under
Rule 405 of the Securities Act) who exchange
their Old Capital Securities for New Capital
Securities pursuant to the Exchange Offer may
offer such New Capital Securities for resale,
resell such New Capital Securities and
otherwise transfer such New Capital
Securities without compliance with the
registration and prospectus delivery
provisions of the Securities Act, provided
that such New Capital Securities are acquired
in the ordinary course of such holders'
business and such holders are not engaged in,
and do not intend to engage in, a
distribution of such New Capital Securities
and have no arrangement or understanding with
any person to participate in the distribution
of such New Capital Securities. However, the
Staff has not considered the Exchange Offer
in the context of a no-action letter, and
there can be no assurance that the Staff
would make a similar determination with
respect to the Exchange Offer.
Any holder of Old Capital Securities who is
an "affiliate" of the Company or the Issuer
Trust or who intends to participate in the
Exchange Offer for the purpose of
distributing the New Capital Securities, or
any broker-dealer who purchased the Old
Capital Securities from the Issuer Trust to
resell pursuant to Rule 144A or any other
available exemption under the Securities Act,
(i) will not be able to rely on the
interpretations of the Staff set forth in the
above-mentioned interpretive letters, (ii)
will not be permitted or entitled to tender
such Old Capital Securities in the Exchange
Offer, and (iii) must comply with the
registration and prospectus delivery
requirements of the Securities Act in
connection with any sale or other transfer of
such Old Capital Securities unless such sale
is made pursuant to an exemption from such
requirements. In addition, as described
below, if any broker-dealer holds Old Capital
Securities acquired for its own account as a
result of market-making or other trading
activities and exchanges such Old Capital
Securities for New Capital Securities, then
such broker-dealer must deliver a prospectus
meeting the requirements of the Securities
Act in connection with any resales of such
New Capital Securities.
Each holder of Old Capital Securities (other
than certain specified holders) who wishes to
exchange Old Capital Securities for New
Capital Securities in the Exchange Offer will
be required to represent that (i) it is not
an "affiliate" of the Company or the Issuer
Trust, (ii) any New Capital Securities to be
received by it are being acquired in the
ordinary course of its business, and (iii) it
is not engaged in, and does not intend to
engage in, a distribution (within the meaning
of the Securities Act) of such New Capital
Securities and has no arrangement or
understanding to participate in a
distribution of New Capital Securities. Each
broker-dealer that receives New Capital
Securities
9
<PAGE>
for its own account pursuant to the Exchange
Offer must acknowledge that it will deliver a
prospectus meeting the requirements of the
Securities Act in connection with any resale
of such New Capital Securities. The Letter of
Transmittal states that by so acknowledging
and by delivering a prospectus, a
broker-dealer will not be deemed to admit
that it is an "underwriter" within the
meaning of the Securities Act. Based on the
position taken by the Staff in the
interpretive letters referred to above, the
Company and the Issuer Trust believe that
broker-dealers who acquired Old Capital
Securities for their own accounts as a result
of market-making activities or other trading
activities ("Participating Broker-Dealers")
may fulfill their prospectus delivery
requirements with respect to the New Capital
Securities received upon exchange of such Old
Capital Securities (other than Old Capital
Securities which represent an unsold
allotment from the original sale of the Old
Capital Securities) with a prospectus meeting
the requirements of the Securities Act, which
may be the prospectus prepared for an
exchange offer so long as it contains a
description of the plan of distribution with
respect to the resale of such New Capital
Securities. Accordingly, this Prospectus, as
it may be amended or supplemented from time
to time, may be used by a Participating
Broker-Dealer in connection with resales of
New Capital Securities received in exchange
for Old Capital Securities where such Old
Capital Securities were acquired by such
Participating Broker-Dealer for its own
account as a result of market-making or other
trading activities. Subject to certain
provisions set forth in the Registration
Rights Agreement and to the limitations
described below under "The Exchange Offer --
Resales of New Capital Securities," the
Company and the Issuer Trust have agreed to
allow the Participating Broker-Dealers to use
this Prospectus in connection with resales of
such New Capital Securities for a period of
ninety (90) days after the Expiration Date,
exclusive of any period when a stop order is
in effect. See "Plan of Distribution." Any
Participating Broker-Dealer who is an
"affiliate" of the Company or the Issuer
Trust may not rely on such interpretive
letters and must comply with the registration
and prospectus delivery requirements of the
Securities Act in connection with any resale
transaction. See "The Exchange Offer --
Resales of New Capital Securities."
Exchange Agent.................. The Exchange Agent with respect to the
Exchange Offer is Bankers Trust Company. The
addresses and telephone and facsimile numbers
of the Exchange Agent are set forth in "The
Exchange Offer -- Exchange Agent" and in the
Letter of Transmittal.
Use of Proceeds................. Neither the Company nor the Issuer Trust will
receive any cash proceeds from the issuance
of the New Capital Securities offered hereby.
Certain Federal Income Tax Consequences;
Certain ERISA Considerations.... Holders of Old Capital Securities should
review the information set forth under
"Certain Federal Income Tax Consequences" and
"Certain ERISAConsiderations" prior to
tendering Old Capital Securities in the
Exchange Offer.
The New Capital Securities
Securities Offered.............. Up to $150,000,000 aggregate Liquidation
Amount of the Issuer Trust's 8.05% Capital
Securities which have been registered under
the Securities Act (Liquidation Amount $1,000
per Capital Security). The New Capital
Securities will be issued, and the Old
Capital Securities were
10
<PAGE>
issued, under the Trust Agreement. The New
Capital Securities and any Old Capital
Securities which remain outstanding after
consummation of the Exchange Offer will
constitute a single series of Capital
Securities under the Trust Agreement and,
accordingly, will vote together as a single
class for purposes of determining whether
holders of the requisite percentage in
outstanding Liquidation Amount thereof have
taken certain actions or exercised certain
rights under the Trust Agreement. See
"Description of the New Capital Securities
-- General." The terms of the New Capital
Securities are identical in all material
respects to the terms of the Old Capital
Securities, except that the New Capital
Securities have been registered under the
Securities Act and, therefore, are not
subject to certain restrictions on transfer
applicable to the Old Capital Securities
and, subject to certain limited exceptions
specified in the Registration Rights
Agreement, will not provide for any increase
in the Distribution rate thereon. See "The
Exchange Offer -- Purpose and Effect of the
Exchange Offer" and "Description of the New
Capital Securities."
Distributions................... Holders of the New Capital Securities are
entitled to receive cumulative cash
Distributions at an annual rate of 8.05% on
the Liquidation Amount of $1,000 per New
Capital Security, accruing from the last
Distribution Date on the Old Capital
Securities preceding the original issue date
of the New Capital Securities or, if no
Distributions have been made on the Old
Capital Securities, from the original date of
issuance of the Old Capital Securities (March
5, 1998), and (subject to the possible
extension of Distribution payment periods
described below) will be payable
semi-annually, in arrears, on the first day
of March and September of each year,
commencing March 1, 1999. See "Description of
the New Capital Securities -- Distributions."
Option to Extend Interest
Payment Period.................. The Company has the right, at any time,
subject to certain conditions, to defer
payments of interest on the Junior
Subordinated Debentures, for Extension
Periods, each not exceeding 10 consecutive
semi-annual periods; provided that no
Extension Period may extend beyond the
maturity date of the Junior Subordinated
Debentures or end on a date other than a
Distribution Date. As a consequence of the
Company's extension of the interest payment
period on the Junior Subordinated Debentures,
Distributions on the Capital Securities also
would be deferred, but would continue to
accrue during any such Extension Period to
the extent permitted by law. In the event the
Company exercises its right to extend an
interest payment period, then during any
Extension Period, subject to certain
exceptions, (i) the Company shall not declare
or pay any dividend on, make any
distributions with respect to, or redeem,
purchase, acquire or make a liquidation
payment with respect to, any of its capital
stock or rights to acquire such capital stock
or make any guarantee payments (other than
payments on the Guarantee) with respect to
the foregoing and (ii) the Company shall not
make any payment of interest on or principal
of (or premium, if any, on), or repay,
repurchase or redeem, any debt securities
issued by the Company which rank pari passu
with or junior to the Junior Subordinated
Debentures. Upon the termination of any
Extension Period and the payment of all
amounts then due, the Company may commence a
new Extension Period, subject to certain
requirements. See "Description of the New
Junior Subordinated Debentures -- Option to
Extend Interest Payment Period." Should an
Extension Period occur with respect to the
Capital Securities, holders of the Capital
Securities will
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<PAGE>
accrue interest income (in the form of
original issue discount), for United States
federal income tax purposes in respect of
their pro rata share of the Junior
Subordinated Debentures held by the Issuer
Trust. As a result, such holders will be
required to include such amounts in gross
income for United States federal income tax
purposes in advance of the receipt of cash,
and such holders will not receive the cash
from the Issuer Trust related to such income
if such holders dispose of the Capital
Securities prior to the record date for
payment of Distributions. See "Certain
Federal Income Tax Consequences -- Interest
Income and Original Issue Discount."
Liquidation..................... The Company, as the holder of all of the
Common Securities, has the right at any time
to dissolve the Issuer Trust (including,
without limitation, upon the occurrence of a
Tax Event, a Capital Treatment Event or an
Investment Company Event (each as defined
herein)), subject to certain conditions
(including the receipt of prior approval by
the Federal Reserve if then required under
applicable capital guidelines or policies of
the Federal Reserve), with the result that,
after satisfaction of liabilities to
creditors of the Issuer Trust (to the extent
not satisfied by the Company), the Company
must cause the Junior Subordinated Debentures
to be distributed to the holders of the Trust
Securities on a pro rata basis in accordance
with the respective Liquidation Amounts
thereof. In addition, the Issuer Trust will
be dissolved and liquidated under certain
other circumstances. See "Description of the
New Capital Securities -- Liquidation
Distribution on Dissolution."
Liquidation Distribution........ In the event of the voluntary or
involuntary liquidation, dissolution or
winding-up of the Issuer Trust, after
satisfaction of liabilities to creditors of
the Issuer Trust (to the extent not satisfied
by the Company), holders of the Capital
Securities will be entitled to receive a
Liquidation Distribution (as defined herein)
equal to $1,000 per Capital Security plus an
amount equal to accrued and unpaid
Distributions thereon to the date of payment,
unless the Junior Subordinated Debentures are
distributed to holders of the Trust
Securities in exchange therefor. If such
Liquidation Distribution can be paid only in
part because the Issuer Trust has
insufficient assets available to pay in full
the aggregate Liquidation Distribution, then
the amounts payable directly by the Issuer
Trust on the Capital Securities shall be paid
on a pro rata basis. The holders of the
Common Securities will be entitled to receive
distributions upon any such liquidation pro
rata with the holders of the Capital
Securities, except that if a Debenture Event
of Default (as defined herein) has occurred
and is continuing by reason of the failure to
pay amounts due with respect to the Junior
Subordinated Debentures, the Capital
Securities shall have a priority over the
Common Securities. See "Description of the
New Capital Securities -- Liquidation
Distribution on Dissolution."
Maturity........................ Upon the repayment of the Junior
Subordinated Debentures, whether at maturity
or upon early redemption as provided in the
Junior Subordinated Indenture, the proceeds
from such repayment will be applied by the
Property Trustee to redeem a like amount of
the Trust Securities, upon the terms and
conditions described herein. See "Description
of the New Capital Securities -- Redemption."
Redemption...................... The Trust Securities are subject to
mandatory redemption (i) in whole, but not in
part, at the Stated Maturity upon repayment
of the Junior Subordinated Debentures, (ii)
in whole, but not in part, contemporaneously
with the optional redemption at any time by
the Company of
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<PAGE>
the Junior Subordinated Debentures at any
time within 90 days following the occurrence
and during the continuation of a Tax Event,
Investment Company Event or Capital
Treatment Event, in each case subject to
possible regulatory approval, and (iii) in
whole or in part, at any time on or after
March 1, 2008, contemporaneously with the
optional redemption by the Company of the
Junior Subordinated Debentures in whole or
in part, in each case at the applicable
Redemption Price (as defined herein). See
"Description of the New Capital Securities
-- Redemption."
Tax Event, Capital Treatment Event and
Investment Company
Event Redemption................ If at any time a Tax Event, a Capital
Treatment Event or an Investment Company
Event should occur and be continuing, the
Company may, within 90 days of the occurrence
of such Tax Event, Capital Treatment Event or
Investment Company Event, as applicable,
redeem the Junior Subordinated Debentures in
whole or in part in certain limited
circumstances described herein at a
Redemption Price (as defined herein) equal to
par plus accrued and unpaid interest to the
redemption date, subject to the Company
having received prior approval from the
Federal Reserve if then required under
applicable capital guidelines or policies of
the Federal Reserve. Upon the redemption of
the Junior Subordinated Debentures, the
proceeds of such redemption will be applied
by the Property Trustee to redeem a like
amount of the Trust Securities on a pro rata
basis, upon the terms and conditions
described herein. See "Description of the New
Capital Securities -- Redemption."
The Guarantee................... The payment of Distributions out of moneys
held by the Issuer Trust, payments on
liquidation of the Issuer Trust, and payment
upon the redemption of the Capital Securities
are guaranteed by the Company to the extent
described herein under "Description of the
Guarantee." The Guarantee covers payments of
Distributions and other payments on the
Capital Securities only if and to the extent
that the Issuer Trust has funds available
therefor, which funds will not be available
except to the extent the Company has made
payments of interest or principal or other
payments on the Junior Subordinated
Debentures. The Guarantee, when taken
together with the Company's obligations under
the Junior Subordinated Debentures, the Trust
Agreement and the Junior Subordinated
Indenture (including its obligations to pay
costs, expenses, debts and other liabilities
of the Issuer Trust (other than with respect
to the Trust Securities)), provides a full
and unconditional guarantee on a subordinated
basis by the Company of amounts due on the
Capital Securities.
Ranking......................... The Common Securities rank pari passu with,
and payments thereon will be made pro rata
with, the Capital Securities, except that
upon the occurrence and continuation of a
Debenture Event of Default by reason of the
failure to pay amounts due with respect to
the Junior Subordinated Debentures, the
rights of the holders of the Common
Securities to receive payment of
Distributions and payments upon liquidation,
redemption or otherwise will be subordinated
to the rights of the holders of the Capital
Securities. See "Description of the New
Capital Securities -- General." The Junior
Subordinated Debentures are unsecured and
subordinate and junior in right of payment to
the extent and in the manner set forth in the
Junior Subordinated Indenture to all Senior
Indebtedness (as defined herein) of the
Company. See "Description of the New Junior
Subordinated Debentures --
13
<PAGE>
General." The Guarantee will constitute an
unsecured obligation of the Company and will
rank subordinate and junior in right of
payment to the extent and in the manner set
forth in the Guarantee to all Senior
Indebtedness of the Company. The Company's
obligations under the Guarantee and the
Junior Subordinated Debentures are also
effectively subordinate to claims of
creditors of the Company's subsidiaries. See
"Description of the Guarantee -- Status of
the Guarantee."
Voting Rights................... Holders of the Capital Securities have
limited voting rights relating generally to
the modification of the Capital Securities
and the Guarantee and the exercise of the
Issuer Trust's rights as the holder of the
Junior Subordinated Debentures. Holders of
the Capital Securities are not entitled to
appoint, remove or replace the Property
Trustee or the Delaware Trustee except upon
the occurrence of a Debenture Event of
Default (as defined herein) described herein.
See "Description of the New Capital
Securities -- Voting Rights, Amendment of
Trust Agreement" and " -- Removal of Issuer
Trustees; Appointment of Successors."
Rating.......................... The Old Capital Securities are, and the New
Capital Securities are expected to be, rated
"baa3" by Moody's Investors Service, Inc.,
and "BB+" by Standard & Poor's Ratings
Services. A security rating is not a
recommendation to buy, sell or hold
securities and may be subject to revision or
withdrawal at any time by the assigning
rating organization.
Transfer Restrictions........... The Old Capital Securities were, and the
New Capital Securities will be, issued and
may be transferred only in blocks having a
Liquidation Amount of not less than $100,000
(100 Old Capital Securities or New Capital
Securities, as the case may be). Any such
transfer of the Old Capital Securities or the
New Capital Securities in a block having a
Liquidation Amount of less than $100,000
shall be deemed to be void and of no legal
effect whatsoever. See "Description of the
New Capital Securities -- Restrictions on
Transfer."
Junior Subordinated Debentures... The Issuer Trust invested the proceeds from
the issuance of the Old Capital Securities
and Common Securities in an equivalent amount
of Old Junior Subordinated Debentures of the
Company, up to $150,000,000 aggregate
principal amount of which will be exchanged
for New Junior Subordinated Debentures. The
Junior Subordinated Debentures mature on
March 1, 2028, and rank subordinate and
junior in right of payment to all Senior
Indebtedness of the Company. In addition, the
Company's obligations under the Junior
Subordinated Debentures are effectively
subordinated to all existing and future
liabilities and obligations of its
subsidiaries. See "Risk Factors -- Ranking of
Subordinated Obligations Under the Guarantee
and the Junior Subordinated Debentures", and
"Description of the New Junior Subordinated
Debentures -- Subordination."
Form of Capital Securities...... The Old Capital Securities initially sold
to "qualified institutional buyers" (as
defined in Rule 144A under the Securities
Act) in reliance on Rule 144A under the
Securities Act are represented by a global
certificate or certificates registered in the
name of Cede & Co., as nominee for DTC. The
Old Capital Securities initially sold to
institutional "accredited investors" (as
defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) were issued only in
fully registered, certificated form.
Beneficial interests in the New Capital
Securities represented by a global
certificate or certificates will be evidenced
by, and transfers thereof will be effected
only through, records maintained by
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<PAGE>
the participants in DTC. Except in the
limited circumstances described herein, the
New Capital Securities in certificated form
will not be issued in exchange for the
global certificate or certificates. See
"Description of the New Capital Securities
-- Book-Entry Only Issuance -- The
Depository Trust Company."
For additional information with respect to the New Capital Securities, see
"Description of the New Capital Securities," "Description of the New Junior
Subordinated Debentures," "Description of the Guarantee," "Relationship Among
the Capital Securities, the Junior Subordinated Debentures, and the Guarantee,"
and "Certain Federal Income Tax Consequences."
RISK FACTORS
Holders of the Old Capital Securities should carefully consider the matters
set forth under "Risk Factors."
15
<PAGE>
RISK FACTORS
Prior to deciding whether to participate in the Exchange Offer, holders of
Old Capital Securities should carefully review the information contained
elsewhere, or incorporated by reference, in this Prospectus and should
particularly consider the following matters:
Consequences of a Failure to Exchange Old Capital Securities
The Old Capital Securities have not been registered under the Securities
Act or any state securities laws and therefore may not be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act and any other applicable securities laws, or pursuant to an
exemption therefrom or in a transaction not subject thereto, and in each case in
compliance with certain other conditions and restrictions. Old Capital
Securities which remain outstanding after consummation of the Exchange Offer
will continue to bear a legend reflecting such restrictions on transfer. In
addition, upon consummation of the Exchange Offer, holders of Old Capital
Securities which remain outstanding will not be entitled to any rights to have
such Old Capital Securities registered under the Securities Act or to any
similar rights under the Registration Rights Agreement (subject to limited
exceptions, if applicable). The Company and the Issuer Trust do not intend to
register under the Securities Act any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer (subject to limited
exceptions, if applicable).
To the extent that Old Capital Securities are tendered and accepted in the
Exchange Offer, a holder's ability to sell untendered Old Capital Securities
could be adversely affected. In addition, although the Old Capital Securities
have been designated for trading in the Private Offerings, Resale and Trading
through Automatic Linkages ("PORTAL") market, to the extent that Old Capital
Securities are tendered and accepted in connection with the Exchange Offer, any
trading market for Old Capital Securities which remain outstanding after the
Exchange Offer could be adversely affected.
The New Capital Securities and any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer will constitute a single
series of Capital Securities under the Trust Agreement and, accordingly, will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding Liquidation Amount thereof have taken
certain actions or exercised certain rights under the Trust Agreement. See
"Description of the New Capital Securities -- General."
Exchange Offer Procedures
Issuance of the New Capital Securities in exchange for Old Capital
Securities pursuant to the Exchange Offer will be made only after a timely
receipt by the Exchange Agent of such Old Capital Securities, a properly
completed and duly executed Letter of Transmittal (or an Agent's Message in lieu
thereof) and all other required documents. Therefore, holders of the Old Capital
Securities desiring to tender such Old Capital Securities in exchange for New
Capital Securities should carefully follow the exchange procedures described in
this Prospectus and allow sufficient time to ensure timely delivery to the
Exchange Agent. The Issuer Trust is under no duty to give notification of
defects or irregularities with respect to the tenders of Old Capital Securities
for exchange. See "Procedure for Tendering Old Capital Securities."
Ranking of Subordinated Obligations Under the Guarantee and the Junior
Subordinated Debentures
The obligations of the Company under the Guarantee issued by the Company
for the benefit of the holders of Capital Securities and under the Junior
Subordinated Debentures are subordinate and junior in right of payment to all
present and future Senior Indebtedness of the Company. No payment of principal
of (including redemption payments, if any) or interest on the Junior
Subordinated Debentures may be made if (i) any Senior Indebtedness of the
Company is not paid when due and any applicable grace period with respect to
such default has ended with such default not having been cured or waived or
ceasing to exist or (ii) the maturity of any Senior Indebtedness of the Company
has been accelerated because of a default. At March 31, 1998, the Senior
Indebtedness of the Company aggregated approximately $348.9 million. None of the
Junior Subordinated Indenture, the Guarantee or the Trust Agreement places any
limitation on the amount of secured or unsecured debt, including Senior
Indebtedness, that may be incurred by the Company. See "Description of the
Guarantee -- Status of the Guarantee" and "Description of the New Junior
Subordinated Debentures -- Subordination."
The ability of the Issuer Trust to pay amounts due on the Capital
Securities is solely dependent upon the Company's making payments on the Junior
Subordinated Debentures as and when required.
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Status of the Company as a Bank Holding Company
Because the Company is a bank holding company, its right to participate in
any distribution of assets of any of the Banks upon such Bank's liquidation or
reorganization or otherwise (and thus the ability of holders of the Capital
Securities to benefit indirectly from such a distribution) is subject to the
prior claims of creditors of that Bank (including its depositors), except to the
extent that the Company may itself be recognized as a creditor of the Bank. At
March 31, 1998, the Banks had total liabilities (excluding liabilities owed to
the Company) of approximately $8.32 billion, including deposits. Accordingly,
the Capital Securities effectively will be subordinated to all existing and
future liabilities of the Banks, and holders of Capital Securities should look
only to the assets of the Company for payments on the Capital Securities.
Neither the Guarantee nor the Junior Subordinated Indenture places any
limitation on the amount of secured or unsecured debt that may be incurred by
the Banks in the future. See "Description of the New Junior Subordinated
Debentures" and "Description of the Guarantee."
In addition, almost all of the operating assets of the Company are owned by
the Banks. The Company relies primarily on dividends from the Banks to meet its
obligations for the payment of principal and interest on its separate debt
obligations and corporate expenses and for payment of dividends on its
outstanding common stock. The payment of dividends by the Banks to the Company
is subject to certain legal and regulatory limitations, is subject to ongoing
review by banking regulators and, under certain circumstances, may require prior
approval by banking regulatory authorities. At March 31, 1998, approximately
$381.7 million was available for payment of dividends to the Company from the
Banks without prior regulatory approval. The Banks also are subject to certain
restrictions under federal law on extensions of credit to, and certain other
transactions with, the Company and certain of its other affiliates, and on
investments in the stock or other securities thereof. Such restrictions prevent
the Company and such other affiliates from borrowing from the Banks unless the
loans are secured by various types of collateral. Further, such secured loans or
other transactions and investments by each Bank are generally limited in amount
as to the Company and as to each such other affiliate to 10% of such Bank's
capital and surplus and as to the Company and all such other affiliates to an
aggregate of 20% of such Bank's capital and surplus.
Option to Extend Interest Payment Period; Tax Consequences
So long as no Event of Default (as defined in the Junior Subordinated
Indenture) has occurred and is continuing with respect to the Junior
Subordinated Debentures (a "Debenture Event of Default"), the Company has the
right under the Junior Subordinated Indenture to defer the payment of interest
on the Junior Subordinated Debentures at any time or from time to time for a
period not exceeding 10 consecutive semi-annual periods with respect to each
Extension Period, provided that no Extension Period may extend beyond the Stated
Maturity of the Junior Subordinated Debentures or end on a date other than a
Distribution Date. See "Description of the New Junior Subordinated Debentures --
Debenture Events of Default." As a consequence of any such deferral, semi-annual
Distributions on the Capital Securities by the Issuer Trust will be deferred
during any such Extension Period. Distributions to which holders of the Capital
Securities are entitled will accumulate additional Distributions thereon during
any Extension Period at a rate equal to 8.05% per annum, compounded
semi-annually from the relevant payment date for such Distributions, computed on
the basis of a 360-day year of twelve 30-day months and the actual days elapsed
in a partial month in such period. Additional Distributions payable for each
full Distribution period will be computed by dividing the rate per annum by two.
The term "Distributions" as used herein shall include any such additional
Distributions. During any such Extension Period, the Company may not (i) declare
or pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's capital 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 in
all respects with or junior in interest to the Junior Subordinated Debentures
(other than (a) repurchases, redemptions or other acquisitions of shares of
capital stock of the Company in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of any one or more
employees, officers, directors or consultants, in connection with a dividend
reinvestment or shareholder stock purchase plan or in connection with the
issuance of capital stock of the Company (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) the purchase of fractional interests in shares of the Company's capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged, (d) any declaration of a dividend in
connection with any shareholder's rights plan, or the issuance of rights, stock
or other property under any shareholder's rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or the stock issuable
upon exercise of such warrants, options or other rights is the same stock as
that on which the dividend is being paid or ranks pari
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passu with or junior to such stock). Prior to the termination of any such
Extension Period, the Company may further defer the payment of interest,
provided that no Extension Period may exceed 10 consecutive semi-annual periods,
extend beyond the Stated Maturity of the Junior Subordinated Debentures, or end
on a date other than a Distribution Date. Upon the termination of any Extension
Period and the payment of all interest then accrued and unpaid (together with
interest thereon at a rate equal to 8.05% per annum, compounded semi-annually),
the Company may elect to begin a new Extension Period subject to the above
conditions. No interest shall be due and payable during an Extension Period,
except at the end thereof. The Company must give the Issuer Trustees notice of
its election of such Extension Period at least one Business Day prior to the
earlier of (i) the date the Distributions on the Capital Securities would have
been payable but for the election to begin such Extension Period and (ii) the
date the Property Trustee is required to give notice to holders of the Capital
Securities of the record date or the date such Distributions are payable, but in
any event not less than one Business Day prior to such record date. The Property
Trustee will give notice of the Company's election to begin a new Extension
Period to the holders of the Capital Securities. Subject to the foregoing, there
is no limitation on the number of times that the Company may elect to begin an
Extension Period. See "Description of the New Capital Securities --
Distributions" and "Description of the New Junior Subordinated Debentures --
Option to Extend Interest Payment Period."
Should an Extension Period occur, a holder of Capital Securities will
accrue interest income (in the form of original issue discount) for United
States federal income tax purposes in respect of its pro rata share of the
Junior Subordinated Debentures held by the Issuer Trust. As a result, a holder
of Capital Securities will include such interest income in gross income for
United States federal income tax purposes in advance of the receipt of cash
attributable to such income, and will not receive the cash related to such
income from the Issuer Trust if the holder disposes of the Capital Securities
prior to the record date for the payment of Distributions with respect to such
Extension Period. See "Certain Federal Income Tax Consequences -- Interest
Income and Original Issue Discount" and " -- Sale or Redemption of Capital
Securities."
The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures. However, should the Company elect to exercise such
right in the future, the market price of the Capital Securities is likely to be
affected. A holder that disposes of its Capital Securities during an Extension
Period, therefore, might not receive the same return on its investment as a
holder that continues to hold its Capital Securities. In addition, as a result
of the existence of the Company's right to defer interest payments, the market
price of the Capital Securities (which represent preferred undivided beneficial
interests in the assets of the Issuer Trust) may be more volatile than the
market prices of other securities on which original issue discount accrues that
are not subject to such deferrals.
Tax Event, Investment Company Event or Capital Treatment Event Redemption;
Proposed Tax Law Changes
Upon the occurrence and during the continuation of a Tax Event, Investment
Company Event or Capital Treatment Event, the Company has the right to redeem
the Junior Subordinated Debentures in whole, but not in part, at any time within
90 days following the occurrence of such Tax Event, Investment Company Event or
Capital Treatment Event and thereby cause a mandatory redemption of the Capital
Securities and Common Securities. Any such redemption shall be at a price equal
to the aggregate Liquidation Amount of the Capital Securities and Common
Securities, respectively, together with accumulated Distributions to but
excluding the date fixed for redemption and the related amount of the premium,
if any, paid by the Company upon the concurrent redemption of such Junior
Subordinated Debentures. The ability of the Company to exercise its rights to
redeem the Junior Subordinated Debentures prior to the stated maturity may be
subject to prior regulatory approval by the Federal Reserve, if then required
under applicable Federal Reserve capital guidelines or policies. See
"Description of the New Junior Subordinated Debentures -- Redemption" and
"Description of the New Capital Securities -- Liquidation Distribution Upon
Dissolution."
A "Tax Event" means the receipt by the Issuer Trust of an opinion of
counsel to the Company 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 or administrative pronouncement or action 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 Capital Securities, there is more than an insubstantial risk
that (i) the Issuer Trust is, or will be within 90 days of the delivery of such
opinion, subject to United States federal income tax with respect to income
received or accrued on the Old Junior Subordinated Debentures or New Junior
Subordinated Debentures, (ii) interest payable by the Company on the Old Junior
Subordinated Debentures or New Junior Subordinated Debentures is not, or within
90 days of the delivery of such opinion will not be, deductible by the Company,
in whole or in part, for United States federal income
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tax purposes or (iii) the Issuer Trust is, or will be within 90 days of the
delivery of the opinion, subject to more than a de minimis amount of other
taxes, duties or other governmental charges. According to a petition recently
filed in the United States Tax court by a corporation unrelated to the Company
and the Issuer Trust, the Internal Revenue Service has challenged the
deductibility for United States federal income tax purposes of interest payments
on certain purported debt instruments held by entities intended to be taxable as
partnerships for United States federal income tax purposes, where those
entities, in turn, issued preferred securities to investors. Although the
overall structure of the financing arrangement involved in that case is somewhat
similar to the financing structure for the Junior Subordinated Debentures and
the Issuer Trust, the relevant facts in that case appear to differ significantly
from those relating to the Junior Subordinated Debentures and the Issuer Trust.
Whether the Internal Revenue Service would attempt to challenge the
deductibility of interest on the Junior Subordinated Debentures cannot be
predicted. The Company, based on the advice of counsel, intends to take the
position that interest payments on the Junior Subordinated Debentures will be
deductible by the Company for United States federal income tax purposes. See
"Certain Federal Income Tax Consequences -- Classification of the Junior
Subordinated Debentures." Adverse developments relating to the deductibility of
interest, whether arising in connection with the case currently pending in the
United States Tax Court or not, could give rise to a Tax Event.
"Investment Company Event" means the receipt by the Issuer Trust of an
opinion of counsel to the Company experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation or a
written change (including any announced prospective 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 Issuer Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940, as amended
(the "Investment Company Act"), which change or prospective change becomes
effective or would become effective, as the case may be, on or after the date of
the issuance of the Capital Securities.
A "Capital Treatment Event" means the reasonable determination by the
Company that, as a result of the occurrence of any amendment to, or change
(including any announced prospective change) in, the laws (or any rules or
regulations thereunder) of the United States or any political subdivision
thereof or therein, or as a result of any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws
or regulations, which amendment or change is effective or such pronouncement,
action or decision is announced on or after the date of issuance of the Capital
Securities, there is more than an insubstantial risk that the Company will not
be entitled to treat an amount equal to the Liquidation Amount of the Capital
Securities as "Tier 1 Capital" (or the then equivalent thereof) for purposes of
the risk-based capital adequacy guidelines of the Federal Reserve, as then in
effect and applicable to the Company.
Possible Tax Law Changes
In both 1996 and 1997, the Clinton Administration proposed to amend the
Internal Revenue Code of 1986, as amended (the "Code"), to deny deductions of
interest on instruments with features similar to those of the Junior
Subordinated Debentures when issued under arrangements similar to the Issuer
Trust. That proposal was not passed by, and is not currently pending before,
Congress. There can be no assurance, however, that future legislative proposals,
future regulations or official administrative pronouncements or future judicial
decisions will not affect the ability of the Company to deduct interest on the
Junior Subordinated Debentures. Such a change could give rise to a Tax Event,
which may permit the Company, upon approval of the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal Reserve,
to cause a redemption of the Capital Securities, as described more fully under
"Description of the New Capital Securities -- Redemption."
Exchange of Capital Securities for Junior Subordinated Debentures
The holders of all the outstanding Common Securities have the right at any
time to dissolve the Issuer Trust and, after satisfaction of liabilities to
creditors of the Issuer Trust as provided by applicable law, cause the Junior
Subordinated Debentures to be distributed to the holders of the Capital
Securities and Common Securities in liquidation of the Issuer Trust. The ability
of the Company to dissolve the Issuer Trust may be subject to prior regulatory
approval of the Federal Reserve, if then required under applicable Federal
Reserve capital guidelines or policies. See "Description of the New Capital
Securities -- Liquidation Distribution Upon Dissolution."
Under current United States federal income tax law and interpretations and
assuming, as expected, that the Issuer Trust will be taxable as a grantor trust,
a distribution of the Junior Subordinated Debentures upon a liquidation of the
Issuer Trust will not be a taxable event to holders of the Capital Securities.
However, if a Tax Event were to occur that would cause the Issuer Trust to be
subject to United States federal income tax with respect to income received or
accrued on the Junior Subordinated Debentures, a distribution of the Junior
Subordinated Debentures by the Issuer Trust would be a taxable event to
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the Issuer Trust and the holders of the Capital Securities. See "Certain Federal
Income Tax Consequences -- Distribution of Junior Subordinated Debentures to
Holders of Capital Securities."
Rights Under the Guarantee
The terms of the Guarantee will be those set forth in the Guarantee and
those made part of the Guarantee by the Trust Indenture Act of 1939 (the "Trust
Indenture Act"). Bankers Trust Company will act as the trustee under the
Guarantee (the "Guarantee Trustee") and will hold the Guarantee for the benefit
of the holders of the Capital Securities. Bankers Trust Company will also act as
Debenture Trustee for the Junior Subordinated Debentures and as Property Trustee
under the Trust Agreement. Bankers Trust (Delaware) will act as Delaware Trustee
under the Trust Agreement. The Guarantee guarantees to the holders of the
Capital Securities the following payments, to the extent not paid by or on
behalf of the Issuer Trust: (i) any accumulated and unpaid Distributions
required to be paid on the Capital Securities, to the extent that the Issuer
Trust has funds on hand available therefor at such time; (ii) the Redemption
Price (as defined in "Description of the New Capital Securities -- Redemption")
with respect to any Capital Securities called for redemption, to the extent that
the Issuer Trust has funds on hand available therefor at such time; and (iii)
upon a voluntary or involuntary dissolution of the Issuer Trust (unless the
Junior Subordinated Debentures are distributed to holders of the Capital
Securities), the lesser of (a) the aggregate of the Liquidation Amount and all
accumulated and unpaid Distributions to the date of payment, to the extent that
the Issuer Trust has funds on hand available therefor at such time, and (b) the
amount of assets of the Issuer Trust remaining available for distribution to
holders of the Capital Securities on liquidation of the Issuer Trust. The
Guarantee is subordinated as described under " -- Ranking of Subordinated
Obligations Under the Guarantee and the Junior Subordinated Debentures" and
"Description of the Guarantee -- Status of the Guarantee." The holders of not
less than a majority in aggregate Liquidation Amount of the outstanding Capital
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of the
Guarantee or to direct the exercise of any trust power conferred upon the
Guarantee Trustee under the Guarantee. Any holder of the Capital Securities may
institute a legal proceeding directly against the Company to enforce its rights
under the Guarantee without first instituting a legal proceeding against the
Issuer Trust, the Guarantee Trustee or any other person or entity.
If the Company were to default on its obligation to pay amounts payable
under the Junior Subordinated Debentures, the Issuer Trust may lack funds for
the payment of Distributions or amounts payable on redemption of the Capital
Securities or otherwise, and, in such event, holders of the Capital Securities
would not be able to rely upon the Guarantee for payment of such amounts.
Instead, if a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay any amounts payable
in respect of the Junior Subordinated Debentures on the payment date on which
such payment is due and payable, then a holder of Capital Securities may
institute a legal proceeding directly against the Company for enforcement of
payment to such holder of any amounts payable in respect of such Junior
Subordinated Debentures having a principal amount equal to the aggregate
Liquidation Amount of the Capital Securities of such holder (a "Direct Action").
In connection with such Direct Action, the Company will have a right of set-off
under the Junior Subordinated Indenture to the extent of any payment made by the
Company to such holder of Capital Securities in the Direct Action. Except as
described herein, holders of Capital Securities will not be able to exercise
directly any other remedy available to the holders of the Junior Subordinated
Debentures or assert directly any other rights in respect of the Junior
Subordinated Debentures. See "Description of the New Junior Subordinated
Debentures -- Enforcement of Certain Rights by Holders of Capital Securities," "
- -- Debenture Events of Default" and "Description of the Guarantee." The Trust
Agreement provides that each holder of Capital Securities by acceptance thereof
agrees to the provisions of the Guarantee and the Junior Subordinated Indenture.
Limited Voting Rights
Holders of Capital Securities will have limited voting rights relating
generally to the modification of the Capital Securities and the Guarantee and
the exercise of the Issuer Trust's rights as holder of Junior Subordinated
Debentures. Holders of Capital Securities will not be entitled to appoint,
remove or replace the Property Trustee or the Delaware Trustee except upon the
occurrence of certain events specified in the Trust Agreement and described
herein. The Property Trustee and the holders of all the Common Securities may,
subject to certain conditions, amend the Trust Agreement without the consent of
holders of Capital Securities to cure any ambiguity or make other provisions not
inconsistent with the Trust Agreement or to ensure that the Issuer Trust (i)
will not be taxable other than 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. See "Description of the New Capital
Securities -- Voting Rights; Amendment of Trust Agreement" and " -- Removal of
Issuer Trustees; Appointment of Successors."
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Market Prices
There can be no assurance as to the market prices for Capital Securities,
or the market prices for Junior Subordinated Debentures that may be distributed
in exchange for Capital Securities if a liquidation of the Issuer Trust occurs.
Accordingly, the Capital Securities or the Junior Subordinated Debentures that a
holder of Capital Securities may receive on liquidation of the Issuer Trust may
trade at a discount to the price that the investor paid to purchase the Old
Capital Securities in exchange for which the New Capital Securities are being
offered. Because holders of Capital Securities may receive Junior Subordinated
Debentures on termination of the Issuer Trust, holders who elect to exchange
their Old Capital Securities for New Capital Securities are also making an
investment decision with regard to the Junior Subordinated Debentures and should
carefully review all the information regarding the Junior Subordinated
Debentures contained herein. See "Description of the New Junior Subordinated
Debentures."
Absence of Public Market
The Old Capital Securities were issued to, and the Company believes they
are currently owned by, a relatively small number of beneficial owners. The Old
Capital Securities have not been registered under the Securities Act and will be
subject to restrictions on transferability to the extent that they are not
exchanged for the New Capital Securities. Although the New Capital Securities
will generally be permitted to be resold or otherwise transferred by the holders
thereof (who are not affiliates of the Company or the Issuer Trust) without
compliance with the registration requirements under the Securities Act, they
will constitute a new issue of securities with no established trading market.
Also, Capital Securities may be transferred by the holders thereof only in
blocks having a Liquidation Amount of not less than $100,000 (100 Capital
Securities). The Company and the Issuer Trust have been advised by the Initial
Purchaser that the Initial Purchaser presently intends to make a market in the
New Capital Securities. However, the Initial Purchaser is not obligated to do so
and any market-making activity with respect to the New Capital Securities may be
discontinued at any time without notice. In addition, such market-making
activity will be subject to the limits imposed by the Securities Act and the
Exchange Act and may be limited during the Exchange Offer. Accordingly, no
assurance can be given that an active public or other market will develop for
the New Capital Securities or the Old Capital Securities or as to the liquidity
of the trading market for the New Capital Securities or the Old Capital
Securities. If an active public market does not develop, the market price and
liquidity of the New Capital Securities may be adversely affected.
If a public trading market for the New Capital Securities develops, future
trading prices of such securities will depend on many factors, including, among
other things, prevailing interest rates, the Company's results of operations and
the market for similar securities. Depending on prevailing interest rates, the
market for similar securities and other factors, including the financial
condition of the Company, the New Capital Securities may trade at a discount.
Notwithstanding the registration of the New Capital Securities in the
Exchange Offer, holders who are "affiliates" (as defined under Rule 405 of the
Securities Act) of the Company or the Issuer Trust may publicly offer for sale
or resell the New Capital Securities only in compliance with the provisions of
Rule 144 under the Securities Act.
Each broker-dealer that receives New Capital Securities for its own account
in exchange for Old Capital Securities, where such Old Capital Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such New Capital Securities. See "Plan of
Distribution."
Growth
The Company has grown and may seek to grow by acquiring other financial
institutions and branches. However, competition for acquisitions in the
Company's market area is highly competitive. Moreover, any acquisitions will be
subject to regulatory approval and there can be no assurance that the Company
will obtain such approvals. The Company may not be as successful in the future
as it has been in the past in identifying further acquisition candidates,
integrating acquired institutions or preventing deposit erosion at acquired
institutions or branches. Furthermore, the Company's ability to grow through
acquisitions will depend on its maintaining sufficient regulatory capital levels
and on economic conditions.
Competition
The banking business is highly competitive. In their primary market areas,
the Banks compete with other commercial banks, savings and loan associations,
credit unions, finance companies, mutual funds, insurance companies, and
brokerage and investment banking firms operating locally and elsewhere. Certain
of the Banks' primary competitors have substantially
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greater resources and lending limits than the Banks and may offer certain
services the Banks do not provide at this time. The profitability of the Company
depends upon the Banks' ability to continue to compete in their primary market
areas.
Developments in Technology
The market for financial services, including banking services, is
increasingly affected by advances in technology, including developments in
telecommunications, data processing, computers, automation, Internet-based
banking, telebanking, debit cards and so-called "smart" cards. The ability of
the Company to compete successfully in its markets may depend on the extent to
which it is able to exploit such technological changes. However, there can be no
assurance that the development of these or any other new technologies, or the
Company's success or failure in anticipating or responding to such developments,
will materially affect the Company's business, financial condition and operating
results.
FIRST CITIZENS BANCSHARES, INC.
The Company is a registered bank holding company, chartered under the laws
of Delaware, and headquartered in Raleigh, North Carolina. The Company operates
through, and its principal assets are its investments in, its three wholly-owned
banking subsidiaries, the largest of which is First-Citizens Bank & Trust
Company, Raleigh, North Carolina ("FCB/ NC"). The Company's other two banking
subsidiaries are First-Citizens Bank & Trust Company, White Sulphur Springs,
West Virginia ("FCB/WV"), and Atlantic States Bank, Raleigh, North Carolina
("ASB"). FCB/NC, FCB/WV, and ASB (collectively referred to herein as the
"Banks") provide a wide variety of retail and commercial banking products and
services to individuals and small- to medium-sized businesses located in the
communities they serve. At March 31, 1998, the Company had total consolidated
assets of approximately $9.3 billion, total consolidated deposits of
approximately $7.9 billion, and total consolidated shareholders' equity of
approximately $615.0 million.
FCB/NC is a North Carolina-chartered bank that currently maintains 349
banking offices in 209 communities in North Carolina and Virginia. FCB/WV is a
West Virginia-chartered bank that currently maintains four banking offices in
four communities in West Virginia. ASB is a federally-chartered savings bank
based in Raleigh, North Carolina, that currently maintains eleven branch offices
located in the vicinity of Atlanta, Georgia.
Management of the Company is led by members of the Holding family, which
collectively controls 43.0% of the Class A, and 68.8% of the Class B (with a
16-to-1 voting preference over the shares of Class A), common stock of the
Company. As a result, the Company has been managed from a long-term perspective
with primary emphasis being placed on balance sheet liquidity, loan quality, and
earnings stability. Consistent with its management philosophy, the Company has
emphasized a low-risk loan portfolio derived from its local markets. At March
31, 1998, the Company's loan-to-deposit ratio was 70.65%, and its non-performing
assets were $16.3 million, or 0.29% of gross loans and other real estate. Net
charge-offs for the three months ended March 31, 1998, were 0.21% of average
loans. The allowance for loan losses at March 31, 1998, was 1.55% of gross loans
and 581.1% of non-performing loans.
The Company's strategy includes continuing to: (i) provide
community-oriented banking services with a focus on offering a complete array of
financial services for small- and medium-sized businesses and to individuals
within the communities in which it operates; (ii) increase its loan to deposit
ratio while maintaining above-average credit quality measurements; and (iii)
make the necessary investments in technology to remain competitive with the
larger banking organizations in its markets from a product delivery and customer
service standpoint. Management believes that as its largest super-regional
competitors continue to focus on larger dollar transactions and less personal
forms of customer service, and as smaller banking organizations become less
capable of providing the advanced levels of customer service required in today's
banking market, the Company will have significant opportunities to continue to
expand its franchise and further penetrate its targeted markets.
The Company's principal executive offices are located at 3128 Smoketree
Court, Raleigh, North Carolina 27604, and its telephone number is (919)
716-7000.
For additional information regarding the Company and its financial
condition and results of operations, see "Available Information," "Incorporation
of Certain Documents by Reference" and "Selected Consolidated Financial Data and
Other Information."
NEITHER THE CAPITAL SECURITIES NOR THE JUNIOR SUBORDINATED DEBENTURES ARE
OBLIGATIONS OF OR GUARANTEED BY THE BANKS.
22
<PAGE>
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following unaudited table presents the consolidated ratios of earnings
to fixed charges of the Company. The consolidated ratio of earnings to fixed
charges has been computed by dividing income before income taxes and fixed
charges by fixed charges. Fixed charges represent all interest expense (ratios
are presented both excluding and including interest on deposits). Interest
expense (other than on deposits) includes interest on borrowed funds, federal
funds purchased and securities sold under agreements to repurchase, and other
funds borrowed.
<TABLE>
<CAPTION>
Three months ended
March 31, Year ended December 31,
----------------------- ---------------------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
---------- ---------- ---------- ---------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings to fixed charges:
Excluding interest on deposits 4.24 x 7.01x 5.54x 6.86x 6.01x 8.18x 12.11x
Including interest on deposits 1.34 1.42 1.41 1.41 1.39 1.53 1.61
</TABLE>
SELECTED CONSOLIDATED FINANCIAL DATA AND OTHER INFORMATION
Presented below is selected consolidated financial information for the Company
for the periods specified. The consolidated financial information is not
necessarily indicative of the results for any future period and is qualified in
its entirety by, and should be read in conjunction with, the detailed
information contained in the Company's consolidated financial statements,
including footnotes thereto, incorporated herein by reference and the other
information contained in its reports filed with the Commission under the
Exchange Act. See "Available Information" and "Incorporation of Certain
Documents by Reference."
<TABLE>
<CAPTION>
As of and for the
three months ended
March 31,
-------------------------------
1998 1997
--------------- ---------------
(Unaudited)
(Dollars in thousands, except
for per share data)
<S> <C> <C>
Selected balance sheet
data:
Loans $ 5,562,831 $ 4,955,135
Securities held to
maturity 2,498,079 2,063,526
Securities available for
sale 28,287 25,239
Total assets 9,252,029 7,975,617
Deposits 7,873,484 6,911,806
Long term obligations 160,219 6,827
Shareholders' equity 615,036 629,265
Selected results of
operations:
Net interest income $ 78,023 $ 74,733
Provision for loan losses 4,395 1,567
Noninterest income 31,895 23,414
Noninterest expense 81,019 70,584
Income taxes 8,844 9,404
Net income 15,660 16,592
Per share:
Net income (1) 1.39 1.46
Book value 57.87 55.22
Cash dividends 0.250 0.250
Selected ratios:
Return on average
assets (2) 0.71% 0.85%
Return on average
equity (2) 10.45 10.85
Shareholders' equity to
total assets 6.65 7.89
Nonperforming assets to
total gross loans and
other real estate owned 0.29% 0.32%
Net charge-offs to
average loans (2) 0.21 0.13
Total allowance for
loan losses to total
nonperforming assets 527.55 510.23
<CAPTION>
As of and for the year ended December 31,
-------------------------------------------------------------------------------
1997 1996 1995 1994 1993
--------------- --------------- --------------- --------------- ---------------
(Dollars in thousands, except for per share data)
<S> <C> <C> <C> <C> <C>
Selected balance sheet
data:
Loans $ 5,445,772 $ 4,930,508 $ 4,580,719 $ 4,148,133 $ 3,584,991
Securities held to
maturity 2,456,722 2,138,831 1,983,148 1,458,969 1,814,787
Securities available for
sale 26,572 22,405 -- -- --
Total assets 8,951,109 8,055,572 7,383,950 6,333,324 6,101,016
Deposits 7,579,567 6,954,028 6,388,082 5,517,589 5,358,187
Long term obligations 10,856 6,922 22,957 34,542 60,326
Shareholders' equity 601,640 615,507 520,837 449,411 389,050
Selected results of
operations:
Net interest income $ 304,263 $ 285,945 $ 246,445 $ 227,879 $ 226,947
Provision for loan losses 8,726 8,907 5,364 2,786 15,245
Noninterest income 115,307 103,304 92,128 83,325 85,737
Noninterest expense 300,794 278,668 245,880 230,582 213,213
Income taxes 39,492 36,207 30,423 26,867 28,641
Net income 70,558 65,467 56,906 50,969 55,585
Per share:
Net income (1) 6.22 5.77 5.37 5.13 5.73
Book value 56.61 53.94 48.60 44.11 39.84
Cash dividends 1.000 0.925 0.825 0.725 0.625
Selected ratios:
Return on average
assets (2) 0.85% 0.85% 0.83% 0.84% 1.00%
Return on average
equity (2) 11.04 11.35 11.66 12.22 15.32
Shareholders' equity to
total assets 6.72 7.64 7.05 7.10 6.38
Nonperforming assets to
total gross loans and
other real estate owned 0.26% 0.28% 0.34% 0.65% 1.39%
Net charge-offs to
average loans (2) 0.12 0.15 0.05 0.05 0.35
Total allowance for
loan losses to total
nonperforming assets 596.48 582.96 510.97 266.78 139.61
</TABLE>
- ---------
(1) In December 1997, the Company adopted SFAS No. 128, "Earnings Per Share".
Adoption of this new accounting standard had no impact on the Company's
net income per share computations because the Company has no dilutive
securities.
(2) Annualized for the three months ended March 31, 1998 and 1997.
23
<PAGE>
FCB/NC CAPITAL TRUST I
The Issuer Trust is a statutory business trust created under Delaware law
on February 27, 1998, pursuant to the filing of a certificate of trust with the
Delaware Secretary of State. The Issuer Trust is governed by the Trust Agreement
among the Company as Depositor, Bankers Trust (Delaware) as Delaware Trustee,
Bankers Trust Company as Property Trustee, the Administrators named therein, and
the holders, from time to time, of undivided beneficial interests in the assets
of the Issuer Trust. The Company, as holder of the Common Securities, has
appointed two individuals who are officers of the Company to serve as the
Administrators of the Issuer Trust. See "Description of the New Capital
Securities -- Miscellaneous." The Issuer Trust exists for the exclusive purposes
of (i) issuing and selling the Trust Securities, (ii) using the proceeds from
the sale of the Trust Securities to acquire the Junior Subordinated Debentures,
(iii) effecting the Exchange Offer by exchanging up to $150,000,000 aggregate
Liquidation Amount of the New Capital Securities for a like amount of the Old
Capital Securities, and (iv) engaging in only those other activities necessary,
convenient or incidental thereto (such as registering the transfer of the Trust
Securities). Accordingly, the Junior Subordinated Debentures will be the sole
assets of the Issuer Trust, and payments under the Junior Subordinated
Debentures will be the sole source of revenue of the Issuer Trust.
All the Common Securities of the Issuer Trust are owned by the Company. The
Common Securities rank pari passu, and payments will be made thereon pro rata,
with the Capital Securities, except that upon the occurrence and during the
continuation of a Debenture Event of Default arising as a result of any failure
by the Company to pay any amounts in respect of the Junior Subordinated
Debentures when due, the rights of the holders of the Common Securities to
payment in respect of Distributions and payments upon liquidation, redemption or
otherwise will be subordinated to the rights of the holders of the Capital
Securities. See "Description of the New Capital Securities -- Subordination of
Common Securities." The Company acquired Common Securities in an aggregate
Liquidation Amount equal to 3% of the total capital of the Issuer Trust. The
Issuer Trust has a term of 31 years, but may dissolve earlier as provided in the
Trust Agreement. The address of the Delaware Trustee is Bankers Trust
(Delaware), E.A. Delle Donne Corporate Center, Montgomery Building, 1011 Centre
Road, Suite 200, Wilmington, Delaware 19805-1266, telephone number (302)
636-3301. The address of the Property Trustee, the Guarantee Trustee and the
Debenture Trustee is Bankers Trust Company, Four Albany Street, 4th Floor, New
York, New York 10006, telephone number (212) 250-2500.
ACCOUNTING TREATMENT
For financial reporting purposes, the Issuer Trust will be treated as a
subsidiary of the Company and, accordingly, the accounts of the Issuer Trust
will be included in the consolidated financial statements of the Company. The
Capital Securities will be included in the consolidated balance sheets of the
Company as long-term obligations, and appropriate disclosures about the Capital
Securities, the Guarantee and the New Junior Subordinated Debentures will be
included in the notes to the consolidated financial statements of the Company.
For financial reporting purposes, Distributions on the Capital Securities will
be recorded as interest expense in the consolidated statements of income of the
Company.
THE EXCHANGE OFFER
Purpose and Effect of the Exchange Offer
In connection with the sale of the Old Capital Securities, the Company and
the Issuer Trust entered into the Registration Rights Agreement with the Initial
Purchaser pursuant to which the Company and the Issuer Trust agreed, among other
things, to file and to use their best efforts to cause to become effective with
the Commission a registration statement (the "Exchange Registration Statement")
with respect to the exchange of the Old Capital Securities for capital
securities which have been registered under the Securities Act and which have
terms identical in all material respects to the terms of the Old Capital
Securities. A copy of the Registration Rights Agreement has been filed as an
Exhibit to the Registration Statement of which this Prospectus is a part.
The Exchange Offer is being made to satisfy the contractual obligations of
the Company and the Issuer Trust under the Registration Rights Agreement. The
form and terms of the New Capital Securities are the same as the form and terms
of the Old Capital Securities, except that the New Capital Securities have been
registered under the Securities Act and, therefore, will not be subject to
certain restrictions on transfer applicable to the Old Capital Securities and,
subject to certain limited exceptions specified in the Registration Rights
Agreement, will not provide for any increase in the Distribution rate thereon.
In this regard, under certain circumstances set forth in the Registration
Rights Agreement, additional interest will accrue on the Capital Securities in
addition to the stated interest thereon. The Registration Rights Agreement
provides that (i) the Company and the Issuer Trust shall use their respective
best efforts to cause the Exchange Registration Statement to be
24
<PAGE>
declared effective by the Commission on or prior to 180 days after the date of
original issuance of the Trust Securities, and to keep the Exchange Registration
Statement effective for not less than 30 business days (or longer if required by
applicable law) after the date notice of the Exchange Offer is made to the
holders, (ii) unless the Exchange Offer will not be permitted by applicable law
or Commission policy, the Issuer Trust will commence the Exchange Offer and use
its best efforts to consummate the Exchange Offer within 30 business days after
the effective date of the Exchange Registration Statement, and (iii) if
obligated to file the "Shelf Registration Statement" (as defined in the
Registration Rights Agreement), the Company and Issuer Trust will use their best
efforts to file the Shelf Registration Statement with the Commission as promptly
as practicable, but, in any event, within 45 days after such filing obligation
arises, and to cause the Shelf Registration Statement to be declared effective
by the Commission on or prior to 180 days after such obligation arises.
If (i) the Company and the Issuer Trust fail to file, if appropriate, the
Shelf Registration Statement on or before the dates specified for such filing,
(ii) the Exchange Registration Statement or the Shelf Registration Statement, if
applicable, is not declared effective by the Commission on or prior to the date
specified for such effectiveness (the "Effectiveness Target Date"), (iii) the
Company and Issuer Trust fail to consummate the Exchange Offer within 30
business days of the Effectiveness Target Date with respect to the Exchange
Registration Statement, or (iv) the Exchange Registration Statement or the Shelf
Registration Statement, if applicable, is declared effective but thereafter
ceases to be effective or usable in connection with resales of "Transfer
Restricted Securities" (as defined below) during the period specified in the
Registration Rights Agreement (each such event referred to in clauses (i)
through (iv) above, a "Registration Default"), then liquidated damages shall
accrue on the principal amount ("Additional Interest") of the Old Junior
Subordinated Debentures and, if the Exchange Offer has been consummated, the New
Junior Subordinated Debentures, and additional Distributions shall accumulate on
the Liquidation Amount ("Additional Distributions") of the Old Capital
Securities and, if the Exchange Offer has been consummated, the New Capital
Securities, immediately following the occurrence of such Registration Default,
each at a rate of 0.25% per annum. Notwithstanding the foregoing, neither the
Additional Interest on the Junior Subordinated Debentures nor the Additional
Distribution rate on the Liquidation Amount of the Capital Securities may exceed
in the aggregate 0.25% per annum. Such Additional Interest and Additional
Distributions shall cease to accrue and accumulate upon the curing of the
respective Registration Default.
For purposes of the preceding paragraph, "Transfer Restricted Security"
means each Old Capital Security, the Old Guarantee or Old Junior Subordinated
Debenture until (i) the date on which such Old Capital Security, the Old
Guarantee or Old Junior Subordinated Debenture has been exchanged for a New
Capital Security, the Guarantee or New Junior Subordinated Debenture in the
Exchange Offer and are thereafter freely tradable by the holder thereof (other
than an affiliate of the Company), (ii) such Old Capital Security, Old Guarantee
or Old Junior Subordinated Debenture, as the case may be, shall have ceased to
be outstanding, (iii) the date on which such Old Capital Security, Old Guarantee
or Old Junior Subordinated Debenture has been effectively registered under the
Securities Act and disposed of in accordance with the Exchange Registration
Statement or the Shelf Registration Statement, if applicable, or (iv) the date
on which such Old Capital Security, Old Guarantee or Old Junior Subordinated
Debenture is distributed to the public pursuant to Rule 144 (or any similar
provision then in force, but not Rule 144A) under the Securities Act.
The Exchange Offer is not being made to, nor will the Company or the Issuer
Trust accept tenders for exchange from, holders of Old Capital Securities in any
jurisdiction in which the Exchange Offer or the acceptance thereof would not be
in compliance with the securities or blue sky laws of such jurisdiction.
Unless the context requires otherwise, the term "holder" with respect to
the Exchange Offer means any person in whose name the Old Capital Securities are
registered on the books of the Issuer Trust or any other person who has obtained
a properly completed bond power from the registered holder, or any person whose
Old Capital Securities are held of record by The Depository Trust Company
("DTC") who desires to deliver such Old Capital Securities by book-entry
transfer at DTC. Pursuant to the Exchange Offer, the Company will exchange, as
soon as practicable after the date hereof, the Old Guarantee for the Guarantee
and up to $150,000,000 aggregate principal amount of the Old Junior Subordinated
Debentures for a like aggregate principal amount of the New Junior Subordinated
Debentures. The Guarantee and the New Junior Subordinated Debentures have also
been registered under the Securities Act.
Terms of the Exchange
The Company and the Issuer Trust hereby offer, upon the terms and subject
to the conditions set forth in this Prospectus and in the accompanying Letter of
Transmittal, to exchange up to $150,000,000 aggregate Liquidation Amount of New
Capital Securities for a like aggregate Liquidation Amount of Old Capital
Securities properly tendered on or prior to the Expiration Date and not properly
withdrawn in accordance with the procedures described below. The Issuer Trust
will issue, promptly after the Expiration Date, an aggregate Liquidation Amount
of up to $150,000,000 of New Capital Securities in
25
<PAGE>
exchange for a like Liquidation Amount of outstanding Old Capital Securities
tendered and accepted in connection with the Exchange Offer. Holders may tender
their Old Capital Securities in whole or in part in a Liquidation Amount of not
less than $100,000 or any integral multiple of $1,000 in excess thereof.
The Exchange Offer is not conditioned upon any minimum Liquidation Amount
of Old Capital Securities being tendered. As of the date of this Prospectus,
$150,000,000 aggregate Liquidation Amount of the Old Capital Securities is
outstanding. Holders of Old Capital Securities do not have any appraisal or
dissenters' rights in connection with the Exchange Offer. Old Capital Securities
which are not tendered, or are tendered but not accepted, in connection with the
Exchange Offer will remain outstanding and be entitled to the benefits of the
Trust Agreement, but will not be entitled to any further registration rights
under the Registration Rights Agreement, except under limited circumstances. See
"Risk Factors -- Consequences of a Failure to Exchange Old Capital Securities."
If any tendered Old Capital Securities are not accepted for exchange
because of an invalid tender, the occurrence of certain other events set forth
herein or otherwise, certificates for any such unaccepted Old Capital Securities
will be returned, without expense, to the tendering holder thereof promptly
after the Expiration Date.
Holders who tender Old Capital Securities in connection with the Exchange
Offer will not be required to pay brokerage commissions or fees or, subject to
the instructions in the Letter of Transmittal, transfer taxes with respect to
the exchange of Old Capital Securities in connection with the Exchange Offer.
The Company will pay all charges and expenses, other than certain applicable
taxes described below, in connection with the Exchange Offer. See " -- Fees and
Expenses."
NEITHER THE BOARD OF DIRECTORS OF THE COMPANY, THE ADMINISTRATORS OR
TRUSTEES OF THE ISSUER TRUST, THE EXCHANGE AGENT, MAKE ANY RECOMMENDATION TO
HOLDERS OF OLD CAPITAL SECURITIES AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING ALL OR ANY PORTION OF THEIR OLD CAPITAL SECURITIES PURSUANT TO THE
EXCHANGE OFFER. IN ADDITION, NO ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH
RECOMMENDATION. HOLDERS OF OLD CAPITAL SECURITIES MUST MAKE THEIR OWN DECISION
WHETHER TO TENDER PURSUANT TO THE EXCHANGE OFFER AND, IF SO, THE AGGREGATE
AMOUNT OF OLD CAPITAL SECURITIES TO TENDER, AFTER READING THIS PROSPECTUS AND
THE LETTER OF TRANSMITTAL AND CONSULTING WITH THEIR ADVISERS, IF ANY, BASED ON
THEIR OWN FINANCIAL POSITION AND REQUIREMENTS.
Expiration Date; Extensions; Amendments
The Expiration Date will be 5:00 p.m., New York City time, on ,
1998, unless the Exchange Offer is extended by the Company and the Issuer Trust
(in which case the term "Expiration Date" shall mean the latest date and time to
which the Exchange Offer is extended). The Company and the Issuer Trust
expressly reserve the right in their sole and absolute discretion, subject to
applicable law, at any time and from time to time, (i) to delay the acceptance
of the Old Capital Securities for exchange, (ii) to terminate the Exchange Offer
(whether or not any Old Capital Securities have theretofore been accepted for
exchange) if the Company and the Issuer Trust determine, in their sole and
absolute discretion, that any of the events or conditions referred to under " --
Conditions to the Exchange Offer" have occurred or exist or have not been
satisfied, (iii) to extend the Expiration Date of the Exchange Offer and retain
all Old Capital Securities tendered pursuant to the Exchange Offer, subject,
however, to the right of holders of Old Capital Securities to withdraw their
tendered Old Capital Securities as described under " -- Withdrawal Rights," and
(iv) to waive any condition or otherwise amend the terms of the Exchange Offer
in any respect. If the Exchange Offer is amended in a manner determined by the
Company and the Issuer Trust to constitute a material change, or if the Company
and the Issuer Trust waive a material condition of the Exchange Offer, the
Company or the Issuer Trust will promptly disclose such amendment or waiver by
means of a supplement to this Prospectus that will be distributed to the
registered holders of the Old Capital Securities, and the Company and the Issuer
Trust will extend the Exchange Offer to the extent required by Rule 14e-1 under
the Exchange Act.
Any such delay in acceptance, extension, termination or amendment will be
followed promptly by oral or written notice thereof to the Exchange Agent and by
making a public announcement thereof, and such announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date. Without limiting
the manner in which the Company or the Issuer Trust may choose to make any
public announcement and subject to applicable law, neither the Company nor the
Issuer Trust shall have any obligation to publish, advertise or otherwise
communicate any such public announcement other than by issuing a release to an
appropriate news agency.
26
<PAGE>
Acceptance for Exchange and Issuance of New Capital Securities
Upon the terms and subject to the conditions of the Exchange Offer, the
Company and the Issuer Trust will exchange, and will issue to the Exchange
Agent, New Capital Securities for Old Capital Securities validly tendered and
not withdrawn (pursuant to the withdrawal rights described below under " --
Withdrawal Rights") promptly after the Expiration Date.
In all cases, delivery of New Capital Securities in exchange for Old
Capital Securities tendered and accepted for exchange pursuant to the Exchange
Offer will be made only after timely receipt by the Exchange Agent of (i) Old
Capital Securities or a Book-Entry Confirmation (as defined below) of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC, (ii) the Letter of Transmittal (or facsimile thereof), or an Agent's
Message (as defined below), properly completed and duly executed, with any
required signature guarantees, and (iii) any other documents required by the
Letter of Transmittal.
The term "Book-Entry Confirmation" means a timely confirmation of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC.
Subject to the terms and conditions of the Exchange Offer, the Company and
the Issuer Trust will be deemed to have accepted for exchange, and thereby
exchanged, Old Capital Securities validly tendered and not withdrawn as, if and
when the Company or the Issuer Trust gives oral or written notice to the
Exchange Agent of the Company's and the Issuer Trust's acceptance of such Old
Capital Securities for exchange pursuant to the Exchange Offer. The Exchange
Agent will act as agent for the Company and the Issuer Trust for the purpose of
receiving tenders of Old Capital Securities, Letters of Transmittal, Agent's
Messages, and related documents, and as agent for tendering holders for the
purpose of receiving Old Capital Securities, Letters of Transmittal, Agent's
Messages, and related documents and transmitting New Capital Securities to
validly tendering holders. Such exchange will be made promptly after the
Expiration Date. If, for any reason whatsoever, acceptance for exchange or the
exchange of any Old Capital Securities tendered pursuant to the Exchange Offer
is delayed (whether before or after the Company's and the Issuer Trust's
acceptance for exchange of Old Capital Securities) or the Company or the Issuer
Trust extends the Exchange Offer or is unable to accept for exchange or exchange
Old Capital Securities tendered pursuant to the Exchange Offer, then, without
prejudice to the Company's or the Issuer Trust's rights set forth herein, the
Exchange Agent may, nevertheless, on behalf of the Company and the Issuer Trust
and subject to Rule 14e-1(c) under the Exchange Act, retain tendered Old Capital
Securities and such Old Capital Securities may not be withdrawn except to the
extent tendering holders are entitled to withdrawal rights as described below
under " -- Withdrawal Rights."
Pursuant to the Letter of Transmittal, a holder of Old Capital Securities
will warrant and agree in the Letter of Transmittal that it has full power and
authority to tender, exchange, sell, assign and transfer Old Capital Securities,
that the Issuer Trust will acquire good, marketable and unencumbered title to
the tendered Old Capital Securities, free and clear of all liens, restrictions,
charges and encumbrances, and that the Old Capital Securities tendered for
exchange are not subject to any adverse claims or proxies. The holder also will
warrant and agree that it will, upon request, execute and deliver any additional
documents deemed by the Company, the Issuer Trust or the Exchange Agent to be
necessary or desirable to complete the exchange, sale, assignment, and transfer
of the Old Capital Securities tendered pursuant to the Exchange Offer.
Procedure for Tendering Old Capital Securities
Valid Tender. Except as set forth below, in order for Old Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), or an
Agent's Message (as defined below), with any required signature guarantees and
any other required documents, must be received by the Exchange Agent, on or
prior to the Expiration Date, at its address set forth below under " -- Exchange
Agent," and either (i) tendered Old Capital Securities must be received by the
Exchange Agent on or prior to the Expiration Date, or (ii) such Old Capital
Securities must be tendered pursuant to the procedures for book-entry transfer
set forth below and a Book-Entry Confirmation must be received by the Exchange
Agent, in each case on or prior to the Expiration Date, or (iii) the guaranteed
delivery procedures set forth below must be complied with.
If less than all of a tendering holder's Old Capital Securities are
tendered, the tendering holder should fill in the amount of Old Capital
Securities being tendered in the appropriate box on the Letter of Transmittal.
The entire amount of Old Capital Securities delivered to the Exchange Agent will
be deemed to have been tendered unless otherwise indicated.
THE METHOD OF DELIVERY OF THE OLD CAPITAL SECURITIES, INCLUDING THE
CERTIFICATES EVIDENCING THE SAME, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS, IS AT THE OPTION AND SOLE RISK OF THE TENDERING HOLDER, AND
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT.
IF DELIVERY IS TO BE MADE
27
<PAGE>
BY MAIL, REGISTERED MAIL, RETURN RECEIPT REQUESTED, PROPERLY INSURED, OR AN
OVERNIGHT DELIVERY SERVICE, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD
BE ALLOWED TO ENSURE TIMELY DELIVERY ON OR PRIOR TO THE EXPIRATION DATE.
Book-Entry Transfer. The Company understands that the Exchange Agent has
confirmed with DTC that any financial institution that is a participant in DTC's
system may utilize DTC's Automated Tender Offer Program ("ATOP") to tender Old
Capital Securities. The Exchange Agent will establish an account with respect to
the Old Capital Securities at DTC for purposes of the Exchange Offer within two
business days after the date of this Prospectus. Any financial institution that
is a participant in DTC's book-entry transfer facility system may make a
book-entry delivery of the Old Capital Securities by causing DTC to transfer
such Old Capital Securities into the Exchange Agent's account at DTC in
accordance with DTC's procedures for transfers. However, although delivery of
Old Capital Securities may be effected through book-entry transfer into the
Exchange Agent's account at DTC, the Book-Entry Confirmation and a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), or an
Agent's Message (as defined below), with any required signature guarantees and
any other required documents, must in any case be delivered to and received by
the Exchange Agent at its address set forth below under " -- Exchange Agent" on
or prior to the Expiration Date, or the guaranteed delivery procedure set forth
below must be complied with, and the exchange of Old Capital Securities will
only be made after timely receipt thereof by the Exchange Agent.
The term "Agent's Message" means a message, transmitted by DTC and received
by the Exchange Agent and forming part of a Book-Entry Confirmation, which
states that DTC has received an express acknowledgment from a participant
tendering Old Capital Securities which are the subject of such Book-Entry
Confirmation and that such participant has received and agrees to be bound by
the terms of the Letter of Transmittal and that the Company may enforce such
agreement against such participant.
DELIVERY OF THE LETTER OF TRANSMITTAL AND OTHER REQUIRED DOCUMENTS TO DTC
IN ACCORDANCE WITH DTC'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE
AGENT.
Signature Guarantees. Certificates for the Old Capital Securities need not
be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (i) a certificate for the Old Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (ii) such registered holder completes the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" in the Letter of Transmittal.
In the case of (i) or (ii) above, such certificates for Old Capital Securities
must be duly endorsed or accompanied by a properly executed bond power, with the
endorsement or signature on the bond power and on the Letter of Transmittal
guaranteed by a firm or other entity identified in Rule 17Ad-15 under the
Exchange Act as an "eligible guarantor institution," including (as such terms
are defined therein): (i) a bank; (ii) a broker, dealer, municipal securities
broker or dealer or government securities broker or dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association or
clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association (an "Eligible Institution") unless surrendered
on behalf of such Eligible Institution. See Instruction 1 to the Letter of
Transmittal.
Delivery. The method of delivery of the Book-Entry Confirmation,
certificates representing tendered Old Capital Securities, the Letter of
Transmittal, and all other required documents is at the option and sole risk of
the tendering holder, and "delivery" will be deemed made only when actually
received by the Exchange Agent. If delivery is to be made by mail, registered
mail, return receipt requested, properly insured, or an overnight delivery
service, is recommended. In all such cases, sufficient time should be allowed to
ensure timely delivery on or before the Expiration Date.
Notwithstanding any other provision hereof, the delivery of New Capital
Securities in exchange for Old Capital Securities tendered and accepted for
exchange pursuant to the Exchange Offer will in all cases be made only after
timely receipt by the Exchange Agent of certificates representing Old Capital
Securities, or a Book-Entry Confirmation with respect to such Old Capital
Securities, and a properly completed and duly executed Letter of Transmittal (or
facsimile thereof), or an Agent's Message, together with any required signature
guarantees and any other documents required by the Letter of Transmittal.
Accordingly, the delivery of New Capital Securities might not be made to all
tendering holders at the same time, and will depend upon when Book-Entry
Confirmations with respect to Old Capital Securities or certificates
representing Old Capital Securities and other required documents are received by
the Exchange Agent.
Guaranteed Delivery. If a holder desires to tender Old Capital Securities
pursuant to the Exchange Offer and the certificates for such Old Capital
Securities are not immediately available or time will not permit all required
documents to reach the Exchange Agent on or before the Expiration Date, or the
procedures for book-entry transfer cannot be completed on a
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<PAGE>
timely basis, such Old Capital Securities may nevertheless be tendered, provided
that all of the following guaranteed delivery procedures are complied with: (i)
such tenders are made by or through an Eligible Institution; (ii) a properly
completed and duly executed Notice of Guaranteed Delivery, substantially in the
form accompanying the Letter of Transmittal, is received by the Exchange Agent,
as provided below, on or prior to the Expiration Date; and (iii) the
certificates (or a Book-Entry Confirmation) representing all tendered Old
Capital Securities, in proper form for transfer, together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), or an
Agent's Message (as defined below), with any required signature guarantees and
any other documents required by the Letter of Transmittal, are received by the
Exchange Agent within five New York Stock Exchange trading days after the date
of execution of such Notice of Guaranteed Delivery. The Notice of Guaranteed
Delivery may be delivered by hand, or transmitted by facsimile or mail, to the
Exchange Agent and must include a guarantee by an Eligible Institution in the
form set forth in such notice.
The acceptance by the Company and the Issuer Trust for exchange of Old
Capital Securities tendered pursuant to any of the procedures described above
will constitute a binding agreement among the tendering holder, the Company and
the Issuer Trust upon the terms and subject to the conditions of the Exchange
Offer.
Determination of Validity. All questions as to the form of documents,
validity, eligibility (including time of receipt) and acceptance for exchange of
any tendered Old Capital Securities will be determined by the Company and the
Issuer Trust, in their sole discretion, whose determination shall be final and
binding on all parties. The Company and the Issuer Trust reserve the absolute
right, in their sole and absolute discretion, to reject any and all tenders
determined by them not to be in proper form or the acceptance of which, or
exchange for, may, in the view of counsel to the Company and the Issuer Trust,
be unlawful. The Company and the Issuer Trust also reserve the absolute right,
subject to applicable law, to waive any of the conditions of the Exchange Offer
as set forth below under " -- Conditions to the Exchange Offer" or any condition
or irregularity in any tender of Old Capital Securities of any particular holder
whether or not similar conditions or irregularities are waived in the case of
other holders.
The Company's and the Issuer Trust's interpretation of the terms and
conditions of the Exchange Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding. No tender of Old Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. Neither the Company, the
Issuer Trust, any affiliates or assigns of the Company or the Issuer Trust, the
Exchange Agent nor any other person shall be under any duty to give any
notification of any irregularities in tenders or incur any liability for failure
to give any such notification.
If any Letter of Transmittal, endorsement, bond power, power of attorney,
or any other document required by the Letter of Transmittal is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and unless waived by the Company or
the Issuer Trust, proper evidence satisfactory to the Company or the Issuer
Trust, in their sole discretion, of such person's authority to so act must be
submitted.
A beneficial owner of Old Capital Securities that are held by or registered
in the name of a broker, dealer, commercial bank, trust company or other nominee
or custodian is urged to contact such entity promptly if such beneficial holder
wishes to participate in the Exchange Offer.
Resales of New Capital Securities
Based on interpretations by the Staff as set forth in no-action letters
issued to third parties, the Company and the Issuer Trust believe that holders
of Old Capital Securities (other than any holder that is an "affiliate" of the
Company or the Issuer Trust as defined under Rule 405 of the Securities Act) who
exchange their Old Capital Securities for New Capital Securities pursuant to the
Exchange Offer may offer such New Capital Securities for resale, resell such New
Capital Securities, and otherwise transfer such New Capital Securities, without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such New Capital Securities are acquired in the
ordinary course of such holders' business and such holders are not engaged in,
and do not intend to engage in, a distribution of such New Capital Securities
and have no arrangement or understanding with any person to participate in the
distribution of such New Capital Securities. However, the Staff has not
considered the Exchange Offer in the context of a no-action letter, and there
can be no assurance that the Staff would make a similar determination with
respect to the Exchange Offer.
Any holder of Old Capital Securities who is an "affiliate" of the Company
or the Issuer Trust or who intends to participate in the Exchange Offer for the
purpose of distributing New Capital Securities, or any broker-dealer who
purchased Old Capital Securities from the Issuer Trust to resell pursuant to
Rule 144A or any other available exemption under the Securities Act, (i) will
not be able to rely on the interpretations of the Staff set forth in the
above-mentioned interpretive
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<PAGE>
letters, (ii) will not be permitted or entitled to tender such Old Capital
Securities in the Exchange Offer, and (iii) must comply with the registration
and prospectus delivery requirements of the Securities Act, in connection with
any sale or other transfer of such Old Capital Securities unless such sale is
made pursuant to an exemption from such requirements. In addition, as described
below, if any broker-dealer holds Old Capital Securities acquired for its own
account as a result of market-making or other trading activities and exchanges
such Old Capital Securities for New Capital Securities, then such broker-dealer
must deliver a prospectus meeting the requirements of the Securities Act in
connection with any resales of such New Capital Securities.
Each holder of Old Capital Securities (other than certain specified
holders) who wishes to exchange them for New Capital Securities in the Exchange
Offer will be required to represent that: (i) it is not an "affiliate" of the
Company or the Issuer Trust; (ii) any New Capital Securities to be received by
it are being acquired in the ordinary course of its business; and (iii) it is
not engaged in, and does not intend to engage in, a distribution (within the
meaning of the Securities Act) of such New Capital Securities and has no
arrangement or understanding to participate in a distribution of New Capital
Securities. In addition, the Company and the Issuer Trust may require such
holder, as a condition to such holder's eligibility to participate in the
Exchange Offer, to furnish to the Company and the Issuer Trust (or an agent
thereof) in writing information as to the number of "beneficial owners" (within
the meaning of Rule 13d-3 under the Exchange Act) on behalf of whom such holder
holds the Old Capital Securities to be exchanged in the Exchange Offer. Each
broker-dealer that receives New Capital Securities for its own account pursuant
to the Exchange Offer must acknowledge that it will deliver a prospectus meeting
the requirements of the Securities Act in connection with any resale of such New
Capital Securities. The Letter of Transmittal states that by so acknowledging
and by delivering a prospectus, a broker-dealer will not be deemed to admit that
it is an "underwriter" within the meaning of the Securities Act. Based on the
position taken by the Staff in the interpretive letters referred to above, the
Company and the Issuer Trust believe that broker-dealers who acquired Old
Capital Securities for their own accounts as a result of market-making
activities or other trading activities may fulfill their prospectus delivery
requirements with respect to the New Capital Securities received upon exchange
of such Old Capital Securities (other than Old Capital Securities which
represent an unsold allotment from the original sale of the Old Capital
Securities) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale of
such New Capital Securities. Accordingly, this Prospectus, as it may be amended
or supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Capital
Securities received in exchange for Old Capital Securities where such Old
Capital Securities were acquired by such Participating Broker-Dealer for its own
account as a result of market-making or other trading activities. Subject to
certain provisions set forth in the Registration Rights Agreement, the Company
and the Issuer Trust have agreed to allow the Participating Broker-Dealers to
use this Prospectus, as it may be amended or supplemented from time to time, in
connection with resales of such New Capital Securities for a period of ninety
(90) days after the Expiration Date. See "Plan of Distribution." Any
Participating Broker-Dealer who is an "affiliate" of the Company or the Issuer
Trust may not rely on such interpretive letters and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction.
In that regard, each Participating Broker-Dealer who surrenders Old Capital
Securities pursuant to the Exchange Offer will be deemed to have agreed, by
execution of the Letter of Transmittal, that, upon receipt of notice from the
Company or the Issuer Trust of the occurrence of any event or the discovery of
any fact which makes any statement contained or incorporated by reference in
this Prospectus untrue in any material respect or which causes this Prospectus
to omit to state a material fact necessary in order to make the statements
contained or incorporated by reference herein, in light of the circumstances
under which they were made, not misleading, such Participating Broker-Dealer
will suspend the sale of New Capital Securities (or the Guarantee or the New
Junior Subordinated Debentures, as applicable) pursuant to this Prospectus until
the Company or the Issuer Trust has amended or supplemented this Prospectus to
correct such misstatement or omission and has furnished copies of the amended or
supplemented Prospectus to such Participating Broker-Dealer or the Company or
the Issuer Trust has given notice that the sale of the New Capital Securities
(or the Guarantee or the New Junior Subordinated Debentures, as applicable) may
be resumed, as the case may be.
Withdrawal Rights
Except as otherwise provided herein, tenders of Old Capital Securities may
be withdrawn at any time on or prior to the Expiration Date. In order for a
withdrawal to be effective, a written or facsimile transmission of such notice
of withdrawal must be timely received by the Exchange Agent at its address set
forth below under " -- Exchange Agent" on or prior to the Expiration Date. Any
such notice of withdrawal must specify the name of the person who tendered the
Old Capital Securities to be withdrawn, the aggregate Liquidation Amount of Old
Capital Securities to be withdrawn, and (if certificates for such Old Capital
Securities have been tendered) the name of the registered holder of the Old
Capital Securities as set forth on the
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<PAGE>
certificates evidencing the Old Capital Securities, if different from that of
the person who tendered such Old Capital Securities. If Old Capital Securities
have been delivered or otherwise identified to the Exchange Agent, then prior to
the physical release of such Old Capital Securities, the tendering holder must
submit the serial numbers shown on the particular Old Capital Securities to be
withdrawn and the signature on the notice of withdrawal must be guaranteed by an
Eligible Institution, except in the case of Old Capital Securities tendered for
the account of an Eligible Institution. If Old Capital Securities have been
tendered pursuant to the procedures for book-entry transfer set forth above
under " -- Procedures for Tendering Old Capital Securities," then the notice of
withdrawal must specify the name and number of the account at DTC to be credited
with the withdrawal of Old Capital Securities, in which case a notice of
withdrawal will be effective if delivered to the Exchange Agent by written or
facsimile transmission. Withdrawals of tenders of Old Capital Securities may not
be rescinded. Old Capital Securities properly withdrawn will not be deemed
validly tendered for purposes of the Exchange Offer, but may be re-tendered at
any subsequent time on or prior to the Expiration Date by following any of the
procedures described above under " -- Procedures for Tendering Old Capital
Securities."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Company and the
Issuer Trust, in their sole discretion, whose determination shall be final and
binding on all parties. Neither the Company, the Issuer Trust, any affiliates or
assigns of the Company or the Issuer Trust, the Exchange Agent nor any other
person shall be under any duty to give any notification of any irregularities in
any notice of withdrawal or incur any liability for failure to give any such
notification. Any Old Capital Securities which have been tendered but which are
properly withdrawn in accordance with the above procedures will be returned to
the holder thereof promptly after withdrawal.
Distributions on the New Capital Securities
Holders of Old Capital Securities whose Old Capital Securities are accepted
for exchange will not receive accumulated Distributions on such Old Capital
Securities for any period from and after the last Distribution Date with respect
to such Old Capital Securities prior to the original issue date of the New
Capital Securities or, if no such Distributions have been made, will not receive
any accumulated Distributions on such Old Capital Securities, and will be deemed
to have waived the right to receive any Distributions on such Old Capital
Securities accumulated from and after such Distribution Date or, if no such
Distributions have been made, from and after March 5, 1998. However, because
Distributions on the New Capital Securities will accumulate from such date, the
amount of the Distributions received by holders whose Old Capital Securities are
accepted for exchange will not be affected by the exchange.
Conditions to the Exchange Offer
Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, the Company and the Issuer Trust will not be
required to accept for exchange, or to exchange, any Old Capital Securities for
any New Capital Securities, and, as described below, may terminate the Exchange
Offer (whether or not any Old Capital Securities have theretofore been accepted
for exchange) or may waive any conditions to or amend the Exchange Offer, if
there shall occur a change in the current interpretation by the Staff that
permits the New Capital Securities issued pursuant to the Exchange Offer in
exchange for Old Capital Securities to be offered for resale, resold and
otherwise transferred by holders thereof (other than broker-dealers and any such
holder which is an "affiliate" of the Company or the Issuer Trust within the
meaning of Rule 405 under the Securities Act) without compliance with the
registration and prospectus delivery provisions of the Securities Act, provided
that such New Capital Securities are acquired in the ordinary course of such
holders' business and such holders have no arrangement or understanding with any
person to participate in the distribution of such New Capital Securities.
If the Company and the Issuer Trust determine in their sole and absolute
discretion that the foregoing event has occurred, the Company and the Issuer
Trust may, subject to applicable law, terminate the Exchange Offer (whether or
not any Old Capital Securities have theretofore been accepted for exchange) or
may waive any such condition or otherwise amend the terms of the Exchange Offer
in any respect. If such waiver or amendment constitutes a material change to the
Exchange Offer, the Company and the Issuer Trust will promptly disclose such
amendment or waiver by means of a prospectus supplement that will be distributed
to the registered holders of the Old Capital Securities, and the Company and the
Issuer Trust will extend the Exchange Offer to the extent required by Rule 14e-1
under the Exchange Act.
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<PAGE>
Exchange Agent
Bankers Trust Company has been appointed as Exchange Agent for the Exchange
Offer. Requests for additional copies of this Prospectus or the Letter of
Transmittal and any other required documents, questions or requests for
assistance should be directed to the Exchange Agent as follows:
Bankers Trust Company
Four Albany Street, 4th Floor
New York, New York 10006
Attn: Corporate Trust and Agency Group
Telephone: (212) 250-6161
Facsimile: (212) 250-6392/6961
Delivery of the Letter of Transmittal and any other required documents
should be directed to:
<TABLE>
<CAPTION>
By Mail: By Hand: By Overnight Mail:
<S> <C> <C>
BT Services Tennessee, Inc. Bankers Trust Company BT Services Tennessee, Inc.
Corporate Trust and Agency Group Corporate Trust and Agency Group Corporate Trust and Agency Group
Reorganization Unit Receipt and Delivery Window Reorganization Unit
P.O. Box 292737 123 Washington Street, 1st Floor 648 Grassmere Park Road
Nashville, TN 37229-2737 New York, NY 10006 Nashville, TN 37211
</TABLE>
For information call: (800) 735-7777
Confirm: (615) 835-3572
Facsimile: (615) 835-3701
Delivery to other than one of the above address or facsimile number will
not constitute a valid delivery to the Exchange Agent.
Fees and Expenses
The Company has agreed to pay the Exchange Agent reasonable and customary
fees for its services and will reimburse it for its reasonable out-of-pocket
expenses in connection therewith. The Company will also pay brokerage houses and
other custodians, nominees and fiduciaries the reasonable out-of-pocket expenses
incurred by them in forwarding copies of this Prospectus and related documents
to the beneficial owners of Old Capital Securities, and in handling or tendering
for their customers.
Holders who tender their Old Capital Securities for exchange will not be
obligated to pay any transfer taxes in connection therewith. If, however, New
Capital Securities are to be delivered to, or are to be issued in the name of,
any person other than the registered holder of the Old Capital Securities
tendered, or if a transfer tax is imposed for any reason other than the exchange
of Old Capital Securities in connection with the Exchange Offer, then the amount
of any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted with the Letter
of Transmittal, the amount of such transfer taxes will be billed directly to
such tendering holder.
Neither the Company nor the Issuer Trust will make any payment to brokers,
dealers or others soliciting acceptances of the Exchange Offer.
DESCRIPTION OF THE NEW CAPITAL SECURITIES
The Old Capital Securities have been issued and the New Capital Securities
will be issued pursuant to the terms of the Trust Agreement. The Property
Trustee, Bankers Trust Company, acts as trustee for the Capital Securities under
the Trust Agreement. The terms of the Capital Securities include those stated in
the Trust Agreement and those made part of the Trust Agreement by the Trust
Indenture Act and the Trust Act. The Trust Agreement will be qualified under the
Trust Indenture Act upon effectiveness of the Registration Statement with
respect to the New Capital Securities. See "The Exchange Offer." Wherever
particular defined terms of the Trust Agreement are referred to herein, such
defined terms are incorporated herein by reference. The following summary of the
material terms and provisions of the Capital Securities does not purport to be
complete and is subject to, and qualified in its entirety by reference to, the
Trust Agreement (a copy of which may be obtained from the Company or the Issuer
Trust), the Trust Act and the Trust Indenture Act.
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<PAGE>
General
The New Capital Securities will be limited to $150,000,000 aggregate
Liquidation Amount outstanding. The New Capital Securities will rank pari passu,
and payments will be made thereon pro rata, with the Common Securities except as
described under " -- Subordination of Common Securities." The New Junior
Subordinated Debentures will be registered in the name of the Issuer Trust and
held by the Property Trustee in trust for the benefit of the holders of the
Capital Securities and Common Securities. The Guarantee will be a guarantee on a
subordinated basis with respect to the New Capital Securities but will not
guarantee payment of Distributions or amounts payable on redemption or
liquidation of such New Capital Securities when the Issuer Trust does not have
funds on hand available to make such payments. See "Description of the
Guarantee."
Distributions
The New Capital Securities represent preferred undivided beneficial
interests in the assets of the Issuer Trust, and Distributions on each New
Capital Security will be payable at an annual rate equal to 8.05% on the stated
Liquidation Amount of $1,000, payable semi-annually in arrears on the 1st day of
March and September of each year (each a "Distribution Date") to the holders of
the New Capital Securities at the close of business on the February 15 or August
15 (whether or not a Business Day (as defined below)) next preceding the
relevant Distribution Date. Distributions on the New Capital Securities will be
cumulative. Distributions on the New Capital Securities will accumulate from the
last Distribution Date on the Old Capital Securities preceding the original
issue date of the New Capital Securities or, if no Distributions have been made
on the Old Capital Securities, from March 5, 1998. The first Distribution Date
for the New Capital Securities will be March 1, 1999. The amount of
Distributions payable for any period less than a full Distribution period will
be computed on the basis of a 360-day year of twelve 30-day months and the
actual days elapsed in a partial month in such period. Distributions payable for
each full Distribution period will be computed by dividing the rate per annum by
two. If any date on which Distributions are payable on the New Capital
Securities is not a Business Day, then payment of the Distributions payable on
such date will be made on the next succeeding day that is a Business Day
(without any additional Distributions or other payment in respect of any such
delay), with the same force and effect as if made on the date such payment was
originally payable.
So long as no Debenture Event of Default has occurred and is continuing,
the Company has the right under the Junior Subordinated Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the Junior Subordinated Debentures or end on a
date other than a Distribution Date. As a consequence of any such deferral,
semi-annual Distributions on the New Capital Securities by the Issuer Trust will
be deferred during any such Extension Period. Distributions to which holders of
the New Capital Securities are entitled will accumulate additional Distributions
thereon at a rate equal to 8.05% per annum, compounded semi- annually from the
relevant payment date for such Distributions, computed on the basis of a 360-day
year of twelve 30-day months and the actual days elapsed in a partial month in
such period. Additional Distributions payable for each full Distribution period
will be computed by dividing the rate per annum by two. The term "Distributions"
as used herein shall include any such additional Distributions. During any such
Extension Period, the Company may not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Company's capital 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 in all respects with or
junior in interest to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or shareholder stock purchase plan or in connection with the issuance of capital
stock of the Company (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any shareholder's rights
plan, or the issuance of rights, stock or other property under any shareholder's
rights plan, or the redemption or repurchase of rights pursuant thereto, or (e)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such stock). Prior to the termination of any
such Extension Period, the Company may further
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<PAGE>
defer the payment of interest, provided that no Extension Period may exceed 10
consecutive semi-annual periods, extend beyond the Stated Maturity of the Junior
Subordinated Debentures, or end on a date other than a Distribution Date. Upon
the termination of any such Extension Period and the payment of all amounts then
due, the Company may elect to begin a new Extension Period. No interest shall be
due and payable during an Extension Period, except at the end thereof. The
Company must give the Issuer Trustees and the Property Trustee notice of its
election of such Extension Period at least one Business Day prior to the earlier
of (i) the date the Distributions on the New Capital Securities would have been
payable but for the election to begin such Extension Period and (ii) the date
the Property Trustee is required to give notice to holders of the New Capital
Securities of the record date or the date such Distributions are payable, but in
any event not less than one Business Day prior to such record date. The Property
Trustee will give notice of the Company's election to begin a new Extension
Period to the holders of the New Capital Securities. Subject to the foregoing,
there is no limitation on the number of times that the Company may elect to
begin an Extension Period. See "Description of the New Junior Subordinated
Debentures -- Option To Extend Interest Payment Period" and "Certain Federal
Income Tax Consequences -- Interest Income and Original Issue Discount."
The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures.
The revenue of the Issuer Trust available for distribution to holders of
the New Capital Securities will be limited to payments under the Junior
Subordinated Debentures. See "Description of the New Junior Subordinated
Debentures." If the Company does not make payments on the Junior Subordinated
Debentures, the Issuer Trust may not have funds available to pay Distributions
or other amounts payable on the New Capital Securities. The payment of
Distributions and other amounts payable on the New Capital Securities (if and to
the extent the Issuer Trust has funds legally available for and cash sufficient
to make such payments) is guaranteed by the Company on a limited basis as set
forth herein under "Description of the Guarantee."
Redemption
Upon the repayment or redemption, in whole or in part, of the Junior
Subordinated Debentures, whether at maturity or upon earlier redemption as
provided in the Junior Subordinated Indenture, the proceeds from such repayment
or redemption shall be applied by the Property Trustee to redeem a Like Amount
(as defined below) of the Trust Securities, upon not less than 30 nor more than
60 days' notice, at a redemption price (the "Redemption Price") equal to the
aggregate Liquidation Amount of such Capital Securities plus accumulated but
unpaid Distributions thereon to but excluding the date of redemption (the
"Redemption Date") and the related amount of the premium, if any, paid by the
Company upon the concurrent redemption of such Junior Subordinated Debentures.
See "Description of the New Junior Subordinated Debentures -- Redemption." If
less than all the Junior Subordinated Debentures are to be repaid or redeemed on
a Redemption Date, then the proceeds from such repayment or redemption shall be
allocated to the redemption pro rata of the Capital Securities and the Common
Securities. The amount of premium, if any, paid by the Company upon the
redemption of all or any part of the Junior Subordinated Debentures to be repaid
or redeemed on a Redemption Date shall be allocated to the redemption pro rata
of the Capital Securities and the Common Securities.
The Company has the right to redeem the Junior Subordinated Debentures (i)
on or after March 1, 2008, in whole at any time or in part from time to time, or
(ii) in whole, but not in part, at any time within 90 days following the
occurrence and during the continuation of a Tax Event, Investment Company Event
or Capital Treatment Event (each as defined below), in each case subject to
possible regulatory approval. See " -- Liquidation Distribution Upon
Dissolution." A redemption of the Junior Subordinated Debentures would cause a
mandatory redemption of a Like Amount of the Capital Securities and Common
Securities at the Redemption Price.
The Redemption Price, in the case of a redemption under (i) above, shall
equal the following prices, expressed in percentages of their Liquidation Amount
(as defined below), together with accumulated Distributions to but excluding the
date fixed for redemption, if redeemed during the 12-month period beginning
March 1:
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Year Redemption Price
- ------------------ ------------------
2008 ........... 104.03%
2009 ........... 103.62
2010 ........... 103.22
2011 ........... 102.82
2012 ........... 102.42
2013 ........... 102.01
2014 ........... 101.61
2015 ........... 101.21
2016 ........... 100.81
2017 ........... 100.40
and at 100% on or after March 1, 2018.
The Redemption Price, in the case of a redemption on or after March 1, 2008
following a Tax Event, Investment Company Event or Capital Treatment Event shall
equal the Redemption Price then applicable to a redemption under (i) above. The
Redemption Price, in the case of a redemption prior to March 1, 2008 following a
Tax Event, Investment Company Event or Capital Treatment Event as described
under (ii) above, will equal for each Capital Security the Make-Whole Amount (as
defined below) for a corresponding $1,000 principal amount of Junior
Subordinated Debentures together with accumulated Distributions to but excluding
the date fixed for redemption. The "Make-Whole Amount" will be equal to the
greater of (i) 100% of the principal amount of such Junior Subordinated
Debentures and, (ii) as determined by a Quotation Agent (as defined below), the
sum of the present values of the principal amount and premium payable as part of
the Redemption Price with respect to an optional redemption of such Junior
Subordinated Debentures on March 1, 2008, together with the present values of
scheduled payments of interest (not including the portion of any such payments
of interest accrued as of the Redemption Date) from the Redemption Date to March
1, 2008 (the "Remaining Life"), in each case discounted to the Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of 30-day months) at
the Adjusted Treasury Rate.
"Adjusted Treasury Rate" means, with respect to any Redemption Date, the
Treasury Rate plus (i) 150 basis points if such Redemption Date occurs on or
before March 1, 1999 or (ii) 100 basis points if such Redemption Date occurs
after March 1, 1999.
"Treasury Rate" means (i) the yield, under the heading which represents the
average for the week immediately prior to the calculation date, appearing in the
most recently published statistical release designated "H.15 (519)" or any
successor publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United States Treasury securities adjusted
to constant maturity under the caption "Treasury Constant Maturities," for the
maturity corresponding to the Remaining Life (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 Treasury Rate shall be interpolated or extrapolated from such yields on
a straight-line basis, rounding to the nearest month) or (ii) if such release
(or any successor release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such Redemption Date. The Treasury Rate shall be calculated on the third
Business Day preceding the Redemption Date.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a day
on which banking institutions in the City of New York or the City of Raleigh,
North Carolina are authorized or required by law or executive order to remain
closed, or (c) a day on which the Property Trustee's Corporate Trust Office or
the Corporate Trust Office of the Debenture Trustee is closed for business.
"Like Amount" means (i) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount (as defined below) equal to that
portion of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Junior Subordinated Indenture,
allocated to the Common Securities and to the Capital Securities pro rata based
upon the relative Liquidation Amounts of such classes and (ii) with respect to a
distribution of Junior Subordinated Debentures to holders of Trust Securities in
connection with a dissolution or liquidation of the Issuer Trust, Subordinated
Debentures having a principal amount equal to the Liquidation Amount of the
Trust Securities of the holder to whom such Junior Subordinated Debentures are
distributed.
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"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
"Tax Event" means the receipt by the Issuer Trust of an opinion of counsel
to the Company 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 or administrative pronouncement or action 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 Capital Securities, there is more than an insubstantial risk
that (i) the Issuer Trust is, or will be within 90 days of the delivery of such
opinion, subject to United States federal income tax with respect to income
received or accrued on the Junior Subordinated Debentures, (ii) interest payable
by the Company on the Junior Subordinated Debentures is not, or within 90 days
of the delivery 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
Issuer Trust is, or will be within 90 days of the delivery of such opinion,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"Investment Company Event" means the receipt by the Issuer Trust of an
opinion of counsel to the Company experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation or a
written change (including any announced prospective 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 Issuer Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act, which change or
prospective change becomes effective or would become effective, as the case may
be, on or after the date of the issuance of the Capital Securities.
"Capital Treatment Event" means, in respect of the Issuer Trust, the
reasonable determination by the Company that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in, the
laws (or any rules or regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement, action or decision is announced on or after the date of
issuance of the Capital Securities, there is more than an insubstantial risk
that the Company will not be entitled to treat an amount equal to the
Liquidation Amount of the Capital Securities as "Tier 1 Capital" (or the then
equivalent thereof) for purposes of the risk-based capital adequacy guidelines
of the Federal Reserve, as then in effect and applicable to the Company.
Payment of Additional Sums. If a Tax Event described in clause (i) or (iii)
of the definition of Tax Event above has occurred and is continuing and the
Issuer Trust is the holder of all the Junior Subordinated Debentures, the
Company will pay Additional Sums (as defined below), if any, on the Junior
Subordinated Debentures.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by the Issuer Trust on the
outstanding Capital Securities and Common Securities of the Issuer Trust will
not be reduced as a result of any additional taxes, duties and other
governmental charges to which the Issuer Trust has become subject as a result of
a Tax Event.
Redemption Procedures
Capital Securities redeemed on each Redemption Date shall be redeemed at
the Redemption Price with the applicable proceeds from the contemporaneous
redemption of the Junior Subordinated Debentures. Redemptions of the Capital
Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the Issuer Trust has funds on hand
available for the payment of such Redemption Price. See also " -- Subordination
of Common Securities."
If the Issuer Trust gives a notice of redemption in respect of any Capital
Securities, then, by 12:00 noon, New York City time, on the Redemption Date, to
the extent funds are available, in the case of Capital Securities held in
book-entry form, the Property Trustee will deposit irrevocably with DTC funds
sufficient to pay the applicable Redemption Price and will give DTC irrevocable
instructions and authority to pay the Redemption Price to the holders of the
Capital Securities. With respect to Capital Securities not held in book-entry
form, the Property Trustee, to the extent funds are available, will irrevocably
deposit with the paying agent for the Capital 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 the holders thereof
upon surrender of their certificates evidencing the Capital Securities.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Capital Securities called for redemption shall be
payable to the holders of the Capital Securities on the relevant record dates
for the related Distribution Dates. If notice of redemption shall have
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been given and funds deposited as required, then upon the date of such deposit
all rights of the holders of such Capital Securities so called for redemption
will cease, except the right of the holders of such Capital Securities to
receive the Redemption Price, and any Distribution payable in respect of the
Capital Securities, but without interest on such Redemption Price, and such
Capital Securities will cease to be outstanding. If any date fixed for
redemption of Capital Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next succeeding day
which is a Business Day (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 the
event that payment of the Redemption Price in respect of Capital Securities
called for redemption is improperly withheld or refused and not paid either by
the Issuer Trust or by the Company pursuant to the Guarantee as described under
"Description of the Guarantee," Distributions on such Capital Securities will
continue to accumulate at the then applicable rate, from the Redemption Date
originally established by the Issuer Trust for such Capital 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.
Subject to applicable law (including, without limitation, United States
federal securities laws), the Company or its affiliates may at any time and from
time to time purchase outstanding Capital Securities by tender, in the open
market or by private agreement, and may resell such securities.
If less than all the Capital Securities and Common Securities are to be
redeemed on a Redemption Date, then the aggregate Liquidation Amount of such
Capital Securities and Common Securities to be redeemed shall be allocated pro
rata to the Capital Securities and the Common Securities based upon the relative
Liquidation Amounts of such classes. The particular Capital Securities to be
redeemed shall be selected on a pro rata basis not more than 60 days prior to
the Redemption Date by the Property Trustee from the outstanding Capital
Securities not previously called for redemption, or if the Capital Securities
are then held in the form of a Global Capital Security (as defined below), in
accordance with DTC's customary procedures. The Property Trustee shall promptly
notify the securities registrar for the Trust Securities in writing of the
Capital Securities selected for redemption and, in the case of any Capital
Securities selected for partial redemption, the Liquidation Amount thereof to be
redeemed. For all purposes of the Trust Agreement, unless the context otherwise
requires, all provisions relating to the redemption of Capital Securities shall
relate, in the case of any Capital Securities redeemed or to be redeemed only in
part, to the portion of the aggregate Liquidation Amount of Capital Securities
which has been or is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each registered holder of Capital
Securities to be redeemed at its address appearing on the securities register
for the Trust Securities. Unless the Company defaults in payment of the
Redemption Price on the Junior Subordinated Debentures, on and after the
Redemption Date interest will cease to accrue on the Junior Subordinated
Debentures or portions thereof (and, unless payment of the Redemption Price in
respect of the Capital Securities is withheld or refused and not paid either by
the Issuer Trust or the Company pursuant to the Guarantee, Distributions will
cease to accumulate on the Capital Securities or portions thereof) called for
redemption.
Subordination of Common Securities
Payment of Distributions (including Additional Amounts (as defined below),
if any) on, the Liquidation Distribution (as defined below) in respect of, and
the Redemption Price of, the Capital Securities and Common Securities, as
applicable, shall be made pro rata based on the Liquidation Amount of such
Capital Securities and Common Securities. However, if on any Distribution Date
or Redemption Date a Debenture Event of Default has occurred and is continuing
as a result of any failure by the Company to pay any amounts in respect of the
Junior Subordinated Debentures when due, no payment of any Distribution
(including Additional Amounts) on, or Liquidation Distribution in respect of, or
Redemption Price of, any of the Common Securities, and no other payment on
account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts) on all the outstanding
Capital 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 the outstanding Capital Securities then called for
redemption, or, in the case of payment of the Liquidation Distribution, the full
amount of such Liquidation Distribution on all outstanding Capital Securities,
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) on, or Redemption Price of, or
Liquidation Distributions in respect of, the Capital Securities then due and
payable. The existence of an Event of Default (as defined below) does not
entitle the holders of Capital Securities to accelerate the maturity thereof.
"Additional Amounts" means, with respect to Trust Securities of a given
Liquidation Amount
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and/or a given period, the amount of Additional Interest (as defined in the
Junior Subordinated Indenture) paid by the Company on a Like Amount of the
Junior Subordinated Debentures for such period.
In the case of any Event of Default (as defined below) resulting from a
Debenture Event of Default, the holders of the Common Securities will be deemed
to have waived any right to act with respect to any such Event of Default under
the Trust Agreement until the effects of all such Events of Default with respect
to such Capital Securities have been cured, waived or otherwise eliminated. See
" -- Events of Default; Notice" and "Description of the New Junior Subordinated
Debentures -- Debenture Events of Default." Until all such Events of Default
under the Trust Agreement with respect to the Capital Securities have been so
cured, waived or otherwise eliminated, the Property Trustee will act solely on
behalf of the holders of the Capital Securities and not on behalf of the holders
of the Common Securities, and only the holders of the Capital Securities will
have the right to direct the Property Trustee to act on their behalf.
Liquidation Distribution on Dissolution
The amount payable on the Capital Securities in the event of any
liquidation of the Issuer Trust is $1,000 per Capital Security plus accumulated
and unpaid Distributions to the date of payment, subject to certain exceptions,
which may be in the form of a distribution of such amount in Junior Subordinated
Debentures.
The holders of all the outstanding Common Securities have the right at any
time to dissolve the Issuer Trust and, after satisfaction of liabilities to
creditors of the Issuer Trust as provided by applicable law, cause the Junior
Subordinated Debentures to be distributed to the holders of the Capital
Securities and Common Securities in liquidation of the Issuer Trust.
The Federal Reserve's risk-based capital guidelines currently provide that
redemptions of permanent equity or other capital instruments before stated
maturity could have a significant impact on a bank holding company's overall
capital structure and that any organization considering such a redemption should
consult with the Federal Reserve before redeeming any equity or capital
instrument prior to maturity if such redemption could have a material effect on
the level or composition of the organization's capital base (unless the equity
or capital instrument were redeemed with the proceeds of, or replaced by, a like
amount of a similar or higher quality capital instrument and the Federal Reserve
considers the organization's capital position to be fully adequate after the
redemption).
In the event the Company, while a holder of Common Securities, dissolves
the Issuer Trust prior to the Stated Maturity of the Capital Securities and the
dissolution of the Issuer Trust is deemed to constitute the redemption of
capital instruments by the Federal Reserve under its risk-based capital
guidelines or policies, the dissolution of the Issuer Trust by the Company may
be subject to the prior approval of the Federal Reserve. Moreover, any changes
in applicable law or changes in the Federal Reserve's risk-based capital
guidelines or policies could impose a requirement on the Company that it obtain
the prior approval of the Federal Reserve to dissolve the Issuer Trust.
Pursuant to the Trust Agreement, the Issuer Trust will automatically
dissolve upon expiration of its term or, if earlier, will dissolve on the first
to occur of: (i) certain events of bankruptcy, dissolution or liquidation of the
Company or the holder of the Common Securities, (ii) if the holders of Common
Securities have given written direction to the Property Trustee to dissolve the
Issuer Trust (which direction, subject to the foregoing restrictions, is
optional and wholly within the discretion of the holders of Common Securities),
(iii) the repayment of all the Capital Securities in connection with the
redemption of all the Trust Securities as described under " -- Redemption," and
(iv) the entry of an order for the dissolution of the Issuer Trust by a court of
competent jurisdiction.
If dissolution of the Issuer Trust occurs as described in clause (i), (ii)
or (iv) above, the Issuer Trust will be liquidated by the Property Trustee as
expeditiously as the Property Trustee determines to be possible by distributing,
after satisfaction of liabilities to creditors of the Issuer Trust as provided
by applicable law, to the holders of such Trust Securities a Like Amount of the
Junior Subordinated Debentures, unless such distribution is not practical, in
which event such holders will be entitled to receive out of the assets of the
Issuer Trust available for distribution to holders, after satisfaction of
liabilities to creditors of the Issuer Trust as provided by applicable law, an
amount equal to, in the case of holders of Capital Securities, the aggregate of
the Liquidation Amount plus accumulated and unpaid Distributions thereon to the
date of payment (such amount being the "Liquidation Distribution"). If such
Liquidation Distribution can be paid only in part because the Issuer Trust has
insufficient assets available to pay in full the aggregate Liquidation
Distribution, then the amounts payable directly by the Issuer Trust on its
Capital Securities shall be paid on a pro rata basis. The holders of the Common
Securities will be entitled to receive distributions upon any such liquidation
pro rata with the holders of the Capital Securities, except that if a Debenture
Event of Default has occurred and is continuing as a result of any failure by
the Company to pay any amounts in respect of the Junior Subordinated Debentures
when due, the Capital Securities shall have a priority over the Common
Securities. See " -- Subordination of Common Securities."
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After the liquidation date fixed for any distribution of Junior
Subordinated Debentures (i) the Capital Securities will no longer be deemed to
be outstanding, (ii) DTC or its nominee, as the registered holder of Capital
Securities represented by Global Capital Securities (as defined herein), will
receive a registered global certificate or certificates representing the Junior
Subordinated Debentures to be delivered upon such distribution with respect to
such Global Capital Securities and (iii) each certificate representing the
Capital Securities other than the Global Capital Securities will be deemed to
represent the Junior Subordinated Debentures having a principal amount equal to
the stated Liquidation Amount of the Capital Securities and bearing accrued and
unpaid interest in an amount equal to the accumulated and unpaid Distributions
on the Capital Securities until such certificates are presented to the security
registrar for the Trust Securities for transfer or reissuance.
If the Company does not redeem the Junior Subordinated Debentures prior to
the Stated Maturity and the Issuer Trust is not liquidated and the Junior
Subordinated Debentures are not distributed to holders of the Capital
Securities, the Capital Securities will remain outstanding until the repayment
of the Junior Subordinated Debentures and the distribution of the Liquidation
Distribution to the holders of the Capital Securities.
There can be no assurance as to the market prices for the Capital
Securities or the Junior Subordinated Debentures that may be distributed in
exchange for Capital Securities if a dissolution and liquidation of the Issuer
Trust were to occur. Accordingly, the Capital Securities that an investor may
purchase, whether pursuant to the offer made hereby or in the secondary market,
or the Junior Subordinated Debentures that the investor may receive on
dissolution and liquidation of the Issuer Trust, may trade at a discount to the
price that the investor paid to purchase the Capital Securities offered hereby.
Events of Default; Notice
Any one of the following events constitutes an "Event of Default" under the
Trust Agreement (an "Event of Default") with respect to the Capital Securities
(whatever the reason for such Event of Default and whether it is voluntary or
involuntary or is effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of a Debenture Event of Default (see "Description of the
New Junior Subordinated Debentures -- Debenture Events of Default"); or
(ii) default by the Issuer Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of 30
days; or
(iii) default by the Issuer Trust in the payment of any Redemption Price of
any Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Issuer Trustees in the Trust Agreement (other than a
covenant or warranty a default in the performance of which or the breach of
which is dealt with in clause (ii) or (iii) above), and continuation of such
default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the Issuer Trustees and the Company by the
holders of at least 25% in aggregate Liquidation Amount of the outstanding
Capital Securities, a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" under the Trust Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee if a successor Property Trustee has not been
appointed within 90 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee will transmit
notice of such Event of Default to the holders of Trust Securities and the
Administrators, unless such Event of Default has been cured or waived. The
Company, as Depositor, and the Administrators are required to file annually with
the Property Trustee a certificate as to whether or not they are in compliance
with all the conditions and covenants applicable to them under the Trust
Agreement.
If a Debenture Event of Default has occurred and is continuing as a result
of any failure by the Company to pay any amounts in respect of the Junior
Subordinated Debentures when due, the Capital Securities will have a preference
over the Common Securities with respect to payments of any amounts in respect of
the Capital Securities as described above. See " -- Subordination of Common
Securities," " -- Liquidation Distribution Upon Dissolution" and "Description of
the New Junior Subordinated Debentures -- Debenture Events of Default."
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Removal of Issuer Trustees; Appointment of Successors
The holders of at least a majority in aggregate Liquidation Amount of the
outstanding Capital Securities may remove an Issuer Trustee for cause or, if a
Debenture Event of Default has occurred and is continuing, with or without
cause. If an Issuer Trustee is removed by the holders of the outstanding Capital
Securities, the successor may be appointed by the holders of at least 25% in
Liquidation Amount of Capital Securities then outstanding. If an Issuer Trustee
resigns, such Issuer Trustee will appoint its successor. If an Issuer Trustee
fails to appoint a successor, the holders of at least 25% in Liquidation Amount
of the outstanding Capital Securities may appoint a successor. If a successor
has not been appointed by the holders, any holder of Capital Securities or
Common Securities or the other Issuer Trustee may petition a court in the State
of Delaware to appoint a successor. Any Delaware Trustee must meet the
applicable requirements of Delaware law. Any Property Trustee must be a national
or state-chartered bank, and at the time of appointment have securities rated in
one of the three highest rating categories by a nationally recognized
statistical rating organization and have combined capital and surplus of at
least $50,000,000. No resignation or removal of an Issuer Trustee and no
appointment of a successor trustee shall be effective until the acceptance of
appointment by the successor trustee in accordance with the provisions of the
Trust Agreement.
Merger or Consolidation of Issuer Trustees
Any entity into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any entity
resulting from any merger, conversion or consolidation to which such Issuer
Trustee is a party, or any entity succeeding to all or substantially all of the
corporate trust business of such Issuer Trustee, will be the successor of such
Issuer Trustee under the Trust Agreement, provided such entity is otherwise
qualified and eligible.
Mergers, Consolidations, Amalgamations or Replacements of the Issuer Trust
The Issuer Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any entity, except as described below or as
otherwise set forth in the Trust Agreement. The Issuer Trust may, at the request
of the holders of the Common Securities and with the consent of the holders of
at least a majority in aggregate Liquidation Amount of the outstanding Capital
Securities, merge with or into, consolidate, 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, so long as (i) such
successor entity either (a) expressly assumes all the obligations of the Issuer
Trust with respect to the Capital Securities or (b) substitutes for the Capital
Securities other securities having substantially the same terms as the Capital
Securities (the "Successor Securities") so long as the Successor Securities have
the same priority as the Capital Securities with respect to distributions and
payments upon liquidation, redemption and otherwise, (ii) a trustee of such
successor entity, possessing the same powers and duties as the Property Trustee,
is appointed to hold the Junior Subordinated Debentures, (iii) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
cause the Capital Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (iv)
such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
holders of the Capital Securities (including any Successor Securities) in any
material respect, (v) such successor entity has a purpose substantially
identical to that of the Issuer Trust, (vi) prior to such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the Issuer Trust has
received an opinion from independent counsel experienced in such matters to the
effect that (a) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Capital Securities (including any Successor
Securities) in any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Issuer Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act, and (vii) the Company or
any permitted successor or assignee owns all 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 Issuer Trust may not, except with the consent
of holders of 100% in aggregate Liquidation Amount of the Capital Securities,
consolidate, 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 entity or permit any other entity to consolidate, amalgamate, merge with
or into, or replace it if such consolidation, amalgamation, merger, replacement,
conveyance, transfer or lease would cause the Issuer Trust or the successor
entity to be taxable other than as a grantor trust for United States federal
income tax purposes.
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Voting Rights; Amendment of Trust Agreement
Except as provided below and under " -- Removal of Issuer Trustees;
Appointment of Successors" and "Description of the Guarantee -- Amendments and
Assignment" and as otherwise required by law and the Trust Agreement, the
holders of the Capital Securities will have no voting rights.
The Trust Agreement may be amended from time to time by the holders of a
majority in Liquidation Amount of the Common Securities and the Property
Trustee, without the consent of the holders of the Capital Securities, (i) to
cure any ambiguity, correct or supplement any provisions in the Trust Agreement
that may be inconsistent with any other provision, or to make any other
provisions with respect to matters or questions arising under the Trust
Agreement, provided that any such amendment does not adversely affect in any
material respect the interests of any holder of Trust Securities, or (ii) to
modify, eliminate or add to any provisions of the Trust Agreement to such extent
as may be necessary to ensure that the Issuer Trust will not be taxable other
than as a grantor trust for United States federal income tax purposes at any
time that any Trust Securities are outstanding or to ensure that the Issuer
Trust will not be required to register as an "investment company" under the
Investment Company Act, and any amendments of the Trust Agreement will become
effective when notice of such amendment is given to the holders of Trust
Securities. The Trust Agreement may be amended by the holders of a majority in
Liquidation Amount of the Common Securities and the Property Trustee with (i)
the consent of holders representing not less than a majority in aggregate
Liquidation Amount of the outstanding Capital Securities and (ii) receipt by the
Issuer Trustees of an opinion of counsel to the effect that such amendment or
the exercise of any power granted to the Issuer Trustees in accordance with such
amendment will not affect the Issuer Trust's being taxable as a grantor trust
for United States federal income tax purposes or the Issuer Trust's exemption
from status as an "investment company" under the Investment Company Act, except
that, without the consent of each holder of Trust Securities affected thereby,
the Trust Agreement may not be amended to (x) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (y) restrict the right of a holder of Trust Securities to
institute suit for the enforcement of any such payment on or after such date.
So long as any Junior Subordinated Debentures are held by the Issuer Trust,
the Property Trustee will not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
execute any trust or power conferred on the Property Trustee with respect to the
Junior Subordinated Debentures, (ii) waive any past default that is waivable
under Section 5.13 of the Junior Subordinated Indenture, (iii) exercise any
right to rescind or annul a declaration that the Junior Subordinated Debentures
shall be due and payable or (iv) consent to any amendment, modification or
termination of the Junior Subordinated Indenture or the Junior Subordinated
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the holders of at least a majority in aggregate
Liquidation Amount of the outstanding Capital Securities, except that, if a
consent under the Junior Subordinated Indenture would require the consent of
each holder of Junior Subordinated Debentures affected thereby, no such consent
will be given by the Property Trustee without the prior consent of each holder
of the Capital Securities. The Property Trustee may not revoke any action
previously authorized or approved by a vote of the holders of the Capital
Securities except by subsequent vote of the holders of the Capital Securities.
The Property Trustee will notify each holder of Capital Securities of any notice
of default with respect to the Junior Subordinated Debentures. In addition to
obtaining the foregoing approvals of the holders of the Capital Securities,
before taking any of the foregoing actions, the Property Trustee will obtain an
opinion of counsel experienced in such matters to the effect that the Issuer
Trust will not be taxable other than as a grantor trust for United States
federal income tax purposes on account of such action.
Any required approval of holders of Capital Securities may be given at a
meeting of holders of Capital Securities convened for such purpose or pursuant
to written consent. The Property Trustee will cause a notice of any meeting at
which holders of Capital Securities are entitled to vote, or of any matter upon
which action by written consent of such holders is to be taken, to be given to
each registered holder of Capital Securities in the manner set forth in the
Trust Agreement.
No vote or consent of the holders of Capital Securities will be required to
redeem and cancel Capital Securities in accordance with the Trust Agreement.
Notwithstanding that holders of Capital Securities are entitled to vote or
consent under any of the circumstances described above, any of the Capital
Securities that are owned by the Company, the Issuer Trustees or any affiliate
of the Company or any Issuer Trustees, will, for purposes of such vote or
consent, be treated as if they were not outstanding.
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Book-Entry Only Issuance -- The Depository Trust Company
The New Capital Securities initially will be represented by one or more
Capital Securities in registered, global form (collectively, the "Global Capital
Securities"). The laws of some jurisdictions require that certain purchasers of
securities take physical delivery of securities in definitive form. Such laws
may impair the ability to transfer beneficial interests in the Global Capital
Securities as represented by a Global Certificate.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its participants ("Participants") deposit with DTC. DTC
also facilitates the settlement among Participants of securities transactions,
such as transfers and pledges, in deposited securities through electronic
computerized book-entry changes in Participants' accounts, thereby eliminating
the need for physical movement of securities certificates. Participants in DTC
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations ("Direct Participants"). DTC is
owned by a number of its Direct Participants and by the New York Stock Exchange,
Inc., the American Stock Exchange, Inc., and the National Association of
Securities Dealers, Inc. Access to the DTC system is also available to others,
such as securities brokers and dealers, banks and trust companies that clear
transactions through or maintain a direct or indirect custodial relationship
with a Direct Participant, either directly or indirectly ("Indirect
Participants"). The rules applicable to DTC and its Participants are on file
with the Commission.
Purchases of the Capital Securities within the DTC system must be made by
or through Direct Participants, which will receive a credit for the Capital
Securities on DTC's records. The ownership interest of each actual purchaser of
each Capital Security ("Beneficial Owner") is in turn to be recorded on the
Direct Participants' and Indirect Participants' records. Beneficial Owners will
not receive written confirmation from DTC of their purchases, but Beneficial
Owners are expected to receive written confirmations providing details of the
transactions, as well as periodic statements of their holdings, from the Direct
or Indirect Participants through which the Beneficial Owners purchased the
Capital Securities. Transfers of ownership interests in the Capital Securities
are to be accomplished by entries made on the books of Participants acting on
behalf of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in the Capital Securities, except in the
event that use of the book-entry system for the Capital Securities is
discontinued.
To facilitate subsequent transfers, all the Capital Securities deposited by
Participants with DTC will be registered in the name of DTC's nominee, Cede &
Co. The deposit of the Capital Securities with DTC and their registration in the
name of Cede & Co. will effect no change in beneficial ownership. DTC will have
no knowledge of the actual Beneficial Owners of the Capital Securities. DTC's
records will reflect only the identity of the Direct Participants to whose
accounts such Capital Securities are credited, which may or may not be the
Beneficial Owners. The Direct Participants and Indirect Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
So long as DTC, or its nominee, is the registered owner or holder of a
Global Certificate in respect of the Capital Securities, DTC or such nominee, as
the case may be, will be considered the sole owner or holder of the Capital
Securities represented thereby for all purposes under the Trust Agreement and
such Capital Securities. No Beneficial Owner of an interest in a Global
Certificate will be able to transfer that interest except in accordance with
DTC's applicable procedures.
DTC has advised the Company that it will take any action permitted to be
taken by a holder of the Capital Securities (including the presentation of the
Capital Securities for exchange as described below) only at the direction of one
or more Participants to whose accounts the DTC interest in the Global
Certificates is credited and only in respect of such portion of the aggregate
Liquidation Amount of the Capital Securities as to which such Participant or
Participants has or have given such direction. However, if there is a Trust
Agreement Event of Default with respect to the Capital Securities, DTC will,
upon notice, exchange the Global Certificates in respect of such Capital
Securities for Certificated Securities, which it will distribute to its
Participants.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Redemption notices in respect of the Capital Securities held in book-entry
form will be sent to Cede & Co. If less than all of the Capital Securities are
being redeemed, the Capital Securities will be redeemed on a pro rata basis.
Although voting with respect to the Capital Securities is limited, in those
cases where a vote is required, neither DTC nor Cede & Co. will itself consent
or vote with respect to the Capital Securities. Under its usual procedures, DTC
would
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mail an omnibus proxy to the Issuer Trust as soon as possible after the record
date. The omnibus proxy assigns Cede & Co.'s consenting or voting rights to
those Direct Participants to whose accounts the Capital Securities are credited
on the record date (identified in a listing attached to the omnibus proxy).
Payments in respect of the Capital Securities held in book-entry form will
be made to DTC in immediately available funds. DTC's practice is to credit
Direct Participants' accounts on the relevant payment date in accordance with
their respective holdings shown on DTC's records unless DTC has reason to
believe that it will not receive payments on such payment date. Payments by
Direct Participants and Indirect Participants to Beneficial Owners will be
governed by standing instructions and customary practices and will be the
responsibility of such Direct Participants and Indirect Participants and not of
DTC, the Issuer Trust or the Company, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payments in respect of the
Capital Securities held in book-entry form to DTC are the responsibility of the
Issuer Trust, disbursement of such payments to Direct Participants is the
responsibility of DTC, and disbursement of such payments to the Beneficial
Owners is the responsibility of Direct Participants and Indirect Participants.
Except as provided herein, a Beneficial Owner of an interest in a Global
Certificate will not be entitled to receive physical delivery of the Capital
Securities. Accordingly, each Beneficial Owner must rely on the procedures of
DTC, the Direct Participants and the Indirect Participants to exercise any
rights under the Capital Securities.
Although DTC has agreed to the foregoing procedures in order to facilitate
transfers of interests in the Global Certificates among Participants of DTC, DTC
is under no obligation to perform or continue to perform such procedures, and
such procedures may be discontinued at any time. None of the Company, the Issuer
Trust, the Property Trustee, or the Delaware Trustee will have any
responsibility for the performance by DTC or its Direct Participants or Indirect
Participants under the rules and procedures governing DTC. DTC may discontinue
providing its services as a securities depositary with respect to the Capital
Securities at any time by giving notice to the Company and the Issuer Trust.
Under such circumstances, in the event that a successor securities depositary is
not obtained, the Capital Security certificates will be required to be printed
and delivered. Additionally, the Issuer Trust (with the consent of the Company)
may decide to discontinue use of the system of book-entry transfers through DTC
(or a successor depositary) with respect to the Capital Securities of the Issuer
Trust. In that event, certificates for such Capital Securities 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 Company and the Issuer Trust believe to
be reliable, but neither the Company nor the Issuer Trust takes responsibility
for the accuracy thereof.
Expenses and Taxes
In the Trust Agreement, the Company has agreed to pay all debts and other
obligations (other than with respect to the Capital Securities) and all costs
and expenses of the Issuer Trust (including costs and expenses relating to the
organization of the Issuer Trust, the fees and expenses of the Issuer Trustees
and the costs and expenses relating to the operation of the Issuer Trust) and to
pay any and all taxes and all costs and expenses with respect thereto (other
than withholding taxes) to which the Issuer Trust might become subject. The
foregoing obligations of the Company under the Trust Agreement 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 Issuer Trust or any other person before proceeding
against the Company. The Company has also agreed in the Trust Agreement to
execute such additional agreements as may be necessary or desirable to give full
effect to the foregoing.
Restrictions on Transfer
The Old Capital Securities were, and the New Capital Securities will be,
issued and may be transferred only in blocks having a Liquidation Amount of not
less than $100,000 (100 Old Capital Securities or New Capital Securities, as the
case may be). Any such transfer of the Old Capital Securities or the New Capital
Securities in a block having a Liquidation Amount of less than $100,000 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 Old Capital Securities or New Capital
Securities for any purpose, including but not limited to, the receipt of
distributions on such Old Capital Securities or New Capital Securities, and such
transferee shall be deemed to have no interest whatsoever in such Old Capital
Securities or New Capital Securities.
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Payment and Paying Agency
Payments in respect of the Capital Securities will be made to DTC, which
will credit the relevant accounts at DTC on the applicable Distribution Dates
or, if the Capital Securities are not held by DTC, such payments shall be made
by check mailed to the address of the holder entitled thereto as such address
appears on the securities register for the Trust Securities. The paying agent
for the Trust Securities (the "Paying Agent") initially will be the Property
Trustee and any co-paying agent chosen by the Property Trustee and acceptable to
the Administrators. The Paying Agent will be permitted to resign as Paying Agent
upon 30 days' written notice to the Property Trustee and the Administrators. If
the Property Trustee is no longer the Paying Agent, the Property Trustee will
appoint a successor (which must be a bank or trust company reasonably acceptable
to the Administrators) to act as Paying Agent.
Registrar and Transfer Agent
The Property Trustee is acting as registrar and transfer agent for the
Capital Securities.
Registration of transfers or exchanges of the Capital Securities will be
effected without charge by or on behalf of the Issuer Trust, but upon payment of
any tax or other governmental charges that may be imposed in connection with any
transfer or exchange. The Issuer Trust will not be required to register or cause
to be registered the transfer or exchange of the Capital Securities after such
Capital Securities have been called for redemption.
Information Concerning the Property Trustee
The Property Trustee, other than during the occurrence and continuance of
an Event of Default, undertakes to perform only such duties as are specifically
set forth in the Trust Agreement and, after such Event of Default, must exercise
the same degree of care and skill as a prudent person would exercise or use in
the conduct of his or her own affairs. Subject to this provision, the Property
Trustee is under no obligation to exercise any of the powers vested in it by the
Trust Agreement at the request of any holder of Capital Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby.
For information concerning the relationships between Bankers Trust Company,
the Property Trustee, and the Company, see "Description of the New Junior
Subordinated Debentures -- Information Concerning the Debenture Trustee."
Miscellaneous
The Administrators and the Property Trustee are authorized and directed to
conduct the affairs of and to operate the Issuer Trust in such a way that the
Issuer Trust will not be deemed to be an "investment company" required to be
registered under the Investment Company Act or taxable other than as a grantor
trust for United States federal income tax purposes and so that the Subordinated
Debentures will be treated as indebtedness of the Company for United States
federal income tax purposes. In this connection, the Property Trustee and the
holders of Common Securities are authorized to take any action, not inconsistent
with applicable law, the certificate of trust of the Issuer Trust or the Trust
Agreement, that the Property Trustee and the holders of Common Securities
determine in their discretion to be necessary or desirable for such purposes, as
long as such action does not materially adversely affect the interests of the
holders of the Capital Securities.
Holders of the Capital Securities have no preemptive or similar rights.
The Issuer Trust may not borrow money or issue debt or mortgage or pledge
any of its assets.
Governing Law
The Trust Agreement will be governed by and construed in accordance with
the laws of the State of Delaware.
DESCRIPTION OF THE NEW JUNIOR SUBORDINATED DEBENTURES
The New Junior Subordinated Debentures are to be issued under the Junior
Subordinated Indenture, under which Bankers Trust Company is acting as Debenture
Trustee. This summary of certain terms and provisions of the New Junior
Subordinated Debentures and the Junior Subordinated Indenture does not purport
to be complete and is subject to, and is qualified in its entirety by reference
to, all the provisions of the Junior Subordinated Indenture, including the
definitions therein of certain terms. Whenever particular defined terms of the
Junior Subordinated Indenture (as amended or supplemented from time to time) are
referred to herein, such defined terms are incorporated herein by reference. A
copy of the form of Junior Subordinated Indenture is available from the
Debenture Trustee upon request.
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General
Concurrently with the issuance of the Old Capital Securities, the Issuer
Trust invested the proceeds thereof, together with the consideration paid by the
Company for the Common Securities, in the Old Junior Subordinated Debentures
issued by the Company. Pursuant to the Exchange Offer, the Company will Exchange
up to $150 million aggregate principal amount of New Junior Subordinated
Debentures for a like amount of Old Junior Subordinated Debentures as soon as
practicable after the date of this Prospectus. The New Junior Subordinated
Debentures will bear interest, accruing from the date of original issuance, at a
rate equal to 8.05% per annum on the principal amount thereof, payable
semi-annually in arrears on the 1st day of March and September of each year
(each, an "Interest Payment Date"), commencing March 1, 1999, to the person in
whose name each New Junior Subordinated Debenture is registered at the close of
business on the February 15 or August 15 (whether or not a Business Day) next
preceding such Interest Payment Date. It is anticipated that, until the
liquidation, if any, of the Issuer Trust, each New Junior Subordinated Debenture
will be registered in the name of the Issuer Trust and held by the Property
Trustee in trust for the benefit of the holders of the Trust Securities. The
amount of interest payable for any period less than a full interest period will
be computed on the basis of a 360-day year of twelve 30-day months and the
actual days elapsed in a partial month in such period. The amount of interest
payable for any full interest period will be computed by dividing the rate per
annum by two. If any date on which interest is payable on the New Junior
Subordinated Debentures is not a Business Day, then payment of the interest
payable on such date will be made on the next succeeding day that is a Business
Day (without any interest or other payment in respect of any such delay), with
the same force and effect as if made on the date such payment was originally
payable. Accrued interest that is not paid on the applicable Interest Payment
Date will bear additional interest on the amount thereof (to the extent
permitted by law) at a rate equal to 8.05% per annum, compounded semi-annually
and computed on the basis of a 360-day year of twelve 30-day months and the
actual days elapsed in a partial month in such period. The amount of additional
interest payable for any full interest period will be computed by dividing the
rate per annum by two. The term "interest" as used herein includes semi-annually
interest payments, interest on semi-annually interest payments not paid on the
applicable Interest Payment Date and Additional Sums (as defined below), as
applicable.
The New Junior Subordinated Debentures will mature on March 1, 2028.
The New Junior Subordinated Debentures will be unsecured and will rank
junior and be subordinate in right of payment to all Senior Indebtedness of the
Company. The New Junior Subordinated Debentures will not be subject to a sinking
fund and will not be eligible as collateral for any loan made by the Company.
The Junior Subordinated Indenture does not limit the incurrence or issuance of
other secured or unsecured debt by the Company, including Senior Indebtedness,
whether under the Junior Subordinated Indenture or any existing or other
indenture or agreement that the Company may enter into in the future or
otherwise. See " -- Subordination."
Option to Extend Interest Payment Period
So long as no Debenture Event of Default has occurred and is continuing,
the Company has the right at any time during the term of the New Junior
Subordinated Debentures to defer the payment of interest at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the New Junior Subordinated Debentures or end on a
date other than an Interest Payment Date. At the end of such Extension Period,
the Company must pay all interest then accrued and unpaid (together with
interest thereon at a rate equal to 8.05% per annum, compounded semi-annually
and computed on the basis of a 360-day year of twelve 30-day months and the
actual days elapsed in a partial month in such period, to the extent permitted
by applicable law). The amount of additional interest payable for any full
interest period will be computed by dividing the rate per annum by two. During
an Extension Period, interest will continue to accrue and holders of New Junior
Subordinated Debentures (or holders of Capital Securities while outstanding)
will be required to accrue original issue discount income for United States
federal income tax purposes. See "Certain Federal Income Tax Consequences --
Interest Income and Original Issue Discount."
During any such Extension Period, the Company may not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's capital 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 in
all respects with or junior in interest to the New Junior Subordinated
Debentures (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants, in connection
with a dividend reinvestment or shareholder stock purchase plan or in connection
with the
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issuance of capital stock of the Company (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) the purchase of fractional interests in shares of the Company's capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged, (d) any declaration of a dividend in
connection with any shareholder's rights plan, or the issuance of rights, stock
or other property under any shareholders rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or the stock issuable
upon exercise of such warrants, options or other rights is the same stock as
that on which the dividend is being paid or ranks pari passu with or junior to
such stock). Prior to the termination of any such Extension Period, the Company
may further defer the payment of interest, provided that no Extension Period may
exceed 10 consecutive semi-annual periods, extend beyond the Stated Maturity of
the New Junior Subordinated Debentures, or end on a date other than an Interest
Payment Date. Upon the termination of any such Extension Period and the payment
of all amounts then due, the Company may elect to begin a new Extension Period
subject to the above conditions. No interest shall be due and payable during an
Extension Period, except at the end thereof. The Company must give the Issuer
Trustees notice of its election of such Extension Period at least one Business
Day prior to the earlier of (i) the date the Distributions on the Capital
Securities would have been payable but for the election to begin such Extension
Period and (ii) the date the Property Trustee is required to give notice to
holders of the Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date. The Property Trustee will give notice of the Company's
election to begin a new Extension Period to the holders of the Capital
Securities. There is no limitation on the number of times that the Company may
elect to begin an Extension Period.
Redemption
The New Junior Subordinated Debentures are redeemable prior to maturity at
the option of the Company (i) on or after March 1, 2008, in whole at any time or
in part from time to time, or (ii) in whole, but not in part, at any time within
90 days following the occurrence and during the continuation of a Tax Event,
Investment Company Event or Capital Treatment Event (each as defined under
"Description of the New Capital Securities -- Redemption"), in each case at the
redemption price described below. The proceeds of any such redemption will be
used by the Issuer Trust to redeem the Capital Securities.
The Federal Reserve's risk-based capital guidelines, which are subject to
change, currently provide that redemptions of permanent equity or other capital
instruments before stated maturity could have a significant impact on a bank
holding company's overall capital structure and that any organization
considering such a redemption should consult with the Federal Reserve before
redeeming any equity or capital instrument prior to maturity if such redemption
could have a material effect on the level or composition of the organization's
capital base (unless the equity or capital instrument were redeemed with the
proceeds of, or replaced by, a like amount of a similar or higher quality
capital instrument and the Federal Reserve considers the organization's capital
position to be fully adequate after the redemption).
The redemption of the New Junior Subordinated Debentures by the Company
prior to their Stated Maturity would constitute the redemption of capital
instruments under the Federal Reserve's current risk-based capital guidelines
and may be subject to the prior approval of the Federal Reserve.
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The Redemption Price for New Junior Subordinated Debentures in the case of
a redemption under (i) above shall equal the following prices, expressed in
percentages of their principal amount, together with accrued interest to but
excluding the date fixed for redemption, if redeemed during the 12-month period
beginning March 1:
Year Redemption Price
- ----------------- -----------------
2008 .......... 104.03%
2009 .......... 103.62
2010 .......... 103.22
2011 .......... 102.82
2012 .......... 102.42
2013 .......... 102.01
2014 .......... 101.61
2015 .......... 101.21
2016 .......... 100.81
2017 .......... 100.40
and at 100% on or after March 1, 2018.
The Redemption Price in the case of a redemption on or after March 1, 2008
following a Tax Event, Investment Company Event or Capital Treatment Event shall
equal the Redemption Price then applicable to a redemption under (i) above. The
Redemption Price for New Junior Subordinated Debentures, in the case of a
redemption prior to March 1, 2008 following a Tax Event, Investment Company
Event or Capital Treatment Event as described under (ii) above, will equal the
Make-Whole Amount (as defined under "Description of the New Capital Securities
- -- Redemption"), together with accrued interest to but excluding the date fixed
for redemption.
Additional Sums
The Company has covenanted in the Junior Subordinated Indenture that, if
and for so long as (i) the Issuer Trust is the holder of all New Junior
Subordinated Debentures and (ii) the Issuer Trust is required to pay any
additional taxes, duties or other governmental charges as a result of a Tax
Event, the Company will pay as additional sums on the New Junior Subordinated
Debentures such amounts as may be required so that the Distributions payable by
the Issuer Trust will not be reduced as a result of any such additional taxes,
duties or other governmental charges. See "Description of the New Capital
Securities -- Redemption."
Registration, Denomination and Transfer
The New Junior Subordinated Debentures will initially be registered in the
name of the Issuer Trust. If the New Junior Subordinated Debentures are
distributed to holders of Capital Securities, it is anticipated that the
depositary arrangements for the New Junior Subordinated Debentures will be
substantially identical to those in effect for the Capital Securities. See
"Description of the New Capital Securities -- Book-Entry Only Issuance -- The
Depository Trust Company."
Payments on New Junior Subordinated Debentures represented by a global
security will be made to Cede & Co., the nominee for DTC, as the registered
holder of the New Junior Subordinated Debentures, as described under
"Description of the New Capital Securities -- Book-Entry Only Issuance -- The
Depository Trust Company." If New Junior Subordinated Debentures are issued in
certificated form, principal and interest will be payable, the transfer of the
New Junior Subordinated Debentures will be registrable, and New Junior
Subordinated Debentures will be exchangeable for New Junior Subordinated
Debentures of other authorized denominations of a like aggregate principal
amount, at the corporate trust office of the Debenture Trustee in New York, New
York or at the offices of any Paying Agent or transfer agent appointed by the
Company, provided that payment of interest may be made at the option of the
Company by check mailed to the address of the persons entitled thereto. However,
a holder of $1 million or more in aggregate principal amount of New Junior
Subordinated Debentures may receive payments of interest (other than interest
payable at the Stated Maturity) by wire transfer of immediately available funds
upon written request to the Debenture Trustee not later than 15 calendar days
prior to the date on which the interest is payable.
The New Junior Subordinated Debentures will be issuable only in registered
form without coupons in integral multiples of $1,000. The minimum purchase
requirement will be $100,000 (100 Capital Securities). New Junior Subordinated
Debentures will be exchangeable for other New Junior Subordinated Debentures of
like tenor, of any authorized denominations, and of a like aggregate principal
amount.
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New Junior Subordinated Debentures may be presented for exchange as
provided above, and may be presented for registration of transfer (with the form
of transfer endorsed thereon, or a satisfactory written instrument of transfer,
duly executed), at the office of the securities registrar appointed under the
Indenture or at the office of any transfer agent designated by the Company for
such purpose without service charge and upon payment of any taxes and other
governmental charges as described in the Indenture. The Company has appointed
the Property Trustee as securities registrar under the Indenture. The Company
may at any time designate additional transfer agents with respect to the New
Junior Subordinated Debentures.
In the event of any redemption, neither the Company nor the Property
Trustee shall be required to (i) issue, register the transfer of or exchange New
Junior Subordinated Debentures during a period beginning at the opening of
business 15 days before the day of selection for redemption of the New Junior
Subordinated Debentures to be redeemed and ending at the close of business on
the day of mailing of the relevant notice of redemption or (ii) transfer or
exchange any New Junior Subordinated Debentures so selected for redemption,
except, in the case of any New Junior Subordinated Debentures being redeemed in
part, any portion thereof not to be redeemed.
Any monies deposited with the Property Trustee or any paying agent, or then
held by the Company in trust, for the payment of the principal of (and premium,
if any) or interest on any New Junior Subordinated Debenture and remaining
unclaimed for two years after such principal (and premium, if any) or interest
has become due and payable shall, at the request of the Company, be repaid to
the Company and the holder of such New Junior Subordinated Debenture shall
thereafter look, as a general unsecured creditor, only to the Company for
payment thereof.
Restrictions on Certain Payments; Certain Covenants of the Company
The Company has covenanted in the Junior Subordinated Indenture that it
will not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Company's capital stock 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 in all respects with or junior in interest to the
New Junior Subordinated Debentures (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or shareholder stock purchase plan or in
connection with the issuance of capital stock of the Company (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period or
other event referred to below, (b) as a result of an exchange or conversion of
any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any shareholder's rights
plan, or the issuance of rights, stock or other property under any shareholder's
rights plan, or the redemption or repurchase of rights pursuant thereto, or (e)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such stock), if at such time (x) there has
occurred any event (1) of which the Company has actual knowledge that with the
giving of notice or the lapse of time, or both, would constitute a Debenture
Event of Default and (2) that the Company has not taken reasonable steps to
cure, (y) if the New Junior Subordinated Debentures are held by the Issuer
Trust, the Company is in default with respect to its payment of any obligations
under the Guarantee or (z) the Company has given notice of its election of an
Extension Period as provided in the Junior Subordinated Indenture and has not
rescinded such notice, or such Extension Period, or any extension thereof, is
continuing.
The Company has covenanted in the Junior Subordinated Indenture (i) to
continue to hold, directly or indirectly, 100% of the Common Securities,
provided that certain successors that are permitted pursuant to the Junior
Subordinated Indenture may succeed to the Company's ownership of the Common
Securities, (ii) as holder of the Common Securities, not to voluntarily
terminate, windup or liquidate the Issuer Trust, other than (a) in connection
with a distribution of New Junior Subordinated Debentures to the holders of the
Capital Securities in liquidation of the Issuer Trust or (b) in connection with
certain mergers, consolidations or amalgamations permitted by the Trust
Agreement and (iii) to use its reasonable efforts, consistent with the terms and
provisions of the Trust Agreement, to cause the Issuer Trust to continue to be
taxable as a grantor trust for United States federal income tax purposes.
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Modification of Junior Subordinated Indenture
From time to time, the Company and the Debenture Trustee may, without the
consent of any of the holders of the outstanding Junior Subordinated Debentures,
amend, waive or supplement the provisions of the Junior Subordinated Indenture
to: (i) evidence succession of another corporation or association to the Company
and the assumption by such person of the obligations of the Company under the
Junior Subordinated Indenture and the Junior Subordinated Debentures; (ii) add
further covenants, restrictions or conditions for the protection of holders of
the Junior Subordinated Debentures, or surrender any right or power conferred
upon the Company by the Junior Subordinated Indenture; (iii) cure ambiguities or
correct or supplement any provision in the Junior Subordinated Debentures in the
case of defects or inconsistencies in the provisions thereof, so long as any
such cure or correction does not adversely affect the interest of the holders of
the Junior Subordinated Debentures or the Capital Securities in any material
respect; (iv) change the terms of the Junior Subordinated Indenture to
facilitate the issuance of the Junior Subordinated Debentures in certificated or
other definitive form; (v) evidence or provide for the appointment under the
Junior Subordinated Indenture of a successor Debenture Trustee; (vi) comply with
the requirements of the Commission to qualify, or maintain the qualification of,
the Junior Subordinated Indenture under the Trust Indenture Act; (vii) convey,
transfer, assign, mortgage or pledge any property to or with the Debenture
Trustee or to surrender any right or power conferred on the Company in the
Junior Subordinated Indenture; (viii) establish the form or terms of any series
of the Junior Subordinated Debentures as permitted by the Junior Subordinated
Indenture; (ix) change or eliminate any provision of the Junior Subordinated
Indenture, so long as at the time of such change there are no outstanding Junior
Subordinated Debentures entitled to the benefit of such provision or such change
does not apply to then outstanding Junior Subordinated Debentures, or (x) add
any additional Debenture Events of Default for the holders of the Junior
Subordinated Debentures. The Junior Subordinated Indenture contains provisions
permitting the Company and the Debenture Trustee, with the consent of the
holders of not less than a majority in principal amount of the Junior
Subordinated Debentures, to modify the Junior Subordinated Indenture in a manner
affecting the rights of the holders of the Junior Subordinated Debentures,
except that no such modification may, without the consent of the holder of each
outstanding Junior Subordinated Debenture so affected, (i) change the Stated
Maturity of the principal of, or any installment of interest on, the Junior
Subordinated Debentures, or reduce the principal amount thereof, the rate of
interest thereon or any premium payable upon the redemption thereof, or change
the place of payment where, or the currency in which, any such amount is payable
or impair the right to institute suit for the enforcement of any Junior
Subordinated Debenture or (ii) reduce the percentage of principal amount of
Junior Subordinated Debentures, the holders of which are required to consent to
any such modification of, or to waive certain matters provided for in, the
Junior Subordinated Indenture. Furthermore, so long as any of the Capital
Securities remain outstanding, no such modification may be made that adversely
affects the holders of such Capital Securities in any material respect, and no
termination of the Junior Subordinated Indenture may occur, and no waiver of any
Debenture Event of Default or compliance with any covenant under the Junior
Subordinated Indenture may be effective, without the prior consent of the
holders of at least a majority of the aggregate Liquidation Amount of the
outstanding Capital Securities unless and until the principal of (and premium,
if any, on) the Junior Subordinated Debentures and all accrued and unpaid
interest thereon have been paid in full and certain other conditions are
satisfied.
Debenture Events of Default
The Junior Subordinated Indenture provides that any one or more of the
following described events with respect to the Junior Subordinated Debentures
that has occurred and is continuing constitutes an "Event of Default" with
respect to the Junior Subordinated Debentures:
(i) failure to pay any interest on the Junior Subordinated Debentures
when 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
(ii) failure to pay any principal of or premium, if any, on the Junior
Subordinated Debentures when due whether at maturity, upon redemption, by
declaration of acceleration or otherwise; or
(iii) failure to observe or perform in any material respect certain
other covenants contained in the Junior Subordinated Indenture for 90 days
after written notice to the Company from the Debenture Trustee or the
holders of at least 25% in aggregate outstanding principal amount of the
outstanding Junior Subordinated Debentures; or
(iv) certain events in bankruptcy, insolvency or reorganization of the
Company.
For purposes of the Trust Agreement and this Prospectus, each such Event of
Default under the Junior Subordinated Indenture is referred to as a "Debenture
Event of Default." As described in "Description of the New Capital Securities --
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Events of Default; Notice," the occurrence of a Debenture Event of Default will
also constitute an Event of Default in respect of the Trust Securities.
The holders of at least a majority in aggregate principal amount of
outstanding Junior Subordinated Debentures 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 not less than 25% in
aggregate principal amount of outstanding Junior Subordinated Debentures may
declare the principal due and payable upon a Debenture Event of Default, and,
should the Debenture Trustee or such holders of Junior Subordinated Debentures
fail to make such declaration, the holders of at least 25% in aggregate
Liquidation Amount of the outstanding Capital Securities shall have such right.
The holders of a majority in aggregate principal amount of outstanding Junior
Subordinated Debentures may annul such declaration and waive the default if all
defaults (other than the non-payment of the principal of Junior Subordinated
Debentures which has become due solely by such acceleration) have been cured or
waived and a sum sufficient to pay all matured installments of interest and
principal due otherwise than by acceleration has been deposited with the
Debenture Trustee. Should the holders of New Junior Subordinated Debentures fail
to annul such declaration and waive such default, the holders of a majority in
aggregate Liquidation Amount of the outstanding Capital Securities shall have
such right.
The holders of at least a majority in aggregate principal amount of the
outstanding Junior Subordinated Debentures affected thereby, and the holders of
a majority in aggregate Liquidation Amount of the Capital Securities issued by
the Issuer Trust, may, on behalf of the holders of all the Junior Subordinated
Debentures, waive any past default, except a default in the payment of principal
(or premium, if any) 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 Junior
Subordinated Indenture cannot be modified or amended without the consent of the
holder of each outstanding Junior Subordinated Debenture affected thereby. See "
- -- Modification of Junior Subordinated Indenture." The Company is required to
file annually with the Debenture Trustee a certificate as to whether or not the
Company is in compliance with all the conditions and covenants applicable to it
under the Junior Subordinated Indenture.
If a Debenture Event of Default occurs and is continuing, the Property
Trustee will have the right to declare the principal of and the interest on the
Junior Subordinated Debentures, and any other amounts payable under the Junior
Subordinated Indenture, to be forthwith due and payable and to enforce its other
rights as a creditor with respect to the Junior Subordinated Debentures.
Enforcement of Certain Rights by Holders of Capital Securities
If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay any amounts payable
in respect of the Junior Subordinated Debentures on the date such amounts are
otherwise payable, a registered holder of Capital Securities may institute a
legal proceeding directly against the Company for enforcement of payment to such
holder of an amount equal to the amount payable in respect of Junior
Subordinated Debentures having a principal amount equal to the aggregate
Liquidation Amount of the Capital Securities held by such holder (a "Direct
Action"). The Company may not amend the Junior Subordinated Indenture to remove
the foregoing right to bring a Direct Action without the prior written consent
of the holders of all the Capital Securities. The Company will have the right
under the Junior Subordinated Indenture to set-off any payment made to such
holder of Capital Securities by the Company in connection with a Direct Action.
With certain exceptions, the holders of the Capital Securities would not be
able to exercise directly any remedies available to the holders of the Junior
Subordinated Debentures except under the circumstances described in the
preceding paragraph. See "Description of the New Capital Securities -- Events of
Default; Notice."
Consolidation, Merger, Sale of Assets and Other Transactions
The Junior Subordinated Indenture provides that the Company may 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
may consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless (i) if
the Company consolidates with or merges into another Person or conveys,
transfers or leases its properties and assets substantially as an entirety to
any Person, the successor Person is organized under the laws of the United
States or any state thereof or the District of Columbia, and such successor
Person expressly assumes the Company's obligations in respect of the New Junior
Subordinated Debentures; (ii) immediately after giving effect thereto, no
Debenture
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Event of Default, and no event which, after notice or lapse of time or both,
would constitute a Debenture Event of Default, has occurred and is continuing;
and (iii) certain other conditions as prescribed in the Junior Subordinated
Indenture are satisfied.
The provisions of the Junior Subordinated Indenture do not afford holders
of the Junior Subordinated Debentures protection in the event of a highly
leveraged or other transaction involving the Company that may adversely affect
holders of the New Junior Subordinated Debentures.
Satisfaction and Discharge
The Junior Subordinated Indenture provides that when, among other things,
all Junior Subordinated Debentures not previously delivered to the Debenture
Trustee for cancellation (i)(a) have become due and payable or (b) will become
due and payable at the Stated Maturity within one year, or (c) are to be called
for redemption within one year under arrangements satisfactory to the Debenture
Trustee, and (ii) the Company deposits or causes to be deposited with the
Debenture Trustee funds, in trust, for the purpose and in an amount sufficient
to pay and discharge the entire indebtedness on the Junior Subordinated
Debentures not previously delivered to the Debenture Trustee for cancellation,
for the principal (and premium, if any) and interest (including any additional
interest) to the date of the deposit or to the Stated Maturity, as the case may
be, then the Junior Subordinated Indenture will, upon the Company's request, be
satisfied and discharged and cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange, certain obligations of
the Company to the Debenture Trustee and the obligations of the Debenture
Trustee to apply money deposited by the Company in payment of the Junior
Subordinated Debentures).
Subordination
The New Junior Subordinated Debentures will be subordinate and junior in
right of payment, to the extent set forth in the Junior Subordinated Indenture,
to all Senior Indebtedness (as defined below) of the Company. If the Company
defaults in the payment of any principal, premium, if any, or interest, if any,
or any other amount payable on any Senior Indebtedness when the same becomes due
and payable, whether at maturity or at a date fixed for redemption or by
declaration of acceleration or otherwise, then, unless and until such default
has been cured or waived or has ceased to exist or all Senior Indebtedness has
been paid, no direct or indirect payment (in cash, property, securities, by
setoff or otherwise) may be made or agreed to be made on the Junior Subordinated
Debentures, or in respect of any redemption, repayment, retirement, purchase or
other acquisition of any of the Junior Subordinated Debentures.
As used herein, "Senior Indebtedness" means, whether recourse is to all or
a portion of the assets of the Company and whether or not contingent, (i) every
obligation of the Company for money borrowed; (ii) every obligation of the
Company evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of the Company with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of the Company; (iv) every obligation of the Company issued or
assumed as the deferred purchase price of property services (but excluding trade
accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of the Company; (vi) every
obligation of the Company for claims (as defined in Section 101(4) of the United
States Bankruptcy Code of 1978, as amended) in respect of derivative products
such as interest and foreign exchange rate contracts, commodity contracts and
similar arrangements; and (vii) every obligation of the type referred to in
clauses (i) through (vi) of another person the payment of which the Company has
guaranteed or is responsible or liable, directly or indirectly, as obligor or
otherwise. Without limiting the generality of the foregoing, Senior Indebtedness
shall include indebtedness incurred pursuant to the Company's existing $75
million revolving credit facility and its master note program. At March 31,
1998, the Company's Senior Indebtedness aggregated approximately $348.9 million.
See "Risk Factors -- Status of the Company as a Bank Holding Company." "Senior
Indebtedness" shall not include (i) any obligations which, by their terms, are
expressly stated to rank pari passu in right of payment with, or to not be
superior in right of payment to, the Junior Subordinated Debentures, (ii) any
indebtedness 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, (iii) any indebtedness of the
Company to any of its subsidiaries, (iv) indebtedness to any executive officer
or director of the Company, or (v) any indebtedness in respect of debt
securities issued to any trust, or a trustee of such trust, partnership or other
entity affiliated with the Company that is a financing entity of the Company in
connection with the issuance of such financing entity of securities that are
similar to the Capital Securities.
In the event of (i) certain events of bankruptcy, dissolution or
liquidation of the Company, (ii) any proceeding for the liquidation, dissolution
or other winding up of the Company, voluntary or involuntary, whether or not
involving insolvency
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or bankruptcy proceedings, (iii) any assignment by the Company for the benefit
of creditors, or (iv) any other marshalling of the assets of the Company, all
Senior Indebtedness (including any interest thereon accruing after the
commencement of any such proceedings) shall first be paid in full before any
payment or distribution, whether in cash, securities or other property, shall be
made on account of the Junior Subordinated Debentures. In such event, any
payment or distribution on account of the Junior Subordinated Debentures,
whether in cash, securities or other property, that would otherwise (but for the
subordination provisions) be payable or deliverable in respect of the Junior
Subordinated Debentures will be paid or delivered directly to the holders of
Senior Indebtedness in accordance with the priorities then existing among such
holders until all Senior Indebtedness (including any interest thereon accruing
after the commencement of any such proceedings) has been paid in full.
In the event of any such proceeding, after payment in full of all sums
owing with respect to Senior Indebtedness, the holders of Junior Subordinated
Debentures, together with the holders of any obligations of the Company ranking
on a parity with the Junior Subordinated Debentures, will be entitled to be paid
from the remaining assets of the Company the amounts at the time due and owing
on the Junior Subordinated Debentures and such other obligations before any
payment or other distribution, whether in cash, property or otherwise, will be
made on account of any capital stock or obligations of the Company ranking
junior to the Junior Subordinated Debentures and such other obligations. If any
payment or distribution on account of the Junior Subordinated Debentures of any
character or any security, whether in cash, securities or other property is
received by any holder of any Junior Subordinated Debentures in contravention of
any of the terms hereof and before all the Senior Indebtedness has been paid in
full, such payment or distribution or security will be received in trust for the
benefit of, and must be paid over or delivered and transferred to, the holders
of the Senior Indebtedness at the time outstanding in accordance with the
priorities then existing among such holders for application to the payment of
all Senior Indebtedness remaining unpaid to the extent necessary to pay all such
Senior Indebtedness in full. By reason of such subordination, in the event of
the insolvency of the Company, holders of Senior Indebtedness may receive more,
ratably, and holders of the Junior Subordinated Debentures may receive less,
ratably, than the other creditors of the Company. Such subordination will not
prevent the occurrence of any Event of Default in respect of the Junior
Subordinated Debentures.
The Junior Subordinated Indenture places no limitation on the amount of
additional Senior Indebtedness that may be incurred by the Company. The Company
expects from time to time to incur additional indebtedness constituting Senior
Indebtedness.
Information Concerning the Debenture Trustee
The Debenture Trustee, other than during the occurrence and continuance of
a Debenture Event of Default, undertakes to perform only such duties as are
specifically set forth in the Junior Subordinated Indenture, is under no
obligation to exercise any of the powers vested in it by the Junior Subordinated
Indenture and, after such Debenture Event of Default, must exercise the same
degree of care and skill as a prudent person would exercise in the conduct of
his or her own affairs. 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.
Bankers Trust Company, the Debenture Trustee, may serve from time to time
as trustee under other indentures or trust agreements with the Company or its
subsidiaries relating to other issues of their securities. In addition, the
Company and certain of its affiliates may have other banking relationships with
Bankers Trust Company and its affiliates.
Restrictions on Transfer
The New Junior Subordinated Debentures will be issued, and may be
transferred only, in blocks having an aggregate principal amount of not less
than $100,000 (100 New Junior Subordinated Debentures). Any such transfer of New
Junior Subordinated Debentures in a block having an aggregate principal amount
of less than $100,000 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 New
Junior Subordinated Debentures for any purpose, including but not limited to the
receipt of payments on such New Junior Subordinated Debentures, and such
transferee shall be deemed to have no interest whatsoever in such New Junior
Subordinated Debentures.
Governing Law
The Junior Subordinated Indenture and the New Junior Subordinated
Debentures will be governed by and construed in accordance with the laws of the
State of New York.
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DESCRIPTION OF THE GUARANTEE
Concurrent with the issuance by the Issuer Trust of the Old Capital
Securities, the Old Guarantee was executed and delivered by the Company for the
benefit of the holders from time to time of the Capital Securities. As soon as
is practicable after the date hereof, the Company will exchange the Guarantee
for the Old Guarantee. This summary of the material provisions of the Guarantee
does not purport to be complete and is subject to, and qualified in its entirety
by reference to, all of the provisions of the Guarantee, including the
definitions therein of certain terms. A copy of the Guarantee is available upon
request from the Guarantee Trustee. The Guarantee Trustee will hold the
Guarantee for the benefit of the holders of the Capital Securities.
General
Pursuant to the Guarantee, the Company will irrevocably agree to pay in
full on a subordinated basis, to the extent set forth herein, the Guarantee
Payments (as defined below) to the holders of the Capital Securities, as and
when due, regardless of any defense, right of set-off or counterclaim that the
Issuer Trust may have or assert other than the defense of payment. The following
payments with respect to the Capital Securities, to the extent not paid by or on
behalf of the Issuer Trust (the "Guarantee Payments"), will be subject to the
Guarantee: (i) any accumulated and unpaid Distributions which are required to be
paid on the Capital Securities, to the extent the Issuer Trust has funds on hand
available therefor at such time; (ii) the Redemption Price with respect to any
Capital Securities called for redemption, to the extent that the Issuer Trust
has funds on hand available therefor at such time; and (iii) upon a voluntary or
involuntary dissolution, winding up or liquidation of the Issuer Trust (unless
the Junior Subordinated Debentures are distributed to holders of the Capital
Securities), the lesser of (a) the aggregate of the Liquidation Amount and all
accumulated and unpaid Distributions to the date of payment, to the extent the
Issuer Trust has funds on hand available therefor at such time, and (b) the
amount of assets of the Issuer Trust remaining available for distribution to
holders of such Capital Securities in liquidation of the Issuer Trust. The
Company's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Company to the holders of the Capital
Securities or by causing the Issuer Trust to pay such amounts to such holders.
The Guarantee will be an irrevocable guarantee on a subordinated basis of
the Issuer Trust's obligations under the Capital Securities, but will apply only
to the extent that the Issuer Trust has funds sufficient to make such payments,
and is not a guarantee of collection.
If the Company does not make payments on the Junior Subordinated Debentures
held by the Issuer Trust, the Issuer Trust will not be able to pay any amounts
payable in respect of the Capital Securities and will not have funds legally
available therefor. The Guarantee will rank subordinate and junior in right of
payment to all Senior Indebtedness of the Company. See " -- Status of the
Guarantee." The Guarantee does not limit the incurrence or issuance of other
secured or unsecured debt of the Company, including Senior Indebtedness, whether
under the Junior Subordinated Indenture, any other indenture that the Company
may enter into in the future or otherwise.
The Company has, through the Guarantee, the Trust Agreement, the Junior
Subordinated Debentures and the Junior Subordinated Indenture, taken together,
fully, irrevocably and unconditionally guaranteed all the Issuer Trust's
obligations under the Capital Securities. No single document standing alone or
operating in conjunction with fewer than all the other documents constitutes
such guarantee. It is only the combined operation of these documents that has
the effect of providing a full, irrevocable and unconditional guarantee of the
Issuer Trust's obligations in respect of the Capital Securities. See
"Relationship Among the Capital Securities, the Junior Subordinated Debentures
and the Guarantee."
Status of the Guarantee
The Guarantee will constitute an unsecured obligation of the Company and
will rank subordinate and junior in right of payment to all Senior Indebtedness
of the Company in the same manner as the Junior Subordinated Debentures.
The Guarantee will constitute a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Guarantor to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity). The
Guarantee will be held by the Guarantee Trustee for the benefit of the holders
of the Capital Securities. The Guarantee will not be discharged except by
payment of the Guarantee Payments in full to the extent not paid by the Issuer
Trust or distribution to the holders of the Capital Securities of the Junior
Subordinated Debentures.
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Amendments and Assignment
Except with respect to any changes which do not materially adversely affect
the rights of holders of the Capital Securities (in which case no vote will be
required), the Guarantee may not be amended without the prior approval of the
holders of not less than a majority of the aggregate Liquidation Amount of the
Capital Securities. The manner of obtaining any such approval will be as set
forth under "Description of the Capital Securities -- Voting Rights; Amendment
of Trust Agreement." All guarantees and agreements contained in the Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Company and shall inure to the benefit of the holders of the Capital
Securities then outstanding.
Events of Default
An event of default under the Guarantee will occur upon the failure of the
Company to perform any of its payment obligations thereunder, or to perform any
non-payment obligation if such non-payment default remains unremedied for 30
days. The holders of not less than a majority in aggregate Liquidation Amount of
the Capital Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under the Guarantee.
Any registered holder of Capital Securities may institute a legal
proceeding directly against the Company to enforce its rights under the
Guarantee without first instituting a legal proceeding against the Issuer Trust,
the Guarantee Trustee or any other person or entity.
The Company, as guarantor, is required to file annually with the Guarantee
Trustee a certificate as to whether or not the Company is in compliance with all
the conditions and covenants applicable to it under the Guarantee.
Information Concerning the Guarantee Trustee
The Guarantee Trustee, other than during the occurrence and continuance of
a default by the Company in performance of the Guarantee, undertakes to perform
only such duties as are specifically set forth in the Guarantee and, after the
occurrence of an event of default with respect to the Guarantee, 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 under no obligation to exercise any of the powers vested in it by the
Guarantee at the request of any holder of the Capital Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby.
For information concerning the relationship between Bankers Trust Company,
the Guarantee Trustee, and the Company, see "Description of the Junior
Subordinated Debentures -- Information Concerning the Debenture Trustee."
Termination of the Guarantee
The Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of the Capital Securities, upon full
payment of the amounts payable with respect to the Capital Securities upon
liquidation of the Issuer Trust or upon distribution of Junior Subordinated
Debentures to the holders of the Capital Securities. The Guarantee will continue
to be effective or will be reinstated, as the case may be, if at any time any
holder of the Capital Securities must restore payment of any sums paid under the
Capital Securities or the Guarantee.
Governing Law
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
RELATIONSHIP AMONG THE CAPITAL SECURITIES, THE
JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
Full and Unconditional Guarantee
Payments of Distributions and other amounts due on the Capital Securities
(to the extent the Issuer Trust has funds available for such payment) are
irrevocably guaranteed by the Company as and to the extent set forth under
"Description of the Guarantee." Taken together, the Company's obligations under
the Junior Subordinated Debentures, the Junior Subordinated Indenture, the Trust
Agreement and the Guarantee provide, in the aggregate, a full, irrevocable and
unconditional guarantee of payments of Distributions and other amounts due on
the Capital Securities. No single document standing alone or operating in
conjunction with fewer than all the other documents constitutes such guarantee.
It is only the combined operation of these documents that has the effect of
providing a full, irrevocable and unconditional guarantee of the Issuer
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Trust's obligations in respect of the Capital Securities. If and to the extent
that the Company does not make payments on the Junior Subordinated Debentures,
the Issuer Trust will not have sufficient funds to pay Distributions or other
amounts due on the Capital Securities. The Guarantee does not cover payment of
amounts payable with respect to the Capital Securities when the Issuer Trust
does not have sufficient funds to pay such amounts. In such event, the remedy of
a holder of the Capital Securities is to institute a legal proceeding directly
against the Company for enforcement of payment of the Company's obligations
under Junior Subordinated Debentures having a principal amount equal to the
Liquidation Amount of the Capital Securities held by such holder.
The obligations of the Company under the Junior Subordinated Debentures and
the Guarantee are subordinate and junior in right of payment to all Senior
Indebtedness.
Sufficiency of Payments
As long as payments are made when due on the Junior Subordinated
Debentures, such payments will be sufficient to cover Distributions and other
payments distributable on the Capital Securities, primarily because: (i) the
aggregate principal amount of the Junior Subordinated Debentures will be equal
to the sum of the aggregate stated Liquidation Amount of the Capital Securities
and Common Securities; (ii) the interest rate and interest and other payment
dates on the Junior Subordinated Debentures will match the Distribution rate,
Distribution Dates and other payment dates for the Capital Securities; (iii) the
Company will pay for all and any costs, expenses and liabilities of the Issuer
Trust except the Issuer Trust's obligations to holders of the Trust Securities;
and (iv) the Trust Agreement further provides that the Issuer Trust will not
engage in any activity that is not consistent with the limited purposes of the
Issuer Trust.
Notwithstanding anything to the contrary in the Junior Subordinated
Indenture, the Company has the right to set-off any payment it is otherwise
required to make thereunder against and to the extent the Company has
theretofore made, or is concurrently on the date of such payment making, a
payment under the Guarantee.
Enforcement Rights of Holders of Capital Securities
A holder of any Capital Security may institute a legal proceeding directly
against the Company to enforce its rights under the Guarantee without first
instituting a legal proceeding against the Guarantee Trustee, the Issuer Trust
or any other person or entity. See "Description of the Guarantee."
A default or event of default under any Senior Indebtedness of the Company
would not constitute a default or Event of Default in respect of the Capital
Securities. However, in the event of payment defaults under, or acceleration of,
Senior Indebtedness of the Company, the subordination provisions of the Junior
Subordinated Indenture provide that no payments may be made in respect of the
Junior Subordinated Debentures until such Senior Indebtedness has been paid in
full or any payment default thereunder has been cured or waived. See
"Description of the New Subordinated Debentures -- Subordination."
Limited Purpose of Issuer Trust
The Capital Securities represent preferred undivided beneficial interests
in the assets of the Issuer Trust, and the Issuer Trust exists for the sole
purpose of issuing its Capital Securities and Common Securities and investing
the proceeds thereof in Junior Subordinated Debentures. A principal difference
between the rights of a holder of a Capital Security and a holder of a Junior
Subordinated Debenture is that a holder of a Junior Subordinated Debenture is
entitled to receive from the Company payments on Junior Subordinated Debentures
held, while a holder of Capital Securities is entitled to receive Distributions
or other amounts distributable with respect to the Capital Securities from the
Issuer Trust (or from the Company under the Guarantee) only if and to the extent
the Issuer Trust has funds available for the payment of such Distributions.
Rights Upon Dissolution
Upon any voluntary or involuntary dissolution of the Issuer Trust, other
than any such dissolution involving the distribution of the Junior Subordinated
Debentures, after satisfaction of liabilities to creditors of the Issuer Trust
as required by applicable law, the holders of the Capital Securities will be
entitled to receive, out of assets held by the Issuer Trust, the Liquidation
Distribution in cash. See "Description of the New Capital Securities --
Liquidation Distribution Upon Dissolution." Upon any voluntary or involuntary
liquidation or bankruptcy of the Company, the Issuer Trust, as registered holder
of the Junior Subordinated Debentures, would be a subordinated creditor of the
Company, subordinated and junior in right of payment to all Senior Indebtedness
as set forth in the Junior Subordinated Indenture, but entitled to receive
payment in full of all amounts payable with respect to the Junior Subordinated
Debentures before any shareholders of the Company
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receive payments or distributions. Since the Company is the guarantor under the
Guarantee and has agreed under the Junior Subordinated Indenture to pay for all
costs, expenses and liabilities of the Issuer Trust (other than the Issuer
Trust's obligations to the holders of the Trust Securities), the positions of a
holder of the Capital Securities and a holder of such Junior Subordinated
Debentures relative to other creditors and to shareholders of the Company in the
event of liquidation or bankruptcy of the Company are expected to be
substantially the same.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
General
The following is a summary of the principal United States federal income
tax consequences of the purchase, ownership and disposition of Capital
Securities. The statements of law and legal conclusions set forth in this
summary regarding the tax consequences to the beneficial owners of Capital
Securities (the "Securityholders") represent the opinion of Hunton & Williams,
Richmond, Virginia, special tax counsel to the Company. This summary does not
address all tax consequences that may be applicable to a Securityholder, nor
does it address the tax consequences to (i) persons that may be subject to
special treatment under United States federal income tax law, such as banks,
insurance companies, thrift institutions, regulated investment companies, real
estate investment trusts, tax-exempt organizations and dealers in securities or
currencies, (ii) persons that will hold Capital Securities as part of a position
in a "straddle" or as part of a "hedging," "conversion" or other integrated
investment transaction for federal income tax purposes, (iii) except with
respect to the discussion under the caption "United States Alien
Securityholders," persons whose functional currency is not the United States
dollar or (iv) persons that do not hold Capital Securities as capital assets.
This summary is based on the Code, Treasury Regulations, Internal Revenue
Service (the "IRS") rulings and pronouncements and judicial decisions now in
effect, all of which are subject to change at any time. Such changes may be
applied retroactively in a manner that could cause the tax consequences to vary
substantially from the consequences described below, possibly adversely
affecting a beneficial owner of Capital Securities. In addition, the authorities
on which this summary is based (including authorities distinguishing debt from
equity) are subject to various interpretations, and it is therefore possible
that the federal income tax treatment of the Capital Securities may differ from
the treatment described below. No ruling has been received from the IRS
regarding the tax consequences of the Capital Securities. Counsel's opinion
regarding such tax consequences represents only counsel's best legal judgment
based on current authorities and is not binding on the IRS or the courts.
HOLDERS OF CAPITAL SECURITIES ARE ADVISED TO CONSULT WITH THEIR OWN TAX
ADVISORS IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE FEDERAL TAX
CONSEQUENCES OF THE EXCHANGE OFFER, AND THE PURCHASE, OWNERSHIP AND DISPOSITION
OF CAPITAL SECURITIES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX
LAWS.
Classification of the Junior Subordinated Debentures
The Junior Subordinated Debentures are intended to be, in the opinion of
Hunton & Williams should be, and the Company intends to take the position that
the Junior Subordinated Debentures will be, classified for United States federal
income tax purposes as indebtedness under current law. No assurance can be
given, however, the IRS will not challenge that position. According to a
petition recently filed in the United States Tax Court by a corporation
unrelated to the Company and the Issuer Trust, the IRS has challenged the status
as indebtedness, for United States federal income tax purposes, of certain
purported debt instruments held by entities intended to be taxable as
partnerships for United States federal income tax purposes, where those
entities, in turn, issued preferred securities to investors. Although the
overall structure of the financing arrangement involved in that case is somewhat
similar to the financing structure for the Junior Subordinated Debentures and
the Issuer Trust, the relevant facts involved in that case appear to differ
significantly from those relating to the Junior Subordinated Debentures and the
Issuer Trust. The remainder of this summary assumes that the Junior Subordinated
Debentures will be classified as indebtedness for United States federal income
tax purposes.
Exchange of Capital Securities
The exchange of Old Capital Securities for New Capital Securities will not
be a taxable event to Securityholders for United States federal income tax
purposes. Accordingly, the New Capital Securities will have the same issue price
as the Old Capital Securities, and a Securityholder will have the same adjusted
tax basis and holding period for New Capital Securities as the holder had for
Old Capital Securities immediately before the exchange.
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Classification of the Issuer Trust
In the opinion of Hunton & Williams, under current law and assuming
compliance with the terms of the Trust Agreement, the Issuer Trust will be
classified as a grantor trust and not as an association taxable as a corporation
for United States federal income tax purposes. As a result, each Securityholder
will be treated as owning an undivided beneficial interest in the Junior
Subordinated Debentures. Accordingly, each Securityholder will be required to
include in its gross income its pro rata share of the interest, including any
original issue discount ("OID"), and any other income received or accrued with
respect to the Junior Subordinated Debentures whether or not cash is actually
distributed to the Securityholders. See " -- Interest Income and Original Issue
Discount." No amount included in income with respect to the Capital Securities
will be eligible for the dividends received deduction.
Interest Income and Original Issue Discount
Under Treasury Regulations applicable to debt instruments issued after
August 12, 1996 (the "Regulations"), a "remote" contingency that stated interest
will not be timely paid will be ignored in determining whether a debt instrument
is issued with OID. The Company believes that the likelihood of its exercising
its option to defer payments of interest on the Junior Subordinated Debentures
is remote. Based on the foregoing, in the opinion of Hunton & Williams, the
Junior Subordinated Debentures will not be considered to be issued with OID at
the time of their original issuance and, accordingly, a Securityholder should
include in gross income such Securityholder's allocable share of interest on the
Junior Subordinated Debentures (other than an amount of the first interest
payment attributable to pre-issuance accrued interest, which a Securityholder
may treat as a reduction of the issue price of the Junior Subordinated
Debentures rather than as gross income) in accordance with such Securityholder's
method of tax accounting.
Under the Regulations, if the Company should actually exercise its option
to defer any payment of interest, the Junior Subordinated Debentures would at
that time be treated as issued with OID, and all stated interest on the Junior
Subordinated Debentures would thereafter be treated as OID so long as the Junior
Subordinated Debentures remained outstanding. In such event, all of a
Securityholder's taxable interest income with respect to the Junior Subordinated
Debentures would be accounted for as OID on an economic accrual basis regardless
of such Securityholder's method of tax accounting, and actual payments of stated
interest would not be reported as taxable income. Consequently, a Securityholder
would be required to include in gross income OID even though the Company would
not make any cash payments during an Extension Period.
The Regulations have not been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation herein.
Market Discount and Amortizable Premium
A secondary market purchaser of Capital Securities at a discount from the
principal amount (or, if the Junior Subordinated Debentures are deemed to be
issued with OID, the issue price plus accrued but unpaid OID) of the pro rata
share of Junior Subordinated Debentures represented by the Capital Securities
acquires such Capital Securities with "market discount" if the discount is not
less than the product of (i) 0.25% of the principal amount (or, if the Junior
Subordinated Debentures are deemed to be issued with OID, the issue price plus
accrued but unpaid OID) multiplied by (ii) the number of complete years to
maturity of the Junior Subordinated Debentures after the date of purchase. A
purchaser of Capital Securities with market discount generally will be required
to treat any gain on the sale, redemption or other disposition of all or part of
such Capital Securities as ordinary income to the extent of accrued (but not
previously taxable) market discount. Market discount generally will accrue
ratably during the period from the date of purchase to the maturity date, unless
the Securityholder elects to accrue such market discount on the basis of a
constant interest rate. A Securityholder who acquires Capital Securities at a
market discount may be required to defer some interest deductions attributable
to any indebtedness incurred or continue to purchase or carry the Capital
Securities.
A secondary market purchaser of Capital Securities at a premium over the
stated principal amount of the pro rata share of Junior Subordinated Debentures
(plus accrued interest) generally may elect to amortize such premium ("Section
171 premium"), under a constant yield method, as an offset to interest income on
the Junior Subordinated Debentures. If the Junior Subordinated Debentures are
deemed to be issued with OID and Capital Securities are acquired at a premium,
the premium will not be Section 171 premium but will be amortized as a reduction
in the amount of OID includable in the Securityholder's income.
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Distribution of Junior Subordinated Debentures to Holders of Capital Securities
Except as noted below, under current law a distribution by the Issuer Trust
of the Junior Subordinated Debentures as described under the caption
"Description of the New Capital Securities -- Liquidation Distribution Upon
Dissolution," would not be a taxable event to Securityholders for United States
federal income tax purposes; such a distribution would result in a
Securityholder receiving directly its pro rata share of the Junior Subordinated
Debentures previously held indirectly through the Issuer Trust, with a holding
period and aggregate tax basis equal to the holding period and aggregate tax
basis such Securityholder had in its Capital Securities before such
distribution; and a Securityholder would account for interest, market discount
and amortizable premium in respect of Junior Subordinated Debentures received
from the Issuer Trust in the manner described above under " -- Interest Income
and Original Issue Discount" and " -- Market Discount and Amortizable Premium."
If, however, the Junior Subordinated Debentures were distributed in connection
with a Tax Event that would cause the Issuer Trust to be subject to United
States federal income tax with respect to income received or accrued on the
Junior Subordinated Debentures, the distribution likely would be a taxable event
to Securityholders. In that case, Securityholders would recognize gain or loss
equal to the difference between their adjusted bases in their Capital Securities
and the fair market value of the Junior Subordinated Debentures distributed to
the Securityholders, and they would obtain new holding periods and fair market
value bases for such Junior Subordinated Debentures.
Sale or Redemption of Capital Securities
Upon a sale (including redemption) of Capital Securities, a Securityholder
will recognize gain or loss equal to the difference between its adjusted tax
basis in the Capital Securities and the amount realized on the sale of such
Capital Securities (excluding any amount attributable to any accrued interest
with respect to such Securityholder's pro rata share of the Junior Subordinated
Debentures not previously included in income, which will be taxable as ordinary
income). Provided that the Company does not exercise its option to defer payment
of interest on the Junior Subordinated Debentures and the Capital Securities are
not considered to be issued with OID, a Securityholder's adjusted tax basis in
the Capital Securities generally will be its initial purchase price, increased
by any market discount included in income and reduced by any amortized Section
171 premium for such Capital Securities. If the Junior Subordinated Debentures
are deemed to be issued with OID as a result of the Company's deferral of any
interest payment, a Securityholder's tax basis in the Capital Securities
generally will be increased by OID previously includable in such
Securityholder's gross income to the date of disposition and decreased by
distributions or other payments received on the Capital Securities since and
including the commencement date of the first Extension Period. Such gain or
loss, except to the extent of any accrued market discount, generally will be a
long-term capital gain or loss if the Capital Securities have been held for more
than one year.
Should the Company exercise its option to defer any payment of interest on
the Junior Subordinated Debentures, the Capital Securities may trade at a price
that does not accurately reflect the value of accrued but unpaid interest with
respect to the underlying Junior Subordinated Debentures. As a result, and
because a Securityholder will be required to include in income accrued but
unpaid interest on Junior Subordinated Debentures and to add such amount to its
adjusted tax basis, such Securityholder may recognize a capital loss on a sale
of Capital Securities during an Extension Period. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes.
Backup Withholding Tax and Information Reporting
The amount of interest paid and any OID accrued with respect to the Capital
Securities to Securityholders (other than corporations and other exempt
Securityholders) will be reported to the IRS. It is expected that such income on
the Capital Securities will be reported to Securityholders on Form 1099 and
mailed to Securityholders by January 31 following each calendar year. "Backup"
withholding at a rate of 31% will apply to payments of interest and payments of
disposition (including redemption) proceeds to a non-exempt Securityholder
unless the Securityholder furnishes to the payor its taxpayer identification
number, certifies that such number is correct, and meets certain other
conditions. Any amounts withheld from a Securityholder under the backup
withholding rules will be allowable as a refund or a credit against such
Securityholder's United States federal income tax liability.
United States Alien Securityholders
For purposes of this discussion, a United States Alien Securityholder is
any corporation, individual, partnership, estate or trust that for United States
federal income tax purposes is a foreign corporation, non-resident alien
individual, foreign
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partnership, foreign estate or foreign trust. This discussion assumes that
income with respect to the Capital Securities is not effectively connected with
a trade or business in the United States in which the United States Alien
Securityholder is engaged.
Under current United States federal income tax law:
(i) payments by the Issuer Trust or any of its paying agents to any
holder of Capital Securities that is a United States Alien
Securityholder generally will not be subject to withholding or other
United States federal income tax, provided that, in the case of
payments with respect to interest (including OID), (a) the beneficial
owner of the Capital Securities does not actually or constructively own
10% or more of the total combined voting power of all classes of stock
of the Company entitled to vote, (b) the beneficial owner of the
Capital Securities is not a controlled foreign corporation that is
related to the Company through stock ownership, and (c) either (A) the
beneficial owner of the Capital Securities certifies to the Issuer
Trust or its agent, under penalties of perjury, that it is a United
States Alien Securityholder and provides its name and address or (B) a
securities clearing organization, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or
business (a "Financial Institution") and holds the Capital Securities
in such capacity certifies to the Issuer Trust or its agent under
penalties of perjury that such statement has been received from the
beneficial owner by it or by a Financial Institution between it and the
beneficial owner and furnishes the Issuer Trust or its agent with a
copy thereof; and
(ii) a United States Alien Securityholder of Capital Securities
generally will not be subject to withholding or other United States
federal income tax on any gain realized upon the sale or other
disposition of Capital Securities.
Possible Tax Law Changes
In both 1996 and 1997, the Clinton Administration proposed to amend the
Code to deny deductions of interest and original issue discount on instruments
with features similar to those of the Junior Subordinated Debentures when issued
under arrangements similar to the Issuer Trust. That proposal was not passed by,
and is not currently pending before, Congress. There can be no assurance,
however, that future legislative proposals, future regulations or official
administrative pronouncements, or future judicial decisions will not affect the
ability of the Company to deduct interest on the Junior Subordinated Debentures.
Such a change could give rise to a Tax Event, which may permit the Company, upon
approval of the Federal Reserve if then required under applicable capital
guidelines or policies of the Federal Reserve, to cause a redemption of the
Capital Securities, as described more fully under "Description of the New
Capital Securities -- Redemption."
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Capital Securities for its own account
in connection with the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such New Capital Securities. The
Company and the Issuer Trust have agreed that this Prospectus, as it may be
amended or supplemented from time to time, may be used by Participating
Broker-Dealers for a period of ninety (90) days after the Expiration Date
(subject to extension under certain limited circumstances described herein) in
connection with resales of New Capital Securities received in exchange for Old
Capital Securities if such Old Capital Securities were acquired by such
Participating Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities. See "The Exchange Offer -- Resales of
New Capital Securities." Neither the Company nor the Issuer Trust will receive
any cash proceeds from the issuance of the New Capital Securities offered
hereby. New Capital Securities received by broker-dealers for their own accounts
in connection with the Exchange Offer may be sold from time to time in one or
more transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the New Capital Securities or a combination of
such methods of resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices or at negotiated prices. Any
such resale may be made directly to purchasers or to or through brokers or
dealers who may receive compensation in the form of commissions or concessions
from any such broker-dealer and/or the purchasers of any such New Capital
Securities. Any broker-dealer that resells New Capital Securities that were
received by it for its own account in connection with the Exchange Offer and any
broker or dealer that participates in a distribution of such New Capital
Securities may be deemed to be an "underwriter" within the meaning of the
Securities Act, and any profit on any such resale of New Capital Securities and
any commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of Transmittal
states that by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
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For a period of ninety (90) days after the date on which the Exchange Offer
is consummated, the Company and the Issuer Trust will promptly send additional
copies of this Prospectus and any amendment or supplement to this Prospectus to
any broker-dealer that requests such documents in the Letter of Transmittal. The
Company and the Issuer Trust have agreed to pay all expenses incident to the
Exchange Offer (including the expenses of one counsel for the holders of the Old
Capital Securities) other than commissions or concessions of any brokers or
dealers and will indemnify the holders of the Old Capital Securities (including
any broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
CERTAIN ERISA CONSIDERATIONS
Each fiduciary of a pension, profit-sharing or other employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA") (a "Plan"), should consider, among other matters, (a) ERISA's
fiduciary standards (including its prudence and diversification requirements),
(b) whether such fiduciaries have authority to make an investment in the Capital
Securities under the applicable Plan investment policies and governing
instruments, and (c) rules under ERISA and the Code that prohibit Plan
fiduciaries from causing a Plan to engage in a "prohibited transaction."
Section 406 of ERISA and Section 4975 of the Code prohibit Plans, as well
as individual retirement accounts and Keogh plans subject to Section 4975 of the
Code (also "Plans"), from engaging in certain transactions involving "plan
assets" with persons who are "parties in interest" under ERISA or "disqualified
persons" under the Code ("Parties in Interest") with respect to such Plan. A
violation of these "prohibited transaction" rules may result in an excise tax or
other liabilities under ERISA and/or Section 4975 of the Code for such persons,
unless exemptive relief is available under an applicable statutory or
administrative exemption. Employee benefit plans that are governmental plans (as
defined in Section 3(32) of ERISA), certain church plans (as defined in Section
3(33) of ERISA) and foreign plans (as described in Section 4(b)(4) of ERISA) are
not subject to the requirements of ERISA or Section 4975 of the Code.
The U.S. Department of Labor (the "DOL") has issued a regulation (29 C.F.R.
[00a7]2510.3-101) (the "Plan Assets Regulation") concerning the definition of
what constitutes the assets of a Plan. The Plan Assets Regulation provides that,
as a general rule, the underlying assets and properties of corporations,
partnerships, trusts and certain other entities in which a Plan makes an
"equity" investment will be deemed, for purposes of ERISA, to be assets of the
investing Plan unless certain exceptions apply.
Pursuant to an exception contained in the Plan Assets Regulation, the
assets of the Issuer Trust would not be deemed to be "plan assets" of investing
Plans if, immediately after the most recent acquisition of any equity interest
in the Issuer Trust, less than 25% of the value of each class of equity
interests in the Issuer Trust were held by Plans, other employee benefit plans
not subject to ERISA or Section 4975 of the Code (such as governmental, church
and foreign plans), and entities holding assets deemed to be "plan assets" of
any Plan (collectively, "Benefit Plan Investors"). No assurance can be given
that the value of the Capital Securities held by Benefit Plan Investors will be
less than 25% of the total value of such Capital Securities, and no monitoring
or other measures will be taken with respect to the satisfaction of the
conditions to this exception. All of the Common Securities will be purchased and
held by the Company.
Under another exception contained in the Plan Assets Regulation, if New
Capital Securities received as a result of the Exchange Offer were to qualify as
"publicly offered securities" under the Plan Assets Regulation, the assets of
the Issuer Trust would not be deemed to be "plan assets" by reason of a Plan's
acquisition or holding of such securities. The New Capital Securities would
qualify as "publicly offered securities" if, among other things, they are
offered pursuant to an effective registration statement, are owned by 100 or
more investors independent of the issuer and each other at the time of the
offering, and are subsequently registered under the Exchange Act. It is expected
that the 100 investor requirement will not be satisfied and that the New Capital
Securities will not be registered under the Exchange Act. However, the New
Capital Securities are being offered pursuant to an effective Registration
Statement.
In the event that assets of the Issuer Trust are considered assets of an
investing Plan, the Trustees, the Company, and/or other persons, in providing
services with respect to the Junior Subordinated Debentures, could be considered
fiduciaries to such Plan and subject to the fiduciary responsibility provisions
of Title I of ERISA. In addition, certain transactions involving the Issuer
Trust and/or the Capital Securities could be deemed to constitute direct or
indirect prohibited transactions under ERISA and Section 4975 of the Code with
respect to a Plan if the Capital Securities were acquired with "plan assets" of
such Plan and assets of the Issuer Trust were deemed to be "plan assets" of
Plans investing in the Issuer Trust. For example, if the Company is a Party in
Interest with respect to an investing Plan (either directly or by reason of its
ownership of the Banks), extensions of credit between the Company and the Issuer
Trust (as represented by the Subordinated Debentures and the Guarantees) would
likely be prohibited by Section 406(a)(1)(B) of ERISA and Section 4975(c)(1)(B)
of the Code, unless exemptive relief were available under an applicable
exemption (see below).
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The DOL has issued five prohibited transaction class exemptions ("PTCEs")
that may provide exemptive relief for direct or indirect prohibited transactions
resulting from the purchase or holding of the Capital Securities, assuming that
assets of the Issuer Trust were deemed to be "plan assets" of Plans investing in
the Issuer Trust (see above). Those class exemptions are PTCE 96-23 (for certain
transactions determined by in-house asset managers), PTCE 95-60 (for certain
transactions involving insurance company general accounts), PTCE 91-38 (for
certain transactions involving bank collective investment funds), PTCE 90-1 (for
certain transactions involving insurance company pooled separate accounts), and
PTCE 84-14 (for certain transactions determined by independent qualified asset
managers).
Because of ERISA's prohibitions and those of Section 4975 of the Code, the
Capital Securities may not be purchased or held by any Plan, any entity whose
underlying assets include "plan assets" by reason of any Plan's investment in
the entity (a "Plan Asset Entity") or any person investing "plan assets" of any
Plan, unless such purchase or holding is covered by the exemptive relief
provided by PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or another applicable
exemption. If a purchaser or holder of the Capital Securities that is a Plan or
a Plan Asset Entity elects to rely on an exemption other than PTCE 96-23, 95-60,
91-38, 90-1 or 84-14, the Company and the Issuer Trust may require a
satisfactory opinion of counsel or other evidence with respect to the
availability of such exemption for such purchase and holding. Any purchaser or
holder of the Capital Securities or any interest therein that is a Plan or a
Plan Asset Entity or is purchasing such securities on behalf of or with "plan
assets" will be deemed to have represented by its purchase and holding thereof
that either (a) the purchase and holding of the Capital Securities is covered by
the exemptive relief provided by PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or
another applicable exemption, (b) the Company and the Administrators are not
"fiduciaries," within the meaning of Section 3(21) of ERISA and the regulations
thereunder, with respect to its interest in the Capital Securities or the Junior
Subordinated Debentures, and (c) in purchasing the Capital Securities, it
approves the purchase and holding of the Junior Subordinated Debentures and the
appointment and retention of the Issuer Trustees.
Insurance companies should note that the Small Business Job Protection Act
of 1986 added new Section 401(c) of ERISA relating to the status of the assets
of insurance company general accounts under ERISA and Section 4975 of the Code.
Pursuant to Section 401(cx), the Department of Labor issued proposed regulations
(the "Proposed General Accounting Regulations") in December 1997 with respect to
insurance policies that are supported by an insurer's general account. The
Proposed General Accounting Regulations are intended to provide guidance on
which assets held by the insurer constitute "plan assets" of an ERISA Plan for
purposes of the fiduciary responsibility provisions of ERISA and Section 4975 of
the Code.
Due to the complexity of these rules and the penalties that may be imposed
upon persons involved in non-exempt prohibited transactions, it is particularly
important that fiduciaries or other persons considering purchasing the Capital
Securities on behalf of or with "plan assets" of any Plan, or any plans or other
entities whose assets include Plan assets subject to ERISA or Section 4975 of
the Code, consult with their counsel regarding the potential consequences if the
assets of the Issuer Trust were deemed to be "plan assets" and the availability
of exemptive relief under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.
Governmental plans and certain church plans are not subject to ERISA and
are also not subject to the prohibited transaction provisions of Section 4975 of
the Code. However, state laws or regulations governing the investment and
management of the assets of such plans may contain fiduciary and prohibited
transaction provisions similar to those under ERISA and the Code discussed
above. Accordingly, fiduciaries of governmental plans and church plans, in
consultation with their advisers, should consider the impact of their respective
state laws on investments in the Capital Securities, and the considerations
discussed above, to the extent applicable.
SUPERVISION, REGULATION AND OTHER MATTERS
The following information is not intended to be an exhaustive description
of the statutes and regulations applicable to the Company or the Banks. The
discussion is qualified in its entirety by reference to all particular statutory
or regulatory provisions. Additional information regarding supervision and
regulation is included in the documents filed by the Company with the Commission
or incorporated herein by reference. See "Available Information" and
"Incorporation of Certain Documents by Reference."
The business and operations of the Company and the Banks are subject to
extensive federal and state governmental regulation and supervision.
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Regulation of the Company
The Company is a bank holding company registered with the Federal Reserve
under the Bank Holding Company Act of 1956, as amended (the "BHCA"), and is
subject to supervision and examination by, and the regulations and reporting
requirements of, the Federal Reserve. Under the BHCA, the activities of the
Company are limited to banking, managing or controlling banks or engaging in any
other activity which the Federal Reserve determines to be so closely related to
banking or managing or controlling banks as to be a proper incident thereto.
The BHCA prohibits the Company from acquiring direct or indirect control of
more than 5.0% of the outstanding voting stock or substantially all of the
assets of any financial institution, or merging or consolidating with another
bank holding company or savings bank holding company, without prior approval of
the Federal Reserve. Additionally, the BHCA prohibits the Company from engaging
in, or acquiring ownership or control of more than 5.0% of the outstanding
voting stock of any company engaged in, a nonbanking activity unless such
activity is determined by the Federal Reserve to be so closely related to
banking as to be a proper incident thereto. In approving an application by the
Company to engage in a nonbanking activity, the Federal Reserve must consider
whether that activity can reasonably be expected to produce benefits to the
public, such as greater convenience, increased competition or gains in
efficiency, that outweigh possible adverse effects, such as undue concentration
of resources, decreased or unfair competition, conflicts of interest or unsound
banking practices.
There are a number of obligations and restrictions imposed by law on a bank
holding company and its insured depository institution subsidiaries that are
designed to minimize potential loss to depositors and the FDIC insurance funds.
For example, if a bank holding company's insured depository institution
subsidiary becomes "undercapitalized," the bank holding company is required to
guarantee (subject to certain limits) the subsidiary's compliance with the terms
of any capital restoration plan filed with its appropriate federal banking
agency. Also, a bank holding company is required to serve as a source of
financial strength to its depository institution subsidiaries and to commit
resources to support such institutions in circumstances where it might not do
so, absent such policy. Under the BHCA, the Federal Reserve has the authority to
require a bank holding company to terminate any activity or to relinquish
control of a nonbank subsidiary upon the Federal Reserve's determination that
such activity or control constitutes a serious risk to the financial soundness
and stability of a depository institution subsidiary of the bank holding
company.
Regulation of the Banks
As a North Carolina-chartered bank that is not a member of the Federal
Reserve System, FCB/NC's primary federal bank regulator is the Federal Deposit
Insurance Corporation (the "FDIC"). FCB/WV also is a state-chartered bank but is
a member of the Federal Reserve System, so its primary federal bank regulator is
the Federal Reserve. As a federally-chartered savings bank, ASB's primary
federal bank regulator is the Office of Thrift Supervision ("OTS"). The deposits
of each of the Banks are insured by the FDIC. Each of the Banks is subject to
supervision and examination by, and the regulations and reporting requirements
of, its primary federal bank regulator and, in the case of FCB/NC and FCB/WV, by
the respective Commissioner of Banks in North Carolina and West Virginia
(collectively, the "Commissioners").
As insured institutions, the Banks are prohibited from engaging as a
principal in activities that are not permitted for national banks unless (i) the
FDIC determines that the activity would pose no significant risk to the
appropriate deposit insurance fund and (ii) the institution is, and continues to
be, in compliance with all applicable capital standards. Insured institutions
also are prohibited from directly acquiring or retaining any equity investment
of a type or in an amount not permitted for national banks.
The Federal Reserve, the FDIC, the OTS and the Commissioners all have broad
powers to enforce laws and regulations applicable to the Company and the Banks
and to require corrective action of conditions affecting the safety and
soundness of the Banks. Among others, these powers include cease and desist
orders, the imposition of civil penalties and the removal of officers and
directors.
Payment of Dividends
The Company is a legal entity separate and distinct from the Banks. The
principal sources of cash flow of the Company, including cash flow to pay
dividends to its shareholders, are dividends it receives from the Banks. There
are statutory and regulatory limitations on the payment of dividends by the
Banks to the Company, as well as by the Company to its shareholders. As insured
depository institutions, each of the Banks also is prohibited from making
capital distributions, including the payment of dividends, if, after making such
distribution, it would become "undercapitalized" (as such term is defined in the
Federal Deposit Insurance Act).
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If, in the opinion of the federal bank regulatory agencies, a depository
institution under their jurisdiction is engaged in or is about to engage in an
unsafe or unsound practice (which, depending on the financial condition of the
depository institution, could include the payment of dividends), they may
require, after notice and hearing, that such institution cease and desist from
such practice. The federal banking agencies have indicated that paying dividends
that deplete a depository institution's capital base to an inadequate level
would be an unsafe and unsound banking practice. Under current federal law, a
depository institution may not pay any dividend if payment would cause it to
become undercapitalized or if it already is undercapitalized. See " -- Prompt
Corrective Action." Moreover, the federal agencies have issued policy statements
which provide that bank holding companies and insured banks should generally
only pay dividends out of current operating earnings.
At March 31, 1998, approximately $381.7 million was available for payment
of dividends to the Company from the Banks without regulatory approval.
The payment of dividends by the Company and the Banks may also be affected
or limited by other factors, such as the requirement to maintain adequate
capital above regulatory guidelines.
Capital Adequacy
The Company and the Banks are required to comply with the capital adequacy
standards established by the Federal Reserve in the case of the Company, and the
FDIC, the Federal Reserve and the OTS, respectively, in the case of the Banks.
There are two basic measures of capital adequacy for bank holding companies that
have been promulgated by the Federal Reserve and each of the federal bank
regulatory agencies: a risk-based measure and a leverage measure. All applicable
capital standards must be satisfied for a bank holding company to be considered
in compliance.
The minimum guideline for the ratio ("Total Capital Ratio") of total
capital ("Total Capital") to risk-weighted assets (including certain
off-balance-sheet items, such as standby letters of credit) is 8.0%. At least
half of Total Capital must be composed of common equity, undivided profits,
minority interests in the equity accounts of consolidated subsidiaries,
qualifying noncumulative perpetual preferred stock, and a limited amount of
cumulative perpetual preferred stock, less goodwill and certain other intangible
assets ("Tier 1 Capital"). The remainder may consist of certain subordinated
debt, certain hybrid capital instruments and other qualifying preferred stock,
and a limited amount of loan loss reserves ("Tier 2 Capital"). At March 31,
1998, the Company's consolidated Total Capital Ratio and its ratio of Tier 1
Capital to risk-weighted assets ("Tier 1 Capital Ratio") were 11.44% and 10.20%,
respectively, and FCB/NC's, FCB/WV's and ASB's consolidated Total Capital and
Tier 1 Capital Ratios were 11.37% and 10.11%, 21.12% and 19.85%, and 68.69% and
68.24%, respectively.
In addition, the Federal Reserve has established minimum leverage ratio
guidelines for bank holding companies. These guidelines provide for a minimum
ratio (the "Leverage Capital Ratio") of Tier 1 Capital to average assets, less
goodwill and certain other intangible assets, of 3.0% for bank holding companies
that meet certain specified criteria, including having the highest regulatory
rating. All other bank holding companies generally are required to maintain an
additional cushion of 100 to 200 basis points above the stated minimums. The
guidelines also provide that bank holding companies experiencing internal growth
or making acquisitions will be expected to maintain strong capital positions
substantially above the minimum supervisory levels without significant reliance
on intangible assets. Furthermore, the Federal Reserve has indicated that it
will consider a "tangible Leverage Ratio" (deducting all intangibles) and other
indicia of capital strength in evaluating proposals for expansion or new
activities. At March 31, 1998, the Company's Leverage Capital Ratio was 6.95%,
and FCB/NC's, FCB/WV's and ASB's Leverage Capital Ratios were 6.93%, 10.41% and
34.99%, respectively.
The Banks are subject to risk-based and leverage capital requirements
adopted by the FDIC, the Federal Reserve and the OTS which are substantially
similar to those adopted by the Federal Reserve for bank holding companies. Each
of the Banks was in compliance with applicable minimum capital requirements as
of March 31, 1998. Neither the Company nor either of the Banks has been advised
by any federal banking agency of any specific minimum capital ratio requirement
applicable to it.
Failure to meet capital guidelines could subject a bank to a variety of
enforcement remedies, including issuance of a capital directive, the termination
of deposit insurance by the FDIC, a prohibition on the taking of brokered
deposits, and certain other restrictions on its business. As described below,
substantial additional restrictions can be imposed upon FDIC-insured depository
institutions that fail to meet applicable capital requirements. See " -- Prompt
Corrective Action."
The Federal Reserve, the FDIC and the OTS also consider interest rate risk
(when the interest rate sensitivity of an institution's assets does not match
the sensitivity of its liabilities or its off-balance-sheet position) in the
evaluation of a
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bank's capital adequacy. The bank regulatory agencies' methodology for
evaluating interest rate risk requires banks with excessive interest rate risk
exposure to hold additional amounts of capital against such exposures.
Prompt Corrective Action
Current federal law establishes a system of prompt corrective action to
resolve the problems of undercapitalized institutions. Under this system, which
became effective in December 1992, the federal banking regulators are required
to establish five capital categories (well capitalized, adequately capitalized,
undercapitalized, significantly undercapitalized, and critically
undercapitalized) and to take certain mandatory supervisory actions, and are
authorized to take other discretionary actions, with respect to institutions in
the three undercapitalized categories The severity of such actions taken will
depend upon the capital category in which the institution is placed. Generally,
subject to a narrow exception, current federal law requires the banking
regulators to appoint a receiver or conservator for an institution that is
critically undercapitalized.
Under the final agency rules implementing the prompt corrective action
provisions, an institution that (i) has a Total Capital Ratio of 10% or greater,
a Tier 1 Capital Ratio of 6.0% or greater, and a Leverage Ratio of 5.0% or
greater, and (ii) is not subject to any written agreement, order, capital
directive, or prompt corrective action directive issued by the appropriate
federal banking agency, is deemed to be well capitalized. An institution with a
Total Capital Ratio of 8.0% or greater, a Tier 1 Capital Ratio of 4.0% or
greater, and a Leverage Ratio of 4.0% or greater, is considered to be adequately
capitalized. A depository institution that has a Total Capital Ratio of less
than 8.0%, a Tier 1 Capital Ratio of less than 4.0%, or a Leverage Ratio of less
than 4.0%, is considered to be undercapitalized. A depository institution that
has a Total Capital Ratio of less than 6.0%, a Tier 1 Capital Ratio of less than
3.0%, or a Leverage Ratio of less than 3.0%, is considered to be significantly
undercapitalized, and an institution that has a tangible equity capital to
assets ratio equal to or less than 2.0% is deemed to be critically
undercapitalized. For purposes of the regulation, the term "tangible equity"
includes core capital elements counted as Tier 1 Capital for purposes of the
risk-based capital standards, plus the amount of outstanding cumulative
perpetual preferred stock (including related surplus), minus all intangible
assets with certain exceptions. A depository institution may be deemed to be in
a capitalization category that is lower than is indicated by its actual capital
position if it receives an unsatisfactory examination rating.
An institution that is categorized as undercapitalized, significantly
under-capitalized, or critically undercapitalized is required to submit an
acceptable capital restoration plan to its appropriate federal banking agency. A
bank holding company must guarantee that a subsidiary depository institution
meets its capital restoration plan, subject to certain limitations. The
obligation of a controlling bank holding company to fund a capital restoration
plan is limited to the lesser of 5.0% of an undercapitalized subsidiary's assets
or the amount required to meet regulatory capital requirements. An
undercapitalized institution is also generally prohibited from increasing its
average total assets, making acquisitions, establishing any branches, or
engaging in any new line of business, except in accordance with an accepted
capital restoration plan or with the approval of the FDIC. In addition, the
appropriate federal banking agency is given authority with respect to any
undercapitalized depository institution to take any of the actions it is
required to or may take with respect to a significantly undercapitalized
institution as described below if it determines "that those actions are
necessary to carry out the purpose" of the law.
At March 31, 1998, each of the Banks had the requisite capital levels to
qualify as well capitalized.
Reserve Requirements
Pursuant to regulations of the Federal Reserve, all FDIC-insured depository
institutions must maintain average daily reserves against their transaction
accounts. No reserves are required to be maintained on the first $4.3 million of
transaction accounts, and reserves equal to 3.0% must be maintained on the next
$52.0 million of transaction accounts, plus reserves equal to 10.0% on the
remainder. These percentages are subject to adjustment by the Federal Reserve.
Because required reserves must be maintained in the form of vault cash or in a
non-interest-bearing account at a Federal Reserve Bank, the effect of the
reserve requirement is to reduce the amount of the institution's
interest-earning assets. As of March 31, 1998, each of the Banks met its reserve
requirements.
FDIC Insurance Assessments
The FDIC currently uses a risk-based assessment system that takes into
account the risks attributable to different categories and concentrations of
assets and liabilities for purposes of calculating deposit insurance assessments
to be paid by insured depository institutions. The risk-based assessment system,
which went into effect on January 1, 1994, assigns an institution to one of
three capital categories: (i) well capitalized; (ii) adequately capitalized; and
(iii) undercapitalized. These three categories are substantially similar to the
prompt corrective action categories described above, with the "undercapitalized"
category including institutions that are undercapitalized, significantly
undercapitalized, and critically undercapitalized
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for prompt corrective action purposes. An institution is also assigned by the
FDIC to one of three supervisory subgroups within each capital group. The
supervisory subgroup to which an institution is assigned is based on a
supervisory evaluation provided to the FDIC by the institution's primary federal
regulator and information which the FDIC determines to be relevant to the
institution's financial condition and the risk posed to the deposit insurance
funds (which may include, if applicable, information provided by the
institution's state supervisor). An institution's insurance assessment rate is
then determined based on the capital category and supervisory category to which
it is assigned. Under the final risk-based assessment system, there are nine
assessment risk classifications (i.e., combinations of capital groups and
supervisory subgroups) to which different assessment rates are applied.
In 1996, the FDIC imposed a special one-time assessment of approximately
65.7 basis points (0.657%) on a depository institution's assessable deposits
insured by the Savings Association Insurance Fund ("SAIF") held as of March 31,
1995 (or approximately 52.6 basis points on SAIF deposits acquired by banks in
certain qualifying transactions), and adopted revisions to the assessment rate
schedules that would generally eliminate the disparity between assessment rates
applicable to the deposits insured by the Bank Insurance Fund ("BIF") and the
SAIF. The Company anticipates that the net effect of the decrease in the premium
assessment rate on SAIF deposits will result in a reduction in the Banks' total
deposit insurance premium assessments through 1999 as compared to years prior to
1997, assuming no further changes in announced premium assessment rates. The
Company recorded a charge against earnings for the special assessment in 1996 in
the pre-tax amount of approximately $10.0 million.
Under the Federal Deposit Insurance Act, insurance of deposits may be
terminated by the FDIC upon a finding that the institution has engaged in unsafe
and unsound practices, is in an unsafe or unsound condition to continue
operations, or has violated any applicable law, regulation, rule, order, or
condition imposed by the FDIC.
Community Reinvestment
Under the Community Reinvestment Act ("CRA"), as implemented by regulations
of the federal bank regulatory agencies, an insured institution has a continuing
and affirmative obligation consistent with its safe and sound operation to help
meet the credit needs of its entire community, including low and moderate income
neighborhoods. The CRA does not establish specific lending requirements or
programs for financial institutions nor does it limit an institution's
discretion to develop the types of products and services that it believes are
best suited to its particular community, consistent with the CRA. The CRA
requires the federal bank regulatory agencies, in connection with their
examination of insured institutions, to assess the institutions' records of
meeting the credit needs of their communities, using the ratings of
"outstanding," "satisfactory," "needs to improve," or "substantial
noncompliance," and to take that record into account in its evaluation of
certain applications by those institutions. All institutions are required to
make public disclosure of their CRA performance ratings. FCB/NC received an
"outstanding" rating in its last CRA examination.
On May 4, 1995, the federal bank regulatory agencies adopted new uniform
CRA regulations that provide guidance to financial institutions on their CRA
obligations and the methods by which those obligations will be assessed and
enforced. The regulations establish three tests applicable to the Banks: (i) a
lending test to evaluate direct lending in low-income areas and indirect lending
to groups that specialize in community lending; (ii) a service test to evaluate
their delivery of services to such areas, and (iii) an investment test to
evaluate their investment in programs beneficial to such areas. The new CRA
regulations became effective on July 1, 1995, but reporting requirements were
not effective until January 1, 1997. Evaluation under the regulations was not
mandatory until July 1, 1997. Each of he Banks believes its current operations
and policies substantially comply with the regulations and therefore no material
changes to operations or policies are expected.
Transactions With Affiliates
Each of the Banks is subject to restrictions imposed by federal law on
extensions of credit to, and certain other transactions with, the Company and
other affiliates and on investments in the stock or other securities thereof.
These restrictions prevent the Company and other affiliates from borrowing from
the Banks unless the loans are secured by specified collateral, and require such
transactions to have terms comparable to terms of arms-length transactions with
third persons. Further, such secured loans and other transactions and
investments by either of the Banks are generally limited in amount as to the
Company and as to any other affiliate to 10.0% of that Bank's capital and
surplus and as to the Company and all other affiliates to an aggregate of 20.0%
of that Bank's capital and surplus. These regulations and restrictions may limit
the Company's ability to obtain funds from the Banks for its cash needs,
including funds for acquisitions and for payment of dividends, interest and
operating expenses. The Banks' ability to extend credit to their directors,
executive officers, and 10.0% stockholders, as well as to entities controlled by
such persons, is governed by the requirements of Sections 22(g) and 22(h) of the
Federal Reserve Act and Regulation O of the Federal Reserve thereunder.
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Interstate Banking and Branching
The BHCA, as amended by the interstate banking provisions of the
Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (the
"Interstate Banking Law"), permits adequately capitalized and managed bank
holding companies to acquire control of the assets of banks in any state.
Acquisitions are subject to antitrust provisions that cap at 10.0% the portion
of the total deposits of insured depository institutions in the United States
that a single bank holding company may control and generally cap at 30.0% the
portion of the total deposits of insured depository institutions in a state that
a single bank holding company may control. Under certain circumstances, states
have the authority to increase or decrease the 30.0% cap, and states may set
minimum age requirements of up to five years on target banks within their
borders.
Beginning June 1, 1997, and subject to certain conditions, the Interstate
Banking Law also permitted interstate branching by allowing a bank to merge with
a bank located in a different state. A state was allowed to accelerate the
effective date for interstate mergers by adopting a law authorizing such
transactions prior to June 1, 1997, or it could "opt out" and thereby prohibit
interstate branching by enacting legislation to that effect prior to that date.
The Interstate Banking Law also permits banks to establish branches in other
states by opening new branches or acquiring existing branches of other banks,
provided the laws of those other states specifically permit that form of
interstate branching. North Carolina and West Virginia each has adopted statutes
which, subject to conditions contained therein, specifically authorize
out-of-state bank holding companies and banks to acquire or merge with banks in
those states and to establish or acquire branches in those states.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the Capital
Securities, the enforceability of the Trust Agreement and the creation of the
Issuer Trust will be passed upon by Richards, Layton & Finger, P.A., special
Delaware counsel to the Company and the Issuer Trust. Certain matters of law
relating to the validity of the Guarantee and the Junior Subordinated Debentures
will be passed upon for the Company by Ward and Smith, P.A., Raleigh, North
Carolina, General Counsel of the Company. Certain United States federal income
tax matters relating to the Capital Securities and the Issuer Trust will be
passed upon for the Company by Hunton & Williams, Richmond, Virginia, special
tax counsel to the Company. David L. Ward, Jr., who is the senior member of Ward
and Smith, P.A., serves as a director of the Company, and, as of June 30, 1998,
certain members of Ward and Smith, P.A., beneficially owned an aggregate of
26,163 shares of the Company's Class A common stock and 8,349 shares of the
Company's Class B common stock.
EXPERTS
The consolidated financial statements of First Citizens BancShares, Inc.
and subsidiaries as of December 31, 1997 and 1996, and for each of the years in
the three-year period ended December 31, 1997, have been incorporated by
reference herein and in the Registration Statement in reliance upon the report
of KPMG Peat Marwick LLP, independent certified public accountants, incorporated
by reference herein, and upon the authority of said firm as experts in
accounting and auditing.
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No dealer, salesperson or other individual has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made by this Prospectus and, if given
or made, such information or representations must not be relied upon as having
been authorized by BancShares, the Issuer Trust or the Exchange Agent. Neither
the delivery of this Prospectus nor any sale made hereunder and thereunder
shall, under any circumstances, create an implication that there has been no
change in the affairs of BancShares or the Issuer Trust since the date hereof.
This Prospectus does not constitute an offer or solicitation by anyone in any
jurisdiction in which such offer or solicitation is not authorized or in which
the person making such offer or solicitation is not qualified to do so or to
anyone to whom it is unlawful to make such offer or solicitation.
--------------------------------
TABLE OF CONTENTS
Page
-----
Available Information .............................. 4
Incorporation of Certain Documents by Reference .... 5
Certain Defined Terms .............................. 6
Summary ............................................ 7
Risk Factors ....................................... 16
First Citizens BancShares, Inc. .................... 22
Consolidated Ratios of Earnings to Fixed Charges ... 23
Selected Consolidated Financial Data and Other
Information ..................................... 23
FCB/NC Capital Trust I ............................. 24
Accounting Treatment ............................... 24
The Exchange Offer ................................. 24
Description of the New Capital Securities .......... 32
Description of the New Junior Subordinated
Debentures ...................................... 44
Description of the Guarantee ....................... 53
Relationship Among the Capital Securities, the
Junior Subordinated Debentures and the
Guarantee ....................................... 54
Certain Federal Income Tax Consequences ............ 56
Plan of Distribution ............................... 59
Certain ERISA Considerations ....................... 60
Supervision, Regulation and Other Matters .......... 61
Legal Matters ...................................... 66
Experts ............................................ 66
150,000 Capital Securities
FCB/NC Capital Trust I
Offer to Exchange its newly issued
8.05% Capital Securities
(Liquidation Amount $1,000 Per Capital Security)
which have been registered under
the Securities Act of 1933
for any and all of its outstanding
8.05% Capital Securities
(Liquidation Amount $1,000 Per Capital Security)
all as fully and unconditionally guaranteed,
as described herein, by
First Citizens
BancShares, Inc.
----------------------
PROSPECTUS
----------------------
, 1998
- --------------------------------------------------------------------------------
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<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
Permissible Indemnification. Under the General Corporation Law of the State
of Delaware, Registrant generally may indemnify any person who was or is a
party, or is threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding (other than an action by or in the right of
Registrant), whether civil, criminal, administrative or investigative, by reason
of the fact that he is or was a director or officer of Registrant, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of Registrant
and, with respect to any criminal action or proceeding, had no reasonably cause
to believe his conduct was unlawful.
In the case of an action or suit by or in the right of Registrant to
procure a judgment in its favor, Registrant generally may indemnify any person
who was or is a party, or is threatened to be made a party, to any such
threatened, pending or completed action or suit by reason of the fact that he is
or was a director or officer of Registrant, against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection with the
defense or settlement of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
Registrant and, if he shall have been adjudged to be liable to Registrant, only
to the extent the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case such person if fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper).
Mandatory Indemnification. To the extent that a director or officer of
Registrant is successful on the merits or otherwise in defense of any action,
suit or proceeding, or in defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.
Advance for Expenses. Expenses incurred by a director or officer of
Registrant in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by Registrant in advance of the final
disposition of the action, suit or proceeding upon receipt of an undertaking by
or on behalf of such person to repay amounts advanced if it ultimately is
determined that such person is not entitled to be indemnified by Registrant
against such expenses.
Indemnification by Registrant. Registrant's Bylaws provide for
indemnification of its directors and officers to the fullest extent permitted by
Delaware law and require its Board of Directors to take all actions necessary
and appropriate to authorize such indemnification.
Under Delaware law, Registrant may purchase insurance on behalf of any
person who is or was a director or officer against any liability asserted
against him and incurred by him in any such capacity, or arising out of his
status as such, whether or not Registrant would have the power to indemnify him
against such liability. Registrant maintains a liability insurance policy
covering its directors and officers.
Item 21. Exhibits and Financial Statement Schedules.
An index of exhibits appears at page II-6 and is incorporated herein by
reference.
Item 22. Undertakings.
(A) Each of the undersigned registrants hereby 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 thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate
offering price set forth in "Calculation of Registration Fee" table in the
effective Registration Statement; and
II-1
<PAGE>
(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.
2. that, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof;
3. to remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
this offering.
(B) Each of the undersigned Registrants hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report to Section 13(a) or Section 15(b) of
the Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(C) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Securities Act") may be permitted to directors, officers and
controlling persons of the Registrants pursuant to the foregoing provisions, or
otherwise, the Registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrants of expenses incurred or paid by a
director, officer or controlling person of the Registrants in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrants will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction,
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will each be governed by the final
adjudication of such issue.
(D) The undersigned Registrants hereby undertake to respond to requests for
information that is incorporated by reference into the Prospectus pursuant to
Items 4, 10(b), 11 or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the Registration Statement through the
date of responding to the request.
(E) The undersigned registrants hereby undertake to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
undersigned Registrant has duly caused this Registration Statement on Form S-4
to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Raleigh, State of North Carolina, on July 14, 1998.
FIRST CITIZENS BANCSHARES, INC.
BY: /S/ JAMES B. HYLER, JR.
-----------------------------------------
James B. Hyler, Jr.
Vice Chairman
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-4 has been signed by the following persons in
the capacity and on the dates indicated.
<TABLE>
<CAPTION>
Name Title Date
- ---------------------------------------- --------------------------------------- --------------
<S> <C> <C>
/s/ LEWIS R. HOLDING * Chairman and Chief Executive July 14, 1998
---------------------------------- Officer (principal executive officer)
Lewis R. Holding
/s/ FRANK B. HOLDING * Executive Vice Chairman July 14, 1998
----------------------------------
Frank B. Holding
/s/ JAMES B. HYLER, JR. Vice Chairman July 14, 1998
----------------------------------
James B. Hyler, Jr.
/s/ FRANK B. HOLDING, JR. * President and Director July 14, 1998
----------------------------------
Frank B. Holding, Jr.
/s/ KENNETH A. BLACK Vice President, Treasurer and July 14, 1998
---------------------------------- Chief Financial Officer (principal
Kenneth A. Black financial and accounting officer)
/s/ JOHN M. ALEXANDER, JR. * Director July 14, 1998
----------------------------------
John W. Alexander, Jr.
/s/ TED L. BISSETT * Director July 14, 1998
----------------------------------
Ted L. Bissett
/s/ B. IRVIN BOYLE * Director July 14, 1998
----------------------------------
B. Irvin Boyle
/s/ GEORGE H. BROADRICK * Director July 14, 1998
----------------------------------
George H. Broadrick
/s/ HUBERT M. CRAIG, III * Director July 14, 1998
----------------------------------
Hubert M. Craig, III
/s/ BETTY M. FARNSWORTH * Director July 14, 1998
----------------------------------
Betty M. Farnsworth
/s/ LEWIS M. FETTERMAN * Director July 14, 1998
----------------------------------
Lewis M. Fetterman
</TABLE>
II-3
<PAGE>
Name Title Date
- ---------------------------------------- ---------- --------------
/s/ CARMEN P. HOLDING * Director July 14, 1998
----------------------------------
Carmen P. Holding
/s/ CHARLES B. C. HOLT* Director July 14, 1998
----------------------------------
Charles B. C. Holt
/s/ EDWIN A. HUBBARD * Director July 14, 1998
----------------------------------
Edwin A. Hubbard
/s/ GALE D. JOHNSON* Director July 14, 1998
----------------------------------
Gale D. Johnson
/s/ FREEMAN R. JONES * Director July 14, 1998
----------------------------------
Freeman R. Jones
/s/ LUCIUS S. JONES * Director July 14, 1998
----------------------------------
Lucius S. Jones
/s/ JOSEPH T. MALONEY, JR. * Director July 14, 1998
----------------------------------
Joseph T. Malone, Jr.
/s/ J. CLAUDE MAYO, JR.* Director July 14, 1998
----------------------------------
J. Claude Mayo, Jr.
/s/ WILLIAM MCKAY* Director July 14, 1998
----------------------------------
William McKay
/s/ BRENT D. NASH* Director July 14, 1998
----------------------------------
Brent D. Nash
/s/ LEWIS T. NUNNELEE, III* Director July 14, 1998
----------------------------------
Lewis T. Nunnelee, III
/s/ TALBERT O. SHAW* Director July 14, 1998
----------------------------------
Talbert O. Shaw
/s/ R. C. SOLES, JR.* Director July 14, 1998
----------------------------------
R. C. Soles, Jr.
/s/ DAVID L. WARD, JR.* Director July 14, 1998
----------------------------------
David L. Ward, Jr.
Kenneth A. Black hereby signs this Registration Statement on Form S-4 on
July 14, 1998, on behalf of each of the indicated persons for whom he is
attorney-in-fact pursuant to a Power of Attorney filed herewith.
By: /s/ KENNETH A. BLACK
- ----------------------------------
Attorney-In-Fact
II-4
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the undersigned
Registrant has duly caused this Registration Statement on form S-4 to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Raleigh, State of North Carolina, on July 14, 1998.
FCB/NC CAPITAL TRUST I
By: /s/ KENNETH A. BLACK
-----------------------------------------
Kenneth A. Black
Administrator
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on form S-4 has been signed by the following persons in
the capacity and on the dates indicated.
Name Title Date
- ------------------------------------- --------------- --------------
/s/ KENNETH A. BLACK Administrator July 14, 1998
----------------------------------
Kenneth A. Black
/s/ JOHN H. GRAY Administrator July 14, 1998
----------------------------------
John H. Gray
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ------------- ----------- ---------
<S> <C> <C>
3.1 Initial Trust Agreement of FCB/NC Capital Trust I
3.2 Certificate of Trust of FCB/NC Capital Trust I
4.1 Amended and Restated Trust Agreement of FCB/NC Capital Trust I
4.2 Form of Guarantee Agreement
4.3 Junior Subordinated Indenture between Registrant and Bankers
Trust Company, as Debenture Trustee
4.4 Registration Right Agreement
4.5 Form of certificate evidencing New Capital Securities
4.6 Form of New Junior Subordinated Debenture
5.1 Opinion of Ward and Smith, P.A., as to the legality of the Junior
Subordinated Debentures and the Guarantee
5.2 Opinion of Richards, Layton & Finger, P.A., as to the legality of the
Capital Securities
8.1 Opinion of Hunton & Williams as to certain federal income tax matters
12.1 Statement re computation of ratios of earnings to fixed charges
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Ward and Smith, P.A. (included in Exhibit 5.1 hereto)
23.2 Consent of Richards, Layton & Finger, P.A. (included in
Exhibit 5.2 hereto)
23.3 Consent of Hunton & Williams (included in Exhibit 8.1 hereto)
24.1 Powers of Attorney
25.1 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of Bankers Trust Company, as Indenture Trustee under
the Junior Subordinated Indenture
25.2 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of Bankers Trust Company, as Property Trustee under
the Amended and Restated Trust Agreement of FCB/NC Capital
Trust I (included in Exhibit 25.1)
25.3 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of Bankers Trust Company, as Guarantee Trustee under
the Guarantee (included in Exhibit 25.1)
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agency Agreement
</TABLE>
II-6
FCB/NC CAPITAL TRUST I EXHIBIT 3.1
TRUST AGREEMENT
THIS TRUST AGREEMENT, dated as of February 27, 1998, is by and between
(i) First Citizens BancShares, Inc., a Delaware corporation (the "Depositor"),
and (ii) Bankers Trust (Delaware), a Delaware banking corporation, as Delaware
trustee ("Trustee"). The Depositor and the Trustee hereby agree as follows:
1. The trust created hereby (the "Trust") shall be known as "FCB/NC
Capital Trust I."
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trust the sum of $10. Such amount shall constitute the initial trust estate.
The Trustee hereby declares that it will hold the trust estate in trust for the
Depositor.
3. It is the intention of the parties hereto that the Trust created
hereby constitute a business trust under Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ss. 3801 et seq. (the "Business Trust Act"), and that this
document constitutes the governing instrument of the Trust.
4. The Trustee is hereby authorized and directed to execute and file a
certificate of trust with the Delaware Secretary of State in accordance with the
provisions of the Business Trust Act.
5. The Depositor, the Trustee and others will enter into an amended and
restated Trust Agreement, satisfactory to each such party and substantially to
the effect set forth in the Preliminary Offering Memorandum (as defined below),
to provide for the contemplated operation of the Trust created hereby and the
issuance of Capital Securities and Common Securities referred to therein. Prior
to the execution and delivery of such amended and restated Trust Agreement, the
Trustee shall not have any duty or obligation hereunder or with respect to the
trust estate, except as otherwise required by applicable law or as may be
necessary to obtain, prior to such execution and delivery, any licenses,
consents or approvals required by applicable law or otherwise.
6. The Depositor, as depositor of the Trust, is hereby authorized, in
its discretion, (i) to prepare one or more offering memoranda in preliminary and
final form relating to the offering and sale of Capital Securities of the Trust
in a transaction exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and such forms or filings as may be
required by the 1933 Act, the Securities Exchange Act of 1934, as amended, or
the Trust Indenture Act of 1939, as amended, in each case relating to the
Capital Securities of the Trust; (ii) to file and execute on behalf of the
Trust, such applications, reports, surety bonds, irrevocable consents,
appointments of attorney for service of process and other papers and documents
that shall be necessary or desirable to register or establish the exemption from
registration of the Capital Securities of the Trust under the securities or
"Blue Sky" laws of such jurisdictions as the Depositor, on behalf of the Trust,
may deem necessary or desirable; (iii) to execute and file an application, and
all other applications, statements, certificates, agreements and other
instruments that shall be necessary or desirable, to the Private Offerings,
Resales and Trading through Automated Linkages ("PORTAL") Market; (iv) to
execute and deliver letters or documents to, or instruments for filing
<PAGE>
with, a depository relating to the Capital Securities of the Trust; and (v) to
execute, deliver and perform on behalf of the Trust one or more purchase
agreements, dealer manager agreements, escrow agreements, registration rights
agreements and other related agreements providing for or relating to the sale of
the Capital Securities of the Trust.
In the event that any filing referred to in this Section 6 is
required by the rules and regulations of the Securities and Exchange Commission
(the "Commission"), PORTAL or state securities or "Blue Sky" laws to be executed
on behalf of the Trust by the Trustee, the Trustee, in its capacity as trustee
of the Trust, is hereby authorized to join in any such filing and to execute on
behalf of the Trust any and all of the foregoing, it being understood that the
Trustee, in its capacity as trustee of the Trust, shall not be required to join
in any such filing or execute on behalf of the Trust any such document unless
required by the rules and regulations of the Commission, PORTAL or state
securities or "Blue Sky" laws.
7. This Trust Agreement may be executed in one or more counterparts.
8. The number of trustees initially shall be one (1) and thereafter the
number of trustees shall be such number as shall be fixed from time to time by a
written instrument signed by the Depositor, who may increase or decrease the
number of trustees; provided, however, that, to the extent required by the
Business Trust Act, one trustee shall either be a natural person who is a
resident of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware and otherwise meets the
requirements of applicable Delaware law. Subject to the foregoing, the Depositor
is entitled to appoint or remove without cause any trustee at any time. Any
trustee may resign upon thirty (30) days' prior written notice to the Depositor.
9. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have caused this Trust Agreement to be duly executed as of the date first
written above.
FIRST CITIZENS BANCSHARES, INC.,
as Depositor
By: /s/ Kenneth A. Black
-------------------------
Name: Kenneth A. Black
Title: Vice President
<PAGE>
BANKERS TRUST (DELAWARE),
as Delaware trustee, and not in
its individual capacity
By: /s/ M. Lisa Wilkins
-------------------------
Name: M. Lisa Wilkins
Title: Assistant Secretary
CERTIFICATE OF TRUST OF EXHIBIT 3.2
FCB/NC CAPITAL TRUST I
THIS CERTIFICATE OF TRUST of FCB/NC Capital Trust I (the "Trust"),
dated February 27, 1998, is being duly executed and filed by Bankers Trust
(Delaware), a Delaware banking corporation, as trustee, to form a business trust
under the Delaware Business Trust Act (12 Del. C. ss. 3801 et seq.).
1. Name. The name of the business trust formed hereby is "FCB/NC
Capital Trust I".
2. Delaware Trustee. The name and address of the trustee of the Trust
with a principal place of business in the State of Delaware is:
Bankers Trust (Delaware)
E.A. Delle Donne Corporate Center
Montgomery Building
1011 Centre Road, Suite 200
Wilmington, Delaware 19805-1266
3. Effective Date. This Certificate of Trust shall be effective upon
its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first written
above.
BANKERS TRUST (DELAWARE),
not in its individual capacity, but
solely as trustee
By: /s/ M. Lisa Wilkins
------------------------------
Name: M. Lisa Wilkins
Title: Assistant Secretary
EXHIBIT 4.1
AMENDED AND RESTATED
TRUST AGREEMENT
AMONG
FIRST CITIZENS BANCSHARES, INC.
AS DEPOSITOR,
BANKERS TRUST COMPANY
AS PROPERTY TRUSTEE,
AND
BANKERS TRUST (DELAWARE),
AS DELAWARE TRUSTEE
DATED AS OF MARCH 5, 1998
----------------------
FCB/NC CAPITAL TRUST I
----------------------
<PAGE>
FCB/NC CAPITAL TRUST I
Certain Sections of this Trust Agreement relating, to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Act
Section Trust Agreement Section
------------------- -----------------------
Section 310 (a)(1)............................8.7
(a)(2)............................8.7
(a)(3)............................8.9
(a)(4)............................2.7(a)(ii)
(b)...............................8.8, 10.10(b)
Section 311 (a)...............................8.13, 10.10(b)
(b)...............................8.13, 10.10(b)
Section 312 (a)...............................10.10(b)
(b)...............................10.10(b), (f)
(c)...............................5.7
Section 313 (a)...............................8.15(a)
(a)(4)............................10.10(c)
(b)...............................8.15(c), 10.10(c)
(c)...............................10.8, 10.10(c)
(d)...............................10.10(c)
Section 314 (a)...............................8.16, 10.10(d)
(b)...............................Not Applicable
(c)(1)............................8.17, 10.10(d), (e)
(c)(2)............................8.17, 10.10(d), (e)
(c)(3)............................8.17, 10.10(d), (e)
(e)...............................8.17, 10.10(e)
Section 315 (a)...............................8.1(d)
(b)...............................8.2
(c)...............................8.1(c)
(d)...............................8.1(d)
(e)...............................Not Applicable
Section 316 (a)...............................Not Applicable
(a)(1)(A).........................Not Applicable
(a)(1)(B).........................Not Applicable
(a)(2)............................Not Applicable
(b)...............................5.13
(c)...............................6.7
Section 317 (a)(1)............................Not Applicable
(a)(2)............................8.14
(b)...............................5.10
Section 318 (a)...............................10.10(a)
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Trust Agreement.
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Page
ARTICLE I. DEFINED TERMS
SECTION 1.1. Definitions........................................................... 2
ARTICLE II. CONTINUATION OF THE ISSUER TRUST
SECTION 2.1. Name..................................................................14
SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business...........15
SECTION 2.3. Initial Contribution of Trust Property; Organizational Expenses......15
SECTION 2.4. Issuance of the Capital Securities....................................15
SECTION 2.5. Issuance of the Common Securities; Subscription and
Purchase of Junior Subordinated Debentures...................15
SECTION 2.6. Declaration of Trust..................................................16
SECTION 2.7. Authorization to Enter into Certain Transactions......................16
SECTION 2.8. Assets of Trust.......................................................19
SECTION 2.9. Title to Trust Property...............................................20
ARTICLE III. PAYMENT ACCOUNT
SECTION 3.1. Payment Account.......................................................20
ARTICLE IV. DISTRIBUTIONS; REDEMPTION
SECTION 4.1. Distributions.........................................................20
SECTION 4.2. Redemption............................................................21
SECTION 4.3. Subordination of Common Securities....................................24
SECTION 4.4. Payment Procedures....................................................24
SECTION 4.5. Tax Returns and Reports...............................................25
SECTION 4.6. Payment of Taxes, Duties, Etc. of the Issuer Trust....................25
SECTION 4.7. Payments under Indenture or Pursuant to Direct Actions................25
SECTION 4.8. Liability of the Holder of Common Securities..........................25
ARTICLE V. TRUST SECURITIES CERTIFICATES
SECTION 5.1. Initial Ownership.....................................................26
SECTION 5.2. The Trust Securities Certificates.....................................26
SECTION 5.3. Execution and Delivery of Trust Securities Certificates...............27
SECTION 5.4. Global Capital Security...............................................27
SECTION 5.5. Registration of Transfer and Exchange Generally; Certain
Transfers and Exchanges; Capital Securities Certificates;
Securities Act Legends.......................................28
SECTION 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates....32
SECTION 5.7. Persons Deemed Holders................................................32
SECTION 5.8. Access to List of Holders' Names and Addresses........................33
SECTION 5.9. Maintenance of Office or Agency.......................................33
SECTION 5.10. Appointment of Paying Agent..........................................33
SECTION 5.11. Ownership of Common Securities by Depositor..........................34
SECTION 5.12. Notices to Clearing Agency...........................................34
SECTION 5.13. Rights of Holders....................................................34
<PAGE>
ARTICLE VI. ACTS OF HOLDERS; MEETINGS; VOTING
SECTION 6.1. Limitations on Holder's Voting Rights.................................36
SECTION 6.2. Notice of Meetings....................................................37
SECTION 6.3. Meetings of Holders...................................................37
SECTION 6.4. Voting Rights.........................................................38
SECTION 6.5. Proxies, etc..........................................................38
SECTION 6.6. Holder Action by Written Consent......................................38
SECTION 6.7. Record Date for Voting and Other Purposes.............................39
SECTION 6.8. Acts of Holders.......................................................39
SECTION 6.9. Inspection of Records.................................................40
ARTICLE VII. REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Property Trustee and
the Delaware Trustee.........................................40
SECTION 7.2. Representations and Warranties of Depositor...........................41
ARTICLE VIII.THE ISSUER TRUSTEES; THE ADMINISTRATORS
SECTION 8.1. Certain Duties and Responsibilities...................................42
SECTION 8.2. Certain Notices.......................................................44
SECTION 8.3. Certain Rights of Property Trustee....................................44
SECTION 8.4. Not Responsible for Recitals or Issuance of Securities................46
SECTION 8.5. May Hold Securities...................................................46
SECTION 8.6. Compensation; Indemnity; Fees.........................................46
SECTION 8.7. Corporate Property Trustee Required; Eligibility
of Trustees and Administrators...............................47
SECTION 8.8. Conflicting Interests.................................................48
SECTION 8.9. Co-Trustees and Separate Trustee......................................48
SECTION 8.10. Resignation and Removal; Appointment of Successor....................49
SECTION 8.11. Acceptance of Appointment by Successor...............................50
SECTION 8.12. Merger, Conversion, Consolidation or Succession to Business.........51
SECTION 8.13. Preferential Collection of Claims Against Depositor or Issuer Trust..51
SECTION 8.14. Trustee May File Proofs of Claims....................................51
SECTION 8.15. Reports by Property Trustee..........................................52
SECTION 8.16. Reports to the Property Trustee......................................53
SECTION 8.17. Evidence of Compliance with Conditions Precedent.....................53
SECTION 8.18. Number of Issuer Trustees............................................53
SECTION 8.19. Delegation of Power..................................................53
SECTION 8.20. Appointment of Administrators........................................53
ARTICLE IX. DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. Termination Upon Expiration Date......................................54
SECTION 9.2. Early Termination.....................................................54
SECTION 9.3. Termination...........................................................55
SECTION 9.4. Liquidation...........................................................55
SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements
of the Issuer Trust..........................................56
-ii-
<PAGE>
ARTICLE X. MISCELLANEOUS PROVISIONS
SECTION 10.1. Limitation of Rights of Holders.....................................57
SECTION 10.2. Amendment...........................................................58
SECTION 10.3. Separability........................................................59
SECTION 10.4. Governing Law.......................................................59
SECTION 10.5. Payments Due on Non-Business Day....................................60
SECTION 10.6. Successors..........................................................60
SECTION 10.7. Headings............................................................60
SECTION 10.8. Reports, Notices and Demands........................................60
SECTION 10.9. Agreement Not to Petition...........................................61
SECTION 10.10. Trust Indenture Act; Conflict with Trust Indenture Act..............62
SECTION 10.11. Acceptance of Terms of Trust Agreement, Guarantee
and Indenture..............................................63
ARTICLE XI. REGISTRATION RIGHTS
SECTION 11.1 Registration Rights.................................................63
</TABLE>
Exhibit A Certificate of Trust
Exhibit B Form of Certificate Depositary Agreement
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Capital Securities Certificate
Exhibit E Form of Restricted Securities Certificate
-ii-
<PAGE>
AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT, dated as of March 5, 1998,
is by and among (i) First Citizens BancShares, Inc., a Delaware corporation
(including any successors or assigns, the "Depositor"), (ii) Bankers Trust
Company, a New York banking corporation, 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) Bankers Trust (Delaware), a
Delaware banking corporation, as Delaware trustee (the "Delaware Trustee") (the
Property Trustee and the Delaware Trustee are referred to collectively herein as
the "Issuer Trustees"), (iv) the Administrators, as hereinafter defined, and (v)
the several Holders, as hereinafter defined.
WITNESSETH
WHEREAS, the Depositor and the Delaware Trustee have heretofore duly
declared and established a business trust pursuant to the Delaware Business
Trust Act by entering into a certain Trust Agreement, dated as of February 27,
1998 (the "Original Trust Agreement"), and by the execution and filing by the
Delaware Trustee with the Secretary of State of the State of Delaware of the
Certificate of Trust, filed on February 27, 1998 (the "Certificate of Trust"),
attached as Exhibit A; and
WHEREAS, the Depositor and the Delaware Trustee 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 Issuer Trust to the Depositor, (ii) the issuance and sale of the Capital
Securities by the Issuer Trust pursuant to the Purchase Agreement, (iii) the
acquisition by the Issuer Trust from the Depositor of all of the right, title
and interest in the Junior Subordinated Debentures, (iv) the appointment of the
Administrators and (v) the addition of the Property Trustee as a party to this
Trust Agreement.
NOW THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Holders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees, intending to be legally
bound, as follows:
<PAGE>
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:
(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) The words "include," "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";
(d) All accounting terms used but not defined herein have the meanings
assigned to them in accordance with United States generally accepted accounting
principles as in effect at the time of computation;
(e) 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;
(f) 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; and
(g) all references to the date the Capital Securities were originally
issued shall refer to the date the 8.05% Capital Securities were originally
issued.
"ACT" has the meaning specified in Section 6.8.
"ADDITIONAL AMOUNTS" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"ADDITIONAL SUMS" has the meaning specified in Section 10.6 of the
Indenture.
"ADJUSTED TREASURY RATE" means, with respect to any Redemption Date,
the Treasury Rate plus (i) 1.50% if such
-2-
<PAGE>
Redemption Date occurs on or before March 1, 1999 or (ii) 1.00% if such
Redemption Date occurs after March 1, 1999.
"ADMINISTRATORS" means each Person appointed in accordance with Section
8.20 solely in such Person's capacity as Administrator of the Issuer Trust
continued hereunder and not in such Person's individual capacity, or any
successor Administrator appointed as herein provided; with the initial
Administrators being Kenneth A. Black and John H. Gray.
"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.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
transaction involving a Global Capital Security or beneficial interest therein,
the rules and procedures of the Depositary for such Capital Security, in each
case to the extent applicable to such transaction and as in effect from time to
time.
"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 any substantial part of its property or ordering
the winding-up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 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,
-3-
<PAGE>
sequestrator (or similar official) of such Person or of any substantial part 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.
"BOARD OF DIRECTORS" means the board of directors of the Depositor or
the Executive Committee of the board of directors of the Depositor (or any other
committee of the board of directors of the Depositor performing similar
functions) or a committee designated by the board of directors of the Depositor
(or any such committee), comprised of two or more members of the board of
directors of the Depositor or officers of the Depositor, or both.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly adopted
by the Depositor's Board of Directors, or such committee of the Board of
Directors or officers of the Depositor to which authority to act on behalf of
the Board of Directors has been delegated, and to be in full force and effect on
the date of such certification, and delivered to the Issuer Trustees.
"BUSINESS DAY" means a day other than (a) a Saturday or Sunday, (b) a
day on which banking institutions in the City of New York, New York, or the City
of Raleigh, North Carolina are authorized or required by law or executive order
to remain closed or (c) a day on which the Property Trustee's Corporate Trust
Office or the Delaware Trustee's corporate trust office or the corporate trust
office of the Debenture Trustee is closed for business.
"CAPITAL SECURITIES CERTIFICATE" means a certificate evidencing
ownership of Capital Securities, substantially in the form attached as Exhibit
D.
"CAPITAL SECURITY" means a preferred undivided beneficial interest in
the assets of the Issuer Trust, having a Liquidation Amount of $1,000 and having
the rights provided therefor in this Trust Agreement, including the right to
receive Distributions and a Liquidation Distribution as provided herein.
"CAPITAL TREATMENT EVENT" means, in respect of the Issuer Trust, the
reasonable determination by the Depositor that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in, the
laws (or any rules or regulations thereunder) of the United States or any
political subdivision thereof or therein, or as a result of any official or
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administrative pronouncement or action or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement, action or decision is announced on or after the date of the
issuance of the Capital Securities of the Issuer Trust, there is more than an
insubstantial risk that the Depositor will not be entitled to treat an amount
equal to the Liquidation Amount of such Capital Securities as "Tier 1 Capital"
(or the then equivalent thereof) for purposes of the risk-based capital adequacy
guidelines of the Board of Governors of the Federal Reserve System, as then in
effect and applicable to the Depositor.
"CEDE" means Cede & Co.
"CERTIFICATE DEPOSITARY AGREEMENT" means the agreement among the Issuer
Trust, the Depositor and the Depositary, as the initial Clearing Agency, dated
as of the Closing Date, substantially in the form attached as Exhibit B, as the
same may be amended and supplemented from time to time.
"CERTIFICATE OF TRUST" has the meaning specified in the preamble to
this Trust Agreement.
"CLEARING AGENCY" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. The Depositary shall 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 the Closing Time, which date is also the date of
execution and delivery of this Trust Agreement.
"CLOSING TIME" has the meaning in the Purchase Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the Securities and Exchange Commission, as from time
to time constituted, created under the Exchange Act, 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, then the
body performing such duties at such time.
"COMMON SECURITIES CERTIFICATE" means a certificate evidencing
ownership of Common Securities, substantially in the form attached as Exhibit C.
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"COMMON SECURITIES PURCHASE AGREEMENT" means the Common Securities
Purchase Agreement dated as of March 5, 1998 between the Issuer Trust and the
Depositor, as the same may be amended from time to time.
"COMMON SECURITY" means an undivided beneficial interest in the assets
of the Issuer Trust, having a Liquidation Amount of $1,000 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"COMPARABLE TREASURY ISSUE" means with respect to any Redemption Date
the United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining
Life. If no United States Treasury security has a maturity which is within a
period from three months before to three months after March 1, 2008, the two
most closely corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month using such
securities.
"COMPARABLE TREASURY PRICE" means (A) the average of five Reference
Treasury Dealer Quotations for such Redemption Date, after excluding the highest
and lowest of such Reference Treasury Dealer Quotations, or (B) if the Debenture
Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the
average of all such Reference Treasury Dealer Quotations.
"CORPORATE TRUST OFFICE" means the principal office of the Property
Trustee located in the City of New York which at the time of the execution of
this Trust Agreement is located at Four Albany Street, New York, New York 10006;
Attention: Corporate Trust and Agency Group - Corporate Market Services.
"DEBENTURE EVENT OF DEFAULT" means an "Event of Default" as defined in
the Indenture.
"DEBENTURES PURCHASE AGREEMENT" means the Junior Subordinated
Deferrable Interest Debentures Purchase Agreement dated as of March 5, 1998
between the Depositor and the Issuer Trust, as the same may be amended from time
to time.
"DEBENTURE REDEMPTION DATE" means, with respect to any Junior
Subordinated Debentures to be redeemed under the Junior Subordinated Indenture,
the date fixed for redemption of such Debentures under the Indenture.
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"DEBENTURE TRUSTEE" means Bankers Trust Company, a New York banking
corporation and any successor.
"DELAWARE BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C. ss. 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 Issuer Trust continued hereunder and not in its
individual capacity, or its successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"DEPOSITARY" means The Depository Trust Company or any successor
thereto.
"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.
"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 Issuer 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 Issuer 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 Issuer Trustees in this Trust Agreement (other
than a covenant or warranty a default in the performance of which or the breach
of which is dealt with in clause (b) or (c) above) and continuation of
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such default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the Issuer Trustees and the Depositor by the
Holders of at least 25% in aggregate Liquidation Amount of the Outstanding
Capital 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 any Bankruptcy Event with respect to the
Property Trustee or all or substantially all of its property if a successor
Property Trustee has not been appointed within a period of 90 days thereof.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and any successor statute thereto, as amended from time to time.
"EXCHANGE CAPITAL SECURITIES" has the meaning specified in Section
5.5(d).
"EXCHANGE OFFER" has the meaning specified in the Registration Rights
Agreement.
"EXPIRATION DATE" has the meaning specified in Section 9.1.
"GLOBAL CAPITAL SECURITIES CERTIFICATE" means a Capital Securities
Certificate evidencing ownership of Global Capital Securities.
"GLOBAL CAPITAL SECURITY" means a Capital Security, the ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.4.
"GUARANTEE" means the Guarantee Agreement executed and delivered by the
Depositor and Bankers Trust Company, as trustee, contemporaneously with the
execution and delivery of this Trust Agreement, for the benefit of the holders
of the Capital 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 shall be
deemed to be a beneficial owner within the meaning of the Delaware Business
Trust Act.
"INDENTURE" means the Junior Subordinated Indenture, dated as of March
5, 1998, between the Depositor and the Debenture Trustee (as amended or
supplemented from time to time) relating to the issuance of the Junior
Subordinated Debentures.
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"INITIAL PURCHASER" has the meaning specified in the Purchase
Agreement.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institutional accredited
investor within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended.
"INVESTMENT COMPANY EVENT" means the receipt by the Issuer Trust of an
Opinion of Counsel experienced in such matters to the effect that, as a result
of the occurrence of a change in law or regulation or a written change
(including any announced prospective 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 Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the issuance of the Capital Securities.
"ISSUER TRUST" means FCB/NC Capital Trust I.
"ISSUER TRUSTEES" means, collectively, the Property Trustee and the
Delaware Trustee.
"JUNIOR SUBORDINATED DEBENTURES" means the aggregate principal amount
of the Depositor's 8.05% Junior Subordinated Deferrable Interest Debentures, due
March 1, 2028, issued pursuant to the Indenture.
"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 that portion
of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes and (b) with respect to a distribution of
Junior Subordinated Debentures to Holders of Trust Securities in connection with
a dissolution or liquidation of the Issuer Trust, Junior Subordinated Debentures
having a principal amount equal to
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the Liquidation Amount of the Trust Securities of the Holder to whom such Junior
Subordinated Debentures are distributed.
"LIQUIDATION AMOUNT" means the stated amount of $1,000 per Trust
Security.
"LIQUIDATION DATE" means the date on which Junior Subordinated
Debentures are to be distributed to Holders of Trust Securities in connection
with a dissolution and liquidation of the Issuer Trust pursuant to Section 9.4.
"LIQUIDATION DISTRIBUTION" has the meaning specified in Section 9.4(d).
"MAJORITY IN LIQUIDATION AMOUNT OF THE CAPITAL SECURITIES" or "Majority
in Liquidation Amount of the Common Securities" means, except as provided by the
Trust Indenture Act, Capital Securities or Common Securities, as the case may
be, representing more than 50% of the aggregate Liquidation Amount of all then
Outstanding Capital Securities or Common Securities, as the case may be.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board, Vice Chairman of the Board, Chief Executive Officer, President or an
Executive Vice President, a Senior Vice President or Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of
the Depositor, and delivered to the party provided herein. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Trust Agreement shall include:
(a) a statement by each officer signing the Officers' Certificate that
such officer 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 such officer in rendering the Officers' Certificate;
(c) a statement that 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.
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"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel for or an employee of the Depositor or any Affiliate of the Depositor.
"ORIGINAL TRUST AGREEMENT" has the meaning specified in the preamble to
this Trust Agreement.
"OTHER CAPITAL SECURITIES" means the Capital Securities sold by the
Initial Purchaser in the initial offering contemplated by the Purchase Agreement
to Institutional Accredited Investors in reliance on an exemption from the
registration requirement of the Securities Act other than Rule 144A.
"OUTSTANDING," 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 Property Trustee or
delivered to the Property Trustee 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 Capital 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 and 5.6;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Capital Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Capital
Securities owned by the Depositor, any Issuer Trustee, any Administrator or any
Affiliate of the Depositor, shall be disregarded and deemed not to be
Outstanding, except that (a) in determining whether any Issuer Trustee or any
Administrator shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Capital Securities
that such Issuer Trustee or such Administrator, as the case may be, knows to be
so owned shall be so disregarded and (b) the foregoing shall not apply at any
time when all of the Outstanding Capital Securities are owned by the Depositor,
one or more of the Issuer Trustees, one or more of the Administrators and/or any
such Affiliate. Capital 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
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Capital Securities and that the pledgee is not the Depositor or any Affiliate of
the Depositor.
"OWNER" means each Person who is the beneficial owner of Global Capital
Securities 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 5.10 and shall initially be the Property Trustee.
"PAYMENT ACCOUNT" means a segregated non-interest-bearing corporate
trust account maintained with the Property Trustee in its trust department for
the benefit of the Holders in which all amounts paid in respect of the Junior
Subordinated Debentures will be held and from which the Property Trustee,
through the Paying Agent, shall make payments to the Holders in accordance with
Sections 4.1 and 4.2.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, company,
limited liability company, trust, unincorporated organization or government or
any agency or political subdivision thereof, or any other entity of whatever
nature.
"PROPERTY TRUSTEE" means the Person identified as the "Property
Trustee" in the preamble to this Trust Agreement solely in its capacity as
Property Trustee of the Issuer Trust continued hereunder and not in its
individual capacity, or its successor in interest in such capacity, or any
successor property trustee appointed as herein provided.
"PURCHASE AGREEMENT" means the Purchase Agreement, dated as of March 2,
1998, among the Issuer Trust, the Depositor and the Initial Purchaser, as the
same may be amended from time to time.
"QUOTATION AGENT" means Wheat First Securities, Inc. and its
successors; provided, however, that if the foregoing shall cease to be a primary
U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Depositor shall substitute therefor another Primary Treasury
Dealer.
"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 Junior Subordinated Debentures shall be a Redemption Date for a Like
Amount of Trust
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Securities, including but not limited to any date of redemption pursuant to the
occurrence of any Special Event.
"REDEMPTION PRICE" means:
(a) in the case of a redemption, other than as provided in paragraph
(b) below, the following prices expressed in percentages of the Liquidation
Amount, together with accumulated Distributions to but excluding the date fixed
for redemption, if redeemed during the 12-month period beginning March 1:
Year Redemption Price
---- ----------------
2008 .....................104.03
2009 .....................103.62
2010 .....................103.22
2011 .....................102.82
2012 .....................102.42
2013 .....................102.01
2014 .....................101.61
2015 .....................101.21
2016 .....................100.81
2017 .....................100.40
and 100% on or after March 1, 2018.
(b) in the case of a redemption prior to March 1, 2008 following a Tax
Event, Investment Company Event or Capital Treatment Event, an amount equal to
for each Capital Security the Make-Whole Amount for a corresponding $1,000
principal amount of Junior Subordinated Debentures together with accumulated
Distributions to but excluding the date fixed for redemption. The "MAKE-WHOLE
AMOUNT" will be equal to the greater of (i) 100% of the principal amount of such
Junior Subordinated Debentures, and (ii) as determined by a Quotation Agent, the
sum of the present values of the principal amount and premium payable as part of
the Redemption Price with respect to an optional redemption of such Junior
Subordinated Debentures on March 1, 2008, together with the present values of
scheduled payments of interest (not including the portion of any such payments
of interest accrued as of the Redemption Date) from the Redemption Date to March
1, 2008 (the "REMAINING LIFE"), in each case discounted to the Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of 30-day months) at
the Adjusted Treasury Rate. The Redemption Price in the case of a redemption on
or after March 1, 2008 following a Tax Event, Investment Company Event or
Capital Treatment Event shall equal the Redemption Price then applicable to a
redemption under paragraph (a) above.
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"REFERENCE TREASURY DEALER" means (i) the Quotation Agent and (ii) any
other Primary Treasury Dealer selected by the Debenture Trustee after
consultation with the Depositor.
"REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Debenture Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Debenture Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
dated as of March 5, 1998 among the Depositor, the Issuer Trust and the Initial
Purchaser as the same may be amended from time to time.
"REGULATION D" means Regulation D under the Securities Act (or any
successor provision), as it may be amended from time to time.
"RELEVANT TRUSTEE" has the meaning specified in Section 8.10.
"RESPONSIBLE OFFICER" when used with respect to the Property Trustee
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, principal, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Property Trustee
customarily performing functions similar to those performed by any of the above
designated officers and having direct responsibility for the administration of
the Indenture, and also, with respect to a particular matter, any other officer
to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"RESTRICTED CAPITAL SECURITIES" means all Capital Securities, the
Capital Securities Certificate for which is required pursuant to Section 5.5(c)
to bear a Restricted Capital Securities Legend. Such term includes the Global
Capital Securities Certificate.
"RESTRICTED CAPITAL SECURITIES LEGEND" means a legend substantially in
the form of the legend required in the form of a Capital Securities Certificate
set forth in Exhibit D to be placed upon a Restricted Capital Security.
"RESTRICTED SECURITIES CERTIFICATE" means a certificate substantially
in the form set forth in Exhibit E.
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"RULE 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"RULE 144A CAPITAL SECURITIES" means the Capital Securities purchased
by the Initial Purchaser from the Issuer Trust pursuant to the Purchase
Agreement, other than the Other Capital Securities.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and any
successor statute thereto, in each case as amended from time to time.
"SENIOR INDEBTEDNESS" has the meaning specified in the Indenture.
"SECURITIES REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings specified in Section 5.5.
"SPECIAL EVENT" means any Tax Event, Capital Treatment Event or
Investment Company Event.
"SUCCESSOR CAPITAL SECURITIES CERTIFICATE" of any particular Capital
Securities Certificate means every Capital Securities Certificate issued after,
and evidencing all or a portion of the same beneficial interest in the Issuer
Trust as that evidenced by, such particular Capital Securities Certificate; and,
for the purposes of this definition, any Capital Securities Certificate executed
and delivered under Section 5.6 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Capital Securities Certificate shall be deemed to
evidence the same beneficial interest in the Issuer Trust as the mutilated,
destroyed, lost or stolen Capital Securities Certificate.
"SUCCESSOR CAPITAL SECURITY" has the meaning specified in Section 9.5.
"TAX EVENT" means the receipt by the Issuer Trust of an Opinion of
Counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement, action or decision is announced on or after
the date of issuance of the Capital Securities, there is more than an
insubstantial risk that (i) the Issuer Trust is, or will be within 90 days of
the delivery of such Opinion of Counsel, subject to United States federal income
tax with respect to income received or accrued on the Junior Subordinated
Debentures, (ii) interest payable by the Depositor on
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the Junior Subordinated Debentures is not, or within 90 days of the delivery 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 Issuer Trust
is, or will be within 90 days of the delivery of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"TREASURY RATE" means (i) the yield, under the heading which represents
the average for the week immediately prior to the calculation date, appearing in
the most recently published statistical release designated "H.15 (519)" or any
successor publication which is published weekly by the Board of Governors of the
Federal Reserve System and which establishes yields on actively traded United
States Treasury securities adjusted to constant maturity under the caption
"Treasury Constant Maturities," for the maturity corresponding to the Remaining
Life (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 Treasury Rate shall be interpolated
or extrapolated from such yields on a straight-line basis, rounding to the
nearest month) or (ii) if such release (or any successor release) is not
published during the week preceding the calculation date or does not contain
such yields, the rate per annum equal to the semi-annual equivalent yield to
maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price for such Redemption Date. The Treasury
Rate shall be calculated on the third Business Day preceding the Redemption
Date.
"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 (i) all exhibits hereto, and (ii) for
all purposes of this Amended and Restated Trust Agreement any such modification,
amendment or supplement, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this Amended and Restated Trust Agreement and
any modification, amendment or supplement, respectively.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939 or any
successor statute, in each case as amended from time to time.
"TRUST PROPERTY" means (a) the Junior Subordinated Debentures, (b) any
cash on deposit in, or owing to, the Payment Account, (c) all proceeds and
rights in respect of the foregoing and (d) 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 SECURITIES CERTIFICATE" means any one of the Common Securities
Certificates or the Capital Securities Certificates.
"TRUST SECURITY" means any one of the Common Securities or the Capital
Securities.
ARTICLE II
CONTINUATION OF THE ISSUER TRUST
SECTION 2.1. NAME.
The Issuer Trust continued hereby shall be known as "FCB/NC Capital
Trust I", as such name may be modified from time to time by the Administrators
following written notice to the Holders of Trust Securities and the Issuer
Trustees, in which name the Administrators and the Issuer Trustees may engage in
the transactions contemplated hereby, make and execute contracts and other
instruments on behalf of the Issuer 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 Bankers
Trust (Delaware), E.A. Delle Donne Corporate Center, Montgomery Building, 1011
Centre Road, Suite 200, Wilmington, Delaware 19805-1266, Attention: Lisa
Wilkins, or such other address in the State of Delaware as the Delaware Trustee
may designate by written notice to the Holders and the Depositor. The principal
executive office of the Issuer Trust is in care of First Citizens BancShares,
Inc., 3128 Smoketree Court, Raleigh, North Carolina 27604, Attention: Kenneth A.
Black.
SECTION 2.3. INITIAL CONTRIBUTION OF TRUST PROPERTY; ORGANIZATIONAL
EXPENSES.
The Property Trustee acknowledges receipt in trust from the Depositor
in connection with this Trust Agreement of the sum of $10, which constitutes the
initial Trust Property. The Depositor shall pay all organizational expenses of
the Issuer Trust as they arise or shall, upon request of any Issuer Trustee,
promptly reimburse such Issuer Trustee for any such expenses paid by such Issuer
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
SECTION 2.4. Issuance of the Capital Securities.
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The Depositor and the Issuer Trust executed and delivered the Purchase
Agreement pursuant to the Original Trust Agreement. Contemporaneously with the
execution and delivery of this Trust Agreement, an Administrator, on behalf of
the Issuer Trust, shall manually execute in accordance with Section 5.3 and the
Property Trustee shall authenticate in accordance with Section 5.3 and deliver
to the Initial Purchaser, Capital Securities Certificates, registered in the
names requested by the Initial Purchaser, in an aggregate amount of 150,000
Capital Securities having an aggregate Liquidation Amount of $150,000,000,
against receipt of the aggregate purchase price of such Capital Securities of
$149,745,000, by the Property Trustee.
An Administrator, on behalf of the Issuer Trust, shall manually execute
in accordance with Section 5.3 and the Property Trustee shall authenticate in
accordance with Section 5.3, the Exchange Capital Securities in exchange for
such Capital Securities accepted for exchange in the Exchange Offer.
SECTION 2.5. ISSUANCE OF THE COMMON SECURITIES; SUBSCRIPTION AND
PURCHASE OF JUNIOR SUBORDINATED DEBENTURES.
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrator, on behalf of the Issuer Trust, shall execute or
cause to be executed in accordance with Section 5.3 and the Property Trustee
shall deliver to the Depositor Common Securities Certificates, registered in the
name of the Depositor, in an aggregate amount of 4,640 Common Securities having
an aggregate Liquidation Amount of $4,640,000 against receipt of the aggregate
purchase price of such Common Securities of $4,640,000 by the Property Trustee.
Contemporaneously therewith, an Administrator, on behalf of the Issuer Trust,
shall subscribe for and purchase from the Depositor the Junior Subordinated
Debentures, registered in the name of the Issuer Trust and having an aggregate
principal amount equal to $154,640,000, and, in satisfaction of the purchase
price for such Junior Subordinated Debentures, the Property Trustee, on behalf
of the Issuer Trust, shall deliver to the Depositor the sum of $154,385,000
(being the sum of the amounts delivered to the Property Trustee pursuant to (i)
the second sentence of Section 2.4, and (ii) the first sentence of this Section
2.5) and receive on behalf of the Issuer Trust the Junior Subordinated
Debentures.
SECTION 2.6. DECLARATION OF TRUST.
The exclusive purposes and functions of the Issuer Trust are to (a)
issue and sell Trust Securities and use the proceeds from such sale to acquire
the Junior Subordinated Debentures, and (b) engage in only those other
activities necessary, convenient or incidental thereto. The Depositor hereby
appoints the Issuer Trustees as trustees of the Issuer Trust, to have all the
rights,
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powers and duties to the extent set forth herein, and the Issuer Trustees 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 Issuer Trust and the Holders. The Depositor hereby
appoints the Administrators, with such Administrators having all rights, powers
and duties set forth herein with respect to accomplishing the purposes of the
Issuer Trust, and the Administrators hereby accept such appointment; provided,
however, that it is the intent of the parties hereto that such Administrators
shall not be trustees or, to the fullest extent permitted by law, fiduciaries
with respect to the Issuer Trust and this Trust Agreement shall be construed in
a manner consistent with such intent. The Property Trustee shall have the right
and power 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 Issuer Trust for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Business Trust Act and for taking
such actions as are required to be taken by a Delaware trustee under the
Delaware Business Trust Act.
SECTION 2.7. AUTHORIZATION TO ENTER INTO CERTAIN TRANSACTIONS.
(a) The Issuer Trustees and the Administrators shall conduct the
affairs of the Issuer 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), (ii) and (iii), the Issuer
Trustees and the Administrators shall act as follows:
(i) each Administrator, acting jointly or singly, shall:
(A) comply with the Purchase Agreement regarding the issuance and
sale of the Trust Securities;
(B) assist in compliance with the Securities Act, applicable
state securities or blue sky laws, and the Trust Indenture Act;
(C) assist in the listing of the Capital Securities upon such
securities exchange or exchanges as shall be determined by the
Depositor, with the registration of the Capital Securities under
the Exchange Act, if required, and the preparation and filing of
all periodic
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and other reports and other documents pursuant to the foregoing;
(D) execute the Trust Securities on behalf of the Issuer Trust in
accordance with this Trust Agreement;
(E) execute and deliver an application for a taxpayer
identification number for the Issuer Trust;
(F) execute the Registration Rights Agreement on behalf of the
Issuer Trust;
(G) execute and file with the Commission, at such time as
determined by the Depositor, any registration statement, including
any amendments thereto, as contemplated by the Registration Rights
Agreement;
(H) unless otherwise required by the Delaware Business Trust Act
or the Trust Indenture Act, execute on behalf of the Issuer Trust
any documents that the Administrators have the power to execute
pursuant to this Trust Agreement, including without limitation, the
Debentures Purchase Agreement and the Common Securities Purchase
Agreement; and
(I) take any action incidental to the foregoing as necessary or
advisable to give effect to the terms of this Trust Agreement.
(ii) The Property Trustee shall have the power and authority to act on
behalf of the Issuer Trust with respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Junior Subordinated Debentures;
(C) the receipt and collection of interest, principal and any
other payments made in respect of the Junior Subordinated
Debentures in the Payment Account;
(D) the distribution of amounts owed to the Holders in respect of
the Trust Securities;
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(E) the exercise of all of the rights, powers and privileges of a
holder of the Junior Subordinated Debentures;
(F) the sending of notices of default and other information
regarding the Trust Securities and the Junior Subordinated
Debentures to the Holders 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 Issuer Trust
and the preparation, execution and filing of the certificate of
cancellation with the Secretary of State of the State of Delaware;
and
(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), comply with
the provisions of this Trust Agreement and take any action to give
effect to the terms of this Trust Agreement and protect and
conserve the Trust Property for the benefit of the Holders (without
consideration of the effect of any such action on any particular
Holder);
provided, however, that nothing in this Section 2.7(a)(ii) shall
require the Property Trustee to take any action that is not otherwise
required in this Trust Agreement.
(iii) The Property Trustee shall comply with the listing requirements
of the Capital Securities upon such securities exchange or exchanges as
shall be determined by the Depositor, the registration of the Capital
Securities under the Exchange Act, if required, and the preparation and
filing of all periodic and other reports and other documents pursuant
to the foregoing.
(b) So long as this Trust Agreement remains in effect, the Issuer
Trust (or the Issuer Trustees or Administrators acting on behalf of the Issuer
Trust) shall not undertake any business, activities or transaction except as
expressly provided herein or contemplated hereby. In particular, neither the
Issuer Trustees nor the Administrators shall (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement,
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(ii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise
dispose of any of the Trust Property or interests therein, including to Holders,
except as expressly provided herein, (iii) take any action that would cause the
Issuer Trust to become taxable other than 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 Issuer Trust or the
Holders in their capacity as Holders.
(c) In connection with the issue and sale of the Capital Securities,
the Depositor shall have the right and responsibility to assist the Issuer Trust
with respect to, or effect on behalf of the Issuer 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 by the Issuer Trust of an offering memorandum in
relation to the Capital Securities, including any amendments thereto
and the taking of any action necessary or desirable to sell the Capital
Securities in a transaction or a series of transactions exempt from the
registration requirements of the Securities Act;
(ii) the determination of the states in which to take appropriate
action to qualify or register for sale all or part of the Capital
Securities and the determination of any and all such acts, other than
actions that must be taken by or on behalf of the Issuer Trust, and the
advice to the Issuer Trustees of actions they must take on behalf of
the Issuer Trust, and the preparation for execution and filing of any
documents to be executed and filed by the Issuer Trust or on behalf of
the Issuer Trust, as the Depositor deems necessary or advisable in
order to comply with the applicable laws of any such States in
connection with the sale of the Capital Securities;
(iii) the negotiation of the terms of, and the execution and delivery
of, the Purchase Agreement providing for the sale of the Capital
Securities; and
(iv) the taking of any other actions necessary or desirable to carry
out any of the foregoing activities.
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(d) Notwithstanding anything herein to the contrary, the
Administrators and the Property Trustee are authorized and directed to conduct
the affairs of the Issuer Trust and to operate the Issuer Trust so that the
Issuer Trust will not be deemed to be an "investment company" required to be
registered under the Investment Company Act, and will not be taxable other than
as a grantor trust for the United States Federal income tax purposes and so that
the Junior Subordinated Debentures will be treated as indebtedness of the
Depositor for United States Federal income tax purposes. In this connection, the
Property Trustee and the Holders of Common Securities are authorized to take any
action, not inconsistent with applicable law, the Certificate of Trust or this
Trust Agreement, that the Property Trustee and Holders of Common Securities
determine in their discretion to be necessary or desirable for such purposes, as
long as such action does not adversely affect in any material respect the
interests of the holders of the Outstanding Capital Securities. In no event
shall the Administrators or the Issuer Trustees be liable to the Issuer Trust or
the Holders for any failure to comply with this Section that results from a
change in law or regulations or in the interpretation thereof.
SECTION 2.8. ASSETS OF TRUST.
The assets of the Issuer Trust shall consist solely 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 Issuer Trust and the Holders 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 its agents shall have
exclusive control and sole right of withdrawal with respect to the Payment
Account for the purpose of making deposits in and withdrawals from the Payment
Account in accordance with this Trust Agreement. All monies 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 Holders
and for distribution as herein
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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 Junior Subordinated 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) The Trust Securities represent undivided beneficial interests in
the Trust Property, and Distributions (including of Additional Amounts) will be
made on the Trust Securities at the rate and on the dates that payments of
interest (including of Additional Interest, as defined in the Indenture) are
made on the Junior Subordinated Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative and will
accumulate whether or not there are funds of the Issuer Trust available
for the payment of Distributions. Distributions shall accumulate from
March 5, 1998, and, except in the event (and to the extent) that the
Depositor exercises its right to defer the payment of interest on the
Junior Subordinated Debentures pursuant to the Indenture, shall be
payable semi-annually in arrears on March 1 and September 1 of each
year, commencing on September 1, 1998. 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 (without any additional
Distributions or other payment in respect of any such delay), with the
same force and effect as if made on the date on which such payment was
originally payable (each date on which distributions are payable in
accordance with this Section 4.1(a), a "Distribution Date").
(ii) The Trust Securities shall be entitled to Distributions payable at
a rate of 8.05% per annum of the Liquidation Amount of the Trust
Securities. The amount of Distributions payable for any period less
than a full Distribution period shall be computed on the basis of a
360-day year of twelve 30-day months and the actual number of days
elapsed in a partial month in a period. Distributions payable for each
full Distribution period
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will be computed by dividing the rate per annum by two. The amount of
Distributions payable for any period shall include any Additional
Amounts in respect of such period.
(iii) So long as no Debenture Event of Default has occurred and is
continuing, the Depositor has the right under the Indenture to defer
the payment of interest on the Junior Subordinated Debentures at any
time and from time to time for a period not exceeding 10 consecutive
semi-annual periods (an "Extension Period"), provided that no Extension
Period may extend beyond March 1, 2028. As a consequence of any such
deferral, semi-annual Distributions on the Trust Securities by the
Trust will also be deferred (and the amount of Distributions to which
Holders of the Trust Securities are entitled will accumulate additional
Distributions thereon at a rate of 8.05% per annum, compounded
semi-annually from the relevant payment date for such Distributions,
computed on the basis of a 360-day year of twelve 30-day months and the
actual days elapsed in a partial month in such period). Additional
Distributions payable for each full Distribution period will be
computed by dividing the rate per annum by two. The term
"Distributions" as used in Section 4.1 shall include any such
additional Distributions provided pursuant to this Section 4.1(a)(iii).
(iv) 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 Issuer Trust has funds
then on hand and available in the Payment Account for the payment of
such Distributions.
(b) 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 at the close of business on the
relevant record date, which shall be at the close of business on February 15 or
August 15 (whether or not a Business Day).
SECTION 4.2. REDEMPTION.
(a) On each Debenture Redemption Date and on the stated maturity of
the Junior Subordinated Debentures, the Issuer 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
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each Holder of Trust Securities to be redeemed, 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 is required to be sent, the
estimate of the Redemption Price provided pursuant to the Indenture
together with a statement that it is an estimate and that the actual
Redemption Price will be calculated on the third Business Day prior to
the Redemption Date (and if an estimate is provided, a further notice
shall be sent of the actual Redemption Price on the date, or as soon as
practicable thereafter, that notice of such actual Redemption Price is
received pursuant to the Indenture);
(iii) the CUSIP number or CUSIP numbers of the Capital Securities
affected;
(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;
(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,
except as provided in Section 4.2(d) below; and
(vi) the place or places where Trust Securities are to be surrendered
for the payment of the Redemption Price.
The Issuer Trust in issuing the Trust Securities may use "CUSIP" or
"private placement" numbers (if then generally in use), and, if so, the Property
Trustee shall indicate the "CUSIP" or "private placement" numbers of the Trust
Securities in notices of redemption and related materials 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 Trust Securities
or as contained in any notice of redemption and related material.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the applicable proceeds from the
contemporaneous redemption of Junior Subordinated 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 Issuer Trust has funds then on hand
and
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available in the Payment Account for the payment of such Redemption Price.
(d) If the Issuer Trust gives a notice of redemption in respect of any
Capital Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, subject to Section 4.2(c), the Property Trustee will, with respect to
Capital Securities held in global form, irrevocably deposit with the Clearing
Agency for such Capital Securities, to the extent available therefor, 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 of the Capital Securities. With respect to Capital Securities that are
not held in global form, the Property Trustee, subject to Section 4.2(c), will
irrevocably deposit with the Paying Agent, to the extent available therefor,
funds sufficient to pay the applicable Redemption Price and will give the Paying
Agent irrevocable instructions and authority to pay the Redemption Price to the
Holder of the Capital Securities upon surrender of their Capital 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 Dates. If notice of redemption shall have been given and funds
deposited as required, then, upon the date of such deposit, all rights of
Holders holding Trust Securities so called for redemption will cease, except the
right of such Holders to receive the Redemption Price and any Distribution
payable in respect of the Trust Securities 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 applicable Redemption Price is payable is
not a Business Day, then payment of the applicable 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 Issuer Trust or by the
Depositor pursuant to the Guarantee, Distributions on such Trust Securities will
continue to accumulate, as set forth in Section 4.1 and in accordance with the
continued accrual of interest on the Junior Subordinated Debentures, from the
Redemption Date originally established by the Issuer Trust for such Trust
Securities to the date such applicable Redemption Price is actually paid, in
which case the actual payment date will be the date fixed for redemption for
purposes of calculating the applicable Redemption Price.
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(e) 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 such Trust Securities to be redeemed shall be allocated
pro rata to the Common Securities and the Capital Securities based on the
relative Liquidation Amounts of such classes, subject to the requirement that no
Holder shall hold Capital Securities with an aggregate Liquidation Amount of
less than $100,000 after such redemption. The particular Capital Securities to
be redeemed shall be selected on a pro rata basis based on their respective
Liquidation Amounts not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Capital Securities not previously called
for redemption, or if the Capital Securities are then held in the form of a
Global Capital Security in accordance with the customary procedures for the
Clearing Agency, provided that, after giving effect to such redemption, no
Holder shall hold Capital Securities with an aggregate Liquidation Amount of
less than $100,000, provided, however, that with respect to Holders that would
be required to hold less than 100 but more than zero Capital Securities as a
result of such pro rata redemption, the Property Trustee shall redeem each such
Holder to either 100 Capital Securities or zero Capital Securities and shall use
such method (including, without limitation, by lot) as the Property Trustee
shall deem fair and appropriate. The Property Trustee shall promptly notify the
Securities Registrar in writing of the Capital Securities selected for
redemption and, in the case of any Capital 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 Capital Securities shall relate, in the case of
any Capital Securities redeemed or to be redeemed only in part, to the portion
of the aggregate Liquidation Amount of Capital Securities that has been or is to
be redeemed.
SECTION 4.3. SUBORDINATION OF COMMON SECURITIES.
(a) Payment of Distributions (including Additional Amounts, if
applicable) on, the Redemption Price of, and the Liquidation Distribution in
respect of, the Trust Securities, as applicable, shall be made, subject to
Section 4.2(e), pro rata among the Common Securities and the Capital Securities
based on the Liquidation Amount of such Trust Securities; provided, however,
that if on any Distribution Date or Redemption Date any Event of Default
resulting from a Debenture Event of Default in Section 5.1(1) or 5.1(2) of the
Indenture shall have occurred and be continuing, no payment of any Distribution
(including any Additional Amounts) on, Redemption Price of, or Liquidation
Distribution in respect 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
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any Additional Amounts) on all Outstanding Capital 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 Capital Securities then called for redemption, or in the case of
payment of the Liquidation Distribution the full amount of such Liquidation
Distribution on all Outstanding Capital Securities, 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
any Additional Amounts) on, or the Redemption Price of, or Liquidation
Distribution in respect of, Capital Securities then due and payable. The
existence of an Event of Default does not entitle the Holders of Capital
Securities to accelerate the maturity thereof.
(b) In the case of the occurrence of any Event of Default resulting
from any Debenture Event of Default, the Holders of the Common Securities shall
be deemed to have waived any right to act with respect to any such Event of
Default under this Trust Agreement until the effects of all such Events of
Default with respect to the Capital Securities have been cured, waived or
otherwise eliminated. Until all such Events of Default under this Trust
Agreement with respect to the Capital Securities have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Capital Securities and not on behalf of the Holder of the Common
Securities, and only the Holders of the Capital Securities will have the right
to direct the Property Trustee to act on their behalf.
SECTION 4.4. PAYMENT PROCEDURES.
Payments of Distributions (including any Additional Amounts) in respect
of the Capital 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 Capital Securities are held by a Clearing Agency, such Distributions
shall be made to the Clearing Agency in immediately available funds, which will
credit the relevant accounts on the applicable Distribution Dates. Payments of
Distributions to Holders of $1,000,000 or more in aggregate Liquidation Amount
of Capital Securities may be made by wire transfer of immediately available
funds upon written request of such Holder to the Securities Registrar not later
than 15 calendar days prior to the date on which the Distribution is payable.
Payments in respect of the Common Securities shall be made in such manner as
shall be mutually agreed between the Property Trustee and the Holder of the
Common Securities.
SECTION 4.5. TAX RETURNS AND REPORTS.
The Administrators shall prepare (or cause to be
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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 Issuer Trust. In this regard, the Administrators shall (a)
prepare and file (or cause to be prepared and filed) all Internal Revenue
Service forms required to be filed in respect of the Issuer Trust in each
taxable year of the Issuer Trust and (b)prepare and furnish (or cause to be
prepared and furnished) to each Holder all Internal Revenue Service forms
required to be provided by the Issuer Trust. 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 Issuer Trustees shall
comply with United States Federal withholding and backup withholding tax laws
and information reporting requirements with respect to any payments to Holders
under the Trust Securities.
On or before December 15 of each year during which any Capital
Securities are outstanding, the Administrators shall furnish to the Paying Agent
such information as may be reasonably requested by the Property Trustee in order
that the Property Trustee may prepare the information which it is required to
report for such year on Internal Revenue Service Forms 1096 and 1099 pursuant to
Section 6049 of the Code. Such information shall include the amount of original
issue discount includable in income for each outstanding Capital Security during
such year, if any.
SECTION 4.6. PAYMENT OF TAXES, DUTIES, ETC. OF THE ISSUER TRUST.
Upon receipt under the Junior Subordinated Debentures of Additional
Sums, the Property Trustee shall promptly pay any taxes, duties or governmental
charges of whatsoever nature (other than withholding taxes) imposed on the
Issuer Trust by the United States or any other taxing authority.
SECTION 4.7. PAYMENTS UNDER INDENTURE OR PURSUANT TO DIRECT ACTIONS.
Any amount payable hereunder to any Holder of Capital Securities shall
be reduced by the amount of any corresponding payment such Holder has directly
received pursuant to Section 5.8 of the Indenture or Section 5.13 of this Trust
Agreement.
SECTION 4.8. LIABILITY OF THE HOLDER OF COMMON SECURITIES.
The Holder of Common Securities shall be liable for the debts and
obligations of the Issuer Trust as set forth in Section 6.7 of the Indenture
regarding allocation of expenses.
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ARTICLE V
TRUST SECURITIES CERTIFICATES
SECTION 5.1. INITIAL OWNERSHIP.
Upon the creation of the Issuer 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 Issuer Trust.
SECTION 5.2. THE TRUST SECURITIES CERTIFICATES.
(a) The Capital Securities Certificates shall be issued in fully
registered form in minimum blocks of at least 100 (representing a minimum of
$100,000 aggregate Liquidation Amount and multiples of $1,000 in excess
thereof), and shall be at all times held in minimum blocks of 100, and the
Common Securities Certificates shall be issued in minimum blocks of 100
(representing a minimum of $100,000 aggregate Liquidation Amount). The Trust
Securities Certificates shall be executed on behalf of the Issuer Trust by
manual or facsimile signature of at least one Administrator except as provided
in Section 5.3. Trust Securities Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Issuer 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 Holder, and shall be
entitled to the rights and subject to the obligations of a Holder hereunder,
upon due registration of such Trust Securities Certificate in such transferee's
name pursuant to Section 5.5.
(b) Upon their original issuance, Capital Securities Certificates
representing Rule 144A Capital Securities shall be issued in the form of a
Global Capital Securities Certificate registered in the name of Cede as
Depositary's nominee and deposited with or on behalf of Depositary for credit by
Depositary to the respective accounts of the Owners thereof (or such other
accounts as they may direct). Except as set forth herein, record ownership of
the Global Capital Security may be transferred, in whole or in part, only to
another nominee of Depository or to a successor of Depository or its nominee.
(c) Upon their original issuance, Capital Securities Certificates
representing Other Capital Securities shall be issued
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in definitive form and may not be represented by the Global Capital Security.
(d) 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 5.3. EXECUTION AND DELIVERY OF TRUST SECURITIES CERTIFICATES.
At the Closing Time, an Administrator 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 Issuer Trust and delivered to the Property
Trustee and upon such delivery the Property Trustee shall authenticate such
Trust Securities Certificates and deliver such Trust Securities Certificates
upon the written order of the Trust, executed by an Administrator thereof,
without further corporate action by the Depositor, in authorized denominations.
SECTION 5.4. GLOBAL CAPITAL SECURITY.
(a) The Global Capital Security issued under this Trust Agreement
shall be registered in the name of the nominee of the Clearing Agency and
delivered to such custodian therefor, and such Global Capital Security shall
constitute a single Capital Security for all purposes of this Trust Agreement.
(b) Notwithstanding any other provision in this Trust Agreement, the
Global Capital Security may not be exchanged in whole or in part for Capital
Securities registered, and no transfer of the Global Capital Security in whole
or in part may be registered, in the name of any Person other than the Clearing
Agency for such Global Capital Security, Cede, or other nominee thereof unless
(i) such Clearing Agency advises the Depositor and the Property Trustee in
writing that such Clearing Agency is no longer willing or able to properly
discharge its responsibilities as Clearing Agency with respect to such Global
Capital Security, and the Depositor is unable to locate a qualified successor,
(ii) the Issuer Trust at its option advises the Depositary in writing that it
elects to terminate the book-entry system through the Clearing Agency, or (iii)
there shall have occurred and be continuing an Event of Default.
(c) If the Global Capital Security is to be exchanged for Other
Capital Securities or canceled in whole, it shall be surrendered by or on behalf
of the Clearing Agency or its nominee to the Securities Registrar for exchange
or cancellation as provided in this Article V. If the Global Capital Security is
to be exchanged for Other Capital Securities or canceled in part, or if another
Capital Security is to be exchanged in whole or in part
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for a beneficial interest in the Global Capital Security, then either (i) such
Global Capital Security shall be so surrendered for exchange or cancellation as
provided in this Article V or (ii) the Liquidation Amount thereof shall be
reduced or increased by an amount equal to the portion thereof to be so
exchanged or canceled or equal to the Liquidation Amount of such other Capital
Security to be so exchanged for a beneficial interest therein, as the case may
be, by means of an appropriate adjustment made on the records of the Security
Registrar, whereupon the Property Trustee, in accordance with the Applicable
Procedures, shall instruct the Clearing Agency or its authorized representative
to make a corresponding adjustment to its records. Upon any such surrender or
adjustment of the Global Capital Security by the Clearing Agency, accompanied by
registration instructions, the Property Trustee shall, subject to Section 5.4(b)
and as otherwise provided in this Article V, authenticate and deliver any
Capital Securities issuable in exchange for such Global Capital Security (or any
portion thereof) in accordance with the instructions of the Clearing Agency. The
Property Trustee shall not be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be fully protected in
relying on, such instructions.
(d) Every Capital Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, the Global
Capital Security or any portion thereof, whether pursuant to this Article V or
Article IV or otherwise, shall be authenticated and delivered in the form of,
and shall be, a Global Capital Security, unless such Global Capital Security is
registered in the name of a Person other than the Clearing Agency for such
Global Capital Security or a nominee thereof.
(e) The Clearing Agency or its nominee, as the registered owner of the
Global Capital Security, shall be considered the Holder of the Capital
Securities represented by the Global Capital Security for all purposes under
this Trust Agreement and the Capital Securities, and owners of beneficial
interests in the Global Capital Security shall hold such interests pursuant to
the Applicable Procedures and, except as otherwise provided herein, shall not be
entitled to have any of the individual Capital Securities represented by the
Global Security registered in their names, shall not receive nor be entitled to
receive physical delivery of any such Capital Securities in definitive form and
shall not be considered the Holders thereof under this Trust Agreement.
Accordingly, any such owner's beneficial interest in the Global Capital Security
shall be shown only on, and the transfer of such interest shall be effected only
through, records maintained by the Clearing Agency or its nominee. Neither the
Property Trustee nor the Securities Registrar shall have any liability in
respect of any transfers effected by the Clearing Agency.
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(f) The rights of owners of beneficial interests in the Global Capital
Security 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.
SECTION 5.5. REGISTRATION OF TRANSFER AND EXCHANGE GENERALLY; CERTAIN
TRANSFERS AND EXCHANGES; CAPITAL SECURITIES CERTIFICATES; SECURITIES ACT
LEGENDS.
(a) The Property Trustee shall keep or cause to be kept at its
Corporate Trust Office a register or registers for the purpose of registering
Capital Securities Certificates and transfers and exchanges of Capital
Securities Certificates in which the registrar and transfer agent with respect
to the Capital Securities (the "Securities Registrar"), subject to such
reasonable regulations as it may prescribe, shall provide for the registration
of Capital Securities Certificates and Common Securities Certificates (subject
to Section 5.11 in the case of Common Securities Certificates) and registration
of transfers and exchanges of Capital Securities Certificates as herein
provided. Such register is herein sometimes referred to as the "Securities
Register." The Property Trustee is hereby appointed Securities Registrar for the
purpose of registering Capital Securities and transfers of Capital Securities as
herein provided.
Upon surrender for registration of transfer of any Capital Security at
the offices or agencies of the Property Trustee designated for that purpose the
Administrators shall execute, and the Property Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Capital Securities of the same series of any authorized denominations of
like tenor and aggregate principal amount and bearing such restrictive legends
as may be required by this Trust Agreement.
At the option of the Holder, Capital Securities may be exchanged for
other Capital Securities of any authorized denominations, of like tenor and
aggregate Liquidation Amount and bearing such restrictive legends as may be
required by this Trust Agreement, upon surrender of the Capital Securities to be
exchanged at such office or agency. Whenever any securities are so surrendered
for exchange, the Administrators shall execute and the Property Trustee shall
authenticate and deliver the Capital Securities that the Holder making the
exchange is entitled to receive.
All Capital Securities issued upon any transfer or exchange of Capital
Securities shall be the valid obligations of the Issuer Trust, evidencing the
same debt, and entitled to the same benefits under this Trust Agreement, as the
Capital Securities surrendered upon such transfer or exchange.
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Every Capital Security presented or surrendered for transfer or
exchange shall (if so required by the Property Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Property Trustee and the Securities Registrar, duly executed by the Holder
thereof or such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Capital Securities, but the Property Trustee may require payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Capital Securities.
Neither the Issuer Trust nor the Property Trustee shall be required,
pursuant to the provisions of this Section, (i) to issue, register the transfer
of or exchange any Capital Security during a period beginning at the opening of
business 15 days before the day of selection for redemption of Capital
Securities pursuant to Article IV and ending at the close of business on the day
of mailing of the notice of redemption, or (ii) to register the transfer of or
exchange any Capital Security so selected for redemption in whole or in part,
except, in the case of any such Capital Security to be redeemed in part, any
portion thereof not to be redeemed.
(b) CERTAIN TRANSFERS AND EXCHANGES. Notwithstanding any other
provision of this Trust Agreement, transfers and exchanges of Capital Securities
and beneficial interests in a Global Capital Security shall be made only in
accordance with this Section 5.5(b).
(i) NON-GLOBAL RESTRICTED CAPITAL SECURITY TO GLOBAL SECURITY. If the
Holder of a Restricted Capital Security (other than the Global Capital
Security) wishes at any time to transfer all or any portion of such
Trust Security to a Person who wishes to take delivery thereof in the
form of a beneficial interest in the Global Security, such transfer may
be effected only in accordance with the provisions of this clause
(b)(i) and subject to the Applicable Procedures. Upon receipt by the
Security Registrar of (A) such Trust Security as provided in Section
5.5(a) and instructions satisfactory to the Security Registrar
directing that a beneficial interest in the Global Security in a
specified Liquidation Amount not greater than the Liquidation Amount of
such Trust Security to be credited to a specified Clearing Agency
Participant's account and (B) a Restricted Trust Securities Certificate
duly executed by such Holder or such Holder's attorney duly authorized
in writing, then the Security Registrar shall cancel such Trust
Security (and issue a new Trust Security in respect
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of any untransferred portion thereof) as provided in Section 5.5(a) and
increase the aggregate Liquidation Amount of the Global Capital
Security by the specified Liquidation Amount as provided in Section
5.4(c).
(ii) NON-GLOBAL CAPITAL SECURITY TO NON-GLOBAL CAPITAL SECURITY. A
Trust Security that is not a Global Capital Security may be
transferred, in whole or in part, to a Person who takes delivery in the
form of another Trust Security that is not a Global Security as
provided in Section 5.5(a) provided that if the Trust Security to be
transferred in whole or in part is a Restricted Capital Security, the
Securities Registrar shall have received a Restricted Securities
Certificate duly executed by the transferor Holder or such Holder's
attorney duly authorized in writing.
(iii) EXCHANGES BETWEEN GLOBAL CAPITAL SECURITY AND NON-GLOBAL TRUST
Security. A beneficial interest in the Global Capital Security may be
exchanged for a Trust Security that is not a Global Capital Security as
provided in Section 5.4.
(iv) CERTAIN INITIAL TRANSFERS OF NON-GLOBAL TRUST SECURITIES. In the
case of Trust Securities initially issued other than in global form, an
initial transfer or exchange of such Trust Securities that does not
involve any change in beneficial ownership may be made to an
Institutional Accredited Investor or Investors as if such transfer or
exchange were not an initial transfer or exchange; provided that
written certification shall be provided by the transferee and
transferor of such Trust Securities to the Securities Registrar that
such transfer or exchange does not involve a change in beneficial
ownership.
(v) LIMITATIONS RELATING TO PRINCIPAL AMOUNT. Notwithstanding any other
provision of this Trust Agreement and unless otherwise specified as
permitted by this Trust Agreement, Trust Securities or portions thereof
may be transferred or exchanged only in principal amounts of not less
than $100,000. Any transfer, exchange or other disposition of Trust
Securities in contravention of this Section 5.5(b)(v) shall be deemed
to be void and of no legal effect whatsoever, any such transferee shall
be deemed not to be the Holder or owner of any beneficial interest in
such Trust Securities for any purpose, including but not limited to the
receipt of interest payable on such Trust Securities, and such
transferee shall be deemed to have no interest whatsoever in such Trust
Securities.
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(c) RESTRICTED SECURITIES LEGEND. Except as set forth below, all
Capital Securities shall bear a Restricted Capital Securities Legend:
(i) subject to the following Clauses of this Section 5.5(c), a Capital
Security or any portion thereof that is exchanged, upon transfer or
otherwise, for a Global Capital Security or any portion thereof shall
bear the Restricted Capital Securities Legend while represented
thereby;
(ii) subject to the following Clauses of this Section 5.5(c), a new
Capital Security which is not a Global Capital Security and is issued
in exchange for another Capital Security (including a Global Capital
Security) or any portion thereof, upon transfer or otherwise, shall, if
such new Capital Security is required to be issued in the form of a
Restricted Capital Security, bear a Restricted Capital Securities
Legend;
(iii) a new Capital Security (other than a Global Capital Security)
that does not bear a Restricted Capital Securities Legend may be issued
in exchange for or in lieu of a Restricted Capital Security or any
portion thereof that bears such a legend if, in the Depositor's
judgment, placing such a legend upon such new Capital Security is not
necessary to ensure compliance with the registration requirements of
the Securities Act, and the Property Trustee, at the written direction
of the Issuer Trust in the form of an Officers' Certificate, shall
authenticate and deliver such new Capital Security as provided in this
Article V;
(iv) notwithstanding the foregoing provisions of this Section 5.5(c), a
Successor Capital Security of a Capital Security that does not bear a
Restricted Capital Securities Legend shall not bear such form of legend
unless the Depositor has reasonable cause to believe that such
Successor Capital Security is a "restricted security" within the
meaning of Rule 144 under the Securities Act, in which case the
Property Trustee, at the written direction of the Issuer Trust in the
form of an Officers' Certificate, shall authenticate and deliver a new
Capital Security bearing a Restricted Capital Securities Legend in
exchange for such Successor Capital Security as provided in this
Article V; and
(v) Trust Securities distributed to a holder of Capital Securities upon
dissolution of the Issuer Trust shall bear a Restricted Capital
Securities Legend if the
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Capital Securities so held bear a similar legend.
(d) EXCHANGE OF CAPITAL SECURITIES. The Capital Securities may be
exchanged for other capital securities (the "Exchange Capital Securities")
pursuant to the terms of the Exchange Offer. In such an exchange, the Property
Trustee shall make the exchange as follows:
The Depositor shall present the Property Trustee with an Officers'
Certificate certifying as follows:
(i) upon issuance of the Exchange Capital Securities, the transactions
contemplated by the Exchange Offer have been consummated; and
(ii) the number of Capital Securities properly tendered in the Exchange
Offer that are represented by a Global Capital Security and the number of
Capital Securities properly tendered in the Exchange Offer that are represented
by definitive Capital Securities, the name of each Holder of such definitive
Capital Securities, the Liquidation Amount of Capital Securities properly
tendered in the Exchange Offer by each such Holder and the name and address to
which definitive Capital Securities for Exchange Capital Securities shall be
registered and sent for each such Holder.
The Property Trustee, upon receipt of (i) such Officers' Certificate
and (ii) an Opinion of Counsel (x) to the effect that the Exchange Capital
Securities have been registered under the Securities Act and the Trust Agreement
has been qualified under the Trust Indenture Act and (y) with respect to the
matters set forth in the Registration Rights Agreement, shall authenticate (A) a
Global Capital Security representing the Exchange Capital Securities in
aggregate Liquidation Amount equal to the aggregate Liquidation Amount of the
Capital Securities so exchanged represented by a Global Capital Security
indicated in such Officers' Certificate and (B) definitive Capital Securities
representing the Exchange Capital Securities registered in the names of, and in
the Liquidation Amounts indicated in such Officers' Certificate.
If, upon consummation of the Exchange Offer, less than all the then
outstanding Capital Securities shall have properly tendered and not withdrawn,
the Property Trustee shall reflect on the Securities Register such untendered
Capital Securities indicating the reduction in the number and aggregate
Liquidation Amount represented thereby as a result of the Exchange Offer.
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SECTION 5.6. 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 Issuer Trust shall
execute and make available for delivery, and the Property Trustee shall
authenticate, 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 assets
of the Issuer Trust corresponding to that evidenced by the lost, stolen or
destroyed Trust Securities Certificate, as if originally issued, whether or not
the lost, stolen or destroyed Trust Securities Certificate shall be found at any
time.
SECTION 5.7. PERSONS DEEMED HOLDERS.
The Issuer Trustees or the Securities Registrar shall treat the Person
in whose name any Trust Securities are issued as the owner of such Trust
Securities for the purpose of receiving Distributions and for all other purposes
whatsoever, and none of the Issuer Trustees, the Administrators nor the
Securities Registrar shall be bound by any notice to the contrary.
SECTION 5.8. ACCESS TO LIST OF HOLDERS' NAMES AND ADDRESSES.
Each Holder 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 5.9. MAINTENANCE OF OFFICE OR AGENCY.
The Property Trustee shall designate, with the consent of the
Administrators, which consent shall not be unreasonably
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withheld, an office or offices or agency or agencies where Capital Securities
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Issuer Trustees in respect of the Trust
Securities Certificates may be served. The Property Trustee initially designates
its Corporate Trust Office at Four Albany Street, New York, NY 10006, Attention:
Corporate Trust and Agency Group - Corporate Market Services, as its corporate
trust office for such purposes. The Property Trustee shall give prompt written
notice to the Depositor, the Administrators and to the Holders of any change in
the location of the Securities Register or any such office or agency.
SECTION 5.10. APPOINTMENT OF PAYING AGENT.
The Paying Agent shall make Distributions to Holders 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 solely for the purpose of making the
Distributions referred to above. The Property Trustee may revoke such power and
remove any Paying Agent in its sole discretion. The Paying Agent shall initially
be the Property Trustee. Any Person acting as Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Administrators, and
the Property Trustee. In the event that the Property Trustee shall no longer be
the Paying Agent or a successor Paying Agent shall resign or its authority to
act be revoked, the Property Trustee shall appoint a successor (which shall be a
bank or trust company) that is reasonably acceptable to the Administrators to
act as Paying Agent. Such successor Paying Agent or any additional Paying Agent
appointed by the Administrators shall execute and deliver to the Issuer Trustees
an instrument in which such successor Paying Agent or additional Paying Agent
shall agree with the Issuer 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 Holders in trust for the benefit of the Holders entitled thereto
until such sums shall be paid to such Holders. 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 8.1, 8.3 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 chosen by the Property Trustee unless the context
requires otherwise.
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SECTION 5.11. OWNERSHIP OF COMMON SECURITIES BY DEPOSITOR.
At each Closing Time, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. Neither the Depositor nor any
successor Holder of the Common Securities may transfer less than all the Common
Securities, and the Depositor or any such successor Holder may transfer the
Common Securities only (i) in connection with a consolidation or merger of the
Depositor into another corporation or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 8.1 of the Indenture, or (ii) to an Affiliate of the
Depositor in compliance with applicable law (including the Securities Act and
applicable state securities and blue sky laws). To the fullest extent permitted
by law, any attempted transfer of the Common Securities, other than as set forth
in the immediately preceding sentence, shall be void. The Administrators shall
cause each Common Securities Certificate issued to the Depositor to contain a
legend stating "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE DEPOSITOR OR
AN AFFILIATE OF THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11
OF THE TRUST AGREEMENT."
SECTION 5.12. NOTICES TO CLEARING AGENCY.
To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as Capital Securities are
represented by a Global Capital Securities Certificate, the Administrators and
the Issuer Trustees shall give all such notices and communications specified
herein to be given to the Clearing Agency, and shall have no obligations to the
Owners.
SECTION 5.13. RIGHTS OF HOLDERS.
(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 Holders shall not have any right or title therein other than the undivided
beneficial ownership interest in the assets of the Issuer 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 Issuer 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 and when issued and delivered to
Holders against payment of the purchase price therefor, as provided herein, will
be fully paid and nonassessable by the Issuer Trust. Except as otherwise
provided in Section 4.8, the Holders of the Trust Securities, in their
capacities as such, shall be entitled to the same limitation of personal
liability extended to
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stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
(b) For so long as any Capital 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 Junior Subordinated
Debentures fail to declare the principal of all of the Junior Subordinated
Debentures to be immediately due and payable, the Holders of at least 25% in
Liquidation Amount of the Capital Securities then Outstanding shall have such
right to make such declaration by a notice in writing to the Property Trustee,
the Depositor and the Debenture Trustee.
At any time after such a declaration of acceleration with respect to
the Junior Subordinated 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 Capital 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 on all of the Junior
Subordinated Debentures,
(B) any accrued Additional Interest on all of the Junior
Subordinated Debentures,
(C) the principal of (and premium, if any, on) any Junior
Subordinated Debentures which have become due otherwise than by
such declaration of acceleration and interest and Additional
Interest thereon at the rate borne by the Junior Subordinated
Debentures, and
(D) 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
(ii) all Events of Default with respect to the Junior Subordinated
Debentures, other than the non-payment of the principal of the Junior
Subordinated Debentures which has become due solely by such
acceleration, have been cured or waived as provided in Section 5.13 of
the Indenture.
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If the Property Trustee fails to annul any such declaration and waive
such default, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities shall also have the right to rescind and annul such
declaration and its consequences by written notice to the Depositor, the
Property Trustee and the Debenture Trustee, subject to the satisfaction of the
conditions set forth in clauses (i) and (ii) of this Section 5.13(b).
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, on behalf of the Holders of all the Capital 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 Junior
Subordinated Debentures. No such rescission shall affect any subsequent default
or impair any right consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the Capital
Securities all or part of which is represented by Global Capital Securities, a
record date shall be established for determining Holders of Outstanding Capital
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 5.13(b).
(c) For so long as any Capital Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a
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Debenture Event of Default specified in Section 5.1(1) or 5.1(2) of the
Indenture, any Holder of Capital Securities shall have the right to institute a
proceeding directly against the Depositor, pursuant to Section 5.8 of the
Indenture, for enforcement of payment to such Holder of the principal amount of
or interest on Junior Subordinated Debentures having an aggregate principal
amount equal to the aggregate Liquidation Amount of the Capital Securities of
such Holder (a "Direct Action"). Except as set forth in Sections 5.13(b) and
5.13(c), the Holders of Capital Securities shall have no right to exercise
directly any right or remedy available to the holders of, or in respect of, the
Junior Subordinated Debentures.
ARTICLE VI
ACTS OF HOLDERS; MEETINGS; VOTING
SECTION 6.1. LIMITATIONS ON HOLDER'S VOTING RIGHTS.
(a) Except as provided in this Trust Agreement and in the Indenture
and as otherwise required by law, no Holder of Capital Securities shall have any
right to vote or in any manner otherwise control the administration, operation
and management of the Issuer 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 Holders from time
to time as members of an association.
(b) So long as any Junior Subordinated Debentures are held by the
Property Trustee on behalf of the Issuer Trust, the Property Trustee shall not
(i) direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee, or execute any trust or power
conferred on the Property Trustee with respect to such Junior Subordinated
Debentures, (ii) waive any past default that may be waived under Section 5.13 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Junior Subordinated Debentures shall be due and payable
or (iv) consent to any amendment, modification or termination of the Indenture
or the Junior Subordinated Debentures, where such consent shall be required,
without, in each case, obtaining the prior approval of the Holders of at least a
Majority in Liquidation Amount of the Capital Securities, provided, however,
that where a consent under the Indenture would require the consent of each
holder of Junior Subordinated Debentures affected thereby, no such consent shall
be given by the Property Trustee without the prior written consent of each
Holder of Capital Securities. The Property Trustee shall not revoke any action
previously authorized or approved by a vote of the Holders of Capital
Securities, except by a subsequent vote of the Holders of Capital Securities.
The Property Trustee shall notify all Holders of the Capital Securities of any
notice of
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default received with respect to the Junior Subordinated Debentures. In addition
to obtaining the foregoing approvals of the Holders of the Capital Securities,
prior to taking any of the foregoing actions, the Property Trustee shall, at the
expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that such action will not cause the Issuer Trust to be
taxable other than as a grantor trust for United States Federal income tax
purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or
the Issuer Trust otherwise proposes to effect, (i) any action that would
adversely affect in any material respect the interests, powers, preferences or
special rights of the Capital Securities, whether by way of amendment to the
Trust Agreement or otherwise, or (ii) the dissolution, winding-up or termination
of the Issuer Trust, other than pursuant to the terms of this Trust Agreement,
then the Holders of Outstanding Trust 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 Capital Securities. Notwithstanding any other
provision of this Trust Agreement, no amendment to this Trust Agreement may be
made if, as a result of such amendment, it would cause the Issuer Trust to be
taxable other than as a grantor trust for United States Federal income tax
purposes.
SECTION 6.2. NOTICE OF MEETINGS.
Notice of all meetings of the Holders, stating the time, place and
purpose of the meeting, shall be given by the Property Trustee pursuant to
Section 10.8 to each Holder 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 HOLDERS.
No annual meeting of Holders is required to be held. The Property
Trustee, however, shall call a meeting of Holders to vote on any matter upon the
written request of the Holders of record of 25% of the aggregate Liquidation
Amount of the Capital Securities and the Administrators or the Property Trustee
may, at any time in their discretion, call a meeting of Holders of Capital
Securities to vote on any matters as to which Holders are entitled to vote.
Holders of at least a Majority in Liquidation Amount of the Capital
Securities, present in person or represented by proxy, shall constitute a quorum
at any meeting of Holders of the Capital Securities.
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If a quorum is present at a meeting, an affirmative vote by the Holders
of record present, in person or by proxy, holding Capital Securities
representing at least a Majority in Liquidation Amount of the Capital Securities
held by the Holders present, either in person or by proxy, at such meeting shall
constitute the action of the Holders of Capital Securities, unless this Trust
Agreement requires a greater number of affirmative votes.
SECTION 6.4. VOTING RIGHTS.
Holders shall be entitled to one vote for each $1,000 of Liquidation
Amount represented by their Outstanding Trust Securities in respect of any
matter as to which such Holders are entitled to vote.
SECTION 6.5. PROXIES, ETC.
At any meeting of Holders, any Holder 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 Issuer 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 Holders
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 Holder 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. HOLDER ACTION BY WRITTEN CONSENT.
Any action which may be taken by Holders at a meeting may be taken
without a meeting if Holders holding at least a Majority in Liquidation Amount
of all Trust Securities entitled to vote in respect of such action (or such
larger proportion thereof as shall be required by any other provision of this
Trust Agreement) shall consent to the action in writing.
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SECTION 6.7. RECORD DATE FOR VOTING AND OTHER PURPOSES.
For the purposes of determining the Holders who are entitled to notice
of and to vote at any meeting or 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 or Property Trustee may from time to time fix a date,
not more than 90 days prior to the date of any meeting of Holders or the payment
of a distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
SECTION 6.8. ACTS OF HOLDERS.
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 Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders 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 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 Holders 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
8.1) conclusive in favor of the Issuer 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 Issuer Trustee or Administrator receiving the same deems
sufficient.
The ownership of Trust Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Trust Security
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shall bind every future Holder of the same Trust Security and the Holder 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 Issuer Trustees, the Administrators or the Issuer
Trust in reliance thereon, whether or not notation of such action is made upon
such Trust Security.
Without limiting the foregoing, a Holder 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 Holders, the Administrators or the Issuer Trustees
with respect to the authenticity, validity or binding nature of any request,
demand, authorization, direction, consent, waiver or other Act of such Holder or
Issuer Trustee under this Article VI, then the determination of such matter by
the Property Trustee shall be conclusive with respect to such matter.
SECTION 6.9. INSPECTION OF RECORDS.
Upon reasonable notice to the Administrators and the Property Trustee,
the records of the Issuer Trust shall be open to inspection by Holders during
normal business hours for any purpose reasonably related to such Holder's
interest as a Holder.
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 Holders that:
(a) The Property Trustee is a banking corporation with trust powers,
duly organized, validly existing and in good standing under the laws of New
York, with trust power and authority to execute and deliver, and to carry out
and perform its obligations under the terms of this Trust Agreement.
(b) The execution, delivery and performance by the Property Trustee of
this Trust Agreement has been duly authorized by all necessary corporate action
on the part of the Property Trustee; and this Trust Agreement has been duly
executed and
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delivered by the Property Trustee, and constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law).
(c) The execution, delivery and performance of this Trust Agreement by
the Property Trustee does not conflict with or constitute a breach of the
certificate of incorporation or by-laws of the Property Trustee.
(d) At the Closing Time, the Property Trustee has not knowingly
created any Liens on the Trust Securities.
(e) No consent, approval or authorization of, or registration with or
notice to, any New York State or federal banking authority is required for the
execution, delivery or performance by the Property Trustee, of this Trust
Agreement.
(f) The Delaware Trustee is duly organized, validly existing and in
good standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations
under the terms of, this Trust Agreement.
(g) The execution, delivery and performance by the Delaware Trustee of
this Trust Agreement has been duly authorized by all necessary corporate action
on the part of the Delaware Trustee; and this Trust Agreement has been duly
executed and delivered by the Delaware Trustee, and constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' right
generally and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law).
(h) The execution, delivery and performance of this Trust Agreement by
the Delaware Trustee does not conflict with or constitute a breach of the
certificate of incorporation or by-laws of the Delaware Trustee.
(i) No consent, approval or authorization of, or registration with or
notice to any state or Federal banking authority is required for the execution,
delivery or performance by the Delaware Trustee, of this Trust Agreement.
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(j) The Delaware Trustee is an entity which has its principal place of
business in the State of Delaware.
SECTION 7.2. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR.
The Depositor hereby represents and warrants for the benefit of the
Holders that:
(a) the Trust Securities Certificates issued at the Closing Time on
behalf of the Issuer Trust have been duly authorized and will have been duly and
validly executed, and, subject to payment therefor, issued and delivered by the
Issuer Trustees pursuant to the terms and provisions of, and in accordance with
the requirements of, this Trust Agreement, and the Holders 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 Issuer Trust (or the Issuer Trustees on behalf of the Issuer Trust) under
the laws of the State of Delaware or any political subdivision thereof in
connection with the execution, delivery and performance by either the Property
Trustee or the Delaware Trustee, as the case may be, of this Trust Agreement.
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ARTICLE VIII
THE ISSUER TRUSTEES; THE ADMINISTRATORS
SECTION 8.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The duties and responsibilities of the Issuer Trustees and the
Administrators shall be as provided by this Trust Agreement and, in the case of
the Property Trustee, by the Trust Indenture Act. Notwithstanding the foregoing,
no provision of this Trust Agreement shall require the Issuer Trustees or the
Administrators 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 it. 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 Issuer
Trustees or the Administrators shall be subject to the provisions of this
Section. Nothing in this Trust Agreement shall be construed to release an
Administrator or an Issuer Trustee from liability for its own negligent action,
its own negligent failure to act, or its own willful misconduct. To the extent
that, at law or in equity, an Issuer Trustee or Administrator has duties and
liabilities relating to the Issuer Trust or to the Holders, such Issuer Trustee
or Administrator shall not be liable to the Issuer Trust or to any Holder for
such Issuer Trustee's or Administrator'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 Issuer Trustees and
Administrators otherwise existing at law or in equity, are agreed by the
Depositor and the Holders to replace such other duties and liabilities of the
Issuer Trustees and Administrators.
(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 Trust Property to enable the Property Trustee or a
Paying Agent to make payments in accordance with the terms hereof. Each Holder,
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 neither the Issuer Trustees nor
the Administrators are 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 8.1(b) does not limit the liability of the Issuer
Trustees expressly set forth elsewhere in this Trust Agreement or, in the case
of the Property Trustee, in the Trust Indenture Act.
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(c) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Trust Agreement (including pursuant to Section 10.10), and no implied
covenants shall be read into this Trust Agreement against the Property Trustee.
If an Event of Default has occurred (that has not been cured or waived pursuant
to Section 5.13 of the Indenture), the Property Trustee shall enforce this Trust
Agreement for the benefit of the Holders and shall exercise such of the rights
and powers vested in it by this Trust Agreement, and use the same degree of care
and skill in its exercise thereof, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(d) No provision of this Trust 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) 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 Property
Trustee shall be determined solely by the express provisions
of this Trust Agreement (including pursuant to Section 10.10),
and the Property Trustee shall not be liable except for the
performance of such duties and obligations as are specifically
set forth in this Trust Agreement (including pursuant to
Section 10.10); and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Trust Agreement; but in the case of any
such certificates or opinions that by any provision hereof or
of the Trust Indenture Act are specifically required to be
furnished to the Property Trustee, the Property Trustee shall
be under a duty to examine the same to determine whether or
not they conform to the requirements of this Trust Agreement;
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(ii) 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;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of at least a Majority in
Liquidation Amount of the Capital 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;
(iv) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Junior
Subordinated Debentures and the Payment Account shall be to deal with
such property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this
Trust Agreement and the Trust Indenture Act;
(v) 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;
(vi) 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 other
Issuer Trustee, the Administrators or the Depositor; and
(vii) no provision of this Trust Agreement shall require the
Property Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers, if the Property Trustee
shall have reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the terms of
this Trust Agreement or
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adequate indemnity against such risk or liability is not reasonably
assured to it.
(e) The Administrators shall not be responsible for monitoring the
compliance by the Issuer Trustees or the Depositor with their respective duties
under this Trust Agreement, nor shall either Administrator be liable for the
default or misconduct of any other Administrator, the Issuer Trustees or the
Depositor.
SECTION 8.2. CERTAIN NOTICES.
(a) Within five Business Days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Property Trustee, the
Property Trustee shall transmit, in the manner and to the extent provided in
Section 10.8, notice of such Event of Default to the Holders and the
Administrators, unless such Event of Default shall have been cured or waived.
(b) 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 Junior
Subordinated 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 Holders and the Administrators, unless such exercise shall
have been revoked.
SECTION 8.3. CERTAIN RIGHTS OF PROPERTY TRUSTEE.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may conclusively rely and shall be fully
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) any direction or act of the Depositor contemplated by this Trust
Agreement shall be sufficiently evidenced by an Officers' Certificate;
(c) 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
re-recording, refiling or reregistration thereof;
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(d) the Property Trustee may consult with counsel of its own choosing
(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;
(e) 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 Holders pursuant to this Trust Agreement, unless such
Holders shall have offered to the Property Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction; provided that,
nothing contained in this Section 8.3(e) shall be taken to relieve the Property
Trustee, upon the occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this Trust Agreement;
(f) 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 Holders, but the Property
Trustee may make such further inquiry or investigation into such facts or
matters as it may see fit;
(g) the Property Trustee may execute any of the trusts or powers
hereunder or perform any of its 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 any agent or
attorney appointed with due care by it hereunder;
(h) 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 (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 fully protected in
acting in accordance with such instructions; and
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(i) 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.
No provision of this Trust Agreement shall be deemed to impose any duty
or obligation on any Issuer Trustee or Administrator 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 any Issuer Trustee or
Administrator shall be construed to be a duty.
SECTION 8.4. 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 Issuer Trust, and the Issuer Trustees
and the Administrators do not assume any responsibility for their correctness.
The Issuer Trustees and the Administrators shall not be accountable for the use
or application by the Depositor of the proceeds of the Junior Subordinated
Debentures.
SECTION 8.5. MAY HOLD SECURITIES.
Except as provided in the definition of the term "Outstanding" in
Article I, the Administrators, any Issuer Trustee or any other agent of any
Issuer Trustee or the Issuer Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to Sections 8.8 and
8.13, may otherwise deal with the Issuer Trust with the same rights it would
have if it were not an Administrator, Issuer Trustee or such other agent.
SECTION 8.6. COMPENSATION; INDEMNITY; FEES.
The Depositor, as borrower, agrees:
(a) to pay to the Issuer 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) to reimburse the Issuer Trustees upon request for all reasonable
expenses, disbursements and advances incurred or made by the Issuer Trustees in
accordance with any provision of
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this Trust Agreement (including the reasonable compensation, expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to their negligence or willful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) each Issuer Trustee, (ii) each Administrator, (iii) any
Affiliate of any Issuer Trustee, (iv) any officer, director, shareholder,
employee, representative or agent of any Issuer Trustee, and (v) any employee or
agent of the Issuer Trust, (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 by such Indemnified Person arising out of or
in connection with the creation, operation or dissolution of the Issuer Trust or
any act or omission performed or omitted by such Indemnified Person in good
faith on behalf of the Issuer Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Trust Agreement, except that no Indemnified Person
shall be entitled to be indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions.
The provisions of this Section 8.6 shall survive the termination of
this Trust Agreement.
No Issuer Trustee may claim any Lien on any Trust Property as a result
of any amount due pursuant to this Section 8.6.
The Depositor, any Administrator and any Issuer Trustee 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
Issuer Trust, and the Issuer 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 Issuer Trust, shall not be
deemed wrongful or improper. Neither the Depositor, any Administrator, nor any
Issuer Trustee shall be obligated to present any particular investment or other
opportunity to the Issuer Trust even if such opportunity is of a character that,
if presented to the Issuer Trust, could be taken by the Issuer Trust, and the
Depositor, any Administrator or any Issuer 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 Issuer
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
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act on any committee or body of holders of, securities or other obligations of
the Depositor or its Affiliates.
SECTION 8.7. CORPORATE PROPERTY TRUSTEE REQUIRED; ELIGIBILITY OF
TRUSTEES AND ADMINISTRATORS.
(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
a national or state chartered bank and 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 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 VIII. At the time of appointment, the Property Trustee must have
securities rated in one of the three highest rating categories by a nationally
recognized statistical rating organization.
(b) There shall at all times be one or more Administrators hereunder.
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. An employee, officer or Affiliate of the Depositor may serve
as an Administrator.
(c) There shall at all times be a Delaware Trustee. 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 8.8. CONFLICTING INTERESTS.
(a) 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.
(b) The Guarantee and the Indenture shall be deemed to be sufficiently
described in this Trust Agreement for the purposes of clause (i) of the first
proviso contained in
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Section 310(b) of the Trust Indenture Act.
SECTION 8.9. CO-TRUSTEES AND SEPARATE TRUSTEE.
Unless an Event of Default shall have occurred and be continuing, at
any time or times, for the purpose of meeting the legal requirements of the
Trust Indenture Act or of any jurisdiction in which any part of the Trust
Property may at the time be located, the Property Trustee shall have power to
appoint, and upon the written request of the Property Trustee, the Depositor and
the Administrators shall for such purpose join with the Property Trustee 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. 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.
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 executed by one or more
Administrators, and the Trust Securities shall be authenticated and 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 Property Trustee specified hereunder, shall be
exercised, solely by the Property Trustee 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 and
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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 8.9.
(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 Issuer 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.
Subject to the immediately preceding paragraph, a Relevant Trustee may
resign at any time by giving written notice thereof to the Holders. The Relevant
Trustee shall appoint a successor by requesting from at least three Persons
meeting the eligibility requirements its expenses and charges to serve as the
successor trustee on a form provided by the Administrators, and selecting the
Person who agrees to the lowest expenses and charges, subject to the prior
consent of the Depositor which consent shall
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not be unreasonably withheld. 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 Issuer Trust, any court of
the State of Delaware for the appointment of a successor Relevant Trustee.
The Property Trustee or the Delaware Trustee may be removed at any time
by Act of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, delivered to the Relevant Trustee (in its individual
capacity and on behalf of the Issuer Trust) (i) for cause (including upon the
occurrence of an Event of Default described in subparagraph (e) of the
definition thereof with respect to the Relevant Trustee), or (ii) if a Debenture
Event of Default shall have occurred and be continuing at any time.
If any Issuer Trustee shall resign, it shall appoint its successor. If
a resigning Relevant Trustee shall fail to appoint a successor, or if a Relevant
Trustee shall be removed or become incapable of acting as Issuer Trustee, or if
any vacancy shall occur in the office of any Issuer Trustee for any cause, the
Holders of the Capital Securities, by Act of the Holders of record of not less
than 25% in aggregate Liquidation Amount of the Capital Securities then
Outstanding delivered to such Relevant Trustee, shall promptly appoint a
successor Relevant Trustee or Trustees, and such successor Issuer Trustee shall
comply with the applicable requirements of Section 8.11. If no successor trustee
shall have been so appointed by the Holders of the Capital Securities and
accepted appointment in the manner required by Section 8.11, any Holder, on
behalf of himself and all others similarly situated, or any other Issuer
Trustee, may petition any court in the State of Delaware for the appointment of
a successor trustee.
The Property Trustee shall give notice of each resignation and each
removal of a Relevant Trustee and each appointment of a successor trustee to all
Holders in the manner provided in Section 10.8 and shall give notice to the
Depositor and to the Administrators. Each notice shall include the name of the
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 Delaware Trustee who is a natural person dies or
becomes, in the opinion of the Holders of the Common Securities, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by the Property Trustee following the procedures regarding expenses
and charges set forth above (with the successor in each case being a Person who
satisfies the eligibility requirement for the Delaware Trustee, as the case may
be, set forth in Section 8.7).
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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 such successor Relevant Trustee with
respect to the Trust Securities shall execute, acknowledge and deliver an
amendment hereto wherein each successor Relevant Trustee shall accept such
appointment and which (a) 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 Issuer Trust, and (b) shall
add to or change any of the provisions of this Trust Agreement as shall be
necessary to provide for or facilitate the administration of the Issuer Trust by
more than one Relevant Trustee, it being understood that nothing herein or in
such amendment shall constitute such Relevant Trustee a co-trustee and 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 Issuer Trust or any
successor Relevant Trustee such retiring Relevant Trustee shall 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 Issuer Trust.
Upon request of any such successor Relevant Trustee, the Issuer 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 first or second preceding paragraph, as the case may
be.
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 VIII.
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 that such Person shall be otherwise
qualified and eligible under this Article VIII, without
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the execution or filing of any paper or any further act on the part of any of
the parties hereto.
SECTION 8.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST DEPOSITOR OR
ISSUER TRUST.
If and when the Property Trustee shall be or become a creditor of the
Depositor (or any other obligor upon the Trust Securities), the Property Trustee
shall be subject to the provisions of the Trust Indenture Act regarding the
collection of claims against the Depositor (or any such other obligor) only if
this Trust Agreement is subject to the Trust Indenture Act.
SECTION 8.14. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Issuer Trust or any other obligor upon the Trust
Securities or the property of the Issuer Trust or of such other obligor, the
Property Trustee (irrespective of whether any Distributions on the Trust
Securities shall then be due and payable and irrespective of whether the
Property Trustee shall have made any demand on the Issuer Trust for the payment
of any past due Distributions) shall be entitled and empowered, to the fullest
extent permitted by law, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the 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 monies or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Property Trustee and, in the event the Property Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Property Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Property Trustee, its agents and counsel, and
any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement,
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adjustment or compensation 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 8.15. REPORTS BY PROPERTY TRUSTEE.
(a) Not later than January 31 of each year commencing with January 31,
1999, the Property Trustee shall transmit to all Holders in accordance with
Section 10.8, and to the Depositor, a brief report dated as of the immediately
preceding December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if to the
best of its knowledge it has continued to be eligible under said
Section, a written statement to such effect; and
(ii) any change in the property and funds in its possession as Property
Trustee since the date of its last report and any action taken by the
Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects
the Trust Securities.
(b) In addition the Property Trustee shall transmit to Holders such
reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to 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 the Depositor.
SECTION 8.16. REPORTS TO THE PROPERTY TRUSTEE.
The Depositor and the Administrators on behalf of the Issuer 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) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act. The Depositor and the Administrators shall annually file with the Property
Trustee a certificate specifying whether such Person is in compliance with all
the terms and covenants applicable to such Person hereunder.
SECTION 8.17. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.
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Each of the Depositor and the Administrators on behalf of the Issuer
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 8.18. NUMBER OF ISSUER TRUSTEES.
(a) The number of Issuer Trustees shall be two. The Property Trustee
and the Delaware Trustee may be the same Person, in which case, the number of
Issuer Trustees may be one.
(b) If an Issuer Trustee ceases to hold office for any reason, a
vacancy shall occur. The vacancy shall be filled with an Issuer Trustee
appointed in accordance with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of an Issuer Trustee shall not
operate to dissolve, terminate or annul the Issuer Trust or terminate this Trust
Agreement.
SECTION 8.19. 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 making any governmental filing; and
(b) The Administrators shall have power to delegate from time to time
to such of their number the doing of such things and the execution of such
instruments either in the name of the Issuer Trust or the names of the
Administrators or otherwise as the Administrators may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of this Trust Agreement.
SECTION 8.20. APPOINTMENT OF ADMINISTRATORS.
(a) The Administrators shall be appointed by the Holders of a Majority
in Liquidation Amount of the Common Securities and may be removed by the Holders
of a Majority in Liquidation Amount of the Common Securities or may resign at
any time. Upon any resignation or removal, the Depositor shall appoint a
successor Administrator. Each Administrator shall execute this Trust Agreement
thereby agreeing to comply with, and be legally bound by, all of the terms,
conditions and provisions of this Trust Agreement. If at any time there is no
Administrator, the Property
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Trustee or any Holder who has been a Holder of Trust Securities for at least six
months may petition any court of competent jurisdiction for the appointment of
one or more Administrators.
(b) Whenever a vacancy in the number of Administrators shall occur,
until such vacancy is filled by the appointment of an Administrator in
accordance with this Section 8.20, the Administrators in office, regardless of
their number (and notwithstanding any other provision of this Agreement), shall
have all the powers granted to the Administrators and shall discharge all the
duties imposed upon the Administrators by this Trust Agreement.
(c) Notwithstanding the foregoing, or any other provision of this Trust
Agreement, in the event any Administrator who is a natural person dies or
becomes, in the opinion of the Holders of a Majority in Liquidation Amount of
the Common Securities, incompetent, or incapacitated, the vacancy created by
such death, incompetence or incapacity may be filled by the remaining
Administrators, if there were at least two of them prior to such vacancy, and by
the Depositor, if there were not two such Administrators immediately prior to
such vacancy (with the successor in each case being a Person who satisfies the
eligibility requirement for Administrators, as the case may be, set forth in
Section 8.7).
Except as otherwise provided in this Trust Agreement, or by applicable
law, any one Administrator may execute any document or otherwise take any action
which the Administrators are authorized to take under this Trust Agreement.
ARTICLE IX
DISSOLUTION, LIQUIDATION AND MERGER
SECTION 9.1. DISSOLUTION UPON EXPIRATION DATE.
Unless earlier dissolved, the Issuer Trust shall automatically dissolve
on March 1 , 2029 (the "Expiration Date"), and 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," upon the occurrence of which the Issuer Trust shall
dissolve:
(a) the occurrence of the appointment of a receiver or other similar
official in any liquidation, insolvency or similar proceeding with respect to
the Depositor or all or substantially
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all of its property, or a court or other governmental agency shall enter a
decree or order and such decree or order shall remain unstayed and undischarged
for a period of 60 days, unless the Depositor shall transfer the Common
Securities as provided by Section 5.11, in which case this provision shall refer
instead to any such successor Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Holder of
the Common Securities at any time to dissolve the Issuer Trust and to distribute
the Junior Subordinated Debentures to Holders in exchange for the Capital
Securities (which direction, subject to Section 9.4(a), is optional and wholly
within the discretion of the Holder of the Common Securities);
(c) the repayment of all of the Capital Securities in connection with
the redemption of all the Junior Subordinated Debentures; and
(d) the entry of an order for dissolution of the Issuer Trust by a
court of competent jurisdiction.
SECTION 9.3. TERMINATION.
As soon as is practicable after the occurrence of an event referred to
in Section 9.1 or 9.2, and upon the completion of the winding-up and liquidation
of the Issuer Trust, the Administrators and the Issuer Trustees (each of whom is
hereby authorized to take such action) shall file a certificate of cancellation
with the Secretary of State of the State of Delaware terminating the Issuer
Trust and, upon such filing, the respective obligations and responsibilities of
the Issuer Trustees, the Administrators and the Issuer Trust created and
continued hereby shall terminate.
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 Issuer Trust shall be
wound-up and liquidated by the Property Trustee as expeditiously as the Property
Trustee determines to be possible by distributing, after paying or making
reasonable provision to pay all claims and obligations of the Issuer Trust in
accordance with Section 3808(e) of the Delaware Business Trust Act, to each
Holder a Like Amount of Junior Subordinated 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 45
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:
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(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 Junior Subordinated Debentures; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Trust Securities Certificates for Junior
Subordinated Debentures, or if Section 9.4(d) 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 Issuer Trust and distribution of the Junior Subordinated
Debentures to Holders, the Property Trustee shall establish a record date for
such distribution (which shall be not more than 30 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 Junior Subordinated 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) the Clearing Agency for the Capital Securities or its nominee,
as the registered holder of the Global Capital Securities Certificate, shall
receive a registered global certificate or certificates representing the Junior
Subordinated Debentures to be delivered upon such distribution with respect to
Capital Securities held by the Clearing Agency or its nominee, and, (iii) any
Trust Securities Certificates not held by the Clearing Agency for the Capital
Securities or its nominee as specified in clause (ii) above will be deemed to
represent Junior Subordinated Debentures having a principal amount equal to the
stated Liquidation Amount of the Trust Securities represented thereby and
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Trust Securities until such certificates are
presented to the Securities Registrar for transfer or reissuance.
(d) If, 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 Junior Subordinated Debentures is
not practical, or if any Early Termination Event specified in clause (c) of
Section 9.2 occurs, the Issuer Trust shall be dissolved, and the Trust Property
shall be liquidated, by the Property Trustee in such manner as the
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Property Trustee determines. In such event, on the date of the dissolution of
the Issuer Trust, Holders will be entitled to receive out of the assets of the
Issuer Trust available for distribution to Holders, after paying or making
reasonable provision to pay all claims and obligations of the Issuer Trust in
accordance with Section 3808(e) of the Delaware Business Trust Act, an amount
equal to the aggregate of 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 dissolution, the Liquidation
Distribution can be paid only in part because the Issuer 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 Issuer Trust
on the Trust Securities shall be paid on a pro rata basis (based upon
Liquidation Amounts). The Holders of the Common Securities will be entitled to
receive Liquidation Distributions upon any such dissolution, pro rata
(determined as aforesaid) with Holders of Capital Securities, except that, if a
Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a priority over the Common Securities as provided in
Section 4.3.
SECTION 9.5. MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF
THE ISSUER TRUST.
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The Issuer Trust may not merge with or into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any entity, except pursuant to this Section 9.5
or Section 9.4. At the request of the Holders of the Common Securities, and with
the consent of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, but without the consent of the Issuer Trustees, the Issuer
Trust may merge with or into, consolidate, 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, however,
that (i) such successor entity either (a) expressly assumes all of the
obligations of the Issuer Trust with respect to the Capital Securities or (b)
substitutes for the Capital Securities other securities having substantially the
same terms as the Capital Securities (the "Successor Capital Securities") so
long as the Successor Capital Securities have the same priority as the Capital
Securities with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) a trustee of such successor entity possessing the
same powers and duties as the Property Trustee is appointed to hold the Junior
Subordinated Debentures, (iii) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the Capital Securities
(including any Successor Capital Securities) to be downgraded by any nationally
recognized statistical rating organization, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the holders of the Capital
Securities (including any Successor Capital Securities) in any material respect,
(v) such successor entity has a purpose substantially identical to that of the
Issuer Trust, (vi) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Issuer Trustee has received an
Opinion of Counsel from independent counsel experienced in such matters to the
effect that (a) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights preferences
and privileges of the holders of the Capital Securities (including any Successor
Capital Securities) in any material respect, and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, neither
the Issuer Trust nor such successor entity will be required to register as an
"investment company" under the Investment Company Act and (vii) the Depositor or
any permitted transferee to whom it has transferred the Common Securities
hereunder owns all of the common securities of such successor entity and
guarantees the obligations of such successor entity under the Successor Capital
Securities at least to the extent provided by the Guarantee. Notwithstanding the
foregoing, the Issuer Trust shall not, except with the consent of holders of
100% in Liquidation Amount of the Capital Securities, consolidate, amalgamate,
merge with or into, or be replaced by or convey, transfer or lease its
properties and
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assets substantially as an entirety to, any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Issuer Trust or the successor entity to be taxable other than as
a grantor trust for United States Federal income tax purposes.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. LIMITATION OF RIGHTS OF HOLDERS.
Except as set forth in Section 9.2, the bankruptcy, dissolution,
termination, death or incapacity of any Person having an interest, beneficial or
otherwise, in Trust Securities shall not operate to terminate this Trust
Agreement, nor entitle the legal representatives or heirs of such person or any
Holder 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. Any merger or similar
agreement shall be executed by the Administrators on behalf of the Issuer Trust.
SECTION 10.2. AMENDMENT.
(a) This Trust Agreement may be amended from time to time by the
Property Trustee and the Holders of a Majority in Liquidation Amount of the
Common Securities, without the consent of any Holder of the Capital 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,
provided, however, that such amendment shall not adversely affect in any
material respect the interests of any Holder or (ii) to modify, eliminate or add
to any provisions of this Trust Agreement to such extent as shall be necessary
to ensure that the Issuer Trust will not be taxable other than as a grantor
trust for United States Federal income tax purposes at any time that any Trust
Securities are Outstanding or to ensure that the Issuer Trust will not be
required to register as an investment company under the Investment Company Act.
(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Property Trustee and the Holders of a
Majority in Liquidation Amount of the Common Securities with (i) the consent of
Holders of at least a Majority in Liquidation Amount of the Capital Securities
and (ii) receipt by the Issuer Trustees of an Opinion of Counsel to the effect
that such amendment or the exercise of any power granted to
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the Issuer Trustees in accordance with such amendment will not affect the Issuer
Trust's being taxable as a grantor trust for United States Federal income tax
purposes or the Issuer Trust's exemption from status of an "investment company"
under the Investment Company Act.
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Holder (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 Securities as of a specified date or
(ii) restrict the right of a Holder to institute suit for the enforcement of any
such payment on or after such date.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Issuer Trustee shall enter into or consent to any amendment to this Trust
Agreement which would cause the Issuer Trust to fail or cease to qualify for the
exemption from status as an "investment company" under the Investment Company
Act or be taxable other than 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 and the Administrators, this Trust
Agreement may not be amended in a manner which imposes any additional obligation
on the Depositor or the Administrators.
(f) In the event that any amendment to this Trust Agreement is made,
the Administrators or the Property Trustee 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.
(h) Any amendments to this Trust Agreement shall become effective when
notice of such amendment is given to the Holders of the Trust Securities.
SECTION 10.3. SEPARABILITY.
In case any provision in this Trust Agreement or in the Trust
Securities Certificates shall be invalid, illegal or
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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
HOLDERS, THE ISSUER TRUST, THE DEPOSITOR, THE ISSUER TRUSTEES AND THE
ADMINISTRATORS SHALL GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF DELAWARE AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS OF THE STATE OF DELAWARE OR
ANY OTHER JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE LAW OF ANY
JURISDICTION OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER, THAT THERE
SHALL NOT BE APPLICABLE TO THE HOLDERS, THE ISSUER TRUST, THE DEPOSITOR, THE
ISSUER TRUSTEES, THE ADMINISTRATORS OR THIS TRUST AGREEMENT ANY PROVISION OF THE
LAWS (STATUTORY OR COMMON) OF THE STATE OF DELAWARE PERTAINING TO TRUSTS OTHER
THAN THE DELAWARE BUSINESS TRUST ACT THAT RELATE TO OR REGULATE, IN A MANNER
INCONSISTENT WITH THE TERMS HEREOF (A) THE FILING WITH ANY COURT OR GOVERNMENTAL
BODY OR AGENCY OF TRUSTEE ACCOUNTS OR SCHEDULES OF TRUSTEE FEES AND CHARGES, (B)
AFFIRMATIVE REQUIREMENTS TO POST BONDS FOR TRUSTEES, OFFICERS, AGENTS OR
EMPLOYEES OF A TRUST, (C) THE NECESSITY FOR OBTAINING COURT OR OTHER
GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION, HOLDING OR DISPOSITION OF REAL
OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS PAYABLE TO TRUSTEES, OFFICERS,
AGENTS OR EMPLOYEES OF A TRUST, (E) THE ALLOCATION OF RECEIPTS AND EXPENDITURES
TO INCOME OR PRINCIPAL, (F) RESTRICTIONS OR LIMITATIONS ON THE PERMISSIBLE
NATURE, AMOUNT OR CONCENTRATION OF TRUST INVESTMENTS OR REQUIREMENTS RELATING TO
THE TITLING, STORAGE OR OTHER MANNER OF HOLDING OR INVESTING TRUST ASSETS OR (G)
THE ESTABLISHMENT OF FIDUCIARY OR OTHER STANDARDS OF RESPONSIBILITY OR
LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES THAT ARE INCONSISTENT WITH THE
LIMITATIONS OR LIABILITIES OR AUTHORITIES AND POWERS OF THE ISSUER TRUSTEES OR
THE ADMINISTRATOR AS SET FORTH OR REFERENCED IN THIS TRUST AGREEMENT. SECTION
3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE ISSUER TRUST.
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 4.2(d)), with the same force and effect as though
made on the date fixed for such payment, and no Distributions shall accumulate
on such unpaid amount for the period after such date.
SECTION 10.6. SUCCESSORS.
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This Trust Agreement shall be binding upon and shall inure to the
benefit of any successor to the Depositor, the Issuer Trust, the Administrators
and any Issuer Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article VIII 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 that by any provision
of this Trust Agreement is required or permitted to be given or served to or
upon any Holder 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 Holder
of Capital Securities, to such Holder as such Holder's name and address may
appear on the Securities Register; and (b) in the case of the Holder of Common
Securities or the Depositor, to First Citizens BancShares, Inc., 3128 Smoketree
Court, Raleigh, North Carolina 27604, Attention: Kenneth A. Black, facsimile
no.: (919) 716-2844 or to such other address as may be specified in a written
notice by the Depositor to the Property Trustee. Such notice, demand or other
communication to or upon a Holder shall be deemed to have been sufficiently
given or made, for all purposes, upon hand delivery, mailing or transmission.
Such notice, demand or other communication to or upon the Depositor shall be
deemed to have been sufficiently given or made only upon actual receipt of the
writing by the Depositor.
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 Issuer Trust, the Property Trustee, the Delaware Trustee, the
Administrators, or the Issuer Trust shall be given in writing addressed (until
another address is published by the Issuer Trust) as follows: (a) with respect
to the Property Trustee to Bankers Trust Company, Four Albany Street, 4th Floor,
New York, NY 10006, Attention: Corporate Trust and Agency Group-Corporate Market
Services; (b) with respect to the Delaware Trustee to Bankers Trust (Delaware),
E.A. Delle Donne Corporate Center, Montgomery Building , 1011 Centre Road, Suite
200, Wilmington, Delaware 19805-1266, Attention: Lisa Wilkins; and (c) with
respect to the Administrators, to them at the address above for notices to the
Depositor, marked "Attention: Office of the
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<PAGE>
Secretary". Such notice, demand or other communication to or upon the Issuer
Trust or the Property Trustee shall be deemed to have been sufficiently given or
made only upon actual receipt of the writing by the Issuer Trust, the Property
Trustee, or such Administrator.
SECTION 10.9. AGREEMENT NOT TO PETITION.
Each of the Issuer Trustees, the Administrators and the Depositor agree
for the benefit of the Holders that, until at least one year and one day after
the Issuer Trust has been terminated in accordance with Article IX, they shall
not file, or join in the filing of, a petition against the Issuer 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 Issuer 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 Holders, 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 Issuer 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 estopped and precluded therefrom and such
other defenses, if any, as counsel for the Issuer Trustee or the Issuer Trust
may assert. If any Issuer Trustee or Administrator takes action in violation of
this Section 10.9, the Depositor agrees, for the benefit of the Holders, 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 such Person against
the Depositor or the commencement of such action and raise the defense that such
Person has agreed in writing not to take such action and should be estopped and
precluded therefrom and such other defenses, if any, as counsel for the Issuer
Trustee or the Issuer 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) TRUST INDENTURE ACT; APPLICATION. (i) This Trust Agreement is
subject to the provisions of the Trust Indenture Act that are required to be a
part of this Trust Agreement and shall, to the extent applicable, be governed by
such provisions; (ii) if and to the extent that any provision of this Trust
Agreement limits, qualifies or conflicts with the duties imposed by Sections 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control; (iii) for purposes of this Trust Agreement, the Property Trustee, to
the extent permitted by
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<PAGE>
applicable law and/or the rules and regulations of the Commission, shall be the
only Issuer Trustee which is a trustee for the purposes of the Trust Indenture
Act; and (iv) the application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Capital Securities and the Common Securities
as equity securities representing undivided beneficial interests in the assets
of the Issuer Trust.
(b) LISTS OF HOLDERS OF PREFERRED SECURITIES. (i) Each of the Depositor
and the Administrators on behalf of the Trust shall provide the Property Trustee
with such information as is required under Section 312(a) of the Trust Indenture
Act at the times and in the manner provided in Section 312(a) and (ii) the
Property Trustee shall comply with its obligations under Sections 310(b), 311
and 312(b) of the Trust Indenture Act.
(c) REPORTS BY THE PROPERTY TRUSTEE. Within 60 days after May 15 of
each year, the Property Trustee shall provide to the Holders of the Trust
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form, in the manner and at the times provided by Section 313
of the Trust Indenture Act. The Property Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
(d) PERIODIC REPORTS TO PROPERTY TRUSTEE. Each of the Depositor and
the Administrators on behalf of the Issuer Trust shall provide to the Property
Trustee, the Commission and the Holders of the Trust Securities, as applicable,
such documents, reports and information as required by Section 315(a)(1) - (3)
(if any) of the Trust Indenture Act and the compliance certificates required by
Section 314(a)(4) and (c) of the Trust Indenture Act (provided that any
certificate to be provided pursuant to Section 314(a)(4) of the Trust Indenture
Act shall be provided within 120 days of the end of each fiscal year of the
Issuer Trust).
(e) EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. Each of the
Depositor and the Administrators on behalf of the Issuer Trust shall provide to
the Property Trustee such evidence of compliance with any conditions precedent,
if any, provided for in this Trust Agreement which 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 pursuant to Section 314(c) shall comply with
Section 314(e) of the Trust Indenture Act.
(f) DISCLOSURE INFORMATION. The disclosure of information as to the
names and addresses of the Holders of Trust Securities in accordance with
Section 312 of the Trust Indenture Act, regardless of the source from which such
information was derived, shall not be deemed to be a violation of any existing
law or any law hereafter enacted which does not specifically refer to
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<PAGE>
Section 312 of the Trust Indenture Act, nor shall the Property Trustee be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.
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 HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY
OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT, THE GUARANTEE AND THE
INDENTURE, AND THE AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF
THE GUARANTEE AND THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE
ISSUER TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS
TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE ISSUER
TRUST AND SUCH HOLDER AND SUCH OTHERS.
ARTICLE XI
REGISTRATION RIGHTS
Section 11.1. REGISTRATION RIGHTS. The Holders of the Capital
Securities, the holders of the Junior Subordinated Debentures and the Guarantee,
are entitled to the benefits of the Registration Rights Agreement.
* * * *
This instrument 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.
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed, all as of the day and year first above written.
FIRST CITIZENS BANCSHARES, INC.
as Depositor
By: /s/ Kenneth A. Black
Name: Kenneth A. Black
Title: Vice President and Chief
Financial Officer
BANKERS TRUST COMPANY,
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<PAGE>
as Property Trustee, and not in its
individual capacity
By: /s/ Sandra J. Shaffer
Name: Sandra J. Shaffer
Title: Assistant Vice President
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<PAGE>
BANKERS TRUST (DELAWARE),
as Delaware Trustee, and not
in its individual capacity
By: /s/ M. Lisa Wilkins
Name: M. Lisa Wilkins
Title: Assistant Secretary
Agreed to and Accepted by,
/s/ Kenneth A. Black
Name: Kenneth A. Black
Title: Administrator
/s/ John H. Gray
Name: John H. Gray
Title: Administrator
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<PAGE>
EXHIBIT A
CERTIFICATE OF TRUST OF
FCB/NC CAPITAL TRUST I
THIS CERTIFICATE OF TRUST of FCB/NC Capital Trust I (the "Trust"),
dated February 27, 1998, is being duly executed and filed by Bankers Trust
(Delaware), a Delaware banking corporation, as trustee, to form a business trust
under the Delaware Business Trust Act (12 Del. C. ss. 3801 et seq.).
1. Name. The name of the business trust formed hereby is "FCB/NC
Capital Trust I".
2. Delaware Trustee. The name and address of the trustee of the Trust
with a principal place of business in the State of Delaware is:
Bankers Trust (Delaware)
E.A. Delle Donne Corporate Center
Montgomery Building
1011 Centre Road, Suite 200
Wilmington, Delaware 19805-1266
3. Effective Date. This Certificate of Trust shall be effective upon
its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the
Trust, has executed this Certificate of Trust as of the date first written
above.
BANKERS TRUST (DELAWARE),
not in its individual capacity, but
solely as trustee
By: /s/ M. Lisa Wilkins
------------------------------
Name: M. Lisa Wilkins
Title: Assistant Secretary
<PAGE>
EXHIBIT B
[INSERT FORM OF CERTIFICATE DEPOSITARY AGREEMENT]
[INTENTIONALLY OMITTED]
<PAGE>
EXHIBIT C
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE
DEPOSITOR OR AN AFFILIATE OF THE DEPOSITOR
IN COMPLIANCE WITH APPLICABLE LAW AND
SECTION 5.11 OF THE TRUST AGREEMENT
CERTIFICATE NUMBER NUMBER OF COMMON SECURITIES
C-1 ____________
($ AGGREGATE LIQUIDATION AMOUNT)
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
FCB/NC CAPITAL TRUST I
8.05% COMMON SECURITIES
(LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY)
FCB/NC Capital Trust I, a statutory business trust created under the
laws of the State of Delaware (the "Issuer Trust"), hereby certifies that First
Citizens BancShares, Inc. (the "Holder") is the registered owner of ( )
common securities of the Issuer Trust representing undivided beneficial
interests in the assets of the Issuer Trust and has designated the FCB/NC
Capital Trust I 8.05% Common Securities (liquidation amount $1,000 per Common
Security) (the "Common Securities"). Except in accordance with Section 5.11 of
the Trust Agreement (as defined below) the Common Securities are not
transferable and any attempted transfer hereof other than in accordance
therewith 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 Issuer Trust, dated as of March 5,
1998, as the same may be amended from time to time (the "Trust Agreement") among
First Citizens BancShares, Inc., as Depositor, Bankers Trust Company, as
Property Trustee, Bankers Trust (Delaware), as Delaware Trustee, the
Administrators named therein and the Holders of Trust Securities, including the
designation of the terms of the Common Securities as set forth therein. The
Issuer Trust will furnish a copy of the Trust Agreement to the Holder without
charge upon written request to the Issuer Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
Terms used but not defined herein have the meanings set forth in the
Trust Agreement.
<PAGE>
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this 5th day of March, 1998.
FCB/NC CAPITAL TRUST I
By:________________________________
Kenneth A. Black
Administrator
AUTHENTICATED:
BANKERS TRUST COMPANY,
as Property Trustee
By: ________________________
Authorized Signatory
<PAGE>
EXHIBIT D
[IF THE CAPITAL SECURITIES CERTIFICATE IS TO BE A GLOBAL CAPITAL SECURITIES
CERTIFICATE, INSERT:] This Capital Securities Certificate is a Global Capital
Securities Certificate within the meaning of the Trust Agreement hereinafter
referred to and is registered in the name of a Depositary or a nominee of a
Depositary. This Capital Securities Certificate is exchangeable for Capital
Securities Certificates registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Trust Agreement and may not be transferred except as a whole by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary, except in the limited
circumstances described in the Trust Agreement.
Unless this Capital Securities Certificate is presented by an
authorized representative of The Depository Trust Company, a New York
Corporation ("DTC"), to FCB/NC Capital Trust I or its agent for registration of
transfer, exchange or payment, and any Capital Securities Certificate issued is
registered in the name of Cede & Co. or such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
THE CAPITAL SECURITIES EVIDENCED HEREBY AND ANY JUNIOR SUBORDINATED
DEBENTURES ISSUABLE IN CONNECTION THEREWITH HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) BY ANY INITIAL
INVESTOR THAT IS NOT A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A UNDER THE SECURITIES ACT, (I) TO A PERSON WHOM THE TRANSFEROR REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II)
IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, OR (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) AND (B)
BY AN INITIAL INVESTOR THAT IS A QUALIFIED INSTITUTIONAL BUYER OR ANY SUBSEQUENT
INVESTOR AS SET FORTH IN (A) ABOVE AND, IN ADDITION, TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT, AND, IN EACH CASE IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF THE STATES AND OTHER JURISDICTIONS OF THE UNITED STATES. THE
HOLDER OF THIS CAPITAL SECURITY AGREES THAT IT WILL COMPLY WITH THE FOREGOING
RESTRICTIONS. SECURITIES OWNED BY AN INITIAL INVESTOR THAT IS NOT A QUALIFIED
INSTITUTIONAL BUYER MAY NOT BE HELD IN BOOK-ENTRY FORM AND MAY NOT BE
TRANSFERRED WITHOUT CERTIFICATION THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS, AS PROVIDED IN THE TRUST AGREEMENT REFERRED TO BELOW. NO
<PAGE>
REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED
BY RULE 144 FOR RESALES OF THE CAPITAL SECURITIES OR ANY JUNIOR SUBORDINATED
DEBENTURES DISTRIBUTABLE TO HOLDERS OF THE CAPITAL SECURITIES.
THE CAPITAL SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN
BLOCKS HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 (100 CAPITAL
SECURITIES). ANY SUCH TRANSFER OF CAPITAL SECURITIES IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000 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 CAPITAL SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO
THE RECEIPT OF DISTRIBUTIONS OF SUCH CAPITAL SECURITIES, AND SUCH TRANSFEREE
SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH CAPITAL SECURITIES.
NO EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT ACCOUNT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE") (EACH, A "PLAN"), NO ENTITY WHOSE UNDERLYING ASSETS INCLUDE
"PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET
ENTITY"), AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN, MAY ACQUIRE OR HOLD
THIS CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASE
OR HOLDING IS COVERED BY THE EXEMPTIVE RELIEF PROVIDED BY U.S. DEPARTMENT OF
LABOR PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 96-23, 95-60, 91-38, 90-1
OR 84-14 OR ANOTHER APPLICABLE EXEMPTION WITH RESPECT TO SUCH PURCHASE OR
HOLDING. ANY PURCHASER OR HOLDER OF THIS CAPITAL SECURITIES CERTIFICATE OR ANY
INTEREST HEREIN THAT IS A PLAN OR A PLAN ASSET ENTITY OR IS PURCHASING SUCH
SECURITIES ON BEHALF OF OR WITH "PLAN ASSETS" WILL BE DEEMED TO HAVE REPRESENTED
BY ITS PURCHASE AND HOLDING HEREOF THAT (A) THE PURCHASE AND HOLDING OF THE
CAPITAL SECURITIES IS COVERED BY THE EXEMPTIVE RELIEF PROVIDED BY PTCE 96-23,
95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION, (B) THE COMPANY AND
THE ADMINISTRATORS ARE NOT "FIDUCIARIES" WITHIN THE MEANING OF SECTION 3(21) OF
ERISA AND THE REGULATIONS THEREUNDER, WITH RESPECT TO SUCH PERSON'S INTEREST IN
THE CAPITAL SECURITIES OR THE JUNIOR SUBORDINATED DEBENTURES, AND (C) IN
PURCHASING THE CAPITAL SECURITIES SUCH PERSON APPROVES THE PURCHASE OF THE
JUNIOR SUBORDINATED DEBENTURES AND THE APPOINTMENT OF THE ISSUER TRUSTEES.
<PAGE>
CERTIFICATE NUMBER AGGREGATE LIQUIDATION AMOUNT
D- $_______________
(_________ CAPITAL SECURITIES)
CUSIP NO.
CERTIFICATE EVIDENCING CAPITAL SECURITIES
OF
FCB/NC CAPITAL TRUST I
8.05% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FCB/NC Capital Trust I, a statutory business trust created under the
laws of the State of Delaware (the "Issuer Trust"), hereby certifies that
______________________ (the "Holder") is the registered owner of
_______________________ Dollars ($____________) aggregate liquidation amount of
capital securities of the Issuer Trust representing a preferred undivided
beneficial interest in the assets of the Issuer Trust and has designated the
FCB/NC Capital Trust I 8.05% Capital Securities (liquidation amount $1,000 per
Capital Security) (the "Capital Securities"). The Capital Securities are
transferable on the books and records of the Issuer 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 5.5 of the Trust Agreement
(as defined below). The designations, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities are set
forth in, and this certificate and the Capital 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 Issuer Trust, dated as of March 5,
1998, as the same may be amended from time to time (the "Trust Agreement"),
among First Citizens BancShares, Inc., as Depositor, Bankers Trust Company, as
Property Trustee, Bankers Trust (Delaware), as Delaware Trustee, the
Administrators named herein and the Holders of Trust Securities, including the
designation of the terms of the Capital Securities as set forth therein. The
Holder is entitled to the benefits of the Guarantee Agreement entered into by
First Citizens BancShares, Inc., as Guarantor, and Bankers Trust Company, as
Guarantee Trustee, dated as of March 5, 1998 (the "Guarantee Agreement"), to the
extent provided therein. The Issuer Trust will furnish a copy of the Trust
Agreement and the Guarantee Agreement to the Holder without charge upon written
request to the Issuer Trust by contacting the Issuer Trustees.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
<PAGE>
Terms used but not defined herein have the meanings set forth in the
Trust Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this 5th day of March, 1998.
FCB/NC CAPITAL TRUST I
By:_________________________________
Name: Kenneth A. Black
Administrator
AUTHENTICATED:
BANKERS TRUST COMPANY,
as Property Trustee
By: ________________________
Authorized Signatory
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security
to:
- -----------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints _____________________________________________________
- ------------------------------------------------------------------------------
agent to transfer this Capital Securities Certificate on the books of the Issuer
Trust. The agent may substitute another to act for him or her.
Date:________________________
Signature:__________________________________________________
(Sign exactly as your name appears on the other side of
this Capital Securities Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
<PAGE>
EXHIBIT E
[Form of Restricted Securities Certificate]
RESTRICTED SECURITIES CERTIFICATE
(FOR TRANSFERS PURSUANT TO SS. 5.5(B)
OF THE TRUST AGREEMENT)
[--------------------------],
as Security Registrar
[address]
Re: 8.05% Capital Securities of
FCB/NC Capital Trust I (the "Trust")
(the "Capital Securities")
Reference is made to the Amended and Restated Trust Agreement, dated as
of March 5 , 1998 (the "Trust Agreement"), among First Citizens BancShares,
Inc., as Depositor, Bankers Trust Company, as Property Trustee and Bankers Trust
(Delaware), as Delaware Trustee, the Administrators named therein, and the
Holders (as defined therein) from time to time. Terms used herein and defined in
the Trust Agreement or in Regulation D, Rule 144A or Rule 144 under the U.S.
Securities Act of 1933 (the "Securities Act") are used herein as so defined.
This certificate relates to $__________ aggregate Liquidation Amount of
Capital Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):
CUSIP No(s).____________________________
CERTIFICATE No(s).______________________
CURRENTLY IN BOOK-ENTRY FORM: __ Yes __ No (check one)
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner."
If the Specified Securities are represented by a Book-Entry Capital Securities
Certificate, they are held through the Clearing Agency or a Clearing Agency
Participant in the name of the Undersigned, as or on behalf of the Owner. If the
Specified Securities are not represented by a Book-Entry Capital Securities
Certificate, they are registered in the name of the Undersigned, as or on behalf
of the Owner.
The Owner has requested that the Specified Securities be transferred to
a person (the "Transferee") who will take delivery in the form of a Restricted
Capital Security. In connection with
<PAGE>
such transfer, the Owner hereby certifies that, unless such transfer is being
effected pursuant to an effective registration statement under the Securities
Act, it is being effected in accordance with Rule 144A, Rule 904 or Rule 144
under the Securities Act and all applicable securities laws of the states of the
United States and other jurisdictions. Accordingly, the Owner hereby further
certifies as follows:
(1) Rule 144A Transfers. If the transfer is being effected in accordance
with Rule 144A:
(A) the Specified Securities are being transferred to a person that the
Owner and any person acting on its behalf reasonably believe is a "qualified
institutional buyer" within the meaning of Rule 144A, acquiring for its own
account or for the account of a qualified institutional buyer; and
(B) the Owner and any person acting on its behalf have taken reasonable
steps to ensure that the Transferee is aware that the Owner may be relying on
Rule 144A in connection with the transfer; and
(2) Rule 904 Transfers. If the transfer is being effected in accordance
with Rule 904:
(A) the Owner is not a distributor of the Securities, an affiliate of
the Depositor or the Trust or any such distributor or a person acting on behalf
of any of the foregoing;
(B) the offer of the Specified Securities was not made to a person in
the United States;
(C) either:
(i) at the time the buy order was originated, the Transferee was
outside the United States or the Owner and any person acting on
its behalf reasonably believed that the Transferee was outside
the United States, or
(ii) the transaction is being executed in, on or through the
facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another designated
offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts within the meaning of Rule 902 of
Regulation S have been made in the United States by or on behalf of the Owner or
any affiliate thereof; and
(E) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
(3) Rule 144 Transfers. If the transfer is being effected pursuant to Rule
144:
(A) the transfer is occurring after a holding period of at least two
years
<PAGE>
(computed in accordance with paragraph (d) of Rule 144 or such shorter time as
may be provided therein) has elapsed since the date the Specified Securities
were acquired from the Depositor or the Trust or from an affiliate (as such term
is defined in Rule 144) of the Depositor or the Trust, whichever is later, and
is being effected in accordance with the applicable amount, manner of sale and
notice requirements of paragraphs (e), (f) and (h) of Rule 144;
(B) the transfer is occurring after a holding period of at least three
years (or such shorter time as may be provided in Rule 144(k) has elapsed since
the date the Specified Securities were acquired from the Depositor or the Trust
or from an affiliate (as such term is defined in Rule 144) of the Depositor or
the Trust, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Depositor or the Trust; or
(C) the Owner is a "qualified institutional buyer" within the meaning
of Rule 144A, and is transferring the Securities to an institution that is an
"accredit investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act in a transaction exempt from the
registration requirements of the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trust and the Initial Purchaser.
Dated:_________________ _____________________________________________
(Print the name of the Undersigned, as such
term is defined in the second paragraph of
this certificate.)
By:__________________________________________
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of the
person signing on behalf of the Undersigned
must be stated.)
GUARANTEE AGREEMENT
BETWEEN
FIRST CITIZENS BANCSHARES, INC.
(AS GUARANTOR)
AND
BANKERS TRUST COMPANY
(AS GUARANTEE TRUSTEE)
DATED AS OF _______ ___, 1998
<PAGE>
FCB/NC CAPITAL TRUST I
<TABLE>
<CAPTION>
Certain Sections of this Guarantee Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Guarantee Agreement
Act Section Section
<S> <C>
Section 310 (a) (1).................................................................4.1 (a)
(a) (2).................................................................4.1 (a)
(a) (3).................................................................Not Applicable
(a) (4).................................................................Not Applicable
(b).....................................................................2.8, 4.1 (c)
Section 311 (a).....................................................................Not Applicable
(b).....................................................................Not Applicable
Section 312 (a).....................................................................2.2 (a)
(b).....................................................................2.2 (b)
(c).....................................................................Not Applicable
Section 313 (a).....................................................................2.3
(a) (4).................................................................2.3
(b).....................................................................2.3
(c).....................................................................2.3
(d).....................................................................2.3
Section 314 (a).....................................................................2.4
(b).....................................................................2.4
(c) (1).................................................................2.5
(c) (2).................................................................2.5
(c) (3).................................................................2.5
(e).....................................................................1.1, 2.5, 3.2
Section 315 (a).....................................................................3.1 (d)
(b).....................................................................2.7
(c).....................................................................3.1 (c)
(d).....................................................................3.1 (d)
(e).....................................................................Not Applicable
Section 316 (a).....................................................................1.1, 2.6, 5.4
(a) (1) (A).............................................................5.4
(a) (1) (B).............................................................5.4
(a) (2).................................................................Not Applicable
(b).....................................................................5.3
(c).....................................................................Not Applicable
Section 317 (a) (1).................................................................Not Applicable
(a) (2).................................................................Not Applicable
(b).....................................................................Not Applicable
Section 318 (a).....................................................................2.1
</TABLE>
Note: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Guarantee Agreement.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
ARTICLE I. DEFINITIONS.................................................................2
SECTION 1.1. Definitions................................................................2
ARTICLE II. TRUST INDENTURE ACT........................................................5
SECTION 2.1. Trust Indenture Act; Application...........................................6
SECTION 2.2. List of Holders...........................................................6
SECTION 2.3. Reports by the Guarantee Trustee...........................................6
SECTION 2.4. Periodic Reports to the Guarantee Trustee..................................6
SECTION 2.5. Evidence of Compliance with Conditions Precedent...........................7
SECTION 2.6. Events of Default; Waiver..................................................7
SECTION 2.7. Event of Default; Notice...................................................7
SECTION 2.8. Conflicting Interests......................................................7
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE.........................8
SECTION 3.1. Powers and Duties of the Guarantee Trustee.................................8
SECTION 3.2. Certain Rights of Guarantee Trustee........................................9
SECTION 3.3. Indemnity..................................................................11
SECTION 3.4. Expenses...................................................................11
ARTICLE IV. GUARANTEE TRUSTEE...........................................................11
SECTION 4.1. Guarantee Trustee; Eligibility.............................................11
SECTION 4.2. Appointment, Removal and Resignation of the Guarantee Trustee..............11
ARTICLE V. GUARANTEE....................................................................12
SECTION 5.1. Guarantee..................................................................12
SECTION 5.2. Waiver of Notice and Demand................................................13
SECTION 5.3. Obligations Not Affected...................................................13
SECTION 5.4. Rights of Holders..........................................................14
SECTION 5.5. Guarantee of Payment.......................................................14
SECTION 5.6. Subrogation................................................................15
SECTION 5.7. Independent Obligations....................................................15
ARTICLE VI. COVENANTS AND SUBORDINATION.................................................15
SECTION 6.1. Subordination..............................................................15
SECTION 6.2. Pari Passu Guarantees......................................................15
ARTICLE VII. TERMINATION................................................................15
SECTION 7.1. Termination................................................................15
<PAGE>
ARTICLE VIII. MISCELLANEOUS.............................................................16
SECTION 8.1. Successors and Assigns.....................................................16
SECTION 8.2. Amendments.................................................................16
SECTION 8.3. Notices....................................................................16
SECTION 8.4. Benefit....................................................................17
SECTION 8.5. Interpretation.............................................................17
SECTION 8.6. Governing Law..............................................................18
SECTION 8.7. Counterparts...............................................................18
</TABLE>
<PAGE>
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of _________, 1998 is
executed and delivered by FIRST CITIZENS BANCSHARES, INC., a Delaware
corporation (the "Guarantor") having its principal office at 3128 Smoketree
Court, Raleigh, North Carolina 27604, and BANKERS TRUST COMPANY, a New York
banking corporation, as trustee (the "Guarantee Trustee"), for the benefit of
the Holders (as defined herein) from time to time of the Capital Securities
(as defined herein) of FCB/NC Capital Trust I, a Delaware statutory
business trust (the "Issuer Trust").
WHEREAS, pursuant to an Amended and Restated Trust Agreement
(the "Trust Agreement"), dated as of March 5, 1998, among First Citizens
BancShares, Inc., as Depositor, Bankers Trust Company, as Property Trustee (the
"Property Trustee"), Bankers Trust (Delaware), as Delaware Trustee (the
"Delaware Trustee") (collectively, the "Issuer Trustees"), the Administrators
named therein and the Holders from time to time of preferred undivided
beneficial ownership interests in the assets of the Issuer Trust, the Issuer
Trust issued $150,000,000 aggregate Liquidation Amount (as defined herein) of
its 8.05% Capital Securities, Liquidation Amount $1,000 per capital security
(the "Old Capital Securities"), representing preferred undivided beneficial
ownership interests in the assets of the Issuer Trust and having the terms set
forth in the Trust Agreement;
WHEREAS, the Old Capital Securities issued by the Issuer Trust
and the proceeds thereof, together with the proceeds from the issuance of the
Issuer Trust's Common Securities (as defined herein), were used to purchase the
Junior Subordinated Debentures due March 1, 2028 (the "Old Junior Subordinated
Debentures") of the Guarantor which were deposited with Bankers Trust Company,
as Property Trustee under the Trust Agreement, as trust assets; and
WHEREAS, as incentive for the Holders to purchase the Old
Capital Securities, the Guarantor irrevocably and unconditionally agreed, to the
extent set forth in the Guarantee Agreement dated as of March 5, 1998 (the "Old
Guarantee"), to pay to the Holders of the Old Capital Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein; and
WHEREAS, in connection with the offer of the Old Capital
Securities, the Guarantor, the Issuer Trust and Wheat, First Securities, Inc.
executed the Registration Rights Agreement dated March 5, 1998 (the
"Registration Rights Agreement").
WHEREAS, the Issuer Trust, in order to satisfy its obligations
under the Registration Rights Agreement, intends to offer (the "Exchange Offer")
up to $150,000,000 aggregate Liquidation Amount of its 8.05% Capital Securities
which have been registered under the Securities Act of 1933 pursuant to a
registration statement (the "New Capital Securities") in exchange for a like
Liquidation Amount of Old Capital Securities; and
WHEREAS, pursuant to the Exchange Offer, the Guarantor is also
exchanging up to $150,000,000 aggregate principal amount of the Old Junior
Subordinated Debentures for up to $150,000,000 aggregate principal amount of the
New Junior Subordinated Debentures due March 1, 2028 (the "New Junior
Subordinated Debentures") of the Guarantor; and
1
<PAGE>
WHEREAS, pursuant to the Exchange Offer, the Guarantor is
required to execute this Guarantee Agreement and exchange the Old Guarantee for
this Guarantee Agreement.
NOW, THEREFORE, in consideration of the exchange by each Holder
of the Old Capital Securities for the New Capital Securities, which exchange the
Guarantor hereby acknowledges shall benefit the Guarantor, (or in the event
certain Holders do not exchange their Old Capital Securities, in order to
fulfill its obligations to such Holders under the Old Guarantee) and intending
to be legally bound hereby, the Guarantor executes and delivers this Guarantee
Agreement for the benefit of the Holders from time to time of the Capital
Securities (as defined herein).
ARTICLE I. DEFINITIONS
SECTION 1.1. Definitions.
As used in this Guarantee Agreement, the terms set forth below
shall, unless the context otherwise requires, have the following meanings.
Capitalized terms used but not otherwise defined herein shall have the meanings
assigned to such terms in the Trust Agreement as in effect on the date hereof.
"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.
"Capital Securities" means both the New Capital Securities
and the Old Capital Securities.
"Common Securities" means the securities representing common
undivided beneficial interests in the assets of the Issuer Trust.
"Distributions" means preferential cumulative cash
distributions accumulating from March 5, 1998 and payable semiannually in
arrears on March 1 and September 1 of each year, commencing September 1, 1998,
at an annual rate of 8.05% of the Liquidation Amount.
"Event of Default" means (i) a default by the Guarantor in any
of its payment obligations under this Guarantee Agreement, or (ii) a default by
the Guarantor in any other obligation hereunder that remains unremedied for 30
days.
2
<PAGE>
"Guarantee Agreement" means this Guarantee Agreement, as
modified, amended or supplemented from time to time.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Capital Securities, to
the extent not paid or made by or on behalf of the Issuer Trust: (i) any
accumulated and unpaid Distributions (as defined in the Trust Agreement)
required to be paid on the Capital Securities, to the extent the Issuer Trust
shall have funds on hand available therefor at such time, (ii) the Redemption
Price, with respect to the Capital Securities called for redemption by the
Issuer Trust to the extent that the Issuer Trust shall have funds on hand
available therefor at such time, and (iii) upon a voluntary or involuntary
termination, winding-up or liquidation of the Issuer Trust, unless the Junior
Subordinated Debentures are distributed to the Holders, the lesser of (a) the
aggregate of the Liquidation Amount and all accumulated and unpaid Distributions
to the date of payment to the extent the Issuer Trust shall have funds on hand
available to make such payment at such time and (b) the amount of assets of the
Issuer Trust remaining available for distribution to Holders on liquidation of
the issuer Trust (in either case, the "Liquidation Distribution").
"Guarantee Trustee" means Bankers Trust Company, until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee Agreement and thereafter means each such
Successor Guarantee Trustee.
"Guarantor" shall have the meaning specified in the first
paragraph of this Guarantee Agreement.
"Holder" means any holder, as registered on the books and
records of the Issuer Trust, of any Capital Securities; provided, however, that,
in determining whether the holders of the requisite percentage of Capital
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor, the Guarantee Trustee, or any Affiliate of the
Guarantor or the Guarantee Trustee.
"Indenture" means the Junior Subordinated Indenture dated as
of March 5, 1998, between First Citizens BancShares, Inc. and Bankers Trust
Company, as trustee, as may be modified, amended or supplemented from time to
time.
"Issuer Trust" shall have the meaning specified in the first
paragraph of this Guarantee Agreement.
"Junior Subordinated Debentures" means both the New Junior
Subordinated Debentures and the Old Junior Subordinated Debentures.
"Like Amount" means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to that portion
of the principal amount of Junior Subordinated Debentures to be
contemporaneously redeemed in accordance with the Indenture, allocated to the
Common Securities and to the Capital Securities based upon the relative
Liquidation Amounts of such classes and (b) with respect to a distribution of
Junior Subordinated Debentures to Holders of Trust Securities in connection with
a dissolution or liquidation of the Issuer Trust, Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Trust
Securities of the Holder to whom such Junior Subordinated Debentures are
distributed.
3
<PAGE>
"Liquidation Amount" means the stated amount of $1,000 per
Capital Security.
"Majority in Liquidation Amount of the Capital Securities"
means, except as provided by the Trust Indenture Act, Capital Securities
representing more than 50% of the aggregate Liquidation Amount of all then
outstanding Capital Securities issued by the Issuer Trust.
"New Capital Securities" shall have the meaning specified in
the fifth Whereas recital of this Guarantee Agreement.
"New Junior Subordinated Debentures" shall have the meaning
specified in the sixth Whereas recital of this Guarantee Agreement.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, Vice Chairman of the Board, Chief Executive Officer,
President, Executive Vice President or a Senior Vice President or Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of the Company, and delivered to the Guarantee Trustee. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Guarantee Agreement shall include:
(a) a statement by each officer signing the Officers'
Certificate that such officer 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 such officer in rendering the
Officers' Certificate;
(c) a statement that 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 such officer,
such condition or covenant has been complied with.
"Old Capital Securities" shall have the meaning specified in
the first Whereas recital of this Guarantee Agreement.
"Old Junior Subordinated Debentures" shall have the meaning
specified in the second Whereas recital of this Guarantee Agreement.
4
<PAGE>
"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.
"Redemption Date" means, with respect to any Capital Security
to be redeemed, the date fixed for such redemption by or pursuant to the Trust
Agreement; provided that each Junior Subordinated Debenture Redemption Date and
the stated maturity of the Junior Subordinated Debentures shall be a Redemption
Date for a Like Amount of Capital Securities.
"Redemption Price" shall have the meaning specified in the
Trust Agreement.
"Responsible Officer" means, when used with respect to the
Guarantee Trustee, any officer assigned to the Corporate Trust Office, including
any managing director, vice president, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Guarantee Trustee
customarily performing functions similar to those performed by any of the above
designated officers and having direct responsibility for the administration of
this Indenture, and also, with respect to a particular matter, any other officer
to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Senior Indebtedness" shall have the meaning specified in the
Indenture.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Agreement" shall have the meaning specified in the
first Whereas recital of this Guarantee Agreement.
"Trust Indenture Act" means the Trust Indenture Act of 1939
(15 U.S.C.ss.ss.77aaa-77bbbb), as amended.
"Trust Securities" means the Common Securities and the Capital
Securities.
ARTICLE II. TRUST INDENTURE ACT
SECTION 2.1. Trust Indenture Act; Application.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Guarantee Agreement, the provision of the Trust
Indenture Act shall control. If any provision of this Guarantee Agreement
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the latter provision shall be deemed to apply to this
Guarantee Agreement as so modified or excluded, as the case may be.
5
<PAGE>
SECTION 2.2. List of Holders.
(a) The Guarantor will furnish or cause to be furnished to the
Guarantee Trustee a list of Holders at the following times:
(i) semiannually, not more than 15 days after
February 15 and August 15 in each year, a list, in such form as the Guarantee
Trustee may reasonably require, of the names and addresses of the Holders as
of February 15 and August 15; and
(ii) at such other times as the Guarantee Trustee may
request in writing, within 30 days after the receipt by the Guarantor of any
such request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished.
(b) The Guarantee Trustee shall comply with the
requirements of Section 312(b) of the Trust Indenture Act.
SECTION 2.3. Reports by the Guarantee Trustee.
Not later than January 31 of each year, commencing January 31,
1999, the Guarantee Trustee shall provide to the Holders such reports, if any,
as are required by Section 313 of the Trust Indenture Act 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. If this Guarantee Agreement shall have been qualified under the Trust
Indenture Act, the Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4. Periodic Reports to the Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, and the
Holders such documents, reports and information, if any, as required by Section
314 of the Trust Indenture Act and the compliance certificate required by
Section 314 of the Trust Indenture Act, in the form, in the manner and at the
times required by Section 314 of the Trust Indenture Act, provided that such
documents, reports and information shall be required to be provided to the
Securities and Exchange Commission only if this Guarantee Agreement shall have
been qualified under the Trust Indenture Act.
6
<PAGE>
SECTION 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such
evidence of compliance with such conditions precedent, if any, provided for in
this Guarantee 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) 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 Capital
Securities may, by vote, on behalf of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Guarantee Agreement, 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. Event 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, notice of all Events of Default known to the Guarantee
Trustee, unless such Events of Default have been cured before the giving of such
notice; provided 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.
(b) The Guarantee Trustee shall not be deemed to have knowledge
of any Event of Default unless a Responsible Officer charged with the
administration of this Guarantee Agreement shall have received written notice of
such Event of Default.
SECTION 2.8. Conflicting Interests.
The Trust Agreement shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
7
<PAGE>
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
SECTION 3.1. Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee
Trustee for the benefit of the Holders, and the Guarantee Trustee shall not
transfer this Guarantee Agreement to any Person except a Holder exercising his
or her rights pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee hereunder. The right, title and interest of the
Guarantee Trustee, as such, hereunder 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 has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the
Holders.
(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 be obligated to perform only such duties as are specifically set forth in
this Guarantee Agreement (including pursuant to Section 2.1), and no implied
covenants shall be read into this Guarantee Agreement against the Guarantee
Trustee. If an Event of Default has occurred (that has not been cured or waived
pursuant to Section 2.6), the Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Guarantee Agreement, 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 Guarantee Agreement 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
Guarantee Agreement (including pursuant to Section 2.1), and the Guarantee
Trustee shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Guarantee Agreement (including
pursuant to Section 2.1); 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 Guarantee
Agreement; but in the case of any such certificates or opinions that by
any provision hereof or of the Trust Indenture Act 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 Guarantee Agreement;
8
<PAGE>
(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 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 Capital 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 Guarantee
Agreement; and
(iv) No provision of this Guarantee Agreement 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 or liability is not
assured to it under the terms of this Guarantee Agreement or adequate indemnity
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 reasonably believed by it to be
genuine and to have been signed, sent or presented by the proper party or
parties.
(ii) Any direction or act of the Guarantor
contemplated by this Guarantee Agreement shall be sufficiently evidenced by an
Officers' Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this
Guarantee Agreement, the Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting to
take 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 from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
9
<PAGE>
(iv) The Guarantee Trustee may consult with legal
counsel, and the advice or written opinion of such legal counsel with respect
to legal matters shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by it hereunder in
good faith and in accordance with such advice or opinion. Such legal counsel
may be legal counsel to the Guarantor or any of its Affiliates and may be
one of its employees. The Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction.
(v) The Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Guarantee Agreement at the request or direction of any Holder, unless such
Holder shall have provided to the Guarantee Trustee such security and indemnity
as would satisfy a reasonable person in the position of the Guarantee
Trustee, against the costs, expenses (including attorneys' fees and
expenses) 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.
(vi) 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.
(vii) The Guarantee 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, and the Guarantee Trustee shall not be
responsible for any negligence or wilful misconduct on the part of any such
agent or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this
Guarantee Agreement 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, (B) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received and (C)
shall be fully protected in acting in accordance with such instructions.
(b) No provision of this Guarantee Agreement 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 to act in accordance with such power and
authority.
10
<PAGE>
SECTION 3.3. Indemnity.
The Guarantor agrees to indemnify the Guarantee Trustee for,
and to hold it harmless against, any loss, liability or expense incurred without
negligence, wilful misconduct or bad faith on the part of the Guarantee Trustee,
arising out of or in connection with the acceptance or administration of this
Guarantee 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 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 Guarantee Agreement.
SECTION 3.4. Expenses.
The Guarantor shall from time to time reimburse the Guarantee
Trustee for its expenses and costs (including reasonable attorneys' or agents'
fees) incurred in connection with the performance of its duties hereunder.
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 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, and shall be a corporation meeting the requirements of Section
310(c) of the Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
supervising or examining authority, then, for the purposes of this Section and
to the extent permitted by the Trust Indenture Act, 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) 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.
11
<PAGE>
SECTION 4.2. Appointment, Removal and Resignation of the Guarantee
Trustee.
(a) No resignation or removal of the Guarantee Trustee and no
appointment of a Successor Guarantee Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the Successor Guarantee
Trustee by written instrument executed by the Successor Guarantee Trustee and
delivered to the Holders and the Guarantee Trustee.
(b) Subject to the immediately preceding paragraph, a Guarantee
Trustee may resign at any time by giving written notice thereof to the Holders.
The Guarantee Trustee shall appoint a successor by requesting from at least
three Persons meeting the eligibility requirements such Person's expenses and
charges to serve as the Guarantee Trustee, and selecting the Person who agrees
to the lowest expenses and charges. If the instrument of acceptance by the
Successor Guarantee Trustee shall not have been delivered to the Guarantee
Trustee within 60 days after the giving of such notice of resignation, the
Guarantee Trustee may petition, at the expense of the Guarantor, any court of
competent jurisdiction for the appointment of a Successor Guarantee Trustee.
(c) The Guarantee Trustee may be removed for cause at any time
by Act (within the meaning of Section 6.8 of the Trust Agreement) of the Holders
of at least a Majority in Liquidation Amount of the Capital Securities,
delivered to the Guarantee Trustee.
(d) If a resigning Guarantee Trustee shall fail to appoint a
successor, or if a Guarantee Trustee shall be removed or become incapable of
acting as Guarantee Trustee, or if any vacancy shall occur in the office of any
Guarantee Trustee for any cause, the Holders of the Capital Securities, by Act
of the Holders of record of not less than 25% in aggregate Liquidation Amount of
the Capital Securities then outstanding delivered to such Guarantee Trustee,
shall promptly appoint a successor Guarantee Trustee. If no Successor Guarantee
Trustee shall have been so appointed by the Holders of the Capital Securities
and such appointment accepted by the Successor Guarantee Trustee, any Holder, on
behalf of himself and all others similarly situated, may petition any court of
competent jurisdiction for the appointment of a Successor Guarantee Trustee.
ARTICLE V. GUARANTEE
SECTION 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by or on behalf of the Issuer Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which the Issuer
Trust may have or assert, except the defense of payment. 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 Trust
to pay such amounts to the Holders. The Guarantor shall give prompt written
notice to the Guarantee Trustee in the event it makes any direct payment
hereunder.
12
<PAGE>
SECTION 5.2. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the
Guarantee Agreement 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 Trust 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 Guarantee Agreement 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 Trust of any express or implied
agreement, covenant, term or condition relating to the Capital Securities to be
performed or observed by the Issuer Trust;
(b) the extension of time for the payment by the Issuer Trust
of all or any portion of the Distributions (other than an extension of time for
payment of Distributions that results from the extension of any interest payment
period on either or both the New Junior Subordinated and/or the Old Junior
Subordinated Debentures as so provided in the Indenture), Redemption Price,
Liquidation Distribution or any other sums payable under the terms of the
Capital Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Capital Securities;
(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 Capital
Securities, or any action on the part of the Issuer Trust 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 Trust or any of
the assets of the Issuer Trust;
(e) any invalidity of, or defect or deficiency in, the
Capital Securities;
(f) the settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
13
<PAGE>
(g) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor (other than
payment of the underlying obligation), 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 the consent of, the Guarantor with respect to the happening of any of
the foregoing.
SECTION 5.4. Rights of Holders.
The Guarantor expressly acknowledges that: (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the
benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this
Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in
Liquidation Amount of the Capital Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of this Guarantee Agreement or exercising any trust
or power conferred upon the Guarantee Trustee under this Guarantee Agreement;
and (iv) any Holder may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Guarantee Agreement, without first
instituting a legal proceeding against the Guarantee Trustee, the Issuer Trust
or any other Person.
SECTION 5.5. Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not
of collection. This Guarantee Agreement will not be discharged except by payment
of the Guarantee Payments in full (without duplication of amounts theretofore
paid by the Issuer Trust) or upon the distribution of New Junior Subordinated
Debentures and the Old Junior Subordinated Debentures, if any Old Junior
Subordinated Debentures remain outstanding after the Exchange Offer, to Holders
as provided in the Trust Agreement.
14
<PAGE>
SECTION 5.6. Subrogation.
The Guarantor shall be subrogated to all rights (if any) of the
Holders against the Issuer Trust in respect of any amounts paid to the Holders
by the Guarantor under this Guarantee Agreement; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any rights which it may acquire by way
of subrogation or any indemnity, reimbursement or other agreement, in all cases
as a result of payment under this Guarantee Agreement, if at the time of any
such payment, any amounts are due and unpaid under this Guarantee Agreement. 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 Trust with respect to the Capital
Securities and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Guarantee
Agreement notwithstanding the occurrence of any event referred to in subsections
(a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI. COVENANTS AND SUBORDINATION
SECTION 6.1. Subordination.
This Guarantee Agreement will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of payment to all Senior
Indebtedness of the Guarantor to the extent and in the manner set forth in the
Indenture with respect to both the New Junior Subordinated Debentures and the
Old Junior Subordinated Debentures, and the provisions of Article XIII of the
Indenture will apply, mutatis mutandis, to the obligations of the Guarantor
hereunder. The obligations of the Guarantor hereunder do not constitute Senior
Indebtedness of the Guarantor.
SECTION 6.2. Pari Passu Guarantees.
The obligations of the Guarantor under this Guarantee Agreement
shall rank pari passu with any similar guarantee agreements issued by the
Guarantor on behalf of the holders of preferred or capital securities issued by
the Issuer Trust and with any other security, guarantee or other obligation that
is expressly stated to rank pari passu with the obligations of the Guarantor
under this Guarantee Agreement.
ARTICLE VII. TERMINATION
SECTION 7.1. Termination.
This Guarantee Agreement shall terminate and be of no further
force and effect upon (i) full payment of the Redemption Price of all Capital
Securities, (ii) the distribution of New Junior Subordinated Debentures and the
Old Junior Subordinated Debentures, if any Old Junior Subordinated Debentures
remain outstanding after the Exchange Offer, to the Holders in exchange for all
of the Capital Securities or (iii) full payment of the amounts payable in
accordance with Article IX of the Trust Agreement upon liquidation of the Issuer
Trust. Notwithstanding the foregoing, this Guarantee Agreement will continue to
be effective or will be reinstated, as the case may be, if at any time any
Holder is required to restore payment of any sums paid under the Capital
Securities or this Guarantee Agreement.
15
<PAGE>
ARTICLE VIII. MISCELLANEOUS
SECTION 8.1. Successors and Assigns.
All guarantees and agreements contained in this Guarantee
Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Capital Securities then outstanding. Except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under
Article VIII of the Indenture and pursuant to which the assignee agrees in
writing to perform the Guarantor's obligations hereunder, the Guarantor shall
not assign its obligations hereunder, and any purported assignment that is not
in accordance with these provisions shall be void.
SECTION 8.2. Amendments.
Except with respect to any changes that do not materially
adversely affect the rights of the Holders (in which case no consent of the
Holders will be required), this Guarantee Agreement may only be amended with the
prior approval of the Holders of not less than a Majority in Liquidation Amount
of the Capital Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.
SECTION 8.3. Notices.
Any notice, request or other communication required or
permitted to be given hereunder shall be in writing, duly signed by the party
giving such notice, and delivered, telecopied (confirmed by delivery of the
original) or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address or telecopy
number set forth below or such other address or telecopy number or to the
attention of such other Person as the Guarantor may give notice to the Holders:
First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, North Carolina 27604
Facsimile No.: (919) 716-2844
Attention: Kenneth A. Black
(b) if given to the Issuer Trust, in care of the Guarantee
Trustee, at the Issuer Trust's (and the Guarantee Trustee's) address set forth
below or such other address or telecopy number or to the attention of such other
Person as the Guarantee Trustee on behalf of the Issuer Trust may give notice to
the Holders:
FCB/NC Capital Trust I
c/o First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, North Carolina 27604
Facsimile No.: (919) 716-2844
Attention: Kenneth A. Black
16
<PAGE>
with a copy to:
Bankers Trust Company
Four Albany Street - 4th Floor
New York, NY 10006
Facsimile No.: (212) 250-6961
Attention: Corporate Trust and Agency Group;
Corporate Market Services
(c) if given to the Guarantee Trustee:
Bankers Trust Company
Four Albany Street - 4th Floor
New York, NY 10006
Facsimile No.: (212) 250-6961
Attention: Corporate Trust and Agency Group;
Corporate Market Services
(d) if given to any Holder, at the address set forth on the
books and records of the Issuer Trust.
All notices hereunder shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 8.4. Benefit.
This Guarantee Agreement is solely for the benefit of the
Holders and is not separately transferable from the Capital Securities.
SECTION 8.5. Interpretation.
In this Guarantee Agreement, unless the context otherwise
requires:
(a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in
Section 1.1 and if not defined in Section 1.1, shall have the meaning ascribed
to them in the Trust Agreement as in effect on the date hereof;
(b) a term defined anywhere in this Guarantee Agreement has
the same meaning throughout;
(c) all references to "the Guarantee Agreement" or "this
Guarantee Agreement" are to this Guarantee Agreement as modified, supplemented
or amended from time to time;
17
<PAGE>
(d) all references in this Guarantee Agreement to Articles and
Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee Agreement unless otherwise defined in this
Guarantee Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and
vice versa; and
(g) the masculine, feminine or neuter genders used herein
shall include the masculine, feminine and neuter genders.
SECTION 8.6. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
SECTION 8.7. Counterparts.
This instrument 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.
THIS GUARANTEE AGREEMENT is executed as of the day and year
first above written.
FIRST CITIZENS BANCSHARES, INC.
as Guarantor
By:
------------------------
Name:
Title:
BANKERS TRUST COMPANY,
as Guarantee Trustee, and not in its
individual capacity
By:
------------------------
Name:
Title:
18
EXHIBIT 4.3
JUNIOR SUBORDINATED INDENTURE
Between
FIRST CITIZENS BANCSHARES, INC.
and
BANKERS TRUST COMPANY
(as Trustee)
dated as of March 5, 1998
<PAGE>
FCB/NC CAPITAL TRUST I
Certain Sections of this Junior Subordinated Indenture relating
to Sections 310 through 318 of the
Trust Indenture Act of 1939:
Trust Indenture Junior Subordinated
Act Section Indenture Section
----------- -----------------
Section 310 (a)(1)...................................6.9
(a)(2)...................................6.9
(a)(3)...................................Not Applicable
(a)(4)...................................Not Applicable
(a)(5)...................................6.9
(b)......................................6.8, 6.10
Section 311 (a)......................................6.13
(b)......................................6.13
(b)(2)...................................7.3(a)
Section 312 (a)......................................7.1, 7.2(a)
(b)......................................7.2(b)
(c)......................................7.2(c)
Section 313 (a)......................................7.3(a)
(a)(4)...................................7.3(a)
(b)......................................7.3(b)
(c)......................................7.3(a)
(d)......................................7.3(c)
Section 314 (a)......................................7.4
(b)......................................7.4
(c)(1)...................................1.2
(c)(2)...................................1.2
(c)(3)...................................Not Applicable
(e)......................................1.2
Section 315 (a)......................................6.1(a)
(b)......................................6.2, 7.3
(c)......................................6.1(b)
(d)......................................6.1(c)
(e)......................................5.14
Section 316 (a)......................................5.12
(a)(1)(A)................................5.12
(a)(1)(B)................................5.13
(a)(2)...................................Not Applicable
(b)......................................5.8
(c)......................................1.4(f)
Section 317 (a)(1)...................................5.3
(a)(2)...................................5.4
(b)......................................10.3
Section 318 (a)......................................1.7
<PAGE>
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION.................................2
SECTION 1.1. Definitions.........................................2
SECTION 1.2. Compliance Certificate and Opinions................11
SECTION 1.3. Forms of Documents Delivered to
Trustee............................................12
SECTION 1.4. Acts of Holders....................................12
SECTION 1.5. Notices, Etc. to Trustee and Company...............14
SECTION 1.6. Notice to Holders; Waiver..........................15
SECTION 1.7. Conflict with Trust Indenture Act..................15
SECTION 1.8. Effect of Headings and Table of
Contents...........................................15
SECTION 1.9. Successors and Assigns.............................15
SECTION 1.10. Separability Clause................................15
SECTION 1.11. Benefits of Indenture..............................16
SECTION 1.12. Governing Law......................................16
SECTION 1.13. Non-Business Days..................................16
ARTICLE II SECURITY FORMS.....................................16
SECTION 2.1. Forms Generally....................................16
SECTION 2.2. Form of Face of Security...........................17
SECTION 2.3. Form of Reverse of Security........................21
SECTION 2.4. Additional Provisions Required in
Global Security....................................25
SECTION 2.5. Form of Trustee's Certificate
of Authentication..................................26
ARTICLE III THE SECURITIES.....................................26
SECTION 3.1. Title and Terms....................................26
SECTION 3.2. Denominations......................................29
SECTION 3.3. Execution, Authentication, Delivery
and Dating.........................................29
SECTION 3.4. Temporary Securities...............................31
SECTION 3.5. Global Securities..................................31
SECTION 3.6. Registration, Transfer and Exchange
Generally; Certain Transfers and
Exchanges; Securities Act Legends..................32
SECTION 3.7. Mutilated, Lost and Stolen Securities..............35
SECTION 3.8. Payment of Interest and Additional
Interest; Interest Rights Preserved................36
SECTION 3.9. Persons Deemed Owners..............................37
SECTION 3.10. Cancellation.......................................37
SECTION 3.11. Computation of Interest............................38
SECTION 3.12. Deferrals of Interest Payment Dates................38
<PAGE>
SECTION 3.13. Right of Set-Off...................................39
SECTION 3.14. Agreed Tax Treatment...............................39
SECTION 3.15. Shortening or Extension of Stated
Maturity...........................................40
SECTION 3.16. CUSIP Numbers......................................40
ARTICLE IV SATISFACTION AND DISCHARGE.........................40
SECTION 4.1. Satisfaction and Discharge of Indenture............40
SECTION 4.2. Application of Trust Money.........................41
ARTICLE V REMEDIES...........................................42
SECTION 5.1. Events of Default..................................42
SECTION 5.2. Acceleration of Maturity; Rescission
and Annulment......................................43
SECTION 5.3. Collection of Indebtedness and Suits
for Enforcement by Trustee.........................44
SECTION 5.4. Trustee May File Proofs of Claim...................45
SECTION 5.5. Trustee May Enforce Claim Without
Possession of Securities...........................46
SECTION 5.6. Application of Money Collected.....................46
SECTION 5.7. Limitation on Suits................................46
SECTION 5.8. Unconditional Right of Holders to
Receive Principal, Premium and
Interest; Direct Action by Holders
of Capital Securities..............................47
SECTION 5.9. Restoration of Rights and Remedies.................47
SECTION 5.10. Rights and Remedies Cumulative.....................48
SECTION 5.11. Delay or Omission Not Waiver.......................48
SECTION 5.12. Control by Holders.................................48
SECTION 5.13. Waiver of Past Defaults............................48
SECTION 5.14. Undertaking for Costs..............................49
SECTION 5.15. Waiver of Usury, Stay or Extension Laws............49
ARTICLE VI THE TRUSTEE........................................50
SECTION 6.1. Certain Duties and Responsibilities................50
SECTION 6.2. Notice of Defaults.................................51
SECTION 6.3. Certain Rights of Trustee..........................51
SECTION 6.4. Not Responsible for Recitals or
Issuance of Securities.............................52
SECTION 6.5. May Hold Securities................................52
SECTION 6.6. Money Held in Trust................................52
SECTION 6.7. Compensation and Reimbursements....................53
SECTION 6.8. Disqualification; Conflicting Interests............54
SECTION 6.9. Corporate Trustee Required;
Eligibility........................................54
SECTION 6.10. Resignation and Removal; Appointment
<PAGE>
of Successor.......................................54
SECTION 6.11. Acceptance of Appointment
of Successor.......................................56
SECTION 6.12. Merger, Conversion, Consolidation or
Succession to Business.............................57
SECTION 6.13. Preferential Collection of Claims
Against Company....................................57
SECTION 6.14. Appointment of Authenticating Agent................57
ARTICLE VII HOLDER'S LISTS AND REPORTS BY TRUSTEE,
PAYING AGENT AND COMPANY...........................59
SECTION 7.1. Company to Furnish Trustee Names and
Addresses of Holders...............................59
SECTION 7.2. Preservation of Information;
Communications to Holders..........................59
SECTION 7.3. Reports by Trustee and Paying Agent................60
SECTION 7.4. Reports by Company.................................60
ARTICLE VIII CONSOLIDATION, MERGER, CONVEYANCE,
TRANSFER OR LEASE..................................60
SECTION 8.1. Company May Consolidate, Etc., Only
on Certain Terms...................................60
SECTION 8.2. Successor Company Substituted..................... 61
ARTICLE IX SUPPLEMENTAL INDENTURES............................62
SECTION 9.1. Supplemental Indentures Without Consent
of Holders.........................................62
SECTION 9.2. Supplemental Indentures With Consent
of Holders.........................................63
SECTION 9.3. Execution of Supplemental Indentures...............65
SECTION 9.4. Effect of Supplemental Indentures..................65
SECTION 9.5. Conformity with Trust Indenture Act................65
SECTION 9.6. Reference in Securities to
Supplemental Indentures............................65
ARTICLE X COVENANTS..........................................65
SECTION 10.1. Payment of Principal, Premium and
Interest...........................................65
SECTION 10.2. Maintenance of Office or Agency....................66
SECTION 10.3. Money for Security Payments to be
Held in Trust......................................66
SECTION 10.4. Statement as to Compliance.........................67
SECTION 10.5. Waiver of Certain Covenants........................68
SECTION 10.6. Additional Sums....................................68
SECTION 10.7. Additional Covenants...............................68
-iii-
<PAGE>
SECTION 10.8. Furnishing Annual Information......................69
ARTICLE XI REDEMPTION OF SECURITIES...........................70
SECTION 11.1. Applicability of This Article......................70
SECTION 11.2 Election to Redeem; Notice of Trustee..............70
SECTION 11.3. Selection of Securities to be Redeemed.............70
SECTION 11.4. Notice of Redemption...............................71
SECTION 11.5. Deposit of Redemption Price........................72
SECTION 11.6. Payment of Securities Called for
Redemption.........................................72
SECTION 11.7. Right of Redemption of Securities
Initially Issued to an Issuer Trust................72
ARTICLE XII SINKING FUNDS......................................73
ARTICLE XIII SUBORDINATION OF SECURITIES........................73
SECTION 13.1. Securities Subordinate to Senior
Indebtedness.......................................73
SECTION 13.2. No Payment When Senior Indebtedness
in Default; Payment Over of Proceeds
Upon Dissolution, Etc..............................73
SECTION 13.3. Payment Permitted If No Default....................75
SECTION 13.4. Subrogation to Rights of Holders of
Senior Indebtedness................................75
SECTION 13.5. Provisions Solely to Define Relative
Rights.............................................75
SECTION 13.6. Trustee to Effectuate Subordination................76
SECTION 13.7. No Waiver of Subordination Provisions..............76
SECTION 13.8. Notice to Trustee..................................76
SECTION 13.9. Reliance on Judicial Order or
Certificate of Liquidating Agent...................77
SECTION 13.10. Trustee Not Fiduciary for Holders of
Senior Indebtedness................................77
SECTION 13.11. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of
Trustee's Rights...................................78
SECTION 13.12. Article Applicable to Paying Agents................78
SECTION 13.13. Certain Conversions or Exchanges
Deemed Payment.....................................78
ANNEX A FORM OF RESTRICTED SECURITIES
CERTIFICATE
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JUNIOR SUBORDINATED INDENTURE
THIS JUNIOR SUBORDINATED INDENTURE, dated as of March 5, 1998, is
between FIRST CITIZENS BANCSHARES, INC., a Delaware corporation (the "Company"),
having its principal office at 3128 Smoketree Court, Raleigh, North Carolina
27604, and BANKERS TRUST COMPANY, as Trustee, having its principal office at
Four Albany Street, 4th Floor, New York, New York 10006 (the "Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
junior subordinated debt securities in series (hereinafter called the
"Securities") of substantially the tenor hereinafter provided, including
Securities issued to evidence loans made to the Company from the proceeds from
the issuance from time to time by one or more business trusts (each an "Issuer
Trust") of undivided preferred beneficial interests in the assets of such Issuer
Trusts (the "Capital Securities") and common undivided interests in the assets
of such Issuer Trusts (the "Common Securities" and, collectively with the
Capital Securities, the "Trust Securities"), and to provide the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered; and
WHEREAS, all things necessary to make this Indenture a valid agreement
of the Company, in accordance with its terms, have been done.
NOW THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders (as such term is defined in Section 1.1 hereof)
thereof, it is mutually covenanted and agreed, for the equal and proportionate
benefit of all Holders of the Securities or of any series thereof, and intending
to be legally bound hereby, as follows:
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) The terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
(2) 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;
(3) The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";
(4) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles as
in effect at the time of computation;
(5) Whenever the context may require, any gender shall be deemed to
include the other;
(6) 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 Indenture; and
(7) The words "hereby", "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.
"Act" when used with respect to any Holder has the meaning specified in
Section 1.4(a).
"Additional Interest" means 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" has the meaning specified in Section 10.6.
"Additional Taxes" means any additional taxes, duties and other
governmental charges to which an Issuer Trust has become subject from time to
time as a result of a Tax Event.
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"Administrator" means, in respect of any Issuer Trust, each Person
appointed in accordance with the related Trust Agreement, solely in such
Person's capacity as Administrator of such Issuer Trust and not in such Person's
individual capacity, or any successor Administrator appointed as therein
provided.
"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.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Global Security, in each case to
the extent applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means the board of directors of the Company or the
Executive Committee of the board of directors of the Company (or any other
committee of the board of directors of the Company performing similar functions)
or, for purposes of this Indenture, a committee designated by the board of
directors of the Company (or such committee), comprised of two or more members
of the board of directors of the Company or officers of the Company, or both.
"Board Resolution" means a copy of a resolution certified by the
Secretary or any Assistant Secretary of the Company to have been duly adopted by
the Board of Directors, or such committee of the Board of Directors or officers
of the Company to which authority to act on behalf of the Board of Directors has
been delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii)
a day on which banking institutions in the City of New York, New York, or the
City of Raleigh, North Carolina, are authorized or required by law or executive
order to remain closed, or (iii) a day on which the Corporate Trust Office of
the Trustee, or, with respect to the Securities of a series initially issued to
an Issuer Trust, the "Corporate Trust Office" (as defined in the related Trust
Agreement) of the Property Trustee or the Delaware Trustee under the related
Trust Agreement, is closed for business.
"Capital Securities" has the meaning specified in the first recital of
this Indenture.
"Capital Treatment Event" means, in respect of any Issuer Trust, the
reasonable determination by the Company that, as a result of the occurrence of
any amendment to, or change (including any announced prospective change) in, the
laws (or any rules or regulations thereunder)
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of the United States or any political subdivision thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or such pronouncement, action or decision is announced on or
after the date of the issuance of the Capital Securities of such Issuer Trust,
there is more than an insubstantial risk that the Company will not be entitled
to treat an amount equal to the Liquidation Amount of such Capital Securities as
"Tier 1 Capital" (or the then equivalent thereof) for purposes of the risk-based
capital adequacy guidelines of the Board of Governors of the Federal Reserve
System, as then in effect and applicable to the Company.
"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 instrument such Commission is not existing and performing
the duties now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
"Common Securities" has the meaning specified in the first recital of
this Indenture.
"Common Stock" means the common stock, $1.00 par value per share, of
the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor entity shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor entity.
"Company Request" and "Company Order" mean, respectively, the written
request or order signed in the name of the Company by its Chairman of the Board
of Directors, any Vice Chairman of the Board of Directors, its President or a
Senior Vice President or Vice President, and by its Chief Financial Officer, its
Treasurer or an Assistant Treasurer, or its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered.
"Creditor" has the meaning specified in Section 6.7(c).
"Defaulted Interest" has the meaning specified in Section 3.8.
"Delaware Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Delaware Trustee" in the related Trust Agreement, solely in
its capacity as Delaware Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor Delaware trustee appointed as therein provided.
"Depositary" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more Global
Securities, the Person designated as Depositary by the Company pursuant to
Section 3.1 with respect to such series (or any successor thereto).
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"Discount Security" means any security that provides for an amount less
than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2.
"Dollar" or "$" means the currency of the United States of America
that, as at the time of payment, is legal tender for the payment of public and
private debts.
The term "entity" includes a bank, corporation, association, company,
limited liability company, joint-stock company or business trust.
"Event of Default," unless otherwise specified in the supplemental
indenture creating a series of Securities, has the meaning specified in Article
V.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Extension Period" has the meaning specified in Section 3.12.
"Global Security" means a Security in the form prescribed in Section
2.4 evidencing all or part of a series of Securities, issued to the Depositary
or its nominee for such series, and registered in the name of such Depositary or
its nominee.
"Guarantee" means, with respect to any Issuer Trust, the Guarantee
Agreement executed by the Company for the benefit of the Holders of the Capital
Securities issued by such Issuer Trust, as modified, amended or supplemented
from time to time.
"Holder" means a Person in whose name a Security is registered in the
Securities Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof
and shall include the terms of each particular series of Securities established
as contemplated by Section 3.1.
"Institutional Accredited Investor" means an institutional accredited
investor within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act.
"Interest Payment Date" means, as to each series of Securities, the
Stated Maturity of an installment of interest on such Securities.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Investment Company Event" means the receipt by an Issuer Trust of an
Opinion of Counsel (as defined in the relevant Trust Agreement) experienced in
such matters to the effect that, as a result
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of the occurrence of a change in law or regulation or a written change
(including any announced prospective 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 Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the issuance of the Capital Securities of such Issuer Trust.
"Issuer Trust" has the meaning specified in the first recital of this
Indenture.
"Liquidation Amount" shall have the meaning assigned in the applicable
related Trust Agreement.
"Maturity" when used with respect to any Security means 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.
"Notice of Default" means a written notice of the kind specified in
Section 5.1(3).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board of Directors, Vice Chairman of the Board of Directors , Chief
Executive Officer, the President or a Vice President, and by the Chief Financial
Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company, and delivered to the party provided herein. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(a) a statement by each officer signing the Officers' Certificate that
such officer 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 such officer in rendering the Officers' Certificate;
(c) a statement that 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 or an employee of the Company or any Affiliate of the Company.
"Original Issue Date" means the date of issuance specified as such in
each Security.
"Outstanding" means, when used in reference to any Securities, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
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(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for whose payment money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent in trust for the
Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other
Securities have been authenticated and delivered or that have been paid
pursuant to Section 3.6, unless proof satisfactory to the Trustee is presented
that any such Securities are held by Holders in whose hands such Securities are
valid, binding and legal obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor (other than, for the avoidance of doubt, the
Issuer Trust to which Securities of the applicable series were initially issued)
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Securities that the Trustee knows to be so owned shall be so disregarded.
Securities so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or such other obligor (other than, for the avoidance of doubt, such
Issuer Trust). Upon the written request of the Trustee, the Company shall
furnish to the Trustee promptly an Officers' Certificate listing and identifying
all Securities, if any, known by the Company to be owned or held by or for the
account of the Company, or any other obligor on the Securities or any Affiliate
of the Company or such obligor (other than, for the avoidance of doubt, such
Issuer Trust), and, subject to the provisions of Section 6.1, 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.
"Paying Agent" means the Trustee or any Person authorized by the
Company to pay the principal of (or premium, if any) or interest on, or other
amounts in respect of any Securities on behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Place of Payment" means, with respect to the Securities of any series,
the place or places where the principal of (and premium, if any) and interest on
the Securities of such series are payable pursuant to Section 3.1.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security. For the purposes of this definition, any security
authenticated and delivered under Section 3.7 in lieu of a mutilated,
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destroyed, lost or stolen Security shall be deemed to evidence the same debt as
the mutilated, destroyed, lost or stolen Security.
"Principal Subsidiary Bank" means each of (i) First-Citizens Bank &
Trust Company, a North Carolina banking corporation, (ii) First-Citizens Bank &
Trust Company, a West Virginia banking corporation , (iii) Atlantic States Bank,
a Federal thrift institution, (iv) any other banking subsidiary of the Company
the consolidated assets of which constitute 20% or more of the consolidated
assets of the Company and its consolidated subsidiaries, (v) any other banking
subsidiary designated as a Principal Subsidiary Bank pursuant to a Board
Resolution and set forth in an Officers' Certificate delivered to the Trustee,
and (vi) any subsidiary of the Company that owns, directly or indirectly, any
voting securities, or options, warrants or rights to subscribe for or purchase
voting securities, of any Principal Subsidiary Bank under clause (i), (ii),
(iii), (iv) or (v), and in the case of clause (i), (ii), (iii), (iv), (v) or
(vi), their respective successors (whether by consolidation, merger, conversion,
transfer of substantially all their assets and business or otherwise) so long as
any such successor is a banking subsidiary (in the case of clause (i), (ii),
(iii), (iv) or (v) or a subsidiary (in the case of clause (vi))) of the Company.
"Proceeding" has the meaning specified in Section 13.2.
"Property Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Property Trustee" in the related Trust Agreement, solely in
its capacity as Property Trustee of such Issuer 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.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture or the terms of such Security.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 3.1 with respect to Securities of such series, the close of
business on the fifteenth day of the month next preceding such Interest Payment
Date (whether or not a Business Day).
"Responsible Officer", when used with respect to the Property Trustee
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, principal, assistant vice president, assistant
treasurer, assistant secretary or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and having direct responsibility for the administration of this
Indenture, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Restricted Security" means each Security required pursuant to Section
3.6(c) to bear a Restricted Securities Legend.
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"Restricted Securities Certificate" means a certificate substantially
in the form set forth in Annex A.
"Restricted Securities Legend" means a legend substantially in the form
of the legend required in the form of Security set forth in Section 2.2 to be
placed upon a Restricted Security.
"Rights Plan" means any 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 any class or series of
capital stock of the Company which rights (i) are deemed to be transferred with
such shares of such Common Stock, (ii) are not exercisable, and (iii) are also
issued in respect of future issuances of such Common Stock, in each case until
the occurrence of a specified event or events.
"Securities" or "Security" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.
"Securities Act" means the Securities Act of 1933, as modified, amended
or supplemented from time to time.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.6(a).
"Senior Indebtedness" means, whether recourse is to all or a portion of
the assets of the Company and whether or not contingent: (i) every obligation of
the Company for money borrowed; (ii) every obligation of the Company evidenced
by bonds, debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or businesses;
(iii) every reimbursement obligation of the Company with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account of the
Company; (iv) every obligation of the Company issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business); (v) every
capital lease obligation of the Company; (vi) every obligation of the Company
for claims (as defined in Section 101(4) of the United States Bankruptcy Code of
1978, as amended) in respect of derivative products such as interest and foreign
exchange rate contracts, commodity contracts and similar arrangements; and (vii)
every obligation of the type referred to in clauses (i) through (vi) of another
Person the payment of which, the Company has guaranteed or is responsible or
liable, directly or indirectly, as obligor or otherwise. "Senior Indebtedness"
shall not include (i) any obligations which, by their terms, are expressly
stated to rank pari passu in right of payment with, or to not be superior in
right of payment to, the Junior Subordinated Debentures, (ii) any Senior
Indebtedness 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, (iii) any indebtedness of the
Company to any of its subsidiaries, (iv) indebtedness to any executive officer
or director of the Company, or (v) any indebtedness in respect of debt
securities issued to any trust, or a trustee of such trust, partnership or other
entity affiliated with the Company that is a financing entity of the Company in
connection with the issuance of such financing entity of securities that are
similar to the Capital Securities.
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"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
pursuant to the terms of such Security as the fixed date on which the principal
of such Security or such installment of principal or interest is due and
payable, as such date may, in the case of such principal, be shortened or
extended as provided pursuant to the terms of such Security and this Indenture.
"Subsidiary" means an entity 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 that 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.
"Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.7 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Tax Event" means the receipt by an Issuer 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 or administrative pronouncement or
action 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 Capital Securities of such
Issuer Trust, there is more than an insubstantial risk that (i) such Issuer
Trust is, or will be within 90 days of the delivery 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
Issuer Trust, (ii) interest payable by the Company on such corresponding series
of Securities is not, or within 90 days of the delivery of such Opinion of
Counsel will not be, deductible by the Company, in whole or in part, for United
States Federal income tax purposes, or (iii) such Issuer Trust is, or will be
within 90 days of the delivery of such Opinion of Counsel, subject to more than
a de minimis amount of other taxes, duties or other governmental charges.
"Trust Agreement" means, with respect to any Issuer Trust, the trust
agreement or other governing instrument of such Issuer Trust.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture, solely in its capacity as such and not in its
individual capacity, until a successor Trustee shall have become such pursuant
to the applicable provisions of this Indenture, and thereafter "Trustee" shall
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mean or include each Person who is then a Trustee hereunder and, if at any time
there is more than one such Person, "Trustee" as used with respect to the
Securities of any series shall mean the Trustee with respect to Securities of
that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
modified, amended or supplemented from time to time, except as provided in
Section 9.5.
"Trust Securities" has the meaning specified in the first recital of
this Indenture.
"Vice President," when used with respect to the Company, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
SECTION 1.2. Compliance Certificate and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent
(including covenants compliance with which constitutes a condition 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 (including covenants compliance with
which constitutes a condition precedent), if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than the
certificates provided pursuant to Section 10.4) shall include:
(1) a statement by each individual signing such certificate or opinion
that such individual has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions of such individual contained
in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he or she has
made such examination or investigation as is necessary to enable him or her 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, in the opinion of such individual, such
condition or covenant has been complied with.
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SECTION 1.3. Forms of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate 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, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to matters upon which his or her certificate or opinion is based
are erroneous. Any such certificate or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate 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, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions, or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given to or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments is or are
delivered to the Trustee, and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
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 Indenture and (subject to Section 6.1) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section.
(b) 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 the certificate of any 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 or her the execution thereof.
Where such
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execution is by a Person acting in other than his or her individual capacity,
such certificate or affidavit shall also constitute sufficient proof of his or
her authority.
(c) The fact and date of the execution by any Person of any such
instrument or writing, or the authority of the Person executing the same, may
also be provided in any other manner that the Trustee deems sufficient and in
accordance with such reasonable rules as the Trustee may determine.
(d) The ownership of Securities shall be proved by the Securities
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon the
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.
(f) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next succeeding paragraph.
If any record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date, provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
(as defined below) by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Company from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.2, (iii) any request to institute
proceedings referred to in Section 5.7(2), or (iv) any direction referred to in
Section 5.12, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date, provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of
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Outstanding Securities of such series on such record date. Nothing in this
paragraph shall be construed to prevent the Trustee from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and of no effect) and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company's expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the party
hereto that sets such record date may designate any day as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or later
day, provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 1.6 on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such 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 principal amount.
SECTION 1.5. Notices, Etc. to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder, any holder of Capital Securities or the
Company shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its Corporate Trust
Office, or
(2) the Company by the Trustee, any Holder or any holder of Capital
Securities shall be sufficient for every purpose (except as otherwise provided
in Section 5.1) hereunder if in writing and mailed, first class, postage
prepaid, to the Company addressed to it at the address of its principal office
specified in the first paragraph of this instrument or at any other address
previously furnished in writing to the Trustee by the Company.
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SECTION 1.6. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first class postage prepaid, to each Holder affected
by such event, at the address of such Holder as it appears in the Securities
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. If, by reason of the suspension
of or irregularities in regular mail services or for any other reason, it shall
be impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 1.7. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the provision of the Trust Indenture Act shall control.
If any provision of this Indenture modifies or excludes any provision of the
Trust Indenture Act that may be so modified or excluded, the latter provision
shall be deemed to apply to this Indenture as so modified or to be excluded, as
the case may be.
SECTION 1.8. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.9. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.10. Separability Clause.
If any provision in this Indenture or in the Securities 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.
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SECTION 1.11. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors and
assigns, the holders of Senior Indebtedness, the Holders of the Securities and,
to the extent expressly provided in Sections 5.2, 5.8, 5.9, 5.11, 5.13, 9.1 and
9.2, the holders of Capital Securities, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
SECTION 1.12. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 1.13. Non-Business Days.
If any Interest Payment Date, Redemption Date or Stated Maturity of any
Security shall not be a Business Day, then (notwithstanding any other provision
of this Indenture or the Securities) payment of interest or principal (and
premium, if any) or other amounts in respect of such Security need not be made
on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, until such next succeeding 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 Interest Payment Date or Redemption Date
or at the Stated Maturity).
ARTICLE II
SECURITY FORMS
SECTION 2.1. Forms Generally.
The Securities of each series and the Trustee's certificate of
authentication shall be in substantially the forms set forth in this Article, or
in such other form or forms as shall be established by or pursuant to a Board
Resolution or in one or more 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 and such legends or endorsements placed thereon
as may be required to comply with applicable tax laws or the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, 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 Company
Order contemplated by Section 3.3 with respect to the authentication and
delivery of such Securities.
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The Trustee's certificates of authentication shall be substantially in
the form set forth in this Article.
The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be listed, on a steel engraved border or
steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
Securities distributed to holders of Global Capital Securities (as
defined in the applicable Trust Agreement) upon the dissolution of an Issuer
Trust shall be distributed in the form of one or more Global Securities
registered in the name of a Depositary or its nominee, and deposited with the
Securities Registrar, as custodian for such Depositary, or with such Depositary,
for credit by the Depositary to the respective accounts of the beneficial owners
of the Securities represented thereby (or such other accounts as they may
direct). Securities distributed to holders of Capital Securities other than
Global Capital Securities upon the dissolution of an Issuer Trust shall not be
issued in the form of a Global Security or any other form intended to facilitate
book-entry trading in beneficial interests in such Securities.
SECTION 2.2. Form of Face of Security.
FIRST CITIZENS BANCSHARES, INC.
[Title of Security]
[If the Security is a Restricted Security, insert -- THE SECURITIES
EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (A) BY ANY INITIAL INVESTOR THAT IS NOT A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT,
(I) TO A PERSON WHOM THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (II) IN AN OFFSHORE TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 903
OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (III) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), OR (B) BY AN INITIAL INVESTOR THAT IS A QUALIFIED
INSTITUTIONAL BUYER OR BY ANY SUBSEQUENT INVESTOR, AS SET FORTH IN (A) ABOVE
AND, IN ADDITION, TO AN INSTITUTIONAL ACCREDITED INVESTOR IN A TRANSACTION
EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, AND, IN EACH
CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES AND OTHER
JURISDICTIONS OF THE UNITED STATES. THE HOLDER OF THIS SECURITY AGREES THAT IT
WILL COMPLY WITH THE FOREGOING RESTRICTIONS. SECURITIES OWNED BY AN INITIAL
INVESTOR THAT IS NOT A QUALIFIED INSTITUTIONAL BUYER MAY NOT BE HELD IN GLOBAL
FORM AND
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MAY NOT BE TRANSFERRED WITHOUT CERTIFICATION THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS, AS PROVIDED IN THE INDENTURE REFERRED TO BELOW. NO
REPRESENTATION CAN BE MADE AS TO THE AVAILABILITY OF THE EXEMPTION PROVIDED BY
RULE 144 FOR RESALES OF THE CAPITAL SECURITIES.]
No. $
FIRST CITIZENS BANCSHARES, INC., a Delaware corporation (hereinafter
called the "Company", which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to , or registered assigns, the principal sum of __________ Dollars on , [if the
Security is a Global Security, then insert, if applicable--, or such other
principal amount represented hereby as may be set forth in the records of the
Securities Registrar hereinafter referred to in accordance with the Indenture,]
[; provided that the Company may (i) shorten the Stated Maturity of the
principal of this Security to a date not earlier than , and (ii) extend the
Stated Maturity of the principal of this Security at any time on one or more
occasions, subject to certain conditions specified in Section 3.15 of the
Indenture, but in no event to a date later than ]. The Company further promises
to pay interest on said principal from , or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, [monthly]
[quarterly] [semi-annually] [if applicable, insert--(subject to deferral as set
forth herein)] in arrears on [insert applicable Interest Payment Dates] of each
year, commencing ______________ at the [variable rate equal to [insert
applicable interest rate formula]] [rate of ____%] per annum, [if applicable
insert--together with Additional Sums, if any, as provided in Section 10.6 of
the Indenture,] until the principal hereof is paid or duly provided for or made
available for payment [if applicable, insert--; provided that any overdue
principal, premium or Additional Sums and any overdue installment of interest
shall bear Additional Interest at the [variable rate equal to [insert applicable
interest rate formula]] [rate of ____%] per annum (to the extent that the
payment of such interest shall be legally enforceable), compounded [monthly]
[quarterly] [semi-annually], from the dates such amounts are due until they are
paid or made available for payment, and such interest shall be payable on
demand]. The amount of interest payable for any period less than a full interest
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. The amount of
interest payable for any full interest period shall be computed by dividing the
applicable rate per annum by [twelve/four/two]. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on
the Regular Record Date for such interest installment [if applicable, insert--,
which shall be the [__ or__ ] (whether or not a Business Day), as the case may
be, next preceding such Interest Payment Date]. Any such interest not so
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee (notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record
Date) or be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities of this
series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture.
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[If applicable, insert--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 Security, from time to time to defer the payment of interest on this
Security for up to consecutive [monthly] [quarterly] [semi-annual] interest
payment periods with respect to each deferral period (each an "Extension
Period") [if applicable, insert--, during which Extension Periods the Company
shall have the right to make partial payments of interest on any Interest
Payment Date, and] at the end of which the Company shall pay all interest then
accrued and unpaid including Additional Interest, as provided below; provided,
however, that no Extension Period shall extend beyond the Stated Maturity of the
principal of this Security [If Stated Maturity can be shortened or extended,
insert--, as then in effect,] and no such Extension Period may end on a date
other than an Interest Payment Date; and provided, further, however, that during
any such Extension Period, the Company shall not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company's capital 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 in
all respects with or junior in interest to this Security (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or shareholder stock purchase plan or in connection with the issuance of capital
stock of the Company (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
Subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any Rights Plan, or the
issuance of rights, stock or other property under any Rights Plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu with
or junior to such stock). Prior to the termination of any such Extension Period,
the Company may further defer the payment of interest, provided that no
Extension Period shall exceed consecutive [monthly] [quarterly] [semi-annual]
interest payment periods, extend beyond the Stated Maturity of the principal of
this Security or end on a date other than an Interest Payment Date. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due on any Interest Payment
Date, the Company may elect to begin a new Extension Period, subject to the
above conditions. No interest shall be due and payable during an Extension
Period, except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension Period shall bear
Additional Interest (to the extent that the payment of such interest shall be
legally enforceable) at the [variable rate equal to [insert applicable interest
rate formula]] [rate of ____%] per annum, compounded [monthly] [quarterly]
[semi-annually] and calculated as set forth in the first paragraph of this
Security, from the date on which such amounts would otherwise have been due and
payable until paid or made available for payment. The Company shall give the
Holder of this Security and the Trustee notice of its election to begin any
Extension Period at least one Business Day prior to the next succeeding Interest
Payment Date on which interest on this Security
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would be payable but for such deferral [if applicable, insert--or so long as
such securities are held by [insert name of applicable Issuer Trust], at least
one Business Day prior to the earlier of (i) the next succeeding date on which
Distributions on the Capital Securities of such Issuer Trust would be payable
but for such deferral, and (ii) the date on which the Property Trustee of such
Issuer Trust is required to give notice to holders of such Capital Securities of
the record date or the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.]
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts [if applicable, insert--; provided, however that at the option of
the Company payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register, or (ii) if to a Holder of $1,000,000 or more in aggregate principal
amount of this Security, by wire transfer in immediately available funds upon
written request to the Trustee not later than 15 calendar days prior to the date
on which the interest is payable].
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and subject in right of payments to the prior
payment in full of all Senior Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take
such actions as may be necessary or appropriate to effectuate the subordination
so provided, and (c) appoints the Trustee his or her attorney-in-fact for any
and all such purposes. Each Holder hereof, by his or her acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
FIRST CITIZENS BANCSHARES, INC.
By:___________________________
Name:
Title:
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<PAGE>
Attest:
_______________________
Secretary or Assistant Secretary
SECTION 2.3. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under the Junior Subordinated Indenture, dated as of _______, 1998
(herein called the "Indenture"), between the Company and Bankers Trust Company,
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Indebtedness and the Holders of the Securities,
and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the face hereof [if
applicable, insert--, limited in aggregate principal amount to $_________].
All terms used in this Security that are defined in the Indenture [if
applicable, insert-- or in [insert name of trust agreement], dated as of
__________________ (as modified, amended or supplemented from time to time the
"Trust Agreement"), relating to [insert name of Issuer Trust] [the ("Issuer
Trust") among the Company, as Depositor, the Trustees named therein and the
Holders from time to time of the Trust Securities issued pursuant thereto] shall
have the meanings assigned to them in the Indenture [if applicable, insert--or
the Trust Agreement, or the Registration Rights Agreement, as the case may be].
[If applicable, insert--The Company has the right to redeem this
Security (i) on or after _________, in whole at any time or in part from time to
time, or (ii) in whole (but not in part), at any time within 90 days following
the occurrence and during the continuation of a Tax Event, Investment Company
Event, or Capital Treatment Event, in each case at the Redemption Price
described below, and subject to possible regulatory approval.]
[If applicable, insert--In the case of a redemption on or after
___________, the Redemption Price shall equal the following prices, expressed in
percentages of the principal amount hereof, together with accrued interest to
but excluding the date fixed for redemption, if redeemed during the 12-month
period beginning ___________:
Redemption
Year Price
---- -----
and 100% on or after __________.
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In the case of a redemption on or after __________ following a Tax
Event, Investment Company Event or Capital Treatment Event, the Redemption Price
shall equal the Redemption Price then applicable to a redemption under the
preceding paragraph.
In the case of a redemption prior to _________ following a Tax Event,
Investment Company Event or Capital Treatment Event in respect of the Issuer
Trust, the Redemption Price shall equal the Make-Whole Amount for a
corresponding $_________ principal amount hereof, together with accrued interest
to but excluding the date fixed for redemption, which Make-Whole Amount will be
equal to the greater of (i) 100% of the principal amount hereof, and (ii) as
determined by a Quotation Agent (as defined in the Trust Agreement), the sum of
the present values of the principal amount hereof and premium, if any, payable
as part of the Redemption Price with respect to an optional redemption hereof on
___________, together with the present values of scheduled payments of interest
(not including the portion of any such payments of interest accrued as of the
Redemption Date) from the date fixed for redemption to ___________, in each case
discounted to the date fixed for redemption on a [monthly] [quarterly]
[semi-annual] basis (assuming a 360-day year consisting of 30-day months) at the
Adjusted Treasury Rate (as defined in the Trust Agreement).]
[If the Security is subject to redemption of any kind, insert--In the
event of redemption of this Security in part only, a new Security or Securities
of this series for the unredeemed portion hereof will be issued in the name of
the Holder hereof upon the cancellation hereof.]
[If applicable, insert--Pursuant to the Registration Rights Agreement,
in the event that: (i) (A) neither the Exchange Offer Registration Statement nor
a Shelf Registration Statement is filed with the Commission on or prior to the
150th day after the Issue Date or (B) notwithstanding that the Company and the
Issuer Trust have consummated or will consummate an Exchange Offer, the Company
and the Issuer Trust are required to file a Shelf Registration Statement and
such Shelf Registration Statement is not filed on or prior to the date required
by the Registration Rights Agreement, then commencing on the day after the
applicable required filing date, liquidated damages shall accrue on the
principal amount of the Junior Subordinated Debentures and, if the Exchange
Offer has been consummated, the New Junior Subordinated Debentures, each at a
rate of ____% per annum; or (ii) (A) neither the Exchange Offer Registration
Statement nor a Shelf Registration Statement is declared effective by the
Commission on or prior to the _______ day after the Issue Date or (B)
notwithstanding that the Company and the Issuer Trust have consummated or will
consummate an Exchange Offer, the Company and the Issuer Trust are required to
file a Shelf Registration Statement and such Shelf Registration Statement is not
declared effective by the Commission on or prior to the _____ day after the date
such Shelf Registration Statement was required to be filed, then, commencing on
the _____ day after the Issue Date, liquidated damages shall accrue on the
principal amount of the Junior Subordinated Debentures and, if the Exchange
Offer has been consummated, the New Junior Subordinated Debentures, each at a
rate of ____% per annum; or (iii) (A) the Issuer Trust has not exchanged New
Capital Securities for all Capital Securities validly tendered for exchange by
their respective Holders or the Company has not exchanged the New Guarantee or
New Junior Subordinated Debentures for the Guarantee or Junior Subordinated
Debentures validly tendered, in accordance with the terms of the Exchange Offer
on or prior to the _____ day after the date on which the Exchange Offer
Registration Statement was declared effective or (B) if applicable, the Shelf
Registration Statement has been declared effective and such Shelf Registration
Statement ceases to be effective at any time prior to the expiration of the
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Rule 144(K) Period (other than after such time as all Capital Securities have
been disposed of thereunder or otherwise cease to be Registrable Securities),
then liquidated damages shall accrue on the principal amount of the Junior
Subordinated Debentures and, if the Exchange Offer has been consummated, the New
Junior Subordinated Debentures, each at a rate of ____% per annum commencing on
(x) the ____ day after such effective date, in the case of (A) above, or (y) the
day such Shelf Registration Statement ceases to be effective in the case of B
above; provided, however, that the liquidated damages on the Junior Subordinated
Debentures and, if the Exchange Offer has been consummated, the New Junior
Subordinated Debentures, may not exceed in the aggregate ____% per annum;
provided, further, however, that (1) upon the filing of the Exchange Offer
Registration Statement or a Shelf Registration Statement (in the case of clause
(i) above), (2) upon the effectiveness of the Exchange Offer Registration
Statement or a Shelf Registration Statement (in the case of clause (ii) above),
or (3) upon the exchange of New Capital Securities, the New Guarantee and New
Junior Subordinated Debentures for all Capital Securities, the Guarantee and all
Junior Subordinated Debentures tendered (in the case of clause (iii)(A) above),
or upon the effectiveness of the Shelf Registration Statement which had ceased
to remain effective (in the case of clause (iii)(B) above) liquidated damages on
the Junior Subordinated Debentures and, if the Exchange Offer has been
consummated, the New Junior Subordinated Debentures, shall cease to accrue and
accumulate.
Any amounts of liquidated damages due pursuant to the preceding
paragraph, will be payable in cash on the next succeeding Interest Payment Date
to Holders on the relevant Regular Record Date.]
[If applicable, insert--The Indenture contains provisions for
defeasance at any time [of the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance by the Company with certain
conditions set forth in the Indenture.]
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of the Company and of the Holders of the Securities, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of each series to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
[If the Security is not a Discount Security, insert--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare the principal amount of all the Securities of this series to
be due and payable immediately,
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by a notice in writing to the Company (and to the Trustee if given by Holders)
[if applicable, insert--, provided that, if upon an Event of Default, the
Trustee or such Holders fail to declare the principal of all the Outstanding
Securities of this series to be immediately due and payable, the Holders of at
least 25% in aggregate Liquidation Amount of the Capital Securities then
outstanding shall have the right to make such declaration 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 Interest) on all
the Securities of this series shall become immediately due and payable, provided
that the payment of principal and interest (including any Additional Interest)
on such Securities shall remain subordinated to the extent provided in Article
XIII of the Indenture.]
[If the Security is a Discount Security, insert--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Outstanding Securities of this
series may declare an amount of principal of the Securities of this series to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders) [if applicable, insert--, provided that, if upon an
Event of Default, the Trustee or such Holders fail to declare such principal
amount of the Outstanding Securities of this series to be immediately due and
payable, the Holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then outstanding shall have the right to make such
declaration by a notice in writing to the Company and the Trustee. The principal
amount payable upon such acceleration shall be equal to--insert formula for
determining the amount]. Upon any such declaration, such amount of the principal
of and the accrued interest (including any Additional Interest) on all the
Securities of this series shall become immediately due and payable, provided
that the payment of such principal and interest (including any Additional
Interest) on all the Securities of this series shall remain subordinated to the
extent provided in Article XIII of the Indenture. Upon payment (i) of the amount
of principal so declared due and payable and (ii) of interest on any overdue
principal, premium and interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and premium and interest, if any, on
this Security shall terminate.]
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Additional Interest) on this Security at the times, place
and 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 Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained under Section 10.2 of the Indenture
for such purpose, duly endorsed by, 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 such Holder's attorney duly authorized in
writing, and thereupon one or more new Securities of this series, of like tenor,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
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The Securities of this series are issuable only in registered form
without coupons in denominations of $100,000 and any integral multiple of $1,000
in excess thereof. Securities or portions thereof may be transferred or
exchanged only in principal amounts of not less than $100,000. Any transfer,
exchange or other disposition of Securities in contravention of Section
3.6(b)(v) of the Indenture shall be deemed to be void and of no legal effect
whatsoever, any such transferee shall be deemed not to be the Holder or owner of
any beneficial interest in such Securities for any purpose, including but not
limited to the receipt of interest payable on such Securities, and such
transferee shall be deemed to have no interest whatsoever in such Securities. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agrees that for United States Federal, state and
local tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
THIS SECURITY IS A DIRECT AND UNSECURED OBLIGATION OF THE COMPANY, DOES
NOT EVIDENCE DEPOSITS AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER INSURER OR GOVERNMENT AGENCY.
SECTION 2.4. Additional Provisions Required in Global Security.
Unless otherwise specified as contemplated by Section 3.1, any Global
Security issued hereunder shall, in addition to the provisions contained in
Sections 2.2 and 2.3, bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING
OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS
SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME
OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY
NOT
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BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY, EXCEPT IN
THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
SECTION 2.5. Form of Trustee's Certificate of Authentication.
The Trustee's certificates 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.
Dated:____________________ BANKERS TRUST COMPANY,
as Trustee
By: ____________________________
Authorized Signatory
ARTICLE III
THE SECURITIES
SECTION 3.1. Title and Terms.
The aggregate principal amount of Securities that may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 3.3,
set forth or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities as a series:
(a) the title of the securities of such series, which shall distinguish
the Securities of the series from all other Securities;
(b) the limit, if any, upon the aggregate principal amount of the
Securities of such series that may be authenticated and delivered under this
Indenture (except for Securities authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 3.4, 3.5, 3.6, 9.6 or 11.6 and except for any
Securities that, pursuant to Section 3.3, are deemed never to have been
authenticated and delivered hereunder); provided, however, that the authorized
aggregate principal amount of such series may be increased above such amount by
a Board Resolution to such effect;
(c) the Person to whom any interest on a Security of the series shall
be payable, if other than the Person in whose name that security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest;
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(d) the Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination thereof, and
any dates on which or circumstances under which, the Company shall have the
right to extend or shorten such Stated Maturity or Maturities;
(e) the rate or rates, if any, at which the Securities of such series
shall bear interest, if any, the rate or rates and extent to which Additional
Interest, if any, shall be payable with respect to any Securities of such
series, the date or dates from which any such interest or Additional Interest
shall accrue, the Interest Payment Dates on which such interest shall be
payable, the right, pursuant to Section 3.12 or as otherwise set forth therein,
of the Company to defer or extend an Interest Payment Date, and the Regular
Record Date for the interest payable on any Interest Payment Date or the method
by which any of the foregoing shall be determined;
(f) the place or places where the principal of (and premium, if any)
and interest or Additional Interest on the Securities of such series shall be
payable, the place or places where the Securities of such series may be
presented for registration of transfer or exchange, any restrictions that may be
applicable to any such transfer or exchange in addition to or in lieu of those
set forth herein and the place or places where notices and demands to or upon
the Company in respect of the Securities of such series may be made;
(g) the period or periods within or the date or dates on which, if any,
the price or prices at which and the terms and conditions upon which the
Securities of such series may be redeemed, in whole or in part, at the option of
the Company, and if other than by a Board Resolution, the manner in which any
election by the Company to redeem such Securities shall be evidenced;
(h) the obligation or the right, if any, of the Company to redeem,
repay or purchase the Securities of such series pursuant to any sinking fund,
amortization or analogous provisions, or at the option of a Holder thereof, and
the period or periods within which, the price or prices at which, the currency
or currencies (including currency unit or units) in which and the other terms
and conditions upon which Securities of the series shall be redeemed, repaid or
purchased, in whole or in part, pursuant to such obligation;
(i) the denominations in which any Securities of such series shall be
issuable, if other than denominations of $1,000 and any integral multiple
thereof;
(j) if other than Dollars, the currency or currencies (including any
currency unit or units) in which the principal of (and premium, if any) and
interest and Additional Interest, if any, on the Securities of the series shall
be payable, or in which the Securities of the series shall be denominated and
the manner of determining the equivalent thereof in Dollars for purposes of the
definition of Outstanding;
(k) the additions, modifications or deletions, if any, in the Events of
Default or covenants of the Company set forth herein with respect to the
Securities of such series;
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(l) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;
(m) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more dates
prior to the Stated Maturity, the amount which shall be deemed to be the
principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or which shall
be deemed to be Outstanding as of any date prior to the Stated Maturity (or, in
any such case, the manner in which such amount deemed to be the principal amount
shall be determined);
(n) if applicable, that the Securities of the series, in whole or in
any specified part, shall be defeasible and, if other than by a Board
Resolution, the manner in which any election by the Company to defease such
Securities shall be evidenced;
(o) the additions or changes, if any, to this Indenture with respect to
the Securities of such series as shall be necessary to permit or facilitate the
issuance of the Securities of such series in bearer form, registrable or not
registrable as to principal, and with or without interest coupons;
(p) any index or indices used to determine the amount of payments of
principal of and premium, if any, on the Securities of such series or the manner
in which such amounts will be determined;
(q) if applicable, that any Securities of the series shall be issuable
in whole or in part in the form of one or more Global Securities and, in such
case, the respective Depositaries for such Global Securities, the form of any
legend or legends that shall be borne by any such Global Security in addition to
or in lieu of that set forth in Section 2.4 and any circumstances in addition to
or in lieu of those set forth in Section 3.5 in which any such Global Security
may be exchanged in whole or in part for Securities registered, and any transfer
of such Global Security in whole or in part may be registered, in the name or
names of Persons other than the Depositary for such Global Security or a nominee
thereof;
(r) the appointment of any Paying Agent or agents for the Securities of
such series;
(s) the terms of any right to convert or exchange Securities of such
series into any other securities or property of the Company, and the additions
or changes, if any, to this Indenture with respect to the Securities of such
series to permit or facilitate such conversion or exchange;
(t) if such Securities are to be issued to an Issuer Trust, the form or
forms of the Trust Agreement and Guarantee relating thereto;
(u) if other than as set forth herein, the relative degree, if any, to
which the Securities or the series shall be senior to or be subordinated to
other series of Securities in right of payment, whether such other series of
Securities are Outstanding or not;
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(v) any addition to or change in the Events of Default which applies to
any Securities of the series and any change in the right of the Trustee or the
requisite Holders of such Securities to declare the principal amount thereof due
and payable pursuant to Section 5.2;
(w) any addition to or change in the covenants set forth in Article X
which applies to Securities of the series; and
(x) any other terms of the Securities of such series (which terms shall
not be inconsistent with the provisions of this Indenture, except as permitted
by Section 9.1()).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided herein or in
or pursuant to such Board Resolution and set forth, or determined in the manner
provided, in such Officers' Certificate or in any indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, 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 setting forth the terms of the series.
The securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article XIII.
SECTION 3.2. Denominations.
The Securities of each series shall be in registered form without
coupons and shall be issuable in minimum denominations of $100,000 and any
integral multiples of $1,000 in excess thereof, unless otherwise specified as
contemplated by Section 3.1(i).
SECTION 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board of Directors, its Vice Chairman of the Board of Directors,
its President or one of its Vice Presidents, under its corporate seal reproduced
or impressed thereon and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities. 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, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities. If the form or terms of
the Securities of the series have been established by or pursuant to one or more
Board Resolutions as permitted by
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Sections 2.1 and 3.1, 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 6.1) shall be
fully protected in relying upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been
established by or pursuant to Board Resolution as permitted by Section
2.1, that such form has been established in conformity with the
provisions of this Indenture;
(2) if the terms of such Securities have been
established by or pursuant to Board Resolution as permitted by Section
3.1, that such terms have been established in conformity with the
provisions of this Indenture; and
(3) 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 valid and legally binding obligations of the Company
enforceable in accordance with their 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.
If such form or terms have been so established, 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 that
is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 3.1 and the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 3.1 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by the manual signature of one of its authorized
officers or signatories, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. Notwithstanding the foregoing, if any
Security shall have been authenticated and delivered hereunder but never issued
and sold by the Company, and the Company shall deliver such Security to the
Trustee for cancellation as provided in Section 3.10, for all purposes of this
Indenture such Security shall be deemed never to have been authenticated and
delivered hereunder and shall never be entitled to the benefits of this
Indenture.
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SECTION 3.4. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon receipt of a Company Order the Trustee shall
authenticate and deliver, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities of such series in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of such series to be prepared without unreasonable
delay. After the preparation of definitive Securities, the temporary Securities
shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor one or more definitive securities
of the same series, of any authorized denominations having the same Original
Issue Date and Stated Maturity and having the same terms as such temporary
Securities. 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.
SECTION 3.5. Global Securities.
(a) Each Global Security issued under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary advises the Trustee in writing that such
Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Company is unable to locate a qualified successor, (ii) the Company executes and
delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary, or (iii) there shall
have occurred and be continuing an Event of Default.
(c) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Securities Registrar for exchange or cancellation as provided
in this Article III. If any Global Security is to be exchanged for other
Securities or cancelled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, then either
(i) such Global Security shall be so surrendered for exchange or cancellation as
provided in this Article III or (ii) the principal amount thereof shall be
reduced, subject to Section 3.6(b)(v), or increased by an amount equal to the
portion thereof to be so exchanged or cancelled, or equal to the principal
amount of such other Security to
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be so exchanged for a beneficial interest therein, as the case may be, by means
of an appropriate adjustment made on the records of the Securities Registrar,
whereupon the Trustee, in accordance with the Applicable Procedures, shall
instruct the Depositary or its authorized representative to make a corresponding
adjustment to its records. Upon any such surrender or adjustment of a Global
Security by the Depositary, accompanied by registration instructions, the
Trustee shall, subject to Section 3.6(b) and as otherwise provided in this
Article III, authenticate and deliver any Securities issuable in exchange for
such Global Security (or any portion thereof) in accordance with the
instructions of the Depositary. The Trustee shall not be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be fully
protected in relying on, such instructions.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article III, Section 9.6 or 11.6 or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as the registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security shall be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or agent. Neither the
Trustee nor the Securities Registrar shall have any liability in respect of any
transfers effected by the Depositary.
(f) The rights of owners of beneficial interests in a Global Security
shall be exercised only through the Depositary and shall be limited to those
established by law and agreements between such owners and the Depositary and/or
its Agent Members.
SECTION 3.6. Registration, Transfer and Exchange Generally; Certain
Transfers and Exchanges; Securities Act Legends.
(a) The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register in which, subject to such reasonable regulations as it
may prescribe, the Company shall provide for the registration of Securities and
transfers of Securities. Such register is herein sometimes referred to as the
"Securities Register." The Trustee is hereby appointed "Securities Registrar"
for the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the
offices or agencies of the Company designated for that purpose, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Securities of the same
series of any authorized denominations of like tenor and aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series in any authorized denominations, of like tenor and
aggregate principal amount and bearing
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such restrictive legends as may be required by this Indenture, upon surrender of
the Securities to be exchanged at such office or agency. Whenever any securities
are so surrendered for exchange, the Company shall execute, and the Trustee
shall authenticate and deliver, the Securities that the Holder making the
exchange is entitled to receive.
All Securities issued upon any transfer or exchange of Securities shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities Registrar, duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange 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 connection
with any transfer or exchange of Securities.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (i) to issue, register the transfer of or exchange
any Security of any series during a period beginning at the opening of business
15 days before the day of selection for redemption of Securities of that series
pursuant to Article XI and ending at the close of business on the day of mailing
of the notice of redemption, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of
any such Security to be redeemed in part, any portion thereof not to be
redeemed.
(b) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture, transfers and exchanges of Securities and
beneficial interests in a Global Security shall be made only in accordance with
this Section 3.6(b).
(i) Restricted Non-Global Security to Global
Security. If the Holder of a Restricted Security (other than a Global
Security) wishes at any time to transfer all or any portion of such
Security to a Person who wishes to take delivery thereof in the form of
a beneficial interest in a Global Security, such transfer may be
effected only in accordance with the provisions of this clause (b)(i)
and subject to the Applicable Procedures. Upon receipt by the
Securities Registrar of (A) such Security as provided in Section 3.6(a)
and instructions satisfactory to the Securities Registrar directing
that a beneficial interest in the Global Security in a specified
principal amount not greater than the principal amount of such Security
be credited to a specified Agent Member's account and (B) a Restricted
Securities Certificate duly executed by such Holder or such Holder's
attorney duly authorized in writing, then the Securities Registrar
shall cancel such Security (and issue a new Security in respect of any
untransferred portion thereof) as provided in Section 3.10 and increase
the aggregate principal amount of the Global Security by the specified
principal amount as provided in Section 3.5(c).
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(ii) Non-Global Security to Non-Global Security. A
Security that is not a Global Security may be transferred, in whole or
in part, to a Person who takes delivery in the form of another Security
that is not a Global Security as provided in Section 3.6(a), provided
that if the Security to be transferred in whole or in part is a
Restricted Security, the Securities Registrar shall have received a
Restricted Securities Certificate duly executed by the transferor
Holder or such Holder's attorney duly authorized in writing.
(iii) Exchanges Between Global Security and
Non-Global Security. A beneficial interest in a Global Security may be
exchanged for a Security that is not a Global Security as provided in
Section 3.5.
(iv) Certain Initial Transfers of Non-Global
Securities. In the case of Securities initially issued other than in
global form, an initial transfer or exchange of such Securities that
does not involve any change in beneficial ownership may be made to an
Institutional Accredited Investor or Investors as if such transfer or
exchange were not an initial transfer or exchange; provided that
written certification shall be provided by the transferee and
transferor of such Securities to the Securities Registrar that such
transfer or exchange does not involve a change in beneficial ownership.
(v) Limitations Relating to Principal Amount.
Notwithstanding any other provision of this Indenture and unless
otherwise specified as permitted by Section 3.1; Securities or portions
thereof may be transferred or exchanged only in principal amounts of
not less than $100,000. Any transfer, exchange or other disposition of
Securities in contravention of this Section 3.6(b)(v) shall be deemed
to be void and of no legal effect whatsoever, any such transferee shall
be deemed not to be the Holder or owner of any beneficial interest in
such Securities for any purpose, including but not limited to the
receipt of interest payable on such Securities, and such transferee
shall be deemed to have no interest whatsoever in such Securities.
(c) Restricted Securities Legend. Except as set forth below, all
Securities shall bear a Restricted Securities Legend:
(i) subject to the following clauses of this Section
3.6(c), a Security or any portion thereof that is exchanged, upon
transfer or otherwise, for a Global Security or any portion thereof
shall bear the Restricted Securities Legend while represented thereby;
(ii) subject to the following clauses of this Section
3.6(c), a new Security which is not a Global Security and is issued in
exchange for another Security (including a Global Security) or any
portion thereof, upon transfer or otherwise, shall, if such new
Security is required pursuant to Section 3.6(b)(ii) or (iii) to be
issued in the form of a Restricted Security, bear a Restricted
Securities Legend;
(iii) a new Security (other than a Global Security)
that does not bear a Restricted Securities Legend may be issued in
exchange for or in lieu of a Restricted Security or any portion thereof
that bears such a legend if, in the Company's judgment, placing such a
legend
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upon such new Security is not necessary to ensure compliance with the
registration requirements of the Securities Act, and the Trustee, at the written
direction of the Company in the form of an Officers' Certificate, shall
authenticate and deliver such a new Security as provided in this Article III;
(iv) notwithstanding the foregoing provisions of this
Section 3.6(c), a Successor Security of a Security that does not bear a
Restricted Securities Legend shall not bear such form of legend unless
the Company has reasonable cause to believe that such Successor
Security is a "restricted security" within the meaning of Rule 144, in
which case the Trustee, at the written direction of the Company in the
form of an Officers' Certificate, shall authenticate and deliver a new
Security bearing a Restricted Securities Legend in exchange for such
Successor Security as provided in this Article III; and
(v) Securities distributed to a holder of Capital
Securities upon dissolution of an Issuer Trust shall bear a Restricted
Securities Legend if the Capital Securities so held bear a similar
legend.
SECTION 3.7. Mutilated, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee together with
such security or indemnity as may be required by the Company or the Trustee to
save each of them harmless, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same series,
of like tenor and aggregate principal amount, bearing the same legends, and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security, and (ii) such security or indemnity as may be required by them to save
each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its request the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series, of like tenor and aggregate principal amount and bearing the
same legends as such destroyed, lost or stolen Security, and bearing a number
not contemporaneously Outstanding.
If any such mutilated, destroyed, lost or stolen Security has become or
is about to become due and payable, the Company in its discretion may, instead
of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section 3.7, 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
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or
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not the destroyed, lost or stolen Security shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of such series duly issued
hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.8. Payment of Interest and Additional Interest; Interest
Rights Preserved.
Interest and Additional Interest on any Security of any series that is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date, shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest in respect of Securities of such series, except
that, unless otherwise provided in the Securities of such series, interest
payable on the Stated Maturity of the principal of a Security shall be paid to
the Person to whom principal is paid. The initial payment of interest on any
Security of any series that is issued between a Regular Record Date and the
related Interest Payment Date shall be payable as provided in such Security or
in the Board Resolution pursuant to Section 3.1 with respect to the related
series of Securities.
Any interest on any Security that is due and payable, but is not timely
paid or duly provided for, on any Interest Payment Date for Securities of such
series (herein called "Defaulted Interest"), shall forthwith cease to be payable
to the registered Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securities of such
series in respect of which interest is in default (or their respective
Predecessor Securities) are registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Security and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.
Thereupon, the Trustee shall fix a Special Record Date for the payment
of such Defaulted Interest, which shall be not more than 15 days and
not less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be mailed, first class, postage
prepaid, to each Holder of a Security of such series at the address of
such Holder as it appears in the Securities Register not less than 10
days prior to such Special
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Record Date. The Trustee may, in its discretion, in the name and at the
expense of the Company, cause a similar notice to be published at least
once in a newspaper, customarily published in the English language on
each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, New York, but such publication shall
not be a condition precedent to the establishment of such Special
Record Date. Notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor having been mailed as aforesaid,
such Defaulted Interest shall be paid to the Persons in whose names the
Securities of such series (or their respective Predecessor Securities)
are registered on such Special Record Date and shall no longer be
payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of the
series in respect of which interest is in default may be listed and,
upon such notice as may be required by such exchange (or by the Trustee
if the Securities are not listed), if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause
(2), such payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security delivered
under this Indenture upon transfer of or in exchange for or in lieu of any other
Security shall carry the rights to interest accrued and unpaid, and to accrue
interest, that were carried by such other Security.
SECTION 3.9. Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
shall treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and (subject
to Section 3.8) any interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary shall have any rights under this Indenture with respect
to such Global Security, and such Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the 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
such holders of beneficial interests, the operation of customary practices
governing the exercise of the rights of the Depositary (or its nominee) as
Holder of any Security.
SECTION 3.10. Cancellation.
All Securities surrendered for payment, redemption, transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee, and any such Securities and Securities surrendered
directly to the Trustee for any such purpose shall be promptly canceled by it.
The Company may at any time deliver to the Trustee for cancellation any
Securities previously
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authenticated and delivered hereunder that the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly canceled by
the Trustee. No Securities shall be authenticated in lieu of or in exchange for
any Securities canceled as provided in this Section, except as expressly
permitted by this Indenture. All canceled Securities shall be destroyed by the
Trustee and the Trustee shall deliver to the Company a certificate of such
destruction.
SECTION 3.11. Computation of Interest.
Except as otherwise specified as contemplated by Section 3.1 for
Securities of any series, interest on the Securities of each series for any
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual number of days elapsed in any partial month in such period, and
interest on the Securities of each series for a full period shall be computed by
dividing the rate per annum by the number of interest periods that together
constitute a full twelve months.
SECTION 3.12. Deferrals of Interest Payment Dates.
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If specified as contemplated by Section 2.1 or Section 3.1 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 (each an "Extension Period") not to
exceed the number of consecutive quarterly, semi-annual or other periods that
equal five years with respect to each Extension Period, during which Extension
Periods the Company shall, if so specified as contemplated by Section 3.1, 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 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; and provided further, however, that, during any such Extension Period,
the Company shall not (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Company's capital 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 in all respects with or junior in
interest to the Securities of such series (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
shareholder stock purchase plan or in connection with the issuance of capital
stock of the Company (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
Subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
(d) any declaration of a dividend in connection with any Rights Plan, or the
issuance of rights, stock or other property under any Rights Plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu with
or junior to such stock). Prior to that termination of any such Extension
Period, the Company may further defer the payment of interest, provided that no
Event of Default has occurred and is continuing and provided further, that no
Extension Period shall exceed the period or periods specified in such
Securities, extend beyond the Stated Maturity of the principal of such
Securities or end on a date other than an Interest Payment Date. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due on any Interest Payment
Date, the Company may elect to begin a new Extension Period, subject to the
above conditions. No interest or Additional Interest shall be due and payable
during an Extension Period, except at the end thereof, but each installment of
interest that would otherwise have been due and payable during such Extension
Period shall bear Additional Interest as and to the extent as may be specified
as contemplated by Section 3.1. The Company shall give the Holders of the
Securities of such series and the Trustee notice of its election to begin any
such Extension Period at least one
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Business Day 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 any Securities of a series issued to an Issuer Trust, so long as
any such Securities are held by such Issuer Trust, at least one Business Day
prior to the earlier of (i) the next succeeding date on which Distributions on
the Capital Securities of such Issuer Trust would be payable but for such
deferral, and (ii) the date on which the Property Trustee of such Issuer Trust
is required to give notice to holders of such Capital Securities of the record
date or the date such Distributions are payable, but in any event not less than
one Business Day prior to such record date.
The 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.
SECTION 3.13. Right of Set-Off.
With respect to the Securities of a series initially issued to an
Issuer Trust, notwithstanding anything to the contrary herein, the Company shall
have the right to set off any payment it is otherwise required to make 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
Guarantee relating to such Security or to a holder of Capital Securities
pursuant to an action undertaken under Section 5.8 of this Indenture.
SECTION 3.14. 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 constitutes indebtedness.
SECTION 3.15. Shortening or Extension of Stated Maturity.
If specified as contemplated by Section 2.1 or Section 3.1 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 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, 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 clause (ii) above, at the time such election is made and at the time
of extension, such conditions as may be specified in such Securities shall have
been satisfied.
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SECTION 3.16. CUSIP Numbers.
The Company, in issuing the Securities, may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notice of redemption and other similar or related materials as a convenience to
Holders; provided that any such notice or other materials may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of redemption or other materials
and that reliance may be placed only on the other identification numbers printed
on the Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall, upon Company Request, cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for and as otherwise provided
in this Section 4.1) and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities that have been destroyed,
lost or stolen and that have been replaced or paid as provided
in Section 3.7 and (ii) Securities for whose payment money has
theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 10.3) have
been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their
Stated Maturity within one year of the date of
deposit, or
(iii) are to be called for redemption within
one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of subclause (B)(i), (ii) or (iii) above,
has deposited or caused to be deposited with the Trustee as trust funds
in trust for such purpose an amount in the currency or currencies in
which the Securities of such series are payable sufficient to pay and
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discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for the principal (and
premium, if any) and interest (including any Additional Interest) to
the date of such deposit (in the case of Securities that have become
due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided relating to the satisfaction and discharge of
this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the
obligations of the Trustee to any Authenticating Agent under Section
6.14 and, if money shall have been deposited with the Trustee pursuant
to subclause (B) of clause (1) of this Section, the obligations of the
Trustee under Section 4.2 and the last paragraph of Section 10.3 shall
survive.
Notwithstanding the foregoing, in any case where the Securities are not due and
payable and have not been called for redemption, such Securities shall remain
recourse obligations of the Company.
SECTION 4.2 Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all
money deposited with the Trustee pursuant to Section 4.1 shall be held in trust
and applied by the Trustee, in accordance with the provisions of the Securities
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest and Additional Interest for the payment of which such money or
obligations have been deposited with or received by the Trustee.
ARTICLE V
REMEDIES
SECTION 5.1. Events of Default.
"Event of Default", wherever used herein with respect to the Securities
of any series, 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):
(1) default in the payment of any interest upon any Security
of that series, including any Additional Interest in respect thereof,
when it becomes 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 any Extension Period); or
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(2) default in the payment of the principal of (or premium, if
any, on) any Security of that series at its Maturity; or
(3) failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part of the
Company in the Securities of that series or in this Indenture for a
period of 90 days after the date on which written notice of such
failure, requiring the Company to remedy the same, shall have been
given to the Company by the Trustee by registered or certified mail or
to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of that
series; or
(4) entry by a court having jurisdiction in the premises of
(A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company
under any applicable federal or state law, at appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of substantially all of the property of the
Company, or ordering the winding-up or liquidation of its affairs, and
the continuance of any such decree of order for relief or any such
other decree or order unstayed and in effect for a period of 90
consecutive days; or
(5) (A) the commencement by the Company of a voluntary case or
proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or (B) the
consent by the Company or the entry of a decree of order for relief in
respect of itself in an involuntary case or proceeding under any
applicable federal or state bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against the Company, or (C) the filing by
the Company of a petition or answer or consent seeking reorganization
or relief under any applicable federal or state law or (D) the consent
by the Company to the filing of such petition or to the appointment of
or taking possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of
all or substantially all of the property of the Company, or (E) the
making by the Company of an assignment for the benefit of creditors; or
(6) any other Event of Default provided with respect to
Securities of that series.
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SECTION 5.2. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(4) or 5.1(5)) with respect to Securities of any series at the time
Outstanding occurs and is continuing, then, and in every such case, the Trustee
or the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities of that series may declare the principal amount (or, if
the Securities of that series are Discount Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
Securities of that series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), provided that,
in the case of the Securities of a series issued to an Issuer 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 such series fail to declare the
principal of all the Outstanding Securities of such series to be immediately due
and payable, the holders of at least 25% in aggregate Liquidation Amount of the
related series of Capital Securities issued by such Issuer Trust then
outstanding shall have the right to make such declaration by a notice in writing
to the Company and the Trustee; and upon any such declaration such principal
amount (or specified portion thereof) of and the accrued interest (including any
Additional Interest) on all the Securities of such series shall become
immediately due and payable. If an Event of Default specified in Section 5.1(4)
or 5.1(5) with respect to Securities of any series at the time Outstanding
occurs, the principal amount of all the Securities of such series (or, if the
Securities of such series are Discount Securities, such portion of the principal
amount of such Securities as may be specified by the terms of that series) shall
automatically, and without any declaration or other action on the part of the
Trustee or any Holder, become immediately due and payable. Payment of principal
and interest (including any Additional Interest) on such Securities shall remain
subordinated to the extent provided in Article XIII notwithstanding that such
amount shall become immediately due and payable as herein provided.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(A) all overdue installments of interest on all
Securities of such series;
(B) any accrued Additional Interest on all Securities
of such series;
(C) the principal of (and premium, if any, on) any
Securities of such series that have become due otherwise than
by such declaration of acceleration and interest and
Additional Interest thereon at the rate borne by the
Securities; and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel; and
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(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities of
that series that has become due solely by such acceleration, have been
cured or waived as provided in Section 5.13.
In the case of Securities of a series initially issued to an Issuer
Trust, if the Holders of such Securities fail to annul such declaration and
waive such default, the holders of a majority in aggregate Liquidation Amount of
the related series of Capital Securities issued by such Issuer Trust then
outstanding shall also have the right to rescind and annul such declaration and
its consequences by written notice to the Company and the Trustee, subject to
the satisfaction of the conditions set forth in clauses (1) and (2) above of
this section 5.2.
No such rescission shall affect any subsequent default or Event of Default or
impair any right consequent thereon.
SECTION 5.3. Collection of Indebtedness and Suits for Enforcement
by Trustee.
The Company covenants that if:
(1) default is made in the payment of any installment of
interest (including any Additional Interest) on any Security of any
series when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (and
premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to the Trustee, for
the benefit of the Holders of such Securities, the whole amount then
due and payable on such Securities for principal (and premium, if any)
and interest (including any Additional Interest), and, in addition
thereto, all amounts owing the Trustee under Section 6.7.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Securities and collect the
monies adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default with respect to Securities of any series occurs
and is continuing, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of Securities of such series by
such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
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SECTION 5.4. Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial or
administrative proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors,
(a) the Trustee (irrespective of whether the principal of the
Securities of any 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 on the Company for the payment of overdue principal (and
premium, if any) or interest (including any Additional Interest)) shall be
entitled and empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of principal
(and premium, if any) and interest (including any Additional Interest)
owing and unpaid in respect to the Securities and to file such other
papers or documents as may be necessary or advisable and to take any
and all actions as are authorized under the Trust Indenture Act in
order to have the claims of the Holders and any predecessor to the
Trustee under Section 6.7 allowed in any such judicial or
administrative proceedings; and
(ii) in particular, the Trustee shall be authorized to collect and
receive any monies or other property payable or deliverable on any such
claims and to distribute the same in accordance with Section 5.6; and
(b) any custodian, receiver, assignee, trustee, liquidator,
sequestrator, conservator (or other similar official) in any such judicial or
administrative proceeding is hereby authorized by each Holder to make such
payments to the Trustee for distribution in accordance with Section 5.6, 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 and any predecessor
Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
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SECTION 5.5. Trustee May Enforce Claim Without Possession of
Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, subject to
Article XIII and after provision for the payment of all the amounts owing the
Trustee and any predecessor Trustee under Section 6.7, its agents and counsel,
be for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
SECTION 5.6 Application of Money Collected.
Any money or property collected or to be applied by the Trustee with
respect to a series of Securities pursuant to this Article shall be applied in
the following order, at the date or dates fixed by the Trustee and, in case of
the distribution of such money or property on account of principal (or premium,
if any) or interest (including any Additional Interest), upon presentation of
the Securities and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any
predecessor Trustee under Section 6.7;
SECOND: Subject to Article XIII, to the payment of the amounts then due
and unpaid upon Securities of such series for principal (and premium, if any)
and interest (including any Additional Interest) in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such series of
Securities for principal (and premium, if any) and interest (including any
Additional Interest), respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
SECTION 5.7 Limitation on Suits.
Subject to Section 5.8, no Holder of any Securities of any series shall
have any right to institute any proceeding, judicial or otherwise, with respect
to this Indenture or for the appointment of a receiver, assignee, trustee,
liquidator, sequestrator (or other similar official) or for any other remedy
hereunder, unless:
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities
of that series;
(2) the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities of that series shall have made
written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
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(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a
majority in aggregate principal amount of the Outstanding Securities of
that series;
it being understood and intended that no one or more of such Holders
shall have any right in any manner whatever by virtue of, or by
availing itself of, any provision of this Indenture to affect, disturb
or prejudice the rights of any other Holders of Securities, or to
obtain or to seek to obtain priority or preference over any other of
such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all
such Holders.
SECTION 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders of
Capital Securities.
Notwithstanding any other provision in this Indenture, the Holder of
any Security of any series shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Sections 3.8 and 3.12) interest (including any Additional Interest)
on such Security on the respective Stated Maturities expressed in such Security
(or in the case of redemption, on the Redemption Date) and to institute suit for
the enforcement of any such payment, and such right shall not be impaired
without the consent of such Holder. In the case of Securities of a series issued
to an Issuer Trust, any registered holder of the series of Capital Securities
issued by such Issuer Trust shall have the right, upon the occurrence of an
Event of Default described in Section 5.1(1) or 5.1(2), to institute a suit
directly against the Company for enforcement of payment to such holder of
principal of (premium, if any) and (subject to Sections 3.8 and 3.12) interest
(including any Additional Interest) on the Securities having a principal amount
equal to the aggregate Liquidation Amount of such Capital Securities held by
such holder.
SECTION 5.9. Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Capital Securities issued
by any Issuer Trust has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to the Trustee, such Holder or such
holder of Capital Securities, then, and in every such case, the Company, the
Trustee, such Holders and such holder of Capital Securities shall, subject to
any determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee, such Holder and such holder of Capital Securities shall continue as
though no such proceeding had been instituted.
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SECTION 5.10. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 3.7, no
right or remedy herein conferred upon or reserved to the Trustee or the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee, any Holder of any Security with
respect to the Securities of the related series or any holder of any Capital
Security to exercise any right or remedy accruing upon any Event of Default with
respect to the Securities of the related series shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein.
Every right and remedy given by this Article or by law to the Trustee
or to the Holders and the right and remedy given to the holders of Capital
Securities by Section 5.8 may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee, the Holders or the holders of Capital
Securities, as the case may be.
SECTION 5.12. Control by Holders.
The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of any series 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 the Securities of such series, provided that:
(1) such direction shall not be in conflict with any rule
of law or with this Indenture;
(2) the Trustee may take any other action deemed proper
by the Trustee that is not inconsistent with such direction; and
(3) subject to the provisions of Section 6.1, the Trustee
shall have the right to decline to follow such direction if a
Responsible Officer or Officers of the Trustee shall, in good faith,
determine that the proceeding so directed would be unjustly prejudicial
to the Holders not joining in any such direction or would involve the
Trustee in personal liability.
SECTION 5.13. Waiver of Past Defaults.
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The Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of any series affected thereby and, in the case of
any Securities of a series initially issued to an Issuer Trust, the holders of a
majority in aggregate Liquidation Amount of the Capital Securities issued by
such Issuer Trust may waive any past default hereunder and its consequences with
respect to such series except a default:
(1) in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security of such
series (unless such default has been cured and the Company has paid to
or deposited with the Trustee a sum sufficient to pay all matured
installments of interest (including Additional Interest) and all
principal of (and premium, if any, on) all Securities of that series
due otherwise than by acceleration); or
(2) in respect of a covenant or provision hereof that under
Article IX cannot be modified or amended without the consent of each
Holder of any Outstanding Security of such series affected.
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 waiver by holders of Capital
Securities issued by such Issuer Trust, by all holders of Capital Securities
issued by such Issuer Trust.
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 Event of Default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may, in
its discretion, require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may, in its
discretion, assess reasonable costs, including reasonable attorneys' fees,
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, or group of Holders, holding in
the aggregate more than 10% in aggregate principal amount of the Outstanding
Securities of any series, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
(including any Additional Interest) on any Security on or after the respective
Stated Maturities expressed in such Security.
SECTION 5.15. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force, which may
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affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
ARTICLE VI
THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties 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 its part, the 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 Trustee and conforming to the requirements of
this Indenture, but in the case of any such certificates or opinions
that by any provisions 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) In case an Event of Default has occurred and is continuing, 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 person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct except that
(1) this subsection shall not be construed to limit the
effect of subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts; and
(3) 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 Holders pursuant to Section 5.12 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 with respect to the Securities of a
series.
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(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) 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.
SECTION 6.2. Notice of Defaults.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Securities
Register, notice of such default, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security 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
interests of the Holders of Securities of such series; and provided further,
that, in the case of any default of the character specified in Section 5.1(3),
no such notice to Holders of Securities of such series shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section, the
term "default" means any event that is, or after notice or lapse of time or both
would become, an Event of Default with respect to Securities of such series.
SECTION 6.3. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(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, direction, consent, order, bond, debenture, Security 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 or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
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(d) the Trustee may consult with counsel and the 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 reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction;
(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, direction, consent, order, bond, indenture,
Security or other paper or document, but the Trustee in its discretion may make
such inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such inquiry or investigation, it shall
be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(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.
SECTION 6.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.
SECTION 6.5. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.8 and 6.13, may otherwise deal with the Company with the same rights it would
have if it were not Trustee, Authenticating Agent, Paying Agent, Securities
Registrar or such other agent.
SECTION 6.6. Money Held in Trust.
Money held by the Trustee in trust hereunder 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 money received by it hereunder except as
otherwise agreed with the Company.
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SECTION 6.7. Compensation and Reimbursement.
(a) The Company agrees to pay to the Trustee from time to time
reasonable compensation for all services rendered by it hereunder in such
amounts as the Company and the Trustee shall agree from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust).
(b) The Company agrees to reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture (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.
(c) Since the Issuer Trust is being formed solely to facilitate an
investment in the Trust Securities, the Company, as Holder of the Common
Securities, hereby covenants to pay all debts and obligations (other than with
respect to the Capital Securities and the Common Securities) and all reasonable
costs and expenses of the Issuer Trust (including without limitation all
reasonable costs and expenses relating to the organization of the Issuer Trust,
the fees and expenses of the trustees and all costs and expenses relating to the
operation of the Issuer Trust) and to pay any and all taxes, duties, assessments
or governmental charges of whatever nature (other than withholding taxes)
imposed on the Issuer Trust by the United States, or any taxing authority, so
that the net amounts received and retained by the Issuer Trust and the Property
Trustee after paying such expenses will be equal to the amounts the Issuer Trust
and the Property Trustee would have received had no such costs or expenses been
incurred by or imposed on the Issuer Trust. 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 (each, a
"Creditor") whether or not such Creditor has received notice thereof. Any such
Creditor may enforce such obligations directly against the Company, and the
Company irrevocably waives any right or remedy to require that any such Creditor
take any action against the Issuer Trust or any other person before proceeding
against the Company. The Company shall execute such additional agreements as may
be necessary or desirable to give full effect to the foregoing.
(d) The Company shall indemnify the Trustee for, and hold it harmless
against, any loss, liability or expense (including the reasonable compensation
and the expenses and disbursements of its agents and counsel) incurred without
negligence or bad faith, arising out of or in connection with the acceptance or
administration of this trust or the performance of its duties hereunder,
including the reasonable 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. This indemnification shall survive the termination
of this Indenture or the resignation or removal of the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(4) or 5.1(5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under the Bankruptcy Reform Act of 1978 or any successor statute.
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SECTION 6.8. Disqualification; Conflicting Interests.
The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act. Nothing
herein shall prevent the Trustee from filing with the Commission the application
referred to in the second to last paragraph of said Section 310(b).
SECTION 6.9. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be:
(a) an entity organized and doing business under the laws of the United
States of America or of any state or territory thereof or of the District of
Columbia, authorized under such laws to exercise corporate trust powers and
subject to supervision or examination by Federal, state, territorial or District
of Columbia authority; or
(b) an entity or other Person organized and doing business under the
laws of a foreign government that is permitted to act as Trustee pursuant to a
rule, regulation or order of the Commission, authorized under such laws to
exercise corporate trust powers, and subject to supervision or examination by
authority of such foreign government or a political subdivision thereof
substantially equivalent to supervision or examination applicable to United
States institutional trustees;
in either case having a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by Federal or state authority. If such
entity 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 entity
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 the Trustee 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. Neither the Company nor any Person directly or indirectly
controlling, controlled by or under common control with the Company shall serve
as Trustee for the Securities of any series issued hereunder.
SECTION 6.10. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the Securities
of one or more series by giving written notice thereof to the Company. If an
instrument of acceptance by a successor Trustee shall not have been delivered to
the Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
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(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of such series, delivered to the
Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after
written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months; or
(2) the Trustee shall cease to be eligible under Section 6.9
and shall fail to resign after written request therefor by the Company
or by any such Holder; 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, (i) the Company, acting pursuant to the authority of a
Board Resolution, may remove the Trustee with respect to the Securities of all
series issued hereunder, or (ii) subject to Section 5.14, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
such Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to the Securities of
all series issued hereunder and the appointment of a successor Trustee or
Trustees.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause with
respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee with respect to the
Securities of that or those series. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of such series delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee with respect to the Securities of such
series and supersede the successor Trustee appointed by the Company. If no
successor Trustee with respect to the Securities of any series shall have been
so appointed by the Company or the Holders and accepted appointment in the
manner hereinafter provided, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, subject to Section 5.14, on
behalf of such Holder and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.
(f) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities of such series as their names and addresses appear in the
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Securities Register. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.
SECTION 6.11. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(b) 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
one or more 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 that
or those 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 that or those 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 or 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 removal of the retiring
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 that or those 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 that or those series to which the appointment
of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all rights, powers and trusts referred to
in paragraph (a) or (b) of this Section, as the case may be.
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(d) No successor Trustee shall accept its appointment unless, at the
time of such acceptance, such successor Trustee shall be qualified and eligible
under this Article.
SECTION 6.12. Merger, Conversion, Consolidation or Succession to
Business.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such entity
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. In case any Securities shall have been authenticated, but not
delivered, by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Securities so authenticated, and in case any Securities shall not
have been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor Trustee or in the name of such
successor Trustee, and in all cases the certificate of authentication shall have
the full force which it is provided anywhere in the Securities or in this
Indenture that the certificate of the Trustee shall have.
SECTION 6.13. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
SECTION 6.14. Appointment of Authenticating Agent.
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The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities, which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 3.6, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be an entity organized and doing business under
the laws of the United States of America, or of any state or territory thereof
or of the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or state
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section the combined capital
and surplus of such Authenticating Agent 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, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any entity into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any entity resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any entity succeeding to all or substantially all of the corporate
trust business of an Authenticating Agent shall be the successor Authenticating
Agent hereunder, provided such entity shall be 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.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof 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 such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent, which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 1.6 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance 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. No successor
Authenticating Agent shall be appointed unless eligible under the provision of
this Section.
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payment, subject to the
provisions of Section 6.7.
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If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities referred to in the within mentioned
Indenture.
Dated: __________________ BANKERS TRUST COMPANY,
as Trustee
By: ____________________________
As Authenticating Agent
Name:
Title:
By: ____________________________
As Authenticating Agent
Name:
Title:
ARTICLE VII
HOLDER'S LISTS AND REPORTS BY TRUSTEE,
PAYING AGENT AND COMPANY
SECTION 7.1. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after February 15
and August 15 in each year, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Holders as of such date; and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days prior to the
time such list is furnished, excluding from any such list names and addresses
received by the Trustee in its capacity as Securities Registrar.
SECTION 7.2. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.1 and the names
and addresses of Holders received by the Trustee in its capacity as
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Securities Registrar. The Trustee may destroy any list furnished to it as
provided in Section 7.1 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided in the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of information as to the names and addresses of the Holders made
pursuant to the Trust Indenture Act.
SECTION 7.3. Reports by Trustee and Paying Agent.
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act, at the times and in the manner provided pursuant thereto.
(b) Reports so required to be transmitted at stated intervals of not
more than 12 months shall be transmitted no later than January 31 in each
calendar year, commencing with the first January 31 after the first issuance of
Securities under this Indenture.
(c) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each securities exchange upon which any
Securities are listed and also with the Commission. The Company will notify the
Trustee when any Securities are listed on any securities exchange.
(d) The Paying Agent shall comply with all withholding, backup
withholding, tax and information reporting requirements under the Internal
Revenue Code of 1986, as amended, and the Treasury Regulations issued thereunder
with respect to payments on, or with respect to, the Securities.
SECTION 7.4. Reports by Company.
The Company shall file or cause to be filed with the Trustee and with
the Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided in the Trust Indenture
Act. In the case of information, documents or reports required to be filed with
the Commission pursuant to Section 13(a) or Section 15(d) of the Exchange Act,
the Company shall file or cause the filing of such information documents or
reports with the Trustee within 15 days after the same are required to be filed
with the Commission.
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ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 8.1. Company May Consolidate, Etc., Only on Certain Terms.
The Company 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
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) If the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the entity formed by such
consolidation or into which the Company is merged or the Person that
acquires by conveyance or transfer, or that leases, the properties and
assets of the Company substantially as an entirety shall be an entity
organized and existing under the laws of the United States of America
or any state thereof or the District of Columbia and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of (and premium, if any), and interest
(including any Additional Interest) on all the Securities of every
series and the performance of every covenant of this Indenture on the
part of the Company to be performed or observed; provided, however,
that nothing herein shall be deemed to restrict or prohibit, and no
supplemental indenture shall be required in the case of, the merger of
a Principal Subsidiary Bank with and into a Principal Subsidiary Bank
or the Company, the consolidation of Principal Subsidiary Banks into a
Principal Subsidiary Bank or the Company, or the sale or other
disposition of all or substantially all of the assets of any Principal
Subsidiary Bank to another Principal Subsidiary Bank or the Company,
if, in any such case in which the surviving, resulting or acquiring
entity is not the Company, the Company would own, directly or
indirectly, at least 80% of the voting securities of the Principal
Subsidiary Bank (and of any other Principal Subsidiary Bank any voting
securities of which are owned, directly or indirectly, by such
Principal Subsidiary Bank) surviving such merger, resulting from such
consolidation or acquiring such assets;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event that, after notice or lapse of time, or
both, would constitute an Event of Default, shall have occurred and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and any such
supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been
complied with and, in the case of a transaction subject to this Section
8.1 but not requiring a supplemental indenture under paragraph (1) of
this Section 8.1, an Officer's Certificate or Opinion of Counsel to the
effect that the surviving, resulting or successor entity is legally
bound by the Indenture and the Securities; and the Trustee, subject to
Section 6.1, may rely upon such Officers'
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Certificates and Opinions of Counsel as conclusive evidence that such
transaction complies with this Section 8.1.
SECTION 8.2. Successor Company Substituted.
Upon any consolidation or merger by the Company with or into any other
Person, or any conveyance, transfer or lease by the Company of its properties
and assets substantially as an entirety to any Person in accordance with Section
8.1, the successor entity formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein; and in the event of any such conveyance,
transfer or lease the Company shall be discharged from all obligations and
covenants under the Indenture and the Securities.
Such successor Person may cause to be executed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder that theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Securities that previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication pursuant to such
provisions and any Securities that such successor Person thereafter shall cause
to be executed and delivered to the Trustee on its behalf for the purpose
pursuant to such provisions. 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.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form may be made in the Securities thereafter to
be issued as may be appropriate.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may amend
or waive any provision of this Indenture or may enter into one or more
indentures supplemental hereto, in form satisfactory to the Trustee, for any of
the following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Securities contained; or
(2) to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee or to surrender any right or power
herein conferred upon the Company; or
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(3) to establish the form or terms of Securities of any series
as permitted by Sections 2.1 or 3.1; or
(4) to facilitate the issuance of Securities of any series in
certificated or other definitive form; or
(5) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of the series specified) or to surrender any right or power
herein conferred upon the Company; or
(6) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such additional
Events of Defaults are to be for the benefit of less than all series of
Securities, stating that such additional Events of Default are
expressly being included solely for the benefit of the series
specified); or
(7) to change or eliminate any of the provisions of this
Indenture, provided that any such change or elimination shall (a)
become effective only when there is no Security Outstanding of any
series created prior to the execution of such supplemental indenture
that is entitled to the benefit of such provision or (b) not apply to
any Outstanding Securities; or
(8) to cure any ambiguity, to correct or supplement any
provision herein that may be defective or inconsistent with any other
provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture, provided that such
action pursuant to this clause (8) 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 an
Issuer Trust and for so long as any of the corresponding series of
Capital Securities issued by such Issuer Trust shall remain
outstanding, the holders of such Capital Securities; or
(9) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to 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,
pursuant to the requirements of Section 6.11(b); or
(10) to comply with the requirements of the Commission in
order to effect or maintain the qualification of this Indenture under
the Trust Indenture Act.
SECTION 9.2. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series affected
by such supplemental indenture, by Act of said Holders delivered to the Company
and the Trustee, the Company, when authorized by a Board
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Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities of such series
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Security of each
series affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest (including any Additional Interest) on, any
Security, or reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the redemption thereof, or
reduce the amount of principal of a Discount Security that would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 5.2, or change the place of payment where, or the
coin or currency in which, any Security or interest thereon is payable,
or impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or
(2) reduce the percentage in aggregate principal amount of the
Outstanding Securities of any series, the consent of whose Holders is
required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 5.13
or Section 10.5, 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;
provided, further, that, in the case of the Securities of a series
issued to an Issuer Trust, so long as any of the corresponding series
of Capital Securities issued by such Issuer Trust remains outstanding,
(i) no such amendment shall be made that adversely affects the holders
of such Capital Securities in any material respect, and no termination
of this Indenture shall occur, and no waiver of any Event of Default or
compliance with any covenant under this Indenture shall be effective,
without the prior consent of the holders of at least a majority of the
aggregate Liquidation Amount of such Capital Securities then
outstanding unless and until the principal of (and premium, if any, on)
the Securities of such series and all accrued and (subject to Section
3.8) unpaid interest (including any Additional Interest) thereon have
been paid in full, and (ii) no amendment shall be made to Section 5.8
of this Indenture that would impair the rights of the holders of
Capital Securities issued by an Issuer Trust provided therein without
the prior consent of the holders of each such Capital Security then
outstanding unless and until the principal of (and premium, if any, on)
the Securities of such series and all accrued and (subject to Section
3.8) unpaid interest (including any Additional Interest) thereon have
been paid in full.
A supplemental indenture that changes or eliminates any covenant or
other provision of this Indenture that has expressly been included solely for
the benefit of one or more particular series of
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Securities or any corresponding series of Capital Securities of an Issuer Trust
that holds the Securities of any series, or that modifies the rights of the
Holders of Securities of such series or holders of such Capital Securities of
such corresponding 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 of any other series or holders of Capital Securities of any other
such corresponding series.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 9.3. Execution of Supplemental Indentures.
In executing or accepting the additional trusts created by any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.1) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and
that all conditions precedent herein provided for relating to such action have
been complied with. The Trustee may, but shall not be obligated to, enter into
any such supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 9.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 9.5. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 9.6. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Company, bear a notation in form approved by the Company as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series.
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ARTICLE X
COVENANTS
SECTION 10.1. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest (including any Additional Interest) on the Securities of
that series in accordance with the terms of such Securities and this Indenture.
SECTION 10.2. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities of that series and this Indenture
may be served. The Company initially appoints the Trustee, acting through its
Corporate Trust Office, as its agent for said purposes. The Company will give
prompt written notice to the Trustee of any change in the location of any such
office or agency. If at any time the Company shall fail to maintain such office
or agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all of such purposes, and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Securities of any series for such purposes. The Company
will give prompt written notice to the Trustee of any such designation and any
change in the location of any such office or agency.
SECTION 10.3. Money for Security Payments to be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest (including Additional Interest)
on any of the Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
(and premium, if any) or interest (including Additional Interest) so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and will promptly notify the Trustee of its failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
(or premium, if any) or interest, including Additional Interest on any
Securities, deposit with a Paying Agent a sum sufficient to pay the
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principal (and premium, if any) or interest, including Additional Interest so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal (and premium, if any) or interest, including
Additional Interest, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest (including Additional Interest) on the Securities
of a series in trust for the benefit of the Persons entitled thereto until such
sums shall be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any other
obligor upon such Securities) in the making of any payment of principal (and
premium, if any) or interest (or Additional Interest) in respect of any Security
of any Series;
(3) at any time during the continuance of any default with respect to a
series of Securities, upon the written request of the Trustee, forthwith pay to
the Trustee all sums so held in trust by such Paying Agent with respect to such
series; and
(4) comply with the provisions of the Trust Indenture Act applicable to
it as a Paying Agent.
The Company may, at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same terms as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company in trust for the payment of the principal of (and premium, if
any) or interest (including Additional Interest) on any Security and remaining
unclaimed for two years after such principal (and premium, if any) or interest
(including Additional Interest) has become due and payable shall (unless
otherwise required by mandatory provision of applicable escheat or abandoned or
unclaimed property law) be paid on Company Request to the Company, or (if then
held by the Company) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
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, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, the City of New York, notice that such
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money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 10.4. Statement as to Compliance.
The Company shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate covering the preceding calendar year, stating whether or not to the
best knowledge of the signers thereof the Company is in default in the
performance, observance or fulfillment of or compliance with any of the terms,
provisions, covenants and conditions of this Indenture, and if the Company shall
be in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge. For the purpose of this Section 10.4, compliance
shall be determined without regard to any grace period or requirement of notice
provided pursuant to the terms of this Indenture.
SECTION 10.5. Waiver of Certain Covenants.
Subject to the rights of holders of Capital Securities specified in
Section 9.2, if any, the Company may omit in any particular instance to comply
with any covenant or condition provided pursuant to Section 3.1 with respect to
the Securities of any series, if before or after the time for such compliance
the Holders of at least a majority in aggregate principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
covenant or condition, 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 in respect of any
such covenant or condition shall remain in full force and effect.
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SECTION 10.6. Additional Sums.
In the case of the Securities of a series initially issued to an Issuer
Trust, so long as no Event of Default has occurred and is continuing and except
as otherwise specified as contemplated by Section 2.1 or Section 3.1, if (i) an
Issuer Trust is the Holder of all of the Outstanding Securities of such series,
and (ii) a Tax Event has occurred and is continuing in respect of such Issuer
Trust, the Company shall pay to such Issuer Trust (and its permitted successors
or assigns under the related Trust Agreement) for so long as such Issuer Trust
(or its permitted successor or assignee) is the registered holder of the
Outstanding Securities of such series, such additional sums as may be necessary
in order that the amount of Distributions (including any Additional Amounts (as
defined in such Trust Agreement)) then due and payable by such Issuer Trust on
the related Capital Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of such 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 3.12 on the
Securities shall not defer the payment of any Additional Sums that may be due
and payable.
SECTION 10.7. Additional Covenants.
The Company covenants and agrees with each Holder of Securities of each
series that it shall not (x) 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, or (y) 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 in all respects with or junior in
interest to the Securities of such series (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants, in connection with a dividend reinvestment or
shareholder stock purchase plan or in connection with the issuance of capital
stock of the Company (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period or other event referred to below, (b) as a
result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a Subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) the purchase of fractional interests in shares of the Company's capital
stock pursuant to the conversion or exchange provisions of such capital stock or
the security being converted or exchanged, (d) any declaration of a dividend in
connection with any Rights Plan, or the issuance of rights, stock or other
property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which
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the dividend is being paid or ranks pari passu with or junior to such stock) if
at such time (i) there shall have occurred any event (A) of which the Company
has actual knowledge that with the giving of notice or the lapse of time, or
both, would constitute an Event of Default with respect to the Securities of
such series, and (B) which the Company shall not have taken reasonable steps to
cure, (ii) if the Securities of such series are held by an Issuer Trust, the
Company shall be in default with respect to its payment of any obligations under
the Guarantee relating to the Capital Securities issued by such Issuer Trust, or
(iii) the Company shall have given notice of its election to begin an Extension
Period with respect to the Securities of such series as provided herein and
shall not have rescinded such notice, or such Extension Period, or any extension
thereof, shall be continuing.
The Company also covenants with each Holder of Securities of a series
issued to an Issuer Trust (i) to hold, directly or indirectly, 100% of the
Common Securities of such Issuer Trust, provided that any permitted successor of
the Company as provided under Section 8.2 may succeed to the Company's ownership
of such Common Securities, (ii) as holder of such Common Securities, not to
voluntarily terminate, windup or liquidate such Issuer Trust, other than (a) in
connection with a distribution of the Securities of such series to the holders
of the related Capital Securities in liquidation of such Issuer 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 Issuer
Trust to continue to be taxable as a grantor trust for United States Federal
income tax purposes.
SECTION 10.8. Furnishing Annual Information.
On or before December 15 of each year during which any Securities are
outstanding, the Company shall furnish to each Paying Agent such information as
may be reasonably requested by each Paying Agent in order that each Paying Agent
may prepare the information which it is required to report for such year on
Internal Revenue Service Forms 1096 and 1099 pursuant to Section 6049 of the
Internal Revenue Code of 1986, as amended. Such information shall include the
amount of original issue discount includable in income for each authorized
minimum denomination of principal amount at Stated Maturity of outstanding
Securities during such year.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 11.1. Applicability of This Article.
Redemption of Securities of any series as permitted or required by any
form of Security issued pursuant to this Indenture shall be made in accordance
with such form of Security and this Article; provided, however, that, if any
provision of any such form of Security shall conflict with any provision of this
Article, the provision of such form of Security shall govern. Except as
otherwise set forth in the form of Security for such series, each Security of a
series shall be subject to partial redemption only in the amount of $100,000 or
any integral multiples of $1,000 in excess thereof.
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SECTION 11.2. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced
by or pursuant to a Board Resolution. In case of any redemption at the election
of the Company, the Company shall, not less than 30 nor more than 60 days prior
to the Redemption Date (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee and, in the case of Securities of a series held by
an Issuer Trust, the Property Trustee under the related Trust Agreement, of such
date and of the principal amount of Securities of the applicable series to be
redeemed and provide the additional information required to be included in the
notice or notices contemplated by Section 11.4; provided that, in the case of
any series of Securities initially issued to an Issuer Trust, for so long as
such Securities are held by such Issuer Trust, such notice shall be given not
less than 45 nor more than 75 days prior to such Redemption Date (unless a
shorter notice shall be satisfactory to the Property Trustee under the related
Trust Agreement). 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, the Company shall furnish the Trustee with an Officers' Certificate
and an Opinion of Counsel evidencing compliance with such restriction.
SECTION 11.3. Selection of Securities to be Redeemed.
If less than all the Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security.
The Trustee shall promptly notify the Company in writing of the
Securities selected for partial redemption and the principal amount thereof to
be redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.
SECTION 11.4. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not later than the thirtieth day, and not earlier than the
sixtieth day, prior to the Redemption Date, to each Holder of Securities to be
redeemed, at the address of such Holder as it appears in the Securities
Register.
With respect to Securities of such series to be redeemed, each notice
of redemption shall state:
(a) the Redemption Date;
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(b) the Redemption Price or, if the Redemption Price cannot be
calculated prior to the time the notice is required to be sent, the estimate of
the Redemption Price provided pursuant to the Indenture together with a
statement that it is an estimate and that the actual Redemption Price will be
calculated on the third Business Day prior to the Redemption Date (if such an
estimate of the Redemption Price is given, a subsequent notice shall be given as
set forth above setting forth the Redemption Price promptly following the
calculation thereof);
(c) if less than all Outstanding Securities of such particular series
are to be redeemed, the identification (and, in the case of partial redemption,
the respective principal amounts) of the particular Securities to be redeemed;
(d) that, on the Redemption Date, the Redemption Price will become due
and payable upon each such Security or portion thereof, and that interest
thereon, if any, shall cease to accrue on and after said date;
(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price;
(f) such other provisions as may be required in respect of the terms of
a particular series of Securities; and
(g) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall be irrevocable.
The notice, if mailed in the manner provided above, shall be conclusively
presumed to have been duly given, whether or not the Holder receives such
notice. In any case, a failure to give such notice by mail or any defect in the
notice to the Holder of any Security designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Security.
SECTION 11.5. Deposit of Redemption Price.
Prior to 10:00 a.m., New York City time, on the Redemption Date
specified in the notice of redemption given as provided in Section 11.4, the
Company will deposit with the Trustee or with one or more Paying Agents (or if
the Company is acting as its own Paying Agent, the Company will segregate and
hold in trust as provided in Section 10.3) an amount of money sufficient to pay
the Redemption Price of, and any accrued interest (including Additional
Interest) on, all the Securities (or portions thereof) that are to be redeemed
on that date.
SECTION 11.6. Payment of Securities Called for Redemption.
If any notice of redemption has been given as provided in Section 11.4,
the Securities or portion of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
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presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Company at the applicable Redemption Price, together
with accrued interest (including any Additional Interest) to the Redemption
Date; provided, however, that, unless otherwise specified as contemplated by
Section 3.1, installments of interest (including Additional Interest) whose
Stated Maturity is on or prior to the Redemption Date will be payable to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant record dates according to their
terms and the provisions of Section 3.8.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities of the same
series, of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original
Issue Date, Stated Maturity and terms.
If any Security called for redemption shall not be so paid under
surrender thereof for redemption, the principal of and premium, if any, on such
Security shall, until paid, bear interest from the Redemption Date at the rate
prescribed therefor in the Security.
SECTION 11.7. Right of Redemption of Securities Initially Issued to an
Issuer Trust.
In the case of the Securities of a series initially issued to an Issuer
Trust, except as otherwise specified as contemplated by Section 3.1, the
Company, at its option, may redeem such Securities (i) on or after the date
specified in such Security, in whole at any time or in part from time to time,
or (ii) upon the occurrence and during the continuation of a Tax Event, an
Investment Company Event or a Capital Treatment Event, at any time within 90
days following the occurrence and during the continuation of such Tax Event,
Investment Company Event or Capital Treatment Event, in whole (but not in part),
in each case at a Redemption Price specified in such Security, together with
accrued interest (including Additional Interest) to the Redemption Date.
If less than all the Securities of any such series are to be redeemed,
the aggregate principal amount of such Securities remaining Outstanding after
giving effect to such redemption shall be sufficient to satisfy any provisions
of the Trust Agreement related to the Issuer Trust to which such Securities were
issued.
ARTICLE XII
SINKING FUNDS
Except as may be provided in any supplemental or amended indenture, no
sinking fund shall be established or maintained for the retirement of Securities
of any series.
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ARTICLE XIII
SUBORDINATION OF SECURITIES
SECTION 13.1. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on
each and all of the Securities of each and every series are hereby expressly
made subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness.
SECTION 13.2. No Payment When Senior Indebtedness in Default; Payment
Over of Proceeds Upon Dissolution, Etc.
If the Company shall default in the payment of any principal of (or
premium, if any) or interest on any Senior Indebtedness when the same becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration of acceleration or otherwise, then, upon written notice of such
default to the Company by the holders of Senior Indebtedness or any trustee
therefor, unless and until such default shall have been cured or waived or shall
have ceased to exist, no direct or indirect payment (in cash, property,
securities, by set-off or otherwise) shall be made or agreed to be made on
account of the principal of (or premium, if any) or interest (including
Additional Interest) on any of the Securities, or in respect of any redemption,
repayment, retirement, purchase or other acquisition of any of the Securities.
In the event of (i) any insolvency, bankruptcy, receivership,
liquidation, reorganization, readjustment, composition or other similar
proceeding relating to the Company, its creditors or its property, (ii) any
proceeding for the liquidation, dissolution or other winding-up of the Company,
voluntary or involuntary, whether or not involving insolvency or bankruptcy
proceedings, (iii) any assignment by the Company for the benefit of creditors or
(iv) any other marshalling of the assets of the Company (each such event, if
any, herein sometimes referred to as a "Proceeding"), all Senior Indebtedness
(including any interest thereon accruing after the commencement of any such
proceedings) shall first be paid in full before any payment or distribution,
whether in cash, securities or other property, shall be made to any Holder of
any of the Securities on account thereof. Any payment or distribution, whether
in cash, securities or other property (other than securities of the Company or
any other entity provided for by a plan of reorganization or readjustment, the
payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the
Securities, to the payment of all Senior Indebtedness at the time outstanding
and to any securities issued in respect thereof under any such plan of
reorganization or readjustment), which would otherwise (but for these
subordination provisions) be payable or deliverable in respect of the Securities
of any series shall be paid or delivered directly to the holders of Senior
Indebtedness in accordance with the priorities then existing among such holders
until all Senior Indebtedness (including any interest thereon accruing after the
commencement of any Proceeding) shall have been paid in full.
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In the event of any Proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness, the Holders of the Securities, 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 premium, if any) and interest on the Securities and such other obligations
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 and such other obligations. If,
notwithstanding the foregoing, any payment or distribution of any character or
any security, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior
Indebtedness at the time outstanding and to any securities issued in respect
thereof under any plan of reorganization or readjustment), shall be received by
the Trustee or any Holder in contravention of any of the terms hereof and before
all Senior Indebtedness shall have been paid in full, such payment or
distribution or security shall be received in trust for the benefit of, and
shall be paid over or delivered and transferred to, the holders of the Senior
Indebtedness at the time outstanding in accordance with the priorities then
existing among such holders for application to the payment of all Senior
Indebtedness remaining unpaid, to the extent necessary to pay all such Senior
Indebtedness in full. In the event of the failure of the Trustee or any Holder
to endorse or assign any such payment, distribution or security, each holder of
Senior Indebtedness is hereby irrevocably authorized to endorse or assign the
same.
The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of Senior
Indebtedness or consent to the filing of a financing statement with respect
hereto) as may, in the opinion of counsel designated by the holders of a
majority in principal amount of the Senior Indebtedness at the time outstanding,
be necessary or appropriate to assure the effectiveness of the subordination
effected by these provisions.
The provisions of this Section 13.2 shall not impair any rights,
interests, remedies or powers of any secured creditor of the Company in respect
of any security interest the creation of which is not prohibited by the
provisions of this Indenture.
The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities or ranking junior to the Securities shall not be
deemed to prevent such obligations from constituting, respectively, obligations
ranking on a parity with the Securities or ranking junior to the Securities.
SECTION 13.3. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent (a) the Company, at any time, except during
the pendency of the conditions described in the first paragraph of Section 13.2
or of any Proceeding referred to in Section 13.2, from making payments at any
time of principal of (and premium, if any) or interest (including Additional
Interest) on the Securities, or (b) the application by the Trustee of any monies
deposited with it hereunder to the payment of or on account of the principal of
(and premium, if any) or interest (including any
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Additional Interest) on the Securities or the retention of such payment by the
Holders, if, at the time of such application by the Trustee, it did not have
knowledge that such payment would have been prohibited by the provisions of this
Article.
SECTION 13.4. Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all amounts due or to become due on
all Senior Indebtedness, or the provision for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, the Holders of the Securities shall be subrogated to the extent of
the payments or distributions made to the holders of such Senior Indebtedness
pursuant to the provisions of this Article (equally and ratably with the holders
of all indebtedness of the Company that by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to the Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to holders
of such Senior Indebtedness) to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium if any) and interest (including Additional Interest) on the Securities
shall be paid in full. For purposes of such subrogation, no payments or
distributions to the holders of the Senior Indebtedness of any cash, property or
securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Indebtedness
by Holders of the Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment or distribution by the Company to or on
account of the Senior Indebtedness.
SECTION 13.5. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Securities is
intended to or shall: (a) impair, as between the Company and the Holders of the
Securities, the obligations of the Company, which are absolute and
unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any) and interest (including any Additional Interest) on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other than their rights
in relation to the holders of Senior Indebtedness; or (c) prevent the Trustee or
the Holder of any Security (or to the extent expressly provided herein, the
holder of any Capital Security) from exercising all remedies otherwise permitted
by applicable law upon default under this Indenture, including filing and voting
claims in any Proceeding, subject to the rights, if any, under this Article of
the holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.
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SECTION 13.6. Trustee to Effectuate Subordination.
Each Holder of a Security by his or her acceptance thereof authorizes
and directs the Trustee on his or her behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination provided
in this Article and appoints the Trustee his or her attorney-in-fact for any and
all such purposes.
SECTION 13.7. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Indebtedness 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 that any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities of any series, without incurring responsibility to such Holders of
the Securities and without impairing or releasing the subordination provided in
this Article or the obligations hereunder of such Holders of the Securities to
the holders of Senior Indebtedness, do any one or more of the following: (i)
change the manner, place or terms of payment or extent the time of payment of,
or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iii) release any Person liable in any manner for
the collection of Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
SECTION 13.8. Notice to Trustee.
The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in
respect of the Securities, unless and until the Trustee shall have received
written notice thereof from the Company or a holder of Senior Indebtedness or
from any trustee, agent or representative therefor; provided, however, that if
the Trustee shall not have received the notice provided for in this Section at
least two Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, the payment of the
principal of (and premium, if any, on) or interest (including any Additional
Interest) on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
monies and to apply the same to the purpose for which they were received and
shall not be affected by any notice to the contrary that may be received by it
within two Business Days prior to such date.
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Subject to the provisions of Section 6.1, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself or herself to be a holder of Senior Indebtedness (or a trustee or
attorney-in-fact therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee or attorney-in-fact therefor). 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 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 Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article, 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.
SECTION 13.9. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such Proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, conservator,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
SECTION 13.10. Trustee Not Fiduciary for Holders of Senior
Indebtedness.
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and
shall not be liable to any such holders if it shall in good faith mistakenly pay
over or distribute to Holders of Securities or to the Company or to any other
Person cash, property or securities to which any holders of Senior Indebtedness
shall be entitled by virtue of this Article or otherwise.
SECTION 13.11. Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness that
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
-79-
<PAGE>
SECTION 13.12. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article in addition to or in place of the Trustee.
SECTION 13.13. Certain Conversions or Exchanges Deemed Payment.
For purposes of this Article only, (a) the issuance and delivery of
junior securities upon conversion or exchange of Securities of any series shall
not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any, on) or interest (including any Additional
Interest) on such Securities or on account of the purchase or other acquisition
of such Securities, and (b) the payment, issuance or delivery of cash, property
or securities (other than junior securities) upon conversion or exchange of a
Security of any series shall be deemed to constitute payment on account of the
principal of such security. For the purposes of this Section, the term "junior
securities" means (i) shares of any stock of any class of the Company, and (ii)
securities of the Company that are subordinated in right of payment to all
Senior Indebtedness that may be outstanding at the time of issuance or delivery
of such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article.
* * * *
This instrument 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.
[Remainder of page left intentionally blank; signatures appear on
following page.]
-80-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
FIRST CITIZENS BANCSHARES, INC.
By: /s/ Kenneth A. Black
----------------------------
Attest: Name: Kenneth A. Black
Title: Vice President and
/s/ John H.Gray Chief Financial Officer
- ---------------------
BANKERS TRUST COMPANY,
as Trustee, and not in its individual capacity
By: /s/ Sandra J. Shaffer
----------------------------
Attest: Name: Sandra J. Shaffer
Title: Assistant Vice President
/s/ Susan Johnson
- ---------------------
-81-
<PAGE>
ANNEX A
FORM OF RESTRICTED SECURITIES CERTIFICATE
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to Section 3.6(b) of
the Indenture referred to below)
[______________________],
as Securities Registrar
[address]
Re: [Title of Securities] of First Citizens BancShares, Inc.
(the "Securities")
Reference is made to the Junior Subordinated Indenture, dated as of
_____, 1998 (the "Indenture"), between First Citizens BancShares, Inc., a
Delaware corporation, and Bankers Trust Company, as Trustee. Terms used herein
and defined in the Indenture or in Regulation S, Rule 144A or Rule 144 under the
U.S. Securities Act of 1933 (the "Securities Act") are used here as so defined.
This certificate relates to $ aggregate principal amount of Securities,
which are evidenced by the following certificate(s)(the "Specified Securities"):
CUSIP No(s).______________________________
CERTIFICATE No(s).________________________
CURRENTLY IN GLOBAL FORM: Yes _____ No _____ (check one)
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through a Depositary or an Agent Member in the name of the Undersigned, as or on
behalf of the Owner. If the Specified Securities are not represented by a Global
Security, they are registered in the name of the Undersigned, as or on behalf of
the Owner. The Owner has requested that the Specified Securities be transferred
to a person (the "Transferee") who will take delivery in the form of a
Restricted Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being effected in
accordance with Rule 144A, Rule 904 of Regulation S or Rule 144 under the
Securities Act and all applicable
<PAGE>
securities laws of the states of the United States and other jurisdictions.
Accordingly, the Owner hereby further certifies that
(1) Rule 144A Transfers. If the transfer is being effected in accordance with
---------------------
Rule 144A:
(A) the Specified Securities are being transferred to a person that the
Owner and any person acting on its behalf reasonably believe is a "qualified
institutional buyer" within the meaning of Rule 144A, acquiring for its own
account or for the account of a qualified institutional buyer; and
(B) the Owner and any person acting on its behalf have taken reasonable
steps to ensure that the Transferee is aware that the Owner may be relying on
Rule 144A in connection with the transfer; and
(2) Rule 904 Transfers. If the transfer is being effected in accordance with
-------------------
Rule 904:
(A) the Owner is not a distributor of the Securities, an affiliate of
the Company or any such distributor or a person acting in behalf of any of the
foregoing;
(B) the offer of the Specified Securities was not made to a person in
the United States;
(C) either;
(i) at the time the buy order was originated, the Transferee
was outside the United States or the Owner and any person
acting on its behalf reasonably believed that the Transferee
was outside the United States, or
(ii) the transaction is being executed in, on or through the
facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another
designated offshore securities market and neither the Owner
nor any person acting on its behalf know that the transaction
has been prearranged with a buyer in the United States;
(D) no directed selling efforts within the meaning of Rule 902 of
Regulation S have been made in the United States by or on behalf of the Owner or
any affiliate thereof; and
(E) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
(3) Rule 144 Transfers. If the transfer is being effected pursuant to Rule 144:
------------------
(A) the transfer is occurring after a holding period of at least two
years (computed in accordance with paragraph (d) of Rule 144) has elapsed since
the date the Specified Securities were acquired from the Company or from an
affiliate (as such term is defined in Rule 144), or such shorter period as Rule
144 may hereinafter require, of the Company, whichever is later, and is being
effected in accordance with the applicable amount, manner of sale and notice
requirements of paragraphs (e), (f) and (h) of Rule 144;
<PAGE>
(B) the transfer is occurring after a holding period by the Owner of at
least three years has elapsed since the date the Specified Securities were
acquired from the Company or from an affiliate (as such term is defined in Rule
144) of the Company, whichever is later, and the Owner is not, and during the
preceding three months has not been, an affiliate of the Company; or
(C) the Owner is a Qualified Institutional Buyer under Rule 144A or has
acquired the Securities otherwise in accordance with Sections (1), (2) or (3)
hereof and is transferring the Securities to an institutional accredited
investor in a transaction exempt from the requirements of the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers (as defined in
the Trust Agreement relating to the Issuer Trust to which the Securities were
initially issued).
Dated:__________________ ___________________________________
(Print the name of the Undersigned,
as such term is defined in the
second paragraph of this certificate.)
By:_________________________
Name:
Title:
(If the Undersigned is a corporation,
partnership or fiduciary, the title of
the person signing on behalf of the
Undersigned must be stated.)
EXHIBIT 4.4
REGISTRATION RIGHTS AGREEMENT
Dated March 5, 1998
among
FIRST CITIZENS BANCSHARES, INC.,
FCB/NC CAPITAL TRUST I
and
WHEAT FIRST SECURITIES, INC.
as Initial Purchaser
<PAGE>
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and entered
into as of March 5, 1998, among FIRST CITIZENS BANCSHARES, INC., a registered
bank holding company organized under the laws of the State of Delaware (the
"Company"), FCB/NC CAPITAL TRUST I, a statutory business trust created under the
laws of the state of Delaware (the "Issuer Trust"), and WHEAT FIRST SECURITIES,
INC. (the "Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement dated March 2,
1998 (the "Purchase Agreement"), among the Company, as issuer of the 8.05%
Junior Subordinated Deferrable Interest Debentures due March 1, 2028 (the
"Junior Subordinated Debentures"), the Issuer Trust and the Initial Purchaser,
which provides for among other things, the sale by the Issuer Trust to the
Initial Purchaser of 15,000 of the Issuer Trust's 8.05% Capital Securities,
liquidation amount $1,000 per Capital Security (the "Capital Securities"), the
proceeds of which will be used by the Issuer Trust to purchase the Junior
Subordinated Debentures. The Capital Securities, together with the Junior
Subordinated Debentures and the Company's guarantee of the Capital Securities
(the "Guarantee") are collectively referred to as the "Securities." In order to
induce the Initial Purchaser to enter into the Purchase Agreement, the Company
and the Issuer Trust have agreed to provide to the Initial Purchaser and its
direct and indirect transferees the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the
closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, the following
capitalized defined terms shall have the following meanings:
"Advice" shall have the meaning set forth in the last paragraph of Section
3 hereof.
"Applicable Period" shall have the meaning set forth in Section 3(t)
hereof.
"Business Day" shall mean a day that is not a Saturday, a Sunday, or a day
on which banking institutions in New York, New York or in Raleigh, North
Carolina, are authorized or required to be closed.
"Closing Time" shall mean the Closing Time as defined in the Purchase
Agreement.
"Commission" shall mean the Securities and Exchange Commission.
"Company" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Issuer Trust; provided, however, that such
depositary must have an address in the Borough of Manhattan, in The City of New
York.
"Effectiveness Period" shall have the meaning set forth in Section 2(b)
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended
from time to time.
"Exchange Offer" shall mean the offer by the Company and the Issuer Trust
to the Holders to exchange all of the Registrable Securities (other than Private
Exchange Securities) for a like principal amount of Exchange Securities pursuant
to Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form), and all amendments and supplements to such registration statement, in
each case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section 2(a) hereof.
"Exchange Securities" shall mean (i) with respect to the Junior
Subordinated Debentures, the 8.05% New Junior Subordinated Deferrable Interest
Debentures due March 1, 2028 (the "New Junior Subordinated Debentures")
containing terms substantially identical to the Junior Subordinated Debentures
(except that they will not contain terms with respect to the transfer
restrictions under the Securities Act and will not provide for any liquidated
damages thereon), (ii) with respect to the Capital Securities, the Issuer
Trust's 8.05% New Capital Securities, liquidation amount $1,000 per Capital
Security (the "New Capital Securities") which will have terms substantially
identical to the Capital Securities (except that they will not contain terms
with respect to transfer restrictions under the Securities Act and will not
provide for any increase in the distribution rate thereon) and (iii) with
respect to the Guarantee, the Company's guarantee (the "New Guarantee") of the
New Capital Securities which will have terms substantially identical to the
Guarantee.
"Holder" shall mean the Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its successors, assigns and direct and
indirect transferees who become registered owners of Registrable Securities
under the Indenture or the Trust Agreement.
"Indenture" shall mean the Junior Subordinated Indenture dated as of March
5, 1998 relating to the Junior Subordinated Debentures and the New Junior
Subordinated Debentures among the Company, as issuer, and Bankers Trust Company,
as trustee, as the same may be amended from time to time in accordance with the
terms thereof.
"Initial Purchaser" shall have the meaning set forth in the preamble to
this Agreement.
"Inspectors" shall have the meaning set forth in Section 3(n) hereof.
"Issue Date" shall mean the date of original issuance of the Securities.
"Liquidated Damages" shall have the meaning set forth in Section 2(e)
hereof.
"Majority Holders" shall mean the Holders of a majority of the aggregate
liquidation amount of outstanding Capital Securities.
"Participating Broker-Dealer" shall have the meaning set forth in Section
3(t) hereof.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability company, or a government or
agency or political subdivision thereof.
"Private Exchange" shall have the meaning set forth in Section 2(a) hereof.
"Private Exchange Securities" shall have the meaning set forth in Section
2(a) hereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Registration Statement, and by all other
amendments and supplements to a prospectus, including post-effective amendments,
and in each case including all material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the preamble to
this Agreement.
"Records" shall have the meaning set forth in Section 3(n) hereof.
"Registrable Securities" shall mean the Securities and, if issued, the
Private Exchange Securities; provided, however, that Securities or Private
Exchange Securities, as the case may be, shall cease to be Registrable
Securities when (i) a Registration Statement with respect to such Securities or
Private Exchange Securities for the exchange or resale thereof, as the case may
be, shall have been declared effective under the Securities Act and such
Securities or Private Exchange Securities, as the case may be, shall have been
exchanged or disposed of pursuant to such Registration Statement, (ii) such
Securities or Private Exchange Securities, as the case may be, shall have been
sold to the public pursuant to Rule 144(k) (or any similar provision then in
force, but not Rule 144A) under the Securities Act, or (iii) such Securities or
Private Exchange Securities, as the case may be, shall have ceased to be
outstanding or (iv) with respect to the Securities, such Securities shall have
<PAGE>
been exchanged for Exchange Securities upon consummation of the Exchange
Offer and are thereafter freely tradeable by the holder thereof (other than an
affiliate of the Company).
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all Commission or National Association of Securities
Dealers, Inc. (the "NASD") registration and filing fees, including, if
applicable, the fees and expenses of any "qualified independent underwriter"
(and its counsel) that is required to be retained by any Holder of Registrable
Securities in accordance with the rules and regulations of the NASD, (ii) all
fees and expenses incurred in connection with compliance with state securities
or blue sky laws (including reasonable fees and disbursements of counsel for any
underwriters or Holders in connection with blue sky qualification of any of the
Exchange Securities or Registrable Securities) and compliance with the rules of
the NASD, (iii) all expenses of any Persons in preparing or assisting in
preparing, word processing, printing and distributing the Registration
Statement, any Prospectus and any amendments or supplements thereto, and in
preparing or assisting in preparing, printing and distributing any underwriting
agreements, securities sales agreements and other documents relating to the
performance of and compliance with this Agreement, (iv) all rating agency fees,
(v) the fees and disbursements of counsel for the Company and of the independent
certified public accountants of the Company, including the expenses of any "cold
comfort" letters required by or incident to such performance and compliance,
(vi) the fees and expenses of the Trustee, and any exchange agent or custodian,
(vii) all fees and expenses incurred in connection with the listing, if any, of
any of the Registrable Securities on any securities exchange or exchanges, and
(viii) the reasonable fees and expenses of any special experts retained by the
Company in connection with the Registration Statement.
"Registration Statement" shall mean any registration statement of the
Company and the Issuer Trust which covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement, and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Rule 144(k) Period" shall mean the period of two years (or such shorter
period as may hereafter be referred to in Rule 144(k) under the Securities Act
(or similar successor rule)) commencing on the Issue Date.
"Securities" shall have the meaning set forth in the preamble to this
Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended from
time to time.
"Shelf Registration" shall mean a registration effected pursuant to Section
2(b) hereof.
"Shelf Registration Event" shall have the meaning set forth in Section 2(b)
hereof.
"Shelf Registration Event Date" shall have the meaning set forth in Section
2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf registration" statement
of the Company and the Issuer Trust pursuant to the provisions of Section 2(b)
hereof which covers all of the Registrable Securities or all of the Private
Exchange Securities, as the case may be, on an appropriate form under Rule 415
under the Securities Act, or any similar rule that may be adopted by the
Commission, and all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
"TIA" shall have the meaning set forth in Section 3(l) hereof.
"Trust Agreement" shall mean the Amended and Restated Trust Agreement,
dated as of March 5, 1998, by the trustees named therein and the Company as
depositor.
"Trustees" shall mean any and all trustees with respect to (i) the Capital
Securities under the Trust Agreement, (ii) the Junior Subordinated Debentures
under the Indenture and (iii) the Guarantee.
2. Registration Under the Securities Act.
(a) Exchange Offer. To the extent not prohibited by any applicable law
or applicable interpretation of the staff of the Commission, the Company and the
Issuer Trust shall, for the benefit of the Holders, at the Company's cost, use
their respective best efforts to (i) cause to be filed with the Commission
within 150 days after the Issue Date an Exchange Offer Registration Statement on
an appropriate form under the Securities Act covering the Exchange Offer, (ii)
cause such Exchange Offer Registration Statement to be declared effective under
the Securities Act by the Commission not later than the date which is 180 days
after the Issue Date, and (iii) keep such Exchange Offer Registration Statement
effective for not less than 30 Business Days (or longer if required by
applicable law) after the date notice of the Exchange Offer is mailed to the
Holders. Upon the effectiveness of the Exchange Offer Registration Statement,
the Company and the Issuer Trust shall promptly commence the Exchange Offer and
use their respective best efforts to enable each Holder eligible and electing to
exchange Registrable Securities for a like principal amount of New Junior
Subordinated Debentures or a like liquidation amount of New Capital Securities,
together with the New Guarantee, as applicable (assuming that such Holder is not
an affiliate of the Company within the meaning of Rule 405 under the Securities
Act and is not a broker-dealer tendering Registrable Securities acquired
directly from the Company for its own account, acquires the Exchange Securities
in the ordinary course of such Holder's business and has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing the Exchange Securities) to transfer such Exchange
Securities from and after their receipt without any limitations or restrictions
under the Securities Act and under state securities or blue sky laws.
In connection with the Exchange Offer, the Company and the Issuer Trust
shall:
(i) mail to each Holder a copy of the Prospectus
forming part of the Exchange Offer Registration Statement, together
with an appropriate letter of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for
a period of not less than 30 days after the date notice thereof is
mailed to the Holders (or longer if required by applicable law) (such
period referred to herein as the "Exchange Period");
(iii) utilize the services of the Depositary for the
Exchange Offer;
(iv) permit Holders to withdraw tendered Securities
at any time prior to the close of business, New York City time, on the
last Business Day of the Exchange Period, by sending to the institution
specified in the notice, a telegram, telex, facsimile transmission or
letter setting forth the name of such Holder, the principal amount of
Securities delivered for exchange, and a statement that such Holder is
withdrawing his election to have such Securities exchanged;
(v) notify each Holder that any Security not tendered
by such Holder in the Exchange Offer will remain outstanding and
continue to accrue interest or accumulate distributions, as the case
may be, but will not retain any rights under this Agreement (except in
the case of the Initial Purchaser and Participating Broker-Dealers as
provided herein); and
(vi) otherwise comply in all respects with all
applicable laws relating to the Exchange Offer.
If the Initial Purchaser determines upon advice of its outside counsel that
it is not eligible to participate in the Exchange Offer with respect to the
exchange of Securities constituting any portion of an unsold allotment in the
initial distribution, as soon as practicable upon receipt by the Company and the
Issuer Trust of a written request from such Initial Purchaser, the Company and
the Issuer Trust, as
<PAGE>
applicable, shall issue and deliver to such Initial Purchaser in exchange
(the "Private Exchange") for the Securities held by such Initial Purchaser, a
like liquidation amount of New Capital Securities of the Issuer Trust, together
with the New Guarantee, or a like principal amount of the Junior Subordinated
Debentures of the Company, as applicable, that are identical (except that such
securities may bear a customary legend with respect to restrictions on transfer
pursuant to the Securities Act) to the Exchange Securities (the "Private
Exchange Securities") and which are issued pursuant to the Indenture, the Trust
Agreement or the Guarantee (which provides that the Exchange Securities will not
be subject to the transfer restrictions set forth in the Indenture or the Trust
Agreement, as applicable (other than to require minimum transfers thereof to be
in blocks of $100,000 principal amount or liquidation amount, as the case may
be), and that the Exchange Securities, the Private Exchange Securities and the
Securities will vote and consent together on all matters as one class and that
neither the Exchange Securities, the Private Exchange Securities nor the
Securities will have the right to vote or consent as a separate class on any
matter). The Private Exchange Securities shall be of the same series as the
Exchange Securities and the Company and the Issuer Trust will seek to cause the
CUSIP Service Bureau to issue the same CUSIP Numbers for the Private Exchange
Securities as for the Exchange Securities issued pursuant to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer and, if
applicable, the Private Exchange, the Company and the Issuer Trust, as the case
requires, shall:
(i) accept for exchange all Securities or portions thereof
tendered and not validly withdrawn pursuant to the Exchange Offer or
the Private Exchange;
(ii) deliver, or cause to be delivered, to the applicable
Trustee for cancellation all Securities or portions thereof so accepted
for exchange by the Company; and
(iii) issue, and cause the applicable Trustee under the
Indenture, the Trust Agreement or the Guarantee, as applicable, to
promptly authenticate and deliver to each Holder, new Exchange
Securities or Private Exchange Securities, as applicable, equal in
principal amount to the principal amount of the Junior Subordinated
Debentures or equal in liquidation amount to the liquidation amount of
the Capital Securities (together with the guarantee thereof) as are
surrendered by such Holder.
Distributions on each New Capital Security and interest on each New Junior
Subordinated Debenture issued pursuant to the Registered Exchange Offer and
Distributions or interest, as the case may be, on each Private Exchange Security
issued in the Private Exchange will accrue from the last date on which a
Distribution or interest was paid on the Capital Security or the Junior
Subordinated Debenture surrendered in exchange therefore or, if no Distribution
or interest has been paid on such Capital Security or Junior Subordinated
Debenture, from the Issue Date. To the extent not prohibited by any law or
applicable interpretation of the staff of the Commission, the Company and the
Issuer Trust shall use their best efforts to complete the Exchange Offer as
provided above, and shall comply with the applicable requirements of the
Securities Act, the Exchange Act and other applicable laws in connection with
the Exchange Offer. The Exchange Offer shall not be subject to any conditions,
other than that the Exchange Offer does not violate applicable law or any
applicable interpretation of the staff of the Commission. Each Holder of
Registrable Securities who wishes to exchange such Registrable Securities for
Exchange Securities in the Exchange Offer will be required to make certain
customary representations in connection therewith, including, in the case of any
Holder of Capital Securities, representations that (i) it is not an affiliate of
the Issuer Trust or the Company, (ii) the Exchange Securities to be received by
it were acquired in the ordinary course of its business and (iii) at the time of
the Exchange Offer, it has no arrangement with any person to participate in the
distribution (within the meaning of the Securities Act) of the New Capital
Securities. The Company and the Issuer Trust shall inform the Initial Purchaser,
after consultation with the Trustee, of the names and addresses of the Holders
to whom the Exchange Offer is made, and the Initial Purchaser shall have the
right to contact such Holders and otherwise facilitate the tender of Registrable
Securities in the Exchange Offer.
Upon consummation of the Exchange Offer in accordance with this Section
2(a), the provisions of this Agreement shall continue to apply, mutatis
mutandis, solely with respect to Registrable Securities that are Private
Exchange Securities and Exchange Securities held by Participating
Broker-Dealers, and the Company and the Issuer Trust shall have no further
obligation to register the Registrable Securities (other than Private Exchange
Securities) pursuant to Section 2(b) of this Agreement.
(b) Shelf Registration. In the event that: (i) the Company, the Issuer
Trust or the Majority Holders reasonably determine, after conferring with
counsel, that the Exchange Offer Registration provided in Section 2(a) above is
not available because of any change in law or in currently prevailing
interpretations of the staff of the Commission; (ii) the Company has received an
opinion of counsel, rendered by a law firm having a recognized national tax
practice, to the effect that, as a result of the consummation of the Exchange
Offer, there is more than an insubstantial risk that (x) the Issuer Trust would
be subject to United States federal income tax with respect to income received
or accrued on the Junior Subordinated Debentures or New Junior Subordinated
Debentures, (y) interest payable by the Company on such Junior Subordinated
Debentures or New Junior Subordinated Debentures would not be deductible by the
Company, in whole or in part, for United States federal income tax purposes, or
(z) the Issuer Trust would be subject to more than a de minimis amount of other
taxes, duties or other governmental charges; (iii) the Exchange Offer
Registration Statement is not declared effective within 180 days of the Issue
Date; or (iv) upon notice from any Holder on or before the 20th Business Day
following the consummation of the Exchange Offer that (A) it is prohibited by
law or Commission policy from participating in the Exchange Offer, (B) it may
not resell the New Capital Securities, the New Guarantee and the New Junior
Subordinated Debentures acquired by it in the Exchange Offer to the public
without delivering a prospectus and that the prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales or (C) it is a broker-dealer and owns Capital Securities acquired
directly from the Issuer Trust or an affiliate of the Issuer Trust, (any of the
events specified in clauses (i) through (iv) being a "Shelf Registration Event"
and the date of occurrence thereof, the "Shelf Registration Event Date"), the
Company and the Issuer Trust shall, at their cost, use their respective best
efforts to cause to be filed as promptly as practicable after such Shelf
Registration Event Date, as the case may be, and, in event, within 45 days after
such Shelf Registration Event Date (which shall be no earlier than 75 days after
the Closing Time), a Shelf Registration Statement providing for the sale by the
Holders of all of the Registrable Securities, and shall use their respective
best efforts to have such Shelf Registration Statement declared effective by the
Commission as soon as practicable. No Holder of Registrable Securities shall be
entitled to include any of its Registrable Securities in any Shelf Registration
pursuant to this Agreement unless and until such Holder agrees in writing to be
bound by all of the provisions of this Agreement applicable to such Holder and
furnishes to the Company and the Issuer Trust in writing, within 15 days
<PAGE>
after receipt of a request therefor, such information as the Company and
the Issuer Trust may, after conferring with counsel with regard to information
relating to Holders that would be required by the Commission to be included in
such Shelf Registration Statement or Prospectus included therein, reasonably
request for inclusion in the Shelf Registration Statement or Prospectus included
therein. Each Holder as to which any Shelf Registration is being effected agrees
to furnish to the Company and the Issuer Trust all information with respect to
such Holder necessary to make the information previously furnished to the
Company by such Holder not materially misleading.
The Company and the Issuer Trust agree to use their respective best efforts
to keep the Shelf Registration Statement continuously effective for the Rule
144(k) Period (subject to extension pursuant to the last paragraph of Section 3
hereof) or for such shorter period which will terminate when all of the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement or cease to be outstanding
(the "Effectiveness Period"). The Company and the Issuer Trust shall not permit
any securities other than Registrable Securities to be included in the Shelf
Registration. The Company and the Issuer Trust will, in the event a Shelf
Registration Statement is declared effective, provide to each Holder a
reasonable number of copies of the Prospectus which is a part of the Shelf
Registration Statement, notify each such Holder when the Shelf Registration has
become effective and use their respective best efforts to take certain other
actions as are required to permit certain unrestricted resales of the
Registrable Securities. The Company and the Issuer Trust further agree, if
necessary, to supplement or amend the Shelf Registration Statement, if required
by the rules, regulations or instructions applicable to the registration form
used by the Company for such Shelf Registration Statement or by the Securities
Act or by any other rules and regulations thereunder for shelf registrations,
and the Company and the Issuer Trust agree to furnish to the Holders of
Registrable Securities copies of any such supplement or amendment promptly after
its being used or filed with the Commission.
(c) Expenses. The Company, as issuer of the Junior Subordinated
Debentures, shall pay all Registration Expenses in connection with any
Registration Statement pursuant to Section 2(a) or 2(b) hereof and will
reimburse the Initial Purchaser for the reasonable fees and disbursements of
Alston & Bird LLP, counsel for the Initial Purchaser, incurred in connection
with the Exchange Offer and, if applicable, the Private Exchange, and either
Alston & Bird LLP or any one other counsel designated in writing by the Majority
Holders to act as counsel for the Holders of the Registrable Securities in
connection with a Shelf Registration Statement, which other counsel shall be
reasonably satisfactory to the Company. Except as provided herein, each Holder
shall pay all expenses of its counsel, underwriting discounts and commissions
and transfer taxes, if any, relating to the sale or disposition of such Holder's
Registrable Securities pursuant to the Shelf Registration Statement.
(d) Effective Registration Statement. An Exchange Offer Registration
Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement
pursuant to Section 2(b) will not be deemed to have become effective unless it
has been declared effective by the Commission; provided, however, that if, after
it has been declared effective, the offering of Registrable Securities pursuant
to a Shelf Registration Statement is interfered with by any stop order,
injunction or other order or requirement of the Commission or any other
governmental agency or court, such Registration Statement will be deemed not to
have been effective during the period of such interference, until the offering
of Registrable Securities pursuant to such Registration Statement may legally
resume. The Company and the Issuer Trust will be deemed not to have used their
best efforts to cause the Exchange Offer Registration Statement or the Shelf
Registration Statement, as the case may be, to become, or to remain, effective
during the requisite period if either of them voluntarily takes any action that
would result in such any Registration Statement not being declared effective or
in the Holders of Registrable Securities covered thereby not being able to
exchange or offer and sell such Registrable Securities during that period unless
such action is required by applicable law.
(e) Additional Interest. In the event that:
(i) (A) neither the Exchange Offer Registration
Statement nor a Shelf Registration Statement is filed with the
Commission on or prior to the 150th day after the Issue Date
or (B) notwithstanding that the Company and the Issuer Trust
have consummated or will consummate an Exchange Offer, the
Company and the Issuer Trust are required to file a Shelf
Registration Statement and such Shelf Registration Statement
is not filed on or prior to the date required by Section 2(b)
hereof, then commencing on the day after the applicable
required filing date, liquidated damages shall accrue on the
principal amount of the Junior Subordinated Debentures and, if
the Exchange Offer has been consummated, the New Junior
Subordinated Debentures, and additional Distributions shall
accumulate on the liquidation amount of the Capital Securities
and, if the Exchange Offer has been consummated, the New
Capital Securities, each at a rate of 0.25% per annum; or
(ii) (A) neither the Exchange Offer Registration
Statement nor a Shelf Registration Statement is declared
effective by the Commission on or prior to the 180th day after
the Issue Date or (B) notwithstanding that the Company and the
Issuer Trust have consummated or will consummate an Exchange
Offer, the Company and the Issuer Trust are required to file a
Shelf Registration Statement and such Shelf Registration
Statement is not declared effective by the Commission on or
prior to the 30th day after the date such Shelf Registration
Statement was required to be filed, then, commencing on the
181st day after the Issue Date, liquidated damages shall
accrue on the principal amount of the Junior Subordinated
Debentures and, if the Exchange Offer has been consummated,
the New Junior Subordinated Debentures, and additional
Distributions shall accumulate on the liquidation amount of
the Capital Securities and, if the Exchange Offer has been
consummated, the New Capital Securities, each at a rate of
0.25% per annum; or
(iii) (A) the Issuer Trust has not exchanged New
Capital Securities for all Capital Securities validly tendered
for exchange by their respective Holders or the Company has
not exchanged the New Guarantee or New Junior Subordinated
Debentures for the Guarantee or Junior Subordinated Debentures
validly tendered, in accordance with the terms of the Exchange
Offer on or prior to the 30th day after the date on which the
Exchange Offer Registration Statement was declared effective
or (B) if applicable, the Shelf Registration Statement has
been declared effective and such Shelf Registration Statement
ceases to be effective at any time prior to the expiration of
the Rule 144(k) Period (other than after such time as all
Capital Securities have been disposed of thereunder or
otherwise cease to be Registrable Securities), then liquidated
damages shall accrue on the principal amount of the Junior
Subordinated Debentures and, if the Exchange Offer has been
consummated, the New Junior Subordinated Debentures, and
additional Distributions shall accumulate on the liquidation
amount of the Capital Securities and, if the Exchange Offer
has been consummated, the New Capital Securities, each at a
rate of 0.25% per annum commencing on (x) the 31st day after
such effective date, in the case of (A) above, or (y) the day
such Shelf Registration Statement ceases to be effective in
the case of (B) above;
provided, however, that neither the liquidated damages on the Junior
<PAGE>
Subordinated Debentures and any outstanding New Junior Subordinated
Debentures, nor the additional distribution rate on the liquidation amount
of the Capital Securities and any outstanding New Capital Securities, may
exceed in the aggregate 0.25% per annum; provided, further, however, that (1)
upon the filing of the Exchange Offer Registration Statement or a Shelf
Registration Statement (in the case of clause (i) above), (2) upon the
effectiveness of the Exchange Offer Registration Statement or a Shelf
Registration Statement (in the case of clause (ii) above), or (3) upon the
exchange of New Capital Securities, the New Guarantee and New Junior
Subordinated Debentures for all Capital Securities, the Guarantee and all Junior
Subordinated Debentures tendered (in the case of clause (iii)(A) above), or upon
the effectiveness of the Shelf Registration Statement which had ceased to
remain effective (in the case of clause (iii)(B) above) liquidated damages
on the Junior Subordinated Debentures and any outstanding New Junior
Subordinated Debentures, and additional distributions on the liquidation amount
of the Capital Securities and any outstanding New Capital Securities as a result
of such clause (or relevant subclause thereof), as the case may be, shall cease
to accrue and accumulate.
Any amounts of liquidated damages and additional distributions due pursuant
to Section 2(e)(i), (ii) or (iii) above ("Liquidated Damages"), will be payable
in cash on the next succeeding March 1 or September 1, as the case may be, to
Holders on the relevant record dates for the payment of interest and
distributions pursuant to the Indenture and the Trust Agreement, respectively.
(f) Specific Enforcement. Without limiting the remedies available to
the Holders, the Company and the Issuer Trust acknowledge that any failure by
the Company or the Issuer Trust to comply with its obligations under Section
2(a) and Section 2(b) hereof may result in material irreparable injury to the
Holders for which there is no adequate remedy at law, that it would not be
possible to measure damages for such injuries precisely and that, in the event
of any such failure, any Holder may obtain such relief as may be required to
specifically enforce the Company's and the Issuer Trust's obligations under
Section 2(a) and Section 2(b) hereof.
3. Registration Procedures. In connection with the obligations of the
Company and the Issuer Trust with respect to the Registration Statements
pursuant to Sections 2(a) and 2(b) hereof, the Company and the Issuer Trust
shall use their best efforts to:
(a) prepare and file with the Commission a Registration Statement or
Registration Statements as prescribed by Sections 2(a) and 2(b) hereof within
the relevant time period specified in Section 2 hereof on the appropriate form
under the Securities Act, which form (i) shall be selected by the Company and
the Issuer Trust, (ii) shall, in the case of a Shelf Registration, be available
for the sale of the Registrable Securities by the selling Holders thereof and,
in the case of an Exchange Offer, be available for the exchange of the
Registrable Securities, and (iii) shall comply as to form in all material
respects with the requirements of the applicable form and include all financial
statements required by the Commission to be filed therewith; and use their best
efforts to cause such Registration Statement to become effective and remain
effective in accordance with Section 2 hereof, provided, however, that if (1)
such filing is pursuant to Section 2(b), or (2) a Prospectus contained in an
Exchange Offer Registration Statement filed pursuant to Section 2(a) is required
to be delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Securities, before filing any Registration Statement or
Prospectus or any amendments or supplements thereto, the Company and the Issuer
Trust shall furnish to and afford the Holders of the Registrable Securities and
each Participating Broker-Dealer, as the case may be, covered by such
Registration Statement, their counsel and the managing underwriters, if any, a
reasonable opportunity to review copies of all such documents (including copies
of any documents to be incorporated by reference therein and all exhibits
thereto) proposed to be filed. The Company and the Issuer Trust shall not file
any Registration Statement or Prospectus or any amendments or supplements
thereto in respect of which the Holders must be afforded an opportunity to
review prior to the filing of such document if the Majority Holders or such
Participating Broker-Dealer, as the case may be, their counsel or the managing
underwriters, if any, shall reasonably object;
(b) prepare and file with the Commission such amendments and
post-effective amendments to each Registration Statement as may be necessary to
keep such Registration Statement effective for the Effectiveness Period or the
Applicable Period, as the case may be; and cause each Prospectus to be
supplemented, if so determined by the Company or the Issuer Trust or requested
by the Commission, by any required prospectus supplement and as so supplemented
to be filed pursuant to Rule 424 (or any similar provision then in force) under
the Securities Act, and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations promulgated thereunder applicable to
it with respect to the disposition of all securities covered by each
Registration Statement during the Effectiveness Period or the Applicable Period,
as the case may be, in accordance with the intended method or methods of
distribution by the selling Holders thereof described in this Agreement
(including sales by any Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder of
Registrable Securities included in the Shelf Registration Statement, at least
three Business Days prior to filing, that a Shelf Registration Statement with
respect to the Registrable Securities is being filed and advising such Holder
that the distribution of Registrable Securities will be made in accordance with
the method selected by the Majority Holders; and (ii) furnish to each Holder of
Registrable Securities included in the Shelf Registration Statement and to each
underwriter of an underwritten offering of Registrable Securities, if any,
without charge, as many copies of each Prospectus, including each preliminary
Prospectus, and any amendment or supplement thereto and such other documents as
such Holder or underwriter may reasonably request, in order to facilitate the
public sale or other disposition of the Registrable Securities; and (iii)
consent to the use of the Prospectus or any amendment or supplement thereto by
each of the selling Holders of Registrable Securities included in the Shelf
Registration Statement in connection with the offering and sale of the
Registrable Securities covered by the Prospectus or any amendment or supplement
thereto;
(d) in the case of a Shelf Registration, register or qualify the
Registrable Securities under all applicable state securities or "blue sky" laws
of such jurisdictions by the time the applicable Registration Statement is
declared effective by the Commission as any Holder of Registrable Securities
covered by a Registration Statement and each underwriter of an underwritten
offering of Registrable Securities shall reasonably request in writing in
advance of such date of effectiveness, and do any and all other acts and things
which may be reasonably necessary or advisable to enable such Holder and
underwriter to consummate the disposition in each such jurisdiction of such
Registrable Securities owned by such Holder; provided, however, that the Company
and the Issuer Trust shall not be required to (i) qualify as a foreign
corporation or as a dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), (ii) file any
general consent to service of process in any jurisdiction where it would not
otherwise be subject to such service of process or (iii) subject itself to
taxation in any such jurisdiction if it is not then so subject;
<PAGE>
(e) in the case of (1) a Shelf Registration or (2) Participating
Broker-Dealers from whom the Company or the Issuer Trust has received prior
written notice that they will be utilizing the Prospectus contained in the
Exchange Offer Registration Statement as provided in Section 3(t) hereof, are
seeking to sell Exchange Securities and are required to deliver Prospectuses,
notify each Holder of Registrable Securities or such Participating
Broker-Dealers, as the case may be, their counsel and the managing underwriters,
if any, promptly and promptly confirm such notice in writing (i) when a
Registration Statement has become effective and when any post-effective
amendments and supplements thereto become effective, (ii) of any request by the
Commission or any state securities authority for amendments and supplements to a
Registration Statement or Prospectus or for additional information after the
Shelf Registration Statement has become effective, (iii) of the issuance by the
Commission or any state securities authority of any stop order suspending the
effectiveness of a Registration Statement or the qualification of the
Registrable Securities or the Exchange Securities to be offered or sold by the
Participating Broker-Dealer in any jurisdiction described in paragraph 3(d)
hereof or the initiation of any proceedings for that purpose, (iv) in the case
of a Shelf Registration, if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Securities covered thereby,
any of the representations and warranties of the Company and the Issuer Trust
contained in any purchase agreement, securities sales agreement or other similar
agreement shall cease to be true and correct in all material respects, (v) of
the happening of any event or the failure of any event to occur or the discovery
of any facts or otherwise, during the Effectiveness Period which makes any
statement made in such Registration Statement or the related Prospectus untrue
in any material respect or which causes such Registration Statement or
Prospectus to omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and (vi) the Company and the Issuer Trust's reasonable determination
that a post-effective amendment to the Registration Statement would be
appropriate;
(f) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the earliest
possible moment;
(g) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities included within the coverage of such Registration
Statement, without charge, at least one conformed copy of each Registration
Statement relating to such Shelf Registration and any post-effective amendment
thereto (without documents incorporated therein by reference or exhibits
thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate with the selling
Holders of Registrable Securities to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and not
bearing any restrictive legends and in such denominations (consistent with the
provisions of the Indenture and the Trust Agreement) and registered in such
names as the selling Holders or the underwriters may reasonably request at least
two Business Days prior to the closing of any sale of Registrable Securities
pursuant to such Shelf Registration Statement;
(i) in the case of a Shelf Registration or an Exchange Offer
Registration, upon the occurrence of any circumstance contemplated by Section
3(e)(ii), 3(e)(iii), 3(e)(v) or 3(e)(vi) hereof, use its best efforts to prepare
a supplement or post-effective amendment to such Registration Statement or the
related Prospectus or any document incorporated therein by reference or file any
other required document so that, as thereafter delivered to the purchasers of
the Registrable Securities, such Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; and to notify each Holder to suspend use of the Prospectus
as promptly as practicable after the occurrence of such an event;
(j) in the case of a Shelf Registration, a reasonable time prior to the
filing of any document which is to be incorporated by reference into a
Registration Statement or a Prospectus after the initial filing of a
Registration Statement, provide a reasonable number of copies of such document
to the Holders; and make such of the representatives of the Company and the
Issuer Trust as shall be reasonably requested by the Holders of Registrable
Securities or the Initial Purchaser on behalf of such Holders available for
discussion of such document;
(k) obtain a CUSIP number for all New Capital Securities and the
Capital Securities (and if the Issuer Trust has made a distribution of the
Junior Subordinated Debentures or New Junior Subordinated Debentures to the
Holders of the Capital Securities, the Junior Subordinated Debentures), not
later than the effective date of an Exchange Offer Registration Statement, and
provide the Trustee with printed certificates for the Exchange Securities or the
Registrable Securities in a form eligible for deposit with the Depositary;
(1) cause the Indenture, the Trust Agreement, the Guarantee, and the
New Guarantee to be qualified under the Trust Indenture Act of 1939 (the "TIA")
in connection with the registration of the Exchange Securities or Registrable
Securities, as the case may be, and effect such changes to such documents as may
be required for them to be so qualified in accordance with the terms of the TIA
and execute, and use its best efforts to cause the relevant trustee to execute,
all documents as may be required to effect such changes, and all other forms and
documents required to be filed with the Commission to enable such documents to
be so qualified in a timely manner;
(m) in the case of a Shelf Registration, enter into such agreements
(including underwriting agreements) as are customary in underwritten offerings
and take all such other appropriate actions as are reasonably requested in order
to expedite or facilitate the registration or the disposition of such
Registrable Securities, and in such connection, whether or not an underwriting
agreement is entered into and whether or not the registration is an underwritten
registration, if requested by (x) the Initial Purchaser, in the case where such
Initial Purchaser holds Securities acquired by it as part of its initial
distribution and (y) other Holders of Securities covered thereby: (i) make such
representations and warranties to Holders of such Registrable Securities and the
underwriters (if any), with respect to the business of the Issuer Trust, the
Company and its subsidiaries as then conducted and the Shelf Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are customarily made by
issuers to underwriters in underwritten offerings, and confirm the same if and
when requested; (ii) obtain opinions of counsel to the Company and the Issuer
Trust and updates thereof (which may be in the form of a reliance letter) in
form and substance reasonably satisfactory to the managing underwriters (if any)
and the Holders of a majority in principal amount of the Registrable Securities
being sold, addressed to each selling Holder and the underwriters (if any)
covering the matters customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested by such
underwriters (it being agreed that the matters to be covered by such opinions
may be subject to customary qualifications and exceptions); (iii) obtain "cold
comfort" letters and updates thereof in form and substance reasonably
satisfactory to the managing underwriters from the independent certified public
accountants of the Company and the Issuer
<PAGE>
Trust (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company and the Issuer Trust or of any
business acquired by the Company and the Issuer Trust for which financial
statements and financial data are, or are required to be, included in the Shelf
Registration Statement), addressed to each of the underwriters, such letters to
be in customary form and covering matters of the type customarily covered in
"cold comfort" letters in connection with underwritten offerings and such other
matters as reasonably requested by such underwriters in accordance with
Statement on Auditing Standards No. 72; and (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and procedures
no less favorable than those set forth in Section 4 hereof (or such other
provisions and procedures acceptable to Holders of a majority in aggregate
principal amount of Registrable Securities covered by such Shelf Registration
Statement and the managing underwriters or agents) with respect to all parties
to be indemnified pursuant to said Section (including, without limitation, such
underwriters and selling Holders). The above shall be done at each closing under
such underwriting agreement, or as and to the extent required thereunder;
(n) if (1) a Shelf Registration is filed pursuant to Section 2(b) or
(2) a Prospectus contained in an Exchange Offer Registration Statement filed
pursuant to Section 2(a) is required to be delivered under the Securities Act by
any Participating Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, make reasonably available for inspection by any selling
Holder of such Registrable Securities being sold or each such Participating
Broker-Dealer, as the case may be, any underwriter participating in any such
disposition of Registrable Securities, and any attorney, accountant or other
agent retained by any such selling Holder or each such Participating
Broker-Dealer, as the case may be, or underwriter (collectively, the
"Inspectors"), at the offices where normally kept, during reasonable business
hours, all financial and other records, pertinent corporate documents and
properties of the Issuer Trust, the Company and its subsidiaries (collectively,
the "Records") as shall be reasonably necessary to enable them to exercise any
applicable due diligence responsibilities, and cause the officers, directors and
employees of the Issuer Trust, the Company and its subsidiaries to supply all
relevant information in each case reasonably requested by any such Inspector in
connection with such Shelf Registration Statement provided, however, that the
foregoing inspection and information gathering shall be coordinated by the
Initial Purchaser and, on behalf of the selling Holders of Registrable
Securities, by one counsel designated as described in Section 2(c) hereof.
Records which the Company and the Issuer Trust determine, in good faith, to be
confidential and any records which either of them notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the disclosure
of such Records is necessary to avoid or correct a material misstatement or
omission in such Registration Statement, (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction or is necessary in connection with any action, suit or proceeding
or (iii) the information in such Records has been made generally available to
the public. Each selling Holder of such Registrable Securities and each such
Participating Broker-Dealer will be required to agree in writing that
information obtained by it as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of the Issuer Trust or the Company unless and
until such is made generally available to the public. Each selling Holder of
such Registrable Securities and each such Participating Broker-Dealer will be
required to further agree in writing that it will, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction, give notice to
the Company and allow the Company at its expense to undertake appropriate action
to prevent disclosure of the Records deemed confidential;
(o) comply with all applicable rules and regulations of the Commission
so long as any provision of this Agreement shall be applicable and make
generally available to their respective security holders earning statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no later
than 45 days after the end of any 12-month period (or 90 days after the end of
any 12-month period if such period is a fiscal year) (i) commencing at the end
of any fiscal quarter in which Registrable Securities are sold to underwriters
in a firm commitment or best efforts underwritten offering and (ii) if not sold
to underwriters in such an offering, commencing on the first day of the first
fiscal quarter of the Company after the effective date of a Registration
Statement, which statements shall cover said 12-month periods;
(p) upon consummation of an Exchange Offer or a Private Exchange, if
requested by a Trustee, obtain an opinion of counsel to the Company addressed to
the Trustee for the benefit of all Holders of Registrable Securities
participating in the Exchange Offer or the Private Exchange, as the case may be,
and which includes an opinion that (i) the Company or the Issuer Trust, as the
case requires, has duly authorized, executed and delivered the Exchange
Securities or the Private Exchange Securities, as the case may be, and (ii) each
of the Exchange Securities or the Private Exchange Securities, as the case may
be, constitute a legal, valid and binding obligation of the Company or the
Issuer Trust, as the case requires, enforceable against the Company or the
Issuer Trust, as the case requires, in accordance with their respective terms
(in each case, with customary exceptions);
(q) if an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Securities by Holders to the Company or the
Issuer Trust, as applicable (or to such other Person as directed by the Company
or the Issuer Trust, respectively), in exchange for the Exchange Securities or
the Private Exchange Securities, as the case may be, mark, or cause to be
marked, on such Registrable Securities delivered by such Holders that such
Registrable Securities are being cancelled in exchange for the Exchange
Securities or the Private Exchange Securities, as the case may be; in no event
shall such Registrable Securities be marked as paid or otherwise satisfied;
(r) cooperate with each seller of Registrable Securities covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the NASD;
(s) use its best efforts to take all other steps necessary to effect
the registration of the Registrable Securities covered by a Registration
Statement contemplated hereby;
(t) (A) in the case of the Exchange Offer Registration Statement (i)
include in the Exchange Offer Registration Statement a section entitled "Plan of
Distribution," which section shall be reasonably acceptable to the Initial
Purchaser or another representative of the Participating Broker-Dealers, and
which shall contain a summary statement of the positions taken or policies made
by the staff of the Commission with respect to the potential "underwriter"
status of any broker-dealer (a "Participating Broker-Dealer") that holds
Registrable Securities acquired for its own account as a result of market-making
activities or other trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Securities to be
received by such broker-dealer in the Exchange Offer, whether such positions or
policies have been publicly disseminated
<PAGE>
by the staff of the Commission or such positions or policies, in the
reasonable judgment of the Initial Purchaser or such other representative,
represent the prevailing views of the staff of the Commission, including a
statement that any such broker-dealer who receives Exchange Securities for
Registrable Securities pursuant to the Exchange Offer may be deemed a statutory
underwriter and must deliver a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Securities, (ii)
furnish to each Participating Broker-Dealer who has delivered to the Company the
notice referred to in Section 3(e), without charge, as many copies of each
Prospectus included in the Exchange Offer Registration Statement, including any
preliminary prospectus, and any amendment or supplement thereto, as such
Participating Broker-Dealer may reasonably request (each of the Company and the
Issuer Trust hereby consents to the use of the Prospectus forming part of the
Exchange Offer Registration Statement or any amendment or supplement thereto by
any Person subject to the prospectus delivery requirements of the Securities
Act, including all Participating Broker-Dealers, in connection with the sale or
transfer of the Exchange Securities covered by the Prospectus or any amendment
or supplement thereto), (iii) keep the Exchange Offer Registration Statement
effective and amend and supplement the Prospectus contained therein in order to
permit such Prospectus to be lawfully delivered by all Persons subject to the
prospectus delivery requirements of the Securities Act for such period of time
as such Persons must comply with such requirements under the Securities Act and
applicable rules and regulations in order to resell the Exchange Securities;
provided, however, that such period shall not be required to exceed 90 days (or
such longer period if extended pursuant to the last sentence of Section 3
hereof) (the "Applicable Period"), and (iv) include in the transmittal letter or
similar documentation to be executed by an exchange offeree in order to
participate in the Exchange Offer (x) the following provision:
"If the exchange offeree is a broker-dealer holding Registrable
Securities acquired for its own account as a result of market-making
activities or other trading activities, it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any
resale of Exchange Securities received in respect of such Registrable
Securities pursuant to the Exchange Offer";
and (y) a statement to the effect that by a broker-dealer making the
acknowledgment described in clause (x) and by delivering a Prospectus in
connection with the exchange of Registrable Securities, the broker-dealer will
not be deemed to admit that it is an underwriter within the meaning of the
Securities Act; and
(B) in the case of any Exchange Offer Registration Statement,
the Company and the Issuer Trust agree to deliver to the Initial Purchaser or to
another representative of the Participating Broker-Dealers, if requested by such
Initial Purchaser or such other representative of the Participating
Broker-Dealers, on behalf of the Participating Broker-Dealers upon consummation
of the Exchange Offer (i) an opinion of counsel in form and substance reasonably
satisfactory to the Initial Purchaser or such other representative of the
Participating Broker-Dealers, covering the matters customarily covered in
opinions requested in connection with Exchange Offer Registration Statements and
such other matters as may be reasonably requested (it being agreed that the
matters to be covered by such opinion may be subject to customary qualifications
and exceptions), (ii) an officers' certificate containing certifications
substantially similar to those set forth in Section 5(f) of the Purchase
Agreement and such additional certifications as are customarily delivered in a
public offering of debt securities and (iii) as well as upon the effectiveness
of the Exchange Offer Registration Statement, a comfort letter, in each case, in
customary form if permitted by Statement on Auditing Standards No. 72.
The Company or the Issuer Trust may require each seller of Registrable
Securities as to which any registration is being effected to furnish to the
Company or the Issuer Trust, as applicable, such information regarding such
seller as may be required by the staff of the Commission to be included in a
Registration Statement. The Company or the Issuer Trust may exclude from such
registration the Registrable Securities of any seller who unreasonably fails to
furnish such information within a reasonable time after receiving such request.
The Company shall have no obligation to register under the Securities Act the
Registrable Securities of a seller who so fails to furnish such information.
In the case of (1) a Shelf Registration Statement or (2) Participating
Broker-Dealers who have notified the Company and the Issuer Trust that they will
be utilizing the Prospectus contained in the Exchange Offer Registration
Statement as provided in Section 3(t) hereof and are seeking to sell Exchange
Securities and are required to deliver Prospectuses, each Holder agrees that,
upon receipt of any notice from the Company or the Issuer Trust of the happening
of any event of the kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(v) or
3(e)(vi) hereof, such Holder will forthwith suspend use of the Prospectus and
discontinue disposition of Registrable Securities pursuant to a Registration
Statement until such Holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 3(i) hereof or until it is advised in
writing (the "Advice") by the Company and the Issuer Trust that the use of the
applicable Prospectus may be resumed, and, if so directed by the Company and the
Issuer Trust, such Holder will deliver to the Company or the Issuer Trust (at
the Company's or the Issuer Trust's expense, as the case requires) all copies in
such Holder's possession, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Registrable Securities or Exchange
Securities, as the case may be, current at the time of receipt of such notice.
If the Company or the Issuer Trust shall give any such notice to suspend the
disposition of Registrable Securities, or Exchange Securities, as the case may
be, pursuant to a Registration Statement, the Company and the Issuer Trust shall
use their best efforts to file and have declared effective (if an amendment) as
soon as practicable an amendment or supplement to the Registration Statement and
shall extend the period during which such Registration Statement shall be
maintained effective pursuant to this Agreement by the number of days in the
period from and including the date of the giving of such notice to and including
the date when the Company and the Issuer Trust shall have made available to the
Holders (x) copies of the supplemented or amended Prospectus necessary to resume
such dispositions or (y) the Advice.
4. Indemnification and Contribution.
(a) In connection with any Registration Statement, the Company and the
Issuer Trust shall, jointly and severally, indemnify and hold harmless the
Initial Purchaser, each Holder, each underwriter who participates in an offering
of the Registrable Securities, each Participating Broker-Dealer, each Person, if
any, who controls any of such parties within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and each of their respective
directors, officers, employees and agents, as follows:
(i) from and against any and all loss,
liability, claim, damage and expense whatsoever, joint or several, as
incurred, arising out of any untrue statement or alleged untrue statement of
a material fact contained in any Registration Statement (or any amendment
thereto), covering Registrable Securities or Exchange Securities, including all
documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein
<PAGE>
not misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) from and against any and all loss, liability, claim,
damage and expense whatsoever, joint or several, as incurred, to the
extent of the aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any court or governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the prior
written consent of the Company; and
(iii) from and against any and all expenses whatsoever, as
incurred (including reasonable fees and disbursements of counsel chosen
by such Holder, such Participating Broker-Dealer, or any underwriter
(except to the extent otherwise expressly provided in Section 4(c)
hereof)), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any court
or governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) of this Section
4(a);
provided, however, that (i) this indemnity does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished in writing to the
Company or the Issuer Trust by such Holder, such Participating Broker-Dealer, or
any underwriter with respect to such Holder, Participating Broker-Dealer or any
underwriter, as the case may be, expressly for use in a Registration Statement
(or any amendment thereto) or any Prospectus (or any amendment or supplement
thereto) and (ii) the Company and the Issuer Trust shall not be liable to any
such Holder, Participating Broker-Dealer, any underwriter or controlling person,
with respect to any untrue statement or alleged untrue statement or omission or
alleged omission in any preliminary Prospectus to the extent that any such loss,
liability, claim, damage or expense of any Holder, Participating Broker-Dealer,
any underwriter or controlling person results from the fact that such Holder,
any underwriter or Participating Broker-Dealer, sold Securities to a person to
whom there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the final Prospectus as then amended or supplemented if the
Company had previously furnished copies thereof to such Holder, underwriter, or
Participating Broker-Dealer, and the loss, liability, claim, damage or expense
of such Holder, underwriter, Participating Broker-Dealer, or controlling person
results from an untrue statement or omission of a material fact contained in the
preliminary Prospectus which was corrected in the final Prospectus. Any amounts
advanced by the Company or the Issuer Trust to an indemnified party pursuant to
this Section 4 as a result of such losses shall be returned to the Company or
the Issuer Trust if it shall be finally determined by such a court in a judgment
not subject to appeal or final review that such indemnified party was not
entitled to indemnification by the Company or the Issuer Trust.
(b) Each Holder agrees, severally and not jointly, to indemnify and
hold harmless the Company, the Issuer Trust, any underwriter and the other
selling Holders and each of their respective directors, officers (including each
officer of the Company and the Issuer Trust who signed the Registration
Statement), employees and agents and each Person, if any, who controls the
Company, the Issuer Trust, any underwriter or any other selling Holder within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, from and against any and all loss, liability, claim, damage and expense
whatsoever described in the indemnity contained in Section 4(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in a Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company or the Issuer Trust by such selling Holder with respect to such Holder
expressly for use in such Registration Statement (or any amendment thereto), or
any such Prospectus (or any amendment or supplement thereto); provided, however,
that, in the case of a Shelf Registration Statement, no such Holder shall be
liable for any amount hereunder in excess of the amount of net proceeds received
by such Holder from the sale of Registrable Securities pursuant to such Shelf
Registration Statement.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers properly
served on such indemnified party, but failure to so notify an indemnifying party
shall not relieve such indemnifying party from any liability which it may have
under this Section 4, except to the extent that it is materially prejudiced by
such failure. An indemnifying party may participate at its own expense in the
defense of such action. If an indemnifying party so elects within a reasonable
time after receipt of such notice, an indemnifying party, severally or jointly
with any other indemnifying parties receiving such notice, may assume the
defense of such action with counsel chosen by it and reasonably acceptable to
the indemnified parties defendant in such action, provided, however, that if (i)
representation of such indemnified party by the same counsel would present a
conflict of interest or (ii) the actual or potential defendants in, or targets
of, any such action include both the indemnified party and the indemnifying
party and any such indemnified party reasonably determines that there may be
legal defenses available to such indemnified party which are different from or
in addition to those available to such indemnifying party, then in the case of
clauses (i) and (ii) of this Section 4(c) such indemnifying party and counsel
for each indemnifying party or parties shall not be entitled to assume such
defense. If an indemnifying party is not entitled to assume the defense of such
action as a result of the proviso to the preceding sentence, counsel for such
indemnifying party and counsel for each indemnified party or parties shall be
entitled to conduct the defense of such indemnified party or parties. If an
indemnifying party assumes the defense of such action, in accordance with and as
permitted by the provisions of this paragraph, such indemnifying parties shall
not be liable for any fees and expenses of counsel for the indemnified parties
incurred thereafter in connection with such action. In no event shall the
indemnifying parties be liable for the fees and expenses of more than one
counsel (in addition to local counsel), separate from its own counsel, for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 4 (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise
<PAGE>
or consent (i) includes an unconditional written release in form and substance
satisfactory to the indemnified parties of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) Notwithstanding the last sentence of Section 4(c), if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for reasonable fees and expenses of counsel pursuant to
Section 4(a)(iii) above, such indemnifying party agrees that it shall be liable
for any settlement effected without its written consent if (i) such settlement
is entered into more than 45 days after receipt by such indemnifying party of
the aforesaid request, (ii) such indemnifying party shall have received notice
of the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement; provided that an indemnifying party shall not be liable for any such
settlement effected without its consent if such indemnifying party (1)
reimburses such indemnified party in accordance with such request to the extent
it considers reasonable and (2) provides written notice to the indemnified party
substantiating the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
(e) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company, the Issuer Trust,
and the Holders shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by such indemnity agreement
incurred by the Company, the Issuer Trust, and the Holders, as incurred;
provided that no Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any Person that was not guilty of such fraudulent misrepresentation. As between
the Company, the Issuer Trust, and the Holders, such parties shall contribute to
such aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnity agreement in such proportion as shall be
appropriate to reflect the relative fault of the Company and Issuer Trust, on
the one hand, and the Holders, on the other hand, with respect to the statements
or omissions which resulted in such loss, liability, claim, damage or expense,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault of the Company and the Issuer Trust, on the
one hand, and of the Holders, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Issuer Trust, on the one
hand, or by or on behalf of the Holders, on the other, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Issuer Trust and the Holders of the
Registrable Securities agree that it would not be just and equitable if
contribution pursuant to this Section 4 were to be determined by pro rata
allocation or by any other method of allocation that does not take into account
the relevant equitable considerations. For purposes of this Section 4, each
affiliate of a Holder, and each director, officer, employee, agent and Person,
if any, who controls a Holder or such affiliate within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act shall have the same
rights to contribution as such Holder, and each director of each of the Company
or the Issuer Trust, each officer of each of the Company or the Issuer Trust who
signed the Registration Statement, and each Person, if any, who controls each of
the Company and the Issuer Trust within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as each of the Company or the Issuer Trust.
5. Participation in Underwritten Registrations. No Holder may participate
in any underwritten registration hereunder unless such Holder (a) agrees to sell
such Holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all reasonable questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up letters and
other documents reasonably required under the terms of such underwriting
arrangements.
6. Selection of Underwriters. The Holders of Registrable Securities covered
by a Shelf Registration Statement who desire to do so may sell the securities
covered by such Shelf Registration in an underwritten offering. In any such
underwritten offering, the underwriter or underwriters and manager or managers
that will administer the offering will be selected by the Holders of a majority
in aggregate principal amount of the Registrable Securities included in such
offering; provided, however, that such underwriters and managers must be
reasonably satisfactory to the Company and the Issuer Trust.
7. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company or the Issuer
Trust is subject to the reporting requirements of Section 13 or 15 of the
Exchange Act and any Registrable Securities remain outstanding, each of the
Company and the Issuer Trust, as the case may be, will use its best efforts to
file the reports required to be filed by it under the Securities Act and Section
13(a) or 15(d) of the Exchange Act and the rules and regulations adopted by the
Commission thereunder, or, if it ceases to be so required to file such reports,
it will, upon the request of any Holder of Registrable Securities (a) make
publicly available such information as is necessary to permit sales of their
securities pursuant to Rule 144 under the Securities Act, (b) deliver such
information to a prospective purchaser as is necessary to permit sales of their
securities pursuant to Rule 144A under the Securities Act and it will take such
further action as any Holder of Registrable Securities may reasonably request,
and (c) take such further action that is reasonable in the circumstances, in
each case, to the extent required from time to time to enable such Holder to
sell its Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (i) Rule 144 under the
Securities Act, as such rule may be amended from time to time, (ii) Rule 144A
under the Securities Act, as such rule may be amended from time to time, or
(iii) any similar rules or regulations hereafter adopted by the Commission. Upon
the request of any Holder of Registrable Securities, the Company or the Issuer
Trust, as the case may be, will deliver to such Holder a written statement as to
whether it has complied with such requirements.
(b) No Inconsistent Agreements. The Company or the Issuer Trust has not
entered into nor will the Company or the Issuer Trust on or after the date of
this Agreement enter into any agreement which is inconsistent with the rights
granted to the Holders of Registrable Securities in this Agreement or otherwise
conflicts with the provisions hereof. The rights granted to the Holders
hereunder do not in any way conflict with and are not inconsistent with the
rights granted to the holders of the Company's or the Issuer Trust's other
issued and outstanding securities under any such agreements.
(c) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
<PAGE>
and waivers or consents to departures from the provisions hereof may not be
given unless the Company and the Issuer Trust have obtained the written
consent of Holders of at least a majority in aggregate principal amount of the
outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or departure; provided no amendment, modification or
supplement or waiver or consent to the departure with respect to the provisions
of Section 4 hereof shall be effective as against any Holder of Registrable
Securities unless consented to in writing by such Holder of Registrable
Securities. Notwithstanding the foregoing sentence, (i) this Agreement may be
amended, without the consent of any Holder of Registrable Securities, by written
agreement signed by the Company, the Issuer Trust and the Initial Purchaser, to
cure any ambiguity, correct or supplement any provision of this Agreement that
may be inconsistent with any other provision of this Agreement or to make any
other provisions with respect to matters or questions arising under this
Agreement which shall not be inconsistent with other provisions of this
Agreement, (ii) this Agreement may be amended, modified or supplemented, and
waivers and consents to departures from the provisions hereof may be given, by
written agreement signed by the Company, the Issuer Trust and the Initial
Purchaser to the extent that any such amendment, modification, supplement,
waiver or consent is, in their reasonable judgment, necessary or appropriate to
comply with applicable law (including any interpretation of the Staff of the
Commission) or any change therein and (iii) to the extent any provision of this
Agreement relates to the Initial Purchaser, such provision may be amended,
modified or supplemented, and waivers or consents to departures from such
provisions may be given, by written agreement signed by the Initial Purchaser,
the Company and the Issuer Trust.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
the Company or the Issuer Trust by means of a notice given in accordance with
the provisions of this Section 7(d), which address initially is, with respect to
the Initial Purchaser, the address set forth in the Purchase Agreement; and (ii)
if to the Company or the Issuer Trust, initially at the Company's address set
forth in the Purchase Agreement and thereafter at such other address, notice of
which is given in accordance with the provisions of this Section 7(d).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the
address specified in the Indenture.
(e) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns and transferees of the Initial
Purchaser, including, without limitation and without the need for an express
assignment, subsequent Holders; provided, however, that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Purchase Agreement or the Indenture.
If any transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable Securities
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Registrable Securities, such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement and such Person shall be entitled to receive the benefits hereof.
(f) Third-Party Beneficiary. The Initial Purchaser shall be a third
party beneficiary of the agreements made hereunder between the Company and the
Issuer Trust, on the one hand, and the Holders, on the other hand, and shall
have the right to enforce such agreements directly to the extent it deems such
enforcement necessary or advisable to protect its rights or the rights of
Holders hereunder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN
THE STATE OF NORTH CAROLINA. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT,
AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS. EACH OF THE
PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT.
(j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) Securities Held by the Company, the Issuer Trust or its Affiliates.
Whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, Registrable Securities held by the
Company, the Issuer Trust or its affiliates (as such term is defined in Rule 405
under the Securities Act) shall not be counted in determining whether such
consent or approval was given by the Holders of such required percentage.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
FIRST CITIZENS BANCSHARES, INC.
By: s/ Kenneth A. Black
-----------------------------
Name: Kenneth A. Black
-----------------------------
Title: Vice President
-----------------------------
FCB/NC CAPITAL TRUST I
By: s/ John H. Gray
-----------------------------
Name: John H. Gray
-----------------------------
Title: Administrator
-----------------------------
Confirmed and accepted as of the date first above written:
WHEAT FIRST SECURITIES, INC.
By: s/ Scott R. Anderson
- -------------------------
Name: Scott R. Anderson
- -------------------------
Title: Managing Director
- -------------------------
Exhibit 4.5
This Capital Securities Certificate is a Global Capital Securities
Certificate within the meaning of the Trust Agreement hereinafter referred to
and is registered in the name of a Depositary or a nominee of a Depositary. This
Capital Securities Certificate is exchangeable for Capital Securities
Certificates registered in the name of a person other than the Depositary or its
nominee only in the limited circumstances described in the Trust Agreement and
may not be transferred except as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary, except in the limited circumstances described in the
Trust Agreement.
Unless this Capital Securities Certificate is presented by an authorized
representative of The Depository Trust Company, a New York Corporation ("DTC"),
to FCB/NC Capital Trust I or its agent for registration of transfer, exchange or
payment, and any Capital Securities Certificate issued is registered in the name
of Cede & Co. or such other name as is requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO A PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
THE CAPITAL SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000 (100 CAPITAL SECURITIES).
ANY SUCH TRANSFER OF CAPITAL SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT
OF LESS THAN $100,000 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
CAPITAL SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE RECEIPT OF
DISTRIBUTIONS ON SUCH CAPITAL SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN SUCH CAPITAL SECURITIES.
NO EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT ACCOUNT SUBJECT
TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") (EACH, A "PLAN"), NO ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN
ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET
ENTITY"), AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN, MAY ACQUIRE OR HOLD
THIS CAPITAL SECURITIES CERTIFICATE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASE
OR HOLDING IS COVERED BY THE EXEMPTIVE RELIEF PROVIDED BY U.S. DEPARTMENT OF
LABOR PROHIBITED TRANSACTION CLASS EXEMPTION ("PTCE") 96-23, 95-60, 91-38, 90-1
OR 84-14 OR ANOTHER APPLICABLE EXEMPTION WITH RESPECT TO SUCH PURCHASE OR
HOLDING. ANY PURCHASER OR HOLDER OF THIS CAPITAL SECURITIES CERTIFICATE OR ANY
INTEREST HEREIN THAT IS A PLAN OR A PLAN ASSET ENTITY OR IS PURCHASING SUCH
SECURITIES ON BEHALF OF OR WITH "PLAN ASSETS" WILL BE DEEMED TO HAVE REPRESENTED
BY ITS PURCHASE AND HOLDING HEREOF THAT (A) THE PURCHASE AND HOLDING OF THE
CAPITAL SECURITIES IS COVERED BY THE EXEMPTIVE RELIEF PROVIDED BY PTCE 96-23,
95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION, (B) THE COMPANY AND
THE ADMINISTRATORS ARE NOT "FIDUCIARIES" WITHIN THE MEANING OF SECTION 3(21) OF
ERISA AND THE REGULATIONS THEREUNDER, WITH RESPECT TO SUCH PERSON'S INTEREST IN
THE CAPITAL SECURITIES OR THE JUNIOR SUBORDINATED DEBENTURES, AND (C) IN
PURCHASING THE CAPITAL SECURITIES SUCH PERSON APPROVES THE PURCHASE OF THE
JUNIOR SUBORDINATED DEBENTURES AND THE APPOINTMENT OF THE ISSUER TRUSTEES.
<PAGE>
CERTIFICATE NUMBER AGGREGATE LIQUIDATION AMOUNT
P-__ $_______________
(______________ CAPITAL SECURITIES)
CUSIP NO. _____________
CERTIFICATE EVIDENCING CAPITAL SECURITIES
OF
FCB/NC CAPITAL TRUST I
8.05% CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FCB/NC Capital Trust I, a statutory business trust created under the laws of
the State of Delaware (the "Issuer Trust"), hereby certifies that Cede & Co.
(the "Holder") is the registered owner of _____________________________________
($_____________) aggregate liquidation amount of capital securities of the
Issuer Trust representing a preferred undivided beneficial interest in the
assets of the Issuer Trust and designated the FCB/NC Capital Trust I 8.05%
Capital Securities (liquidation amount $1,000 per Capital Security) (the
"Capital Securities"). The Capital Securities are transferable on the books and
records of the Issuer 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 5.5 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities are set forth in, and this certificate and
the Capital 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 Issuer Trust, dated as of March 5, 1998, as the same may be
amended from time to time (the "Trust Agreement"), among First Citizens
BancShares, Inc., as Depositor, Bankers Trust Company, as Property Trustee,
Bankers Trust (Delaware), as Delaware Trustee, the Administrators named therein
and the Holders of Trust Securities, including the designation of the terms of
the Capital Securities as set forth therein. The Holder is entitled to the
benefits of the Guarantee Agreement entered into by First Citizens BancShares,
Inc., as Guarantor, and Bankers Trust Company, as Guarantee Trustee, dated as of
______, 1998 (the "Guarantee Agreement"), to the extent provided therein. The
Issuer Trust will furnish a copy of the Trust Agreement and the Guarantee
Agreement to the Holder without charge upon written request to the Issuer Trust
by contacting the Issuer Trustees.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
Terms used but not defined herein have the meanings set forth in the Trust
Agreement.
IN WITNESS WHEREOF, one of the Administrators of the Issuer Trust has
executed this certificate this ______ day of ________, 1998.
FCB/NC CAPITAL TRUST I
By:________________________________
Kenneth A. Black, Administrator
AUTHENTICATED:
BANKERS TRUST COMPANY, as Property Trustee
By:______________________________
Authorized Signatory
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital
Security to:
________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________
________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints________________________________________
________________________________________________________________
agent to transfer this Capital Securities Certificate on the books of the
Issuer Trust. The agent may substitute another to act for him or her.
Date:___________________
Signature:_________________________________________________________
(Sign exactly as your name appears on the
other side of this Capital Securities Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
FIRST CITIZENS BANCSHARES, INC.
8.05% JUNIOR SUBORDINATED DEFERRABLE
INTEREST DEBENTURES
DUE MARCH 1, 2028
No.____________ $_________
FIRST CITIZENS BANCSHARES, INC., a Delaware corporation (hereinafter called
the "Company", which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to FCB/NC
CAPITAL TRUST I, or registered assigns, the principal sum of ______________
Dollars ($_____________ ) on March 1, 2028, or such other principal amount
represented hereby as may be set forth in the records of the Securities
Registrar hereinafter referred to in accordance with the Indenture. The Company
further promises to pay interest on said principal from [ISSUANCE DATE], or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, semi-annually (subject to deferral as set forth herein) in arrears
on March 1 and September 1 of each year, commencing on _____________________,
_______ at the rate of 8.05% per annum, together with Additional Sums, if any,
as provided in Section 10.6 of the Indenture, until the principal hereof is paid
or duly provided for or made available for payment; provided that any overdue
principal, premium or Additional Sums and any overdue installment of interest
shall bear Additional Interest at the rate of 8.05% per annum (to the extent
that the payment of such interest shall be legally enforceable), compounded
semiannually, from the dates such amounts are due until they are paid or made
available for payment, and such interest shall be payable on demand. The amount
of interest payable for any period less than a full interest period shall be
computed on the basis of a 360-day year of twelve 30-day months and the actual
days elapsed in a partial month in such period. The amount of interest payable
for any full interest period shall be computed by dividing the applicable rate
per annum by two. The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest installment, which shall be the February 15 or August 15 (whether or
not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee (notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date) or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture.
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 Security, from time to
time to defer the payment of interest on this Security for up to 10 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, and
at the end of which the Company shall pay all interest then accrued and unpaid
including Additional Interest, as provided below; provided, however, that no
Extension Period shall extend beyond the Stated Maturity of the principal of
this Security and no such Extension Period may end on a date other than an
Interest Payment Date; and provided, further, however, that, during any such
Extension Period the Company shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Company's capital 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 in all respects with or
junior in interest to this Security (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or shareholder stock purchase plan or in
connection with the issuance of capital stock of the Company (or securities
convertible into or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to the applicable Extension Period,
(b) as a result of an exchange or conversion of any class or series of the
Company's capital stock (or any capital stock of a Subsidiary of the Company)
for any class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any Rights Plan, or the issuance of rights, stock or
other property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock). Prior
to the termination of any such Extension Period, the Company may further defer
the payment of interest, provided that no Extension Period shall exceed 10
consecutive semi-annual interest payment periods, extend beyond the Stated
Maturity of the principal of this Security or end on a date other than an
Interest Payment Date. Upon the termination of any such Extension Period and
upon the payment of all accrued and unpaid interest and any Additional Interest
then due on any Interest Payment Date, the Company may elect to begin a new
Extension Period, subject to the above conditions. No interest shall be due and
payable during an Extension Period, except at the end thereof, but each
installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent that the
payment of such interest shall be legally enforceable) at the rate of 8.05% per
annum, compounded semiannually and calculated as set forth in the first
paragraph of this Security, from the date on which such amounts would otherwise
have been due and payable until paid or made available for payment. The Company
shall give the Holder of this Security and the Trustee notice of its election to
begin any Extension Period at least one Business Day prior to the next
succeeding Interest Payment Date on which interest on this Security would be
payable but for such deferral or, so long as such securities are held by FCB/NC
Capital Trust I (the "Issuer Trust"), at least one Business Day prior to the
earlier of (i) the next succeeding date on which Distributions on the Capital
Securities of such Issuer Trust would be payable but for such deferral, and (ii)
the date on which the Property Trustee of such Issuer Trust is required to give
notice to holders of such Capital Securities of the record date or the date such
Distributions are payable, but in any event not less than one Business Day prior
to such record date.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; provided, however, that, at the option of the Company, payment of
interest may be made (i) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Securities Register, or (ii) if to a
Holder of $1,000,000 or more in aggregate principal amount of this Security, by
wire transfer in immediately available funds upon written request to the Trustee
not later than 15 calendar days prior to the date on which the interest is
payable.
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take such actions as
may be necessary or appropriate to effectuate the subordination so provided, and
(c) appoints the Trustee his or her attorney-in-fact for any and all such
purposes. Each Holder hereof, by his or her acceptance hereof, waives all notice
of the acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred and waives reliance by each such holder upon said provisions.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
FIRST CITIZENS BANCSHARES, INC.
By:_______________________________
Kenneth A. Black
Vice President and Chief
Financial Officer
ATTEST:
- -----------------------------------
Secretary or Assistant Secretary
[SEAL]
This is one of the Securities of the 8.05% Junior Subordinated Deferrable
Interest Debentures series designated therein referred to in the
within-mentioned Indenture.
BANKERS TRUST COMPANY, as Trustee
By:_______________________________
Authorized Signatory
<PAGE>
(Reverse of Security)
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under the Junior Subordinated Indenture, dated as of March 5, 1998
(herein called the "Indenture"), between the Company and Bankers Trust Company,
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Indebtedness and the Holders of the Securities,
and of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the 8.05% Junior Subordinated Deferrable
Interest Debentures (the "Junior Subordinated Debentures") series designated
herein, limited in aggregate principal amount to $____________.
All terms used in this Security that are defined in the Indenture, in the
Amended and Restated Trust Agreement, dated as of March 5, 1998 (as modified,
amended or supplemented from time to time, the "Trust Agreement"), relating to
the Issuer Trust among the Company, as Depositor, the Trustees named therein,
the Administrators named therein and the Holders from time to time of the Trust
Securities issued pursuant thereto, or in the Registration Rights Agreement,
dated as of March 5, 1998 (the "Registration Rights Agreement"), among the
Company, the Issuer Trust and Wheat, First Securities, Inc., shall have the
meanings assigned to them in the Indenture, the Trust Agreement, or the
Registration Rights Agreement, as the case may be.
The Company has the right to redeem this Security (i) on or after March 1,
2008, in whole at any time or in part from time to time, or (ii) in whole (but
not in part), at any time within 90 days following the occurrence and during the
continuation of a Tax Event, Investment Company Event, or Capital Treatment
Event, in each case at the Redemption Price described below, and subject to
possible regulatory approval.
In the case of a redemption on or after March 1, 2008, the Redemption Price
shall equal the following prices, expressed in percentages of the principal
amount hereof, together with accrued interest to but excluding the date fixed
for redemption, if redeemed during the 12-month period beginning March 1:
Year Redemption Price
2008 104.03%
2009 103.62%
2010 103.22%
2011 102.82%
2012 102.42%
2013 102.01%
2014 101.61%
2015 101.21%
2016 100.81%
2017 100.40%
and 100% on or after March 1, 2018.
In the case of a redemption on or after March 1, 2008 following a Tax
Event, Investment Company Event or Capital Treatment Event, the Redemption Price
shall equal the Redemption Price then applicable to a redemption under the
preceding paragraph.
In the case of a redemption prior to March 1, 2008 following a Tax Event,
Investment Company Event or Capital Treatment Event in respect of the Issuer
Trust, the Redemption Price shall equal the Make-Whole Amount for a
corresponding $1,000 principal amount hereof, together with accrued interest to
but excluding the date fixed for redemption, which Make-Whole Amount will be
equal to the greater of (i) 100% of the principal amount hereof, and (ii) as
determined by a Quotation Agent (as defined in the Trust Agreement), the sum of
the present values of the principal amount hereof and premium, if any, payable
as part of the Redemption Price with respect to an optional redemption hereof on
March 1, 2008, together with the present values of scheduled payments of
interest from the Redemption Date to March 1, 2008, in each case discounted to
the Redemption Date on a semi-annual basis (assuming a 360-day year consisting
of 30-day months) at the Adjusted Treasury Rate (as defined in the Trust
Agreement).
In the event of redemption of this Security in part only, a new Security or
Securities of this series for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the cancellation hereof.
The Indenture permits, with certain exceptions as therein provided, the
Company and the Trustee at any time to enter into a supplemental indenture or
indentures for the purpose of modifying in any manner the rights and obligations
of the Company and of the Holders of the Securities, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities of each series to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, if an Event
of Default with respect to the Securities of this series at the time Outstanding
occurs and is continuing, then and in every such case the Trustee or the Holders
of not less than 25% in aggregate principal amount of the Outstanding Securities
of this series may declare the principal amount of all the Securities of this
series to be due and payable immediately, by a notice in writing to the Company
(and to the Trustee if given by Holders), provided that, if upon an Event of
Default, the Trustee or such Holders fail to declare the principal of all the
Outstanding Securities of this series to be immediately due and payable, the
Holders of at least 25% in aggregate Liquidation Amount of the Capital
Securities then outstanding shall have the right to make such declaration 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
Interest) on all the Securities of this series shall become immediately due and
payable, provided that the payment of principal and interest (including any
Additional Interest) on such Securities shall remain subordinated to the extent
provided in Article XIII of the Indenture.
<PAGE>
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest (including Additional Interest) on this Security at the times, place
and 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 Security is registrable in the Securities Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company maintained under Section 10.2 of the Indenture for such
purpose, duly endorsed by, 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 such Holder's attorney duly authorized in writing, and
thereupon one or more new Securities of this series, of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $100,000 and any integral multiple of $1,000 in
excess thereof. Securities or portions thereof may be transferred or exchanged
only in principal amounts of not less than $100,000. Any transfer, exchange or
other disposition of Securities in contravention of Section 3.6(b)(v) of the
Indenture shall be deemed to be void and of no legal effect whatsoever, any such
transferee shall be deemed not to be the Holder or owner of any beneficial
interest in such Securities for any purpose, including but not limited to the
receipt of interest payable on such Securities, and such transferee shall be
deemed to have no interest whatsoever in such Securities. As provided in the
Indenture and subject to certain limitations therein set forth, Securities of
this series are exchangeable for a like aggregate principal amount of Securities
of this series and of like tenor of a different authorized denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agrees that for United States Federal, state and
local tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
THIS SECURITY IS A DIRECT AND UNSECURED OBLIGATION OF THE COMPANY, DOES NOT
EVIDENCE DEPOSITS OF A BANK AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER INSURER OR GOVERNMENT AGENCY.
[LETTERHEAD OF WARD AND SMITH, P.A.]
July __, 1998
First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, N.C. 27604
RE: Our File__________
Ladies and Gentlemen:
We have acted as counsel to First Citizens BancShares, Inc. ("BancShares") in
connection with the preparation of a Registration Statement on Form S-4,
including the form of Prospectus contained therein (the "Registration
Statement"), which has been filed with the Securities and Exchange Commission
under the Securities Act of 1933, as amended (the "Act"), for purposes of
registering under the Act (i) BancShares' issuance and sale to FCB/NC Capital
Trust I (the "Issuer Trust") of up to $150,000,000 in 8.05% Junior Subordinated
Debentures (the "Junior Subordinated Debentures") pursuant to the terms of a
certain Junior Subordinated Indenture dated March 5, 1998 entered into by and
between BancShares and Bankers Trust Company, as Trustee thereunder, in the form
filed as Exhibit 4.3 to the Registration Statement (the "Junior Subordinated
Indenture"), (ii) the issuance and sale by the Issuer Trust of up to
$150,000,000 aggregate liquidation amount of 8.05% Capital Securities (the
"Capital Securities"), and (iii) the issuance by BancShares of its guarantee of
the Capital Securities pursuant to and to the extent provided in a certain
Guarantee Agreement proposed to be entered into by and between BancShares and
Bankers Trust Company, as Guarantee Trustee thereunder, in the form filed as
Exhibit 4.2 to the Registration Statement (the "Guarantee Agreement").
In connection with rendering the opinions set forth in this letter, we have
examined or relied upon copies of the following documents:
1. the Registration Statement and the Prospectus contained
therein;
2. the Junior Subordinated Indenture filed as Exhibit 4.3
to the Registration Statement;
<PAGE>
Southern BancShares (N.C.), Inc.
June 3, 1998
Page 2
3. the form of Junior Subordinated Debentures filed an Exhibit
4.6 to the Registration Statement;
4. the form of Guarantee Agreement filed as Exhibit 4.2 to the
Registration Statement;
In rendering the opinions set forth in this letter, we have also examined the
minutes of proceedings of BancShares' Board of directors and such certificates
of public officials, records and other certificates and instruments as we have
deemed necessary for the purposes of the opinions expressed herein.
In delivering this letter, we have assumed (i) the authenticity of all documents
submitted to us as originals and the conformity to the original or certified
copies of all documents submitted to us as conformed or reproduction copies,
(ii) that the minutes of proceedings of BancShares Board of Directors are
accurate and complete and contain minutes of all actions pertaining to the
Junior Subordinated Indenture, the Junior Subordinated Debentures, the Guarantee
Agreement, and the transactions described therein, (iii) that the final,
executed versions of all relevant documents, including the Junior Subordinated
Debentures and the Guarantee Agreement, will be identical in all material
respects to the versions reviewed by us, and (iv) that the Junior Subordinated
Debentures will be issued and sold on the terms described in the Junior
Subordinated Indenture and the Registration Statement.
Based upon and subject to the foregoing, as well as the qualifications set forth
in subsequent portions of this letter, we are of the opinion as of this date
that, (i) when the Registration Statement has become effective, and upon
compliance with the pertinent provisions of the Act and the Trust Indenture Act
of 1939, as amended, and compliance with the securities or "blue sky" laws of
various jurisdictions in which the Capital Securities will be offered or sold,
(ii) when the Guarantee Agreement has been properly executed and delivered by
BancShares and by the Guarantee Trustee, respectively, and (iii) when the Junior
Subordinated Debentures have been executed, authenticated and delivered in
accordance with the terms of the Junior Subordinated Indenture, then the Junior
Subordinated Debentures and the Guarantee Agreement will be valid, binding and
legal obligations of BancShares.
In rendering the opinions set forth above, we have assumed, without independent
verification, that
1. The parties to the Junior Subordinated Indenture, the Guarantee and the
Junior Subordinated Debentures other than BancShares have the corporate
power and authority to execute, deliver and perform their respective
obligations thereunder;
2. No event will take place subsequent to the date hereof that would cause
any action taken in connection with the Junior Subordinated Indenture,
the Junior Subordinated Debentures, the Guarantee Agreement, or the
transactions described therein to fail to comply with any law, rule,
regulation, order, judgment, decree or duty, or that would permit any
party to cancel, rescind, or otherwise avoid any act;
3. All certificates of public officials have been properly given and are
accurate and complete;
<PAGE>
Southern BancShares (N.C.), Inc.
June 3, 1998
Page 3
4. There has been no mutual mistake of fact, fraud, duress or undue
influence in connection with the Junior Subordinated Indenture, the
Junior Subordinated Debentures, the Guarantee Agreement, or the
transactions described therein, and the conduct of the parties to such
documents has complied with any requirement of good faith, fair dealing
and conscionability;
5. There are no agreements or understandings, or any usage of trade or
course of dealing, among the parties that, in any case, would define,
supplement or qualify the terms of the Junior Subordinated Indenture,
the Junior Subordinated Debentures, the Guarantee Agreement, or the
transactions described therein.
In addition, all opinions and statements set forth in this letter are expressly
limited and qualified as follows:
(1) The opinions expressed herein are limited to matters of North Carolina
law and the federal laws of the United States of America. We point out
that the Junior Subordinated Indenture, the Junior Subordinated
Debentures and the Guarantee Agreement are governed by New York law. We
are not admitted to practice in New York, and we have assumed for
purposes of the opinions expressed herein that the laws of such other
jurisdiction conform to the laws of North Carolina.
(2) Our opinions are limited to the matters expressly stated herein, and no
opinion may be inferred or implied beyond the matters expressly stated.
(3) The enforceability of all or various provisions of the Junior
Subordinated Indenture, the Junior Subordinated Debentures and the
Guarantee Agreement may be limited by (i) the effect of applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws from
time to time in effect relating to or limiting the enforcement of
creditors' rights generally, (ii) general principles of equity and
applicable laws or court decisions limiting the availability of
specific performance, injunctive relief and other equitable remedies,
and (iii) federal and/or state bank holding company, commercial bank,
savings bank, thrift institution and deposit insurance laws and
regulations, and the application of principles of public policy
underlying such laws and regulations.
(4) We express no opinion herein as to the enforceability of any choice of
law or indemnification provisions contained in the Junior Subordinated
Indenture, the Junior Subordinated Debentures or the Guarantee
Agreement.
(5) Except as otherwise expressly specified herein, the opinions herein are
limited to matters in existence as of the date hereof, and we undertake
no responsibility to revise or supplement this letter or the opinions
herein to reflect any change in the law or facts.
<PAGE>
Southern BancShares (N.C.), Inc.
June 3, 1998
Page 4
We consent to the filing of this opinion as an exhibit to the Registration
Statement. We also consent to the reference to Ward and Smith, P.A. under the
caption "Legal Matters" in the Registration Statement.
Yours truly,
/s/ WARD AND SMITH, P.A.
EXHIBIT 5.2
[Letterhead of Richards, Layton & Finger, P.A.]
July __, 1998
FCB/NC Capital Trust I
c/o First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, North Carolina 27604
Re: FCB/NC Capital Trust I
Ladies and Gentlemen:
We have acted as special Delaware counsel for First Citizen
BancShares, Inc., a Delaware corporation (the "Company"), and FCB/NC Capital
Trust I, 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 February 27,
1998 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on February 27, 1998;
(b) The Trust Agreement of the Trust, dated as of February 27,
1998, by and between the Company, as depositor, and the trustee of the Trust
named therein;
(c) The Amended and Restated Trust Agreement of the Trust,
dated as of March 5, 1998 (including Exhibits A, C and D thereto) (the "Trust
Agreement"), by and among the Company, 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;
<PAGE>
FCB/NC Capital Trust I
July __, 1998
Page 2
(d) The Registration Statement on Form S-4 (the "Registration
Statement"), including a preliminary prospectus (the "Prospectus"), relating to
the 8.05% Capital Securities of the Trust representing undivided beneficial
interests in the assets of the Trust (each, a "Capital Security" and
collectively, the "Capital Securities"), to be exchanged for outstanding 8.05%
Capital Securities of the Trust, as proposed to be filed by the Company and the
Trust with the Securities and Exchange Commission on or about July __, 1998; and
(e) A Certificate of Good Standing for the Trust, dated July
__, 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.
<PAGE>
For purposes of this opinion, we have assumed (i) that the
Trust Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation and termination of the Trust, and 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 Capital Security is to be issued by the Trust (collectively, the "Capital
Security Holders") of a Capital Securities Certificate, in accordance with the
Trust Agreement, and as described in the Registration Statement, and (vii) that
the Capital Securities are issued to the Capital Security Holders in accordance
with the Trust Agreement, and as described in the Registration Statement. We
have not participated in the preparation of the Registration Statement and
assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business Trust Act.
2. The Capital Securities will represent valid and, subject to
the qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Capital 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 Capital 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
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/ Richard, Layton & Finger, P.A.
BJK/BJ
EXHIBIT 8.1
[Hunton & Williams Letterhead]
July 13, 1998
First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, North Carolina 27604
FCB/NC CAPITAL TRUST I--EXCHANGE OFFER
CERTAIN FEDERAL INCOME TAX MATTERS
Ladies and Gentlemen:
We have acted as special tax counsel to First Citizens BancShares, Inc.
(the "Company") and FCB/NC Capital Trust I (the "Issuer Trust") in connection
with the preparation of a Registration Statement on Form S-4 (the "Registration
Statement") for the registration under the Securities Act of 1933, as amended
(the "Act"), of (1) up to $150 million aggregate liquidation amount of the
Issuer Trust's 8.05% Capital Securities (the "New Capital Securities"), (2) up
to $150 million aggregate principal amount of the Company's 8.05% Junior
Subordinated Deferrable Interest Debentures due March 1, 2028 (the "New
Debentures"), and (3) the Company's related Guarantee of Capital Securities (the
"New Guarantee"). The New Capital Securities, the New Debentures, and the New
Guarantee are to be issued in order to effect the exchange of New Capital
Securities for a like liquidation amount of the Issuer Trust's outstanding 8.05%
Capital Securities.
We have reviewed copies of (1) the Registration Statement, including
the prospectus included therein (the "Prospectus"), and (2) such other documents
as we have considered necessary or appropriate as a basis for the opinion set
forth below. We have also relied upon, and assumed the accuracy of, certain
written representations made to us by the Company. We have further assumed (i)
that all documents submitted to us as originals are authentic, (ii) with respect
to all documents supplied to us as drafts, that the final, executed versions of
such documents are identical in all material respects to the versions most
recently supplied to us, and (iii) that each such final version (when executed)
is valid and enforceable in accordance with its terms.
<PAGE>
First Citizens BancShares, Inc.
July 13, 1998
Page 2
Based on the foregoing, we confirm that the statements of law and legal
conclusions contained in the Prospectus under the caption "Certain Federal
Income Tax Consequences" constitute our opinion, subject to the assumptions,
conditions, and limitations described therein, and that the discussion
thereunder does not omit any material provision with respect to the matters
covered.
Our representation of the Company in connection with the New Capital
Securities is limited solely to that of special tax counsel and, except for our
opinion as to certain federal income tax matters as set forth in the preceding
paragraph, we express no opinion on any tax or other legal matter. This opinion
is solely for your benefit and may not be distributed to or relied upon by any
other person without our prior written consent. We do not undertake to advise
you of any changes in our opinion expressed herein (or under the caption
"Certain Federal Income Tax Consequences" in the Prospectus) resulting from
matters that might hereafter arise or be brought to our attention.
We consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the references to Hunton & Williams
under the captions "Certain Federal Income Tax Consequences" and "Legal Matters"
in the Prospectus. In giving this consent, we do not admit that we are in the
category of persons whose consent is required by Section 7 of the Act or the
rules and regulations promulgated thereunder by the Securities and Exchange
Commission.
Very truly yours,
HUNTON & WILLIAMS
<PAGE>
First Citizens BancShares, Inc.
July 13, 1998
Page 3
Exhibit 12.1
First Citizens BancShares, Inc.
Statement Re Computation of Ratios of Earnings to Fixed Charges
<TABLE>
<CAPTION>
<S> <C>
Three Months
Ended March 31,
--------------------------------
1998 1997
---- ----
RATIO OF EARNINGS TO FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS:
Net income $ 15,660 16,592
Income taxes 8,844 9,404
--------------------------------
Income before income taxes (a) 24,504 25,996
--------------------------------
Interest expense 71,447 61,706
Less: interest on deposits 63,874 57,377
--------------------------------
Fixed charges, excluding interest on deposits (b) $ 7,573 4,329
--------------------------------
Ratio of earnings to fixed charges
excluding interest on deposits [(a)+(b)]/(b) 4.24x 7.01x
====== ======
Year Ended December 31,
------------------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
RATIO OF EARNINGS TO FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS:
Net income 70,558 65,467 56,906 50,969 55,585
Income taxes 39,492 36,207 30,423 26,867 28,641
------------------------------------------------------------
Income before income taxes (a) 110,050 101,674 87,329 77,836 84,226
------------------------------------------------------------
Interest expense 268,013 248,250 224,664 148,126 137,934
Less: interest on deposits 243,749 230,905 207,234 137,292 130,354
------------------------------------------------------------
Fixed charges, excluding interest on deposits (b) 24,264 17,345 17,430 10,834 7,580
------------------------------------------------------------
Ratio of earnings to fixed charges
excluding interest on deposits [(a)+(b)]/(b) 5.54x 6.86x 6.01x 8.18x 12.11x
====== ====== ====== ====== ======
Three Months
Ended March 31,
--------------------------------
1998 1997
---- ----
RATIO OF EARNINGS TO FIXED CHARGES
INCLUDING INTEREST ON DEPOSITS:
Net income $ 15,660 16,592
Income taxes 8,844 9,404
---------------------------------
Income before income taxes (a) 24,504 25,996
---------------------------------
Fixed charges (interest expense) (b) 71,447 61,706
---------------------------------
Ratio of earnings to fixed charges
including interest on deposits [(a)+(b)]/(b) 1.34x 1.42x
====== ======
Year Ended December 31,
------------------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
RATIO OF EARNINGS TO FIXED CHARGES
INCLUDING INTEREST ON DEPOSITS:
Net income 70,558 65,467 56,906 50,969 55,585
Income taxes 39,492 36,207 30,423 26,867 28,641
-----------------------------------------------------------
Income before income taxes (a) 110,050 101,674 87,329 77,836 84,226
-----------------------------------------------------------
Fixed charges (interest expense) (b) 268,013 248,250 224,664 148,126 137,934
-----------------------------------------------------------
Ratio of earnings to fixed charges
including interest on deposits [(a)+(b)]/(b) 1.41x 1.41x 1.39x 1.53x 1.61x
====== ====== ====== ====== =====
</TABLE>
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
First Citizens BancShares, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Raleigh, North Carolina
July 14, 1998
EXHIBIT 24.1
POWER OF ATTORNEY
WITNESSETH, that each of the undersigned directors of FIRST CITIZENS
BANCSHARES, INC. ("BancShares"), a Delaware corporation, by his or her execution
hereof, hereby constitutes and appoints JAMES B. HYLER, JR., FRANK B. HOLDING,
JR. and KENNETH A. BLACK, and each of them, as his or her true and lawful
attorneys-in-fact and agents, for him or her, and in his or her name, place and
stead, to execute and sign the Registration Statement on Form S-4 to be filed by
BancShares and FCB/NC Capital Trust I (the "Issuer Trust") with the Securities
and Exchange Commission (the "Commission") pursuant to the Securities Act of
1933, as amended, with respect to the Issuer Trust's New Capital Securities,
BancShares' New Junior Subordinated Debentures, and BancShares' New Guarantee of
the New Capital Securities, and, further, to execute and sign any and all
pre-effective and post-effective amendments to such Registration Statement, and
file all of the same, together with all exhibits and schedules thereto and all
other documents in connection therewith, with the Commission and with such state
securities authorities as may be appropriate, granting unto said
attorneys-in-fact, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, and hereby ratifying and confirming all the acts of said
attorneys-in-fact and agents, or any of them, which they may lawfully do in the
premises or cause to be done by virtue hereof.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C>
S/ John M. Alexander, Jr. Director April__27__, 1998
- ----------------------------------------------------------
John M. Alexander, Jr.
S/ Ted L. Bissett Director April __27__, 1998
- ----------------------------------------------------------------
Ted L. Bissett
S/ B. Irvin Boyle Director April __ 27__, 1998
- ----------------------------------------------------------------
B. Irvin Boyle
S/ George H. Broadrick Director April__27__, 1998
- ----------------------------------------------------------
George H. Broadrick
S/ Hubert M. Craig, III Director April __27__, 1998
- ------------------------------------------------------------
Hubert M. Craig, III
S/ Betty M. Farnsworth Director April__27__, 1998
- ----------------------------------------------------------
Betty M. Farnsworth
S/ Lewis M. Fetterman Director April__27__, 1998
- ----------------------------------------------------------
Lewis M. Fetterman
<PAGE>
S/ Carmen P. Holding Director April__27__, 1998
- -----------------------------------------------------------
Carmen P. Holding
S/ Frank B. Holding Executive Vice Chairman April__27__, 1998
- ------------------------------------------------------------
Frank B. Holding
S/ Frank B. Holding, Jr. Director April__27__, 1998
- ------------------------------------------------------------
Frank B. Holding, Jr.
S/ Lewis R. Holding Chairman April__27__, 1998
- ------------------------------------------------------------
Lewis R. Holding
S/ Charles B. C. Holt Director April__27__, 1998
- -------------------------------------------------------------
Charles B. C. Holt
S/ Edwin A. Hubbard Director April__27__, 1998
- ----------------------------------------------------------
Edwin A. Hubbard
S/ James B. Hyler, Jr. Vice Chairman April __27__, 1998
- -------------------------------------------------------------
James B. Hyler, Jr.
S/ Gale D. Johnson Director April__27__, 1998
- -------------------------------------------------------------
Gale D. Johnson
S/ Freeman R. Jones Director April__27__, 1998
- ------------------------------------------------------------
Freeman R. Jones
S/ Lucius S. Jones Director April __27__, 1998
- ---------------------------------------------------------------
Lucius S. Jones
S/ Joseph T. Maloney, Jr. Director April__27__, 1998
- ----------------------------------------------------------
Joseph T. Maloney, Jr.
S/ J. Claude Mayo, Jr. Director April__27__, 1998
- -------------------------------------------------------------
J. Claude Mayo, Jr.
S/ William McKay Director April__27__, 1998
- -----------------------------------------------------------
William McKay
S/ Brent D. Nash Director April __27__, 1998
- --------------------------------------------------------------
Brent D. Nash
S/ Lewis T. Nunnelee, II Director April__27__, 1998
- ----------------------------------------------------------
Lewis T. Nunnelee, II
S/ Talbert O. Shaw Director April__27__, 1998
- -------------------------------------------------------------
Talbert O. Shaw
S/ R. C. Soles, Jr. Director April __27__, 1998
- ----------------------------------------------------------------
R. C. Soles, Jr.
S/ David L. Ward, Jr. Director April__27__, 1998
- ------------------------------------------------------------
David L. Ward, Jr.
</TABLE>
- --------------------------------------------------------------------------------
UNITED STATES
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) ___________
------------------------------
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
Bankers Trust Company
Legal Department
130 Liberty Street, 31st Floor
New York, New York 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
---------------------------------
<TABLE>
<S> <C>
FIRST CITIZENS BANCSHARES, INC. FCB/NC CAPITAL TRUST I
(Exact name of obligor as specified in its charter) (Exact name of Co-Registrant as specified
in its charter)
DELAWARE 56-1528994 DELAWARE 56-6507188
(State or other jurisdiction of (I.R.S. employer (State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.) Incorporation or organization) Identification no.)
c/o FIRST CITIZENS BANCSHARES, INC.
3128 Smoketree Court 3128 Smoketree Court
Raleigh, North Carolina 27604 Raleigh, North Carolina 27604
(Address, including zip code (Address, including zip code
of principal executive offices) of principal executive offices)
</TABLE>
New Capital Securities of FCB/NC Capital Trust
I New Junior Subordinated Debentures due March 1, 2028 of First
Citizens BancShares, Inc.
Guarantee of Capital Securities by First Citizens BancShares, Inc.
(Title of the indenture securities)
Item 1. General Information.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising
authority to which it is subject.
Name Address
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the Trustee, describe each
such affiliation.
None.
Item 3. -15. Not Applicable
Item 16. List of Exhibits.
Exhibit 1 - Restated Organization Certificate of
Bankers Trust Company dated August 7, 1990,
Certificate of Amendment of the Organization
Certificate of Bankers Trust Company dated
June 21, 1995 - Incorporated herein by
reference to Exhibit 1 filed with Form T-1
Statement, Registration No. 33-65171
Certificate of Amendment of the Organization
Certificate of Bankers Trust Company dated
March 20, 1996
Incorporated herein by referenced to
Exhibit 1 filed with Form T-1 Statement,
Registration No. 333-25843
Certificate of Amendment of the Organization
Certificate of Bankers Trust Company
dated June 19, 1997 - Copy attached.
Exhibit 2 - Certificate of Authority to commence
business - Incorporated herein by reference
to Exhibit 2 filed with Form T-1 Statement,
Registration No. 33-21047.
Exhibit 3 - Authorization of the Trustee to exercise
corporate trust powers Incorporated herein
by reference to Exhibit 2 filed with Form
T-1 Statement, Registration No. 33-21047.
Exhibit 4 - Existing By-Laws of Bankers Trust
Company, as amended on November 18, 1997-
Copy attached.
-2-
<PAGE>
Exhibit 5 - Not applicable.
Exhibit 6 - Consent of Bankers Trust Company
required by Section 321(b) of the Act.
Incorporated herein by reference to Exhibit
4 filed with Form T-1 Statement,
Registration No. 22-18864.
Exhibit 7 - The latest report of condition of Bankers
Trust Company dated as of March 31,
1998. Copy attached.
Exhibit 8 - Not Applicable.
Exhibit 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 10th day
of July, 1998.
BANKERS TRUST COMPANY
By: s/ Sandra J. Shaffer
-----------------------------------
Sandra J. Shaffer
Assistant Vice President
-4-
EXHIBIT 1
State of New York,
Banking Department
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New
York, DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF
AMENDMENT OF THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY Under Section
8005 of the Banking Law," dated June 19, 1997, providing for an increase in
authorized capital stock from $1,601,666,670 consisting of 100,166,667 shares
with a par value of $10 each designated as Common Stock and 600 shares with a
par value of $1,000,000 each designated as Series Preferred Stock to
$2,001,666,670 consisting of 100,166,667 shares with a par value of $10 each
designated as Common Stock and 1,000 shares with a par value of $1,000,000 each
designated as Series Preferred Stock.
Witness, my hand and official seal of the Banking Department at the City of
New York, this 27th day of June in the Year of our Lord one thousand nine
hundred and ninety-seven.
Manuel Kursky
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
-----------------------------
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into
One Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred
Sixty-Seven (100,166,667) shares with a par value of $10 each
designated as Common Stock and 600 shares with a par value of One
Million Dollars ($1,000,000) each designated as Series Preferred
Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred
Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 1000 shares with a par value of One Million Dollars
($1,000,000) each designated as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was
authorized by unanimous written consent signed by the holder of all outstanding
shares entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this
19th day of June, 1997.
James T. Byrne, Jr.
--------------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
--------------------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an
Assistant Secretary of Bankers Trust Company, the corporation described in the
foregoing certificate; that she has read the foregoing certificate and knows the
contents thereof, and that the statements herein contained are true.
Lea Lahtinen
--------------------
Lea Lahtinen
Sworn to before me this 19th day of June, 1997.
Sandra L. West
-------------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
EXHIBIT 4
BY-LAWS
NOVEMBER 18, 1997
Bankers Trust Company
New York
<PAGE>
BY-LAWS
of
Bankers Trust Company
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board of
Directors or any Committee thereof may participate in a meeting of the Board of
Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or
re-elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board of
Directors may be filled by the affirmative vote of a majority of the directors
then in office, and the directors so elected shall hold office for the balance
of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time to
time on the third Tuesday of the month. If the day appointed for holding such
regular meetings shall be a legal holiday, the regular meeting to be held on
such day shall be held on the next business day thereafter. Special meetings of
the Board of Directors may be called upon at least two day's notice whenever it
may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall conduct
the annual directors' examinations of the Company as required by the New York
State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a Chairman
of the Board and a Chief Executive Officer; and shall also elect a President,
and may also elect a Senior Vice Chairman, one or more Vice Chairmen, one or
more Executive Vice Presidents, one or more Senior Managing Directors, one or
more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of Directors
may require any and all officers and employees to give security for the faithful
performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer of
the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these
By-Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records and
premises of the Company and shall delegate such authority to his subordinates.
He shall have the duty to report to the Audit Committee on all matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company which he deems advisable or which the Audit Committee
may request. Additionally, the General Auditor shall have the duty of reporting
independently of all officers of the Company to the Audit Committee at least
quarterly on any matters concerning the internal audit program and the adequacy
of the system of internal controls of the Company that should be brought to the
attention of the directors except those matters responsibility for which has
been vested in the General Credit Auditor. Should the General Auditor deem any
matter to be of special immediate importance, he shall report thereon forthwith
to the Audit Committee. The General Auditor shall report to the Chief Financial
Officer only for administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018 of
the New York Banking Law, indemnify any person who is or was made, or threatened
to be made, a party to an action or proceeding, whether civil or criminal,
whether involving any actual or alleged breach of duty, neglect or error, any
accountability, or any actual or alleged misstatement, misleading statement or
other act or omission and whether brought or threatened in any court or
administrative or legislative body or agency, including an action by or in the
right of the Company to procure a judgment in its favor and an action by or in
the right of any other corporation of any type or kind, domestic or foreign, or
any partnership, joint venture, trust, employee benefit plan or other
enterprise, which any director or officer of the Company is servicing or served
in any capacity at the request of the Company by reason of the fact that he, his
testator or intestate, is or was a director or officer of the Company, or is
serving or served such other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise in any capacity, against judgments,
fines, amounts paid in settlement, and costs, charges and expenses, including
attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the President, and (ii) only if and to the extent that, after making
such efforts as the Chairman of the Board, the Chief Executive Officer or the
President shall deem adequate in the circumstances, such person shall be unable
to obtain indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement of
expense pursuant to this Article V (i) is a contract right pursuant to which the
person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, Marc Parilla, Assistant Secretary of Bankers Trust Company, New York, New
York, hereby certify that the foregoing is a complete, true and correct copy of
the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
s/ Marc Parilla
--------------------------
ASSISTANT SECRETARY
DATED: June 9, 1998
EXHIBIT 7
<TABLE>
<S> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 03/31/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / / / / / / / |
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin (1) ........... | 0081 1,458,000 |1.a.
b. Interest-bearing balances (2) .................................... | 0071 2,253,000 |1.b.
2. Securities: | / / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....... | 1754 0 |2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...... | 1773 6,444,000 |2.b.
3. Federal funds sold and securities purchased under agreements to resell.... | 1350 30,836,000 |3.
4. Loans and lease financing receivables: | / / / / / / /
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 19,993,000 | / / / / / / / |4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 647,000 | / / / / / / / |4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / |4.c.
d. Loans and leases, net of unearned income, | / / / / / / / |
allowance, and reserve (item 4.a minus 4.b and 4.c) ............... | 2125 19,346,000 |4.d.
5. Trading Assets (from schedule RC-D) .................................... | 3545 45,690,000 |5.
6. Premises and fixed assets (including capitalized leases) ................ | 2145 791,000 |6.
7. Other real estate owned (from Schedule RC-M) ............................ | 2150 184,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M)..................................................... | 2130 104,000 |8.
9. Customers' liability to this bank on acceptances outstanding ............ | 2155 542,000 |9.
10. Intangible assets (from Schedule RC-M) ................................... | 2143 81,000 |10.
11. Other assets (from Schedule RC-F) ........................................ | 2160 5,339,000 |11.
12. Total assets (sum of items 1 through 11) ................................. | 2170 113,068,000 |12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<TABLE>
<S> <C>
Legal Title of Bank: Bankers Trust Company Call Date: 03/31/98 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Schedule RC--Continued _____________________________
Dollar Amounts in Thousands | / / / / / / / / Bil Mil Thou __|
LIABILITIES | / / / / / / / / / / / / / / / / / / / / /|
13. Deposits: | / / / / / / / / / / / / / / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I | RCON 2200 26,465,000 |13.a.
(1) Noninterest-bearing(1) .................... RCON 6631 3,005,000.........| / / / / / / / / |13.a.(1)
(2) Interest-bearing ............................RCON 6636 23,460,000........ | / / / / / / / / / / / / |13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E| / / / / / / / / / / / / / / / |
part II) | RCFN 2200 21,993,000 |13.b.
(1) Noninterest-bearing .........................RCFN 6631 1,712,000 | / / / / / / / / / / / |13.b.(1)
(2) Interest-bearing .................RCFN 6636 20,281,000 | / / / / / / / / / / / |13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 12,125,000 |14.
15. a. Demand notes issued to the U.S. Treasury ........................... | RCON 2840 0 |15.a.
b. Trading liabilities (from Schedule RC-D).......................... | RCFD 3548 25,701,000 |15.b.
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): | / / / / / / / / / / |
a. With a remaining maturity of one year or less ................... | RCFD 2332 6,773,000 |16.a.
b. With a remaining maturity of more than one year through three years.. | A547 3,754,000 |16.b.
c. With a remaining maturity of more than three years................. | A548 2,212,000 |16.c
17. Not Applicable. | / / / / / / / / / / / / / / / / / / |17.
18. Bank's liability on acceptances executed and outstanding ................ | RCFD 2920 542,000 |18.
19. Subordinated notes and debentures (2).................................... | RCFD 3200 1,308,000 |19.
20. Other liabilities (from Schedule RC-G) .................................. | RCFD 2930 6,135,000 |20.
21. Total liabilities (sum of items 13 through 20) .......................... | RCFD 2948 107,008,000 |21.
22. Not Applicable |/ / / / / / / / / / / / / /
|/ / / / / / / / / / / / / /|22.
EQUITY CAPITAL | / / / / / / / / / / / / / |
23. Perpetual preferred stock and related surplus ........................... | RCFD 3838 1,000,000 |23.
24. Common stock ............................................................ | RCFD 3230 1,352,000 |24.
25. Surplus (exclude all surplus related to preferred stock) ................ | RCFD 3839 544,000 |25.
26. a. Undivided profits and capital reserves ............................. | RCFD 3632 3,583,000 |26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities | RCFD 8434 ( 41,000)|26.b.
27. Cumulative foreign currency translation adjustments ..................... | RCFD 3284 ( 378,000)|27.
28. Total equity capital (sum of items 23 through 27) ....................... | RCFD 3210 6,060,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)............ | RCFD 3300 113,068,000 |29
=
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1997 ........................... | RCFD 6724 1 | M.1
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank
with generally accepted auditing standards by a certified performed by other external auditors
public accounting firm which submits a report on the bank (may be required by state chartering
2 = Independent audit of the bank's parent holding company authority)
conducted in accordance with generally accepted auditing 5 = Review of the bank's financial statements
standards by a certified public accounting firm which by external auditors
submits a report on the consolidated holding company 6 = Compilation of the bank's financial
(but not on the bank separately) statements by external auditors
3 = Directors' examination of the bank conducted in 7 = Other audit procedures
accordance with generally accepted auditing standards (excluding tax preparation work)
by a certified public accounting firm (may be required by 8 = No external audit work
state chartering authority)
</TABLE>
- ---------------
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
FCB/NC CAPITAL TRUST I
LETTER OF TRANSMITTAL
OFFER TO EXCHANGE ITS NEWLY ISSUED 8.05% CAPITAL SECURITIES (LIQUIDATION
AMOUNT $1,000 PER CAPITAL SECURITY) WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 FOR ANY AND ALL OF ITS OUTSTANDING 8.05% CAPITAL
SECURITIES (LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY) PURSUANT TO THE
PROSPECTUS DATED ______.
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON __________, 1998, UNLESS THE OFFER IS EXTENDED. TENDERS MAY BE
WITHDRAWN PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
BANKERS TRUST COMPANY
<TABLE>
<CAPTION>
By Mail: By Hand: By Overnight Mail:
<S> <C>
BT Services Tennessee, Inc. Bankers Trust Company BT Services Tennessee, Inc
Corporate Trust and Agency Group Corporate Trust and Agency Group Corporate Trust and Agency Group
Reorganization Unit Receipt and Delivery Window Reorganization Unit
P.O. Box 292737 123 Washington Street, 1st Floor 648 Grassmere Park Road
Nashville, TN 37229-2737 New York, NY 10006 Nashville, TN 37211
</TABLE>
For Information Call:
(800) 735-7777
Confirm: (615) 835-3572
Facsimile: (615) 835-3701
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS
OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF
TRANSMITTAL VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE DOES
NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER
OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS
COMPLETED.
CAPITALIZED TERMS USED BUT NOT DEFINED HEREIN SHALL HAVE
THE SAME MEANING GIVEN THEM IN THE PROSPECTUS (AS DEFINED BELOW). YOU ARE
ENCOURAGED TO REVIEW THE SECTION ENTITLED "CERTAIN DEFINED TERMS" IN THE
PROSPECTUS.
The undersigned acknowledges that he or she has received the
Prospectus, dated ________, 1998 (as the same may be amended or supplemented
from time to time, the "Prospectus"), of First Citizens BancShares, Inc., a
Delaware corporation (the "Company"), and FCB/NC Capital Trust I, a Delaware
business trust (the "Issuer Trust"), and this Letter of Transmittal, which
together constitute the Company's and the Issuer Trust's offer (the "Exchange
Offer") to exchange an aggregate Liquidation Amount of up to $150,000,000 of
the Issuer Trust's 8.05% Capital Securities issued on March 5, 1998 (the "Old
Capital Securities") for a like aggregate Liquidation Amount of the Issuer
Trust's newly issued 8.05% Capital Securities (the "New Capital Securities")
which have been registered under the Securities Act of 1933 (the "Securities
Act").
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY
BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
Holders of Old Capital Securities whose certificates (the
"Certificates") for such Old Capital Securities are not immediately available
or who cannot deliver their Certificates and all other required documents
to the Exchange Agent on or prior to the Expiration Date (as defined in the
Prospectus) or who cannot complete the procedures for book-entry transfer on
a timely basis, must tender their Old Capital Securities according to the
guaranteed delivery procedures set forth in "The Exchange Offer -- Procedure
for Tendering Old Capital Securities" in the Prospectus.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO
THE EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE
ACCOMPANYING INSTRUCTIONS CAREFULLY.
The undersigned has completed the appropriate boxes below
and signed this Letter of Transmittal to indicate the action the undersigned
desires to take with respect to the Exchange Offer.
ALL TENDERING HOLDERS COMPLETE THIS BOX
DESCRIPTION OF OLD CAPITAL SECURITIES TENDERED
<TABLE>
<CAPTION>
Name(s) and Address(es) of Certificate Number(s)* Aggregate Liquidation Liquidation Amount of Old
Registered Holder(s) (Please Amount of Old Capital Capital Securities
Fill in, if Blank) Securities Held Tendered (If Less Than
All)**
<S> <C>
- ------------------------------ ---------------------------- --------------------------- ----------------------------
$
- ------------------------------ ---------------------------- --------------------------- ----------------------------
$
- ------------------------------ ---------------------------- --------------------------- ----------------------------
$
- ------------------------------ ---------------------------- --------------------------- ----------------------------
Total Amount Tendered: $
- --------------------------------------------------------------------------------------------------------------------
* Need not be completed by book-entry holders.
**Old Capital Securities may be tendered in whole or in part in aggregate
liquidation amounts of $100,000 and integral multiples of $1,000 in excess
thereof, provided that if any Old Capital Securities are tendered for exchange
in part, the untendered aggregate liquidation amount thereof must be $100,000 or
any integral multiple of $1,000 in excess thereof. All Old Capital Securities
held shall be deemed tendered unless a lesser number is specified in this
column.
</TABLE>
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY BOOK-
ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND
COMPLETE THE FOLLOWING:
Name of Tendering Institution: -------------------------------------------------
DTC Account Number:-------------------------------------------------------------
Transaction Code Number:--------------------------------------------------------
[ ] CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF
TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE
FOLLOWING:
Name of Registered Holders(s):--------------------------------------------------
Window Ticket Number (if any):--------------------------------------------------
Date of Execution of Notice of Guaranteed Delivery:-----------------------------
Name of Institution which Guaranteed Delivery:----------------------------------
If Guaranteed Delivery is to be made By Book-Entry Transfer:
Name of Tendering Institution:--------------------------------------------------
DTC Account Number:-------------------------------------------------------------
Transaction Code Number:--------------------------------------------------------
[ ] CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY BOOK-
ENTRY TRANSFER AND NON-EXCHANGED OLD CAPITAL SECURITIES ARE TO BE RETURNED BY
CREDITING THE DTC ACCOUNT NUMBER SET FORTH ABOVE.
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING
ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name: --------------------------------------------------------------------------
Address:------------------------------------------------------------------------
Telephone No.:------------------------------------------------------------------
<PAGE>
LADIES AND GENTLEMEN:
Upon the terms and subject to the conditions of the Exchange
Offer, the undersigned hereby tenders to the Company and the Issuer Trust the
above described aggregate Liquidation Amount of Old Capital Securities in
exchange for a like aggregate Liquidation Amount of New Capital Securities.
Subject to and effective upon the acceptance for exchange of
all or any portion of the Old Capital Securities tendered herewith in accordance
with the terms and conditions of the Exchange Offer (including, if the Exchange
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to or upon the
order of the Issuer Trust all right, title and interest in and to such Old
Capital Securities as are being tendered herewith. The undersigned hereby
irrevocably constitutes and appoints the Exchange Agent as its agent and
attorney-in-fact (with full knowledge that the Exchange Agent is also acting as
agent of the Company and the Issuer Trust in connection with the Exchange Offer)
with respect to the tendered Old Capital Securities, with full power of
substitution (such power of attorney being deemed to be an irrevocable power
coupled with an interest), subject only to the right of withdrawal described in
the Prospectus, to: (i) deliver Certificates for Old Capital Securities to the
Company or the Issuer Trust together with all accompanying evidences of transfer
and authenticity to, or upon the order of, the Issuer Trust, upon receipt by the
Exchange Agent, as the undersigned's agent, of the New Capital Securities to be
issued in exchange for such Old Capital Securities; (ii) present Certificates
for such Old Capital Securities for transfer, and to transfer the Old Capital
Securities on the books of the Issuer Trust; and (iii) receive for the account
of the Issuer Trust all benefits and otherwise exercise all rights of beneficial
ownership of such Old Capital Securities, all in accordance with the terms and
conditions of the Exchange Offer.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE
UNDERSIGNED HAS FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND
TRANSFER THE OLD CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE
ACCEPTED FOR EXCHANGE, THE ISSUER TRUST WILL ACQUIRE GOOD, MARKETABLE AND
UNENCUMBERED TITLE THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES
AND ENCUMBRANCES, AND THAT THE OLD CAPITAL SECURITIES TENDERED HEREBY ARE NOT
SUBJECT TO ANY ADVERSE CLAIMS OR PROXIES. THE UNDERSIGNED WILL, UPON REQUEST,
EXECUTE AND DELIVER ANY ADDITIONAL DOCUMENTS DEEMED BY THE COMPANY, THE ISSUER
TRUST OR THE EXCHANGE AGENT TO BE NECESSARY OR DESIRABLE TO COMPLETE THE
EXCHANGE, ASSIGNMENT AND TRANSFER OF THE OLD CAPITAL SECURITIES TENDERED HEREBY,
AND THE UNDERSIGNED WILL COMPLY WITH ITS OBLIGATIONS UNDER THE REGISTRATION
RIGHTS AGREEMENT. THE UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE
EXCHANGE OFFER.
The name(s) and address(es) of the registered holder(s) of the
Old Capital Securities tendered hereby should be printed above, if they are not
already set forth above, as they appear on the Certificates representing such
Old Capital Securities. The Certificate number(s) and the Old Capital
Securities that the undersigned wishes to tender should be indicated in the
appropriate boxes above.
If any tendered Old Capital Securities are not exchanged
pursuant to the Exchange Offer for any reason, or if Certificates are submitted
for more Old Capital Securities than are tendered or accepted for exchange,
Certificates for such nonexchanged or nontendered Old Capital Securities will be
returned (or, in the case of Old Capital Securities tendered by book-entry
transfer, such Old Capital Securities will be credited to an account maintained
at DTC), without expense to the tendering holder, promptly following the
expiration or termination of the Exchange Offer.
The undersigned understands that tenders of Old Capital
Securities pursuant to any one of the procedures described in "The Exchange
Offer -- Procedure for Tendering Old Capital Securities" in the Prospectus and
in the instructions attached hereto will, upon the Company's and the Issuer
Trust's acceptance for exchange of such tendered Old Capital Securities,
constitute a binding agreement among the undersigned, the Company and the Issuer
Trust upon the terms and subject to the conditions of the Exchange Offer. The
undersigned recognizes that, under certain circumstances set forth in the
Prospectus, the Company and the Issuer Trust may not be required to accept for
exchange any of the Old Capital Securities tendered hereby.
Unless otherwise indicated herein in the box entitled "Special
Issuance Instructions" below, the undersigned hereby directs that the New
Capital Securities be issued in the name(s) of the undersigned or, in the case
of a book-entry transfer of Old Capital Securities, that such New Capital
Securities be credited to the account indicated above maintained at DTC. If
applicable, substitute Certificates representing Old Capital Securities not
exchanged or not accepted for exchange will be issued to the undersigned or, in
the case of a book-entry transfer of Old Capital Securities, will be credited to
the account indicated above maintained at DTC. Similarly, unless otherwise
indicated under "Special Delivery Instructions," please deliver New Capital
Securities to the undersigned at the address shown below the undersigned's
signature.
BY TENDERING OLD CAPITAL SECURITIES AND EXECUTING THIS LETTER OF TRANSMITTAL,
THE UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (A) THE UNDERSIGNED IS NOT AN
"AFFILIATE" OF THE COMPANY OR THE ISSUER TRUST, (B) ANY NEW CAPITAL SECURITIES
TO BE RECEIVED BY THE UNDERSIGNED ARE BEING ACQUIRED IN THE ORDINARY COURSE OF
ITS BUSINESS, (C) THE UNDERSIGNED HAS NO ARRANGEMENT OR UNDERSTANDING WITH ANY
PERSON TO PARTICIPATE IN A DISTRIBUTION (WITHIN THE MEANING OF THE SECURITIES
ACT) OF NEW CAPITAL SECURITIES TO BE RECEIVED IN THE EXCHANGE OFFER, AND (D) IF
THE UNDERSIGNED IS NOT A BROKER-DEALER, THE UNDERSIGNED IS NOT ENGAGED IN, AND
DOES NOT INTEND TO ENGAGE IN, A DISTRIBUTION (WITHIN THE MEANING OF THE
SECURITIES ACT) OF SUCH NEW CAPITAL SECURITIES. BY TENDERING OLD CAPITAL
SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING THIS LETTER OF
TRANSMITTAL, A HOLDER OF OLD CAPITAL SECURITIES WHICH IS A BROKER-DEALER
REPRESENTS AND AGREES, CONSISTENT WITH CERTAIN INTERPRETIVE LETTERS ISSUED BY
THE STAFF OF THE DIVISION OF CORPORATION FINANCE OF THE SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") TO THIRD PARTIES, THAT (X) SUCH OLD CAPITAL
SECURITIES HELD BY THE BROKER-DEALER ARE HELD ONLY AS A NOMINEE, OR (Y) SUCH OLD
CAPITAL SECURITIES WERE ACQUIRED BY SUCH BROKER-DEALER FOR ITS OWN ACCOUNT AS A
RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES AND IT WILL
DELIVER THE PROSPECTUS (AS AMENDED OR SUPPLEMENTED FROM TIME TO TIME) IN
CONNECTION WITH ANY RESALE OF SUCH NEW CAPITAL SECURITIES (PROVIDED THAT, BY SO
ACKNOWLEDGING AND BY DELIVERING A PROSPECTUS, SUCH BROKER-DEALER WILL NOT BE
DEEMED TO ADMIT THAT IT IS AN "UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES
ACT).
THE UNDERSIGNED ACKNOWLEDGES THAT THIS EXCHANGE OFFER IS BEING
MADE BY THE COMPANY AND THE ISSUER TRUST BASED UPON THE COMPANY'S AND ISSUER
TRUST'S UNDERSTANDING OF AN INTERPRETATION BY THE STAFF OF THE COMMISSION AS SET
FORTH IN NO-ACTION LETTERS ISSUED TO THIRD PARTIES, THAT THE NEW CAPITAL
SECURITIES ISSUED IN EXCHANGE FOR OLD CAPITAL SECURITIES BY HOLDERS THEREOF
(OTHER THAN TO HOLDERS THAT ARE "AFFILIATES" OF THE COMPANY OR THE ISSUER TRUST
WITHIN THE MEANING OF RULE 405 UNDER THE SECURITIES ACT), MAY BE OFFERED FOR
RESALE, RESOLD OR OTHERWISE TRANSFERRED WITHOUT COMPLIANCE WITH THE REGISTRATION
AND PROSPECTUS DELIVERY PROVISIONS OF THE SECURITIES ACT, PROVIDED THAT: (A)
SUCH HOLDERS ARE NOT AFFILIATES OF THE COMPANY OR THE ISSUER TRUST WITHIN THE
MEANING OF RULE 405 UNDER THE SECURITIES ACT; (B) SUCH NEW CAPITAL SECURITIES
ARE ACQUIRED IN THE ORDINARY COURSE OF SUCH HOLDERS' BUSINESS; AND (C) SUCH
HOLDERS ARE NOT ENGAGED IN, AND DO NOT INTEND TO ENGAGE IN, A DISTRIBUTION OF
SUCH NEW CAPITAL SECURITIES AND HAVE NO ARRANGEMENT OR UNDERSTANDING WITH ANY
PERSON TO PARTICIPATE IN THE DISTRIBUTION OF SUCH NEW CAPITAL SECURITIES.
HOWEVER, THE STAFF OF THE COMMISSION HAS NOT CONSIDERED THE
EXCHANGE OFFER IN THE CONTEXT OF A NO-ACTION LETTER AND THERE CAN BE NO
ASSURANCE THAT THE STAFF OF THE COMMISSION WOULD MAKE A SIMILAR DETERMINATION
WITH RESPECT TO THE EXCHANGE OFFER AS IN OTHER CIRCUMSTANCES. IF A HOLDER OF OLD
CAPITAL SECURITIES IS AN AFFILIATE OF THE COMPANY, OR IS ENGAGED IN OR INTENDS
TO ENGAGE IN A DISTRIBUTION OF THE NEW CAPITAL SECURITIES OR HAS ANY ARRANGEMENT
OR UNDERSTANDING WITH RESPECT TO THE DISTRIBUTION OF THE NEW CAPITAL SECURITIES
TO BE ACQUIRED PURSUANT TO THE EXCHANGE OFFER, SUCH HOLDER COULD NOT RELY ON THE
APPLICABLE INTERPRETATIONS OF THE STAFF OF THE COMMISSION AND MUST COMPLY WITH
THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE SECURITIES ACT IN
CONNECTION WITH ANY SECONDARY RESALE TRANSACTION.
THE COMPANY AND THE ISSUER TRUST HAVE AGREED THAT, SUBJECT TO
THE PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT, THE PROSPECTUS, AS IT MAY
BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME, MAY BE USED BY A PARTICIPATING
BROKER-DEALER (AS DEFINED BELOW) IN CONNECTION WITH RESALES OF NEW CAPITAL
SECURITIES RECEIVED IN EXCHANGE FOR OLD CAPITAL SECURITIES, WHERE SUCH OLD
CAPITAL SECURITIES WERE ACQUIRED BY SUCH PARTICIPATING BROKER-DEALER FOR ITS OWN
ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES, FOR
A PERIOD ENDING NINETY (90) DAYS AFTER THE EXPIRATION DATE (SUBJECT TO EXTENSION
UNDER CERTAIN LIMITED CIRCUMSTANCES DESCRIBED IN THE PROSPECTUS) OR, IF EARLIER,
WHEN ALL SUCH NEW CAPITAL SECURITIES HAVE BEEN DISPOSED OF BY SUCH PARTICIPATING
BROKER-DEALER. IN THAT REGARD, EACH BROKER-DEALER WHO ACQUIRED OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING
ACTIVITIES (A "PARTICIPATING BROKER-DEALER"), BY TENDERING SUCH OLD CAPITAL
SECURITIES AND EXECUTING THIS LETTER OF TRANSMITTAL, AGREES THAT, UPON RECEIPT
OF NOTICE FROM THE COMPANY OR THE ISSUER TRUST OF THE OCCURRENCE OF ANY EVENT OR
THE DISCOVERY OF ANY FACT WHICH MAKES ANY STATEMENT CONTAINED OR INCORPORATED BY
REFERENCE IN THE PROSPECTUS UNTRUE IN ANY MATERIAL RESPECT OR WHICH CAUSES THE
PROSPECTUS TO OMIT TO STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE THE
STATEMENTS CONTAINED OR INCORPORATED BY REFERENCE THEREIN, IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING OR OF THE OCCURRENCE OF
CERTAIN OTHER EVENTS SPECIFIED IN THE REGISTRATION RIGHTS AGREEMENT, SUCH
PARTICIPATING BROKER-DEALER WILL SUSPEND THE SALE OF NEW CAPITAL SECURITIES
PURSUANT TO THE PROSPECTUS UNTIL (A) THE COMPANY AND THE ISSUER TRUST HAVE
AMENDED OR SUPPLEMENTED THE PROSPECTUS TO CORRECT SUCH MISSTATEMENT OR OMISSION
AND HAVE FURNISHED COPIES OF THE AMENDED OR SUPPLEMENTED PROSPECTUS TO THE
PARTICIPATING BROKER-DEALER OR
<PAGE>
(B) THE COMPANY OR THE ISSUER TRUST HAS GIVEN NOTICE THAT THE SALE OF THE NEW
CAPITAL SECURITIES MAY BE RESUMED, AS THE CASE MAY BE. IF THE COMPANY OR THE
ISSUER TRUST GIVES SUCH NOTICE TO SUSPEND THE SALE OF THE NEW CAPITAL
SECURITIES, IT SHALL EXTEND THE NINETY (90) DAY PERIOD REFERRED TO ABOVE DURING
WHICH PARTICIPATING BROKER-DEALERS ARE ENTITLED TO USE THE PROSPECTUS IN
CONNECTION WITH THE RESALE OF NEW CAPITAL SECURITIES BY THE NUMBER OF DAYS
DURING THE PERIOD FROM AND INCLUDING THE DATE OF THE GIVING OF SUCH NOTICE TO
AND INCLUDING THE DATE WHEN PARTICIPATING BROKER-DEALERS SHALL HAVE RECEIVED
COPIES OF THE SUPPLEMENTED OR AMENDED PROSPECTUS NECESSARY TO PERMIT RESALES OF
THE NEW CAPITAL SECURITIES OR TO AND INCLUDING THE DATE ON WHICH THE COMPANY OR
THE ISSUER TRUST HAS GIVEN NOTICE THAT THE SALE OF NEW CAPITAL SECURITIES MAY BE
RESUMED, AS THE CASE MAY BE.
Holders of Old Capital Securities whose Old Capital Securities
are accepted for exchange will not receive accumulated Distributions on such Old
Capital Securities for any period from and after the last Distribution Date to
which Distributions have been paid or duly provided for on such Old Capital
Securities prior to the original issue date of the New Capital Securities or, if
no such Distributions have been paid or duly provided for, will not receive any
accumulated Distributions on such Old Capital Securities, and the undersigned
waives the right to receive any Distributions on such Old Capital Securities
accumulated from and after such Distribution Date or, if no such Distributions
have been paid or duly provided for, from and after March 5, 1998.
All authority herein conferred or agreed to be conferred in
this Letter of Transmittal shall survive the death, bankruptcy, dissolution,
termination or incapacity of the undersigned and any obligation of the
undersigned hereunder shall be binding upon the heirs, executors,
administrators, personal representatives, trustees in bankruptcy, legal
representatives, successors and assigns of the undersigned. Except as stated in
the Prospectus, this tender is irrevocable.
THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION
OF OLD CAPITAL SECURITIES TENDERED" ABOVE AND BY SIGNING THIS LETTER, WILL BE
DEEMED TO HAVE TENDERED THE OLD CAPITAL SECURITIES AS SET FORTH IN SUCH BOX.
HOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 2, 5 AND 6)
(PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE 13)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY INSTRUCTION 2):
<PAGE>
Must be signed by registered holder(s) exactly as name(s)
appear(s) on Certificate(s) for the Old Capital Securities hereby tendered or
on a security position listing, or by any person(s) authorized to become the
registered holder(s) by endorsements and documents transmitted herewith
(including such opinions of counsel, certifications and other information as
may be required by the Issuer Trust or the Exchange Agent for the Old Capital
Securities to comply with the restrictions on transfer applicable to the Old
Capital Securities). If signature is by an attorney-in-fact, executor,
administrator, trustee, guardian, officer of a corporation or another acting
in a fiduciary capacity or representative capacity, please set forth the
signer's full title. See Instruction 5.
- --------------------------------------------------------------------------------
(SIGNATURE(S) OF HOLDER(S))
Date:---------------------------------------------------------------------------
Name(s):------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):----------------------------------------------------------
Address:------------------------------------------------------------------------
Tax Identification or Social Security Number(s):--------------------------------
GUARANTEE OF SIGNATURE(S)(SEE INSTRUCTIONS 2 AND 5):
- --------------------------------------------------------------------------------
(AUTHORIZED SIGNATURE)
Date:---------------------------------------------------------------------------
Name of Firm:-------------------------------------------------------------------
Capacity (full title):----------------------------------------------------------
(PLEASE PRINT)
Address:------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:-------------------------------------------------
SPECIAL ISSUANCE INSTRUCTIONS: (SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities or Old Capital
Securities that are not tendered are to be issued in the name of someone other
than the registered holder(s) of the Old Capital Securities whose name(s)
appear(s) above.
Issue
[ ] Old Capital Securities not tendered to:
[ ] New Capital Securities, to:
Address:------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:-------------------------------------------------
Tax Identification or Social Security Number(s):--------------------------------
SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5 AND 6):
To be completed ONLY if New Capital Securities or Old Capital
Securities that are not tendered are to be sent to someone other than the
registered holder(s) of the Old Capital Securities whose name(s) appear(s)
above, or such registered holder(s) at an address other than that shown above.
Mail
[ ] Old Capital Securities not tendered to:-------------------------------------
[ ] New Capital Securities, to:-------------------------------------------------
Address:------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:-------------------------------------------------
Tax Identification or Social Security Number(s):--------------------------------
INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED DELIVERY
PROCEDURES. This Letter of Transmittal is to be completed either if (a)
Certificates are to be forwarded herewith or (b) tenders are to be made pursuant
to the procedures for tender by book-entry transfer set forth in "The Exchange
Offer -- Procedure for Tendering Old Capital Securities" in the Prospectus.
Certificates, or timely book-entry confirmation of a book-entry transfer of such
Old Capital Securities into the Exchange Agent's account at DTC, as well as
this Letter of Transmittal (or facsimile thereof) or an Agent's Message,
properly completed and duly executed, with any required signature guarantees,
and any other documents required by this Letter of Transmittal, must be received
by the Exchange Agent at its address set forth herein on or prior to the
Expiration Date. The term "book-entry confirmation" means a timely written
confirmation from DTC of book-entry transfer of Old Capital Securities into the
Exchange Agent's account at DTC. Old Capital Securities may be tendered in whole
or in part in the aggregate liquidation amount of $100,000 (100 Capital
Securities) and integral multiples of $1,000 in excess thereof, provided that,
if any Old Capital Securities are tendered for exchange in part, the untendered
aggregate liquidation amount thereof must be $100,000 (100 Capital Securities)
or any integral multiple of $1,000 in excess thereof.
Holders who wish to tender their Old Capital Securities and (i) whose Old
Capital Securities are not immediately available or (ii) who cannot deliver
their Old Capital Securities, this Letter of Transmittal and all other required
documents to the Exchange Agent on or prior to the Expiration Date or (iii) who
cannot complete the procedures for delivery by book-entry transfer on a timely
basis, may tender their Old Capital Securities by properly completing and duly
executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery
procedures set forth in "The Exchange Offer -- Procedure for Tendering Old
Capital Securities" in the Prospectus. Pursuant to such procedures: (a) such
tender must be made by or through an Eligible Institution (as defined below);
(b) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by the Company, must be received by the
Exchange Agent on or prior to the Expiration Date; and (c) the Certificates (or
a book-entry confirmation (as defined in the Prospectus)) representing all
tendered Old Capital Securities, in proper form for transfer, together with a
Letter of Transmittal (or facsimile thereof) or an Agent's Message, properly
completed and duly executed, with any required signature guarantees and any
other documents required by this Letter of Transmittal, must be received by the
Exchange Agent within five (5) New York Stock Exchange, Inc. trading days after
the date of execution of such Notice of Guaranteed Delivery, all as provided in
"The Exchange Offer -- Procedure for Tendering Old Capital Securities" in the
Prospectus.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile or mail to the Exchange Agent, and must include a guarantee by an
Eligible Institution in the form set forth in such Notice. For Old Capital
Securities to be properly tendered pursuant to the guaranteed delivery
procedure, the Exchange Agent must receive a Notice of Guaranteed Delivery on or
prior to the Expiration Date. As used herein and in the Prospectus, "Eligible
Institution" means a firm or other entity identified in Rule 17Ad-15 under the
Exchange Act as "an eligible guarantor institution," including (as such terms
are defined therein) (i) a bank; (ii) a broker, dealer, municipal securities
broker or dealer or government securities broker or dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association or
clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association. THE METHOD OF DELIVERY OF CERTIFICATES, THIS
LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE
RISK OF THE TENDERING HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN
ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL
WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE
IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY ON OR PRIOR TO THE EXPIRATION DATE.
Neither the Company nor the Issuer Trust will accept any alternative,
conditional or contingent tenders. Each tendering holder, by execution of a
Letter of Transmittal (or facsimile thereof), waives any right to receive any
notice of the acceptance of such tender.
2. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of
Transmittal is required if: (i) this Letter of Transmittal is signed by the
registered holder (which term, for purposes of this document, shall include any
participant in DTC whose name appears on a security position listing as the
owner of the Old Capital Securities) of Old Capital Securities tendered
herewith, unless such holder(s) has completed either the box entitled "Special
Issuance Instructions" or the box entitled "Special Delivery Instructions"
above; or (ii) such Old Capital Securities are tendered for the account of a
firm that is an Eligible Institution.
In all other cases, an Eligible Institution must guarantee the signature(s) on
this Letter of Transmittal. See Instruction 5.
3. INADEQUATE SPACE. If the space provided in the box captioned
"Description of Old Capital Securities" is inadequate, the Certificate number(s)
and/or the Liquidation Amount of Old Capital Securities and any other required
information should be listed on a separate signed schedule which is attached to
this Letter of Transmittal.
4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS. Tenders of Old Capital
Securities will be accepted only in the Liquidation Amount of $100,000 (100
Capital Securities) and integral multiples of $1,000 in excess thereof, provided
that if any Old Capital Securities are tendered for exchange in part, the
untendered Liquidation Amount thereof must be $100,000 (100 Capital Securities)
or any integral multiple of $1,000 in excess thereof. If less than all the Old
Capital Securities evidenced by any Certificate submitted are to be tendered,
fill in the Liquidation Amount of Old Capital Securities which are to be
tendered in the box entitled "Liquidation Amount of Old Capital Securities
Tendered (if less than all)." In such case, new Certificate(s) for the remainder
of the Old Capital Securities that were evidenced by your old Certificate(s)
will only be sent to the holder of the Old Capital Securities, promptly after
the Expiration Date unless the appropriate boxes on this Letter of Transmittal
are completed. All Old Capital Securities represented by Certificates delivered
to the Exchange Agent will be deemed to have been tendered unless otherwise
indicated.
Except as otherwise provided herein, tenders of Old Capital Securities may be
withdrawn at any time on or prior to the Expiration Date. In order for a
withdrawal to be effective on or prior to that time, a written, telegraphic,
telex or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at one of its addresses set forth above or in the
Prospectus on or prior to the Expiration Date. Any such notice of withdrawal
must specify the name of the person who tendered the Old Capital Securities to
be withdrawn, the aggregate Liquidation Amount of Old Capital Securities to be
withdrawn, and (if Certificates for Old Capital Securities have been tendered)
the name of the registered holder of the Old Capital Securities as set forth on
the Certificate for the Old Capital Securities, if different from that of the
person who tendered such Old Capital Securities. If Certificates for the Old
Capital Securities have been delivered or otherwise identified to the Exchange
Agent, then prior to the physical release of such Certificates for the Old
Capital Securities, the tendering holder must submit the serial numbers shown on
the particular Certificates for the Old Capital Securities to be withdrawn and
the signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Old Capital Securities tendered for the
account of an Eligible Institution. If Old Capital Securities have been
tendered pursuant to the procedures for book-entry transfer set forth in "The
Exchange Offer -- Procedure for Tendering Old Capital Securities," the notice of
withdrawal must specify the name and number of the account at DTC to be
credited with the withdrawal of Old Capital Securities, in which case a notice
of withdrawal will be effective if delivered to the Exchange Agent by written or
facsimile transmission. Withdrawals of tenders of Old Capital Securities may not
be rescinded. Old Capital Securities properly withdrawn will not be deemed
validly tendered for purposes of the Exchange Offer, but may be retendered at
any subsequent time on or prior to the Expiration Date by following any of the
procedures described in the Prospectus under "The Exchange Offer -- Procedure
for Tendering Old Capital Securities."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Company and the
Issuer Trust, in their sole discretion, whose determination shall be final and
binding on all parties. Neither the Company, the Issuer Trust, any affiliates
or assigns of the Company and the Issuer Trust, the Exchange Agent, nor any
other person, shall be under any duty to give any notification of any
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification. Any Old Capital Securities which have been tendered
but which are withdrawn on or prior to the Expiration Date will be returned to
the holder thereof without cost to such holder promptly after withdrawal.
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Old
Capital Securities tendered hereby, the signature(s) must correspond exactly
with the name(s) as written on the face of the Certificate(s) without
alteration, enlargement or any change whatsoever.
If any of the Old Capital Securities tendered hereby are owned of record by two
or more joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Old Capital Securities are registered in different name(s) on
several Certificates, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal (or facsimiles thereof) as there are different
registrations of Certificates.
If this Letter of Transmittal or any Certificates or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing and must submit proper evidence
satisfactory to the Company and the Issuer Trust, in their sole discretion, of
each such person's authority to so act.
When this Letter of Transmittal is signed by the registered owner(s) of the Old
Capital Securities listed and transmitted hereby, no endorsement(s) of
Certificate(s) or separate bond power(s) are required unless New Capital
Securities are to be issued in the name of a person other than the registered
holder(s). Signature(s) on such Certificate(s) or bond power(s) must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the registered
owner(s) of the Old Capital Securities listed, the Certificates must be endorsed
or accompanied by appropriate bond powers, signed exactly as the name or names
of the registered owner(s) appear(s) on the Certificates, and also must be
accompanied by such opinions of counsel, certifications and other information as
the Company, the Issuer Trust or the Exchange Agent may require in accordance
with the restrictions on transfer applicable to the Old Capital Securities.
Signatures on such Certificates or bond powers must be guaranteed by an Eligible
Institution.
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Capital Securities
are to be issued in the name of a person other than the signer of this Letter of
Transmittal, or if New Capital Securities are to be sent to someone other than
the signer of this Letter of Transmittal or to an address other than that shown
above, the appropriate boxes on this Letter of Transmittal should be completed.
Certificates for Old Capital Securities not exchanged will be returned by mail
or, if tendered by book-entry transfer, by crediting the account indicated above
maintained at DTC unless the appropriate boxes on this Letter of Transmittal
are completed. See Instruction 4.
7. IRREGULARITIES. The Company and the Issuer Trust will determine, in
their sole discretion, all questions as to the form of documents, validity,
eligibility (including time of receipt) and acceptance for exchange of any
tender of Old Capital Securities, which determination shall be final and binding
on all parties. The Company and the Issuer Trust reserve the absolute right to
reject any and all tenders determined by either of them not to be in proper form
or the acceptance of which, or exchange for, may, in the view of counsel to the
Company and the Issuer Trust, be unlawful. The Company and the Issuer Trust also
reserve the absolute right, subject to applicable law, to waive any of the
conditions of the Exchange Offer set forth in the Prospectus under "The Exchange
Offer -- Conditions to the Exchange Offer" or any conditions or irregularity in
any tender of Old Capital Securities of any particular holder whether or not
similar conditions or irregularities are waived in the case of other holders.
The Company's and the Issuer Trust's interpretation of the terms and conditions
of the Exchange Offer (including this Letter of Transmittal and the instructions
hereto) will be final and binding. No tender of Old Capital Securities will be
deemed to have been validly made until all irregularities with respect to such
tender have been cured or waived. Neither the Company, the Issuer Trust, any
affiliates or assigns of the Company, the Issuer Trust, the Exchange Agent, nor
any other person, shall be under any duty to give notification of any
irregularities in tenders or incur any liability for failure to give such
notification.
8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions
and requests for assistance may be directed to the Exchange Agent at its address
and telephone number set forth on the front of this Letter of
Transmittal. Additional copies of the Prospectus, the Notice of Guaranteed
Delivery and the Letter of Transmittal may be obtained from the Exchange
Agent or from your broker, dealer, commercial bank, trust company or other
nominee.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income
tax law, a holder whose tendered Old Capital Securities are accepted for
exchange is required to provide the Exchange Agent with such holder's correct
taxpayer identification number ("TIN") on the Substitute Form W-9 below. If the
Exchange Agent is not provided with the correct TIN, the Internal Revenue
Service (the "IRS") may subject the holder or other payee to a $50 penalty. In
addition, payments to such holders or other payees with respect to Old Capital
Securities exchanged pursuant to the Exchange Offer may be subject to 31% backup
withholding.
The box in Part 2 of the Substitute Form W-9 may be checked if the tendering
holder has not been issued a TIN and has applied for a TIN or intends to apply
for a TIN in the near future. If the box in Part 2 is checked, the holder or
other payee must also complete the Certificate of Awaiting Taxpayer
Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 2 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Exchange Agent will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Exchange Agent. The Exchange Agent will retain such amounts
withheld during the 60-day period following the date of the Substitute Form W-9.
If the holder furnishes the Exchange Agent with its TIN within 60 days after the
date of the Substitute Form W-9, the amounts retained during the 60 day period
will be remitted to the holder and no further amounts shall be retained or
withheld from payments made to the holder thereafter. If, however, the holder
has not provided the Exchange Agent with its TIN within such 60 day period,
amounts withheld will be remitted to the IRS as backup withholding. In addition,
31% of all payments made thereafter will be withheld and remitted to the IRS
until a correct TIN is provided.
The holder is required to give the Exchange Agent the TIN (e.g., social security
number or employer identification number) of the registered owner of the Old
Capital Securities or of the last transferee appearing on the transfers attached
to, or endorsed on, the Old Capital Securities. If the Old Capital Securities
are registered in more than one name or are not in the name of the actual owner,
consult the enclosed "Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9" for additional guidance on which number to
report.
Certain holders (including, among others, corporations, financial institutions
and certain foreign persons) may not be subject to these backup withholding and
reporting requirements. Such holders should nevertheless complete the attached
Substitute Form W-9 below, and write "exempt" on the face thereof, to avoid
possible erroneous backup withholding. A foreign person may qualify as an exempt
recipient by submitting a properly completed IRS Form W-8, signed under
penalties of perjury, attesting to that holder's exempt status. Please consult
the enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for additional guidance on which holders are exempt from
backup withholding.
Backup withholding is not an additional U.S. Federal income tax. Rather, the
U.S. Federal income tax liability of a person subject to backup withholding will
be reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained.
10. WAIVER OF CONDITIONS. The Company and the Issuer Trust reserve the
absolute right to waive satisfaction of any or all conditions enumerated in the
Prospectus.
11. NO CONDITIONAL TENDERS. No alternative, conditional, irregular or
contingent tenders will be accepted. All tendering holders of Old Capital
Securities, by execution and delivery of this Letter of Transmittal, shall waive
any right to receive notice of the acceptance of their Old Capital Securities
for exchange.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any Certificate(s)
representing Old Capital Securities have been lost, destroyed or stolen, the
holder should promptly notify the Exchange Agent. The holder will then be
instructed as to the steps that must be taken in order to replace the
Certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost, destroyed or stolen
Certificate(s) have been followed.
13. SECURITY TRANSFER TAXES. Holders who tender their Old Capital
Securities for exchange will not be obligated to pay any transfer taxes in
connection therewith. If, however, New Capital Securities are to be delivered
to, or are to be issued in the name of, any person other than the registered
holder of the Old Capital Securities tendered, or if a transfer tax is imposed
for any reason other than the exchange of Old Capital Securities in connection
with the Exchange Offer, then the amount of any such transfer tax (whether
imposed on the registered holder or any other persons) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO 5:00
P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
TO BE COMPLETED BY ALL TENDERING SECURITY HOLDERS (SEE INSTRUCTION 9)
<TABLE>
<S> <C>
PAYER'S NAME: BANKERS TRUST COMPANY
SUBSTITUTE PART 1 -- PLEASE PROVIDE YOUR TIN ON THE LINE Social Security Number
AT RIGHT AND CERTIFY BY SIGNING AND DATING BELOW Employer
FORM W-9 Identification Number
-------------------
Department of the Treasury
Internal Revenue Service
PAYER'S REQUEST FOR TAXPAYER
IDENTIFICATION NUMBER (TIN) AND
CERTIFICATION
---------------------------------------------------------------------------
PART 2 -- CERTIFICATION -- Under penalties of perjury, I certify that:
(1) the number shown on this form is my correct taxpayer
identification number (or I am waiting for a number to be issued to me);
(2) I am not subject to backup withholding either because
(i) I am exempt from backup withholding, (ii) I have not been notified
by the Internal Revenue Service ("IRS") that I am subject to backup
withholding as a result of a failure to report all interest or
dividends, or (iii) the IRS has notified me that I
am no longer subject to backup withholding, and
(3) any other information provided on this form is true and
correct.
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) in Part 2 above
if you have been notified by the IRS that you are subject to backup
withholding because of under reporting interest or dividends on your tax
return and you have not been notified by the IRS that you are no longer
subject to backup withholding.
-------------------------------------------------- ------------------------
Signature------------------------------------- Part 3
Name (Please Print)--------------------------- Awaiting TIN [ ]
Address (Please Print)_________________________
</TABLE>
<PAGE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU PURSUANT TO THE
EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (i) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (ii) I intend to
mail or deliver an application in the near future. I understand that if I do
not provide a taxpayer identification number by the time of payment, 31% of all
payments made to me on account of the New Capital Securities shall be retained
until I provide a taxpayer identification number to the Exchange Agent and
that, if I do not provide my taxpayer identification number within 60 days,
such retained amounts shall be remitted to the Internal Revenue Service as
backup withholding and 31% of all reportable payments made to me thereafter
will be withheld and remitted to the Internal Revenue Service until I provide a
taxpayer identification number.
Signature:-------------------------------- Date:-------------------------------
Name (Please Print):-----------------------------------------------------------
Address (Please Print):--------------------------------------------------------
NOTICE OF GUARANTEED DELIVERY FOR TENDER OF ANY AND ALL
OF THE OUTSTANDING 8.05% CAPITAL SECURITIES (LIQUIDATION AMOUNT $1,000 PER
CAPITAL SECURITY) OF FCB/NC CAPITAL TRUST I FULLY AND UNCONDITIONALLY
GUARANTEED BY FIRST CITIZENS BANCSHARES, INC.
This Notice of Guaranteed Delivery, or one substantially
equivalent to this form, must be used to accept the Exchange Offer (as defined
below) if (i) certificates for the Issuer Trust's (as defined below) 8.05%
Capital Securities issued on March 5, 1998 (the "Old Capital Securities")
are not immediately available, (ii) Old Capital Securities, the Letter of
Transmittal and all other required documents cannot be delivered to Bankers
Trust Company (the "Exchange Agent") on or prior to 5:00 p.m., New York City
time, on the Expiration Date (as defined in the Prospectus referred to below)
or (iii) the procedures for delivery by book-entry transfer cannot be
completed on a timely basis. This Notice of Guaranteed Delivery may be
delivered by hand, overnight courier or mail, or transmitted by facsimile
transmission, to the Exchange Agent on or prior to the Expiration Date. See
"The Exchange Offer -- Procedure for Tendering Old Capital Securities"
in the Prospectus. In addition, in order to utilize the guaranteed delivery
procedure to tender Old Capital Securities pursuant to the Exchange Offer, a
completed, signed and dated Letter of Transmittal relating to the Old Capital
Securities (or facsimile thereof) must also be received by the Exchange Agent
prior to 5:00 p.m., New York City time, on the Expiration Date.
Capitalized terms used but not defined herein have the
meanings given them in the Prospectus.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
BANKERS TRUST COMPANY
<TABLE>
<CAPTION>
<S> <C>
By Mail: By Hand: By Overnight Mail:
BT Services Tennessee, Inc. Bankers Trust Company BT Services Tennessee, Inc
Corporate Trust and Agency Group Corporate Trust and Agency Group Corporate Trust and Agency Group
Reorganization Unit Receipt and Delivery Window Reorganization Unit
P.O. Box 292737 123 Washington Street, 1st Floor 648 Grassmere Park Road
Nashville, TN 37229-2737 New York, NY 10006 Nashville, TN 37211
</TABLE>
For Information Call:
(800) 735-7777
Confirm: (615) 835-3572
Facsimile: (615) 835-3701
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN
ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF
GUARANTEED DELIVERY VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE
WILL NOT CONSTITUTE A VALID DELIVERY.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO
GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED
TO BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS
THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED
IN THE SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
<PAGE>
LADIES AND GENTLEMEN:
The undersigned hereby tenders to FCB/NC Capital Trust
I, a Delaware business trust (the "Issuer Trust"), upon the terms and
subject to the conditions set forth in the Prospectus dated
___________________, 1998 (as the same may be amended or supplemented from
time to time, the "Prospectus"), and the related Letter of Transmittal (which
together constitute the "Exchange Offer"), receipt of which is hereby
acknowledged, the aggregate Liquidation Amount of Old Capital Securities
set forth below pursuant to the guaranteed delivery procedures set forth
in the Prospectus under the caption "The Exchange Offer -- Procedure for
Tendering Old Capital Securities."
All authority herein conferred or agreed to be conferred in
this Notice of Guaranteed Delivery shall survive the death, incapacity or
dissolution of the undersigned and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators,
personal representatives, trustees in bankruptcy, legal representatives,
successors and assigns of the undersigned.
Liquidation Amount Tendered: $_________________________
Name(s) of Registered Holder(s):
Certificate No(s)(if available):
Total Liquidation Amount represented by
Old Capital Securities Certificate(s):
$_____________________________________________________
PLEASE SIGN HERE:
(Signature(s) of Owner(s) or Authorized Signatory)
Date:
, 1998
Area code and telephone number:
<PAGE>
If Old Capital Securities will be tendered by book-entry
transfer, provide the following information:
DTC Account Number:
Transaction Number:
Must be signed by the holder(s) of the Old Capital
Securities exactly as their name(s) appear(s) on certificate(s) for the
Old Capital Securities or on a security position listing, or by person(s)
authorized to become registered holder(s) by endorsements and documents
transmitted with this Notice of Guaranteed Delivery. If signature is by an
attorney-in-fact, executor, administrator, trustee, guardian, officer of a
corporation or other person acting in a fiduciary or representative capacity,
please set forth the signer's full title. Please print name(s) and address(es)
Names:_____________________________
_____________________________
_____________________________
Capacity:__________________________
Address: __________________________
__________________________
__________________________
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED.
<PAGE>
GUARANTEE OF DELIVERY
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended, as an
"eligible guarantor institution," including (as such terms are defined
therein): (i) a bank; (ii) a broker, dealer, municipal securities broker,
municipal securities dealer, government securities broker or government
securities dealer; (iii) a credit union; (iv) a national securities
exchange, registered securities association or clearing agency; or (v) a
savings association that is a participant in a Securities Transfer
Association recognized program (each of the foregoing being referred to as
an "Eligible Institution"), hereby guarantees to deliver to the Exchange
Agent, at one of its addresses set forth above, either the Old Capital
Securities tendered hereby in proper form for transfer, or confirmation of the
book-entry transfer of such Old Capital Securities to the Exchange Agent's
account at The Depository Trust Company ("DTC") pursuant to the procedures for
book-entry transfer set forth in the Prospectus, in either case together with
one or more properly completed and duly executed Letter(s) of Transmittal
(or facsimile thereof) and any other required documents within five (5) New
York Stock Exchange trading days after the date of execution of this Notice of
Guaranteed Delivery.
The undersigned acknowledges that it must deliver the
Letter(s) of Transmittal (or facsimile thereof) and the Old Capital Securities
tendered hereby to the Exchange Agent within the time period set forth above
and that failure to do so could result in a financial loss to the undersigned.
Name of Firm
Authorized Signature
Name:
Address:
(Please Type or Print)
Title:
<PAGE>
Date:
Area code and telephone number
NOTE: DO NOT SEND CERTIFICATES FOR OLD CAPITAL SECURITIES
WITH THIS NOTICE OF GUARANTEED DELIVERY. ACTUAL SURRENDER OF OLD CAPITAL
SECURITIES MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY COMPLETED
AND DULY EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS.
BANKERS TRUST COMPANY
EXCHANGE AGENT AGREEMENT
Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street, 4th Floor
New York, NY 10006
Attention: Corporate Market Services
Ladies and Gentlemen:
FCB/NC Capital Trust I (the "Issuer Trust"), a statutory business trust
created under the laws of the State of Delaware, together with First Citizens
BancShares, Inc., a Delaware corporation (the "Company"), is offering to
exchange (the "Exchange Offer") up to $150,000,000 aggregate liquidation
amount of its 8.05% Capital Securities (the "New Capital Securities") for an
equal principal amount of its outstanding 8.05% Capital Securities (the "Old
Capital Securities"), of which $150,000,000 aggregate liquidation amount is
outstanding (the "New Capital Securities" and the "Old Capital Securities" are
collectively referred to herein as the "Capital Securities"), pursuant to a
prospectus (the "Prospectus") included in the Company's Registration
Statement on Form S-4 (File No._____________________________) as amended (the
"Registration Statement"), filed with the Securities and Exchange
Commission (the "SEC"). The Term "Expiration Date" shall mean 5:00 p.m.,
New York City time, on ______________________, 1998, unless the Exchange
Offer is extended as provided in the Prospectus, in which case the term
"Expiration Date" shall mean the latest date and time to which the Exchange
Offer is extended. Upon execution of this Agreement, Bankers Trust Company
will act as the Exchange Agent for the Exchange Offer (the "Exchange Agent").
Capitalized terms used and not otherwise defined herein shall have the
respective meanings ascribed thereto in the Prospectus.
A copy of each of the form of letter of transmittal (the "Letter of
Transmittal"), the form of the notice of guaranteed delivery (the "Notice of
Guaranteed Delivery"), the form of letter to brokers and the form of letter of
clients (collectively, the "Tender Documents") to be used by Holders of Old
Capital Securities in order to receive New Capital Securities pursuant to the
Exchange Offer are attached hereto as Exhibit A.
The Company hereby appoints you to act as Exchange Agent in connection with
the Exchange Offer. In carrying out your duties as Exchange Agent, you are to
act in accordance with the following provisions of this Agreement:
1. You are to mail the Prospectus and the Tender Documents to
all of the Holders and participants on the day that you are notified by the
Company that the Registration Statement has become effective under the
Securities Act of 1933, as amended, or as soon as practicable thereafter, and
to make mailings subsequent to the date thereof and to any persons who become
Holders prior to the Expiration Date and to any persons as may from time to
time be requested by the Company. All mailings pursuant to this Section 1
shall be by first class mail, postage prepaid, unless otherwise specified by
the Company. You shall also accept and comply with telephone requests for
information relating to the Exchange Offer provided that such information
shall relate only to the procedures for tendering Old Capital Securities in (or
withdrawing tenders of Old Capital Securities from) the Exchange Offer. All
other requests for information relating to the Exchange Offer shall be
directed to the Company, Attention: Kenneth A. Black
2. You are to examine Letters of Transmittal and the Old
Capital Securities and other documents delivered or mailed to you, by or for
the Holders, prior to the Expiration Date, to ascertain whether (i) the
Letters of Transmittal are properly executed and completed in accordance with
the instructions set forth therein, (ii) the Old Capital Securities are in
proper form for transfer and (iii) all other documents submitted to you are
in proper form. In each case where a Letter of Transmittal or other document
has been improperly executed or completed or, for any other reason, is not in
proper form, or some other irregularity exists, you are authorized to
endeavor to take such action as you consider appropriate to notify the
tendering Holder of such irregularity and as to the appropriate means of
resolving the same. Determination of questions as to the proper completion or
execution of the Letters of Transmittal, as to the proper form for transfer of
the Old Capital Securities, or as to any other irregularity in connection
with the submission of Letters of Transmittal and/or Old Capital
Securities and other documents in connection with the Exchange Offer,
shall be made by the officers of, or counsel for, the Company and the Issuer
Trust at their written instructions or oral direction confirmed by
facsimile. Any determination made by the Company and the Issuer Trust on
such questions shall be final and binding.
3. At the written request of the Company or its counsel, Ward
and Smith, P.A. , you shall notify tendering Holders of Old Capital Securities
of the termination of the Exchange Offer. In the event of any such
termination, you will return all tendered Old Capital Securities to the
persons entitled thereto, at the request and expense of the Company.
4. Tender of the Old Capital Securities may be made only
as set forth in the Letter of Transmittal. Notwithstanding the foregoing,
tenders which the Company shall approve in writing as having been properly
delivered shall be considered to be properly tendered. Letters of Transmittal
and Notices of Guaranteed Delivery shall be recorded by you as to the date and
time of receipt and shall be preserved and retained by you at the Company's
expense for six years. New Capital Securities are to be issued in exchange
for Old Capital Securities pursuant to the Exchange Offer only (i) against
deposit with you on or prior to the Expiration Date or, in the case of a
tender in accordance with the guaranteed delivery procedures outlined in
Instruction 1 of the Letter of Transmittal, within five (5) New York Stock
Exchange trading days after the date of execution of the Notice of Guaranteed
Delivery, together with executed Letters of Transmittal and other documents
required by the Exchange Offer or (ii) in the event that the Holder is a
participant in the Depositary Trust Company ("DTC" system), by the
utilization of DTC's Automated Tender Offer Program ("ATOP") and any
evidence required by the Exchange Offer.
You are hereby directed to establish an account with respect
to the Capital Securities at The Depositary Trust Company (the "Book Entry
Transfer Facility") within two days after the date hereof in accordance with
SEC Regulation 240.17 Ad. Any financial institution that is a participant
in the Book Entry Transfer Facility system may, until the Expiration Date,
make book-entry delivery of the Old Capital Securities by causing the Book
Entry Facility to transfer such Old Capital Securities into your account in
accordance with the procedure for such transfer established by the Book
Entry Transfer Facility. In every case, however, a Letter of Transmittal
(or a manually executed facsimile thereof), or an Agent's Message,
properly completed and duly executed, with any required signature guarantees
and any other required documents, must be transmitted to and received by you
on or prior to the Expiration Date or the guaranteed delivery procedures
described in the Tender Documents must be complied with.
5. Upon oral or written request of the Company (with
written confirmation of any such oral request thereafter), you will transmit
by telephone, and promptly thereafter confirm in writing to Kenneth A. Black
or such other persons as the Company may reasonably request, the aggregate
number and principal amount of Old Capital Securities tendered to you and the
number and principal amount of Old Capital Securities property tendered that
day. In addition, you will also inform the aforementioned persons, upon
oral request made from time to time (with written confirmation of such
request thereafter) prior to the Expiration Date, of such information as
they or any of them may reasonable request.
6. Upon the terms and subject to the conditions of the
Exchange Offer, delivery of New Capital Securities will be made by you
promptly after acceptance of the tendered Old Capital Securities. You will
hold all items which are deposited for tender with you after 5:00 p.m. New
York City time, on the Expiration Date pending further instructions from an
officer of the Company.
7. If any Holder shall report to you that his or her failure to
surrender Old Capital Securities registered in his or her name is due to the
loss or destruction of a certificate or certificates, you shall request
such Holder (i) to furnish to you an affidavit of loss and, if required
by the Company, a bond of indemnity in an amount and evidenced by such
certificate or certificates of a surety, as may be satisfactory to you and
the Company, and (ii) to execute and deliver an agreement to indemnify the
Company and you in such form as is acceptable to you and the Company. The
obligees to be named in each such indemnity bond shall include the Company and
you. You shall report to the Company the names of all Holders who claim
that their Old Capital Securities have been lost or destroyed and the
Liquidation Amount of such Old Capital Securities.
8. As soon as practicable after the Expiration Date, you shall
mail or deliver via the Book Entry Transfer Facility's applicable procedures
to a Holder the New Capital Securities that such Holder may be entitled to
receive and you shall arrange for cancellation of the Old Capital Securities
submitted to you or returned by DTC in connection with ATOP. Such Old Capital
Securities shall be forwarded to ____________ for cancellation and retirement
as you are instructed by the Company (or a representative designated by the
Company) in writing.
9. For your services as the Exchange Agent hereunder, the
Company shall pay you in accordance with the schedule of fees attached hereto
as Exhibit B. The Company also will reimburse you for your reasonable
out-of-pocket expenses (including, but not limited to, reasonable attorneys'
fees not previously paid to you as set forth in Exhibit B) in connection with
your services promptly after submission to the Company of itemized
statements.
10. You are not authorized to pay any concessions, commissions
or solicitation fees to any broker, dealer, bank or other person or to engage
or utilize any person to solicit tenders.
11. As the Exchange Agent hereunder you:
a. shall have no duties or obligations other than
those specifically set forth herein or in the
Exhibits attached hereto or as may be subsequently
requested in writing of you by the Company and agreed
to by you in writing with respect to the Exchange
Offer;
b. will be regarded as making no representations and
having no responsibilities as to the validity,
accuracy, sufficiency, value or genuineness of
any Old Capital Securities deposited with you
hereunder, any New Capital Securities, or any
Tender Documents or other documents prepared by the
Company in connection with the Exchange Offer;
c. shall not be obligated to take any legal
action hereunder which might in your judgment
involve any expense or liability unless you shall
have been furnished with an indemnity reasonably
satisfactory to you;
d. may rely on, and shall be fully protected and
indemnified as provided in Section 12 hereof in
acting upon, the written or oral instructions
with respect to any matter relating to your acting
as Exchange Agent specifically covered by this
Agreement or supplementing or qualifying any such
action of any officer or agent, or such other
person or persons as may be designated or whom
you reasonably believe have been designated by,
the Company;
e. may consult with counsel satisfactory to you,
including counsel for the Company, and the advice of
such counsel shall be full and complete
authorization and protection in respect of any
action taken, suffered or omitted by you in good
faith and in accordance with such advice of such
counsel;
f. shall not at any time advise any person as to
the wisdom of the Exchange Offer or as to the
market value or decline or appreciation in market
value of any Old Capital Securities or New Capital
Securities; and
g. shall not be liable for any action which you
may do or refrain from doing in connection with
this Agreement except for your gross negligence,
willful misconduct or bad faith.
12. The Company covenants and agrees to indemnify and hold
harmless Bankers Trust Company and its officers, directors, employees, agents
and affiliates (collectively, the "Indemnified Parties" and each an
"Indemnified Party") against any loss, liability or reasonable expense of
any nature (including reasonable attorneys' and other fees and expenses)
incurred in connection with the administration of the duties of the
Indemnified Parties hereunder in accordance with this Agreement except when
caused by an Indemnified Party's gross negligence, willful misconduct or bad
faith; provided, however, such Indemnified Party shall use its best effort to
notify the Company by letter, or by cable, telex or telecopier confirmed
by letter, of the written assertion of a claim against such Indemnified Party,
or of any action commenced against such Indemnified Party, promptly after but
in any event within 10 days of the date such Indemnified Party shall have
received any such written assertion of a claim or shall have been served with a
summons, or other legal process, giving information as to the nature and
basis of the claim; provided, however, that failure to so notify the
Company shall not relieve the Company of any liability which it may otherwise
have hereunder except such liability that is a direct result of such
Indemnified Party's failure to so notify the Company. The Company shall
be entitled to participate at its own expense in the defense of any such
claim or legal action and if the Company so elects, or if the Indemnified
Party in such notice to the Company so directs, the Company shall assume the
defense of any suit brought to enforce any such claim and shall not be liable
for any separate legal fees and expenses of the Indemnified Party after it has
assumed such defense; provided, however, that in the event that there may be a
conflict of interest between the positions of the Indemnified Party and the
Company in conducting the defense of such claim, the Indemnified Party shall be
entitled to separate counsel, the reasonable fees and expenses of which shall be
paid by the Company. You shall not enter into a settlement or other compromise
with respect to any indemnified loss, liability or expense without the prior
written consent of the Company, which shall not be unreasonably withheld or
delayed.
13. This Agreement and your appointment as the Exchange Agent
shall be construed and enforced in accordance with the laws of the State of New
York and shall inure to the benefit of, and the obligations created hereby
shall be binding upon, the successors and assigns of the parties hereto. No
other person shall acquire or have any rights under or by virtue of this
Agreement.
14. The parties hereto hereby irrevocably submit to the venue
and jurisdiction of any New York State or federal court sitting in the
Borough of Manhattan in New York City in any action or proceeding arising out
of or relating to this Agreement, and the parties hereby irrevocably agree
that all claims in respect of such action or proceeding arising out of or
relating to this Agreement shall be heard and determined in such a New York
State or federal court. The parties hereby consent to and grant to any such
court jurisdiction over the persons of such parties and over the subject
matter of any such dispute and agree that delivery or mailing of any process or
other papers in the manner provided herein, or in such other manner as may be
permitted by law, shall be valid and sufficient service thereof.
15. This Agreement may not be modified, amended or
supplemented without an express written agreement executed by the parties
hereto. Any inconsistency between this Agreement and the Tender Documents, as
they may from time to time be supplemented or amended, shall be resolved in
favor of the latter, except with respect to the duties, liabilities and
indemnification of you as Exchange Agent.
16. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
17. In case any provision of this Agreement 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.
18. Unless terminated earlier by the parties hereto, this
Agreement shall terminate 90 days following the Expiration Date.
Notwithstanding the foregoing, Sections 9 and 12 shall survive the termination
of this Agreement. Upon any termination of this Agreement, you shall promptly
deliver to the Property Trustee any certificates for Old Capital Securities or
New Capital Securities, funds or property then held by you as Exchange Agent
under this Agreement.
19. All notices and communications hereunder shall be in
writing and shall be deemed to be duly given if delivered or mailed first class
certified or registered mail, postage prepaid, or telecopied as follows:
If to Company: First Citizens BancShares, Inc.
3128 Smoketree Court
Raleigh, NC 27604
Attn: Kenneth A. Black
Telephone:
Telecopier No:
and a copy to: Ward and Smith, P.A.
1001 College Court
Post Office Box 867
New Bern, North Carolina 28563-0867
Attn: William R. Lathan, Jr.
Telephone: (252) 633-1000
Facsimile: (252) 636-2121
If to you: Bankers Trust Company
Corporate Trust and Agency Group
Four Albany Street - 4th Floor
New York, NY 10006
Attn.:
Telephone: 212-250-
Telecopier: 212-250-6392/6961
or such other address or telecopy number as any of the above may have
furnished to the other parties in writing for such purposes.
20. This Letter Agreement and all of the obligations
hereunder shall be assumed by any and all successors and assigns of the
Company.
If the foregoing is in accordance with your understanding, would you
please indicate your agreement by signing and returning the enclosed copy of
this Agreement to the Company.
Very truly yours,
FIRST CITIZENS BANCSHARES, INC.
By:_________________________
Title:
Agreed to this _____ day of __________, 1998
BANKERS TRUST COMPANY, as Exchange Agent
By: ___________________________________
Title:
<PAGE>
EXHIBIT A
[FORM OF TENDER DOCUMENTS]
<PAGE>
EXHIBIT B
Bankers Trust Company
Corporate Trust and Agency Group
SCHEDULE OF FEES
Exchange Agent $5,000
Covers review of the Exchange Agent Agreement, the Letter of
Transmittal and other related documentation; establishment of accounts and
systems link with depositories; operational and administrative charges and
time spent in connection with the review, receipt and processing of Letters
of Transmittal, and Agent's Messages.
Note: The fees set forth in this schedule are subject to review of
documentation. The fees are also subject to change should circumstances
warrant. Out-of-pocket expenses and disbursements, including counsel
fees, incurred in the performance of our duties will be added to the billed
fees. Fees for any services not covered in this or related schedules will be
based upon our appraisal of the services rendered. We may place orders to
buy/sell financial instruments with outside broker-dealers that we select,
as well as with BT or its affiliates. These transactions (for which
normal and customary spreads or other compensation may be earned by such
broker-dealers, including BT or its affiliates, in addition to the charges
quoted above) will be executed on a riskless principal basis solely for your
account(s) and without recourse to us or our affiliates. If you choose to
invest in any mutual fund, BT and/or our affiliates may earn investment
management fees and other service fees/expenses associated with these
funds as disclosed in the mutual fund prospectus provided to you, in addition
to the charges quoted above. Likewise, BT has entered into agreements with
certain mutual funds or their agents to provide shareholder services to those
funds. For providing these shareholder services, BT is paid a fee by these
mutual funds that calculated on an annual basis does not exceed 25 basis
points of the amount of your investment in these mutual funds. In addition,
if you choose to use other services provided by BT or its affiliates,
Corporate Trust or other BT affiliates may be allocated a portion of the fees
earned. We will provide periodic account statements describing
transactions executed for your account(s). Trade confirms will be available
upon your request at no additional charge. If a transaction should fail to
close for reasons beyond our control, we reserve the right to charge
our acceptance fee plus reimbursement for legal fees incurred.
Shares of mutual funds are not deposits or obligations of, or guaranteed by,
Bankers Trust Company or any of its affiliates and are not insured by the
Federal Deposit Insurance Corporation or any other agency of the U.S.
Government. Investments in the mutual funds involve the possible loss of
principal. Please read the prospectus carefully before investing.
