<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
For Registration of Certain Classes of Securities
Pursuant to Section 12(b) or (g) of the
Securities Exchange Act of 1934
SOVEREIGN BANCORP, INC
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2453088
- ----------------------- ---------------
(State of Incorporation (I.R.S. Employer
or organization) Identification No.)
2000 Market Street
Philadelphia, Pennsylvania 19103
- -------------------------- ----------
(Address of principal (Zip Code)
executive offices)
If this Form relates to the registration of a class of debt securities and is
effective upon filing pursuant to General Instruction A.(c)(1), please check the
following box. [ ]
If this Form relates to the registration of a class of debt securities and is to
become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to General
Instruction A.(c)(2), please check the following box. [ ]
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
None Not Applicable
------------------- -----------------------------
Securities to be registered pursuant to section 12(g) of the Act:
Units
----------------
(Title of class)
<PAGE>
Item 1. Description of Registrant's Securities to be Registered.
The description of the Registrant's Units, is incorporated herein by
reference to "Description of the Units" set forth on pages S-127 to S-131 of
Registrant's Prospectus Supplement, dated November 8, 1999, as filed with the
Commission on November 12, 1999.
Item 2. Exhibits.
2.1 Specimen of Unit.
2.2 Specimen of Trust Preferred Security (Incorporated herein by reference
to Exhibit A to Exhibit 2.1 of this Form 8-A).
2.3 Specimen of Warrant (Incorporated herein by reference to Exhibit B to
Exhibit 2.1 of this Form 8-A).
2.4 Articles of Incorporation of Sovereign Bancorp, (Incorporated herein by
reference to Exhibit 3.1 of the Registrant's Registration Statement No.
333-86961 on Form S-3 filed with the Commission on September 13, 1999).
2.5 Bylaws of Sovereign Bancorp, Inc. (Incorporated herein by reference to
Exhibit 3.2 to Sovereign Bancorp's Annual Report on Form 10-K for the
year ended December 31, 1998).
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly authorized this registration statement to
be signed on its behalf by the undersigned, thereto duly authorized.
SOVEREIGN BANCORP, INC.
(Registrant)
Date: November 12, 1999 By: /s/ Lawrence M. Thompson, Jr.
-----------------------------
Lawrence M. Thompson, Jr.
Chief Administrative Officer
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
2.1 Specimen of Unit.
<PAGE>
Exhibit 2.1
SPECIMEN OF UNIT
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
UNIT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), OR A
NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE UNIT AGREEMENT AND NO TRANSFER OF
THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE 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) MAY BE REGISTERED EXCEPT IN
LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE CONSTITUENT COMPONENTS OF THIS UNIT MUST BE SEPARATED PRIOR TO
TRANSFER (EXCEPT AS PART OF A UNIT) AS PROVIDED IN THE UNIT AGREEMENT."
Certificate No.: ______ Cusip No.: 845905306
Number of Securities: ________
SOVEREIGN BANCORP, INC.
SOVEREIGN CAPITAL TRUST II
Unit Security
This Certificate certifies that Cede & Co. is the registered Holder of
the number of Securities set forth above. Each Security consists of (i)
beneficial ownership by the Holder of one Preferred Security (the "Preferred
Security") of Sovereign Capital Trust II, a Delaware statutory business trust
(the "Trust"), having a stated liquidation amount of $50, the form of which is
attached as Exhibit A hereto and (ii) the rights and obligations of the Holder
under one Warrant to purchase common shares of Sovereign Bancorp, Inc., a
Pennsylvania corporation (the "Company"), the form of which is attached as
Exhibit B hereto. All capitalized terms used herein which are defined in the
Unit Agreement (as defined on the reverse hereof) have the meaning set forth
therein.
Distributions on any Preferred Security forming part of a Security
evidenced hereby, which are payable quarterly in arrears on February 15, May 15,
1
<PAGE>
August 15, and November 15 of each year, commencing on February 15, 2000 (a
"Payment Date"), shall, subject to receipt thereof by the Agent, be paid to the
Person in whose name this Certificate (or a Predecessor Certificate) is
registered at the close of business on the Record Date for such Payment Date,
except that the proceeds of a Remarketing will be paid to the Warrant Agent in
satisfaction of each Electing Remarketing Holder's obligations to pay the
Exercise Price of Warrants constituting a part of this Security.
Distributions on the Preferred Securities will be payable at the office
of the Agent in The City of New York or, at the option of Sovereign, by check
mailed to the address of the Person entitled thereto as such address appears on
the Register.
Reference is hereby made to the further provisions 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 Agent by manual signature, this Certificate shall not be entitled to any
benefit under the Unit Agreement, the Warrant Agreement or the Declaration or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the undersigned have caused this instrument to be
duly executed.
SOVEREIGN BANCORP, INC.
By:
----------------------------------
Name:
Title:
SOVEREIGN CAPITAL TRUST II
By:
----------------------------------
Name:
Title: Administrative Trustee
2
<PAGE>
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Unit Agreement.
Dated: By: THE BANK OF NEW YORK, as
Agent
By:
-----------------------------
Authorized Signatory
3
<PAGE>
(FORM OF REVERSE OF CERTIFICATE)
Each Security evidenced hereby is governed by a Unit Agreement, dated
as of November 15, 1999 (as may be supplemented from time to time, the "Unit
Agreement"), among Sovereign, The Bank of New York, as unit agent (including its
successors hereunder, the "Agent"), The Bank of New York, as Warrant Agent, The
Bank of New York, as Property Trustee and Mark R. McCollom and Jacquelyn Blue,
as the initial Administrative Trustees for the Trust, to which Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, Sovereign, and the Holders and of the terms upon which
the Certificates are, and are to be, executed and delivered. Pursuant to the
Unit Agreement, the rights, limitations or rights, obligations, duties and
immunities of the Agent, Sovereign, and the Holders, and the Certificates
include the rights, obligations, duties and immunities set forth in the Warrant
Agreement and the Declaration, to which reference is further made for a
description thereof.
Each Security evidenced hereby consists of (i) beneficial ownership by
the Holder of one Preferred Security of Sovereign Capital Trust II having a
stated liquidation amount of $50, the form of which is attached as Annex A
hereto and (ii) the rights and obligations of the Holder under one Warrant to
purchase common shares of Sovereign, the form of which is attached as Annex B
hereto
Sovereign may, under the circumstances described in the Declaration,
cause a Remarketing of the outstanding Preferred Securities which form a part of
this Security. In connection therewith, Sovereign will, as described in the
Warrant Agreement, redeem all Warrants which form a part of this Security.
In no event may a Holder pay the Exercise Price of a Warrant by
tendering a Preferred Security. In accordance with the terms of the Declaration
and the Unit Agreement, the Holder of this Certificate may pay the Exercise
Price for the shares of Common Stock purchased pursuant to each Warrant
constituting a part of this Security by applying the proceeds of a remarketing
of the related Preferred Securities.
A Holder of a Security who does not affirmatively elect NOT to
participate in a Remarketing on or prior to 5:00 p.m. New York City time on the
seventh Business Day immediately preceding the Remarketing Date, will be deemed
to have consented to participation in such Remarketing. A Holder of a Security
who does not affirmatively elect on or prior to 5:00 p.m. on the Business Day
preceding a Remarketing Settlement Date to exercise the Warrants related to such
Security will be deemed to have consented to a redemption of such Warrants on
the Remarketing Settlement Date. A Remarketing sale will be made by the
Remarketing Agent pursuant to the terms of the Remarketing Agreement on the
Remarketing Date.
A holder may exercise the Warrants which form a part of the Securities
evidenced by this Certificate at any time upon compliance with the procedures
specified in the Warrant Agreement. A Holder of a Security evidenced by this
Certificate who elects to exercise Warrants prior to the Remarketing Settlement
Date shall have the right to require the Trust to repurchase the related
Preferred Securities on the next Required Repurchase Date which is no less than
60 days after the applicable exercise date.
4
<PAGE>
Upon receipt of notice of any meeting at which holders of Preferred
Securities are entitled to vote or upon the solicitation of consents, waivers or
proxies of holders of Preferred Securities, the Agent shall, as soon as
practicable thereafter, mail to the Holders a notice (a) containing such
information as is contained in the notice or solicitation, (b) stating that each
Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Preferred Securities entitled to vote) shall be entitled to instruct the
Agent as to the exercise of the voting rights pertaining to the Preferred
Securities constituting a part of such Holder's Security and (c) stating the
manner in which such instructions may be given. Upon the written request of the
Holders on such record date, the Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Preferred Securities as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of a Security, the Agent shall abstain from voting the Preferred
Security evidenced by such Security.
Upon the liquidation of the Trust, a principal amount of the Debentures
constituting the assets of the Trust and underlying the Preferred Securities
equal to the aggregate Accreted Value of the Preferred Securities shall be
delivered to the Agent in exchange for the Preferred Securities. Thereafter, the
Holders shall have such rights and obligations with respect to the Debentures as
the Holders had in respect of the Preferred Securities and any reference herein
to the Preferred Securities shall be deemed to be a reference to the Debentures.
The Certificates are issuable only in registered form and only in
denominations of a single Security and any integral multiple thereof. The
transfer of any Certificate will be registered and Certificates may be exchanged
as provided in the Unit Agreement. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents
permitted by the Unit Agreement. No service charge shall be required for any
such registration of transfer or exchange, but Sovereign and the Agent may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. A Security shall be separable into its
components, and Securities may be recreated as provided in the Unit Agreement;
provided, however, this Certificate shall not represent more than 5,750,000
Securities. All such adjustments to the equivalent aggregate principal amount of
this Certificate shall be duly recorded by placing an appropriate notation on
the Schedule attached hereto.
The Holder of this Certificate, by its acceptance hereof, expressly
withholds any consent to the assumption (i.e., affirmance) of the Warrant
Agreement or the Warrants by Sovereign or its trustee in the event that
Sovereign becomes the subject of a case under the Bankruptcy Code.
The Holder of this Certificate, by its acceptance hereof, expressly
agrees to be bound by the terms and provisions of the Unit Agreement, the
Warrant Agreement and the Declaration.
Subject to certain exceptions, the provisions of the Unit Agreement may
be amended with the consent of the Holders of a majority in number of the
Securities.
Sovereign, the Agent and its Affiliates and any agent of Sovereign or
the Agent may treat the Person in whose name this Certificate is registered as
the owner of the Security evidenced hereby for the purpose of receiving payments
of distributions payable quarterly on the Preferred Securities and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither Sovereign, the Agent
nor any such agent shall be affected by notice to the contrary.
5
<PAGE>
The Warrants shall not, prior to the exercise thereof, entitle the
Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Unit Agreement, the Warrant Agreement, the Declaration
and all exhibits to each such agreement is available for inspection at the
offices of the Agent.
This Security shall be governed by the laws of the State of New
York, without regard to principles of conflicts of law.
6
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - ---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of _______
-------------------------------------
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
-------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
(Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee)
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee) the within Certificates and all rights thereunder, hereby irrevocably
constituting and appointing attorney to transfer said Certificates on the books
of [Name of Company] with full power of substitution in the premises.
Dated: ___________________ ________________________________________
Signature
NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the
face of the within Certificates in
every particular, without
alteration or enlargement or any
change whatsoever.
Signature Guarantee: ________________________________________
7
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
This Global Certificate shall represent 5,000,000 Securities unless
otherwise indicated below.
The following increases or decreases in this Global
Certificate have been made:
<TABLE>
<CAPTION>
======================================================================================================================
Date Amount of decrease Amount of increase Number of Securities Signature of
in Number of in Number of evidenced by this authorized officer
Securities evidenced Securities evidenced Global Certificate of Agent
by the by the following such
Global Certificate Global Certificate decrease or increase
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE>
EXHIBIT A
[FORM OF PREFERRED SECURITY CERTIFICATE]
This Preferred Security is a Global Preferred Security within the meaning of the
Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Clearing Agency"), or a
nominee of the Clearing Agency. This Preferred Security is exchangeable for
Preferred Securities registered in the name of a person other than the Clearing
Agency or its nominee only in the limited circumstances described in the
Declaration, and no transfer of this Preferred Security (other than a transfer
of this Preferred Security as a whole by the Clearing Agency to a nominee of the
Clearing Agency or by a nominee of the Clearing Agency to the Clearing Agency or
another nominee of the Clearing Agency) may be registered except in limited
circumstances. Unless this certificate is presented by an authorized
representative of the Clearing Agency to Sovereign Capital Trust II or its agent
for registration of transfer, exchange or payment, and any certificate issued is
registered in the name of Cede & Co. or such other name as requested by an
authorized representative of the Clearing Agency (and any payment hereon is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of the Clearing Agency), and except as otherwise provided in the
Declaration, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has
an interest herein.1
CERTIFICATE EVIDENCING PREFERRED SECURITIES
of
SOVEREIGN CAPITAL TRUST II
7.50% Preferred Securities
(stated liquidation amount $50 per Preferred Security)
Certificate No.:____ Number of Preferred Securities ______________
CUSIP No.: US84603L207
Sovereign Capital Trust II, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
______________ (the "Holder") is the registered owner of _________ preferred
securities of the Trust representing undivided beneficial ownership interests in
the assets of the Trust designated the Preferred Securities (stated liquidation
amount $50 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer as provided in the Declaration. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Preferred Securities represented hereby are issued and shall in all respects
be subject to the provisions of the Amended and Restated Declaration of Trust of
9
<PAGE>
the Trust, dated as of November 15, 1999 (as the same may be amended from time
to time (the "Declaration"), among Sovereign Bancorp, Inc., as Sponsor, Mark R.
McCollom and Jacquelyn Blue, as Administrative Trustees, The Bank of New York,
as Property Trustee, and The Bank of New York (Delaware), as Delaware Trustee.
Capitalized terms used but not defined herein shall have the meaning given them
in the Declaration. The Holder is entitled to the benefits of the Guarantee
Agreement, dated as of November 15, 1999, of Sovereign Bancorp, Inc., in respect
of the Preferred Securities. The Sponsor will provide a copy of the Declaration,
the Guarantee and the Indenture (including any supplemental indenture) to a
Holder without charge upon written request to the Sponsor at its principal place
of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Preferred
Securities as evidence of undivided indirect beneficial ownership interests in
the Debentures.
IN WITNESS WHEREOF, the Trust has executed this
certificate this _____ day of _________________, 1999.
SOVEREIGN CAPITAL TRUST II
By:___________________________
Name:
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
This is one of the Preferred Securities referred to in the within-mentioned
Declaration.
Dated: ____________, 1999
THE BANK OF NEW YORK,
as Property Trustee
By:_________________________
Authorized Signatory
10
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
________________________________________________________________
(Insert assignee's social security or tax identification number)
_________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints _________________________ agent to transfer this
Preferred Security Certificate on the books and records of the Trust. The agent
may substitute another to act for him.
Date:
----------------------------
Signature:
-----------------------
(Sign exactly as your name appears on the Preferred Security Certificate)
Signature Guarantee*:
- ---------
* Signature must be guaranteed by an "eligible guarantor institution" that is
a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in
accordance with the Securities and Exchange Act of
1934, as amended.
11
<PAGE>
SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL PREFERRED SECURITY(2)
This Global Preferred Security shall represent 0 Preferred
Securities unless otherwise indicated below.
The following increases or decreases in this Global Preferred
Security have been made:
<TABLE>
<CAPTION>
======================================================================================================================
Date Amount of decrease Amount of increase Number of Preferred Signature of
in Number of in Number of Securities evidenced authorized officer
Preferred Securities Preferred Securities by this of Agent
evidenced by this evidenced by this Global Preferred
Global Preferred Global Preferred Security following
Security Security such
decrease or increase
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------
(2) Insert in Global Preferred Securities only.
12
<PAGE>
EXHIBIT B
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE WERE INITIALLY ISSUED AS PART OF AN
ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF A WARRANT TO PURCHASE 5.3355 SHARES
(SUBJECT TO ANTI-DILUTION ADJUSTMENTS) OF COMMON STOCK OF THE COMPANY AT THE
EXERCISE PRICE SET FORTH IN THE BELOW-REFERENCED WARRANT AGREEMENT AND A
PREFERRED SECURITY OF SOVEREIGN CAPITAL TRUST II (THE "TRUST"). THE WARRANTS AND
THE PREFERRED SECURITIES MAY BE SEPARATED AND TRANSFERRED SEPARATELY, AND
RE-ATTACHED, IN ACCORDANCE WITH THE PROVISIONS OF THE UNIT AGREEMENT.
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE WARRANT
AGREEMENT.]
No. { } Certificate for _____ Warrants
CUSIP No.: 845905116
WARRANTS TO PURCHASE COMMON STOCK OF
SOVEREIGN BANCORP, INC.
THIS CERTIFIES THAT __________, or its registered assigns, is the
registered holder of the number of Warrants set forth above (the "Warrants").
Each Warrant entitles the holder thereof (the "Holder"), at its option and
subject to the provisions contained herein and in the Warrant Agreement referred
to below, to purchase from Sovereign Bancorp, Inc., a Pennsylvania corporation
("the Company"), 5.3355 shares (subject to certain adjustments as set forth in
the Warrant Agreement) of common stock of the Company (the "Common Stock") at
the Exercise Price. This Warrant Certificate shall terminate and become void,
and the related Warrants shall expire, as of 5:00 p.m., New York time, on the
earlier of (i) November 20, 2029 or (ii) the date the Warrants are redeemed by
the Company pursuant to the terms of the Warrant Agreement, as described below
13
<PAGE>
(the "Expiration Date"), or upon the earlier exercise hereof as to all the
shares of Common Stock subject hereto. The number of shares issuable upon
exercise of the Warrants shall be subject to adjustment from time to time as set
forth in the Warrant Agreement.
This Warrant Certificate is issued under and in accordance
with a Warrant Agreement dated as of November 15, 1999 (the "Warrant
Agreement"), between the Company and The Bank of New York, as warrant agent (the
"Warrant Agent", which term includes any successor Warrant Agent under the
Warrant Agreement), and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which terms and provisions the Holder of this
Warrant Certificate consents by acceptance hereof. The Warrant Agreement is
hereby incorporated herein by reference and made a part hereof. Reference is
hereby made to the Warrant Agreement for a full statement of the respective
rights, limitations of rights, duties and obligations of the Company, the
Warrant Agent and the Holders of the Warrants. Capitalized terms used but not
defined herein shall have the meanings ascribed thereto in the Warrant
Agreement. A copy of the Warrant Agreement may be obtained for inspection by the
Holder hereof upon written request to the Warrant Agent at its address for
notices specified in the Warrant Agreement.
Subject to redemption as described below, the Holder of this Warrant
Certificate shall have the right, prior to the Expiration Date, at such Holder's
option, to exercise the related Warrant and purchase the Exercise Amount
(subject to certain adjustments set forth in the Warrant Agreement) of Common
Stock at the Exercise Price, provided that the Exercise Conditions are met as of
such date. If the Warrant evidenced by this Warrant Certificate is not exercised
at or before 5:00 p.m., New York time, on its Expiration Date, such Warrant
shall become void, and all rights of the Holder of this Warrant Certificate
hereunder and under the Warrant Agreement shall cease. The Warrant or Warrants
evidenced by this Warrant Certificate may be exercised by giving notice to the
Warrant Agent no later than 5:00 p.m., New York time, on the Business Day
preceding the proposed date of exercise of such Warrants and completing the form
of election to purchase set forth on the reverse hereof, and delivering the
same, together with this Warrant Certificate (if this Warrant Certificate shall
then be held in definitive form), to the Warrant Agent no later than 5:00 p.m.,
New York time, on the date of such exercise, together with a Cash Payment
(unless, in accordance with the Warrant Agreement, a Remarketing Payment is to
be made). In no event may a Holder satisfy its obligation to pay the Exercise
Price by tendering Preferred Securities.
On the date of exercise of the Warrant or Warrants evidenced by this
Warrant Certificate, the Company shall issue, and the Warrant Agent shall
deliver, to or upon the order of the Holder hereof, the Exercise Amount of
Common Stock to which such Holder is entitled, registered in such name or names
as may be directed by such Holder. The date on which this Warrant Certificate
and payment are received by the Warrant Agent as aforesaid shall be deemed to be
the date on which the related Warrant is exercised and the related Common Stock
is issued.
Notwithstanding anything to the contrary in this Warrant Certificate or
in the Warrant Agreement, (i) no fractional shares of Common Stock shall be
issued by the Company upon the exercise of any Warrant, (ii) if more than one
Warrant shall be exercised at the same time by the same Holder, the number of
shares of Common Stock issuable in connection with such exercise shall be
computed on the basis of the aggregate Exercise Amount of the Warrants so
exercised, and (iii) on the date a Holder exercises such Holder's Warrant, the
Company shall pay such Holder an amount in cash equal to the then-current Market
Price (multiplied by the related fraction) of Common Stock for such fractional
shares, computed to the nearest whole cent.
14
<PAGE>
If fewer than all of the Warrants evidenced by this Warrant Certificate
are exercised, the Company shall execute, and an authorized officer of the
Warrant Agent shall countersign and deliver, a new Warrant Certificate
evidencing the number of Warrants remaining unexercised.
The "Exercise Conditions" require that, with respect to any Warrant on
any date on which such Warrant is or is proposed to be exercised by the Holder
thereof, that (i) (a) the Company shall have a registration statement in effect
under the Securities Act covering the issuance and sale of the related Exercise
Amount of Common Stock upon exercise of such Warrant, or (b) the sale of such
shares of Common Stock shall be exempt from the registration requirements of the
Securities Act, (ii) such shares of Common Stock shall have been registered,
qualified or are deemed to be exempt under the securities laws of the state of
residence of the exercising Holder, and (iii) a then-current prospectus relating
to the Common Stock shall be delivered to such exercising Holder.
As provided in the Warrant Agreement, the number of shares of Common
Stock issuable upon the exercise of the Warrants is subject to an anti-dilution
adjustment upon the happening of certain events. The Warrant Agreement also
provides for certain adjustments and/or distributions in the event of certain
events relating to a merger or combination of the Company, and similar events.
Subject to satisfaction of the Exercise Conditions and certain other
conditions, the Company may elect to cause a remarketing of the Preferred
Securities and a contemporaneous redemption of the Warrants on the Redemption
Date, for cash, in an amount equal to the Warrant Value as of the Remarketing
Date, in accordance with the Warrant Agreement and related agreements.
A Holder (i) may elect to exercise a Warrant in lieu of Redemption, if
(A) such Warrant is held pursuant to the Unit Agreement, and such Holder has
opted out of participating in the Remarketing, by notice given to the Warrant
Agent and the Unit Agent; or (B) such Warrant is not held pursuant to the Unit
Agreement, by notice given to the Warrant Agent, in each case prior to 5:00
p.m., New York time, on the Business Day prior to the related Redemption Date;
and (ii) as provided in the Unit Agreement, shall be deemed to have elected to
exercise such Warrant in lieu of Redemption, if such Warrant is held pursuant to
the Unit Agreement and such Holder has not opted out of participating in the
Remarketing. In the absence of an election to exercise a Warrant in lieu of a
Redemption, including a deemed election pursuant to clause (ii) of the preceding
sentence, a Holder will be deemed to have elected to have its Warrants redeemed
on the Redemption Date.
If a Holder elects or is deemed to have elected to exercise a Warrant
pursuant to the preceding paragraph, then such Holder must tender the Exercise
Price for such Warrant as a Cash Payment, and must follow certain procedures set
forth in the Warrant Agreement; provided, however, that if (i) such Warrant is,
on the Remarketing Date, held pursuant to the Unit Agreement, (ii) such Holder
has not opted out of participating in the Remarketing, and (iii) a Successful
Remarketing shall have occurred, then the Exercise Price of such Warrant will be
deemed to have been paid by a Remarketing Payment, and the Remarketing Agent
will, in connection with such Remarketing Payment, apply the proceeds of the
Remarketing of the related Preferred Security in accordance with the terms of
the Remarketing Agreement and the Unit Agreement.
15
<PAGE>
Any Warrant so redeemed or exercised will, upon such redemption or
exercise, cease to be outstanding.
If a Redemption cannot occur because of an inability, following the
Company's best efforts, to satisfy the Redemption Conditions, the Company will
promptly notify the Warrant Agent and each Holder (at its address specified in
the Warrant Register) thereof. Such event will not constitute a default under
the Warrant Agreement so long as the Company is not otherwise in violation
thereof; and the Company may, under such circumstances, subsequently seek to
remarket the Preferred Securities and contemporaneously redeem the Warrants.
The Company will, contemporaneously with the giving of notice of
Remarketing, furnish notice of Redemption to the Warrant Agent, which will,
within ___ Business Days of receipt of such notice, furnish notice thereof to
the Holders of Definitive Warrants, and the Company will request, not later than
15 nor more than 30 calendar days prior to the Remarketing Date, that DTC notify
its Participants holding Warrants of the Remarketing.
The Company may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with the transfer or
exchange of the Warrant Certificates pursuant to the Warrant Agreement, but not
for any exchange or original issuance (not involving a transfer) with respect to
temporary Warrant Certificates, the exercise of the Warrants or the issuance of
the Common Stock.
This Warrant Certificate may be exchanged at the office of the Warrant
Agent by presenting this Warrant Certificate properly endorsed with a request to
exchange this Warrant Certificate for other Warrant Certificates evidencing an
equal number of Warrants, in accordance with the Warrant Agreement.
All shares of Common Stock issuable by the Company upon the exercise of
the Warrants shall, upon such issue, be duly and validly issued and fully paid
and non-assessable.
The holder in whose name this Warrant Certificate is registered may be
deemed and treated by the Company and the Warrant Agent as the absolute owner of
this Warrant Certificate for all purposes whatsoever and neither the Company nor
the Warrant Agent shall be affected by notice to the contrary.
Neither this Warrant Certificate, nor the Warrant evidenced hereby,
entitles the Holder hereof to any of the rights of a shareholder of the Company.
This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.
SOVEREIGN BANCORP, INC.
By:
-------------------------------
Name:
Title:
16
<PAGE>
DATED:
Countersigned:
- ------------------------------
THE BANK OF NEW YORK,
as Warrant Agent
By
----------------------------
Authorized Signatory
17
<PAGE>
FORM OF ELECTION TO PURCHASE COMMON STOCK
(to be executed only upon exercise of Warrants)
SOVEREIGN BANCORP, INC.
The undersigned hereby irrevocably elects to exercise ___ Warrants at
an Exercise Price of $______ per Warrant to acquire the Exercise Amount (as
determined pursuant to the Warrant Agreement) per Warrant of Common Stock of
Sovereign Bancorp, Inc. on the terms and conditions specified within this
Warrant Certificate and the Warrant Agreement therein referred to, surrenders
this Warrant Certificate and all right, title and interest therein and directs
that the shares of Common Stock deliverable upon such exercise be registered or
placed in the name and at the address specified below and delivered thereto.
The signature below must correspond with the name as written upon the
face of the within Warrant Certificate in every particular, without alteration
or enlargement or any change whatsoever, and must be guaranteed.
Dated: ____________, ____
-------------------------------------
(Signature of Holder)
-------------------------------------
(Street Address)
-------------------------------------
(City) (State) (Zip Code)
Signature Guaranteed by:
-------------------------------------
{Signature must be guaranteed by an
eligible guarantor institution (banks,
stock brokers, savings and loan
associations and credit unions) with
membership in an approved guarantee
medallion program pursuant to
Securities and Exchange Commission Rule
17Ad-5)
18
<PAGE>
Common Stock to be issued to:
Please insert social security or identifying number:
Name:____________________________________________
Street Address:__________________________________
City, State and Zip Code:________________________
Any unexercised Warrants represented by the Warrant Certificate to be issued to:
Please insert social security or identifying number:
Name:____________________________________________
Street Address:__________________________________
City, State and Zip Code:________________________
19
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
This Global Certificate shall represent [0] Warrants unless otherwise
indicated below.
The following increases or decreases in this Global
Certificate have been made:
<TABLE>
<CAPTION>
======================================================================================================================
Date Amount of decrease Amount of increase Number of Warrants Signature of
in Number of in Number of evidenced by the authorized officer
Warrants evidenced Warrants evidenced Global Certificate of Agent
by the Global by the Global following such
Certificate Certificate decrease or increase
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
20
