As filed with the Securities and Exchange Commission on September 24, 1997
Registration No. 333-____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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Banknorth Group, Inc. Banknorth Capital Trust I
(Exact name of registrant as (Exact name of registrant as
specified in its charter) specified in its charter)
Delaware Delaware
(State of incorporation) (State of incorporation)
_________ ___________
(Primary Standard Industrial (Primary Standard Industrial)
Classification Code Number) Classification Code Number
03-0321189 (Applied for)
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
300 Financial Plaza
Burlington, Vermont 05401
(802) 658-9959
(Address, including zip code, and telephone number, including area code, of
registrants' principal executive offices)
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Thomas J. Pruitt Thomas J. Pruitt
Executive Vice President Administrative Trustee
and Chief Financial Officer Banknorth Capital Trust I
Banknorth Group, Inc. 300 Financial Plaza
300 Financial Plaza Burlington, Vermont 05401
Burlington, Vermont 05401 (802) 658-9959
(802) 658-9959
(Address, including zip code, and telephone number,
including area code, of agents for service)
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Copies to:
Edward F. Petrosky, Esq.
Brown & Wood LLP
One World Trade Center
New York, New York 10048
Approximate date of commencement of proposed sale of the securities to
the public. As soon as practicable after this 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. |_|
<TABLE>
<CAPTION>
Calculation of Registration Fee
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Amount Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Securities to be Offering Price Aggregate Registration
to be Registered Registered Per Unit (1) Offering Price (1) Fee
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<C> <C> <C> <C> <C>
10.52% Capital Securities, Series B, of Banknorth Capital $30,000,000 100% $30,000,000 $9,091
Trust I
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10.52% Junior Subordinated Deferrable Interest Debentures,
Series B, of Banknorth Group, Inc. (2)
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Series B Capital Securities Guarantee of Banknorth Group,
Inc. (3)
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Total (4) $30,000,000(5) 100% $30,000,000 $9,091
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</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) No separate consideration will be received for the 10.52% Junior
Subordinated Deferrable Interest Debentures, Series B, of Banknorth Group,
Inc. distributed upon any liquidation of Banknorth Capital Trust I.
(3) No separate consideration will be received for the Series B Capital
Securities Guarantee of Banknorth Group, Inc.
(4) This Registration Statement is deemed to cover rights of holders of 10.52%
Junior Subordinated Deferrable Interest Debentures, Series B, under the
Indenture, the rights of holders of 10.52% Capital Securities, Series B,
under the Trust Agreement and under the Series B Capital Securities
Guarantee and certain backup undertakings as described herein.
(5) Such amount represents the liquidation amount of 10.52% Capital Securities,
Series B, to be exchanged hereunder and under the principal amount of 10.52%
Junior Subordinated Deferrable Interest Debentures, Series B, that may be
distributed to holders of such Capital Securities upon any liquidation of
Banknorth Capital Trust I.
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The Registrants hereby amend this registration statement on such date or dates
as may be necessary to delay its effective date until the Registrants shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
(A redherring appears on the left-hand side of this page, rotated 90 degrees.
Text follows.)
Information contained herein is subject to completion or amendment. A
Registration Statement relating to these Securities has been filed with the
Securities and Exchange Commission. These Securities may not be sold nor may
offers to buy be accepted prior to the time the Registration Statement becomes
effective. This Prospective Supplement shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there by any sale of these
Securities in any jurisdiction in which such offer, solicitation or sale would
be unlawful prior to the registration or qualification under the securities laws
of any such jurisdiction.
SUBJECT TO COMPLETION, DATED SEPTEMBER 24, 1997
PROSPECTUS
BANKNORTH CAPITAL TRUST I
OFFER TO EXCHANGE ITS
10.52% CAPITAL SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
10.52% CAPITAL SECURITIES, SERIES A
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
BANKNORTH GROUP, INC.
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON _________, 1997, UNLESS EXTENDED.
Banknorth Capital Trust I, a trust formed under the laws of the state of
Delaware (the "Trust"), hereby offers, 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 and including $30,000,000 aggregate Liquidation Amount of its 10.52% Capital
Securities, Series B (the "Exchange 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 its outstanding
10.52% Capital Securities, Series A (the "Original Capital Securities"), of
which $30,000,000 aggregate Liquidation Amount is outstanding. Pursuant to the
Exchange Offer, Banknorth Group, Inc., a Delaware corporation (the "Corporation"
or "Banknorth"), is also offering to exchange (i) its guarantee of payments of
cash distributions and payments on liquidation of the Trust or redemption of the
Exchange Capital Securities (the "Exchange Guarantee") for a like guarantee in
respect of the Original Capital Securities (the "Original Guarantee") and (ii)
its 10.52% Junior Subordinated Deferrable Interest Debentures due May 1, 2027,
Series B (the "Exchange Junior Subordinated
(Continued on next page)
This Prospectus and the Letter of Transmittal are first mailed to all holders of
Original Capital Securities on or about ____________, 1997.
See "Risk Factors" beginning on page for certain information that should be
considered by holders in deciding whether to tender Original Capital Securities
in the Exchange Offer.
THE SECURITIES OFFERED HEREBY ARE NOT DEPOSITS OR OTHER OBLIGATIONS
OF A BANK AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is September __, 1997.
<PAGE>
(Continued from the previous page)
Debentures") for its 10.52% Junior Deferrable Interest Debentures due May 1,
2027, Series A (the "Original Junior Subordinated Debentures"), in an aggregate
principal amount corresponding to the aggregate Liquidation Amount of Original
Capital Securities accepted for exchange, which Exchange Guarantee and Exchange
Junior Subordinated Debentures also have been registered under the Securities
Act. The Original Capital Securities, the Original Guarantee and the Original
Junior Subordinated Debentures are collectively referred to herein as the
"Original Securities" and the Exchange Capital Securities, the Exchange
Guarantee and the Exchange Junior Subordinated Debentures are collectively
referred to herein as the "Exchange Securities."
The terms of the Exchange Securities are identical in all material
respects to the respective terms of the Original Securities, except that (i) the
Exchange Securities have been registered under the Securities Act and therefore
will not be subject to certain restrictions on transfer applicable to the
Original Securities, (ii) the Exchange Capital Securities will not provide for
any increase in the Distribution rate thereon and (iii) the Exchange Junior
Subordinated Debentures will not provide for any liquidated damages thereon.
See "Description of Exchange Securities" and "Description of Original
Securities." The Exchange Capital Securities are being offered for exchange in
order to satisfy certain obligations of the Corporation and the Trust under the
Registration Rights Agreement, dated as of May 1, 1997 (the "Registration Rights
Agreement"), among the Corporation, the Trust and Sandler O'Neill & Partners,
L.P. (the "Initial Purchaser"). In the event that the Exchange Offer is
consummated, any Original Capital Securities that remain outstanding after
consummation of the Exchange Offer and the Exchange 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 (as defined herein).
The Exchange Capital Securities and the Original Capital Securities
(together, the "Capital Securities") represent beneficial interests in the
assets of the Trust. The Corporation is the owner of all of the beneficial
interests represented by common securities of the Trust (the "Common
Securities," and together with the Capital Securities, the "Trust Securities").
The First National Bank of Chicago is the Property Trustee (the "Property
Trustee") of the Trust. The Trust exists for the sole purpose of issuing the
Trust Securities and investing the proceeds thereof in the Junior Subordinated
Debentures (as defined herein). The Exchange Junior Subordinated Debentures will
mature on May 1, 2027 (the "Stated Maturity Date"). The Exchange Capital
Securities will have a preference over the Common Securities under certain
circumstances with respect to cash distributions and amounts payable on
liquidation, redemption or otherwise. See "Description of Exchange
Securities--Description of Exchange Capital Securities--Subordination of Common
Securities".
As used herein, (i) the "Indenture" means the Indenture, dated as of
May 1, 1997, as amended and supplemented from time to time, between the
Corporation and The First National Bank of Chicago, as Trustee (the "Debenture
Trustee"), relating to the Junior Subordinated Debentures and (ii) the "Trust
Agreement" means the Amended and Restated Declaration of Trust relating to the
Trust, dated as of May 1, 1997, among the Corporation, as Sponsor, The First
National Bank of Chicago, as Property Trustee, First Chicago Delaware Inc., as
Delaware Trustee (the "Delaware Trustee"), and the Administrative Trustees named
therein (collectively, with the Property Trustee and Delaware Trustee, the
"Issuer Trustees"). In addition, as the context may require, (i)"Junior
Subordinated Debentures" includes the Original Junior Subordinated Debentures
and the Exchange
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Junior Subordinated Debentures and (ii) "Guarantee" includes the Original
Guarantee and the Exchange Guarantee.
Holders of the Exchange Capital Securities will be entitled to receive
cumulative cash distributions arising from the payment of interest on the
Exchange Junior Subordinated Debentures, accumulating from May 1, 1997 (to the
extent that the Original Capital Securities are accepted for exchange on or
prior to October 15, 1997) or November 1, 1997 (to the extent that the Original
Capital Securities are accepted for exchange after October 15, 1997), payable
semi-annually in arrears on May 1 and November l of each year, commencing
November 1, 1997 or May 1, 1998, as the case may be, at the annual rate of
10.52% of the Liquidation Amount of $1,000 per Exchange Capital Security
("Distributions"). So long as no Debenture Event of Default (as defined herein)
has occurred and is continuing, the Corporation has the right to defer payments
of interest on the Exchange Junior Subordinated Debentures for a period not
exceeding 10 consecutive semi-annual periods to each deferral period (each, an
"Extension Period"), provided that an Extension Period must end on an Interest
Payment Date (as defined herein) and may not extend beyond the Stated Maturity
Date. Upon the termination of any such Extension Period and the payment of all
amounts then due, the Corporation may elect to begin a new Extension Period,
subject to the requirements set forth herein. If and for so long as interest
payments on the Exchange Junior Subordinated Debentures are so deferred,
Distributions on the Exchange Capital Securities also will be deferred, and the
Corporation will not be permitted, subject to certain exceptions described
herein, to declare or pay any cash distributions with respect to the
Corporation's capital stock or to make any payment with respect to debt
securities of the Corporation that rank pari passu with or junior to the
Exchange Junior Subordinated Debentures.
During an Extension Period, interest on the Exchange Junior
Subordinated Debentures will continue to accrue (and the amount of Distributions
to which holders of the Exchange Capital Securities are entitled will continue
to accumulate) at the rate of 10.52% per annum, compounded semi-annually, and
holders of Trust Securities will be required to include deferred interest income
in their gross income for United States federal income tax purposes prior to the
receipt of the cash attributable to such income. See "Description of Exchange
Securities-Description of Exchange Junior Subordinated Debentures--Option to
Extend Interest Payment Date" and "Certain Federal Income Tax
Consequences--Interest Income and Original Issue Discount." Distributions to
which holders of the Trust Securities are entitled during any such Extension
Period will accumulate additional Distributions thereon at the rate per annum of
10.52% thereof, compounded semi-annually from the relevant Distribution Date,
but not exceeding the interest rate then accruing on the Exchange Junior
Subordinated Debentures. The term "Distributions," as used herein, shall include
any such additional Distributions.
Through the Guarantee, the guarantee of the Corporation relating to the
Common Securities (the "Common Guarantee"), the Trust Agreement, the Junior
Subordinated Debentures and the Indenture, taken together, the Corporation has
guaranteed or will guarantee, as the case may be, all of the Trust's obligations
under the Trust Securities. See "Relationship Among the Exchange Capital
Securities, the Exchange Junior Subordinated Debentures and the Exchange
Guarantee--Full and Unconditional Guarantee." The Exchange Guarantee and the
Common Guarantee will guarantee payments of Distributions and payments upon
liquidation of the Trust or redemption of the Exchange Capital Securities and
Common Securities, but in each case only to the extent that the Trust has funds
legally available therefor and has failed to make such payments, as described
herein. See "Description of Exchange Securities--Description of Exchange
Guarantee." If the Corporation fails to make a required payment on the Exchange
Junior Subordinated Debentures, the Trust will not have sufficient funds to make
the related payments, including Distributions, on the Trust Securities. The
Exchange Guarantee will not cover any such payment when the Trust does not have
sufficient funds legally available therefor. In such event, a holder of Exchange
Capital Securities may institute a legal
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proceeding directly against the Corporation to enforce its rights in respect of
such payment. See "Description of Exchange Securities--Description of Exchange
Junior Subordinated Debentures--Enforcement of Certain Rights by Holders of
Exchange Capital Securities." The obligations of the Corporation under the
Exchange Guarantee, the Common Guarantee and the Exchange Junior Subordinated
Debentures will be unsecured and will rank subordinate and junior in right of
payment to all Senior Indebtedness (as defined in "Description of Exchange
Securities-Description of Exchange Junior Subordinated
Debentures--Subordination"). See "Risk Factors--Ranking of Subordinated
Obligations under the Exchange Guarantee and the Exchange Junior Subordinated
Debentures: Limitation on Source of Funds."
The Trust Securities will be subject to mandatory redemption in a Like
Amount (as defined herein), (i) in whole but not in part, on the Stated Maturity
Date upon repayment of the Exchange Junior Subordinated Debentures at a
redemption price equal to the principal amount of, plus accrued and unpaid
interest on, the Exchange Junior Subordinated Debentures (the "Maturity
Redemption Price"), (ii) in whole but not in part, at any time prior to May 1,
2007 (the "Initial Optional Redemption Date"), contemporaneously with the
optional prepayment of the Exchange Junior Subordinated Debentures by the
Corporation, upon the occurrence and continuation of a Special Event (as defined
herein) at a redemption price equal to the Special Event Prepayment Price (as
defined herein) (the "Special Event Redemption Price"), and (iii) in whole or in
part, on or after the Initial Optional Redemption Date, contemporaneously with
the optional prepayment by the Corporation of all or part of the Exchange Junior
Subordinated Debentures, at a redemption price equal to the Optional Prepayment
Price (as defined herein) (the "Optional Redemption Price"). Any of the Maturity
Redemption Price, the Special Event Redemption Price and the Optional Redemption
Price may be referred to herein as the "Redemption Price." See "Description of
Exchange Securities--Description of Exchange Capital Securities--Redemption."
Subject to the Corporation having received any required regulatory
approvals, the Exchange Junior Subordinated Debentures will be prepayable prior
to the Stated Maturity Date at the option of the Corporation (i) on or after the
Initial Optional Redemption Date, in whole or in part, at a price (the "Optional
Prepayment Price") equal to 105.260% of the principal amount thereof on the
Initial Optional Redemption Date, declining ratably on each May 1 thereafter to
100% on or after May 1, 2017 or (ii) at any time prior to the Initial Optional
Redemption Date, in whole but not in part, upon the occurrence and continuation
of a Special Event, at a prepayment price (the "Special Event Prepayment Price")
equal to the Make-Whole Amount (as defined herein). The "Make-Whole Amount"
shall be equal to the greater of (a) 100% of the principal amount thereof or (b)
the sum, as determined by a Quotation Agent (as defined herein), of the present
values of the remaining scheduled payments of principal and interest on the
Exchange Junior Subordinated Debentures, discounted to the prepayment date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Adjusted Treasury Rate (as defined herein) plus, in the case of each of
clauses (a) and (b), accrued and unpaid interest thereon, including Compounded
Interest and Additional Sums (as defined herein), if any, to the date of
prepayment. Either of the Optional Prepayment Price or the Special Event
Prepayment Price may be referred to herein as the "Prepayment Price." See
"Description of Exchange Securities--Description of Exchange Junior Subordinated
Debentures--Optional Prepayment" and "--Special Event Prepayment."
The Corporation has the right at any time to terminate the Trust and,
after satisfaction of liabilities of creditors of the Trust as required by
applicable law, to cause a Like Amount of the Junior Subordinated Debentures to
be distributed to the holders of the Trust Securities in liquidation of the
Trust, subject to the Corporation's having received (i) an opinion of counsel to
the effect that such distribution will not be a taxable event to the holders of
Exchange Capital Securities and (ii) any
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required regulatory approvals. Unless the Junior Subordinated Debentures are
distributed to the holders of the Trust Securities, in the event of a
liquidation of the Trust as described herein, after satisfaction of liabilities
to creditors of the Trust as required by applicable law, the holders of the
Trust Securities generally will be entitled to receive a Liquidation Amount of
$1,000 per Trust Security plus accumulated and unpaid Distributions thereon to
the date of payment. See "Description of Exchange Securities--Description of
Exchange Capital Securities--Liquidation of the Trust and Distribution of
Exchange Junior Subordinated Debentures."
THE CAPITAL SECURITIES, INCLUDING THE EXCHANGE CAPITAL SECURITIES, MAY
BE TRANSFERRED ONLY IN A BLOCK HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN
$100,000 (100 CAPITAL SECURITIES). ANY TRANSFER OF EXCHANGE 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 EXCHANGE CAPITAL SECURITIES FOR ANY PURPOSE,
INCLUDING BUT NOT LIMITED TO THE RECEIPT OF DISTRIBUTIONS ON SUCH EXCHANGE
CAPITAL SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST
WHATSOEVER IN SUCH EXCHANGE CAPITAL SECURITIES.
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The Trust is making the Exchange Offer of the Exchange Capital
Securities in reliance on the position of the staff of the Division of
Corporation Finance (the "Staff') of the Securities and Exchange Commission (the
"Commission") as set forth in certain interpretive letters addressed to third
parties in other transactions. However, neither the Corporation nor the Trust
has sought its own interpretive 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 it has in such interpretive letters to third parties. Based on
these interpretations by the Staff of the Commission, and subject to the two
immediately following sentences, the Corporation and the Trust believe that
Exchange Capital Securities issued pursuant to this Exchange Offer in exchange
for Original Capital Securities may be offered for resale, resold and otherwise
transferred by a holder thereof (other than a holder who is a broker-dealer)
without further compliance with the registration and prospectus delivery
requirements of the Securities Act, provided that such Exchange Capital
Securities are acquired in the ordinary course of such holder's business and
that such holder is not participating, and has no arrangement or understanding
with any person to participate, in a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. However, any holder of
Original Capital Securities who is an "affiliate" of the Corporation or the
Trust or who intends to participate in the Exchange Offer for the purpose of
distributing Exchange Capital Securities, or any broker-dealer who purchased
Original Capital Securities from the Trust for resale pursuant to Rule 144A
under the Securities Act ("Rule 144A") or any other available exemption under
the Securities Act, (i) will not be able to rely on the interpretations of the
Staff of the Commission set forth in the above-mentioned interpretive letters,
(ii) will not be permitted or entitled to tender such Original 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 Original Capital Securities unless such sale is
made pursuant to an exemption from such requirements. In addition, as described
herein, if any broker-dealer holds Original Capital Securities acquired for its
own account as a result of market-making or other trading activities and
exchanges such Original Capital Securities for Exchange Capital Securities, then
such broker-dealer must deliver a prospectus meeting the requirements of the
Securities Act in connection with any resales of such Exchange Capital
Securities.
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Each holder of Original Capital Securities who wishes to exchange
Original Capital Securities for Exchange Capital Securities in the Exchange
Offer will be required to represent that (i) it is not an "affiliate" of the
Corporation or the Trust, (ii) any Exchange Capital Securities to be received by
it are being acquired in the ordinary course of its business, (iii) it has no
arrangement or understanding with any person to participate in a distribution
(within the meaning of the Securities Act) of such Exchange Capital Securities,
and (iv) if such holder is not a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. In addition, the
Corporation and the Trust may require such holder, as a condition to such
holder's eligibility to participate in the Exchange Offer, to furnish to the
Corporation and the Trust (or an agent thereof) in writing information as to the
number of "beneficial owners" (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), on behalf of
whom such holder holds the Original Capital Securities to be exchanged in the
Exchange Offer. Each broker-dealer that receives Exchange Capital Securities for
its own account pursuant to the Exchange Offer must acknowledge that it acquired
the Original Capital Securities for its own account as the result of market
making activities or other trading activities and must agree that it will
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange 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 of the
Commission in the interpretive letters referred to above, the Corporation and
the Trust believe that broker-dealers who acquired Original 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 Exchange Capital Securities received
upon exchange of such Original Capital Securities (other than Original Capital
Securities which represent an unsold allotment from the initial sale of the
Original 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 Exchange Capital Securities. Each broker-dealer that receives
Exchange 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 Exchange 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 Exchange Capital
Securities received in exchange for Original Capital Securities acquired by such
broker-dealer as a result of market-making activities or other trading
activities. The Trust and the Corporation have agreed that, ending on the close
of business on the 90th day following the Expiration Date (as defined herein),
it will make this Prospectus available to any broker-dealer for use in
connection with any such resale. See "Plan of Distribution." However, a
Participating Broker-Dealer who intends to use this Prospectus in connection
with the resale of Exchange Capital Securities received in exchange for Original
Capital Securities pursuant to the Exchange Offer must notify the Corporation or
the Trust, or cause the Corporation or the Trust to be notified, on or prior to
the Expiration Date, that it is a Participating Broker-Dealer. Such notice may
be given in the space provided for that purpose in the Letter of Transmittal or
may be delivered to The First National Bank of Chicago (the "Exchange Agent") at
the address set forth herein under "The Exchange Offer--Exchange Agent." Any
Participating Broker-Dealer who is an "affiliate" of the Corporation or the
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
Exchange Capital Securities."
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In that regard, each Participating Broker-Dealer who surrenders
Original 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 Corporation or the Trust of the occurrence of any event or the
discovery of any fact that (i) makes any statement contained or incorporated by
reference in this Prospectus untrue in any material respect or (ii) causes this
Prospectus to omit to state a material fact necessary in order to make the
statements contained or incorporated by reference herein, in the light of the
circumstances under which they were made, not misleading, or upon the occurrence
of certain other events specified in the Registration Rights Agreement, such
Participating Broker-Dealer will suspend the sale of Exchange Capital Securities
(or the Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) pursuant to this Prospectus until the Corporation or the 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 Corporation or the Trust has given notice
that the sale of the Exchange Capital Securities (or the Exchange Guarantee or
the Exchange Junior Subordinated Debentures, as applicable) may be resumed, as
the case may be. If the Corporation or the Trust gives such notice to suspend
the sale of the Exchange Capital Securities (or the Exchange Guarantee or the
Exchange Junior Subordinated Debentures, as applicable), it shall extend the
90-day period referred to above during which Participating Broker-Dealers are
entitled to use this Prospectus in connection with the resale of Exchange
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 amended or
supplemented Prospectus necessary to permit resales of the Exchange Capital
Securities or to and including the date on which the Corporation or the Trust
has given notice that the sale of Exchange Capital Securities (or the Exchange
Guarantee or the Exchange 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 Original Capital Securities. The Exchange
Capital Securities will be a new issue of securities for which there currently
is no market. Accordingly, there can be no assurance as to the development or
liquidity of any market for the Exchange Capital Securities. The Corporation and
the Trust do not intend to apply for listing of the Exchange Capital Securities
on any securities exchange or for inclusion in the Nasdaq Stock Market, the
electronic securities market operated by the National Association of Securities
Dealers, Inc. ("Nasdaq").
Any Original 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). Following consummation of the Exchange Offer, the holders
of Original Capital Securities will continue to be subject to all of the
existing restrictions upon transfer thereof and neither the Corporation nor the
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 Original Capital Securities held by them. To the extent that Original
Capital Securities are tendered and accepted in the Exchange Offer, a holder's
ability to sell untendered Original Capital Securities could be adversely
affected. See "Risk Factors--Consequences of a Failure to Exchange Original
Capital Securities."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF ORIGINAL CAPITAL SECURITIES ARE URGED TO READ THIS
PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING
WHETHER TO TENDER THEIR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE
OFFER.
7
<PAGE>
Original Capital Securities may be tendered for exchange on or prior to
5:00 p.m., New York City time, on _____, 1997 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by the Corporation or the Trust (in which case the term "Expiration Date" shall
mean the latest date and time to which the Exchange Offer is extended). Tenders
of Original 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 Original Capital Securities being tendered for exchange.
However, the Exchange Offer is subject to certain events and conditions which
may be waived by the Corporation or the Trust and to the terms and provisions of
the Registration Rights Agreement. Original Capital Securities may be tendered
in whole or in part having an aggregate Liquidation Amount of not less than
$100,000 (100 Capital Securities) or any integral multiple of $1,000 Liquidation
Amount (one Capital Security) in excess thereof. The Corporation has agreed to
pay all expenses of the Exchange Offer. See "The Exchange Offer--Fees and
Expenses." Holders of the Original Capital Securities whose Original Capital
Securities are accepted for exchange on or prior to October 15, 1997 will not
receive Distributions on such Original Capital Securities and will be deemed to
have waived the right to receive any Distributions on such Original Capital
Securities accumulated from and including May 1, 1997. See "The Exchange
Offer--Distributions on the Exchange Capital Securities."
Neither the Corporation nor the Trust will receive any cash proceeds
from the issuance of the Exchange Capital Securities offered hereby. No
dealer-manager is being used in connection with this Exchange Offer. See "Use of
Proceeds" and "Plan of Distribution."
8
<PAGE>
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Exchange Act and, in accordance therewith, files reports, proxy statements and
other information with the Commission. Such reports, proxy statements and other
information may be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549 and at the Commission's regional offices at 7 World Trade Center,
13th Floor, Suite 1300, New York, New York 10048 and Suite 1400, Citicorp
Center, 500 West Madison Street, Chicago, Illinois 60661. Copies of such
material may also be obtained by mail from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates. If available, such information also may be accessed through the
Commission's electronic data gathering, analysis and retrieval system ("EDGAR")
via electronic means, including the Commission's home page on the Internet
(http://www.sec.gov). The Corporation's common stock is traded on the Nasdaq
National Market. Such reports, proxy statements and other information concerning
the Corporation also may be inspected at the offices of the National Association
of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
No separate financial statements of the Trust have been included
herein. The Corporation and the Trust do not consider that such financial
statements would be material to holders of the Exchange Capital Securities
because the Trust is a newly-formed special purpose entity, has no operating
history or independent operations and is not engaged in and does not propose to
engage in any activity other than holding as trust assets the Junior
Subordinated Debentures, issuing the Trust Securities and engaging in activities
necessary, advisable or incidental thereto. See "Banknorth Capital Trust I,"
"Description of Exchange Securities-Description of Exchange Capital Securities,"
"Description of Exchange Securities--Description of Exchange Junior Subordinated
Debentures" and "Description of Exchange Securities--Description of Exchange
Guarantee." In addition, the Corporation does not expect that the Trust will
file reports, proxy statements and other information under the Exchange Act with
the Commission.
This Prospectus constitutes a part of a registration statement on Form
S-4 (the "Registration Statement") filed by the Corporation and the 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 and to the exhibits
relating thereto for further information with respect to the Corporation and the
Exchange 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.
9
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission
are incorporated into this Prospectus by reference:
1. The Corporation's Annual Report on Form 10-K, as amended by
Form 10-K/A, for the year ended December 31, 1996;
2. The Corporation's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1997 and June 30, 1997; and
3. The Corporation's Current Report on Form 8-K filed on April
14, 1997.
All documents subsequently filed by the Corporation pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
the termination of the offering of the Exchange Securities offered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
of this Prospectus from the date of filing of such documents. Any statement
contained herein or in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this
Prospectus, including the documents incorporated or deemed to be incorporated
herein by reference, as the same may be amended, supplemented or otherwise
modified from time to time. Statements contained in this Prospectus as to the
contents of any contract or other document referred to herein do not purport to
be complete and, where reference is made to the particular provisions of such
contract or other document, such provisions are qualified in all respects by
reference to all of the provisions of such contract or other document.
This Prospectus incorporates documents by reference that are not
presented herein or delivered herewith. The Corporation will provide without
charge to any person to whom this Prospectus is delivered, on the written or
oral request of such person, a copy of any or all of the foregoing documents
incorporated by reference herein (other than exhibits, unless such exhibits are
specifically incorporated by reference in such documents). Requests for such
documents should be directed to: Banknorth Group, Inc., 300 Financial Plaza,
P.O. Box 5420, Burlington, Vermont 05401, Attention: Neal E. Robinson (telephone
(802) 658-2492).
10
<PAGE>
SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus. Reference is made to and
this summary is qualified in its entirety by, the more detailed information and
financial statements including the notes thereto contained elsewhere in this
Prospectus and in documents incorporated by reference hereto.
Banknorth Group, Inc.
The Corporation is a multi-bank holding company organized as a Delaware
corporation in 1989 as the result of the merger of two Vermont-based bank
holding companies. The Corporation is the sole owner of five Vermont banks;
namely, First Vermont Bank and Trust Company, Franklin Lamoille Bank, The Howard
Bank, N.A., Granite Savings Bank and Trust Company and Woodstock National Bank;
one Vermont limited charter bank, The Stratevest Group, N.A., a consolidated
trust subsidiary; one New Hampshire holding company; namely, North American Bank
Corporation and its sole subsidiary, Farmington National Bank; and one
Massachusetts bank; First Massachusetts Bank, N.A. The Corporation is also the
sole owner of North Group Realty, Inc., which owns real estate utilized in the
operation of the Corporation.
Acquisitions have been, and continue to be, an important part of the
expansion of the Corporation's business. On February 16, 1996, the Corporation
completed the purchase of thirteen banking offices from Shawmut Bank, N.A. A new
subsidiary, First Massachusetts Bank, N.A., with principal offices in Worcester,
Massachusetts, was organized to own and operate the acquired offices. In
addition, on October 14, 1994, the Corporation acquired North American Bank
Corporation and its sole subsidiary, Farmington National Bank. The acquisition,
which was accounted for as a purchase, was the first for the Corporation in the
state of New Hampshire.
The Corporation engages in discussions concerning potential
acquisitions from time to time, but currently has no commitments, agreements or
understandings to acquire any additional financial institutions. The Corporation
expects to continue to take advantage of the consolidation of the financial
services industry by further developing its community bank franchise within its
own and contiguous market areas.
The Corporation's banking subsidiaries (the "Banks") offer a full range
of loan, deposit, investment products and trust services designed to meet the
financial needs of individual consumers, businesses and municipalities. Mortgage
banking services are also offered through Banknorth Mortgage Company, a
wholly-owned subsidiary of First Vermont Bank and Trust Company. These services
are currently offered throughout the states of Vermont, Massachusetts and New
Hampshire through a network of 58 banking offices.
The Corporation's network of community Banks is committed to providing
superior, efficient and personalized service to customers in chosen market
areas. To that end, operating efficiencies are achieved through the
centralization of all major support functions at the parent company level. The
Corporation's community banking management structure allows each Bank's local
management team and board of directors to focus on such Bank's customers and to
set its own loan and deposit prices in light of local competition and other
market factors.
11
<PAGE>
The Corporation believes that local business and community focus, knowledge
of customers and their needs, the provision of a broad array of financial
services and products, together with decentralized decision making at the branch
and community level, enables the Corporation to effectively compete in its
chosen markets.
Based on total assets as of December 31, 1996, the Corporation is the
largest bank holding company headquartered in Vermont. At December 31, 1996, the
Corporation had total assets, deposits and shareholders' equity of $2.6 billion,
$2.1 billion and $206.7 million, respectively. In December 1996, the Corporation
and its subsidiaries employed 1,108 on a full-time equivalent basis.
The principal executive office of the Corporation is located at 300
Financial Plaza, Burlington, Vermont 05401, and its telephone number is (802)
658-9959.
Banknorth Capital Trust I
The Trust is a statutory business trust formed under Delaware law pursuant
to (i) the Trust Agreement and (ii) the filing of a certificate of trust with
the Delaware Secretary of State on April 9, 1997. The Trust's business and
affairs are conducted by the Issuer Trustees: the Property Trustee, the Delaware
Trustee, and the three individual Administrative Trustees, who are officers or
other employees of the Corporation. The Trust exists for the exclusive purposes
of (i) issuing and selling the Trust Securities, (ii) using the proceeds from
the sale of the Trust Securities to acquire the Junior Subordinated Debentures
issued by the Corporation and (ii) engaging in only those other activities
necessary, advisable or incidental thereto. Accordingly, the Junior Subordinated
Debentures will be the sole assets of the Trust and payments under the Junior
Subordinated Debentures are and will be the sole revenue of the Trust. All of
the Common Securities will be owned by the Corporation. The principal executive
office of the Trust is c/o Banknorth Group, Inc., 300 Financial Plaza,
Burlington, Vermont 05401.
The Exchange Offer
The Exchange Offer......................... Up to and including $30,000,000
aggregate Liquidation Amount of
Exchange Capital Securities are
being offered in exchange for a like
aggregate Liquidation Amount of
Original Capital Securities.
Original 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
(one Capital Security) in excess
thereof. The Corporation and the
Trust are making the Exchange Offer
in order to satisfy their
obligations under the Registration
Rights Agreement relating to the
Original Capital Securities. For a
description of the procedures for
tendering Original Capital
Securities, see "The Exchange
Offer--Procedures for Tendering
Original Capital Securities."
Expiration Date............................ 5:00 p.m., New York City time, on
____, 1997 unless the Exchange Offer
is extended by the Corporation and
the
12
<PAGE>
Trust (in which case the Expiration
Date will be the latest date and
time to which the Exchange Offer is
extended). See "The Exchange
Offer--Terms of the Exchange Offer."
Conditions to
the Exchange Offer......................... The Exchange Offer is subject to
certain conditions, which may be
waived by the Corporation and the
Trust in their sole discretion. The
Exchange Offer is not conditioned
upon any minimum Liquidation Amount
of Original Capital Securities being
tendered. See "The Exchange
Offer--Conditions to the Exchange
Offer."
Terms of the Exchange Offer................ The Corporation and the 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 Original Capital
Securities, (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
Original Capital Securities tendered
pursuant to the Exchange Offer,
subject, however, to the right of
holders of Original Capital
Securities to withdraw their
tendered Original Capital
Securities, or (iv) to waive any
condition or otherwise amend the
terms of the Exchange Offer in any
respect. See "The Exchange
Offer--Terms of the Exchange Offer."
Withdrawal Rights.......................... Tenders of Original 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 as set forth herein under
"The Exchange Offer--Withdrawal
Rights."
Procedures for Tendering
Original Capital Securities................ Certain brokers, dealers, commercial
banks, trust companies and other
nominees who hold Original Capital
Securities through The Depository
Trust Company ("DTC") must effect
tenders by book entry transfer
through DTC's Automated Tender Offer
Program ("ATOP'). Beneficial owners
of Original Capital Securities
registered in the name of a broker,
dealer, commercial bank, trust
company or other nominee are urged
to contact such person promptly if
they wish to tender Original Capital
Securities pursuant to the Exchange
Offer. Tendering holders of Original
Capital Securities that do not use
ATOP must complete and sign a Letter
of Transmittal in accordance with
the instructions contained therein
and forward the same by mail,
facsimile transmission or hand
delivery, together with any other
required documents, to the Exchange
13
<PAGE>
Agent, either with the certificates
of the Original Capital Securities
to be tendered or in compliance with
the specified procedures for
guaranteed delivery of Original
Capital Securities. Tendering
holders of Original Capital
Securities that use ATOP will, by so
doing, acknowledge that they are
bound by the terms of the Letter of
Transmittal. See "The Exchange
Offer--Procedures for Tendering
Original Capital Securities."
Letters of Transmittal and
certificates representing Original
Capital Securities should not be
sent to the Corporation or the
Trust. Such documents should only be
sent to the Exchange Agent.
Resales of Exchange
Capital Securities......................... The Corporation and the Trust are
making the Exchange Offer in
reliance on the position of the
Staff of the Commission as set forth
in certain interpretive letters
addressed to third parties in other
transactions. However, neither the
Corporation nor the Trust has sought
its own interpretive 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 it has in
such interpretive letters to third
parties. Based on these
interpretations by the Staff of the
Commission, and subject to the two
immediately following sentences, the
Corporation and the Trust believe
that Exchange Capital Securities
issued pursuant to this Exchange
Offer in exchange for Original
Capital Securities may be offered
for resale, resold and otherwise
transferred by a holder thereof
(other than a holder who is a
broker-dealer) without further
compliance with the registration and
prospectus delivery requirements of
the Securities Act, provided that
such Exchange Capital Securities are
acquired in the ordinary course of
such holder's business and that such
holder is not participating, and has
no arrangement or understanding with
any person to participate, in a
distribution (within the meaning of
the Securities Act) of such Exchange
Capital Securities. However, any
holder of Original Capital
Securities who is an "affiliate" of
the Corporation or the Trust or who
intends to participate in the
Exchange Offer for the purpose of
distributing the Exchange Capital
Securities, or any broker-dealer who
purchased the Original Capital
Securities from the Trust for resale
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 of the Commission set
forth in the above-mentioned
interpretive
14
<PAGE>
letters, (ii) will not be permitted
or entitled to tender such Original
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 Original Capital
Securities unless such sale is made
pursuant to an exemption from such
requirements. In addition, as
described herein, if any
broker-dealer holds Original Capital
Securities acquired for its own
account as a result of market-making
or other trading activities and
exchanges such Original Capital
Securities for Exchange Capital
Securities, then such broker-dealer
must deliver a prospectus meeting
the requirements of the Securities
Act in connection with any resales
of such Exchange Capital Securities.
Each holder of Original Capital
Securities who wishes to exchange
Original Capital Securities for
Exchange Capital Securities in the
Exchange Offer will be required to
represent that (i) it is not an
"affiliate" of the Corporation or
the Trust, (ii) any Exchange Capital
Securities to be received by it are
being acquired in the ordinary
course of its business, (iii) it has
no arrangement or understanding with
any person to participate in a
distribution (within the meaning of
the Securities Act) of such Exchange
Capital Securities, and (iv) if such
holder is not a broker-dealer, such
holder is not engaged in, and does
not intend to engage in, a
distribution (within the meaning of
the Securities Act) of such Exchange
Capital Securities. Each
broker-dealer that receives Exchange
Capital Securities for its own
account in exchange for Original
Capital Securities, where such
Original 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 meeting the requirements
of the Exchange Act in connection
with any resale of such Exchange
Capital Securities. See "Plan of
Distribution." 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 of the
Commission in the interpretive
letters referred to above, the
Corporation and the Trust believe
that Participating Broker-Dealers
who acquired Original 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
Exchange Capital Securities received
upon exchange of such Original
Capital Securities
15
<PAGE>
(other than Original Capital
Securities that represent an unsold
allotment from the initial sale of
the Original 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 Exchange 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 Exchange Capital
Securities received in exchange for
Original Capital Securities where
such Original 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 herein
under "The Exchange Offer-Resales of
Exchange Capital Securities," the
Corporation and the Trust have
agreed that 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 such
Exchange Capital Securities for a
period ending 90 days after the
Expiration Date (subject to
extension under certain limited
circumstances) or, if earlier, when
all such Exchange Capital Securities
have been disposed of by such
Participating Broker-Dealer. See
"Plan of Distribution." Any
Participating Broker-Dealer who is
an "affiliate" of the Corporation or
the 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 Exchange
Capital Securities."
Exchange Agent............................. The Exchange Agent with respect to
the Exchange Offer is The First
National Bank of Chicago. The
address, and telephone and facsimile
number of the Exchange Agent are set
forth in "The Exchange
Offer--Exchange Agent" and in the
Letter of Transmittal.
Use of Proceeds............................ Neither the Corporation nor the
Trust will receive any cash proceeds
from the issuance of the Exchange
Capital Securities offered hereby.
See "Use of Proceeds."
Federal Income Tax
Considerations............................. The exchange of Original Capital
Securities for Exchange Capital
Securities should not be a taxable
exchange for federal income tax
purposes, and holders should not
recognize any
16
<PAGE>
taxable gain or loss or any interest
income as a result of such exchange.
See "Certain Federal Income Tax
Consequences--Exchange of Capital
Securities."
ERISA Considerations....................... Holders of Original Capital
Securities should review the
information set forth under "ERISA
Considerations" prior to tendering
Original Capital Securities in the
Exchange Offer.
The Exchange Capital Securities
Securities Offered......................... Up to and including $30,000,000
aggregate Liquidation Amount of
Exchange Capital Securities
(Liquidation Amount $1,000 per
Exchange Capital Security) will have
been registered under the Securities
Act. The Exchange Capital Securities
will be issued, and the Original
Capital Securities were issued,
under the Trust Agreement. The
Exchange Capital Securities and any
Original Capital Securities that
remain outstanding after
consummation of 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. See
"Description of Exchange
Securities--Description of Exchange
Capital Securities--Voting Rights;
Amendment of the Trust Agreement."
The terms of the Exchange Capital
Securities are identical in all
material respects to the terms of
the Original Capital Securities,
except that the Exchange Capital
Securities have been registered
under the Securities Act, will not
be subject to certain restrictions
on transfer applicable to the
Original Capital Securities and will
not provide for any increase in the
Distribution rate thereon. See "The
Exchange Offer--Purpose and Effect
of the Exchange Offer," "Description
of Exchange Securities" and
"Description of Original
Securities."
Distribution Dates......................... May 1 and November 1 of each year,
commencing November 1, 1997, (to the
extent that the Original Capital
Securities are accepted for exchange
on or prior to October 15, 1997) or
May 1, 1998 (to the extent that the
Original Capital Securities are
accepted for exchange after October
15, 1997).
Extension Periods.......................... So long as no Debenture Event of
Default has occurred and is
continuing, Distributions on
Exchange Capital Securities will be
deferred for the duration of any
Extension Period elected by the
Corporation with respect to the
payment of interest on the Exchange
Junior Subordinated Debentures. No
Extension Period will exceed 10
consecutive semi-annual periods, end
on a date other than an Interest
Payment Date or extend beyond the
Stated Maturity Date. During an
Extension Period, the
17
<PAGE>
holders of Exchange Capital
Securities will be required to
include deferred interest income in
their gross income for United States
federal income tax purposes in
advance of any corresponding cash
distributions. See "Description of
Exchange Securities--Description of
Exchange Junior Subordinated
Debentures--Option to Extend
Interest Payment Date" and "Certain
Federal Income Tax
Consequences--Interest Income and
Original Issue Discount."
Ranking.................................... The Exchange Capital Securities will
rank pari passu, and payments
thereon will be made pro rata, with
the Original Capital Securities and
the Common Securities except as
described under "Description of
Exchange Securities--Description of
Exchange Capital
Securities--Subordination of Common
Securities." The Exchange Junior
Subordinated Debentures will rank
pari passu with the Original Junior
Subordinated Debentures and all
other junior subordinated debentures
(if any) issued by the Corporation
(the "Other Debentures"), which are
issued and sold (if at all) to other
trusts to be established by the
Corporation (if any), in each case
similar to the Trust ("Other
Trusts"), and will constitute
unsecured obligations of the
Corporation and will rank
subordinate and junior in right of
payment to all Senior Indebtedness
to the extent and in the manner set
forth in the Indenture. See
"Description of Exchange
Securities--Description of Exchange
Junior Subordinated Debentures." The
Exchange Guarantee will rank pari
passu with the Original Guarantee
and all other guarantees (if any)
issued by the Corporation with
respect to preferred beneficial
interests (if any) issued by Other
Trusts ("Other Guarantees") and will
constitute an unsecured obligation
of the Corporation and will rank
subordinate and junior in right of
payment to all Senior Indebtedness
to the extent and in the manner set
forth in the Exchange Guarantee. See
"Description of Exchange
Securities--Description of Exchange
Guarantee" In addition, because the
Corporation is a holding company,
the Exchange Junior Subordinated
Debentures and the Exchange
Guarantee will be effectively
subordinated to all existing and
future liabilities of the
Corporation's subsidiaries. See
"Description of Exchange Securities
- Description of Exchange Junior
Subordinated Debentures -
Subordination."
Redemption................................. The Trust Securities will be subject
to mandatory redemption in a Like
Amount, (i) in whole but not in
part, on the Stated Maturity Date
upon repayment of the Junior
Subordinated
18
<PAGE>
Debentures, (ii) in whole but not in
part, at any time prior to the
Initial Optional Redemption Date,
contemporaneously with the optional
prepayment of the Junior
Subordinated Debentures by the
Corporation upon the occurrence and
continuation of a Special Event and
(iii) in whole or in part, on or
after the Initial Optional
Redemption Date, contemporaneously
with the optional prepayment by the
Corporation of all or part of the
Junior Subordinated Debentures, in
each case, at the applicable
Redemption Price. See "Description
of Exchange Securities--Description
of Exchange Capital
Securities--Redemption" and
"--Description of Exchange Junior
Subordinated Debentures--Special
Event Prepayment."
Ratings .................................. The Exchange Capital Securities are
expected to be rated BB by Duff &
Phelps Credit Rating Co. 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 Exchange 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). See
"Description of Exchange
Securities--Description of Exchange
Capital Securities--Restrictions on
Transfer." Any such transfer of
Exchange 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.
ERISA Considerations....................... Prospective purchasers must
carefully consider the restrictions
on purchase set forth under "ERISA
Considerations."
Absence of Market for the
Exchange Capital Securities................ The Exchange Capital Securities will
be a new issue of securities for
which there currently is no market.
Accordingly, there can be no
assurance as to the development or
liquidity of any market for the
Exchange Capital Securities. The
Trust and the Corporation do not
intend to apply for listing of the
Exchange Capital Securities on any
securities exchange or for quotation
through Nasdaq. See "Plan of
Distribution."
Risk Factors
Prospective investors should carefully consider the matters set forth
under "Risk Factors".
19
<PAGE>
RISK FACTORS
Prospective investors should carefully review the information contained
elsewhere in this Prospectus and should particularly consider the following
matters. In addition, information contained in, or incorporated by reference in,
this Prospectus contains "forward-looking statements" which can be identified by
the use of forward-looking terminology such as "believes," "expects," "may,"
"will," "should," "projected," "contemplates" or "anticipates" or the negative
thereof or other variations thereon or comparable terminology. No assurance can
be given that the future results covered by the forward-looking statements will
be achieved. The following matters constitute cautionary statements identifying
important factors with respect to such forward-looking statements, including
certain risks and uncertainties, that could cause actual results to vary
materially from the future results covered in such forward-looking statements.
Other factors, such as the general state of the economy, could also cause actual
results to vary materially from the future results covered in such
forward-looking statements.
Ranking of Subordinated Obligations Under the Exchange Guarantee and the
Exchange Junior Subordinated Debentures; Limitations on Source of Funds
The obligations of the Corporation under the Exchange Guarantee issued
by it for the benefit of the holders of Exchange Capital Securities, as well as
under the Exchange Junior Subordinated Debentures, will be unsecured and will
rank subordinate and junior in right of payment to all Senior Indebtedness to
the extent and in the manner set forth in the Exchange Guarantee and the
Indenture, respectively. No payment may be made of the principal of or premium,
if any, or interest on the Junior Subordinated Debentures, or in respect of any
redemption, retirement, purchase or other acquisition of any of the Junior
Subordinated Debentures, (i) when there shall have occurred and be continuing a
default in any payment in respect of any Senior Indebtedness, or there has been
an acceleration of the maturity thereof because of a default thereunder, or (ii)
in the event of the acceleration of the maturity of the Junior Subordinated
Debentures, until payment has been made on all Senior Indebtedness. At December
31, 1996, the Corporation had approximately $13.0 million of Senior Indebtedness
outstanding.
Because the Corporation is a holding company, the Corporation's
operations are conducted by its subsidiaries, including the Banks, which are
subject to significant federal and state regulation. As a result, the
Corporation's ability to receive dividends and loans from its subsidiaries is
restricted. As of December 31, 1996, the Banks were able to declare dividends to
the Corporation in 1997, without regulatory approval, of approximately $4.7
million. In addition, in February 1996, as part of its plan to capitalize the
Corporation's newly formed subsidiary bank, First Massachusetts Bank, N.A., at a
"well-capitalized" level for regulatory capital purposes, the Corporation
redeployed accumulated capital of $45.6 million in the form of special dividends
from certain of the Banks. Because the amounts of the special dividends exceeded
applicable regulatory limitations, the Corporation obtained the necessary
regulatory approvals to effect such redeployment. Payment of the special
dividends has significantly restricted the dividend paying capacity of the
Banks. Accordingly, payment of any dividends to the Corporation by certain of
the Banks currently requires regulatory approval on account of the
aforementioned special dividends, and payments of dividends by the Banks in the
future will require their generation of sufficient future earnings. Further, the
right of the Corporation
20
<PAGE>
to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability of
holders of the Exchange Capital Securities to benefit indirectly from such
distribution) is subject to the prior claims of creditors of such subsidiary
(including depositors in the case of the Banks), except to the extent that the
Corporation may itself be recognized as a creditor of that subsidiary.
Accordingly, the Exchange Junior Subordinated Debentures effectively will be
subordinated to all existing and future liabilities of the Corporation's
subsidiaries (including deposit liabilities of the Banks), and holders of
Exchange Junior Subordinated Debentures should look only to the assets of the
Corporation for payments on the Exchange Junior Subordinated Debentures. At
December 31, 1996, the subsidiaries of the Corporation had total liabilities
(excluding liabilities owed to the Corporation) of approximately $2.4 billion.
The Exchange Guarantee will constitute an unsecured obligation of the
Corporation and will rank subordinate and junior in right of payment to all
Senior Indebtedness to the same extent and in the same manner as the Exchange
Junior Subordinated Debentures. None of the Indenture, the Exchange 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 Corporation or
any of its subsidiaries. See "Description of Exchange Junior Subordinated
Debentures--General," "--Subordination" and "Description of Exchange
Guarantee--Status of the Exchange Guarantee." The Corporation expects from time
to time that it will incur additional indebtedness constituting Senior
Indebtedness and that its subsidiaries will incur additional liabilities.
The ability of the Trust to pay amounts due on the Exchange Capital
Securities is solely dependent upon the Corporation making payments on the
Exchange Junior Subordinated Debentures as and when required.
Option to Extend Interest Payment Period; Tax Consequences; Market Price
Consequences
So long as no Debenture Event of Default shall have occurred and be
continuing, the Corporation will have the right under the Indenture to defer
payments of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that an Extension Period must end on
an Interest Payment Date and may not extend beyond the Stated Maturity Date. As
a consequence of any such deferral, semi-annual Distributions on the Trust
Securities will be deferred from the relevant Distribution Date for such
Distributions during any such Extension Period (and the amount of Distributions
to which holders of the Trust Securities are entitled will accumulate additional
Distributions thereon at the rate of 10.52% per annum, compounded semi-annually,
but not exceeding the interest rate then accruing on the Junior Subordinated
Debentures). During an Extension Period, the Corporation generally will be
prohibited from (i) declaring or paying dividends on the Corporation's capital
stock, (ii) making payments of principal of or interest or premium, if any, on
its debt securities other than debt securities ranking senior to the Junior
Subordinated Debentures or (iii) making any guarantee payments with respect to
any guarantee by the Corporation of debt securities of any subsidiary of the
Corporation other than guarantees ranking senior to the Junior Subordinated
Debentures. See "Description of Exchange Securities--Description of Exchange
Capital Securities--Distributions."
21
<PAGE>
Before the end of an Extension Period, the Corporation may further
extend such Extension Period, provided that such extension does not cause such
Extension Period to exceed 10 consecutive semi-annual periods, end on a date
other than an Interest Payment Date or extend beyond the Stated Maturity Date.
Upon the termination of any Extension Period and the payment of all interest
then accrued and unpaid on the Junior Subordinated Debentures (together with
interest thereon at the annual rate of 10.52%, compounded semi-annually, to the
extent permitted by applicable law), the Corporation may begin a new Extension
Period, subject to the above requirements. There is no limitation on the number
of times that the Corporation may begin an Extension Period. See "Description of
Exchange Securities--Description of Exchange Capital Securities--Distributions"
and "--Description of Exchange Junior Subordinated Debentures--Option to Extend
Interest Payment Date."
The Corporation has no plan to exercise its right to defer payments of
interest on the Junior Subordinated Debentures. However, should the Corporation
exercise its right to defer payments of interest on the Junior Subordinated
Debentures, each holder of Trust Securities will be required to accrue income
(as original issue discount ("OID")) in respect of the deferred stated interest
allocable to its Trust Securities for United States federal income tax purposes,
which will be allocated but not distributed to holders of Trust Securities. As a
result, each holder of Capital Securities will recognize income for United
States federal income tax purposes in advance of the receipt of cash and will
not receive the cash related to such income from the Trust if the holder
disposes of the Capital Securities prior to the record date for the payment of
Distributions thereafter. See "Certain Federal Income Tax Consequences--Interest
Income and Original Issue Discount" and "--Sales of Capital Securities."
If the Corporation exercises its right to defer payments of interest on
the Junior Subordinated Debentures, 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, the mere existence of the Corporation's right to defer payments of
interest on the Junior Subordinated Debentures may cause the market price of the
Capital Securities to be more volatile than the market prices of other
securities on which OID accrues that are not subject to such deferrals.
Special Event Redemption
If a Special Event occurs before May 1, 2007, the Corporation will have
the right to prepay the Junior Subordinated Debentures in whole (but not in
part) at the Special Event Prepayment Price within 90 days following the
occurrence of such Special Event and therefore cause a mandatory redemption of
the Trust Securities at the Special Event Redemption Price. The exercise of such
right is subject to the Corporation having received any required regulatory
approvals. See "Description of Exchange Securities--Description of Exchange
Capital Securities--Redemption."
Proposed Tax Legislation
The Taxpayer Relief Act of 1997, enacted on August 5, 1997, did not
contain certain provisions of President Clinton's Fiscal 1998 Budget Proposal
(the "Proposed Legislation") that would, among other things, have denied an
issuer a deduction for United States federal income tax purposes for the payment
of interest on instruments with characteristics similar to the Junior
22
<PAGE>
Subordinated Debentures. There can be no assurances, however, that the proposed
legislation, if enacted, or similar legislation enacted after the date hereof
would not adversely affect the tax treatment of the Junior Subordinated
Debentures, resulting in a Tax Event, which would permit the Corporation, upon
the receipt of any required regulatory approval, to cause a redemption of the
Trust Securities at the Special Event Redemption Price by electing to prepay the
Junior Subordinated Debentures at the Special Event Prepayment Price. See
"Description of Exchange Securities--Description of Exchange Capital
Securities--Redemption" and "--Description of Exchange Junior Subordinated
Debentures--Special Event Prepayment." See also "Certain Federal Income Tax
Consequences--Proposed Tax Legislation."
Liquidation Distribution of Exchange Junior Subordinated Debentures
The Corporation will have the right to terminate the Trust and, after
satisfaction of liabilities of creditors of the Trust as required by applicable
law, to cause the Junior Subordinated Debentures to be distributed to the
holders of the Trust Securities. Under current United States federal income tax
law, a distribution of Exchange Junior Subordinated Debentures upon the
liquidation of the Trust would not be a taxable event to holders of the Exchange
Capital Securities. Upon the occurrence of a Special Event, however, a
liquidation of the Trust in which the Exchange Capital Securities are redeemed
for cash would be a taxable event to the holders thereof. See "Certain Federal
Income Tax Considerations--Receipt of Junior Subordinated Debentures or Cash
Upon Liquidation of the Trust."
Possible Adverse Effect on Market Prices
There can be no assurance as to the market prices for Exchange Capital
Securities or the Exchange Junior Subordinated Debentures that may be
distributed in exchange for Exchange Capital Securities if a termination of the
Trust were to occur. Accordingly, the Exchange Capital Securities or the
Exchange Junior Subordinated Debentures may trade at a discount from the price
that the investor paid to purchase such securities. Because holders of Exchange
Capital Securities may receive Exchange Junior Subordinated Debentures in
liquidation of the Trust and because Distributions are otherwise limited to
interest payments on the Exchange Junior Subordinated Debentures, prospective
purchasers of Exchange Capital Securities are also making an investment decision
with regard to the Exchange Junior Subordinated Debentures and should carefully
review all the information regarding the Exchange Junior Subordinated Debentures
contained herein. See "Description of Exchange Securities--Description of
Exchange Capital Securities--Liquidation of the Trust and Distribution of
Exchange Junior Subordinated Debentures" and "--Description of Exchange Junior
Subordinated Debentures."
Rights Under the Exchange Guarantee
The Exchange Guarantee will guarantee to the holders of the Exchange
Capital Securities the following payments, to the extent not paid by or on
behalf of the Trust: (i) any accumulated and unpaid Distributions required to be
paid on the Exchange Capital Securities, to the extent that the Trust has funds
legally available therefor at such time; (ii) the applicable Redemption Price
with respect to the Exchange Capital Securities called for redemption, to the
extent that the Trust has funds legally available therefor at such time; and
(iii) upon a voluntary or involuntary termination, winding up or liquidation of
the Trust (unless the Exchange Junior Subordinated Debentures are distributed to
23
<PAGE>
holders of the Exchange 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 Trust has funds legally available therefor at
such time and (b) the amount of assets of the Trust remaining available for
distribution to holders of the Exchange Capital Securities at such time, after
the satisfaction of liabilities to creditors of the Trust as provided by
applicable law.
The holders of a majority in Liquidation Amount of the Exchange Capital
Securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Exchange Guarantee or to direct the exercise of any trust power
conferred upon the Guarantee Trustee under the Exchange Guarantee. Any holder of
the Exchange Capital Securities may institute a legal proceeding directly
against the Corporation to enforce its rights under the Exchange Guarantee
without first instituting a legal proceeding against the Trust, the Guarantee
Trustee or any other person or entity. If the Corporation defaults on its
obligation to pay amounts payable under the Exchange Junior Subordinated
Debentures, the Trust will not have sufficient funds for the payment of
Distributions or amounts payable on redemption of the Exchange Capital
Securities or otherwise, and, in such event, holders of the Exchange Capital
Securities will not be able to rely upon the Exchange 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 Corporation to
pay the principal of (or premium, if any) or interest (including Additional Sums
(as defined below) and Compounded Interest (as defined below), if any) or
Liquidated Damages, if any, on the Exchange Junior Subordinated Debentures when
such payment is due and payable, then a holder of Exchange Capital Securities
may institute a legal proceeding directly against the Corporation for
enforcement of payment to such holder of the principal of (or premium, if any)
or interest (including Additional Sums and Compounded Interest, if any) or
Liquidated Damages, if any, on such Exchange Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Exchange
Capital Securities of such holder (a "Direct Action"). Notwithstanding any
payments made to a holder of Exchange Capital Securities by the Corporation in
connection with a Direct Action, the Corporation shall remain obligated to pay
the principal of (and premium, if any) and interest (including Additional Sums
and Compounded Interest, if any) or Liquidated Damages, if any, on the Exchange
Junior Subordinated Debentures, and the rights of the Corporation shall be
subrogated to the rights of the holder of such Exchange Capital Securities with
respect to payments on the Exchange Capital Securities to the extent of any
payments made by the Corporation to such holder in any Direct Action. Except as
described herein, holders of Exchange Capital Securities will not be able to
exercise directly any other remedy available to the holders of the Exchange
Junior Subordinated Debentures or to assert directly any other rights in respect
of the Exchange Junior Subordinated Debentures. See "Description of Exchange
Securities--Description of Exchange Junior Subordinated Debentures--Enforcement
of Certain Rights by Holders of Exchange Capital Securities," "--Debenture
Events of Default" and "Description of Exchange Securities--Description of
Exchange Guarantee." The Trust Agreement provides that each holder of Exchange
Capital Securities by acceptance thereof agrees to the provisions of the
Indenture and the Exchange Guarantee. The First National Bank of Chicago will
act as Guarantee Trustee under the Exchange Guarantee and will hold the Exchange
Guarantee for the benefit of the holders of the Exchange Capital Securities. The
First National Bank of Chicago also acts as Property Trustee under the Trust
Agreement and as Debenture Trustee under the Indenture.
24
<PAGE>
Limited Voting Rights
Holders of Exchange Capital Securities generally will have voting
rights relating only to the modification of the Exchange Capital Securities and
the exercise of the Trust's rights as holder of Exchange Junior Subordinated
Debentures. Holders of Exchange Capital Securities will not be entitled to vote
to appoint, remove or replace, or to increase or decrease the number of, the
Issuer Trustees, which voting rights are vested exclusively in the holder of the
Common Securities except upon the occurrence of certain events described herein.
The Property Trustee, the Administrative Trustees and the Corporation may amend
the Trust Agreement without the consent of holders of Exchange Capital
Securities to ensure that the Trust will be classified for United States federal
income tax purposes as a grantor trust. Holders of Exchange Capital Securities
will have no voting rights with respect to any matters submitted to a vote of
the Corporation's stockholders. See "Description of Exchange
Securities--Description of Exchange Capital Securities--Voting Rights; Amendment
of the Trust Agreement" and "--Removal of Issuer Trustees."
Trading Characteristics of the Capital Securities
The Capital Securities may trade at a price that does not fully reflect the
value of accrued but unpaid interest with respect to the underlying Exchange
Junior Subordinated Debentures. A holder who uses the accrual method of
accounting for tax purposes (and a cash method holder, if the Exchange Junior
Subordinated Debentures are deemed to have been issued with OID) and who
disposes of its Exchange Capital Securities between record dates for payments of
Distributions thereon will be required to include accrued but unpaid interest on
the Exchange Junior Subordinated Debentures through the date of disposition in
income as ordinary income (i.e., interest or, possibly, OID), and to add such
amount to its adjusted tax basis in its share of the underlying Exchange Junior
Subordinated Debentures deemed disposed of. If the selling price is less than
the holder's adjusted tax basis (which will include all accrued but unpaid
interest), a holder will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes. See "Certain Federal Income Tax
Considerations--Interest Income and Original Issue Discount" and "--Sales of
Capital Securities."
Consequences of a Failure to Exchange Original Capital Securities
The Original 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.
Original Capital Securities that 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
Original Capital Securities that remain outstanding will not be entitled to any
rights to have such Original Capital Securities registered under the Securities
Act or to any similar rights under the Registration Rights Agreement (subject to
certain limited exceptions). The Corporation and the Trust do not intend to
register under the Securities Act any Original Capital Securities that remain
outstanding after consummation of the Exchange Offer (subject to such limited
exceptions, if applicable). To the extent
25
<PAGE>
that Original Capital Securities are tendered and accepted in the Exchange
Offer, a holder's ability to sell untendered Original Capital Securities could
be adversely affected.
The Exchange Capital Securities and any Original Capital Securities that
remain outstanding after consummation of 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. See "Description of
Exchange Securities--Description of Exchange Capital Securities--Voting Rights;
Amendment of the Trust
Agreement."
The Original Capital Securities provide, among other things, that, if a
registration statement relating to the Exchange Offer has not been filed with
the Securities and Exchange Commission (the "Commission") by September 27, 1997
and declared effective by the Commission by October 27, 1997, the Distribution
rate borne by the Original Capital Securities commencing on September 27, 1997
or October 27, 1997, as the case may be, will increase by 0.25% until the
Exchange Offer is consummated. Upon consummation of the Exchange Offer, holders
of Original Capital Securities will not be entitled to any increase in the
Distribution rate thereon or any further registration rights under the
Registration Rights Agreement, except under limited circumstances. See
"Description of Original Securities."
Absence of Public Market and Restrictions on Resale
The Original Capital Securities were issued to, and the Corporation
believes such securities are currently owned by, a relatively small number of
beneficial owners. The Original Capital Securities have not been registered
under the Securities Act and will be subject to restrictions on transferability
if they are not exchanged for the Exchange Capital Securities. Although the
Exchange Capital Securities may be resold or otherwise transferred by the
holders (who are not affiliates of the Corporation or the Trust) without
compliance with the registration requirements under the Securities Act, they
will constitute a new issue of securities with no established trading market.
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).
In addition, any market-making activity, should it develop, 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 Capital Securities, or as to the
liquidity of, or the trading market for, the Exchange Capital Securities. If an
active public market does not develop, the market price and liquidity of the
Exchange Capital Securities may be adversely affected.
If a public trading market develops for the Exchange Capital Securities,
future trading prices will depend on many factors, including, among other
things, prevailing interest rates, the financial condition and results of
operations of the Corporation and the market for similar securities. Depending
on these and other factors, the Exchange Capital Securities may trade at a
discount.
Notwithstanding the registration of the Exchange Capital Securities in the
Exchange Offer, holders who are "affiliates" (as defined under Rule 405 of the
Securities Act) of the Corporation or the Trust may publicly offer for sale or
resell the Exchange Capital Securities only in compliance with the provisions of
Rule 144 under the Securities Act.
26
<PAGE>
Each broker-dealer that receives Exchange Capital Securities for its own
account in exchange for Original Capital Securities, where such Original 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 Exchange Capital Securities.
See "Plan of Distribution."
Exchange Offer Procedures
Subject to conditions set forth under "The Exchange Offer--Conditions to
the Exchange Offer," issuance of the Exchange Capital Securities in exchange for
Original Capital Securities pursuant to the Exchange Offer will be made only
after a timely receipt by the Trust of a book-entry confirmation evidencing the
tender of such Original Capital Securities through ATOP or certificates
representing such Original Capital Securities, a properly completed and duly
executed Letter of Transmittal, with any required signature guarantees, and all
other required documents. See "The Exchange Offer--Acceptance for Exchange and
Issuance of Exchange Capital Securities" and "--Procedures for Tendering
Original Capital Securities." Therefore, holders of the Original Capital
Securities desiring to tender such Original Capital Securities in exchange for
Exchange Capital Securities should allow sufficient time to ensure timely
delivery. Neither the Corporation nor the Trust is under any duty to give
notification of defects or irregularities with respect to the tenders of
Original Capital Securities for exchange.
27
<PAGE>
BANKNORTH GROUP, INC.
The Corporation is a multi-bank holding company organized as a Delaware
corporation in 1989 as the result of the merger of two Vermont-based bank
holding companies. The Corporation is the sole owner of five Vermont banks,
namely, First Vermont Bank and Trust Company, Franklin Lamoille Bank, The Howard
Bank, N.A., Granite Savings Bank and Trust Company and Woodstock National Bank;
one Vermont limited charter bank, The Stratevest Group, N.A., a consolidated
trust subsidiary; one New Hampshire holding company, namely, North American Bank
Corporation and its sole subsidiary, Farmington National Bank; and one
Massachusetts bank, First Massachusetts Bank, N.A. The Corporation is also the
sole owner of North Group Realty, Inc., which owns real estate utilized in the
operation of the Corporation.
Acquisitions have been, and continue to be, an important part of the
expansion of the Corporation's business. On February 16, 1996, the Corporation
completed the purchase of thirteen banking offices from Shawmut Bank, N.A. A new
subsidiary, First Massachusetts Bank, N.A., with principal offices in Worcester,
Massachusetts, was organized to own and operate the acquired offices. In
addition, on October 14, 1994, the Corporation acquired North American Bank
Corporation and its sole subsidiary, Farmington National Bank. The acquisition,
which was accounted for as a purchase, was the first for the Corporation in the
state of New Hampshire.
The Corporation engages in discussions concerning potential acquisitions
from time to time, but currently has no material commitments, agreements or
understandings to acquire any additional financial institutions. The Corporation
expects to continue to take advantage of the consolidation of the financial
services industry by further developing its community bank franchise within its
own and contiguous market areas.
The Corporation's banking subsidiaries (the "Banks") offer a full range of
loan, deposit, investment products and trust services designed to meet the
financial needs of individual consumers, businesses and municipalities. Mortgage
banking services are also offered through Banknorth Mortgage Company, a
wholly-owned subsidiary of First Vermont Bank and Trust Company. These services
are currently offered throughout the states of Vermont, Massachusetts and New
Hampshire through a network of 58 banking offices.
The Corporation's network of community Banks is committed to providing
superior, efficient and personalized service to customers in chosen market
areas. To that end, operating efficiencies are achieved through the
centralization of all major support functions at the parent company level. The
Corporation's community banking management structure allows each Bank's local
management team and board of directors to focus on such Bank's customers and to
set its own loan and deposit prices in light of local competition and other
market factors.
The Corporation believes that local business and community focus, knowledge
of customers and their needs, the provision of a broad array of financial
services and products, together with decentralized decision making at the branch
and community level, enables the Corporation to effectively compete in its
chosen markets.
28
<PAGE>
Based on total assets as of December 31, 1996, the Corporation is the
largest bank holding company headquartered in Vermont. At December 31, 1996, the
Corporation had total assets, deposits and shareholders' equity of $2.6 billion,
$2.1 billion and $206.7 million, respectively. In December 1996, the Corporation
and its subsidiaries employed 1,108 on a full-time equivalent basis.
BANKNORTH CAPITAL TRUST I
The Trust is a statutory business trust formed under Delaware law upon the
filing of a certificate of trust with the Delaware Secretary of State. The Trust
exists for the exclusive purposes of (i) issuing and selling the Trust
Securities, (ii) using the proceeds from the sale of Trust Securities to acquire
the Junior Subordinated Debentures and (iii) engaging in only those other
activities necessary, advisable or incidental thereto. The Junior Subordinated
Debentures are and will be the sole assets of the Trust, and payments under the
Junior Subordinated Debentures will be the sole revenues of the Trust. All of
the Common Securities are owned by the Corporation. The Common Securities rank
pari passu, and payments will be made thereon pro rata, with the Capital
Securities, except that if there is an event of default under the Trust
Agreement resulting from a Debenture Event of Default, the rights of the
Corporation as holder of the Common Securities to payments in respect of
Distributions and payments upon liquidation, redemption or otherwise will be
subordinated to the rights of the holders of the Capital Securities. See
"Description of Exchange Capital Securities--Subordination of Common
Securities." The Corporation acquired Common Securities in an aggregate
Liquidation Amount equal to at least 3% of the total capital of the Trust. The
Trust has a term of approximately 31 years, but may be terminated earlier as
provided in the Trust Agreement. The Trust's business and affairs are conducted
by the Issuer Trustees, each appointed by the Corporation as holder of the
Common Securities. The Issuer Trustees for the Trust are The First National Bank
of Chicago, as the Property Trustee, First Chicago Delaware, Inc., as the
Delaware Trustee and the three Administrative Trustees who are officers or other
employees of the Corporation. The First National Bank of Chicago also acts as
guarantee trustee under the Guarantee and as debenture trustee under the
Indenture. See "Description of Exchange Securities--Description of Exchange
Guarantee" and "--Description of Exchange Junior Subordinated Debentures." The
holder of the Common Securities or, if an Event of Default under the Trust
Agreement has occurred and is continuing, the holders of a majority in
Liquidation Amount of the Capital Securities are entitled to appoint, remove or
replace the Property Trustee and/or the Delaware Trustee. In no event will the
holders of the Exchange Capital Securities have the right to vote to appoint,
remove or replace the Administrative Trustees; such voting rights will be vested
exclusively in the holder of the Common Securities. The duties and obligations
of each Issuer Trustee are governed by the Trust Agreement. The Corporation, as
issuer of the Junior Subordinated Debentures, has agreed to pay all fees,
expenses, debts and obligations (other than the payment of principal of, and
premium, if any, and interest on, the Trust Securities) related to the Trust and
the offering of the Capital Securities and has agreed to pay, directly or
indirectly, all ongoing costs, expenses and liabilities (other than the payment
of principal of, and premium, if any, and interest on, the Trust Securities) of
the Trust.
29
<PAGE>
USE OF PROCEEDS
Neither the Corporation nor the Trust will receive any cash proceeds from
the issuance of the Exchange Capital Securities. In consideration for issuing
the Exchange Capital Securities in exchange for Original Capital Securities as
described in this Prospectus, the Trust will receive Original Capital Securities
in like Liquidation Amount. The Original Capital Securities surrendered in
exchange for the Exchange Capital Securities will be retired and canceled.
The proceeds to the Trust (without giving effect to expenses of the
offering payable by the Corporation) from the offering of the Original Capital
Securities was $30,000,000. All of the proceeds from the sale of the Original
Capital Securities were invested by the Trust in the Original Junior
Subordinated Debentures. The Corporation intends that the net proceeds from the
sale of the Original Junior Subordinated Debentures will be used for general
corporate purposes.
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
The following table sets forth the ratios of earnings to combined fixed
charges of the Corporation on a consolidated basis for the respective periods
indicated.
<TABLE>
<CAPTION>
Six
Months
Ended
June 30, Year Ended December 31,
---------- ----------------------------------------------------------
1997 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined Fixed Charges:
Excluding interest on deposits ..................... 3.09x 4.35x 3.00x 2.78x 3.38x 1.75x
Including interest on deposits ..................... 1.44 1.46 1.45 1.43 1.37 1.04
</TABLE>
For purposes of computing the ratios of earnings to combined fixed charges,
earnings represent net income (loss) before extraordinary items and cumulative
effect of changes in accounting principles plus applicable income taxes and
fixed charges. Fixed charges, excluding interest on deposits, include gross
interest expense (other than on deposits) and the proportion deemed
representative of the interest factor of rent expense, net of income from
subleases. Fixed charges, including gross interest on deposits, include all
interest expense and the proportion deemed representative of the interest factor
of rent expense, net of income from subleases.
30
<PAGE>
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust is treated as a subsidiary of
the Corporation and, accordingly, the accounts of the Trust are included in the
consolidated financial statements of the Corporation. The Capital Securities are
shown in the consolidated balance sheets of the Corporation as
"Corporation-Obligated Mandatorily Redeemable Capital Securities of Subsidiary
Trust Holding Solely Junior Subordinated Debentures of the Corporation."
31
<PAGE>
CAPITALIZATION
The following table sets forth the unaudited consolidated capitalization of
the Corporation as of June 30, 1997, and such capitalization as adjusted to give
effect to the consummation of the offering of the Original Securities. The
following data should be read in conjunction with the financial information and
discussion thereof included in documents incorporated by reference in this
Prospectus. See "Incorporation of Certain Documents by Reference."
<TABLE>
<CAPTION>
June 30, 1997
---------------------
Actual
---------
(in thousands)
(unaudited)
<S> <C>
Long-Term Borrowings:
Federal Home Loan Bank Term Notes ..................... $ 9,722
Bank term loan ........................................ 11,700
---------
Total Long-Term Borrowings ..................... 21,422
---------
Corporation-Obligated Mandatorily Redeemable Capital
Securities of Subsidiary Trust Holding Solely Junior
Subordinated Debentures of the Corporation (1) .......... 30,000
---------
Shareholders' equity:
Common stock, par value $1.00 per share, 20,000,000
shares authorized, 7,826,648 issued and outstanding 7,827
Surplus ............................................... 87,566
Retained earnings ..................................... 124,532
Unamortized employee restricted stock ................. (1,047)
Net unrealized losses on securities available for sale,
net of tax ......................................... (2,012)
---------
Total Shareholders' Equity ..................... 216,866
---------
Total Capitalization .................. $ 268,288
=========
</TABLE>
- ----------
(1) Reflects the Original Securities. As described herein, the sole assets of
the Trust, which is a subsidiary of the Corporation, are $30,928,000
aggregate principal amount of the Junior Subordinated Debentures (including
the amounts attributable to the issuance of the Common Securities of the
Trust), which will mature on May 1, 2027. The Corporation owns all of the
Common Securities issued by the Trust.
32
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The selected consolidated financial data below should be read in connection
with the financial information included in the Corporation's 1996 Annual Report
on Form 10-K for the year ended December 31, 1996 and its Quarterly Report on
Form 10-Q for the quarter ended June 30, 1997. See "Available Information" and
"Incorporation of Certain Documents by Reference." Results for the six months
ended June 30, 1997 are not necessarily indicative of results that may be
expected for any other interim period or for the year as a whole.
<TABLE>
<CAPTION>
================================================================================
Six Months Ended June 30, Years Ended December 31,
--------------------------------------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
------------ --------- --------- ---------- --------- --------- ----------
(In thousands, except for share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Statement of Income Data:
Interest income................... 105,294 90,587 $190,008 $152,624 $124,403 $113,178 $123,671
Interest expense.................. 46,882 38,575 81,140 67,980 49,599 44,670 58,575
------------ --------- --------- ---------- --------- --------- ----------
Net interest income............... 58,412 52,012 108,868 84,644 74,804 68,508 65,096
Provision for loan losses......... 3,686 2,600 5,600 4,375 3,210 4,700 13,333
------------ --------- --------- ---------- --------- --------- ----------
Net interest income after
provision for loan losses....... 54,726 49,412 103,268 80,269 71,594 63,808 51,763
Other income...................... 13,201 12,342 25,303 20,910 19,971 24,757 23,687
Other expenses.................... 47,015 44,663 91,200 70,589 69,928 71,869 73,116
------------ --------- --------- ---------- --------- --------- ----------
Income before income taxes........ 20,912 17,091 37,371 30,590 21,637 16,696 2,334
Income tax expense................ 6,773 5,547 11,981 8,217 5,734 5,235 163
------------ --------- --------- ---------- --------- --------- ----------
Income before cumulative effect of
accounting changes................ 14,139 11,544 25,390 22,373 15,903 11,461 2,171
Cumulative effect of accounting
changes........................... 0 0 0 0 138 (3,500) 0
------------ --------- --------- ---------- --------- --------- ----------
Net income........................ $14,139 $11,544 $25,390 $22,373 $16,041 $7,961 $2,171
============ ========= ========= ========== ========= ========= ==========
Share Data:
Shares outstanding, period end.... 7,826,648 7,826,648 7,826,648 6,804,425 6,804,425 6,804,425 6,804,425
Weighted average shares outstanding 7,826,648 7,579,517 7,703,758 6,804,425 6,804,425 6,804,425 6,804,425
Tangible book value, period end... $23.42 $19.89 $21.80 $22.25 $18.54 $19.40 $18.71
Cash dividends declared........... .58 .50 1.00 0.92 0.60 0.40 0
Income before cumulative effect of
accounting changes.............. 1.81 1.52 3.30 3.29 2.34 1.68 0.32
Net income........................ 1.81 1.52 3.30 3.29 2.36 1.17 0.32
Average Balance Sheet Data:
Loans............................. $1,889,495 1,642,670 $1,730,720 $1,329,188 $1,187,773 $1,091,851 $1,125,675
Loans charged off, net of recoveries 3,243 1,676 5,825 3,717 4,744 5,436 13,330
Non-performing assets,period end.. 16,302 23,248 19,889 15,140 19,964 32,460 50,847
Total earning assets.............. 2,530,128 2,147,379 2,252,385 1,781,836 1,621,251 1,486,899 1,474,584
Total assets...................... 2,680,834 2,294,483 2,405,407 1,875,400 1,713,814 1,594,188 1,591,908
Total deposits.................... 2,072,532 1,913,164 1,989,006 1,453,878 1,306,749 1,278,284 1,374,017
Short-term borrowings............. 341,640 126,567 159,672 164,010 145,616 130,176 57,875
Long-term debt.................... 23,740 49,861 43,951 94,107 113,364 41,312 14,834
Shareholders' equity.............. 209,303 183,621 191,279 145,950 131,008 128,309 124,996
Ratios:
Return on average assets
before cumulative effect of
accounting changes................ 1.06% 1.01% 1.06% 1.19% 0.93% 0.72% 0.14%
Net income........................ 1.06 1.01 1.06 1.19 0.94 0.50 0.14
Return on average shareholders'
equity before cumulative effect of
accounting changes ............. 13.62 12.64 13.27 15.33 12.14 8.93 1.74
Return on average shareholders'
equity............................ 13.62 12.64 13.27 15.33 12.24 6.20 1.74
Net interest margin............... 4.68 4.90 4.86 4.79 4.65 4.65 4.47
Efficiency ratio.................. 61.40 62.38 62.11 65.11 69.76 72.88 75.37
Expense ratio..................... 2.47 2.62 2.59 2.70 2.84 2.96 2.98
As a percent of risk-adjusted assets:
Total capital..................... 11.72 10.37 10.35 12.48 11.86 12.95 12.71
Tier 1 capital.................... 10.55 9.12 9.11 11.22 10.61 11.70 11.45
As a percent of total assets:
Tier 1 capital (regulatory leverage) 7.94 6.72 6.91 8.05 7.41 7.96 8.19
Tangible shareholders' equity, period 6.51
end, to tangible assets, period end 6.44 6.65 7.96 6.77 7.86 8.15
</TABLE>
33
<PAGE>
THE EXCHANGE OFFER
Purpose and Effect of the Exchange Offer
In connection with the sale of the Original Capital Securities, the
Corporation and the Trust entered into the Registration Rights Agreement with
the Initial Purchaser, pursuant to which the Corporation and the Trust agreed to
file and use commercially reasonable efforts to cause to become effective with
the Commission a registration statement relating to the exchange of the New
Capital Securities for the Original 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 Corporation and the Trust under the Registration Rights Agreement. The
form and terms of the Exchange Capital Securities are the same as the form and
terms of the Original Capital Securities except that the Exchange Capital
Securities have been registered under the Securities Act, will not be subject to
certain restrictions on transfer applicable to the Original Capital Securities
and will not provide for any increase in the Distribution rate thereon. In that
regard, the Original Capital Securities provide, among other things, that, if a
registration statement relating to the Exchange Offer has not been filed by
September 27, 1997 and declared effective by October 27, 1997, the Distribution
rate borne by the Original Capital Securities will increase by 0.25% per annum
until such registration statement is filed or declared effective, as the case
may be. In addition, the Original Capital Securities provide that, if the Trust
has not exchanged Exchange Capital Securities for all Original Capital
Securities validly tendered by the 45th day after the date on which the
registration statement is declared effective, the Distribution rate borne by the
Original Capital Securities will increase by 0.25% per annum for the period from
the occurrence of such event until the Exchange Offer has been consummated. Upon
consummation of the Exchange Offer, holders of Original Capital Securities will
not be entitled to any increase in the Distribution rate thereon or any further
registration rights under the Registration Rights Agreement, except under
limited circumstances. See "Risk Factors--Consequences of a Failure to Exchange
Original Capital Securities" and "Description of Original Securities."
The Exchange Offer is not being made to, nor will the Trust accept
tenders for exchange from, holders of Original 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 Original Capital
Securities are registered on the books of the Trust or any other person who has
obtained a properly completed bond power from the registered holder, or any
person whose Original Capital Securities are held of record by DTC who desires
to deliver such Original Capital Securities by book-entry transfer at DTC.
Pursuant to the Exchange Offer, as soon as practicable after the
Expiration Date, the Corporation will exchange the Exchange Junior Subordinated
Debentures for the Original Junior Subordinated Debentures in a principal
amount corresponding to the Liquidation Amount of the Original Capital
Securities accepted for exchange and will execute the Exchange Guarantee in
respect of the Exchange Capital Securities exchanged for such Original Capital
Securities. The Exchange Guarantee and the Exchange Junior Subordinated
Debentures have been registered under the Securities Act.
34
<PAGE>
Terms of the Exchange Offer
The Trust hereby offers, upon the terms and subject to the conditions
set forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to and including $30,000,000 aggregate Liquidation Amount of
Exchange Capital Securities for a like aggregate Liquidation Amount of Original
Capital Securities properly tendered on or prior to the Expiration Date and not
properly withdrawn in accordance with the procedures described herein. The Trust
will issue, as soon as practicable after the Expiration Date, an aggregate
Liquidation Amount of up to and including $30,000,000 of Exchange Capital
Securities in exchange for a like Liquidation Amount of outstanding Original
Capital Securities tendered and accepted in connection with the Exchange Offer.
Holders may tender their Original Capital Securities in whole or in part in a
Liquidation Amount of not less than $100,000 (100 Capital Securities) or any
integral multiple of $1,000 Liquidation Amount (one Capital Security) in excess
thereof.
The Exchange Offer is not conditioned upon any minimum Liquidation
Amount of Original Capital Securities being tendered. As of the date of this
Prospectus, $30,000,000 aggregate Liquidation Amount of the Original Capital
Securities is outstanding.
Holders of Original Capital Securities do not have any appraisal or
dissenters' rights in connection with the Exchange Offer. Original Capital
Securities that are not tendered for 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
Original Capital Securities" and "Description of Original Securities."
If any tendered Original 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 Original
Capital Securities will be returned, without expense, to the tendering holder
thereof as soon as practicable after the Expiration Date.
Holders who tender Original 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 Original Capital Securities in connection with the
Exchange Offer. The Corporation will pay all charges and expenses, other than
certain applicable taxes described herein, in connection with the Exchange
Offer. See "--Fees and Expenses."
NEITHER THE CORPORATION, THE BOARD OF DIRECTORS OF THE CORPORATION NOR
ANY ISSUER TRUSTEE OF THE TRUST MAKES ANY RECOMMENDATION TO HOLDERS OF ORIGINAL
CAPITAL SECURITIES AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING ALL OR ANY
PORTION OF THEIR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER. IN
ADDITION, NO ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. EACH
HOLDER OF ORIGINAL CAPITAL SECURITIES MUST DECIDE WHETHER TO TENDER PURSUANT TO
THE EXCHANGE OFFER AND, IF SO, THE LIQUIDATION AMOUNT OF ORIGINAL CAPITAL
SECURITIES TO TENDER BASED ON SUCH HOLDER'S OWN FINANCIAL POSITION AND
REQUIREMENTS.
35
<PAGE>
Expiration Date, Extensions, Amendments
The term "Expiration Date" means 5:00 p.m., New York City time, on ,
1997 unless the Exchange Offer is extended by the Corporation or the Trust (in
which case the term "Expiration Date" shall mean the latest date and time to
which the Exchange Offer is extended).
The Corporation and the 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 Original Capital Securities for
exchange, (ii) to terminate the Exchange Offer (whether or not any Original
Capital Securities have theretofore been accepted for exchange) if the Trust
determines, in its sole and absolute discretion that if 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 Original Capital Securities tendered pursuant to
the Exchange Offer, subject, however, to the right of holders of Original
Capital Securities to withdraw their tendered Original 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 Corporation and the Trust to
constitute a material change, or if the Corporation and the Trust waive a
material condition of the Exchange Offer, the Corporation and the Trust will
promptly disclose such amendment by means of a prospectus supplement that will
be distributed to the holders of the Original Capital Securities, and the
Corporation and the 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 (as defined herein) after the previously scheduled Expiration Date.
Without limiting the manner in which the Corporation and the Trust may choose to
make any public announcement and subject to applicable laws, the Corporation and
the Trust shall have no obligation to publish, advertise or otherwise
communicate any such public announcement other than by issuing a release to an
appropriate news agency.
Acceptance for Exchange and Issuance of Exchange Capital Securities
Upon the terms and subject to the conditions of the Exchange Offer, the
Trust will exchange, and will issue to the Exchange Agent, Exchange Capital
Securities for Original Capital Securities validly tendered and not withdrawn
promptly after the Expiration Date.
In all cases, delivery of Exchange Capital Securities in exchange for
Original 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) the book-entry confirmation described below under "--Procedures for
Tendering Original Capital Securities--Book-Entry Transfer" or (ii) certificates
representing such Original Capital Securities, and the Letter of Transmittal (or
facsimile thereof) properly completed and duly executed, with any required
signature guarantees, and any other documents required by the Letter of
Transmittal.
Subject to the terms and conditions of the Exchange Offer, the Trust
will be deemed to have accepted for exchange, and thereby exchanged, Original
Capital Securities validly tendered and not withdrawn as, if and when the Trust
gives oral or written notice to the Exchange Agent (any such oral notice to be
promptly confirmed in writing) of the Trust's acceptance of such Original
Capital
36
<PAGE>
Securities for exchange pursuant to the Exchange Offer. The Exchange Agent will
act as agent for the Trust for the purpose of receiving tenders of book-entry
confirmations or certificates representing Original Capital Securities, Letters
of Transmittal and related documents, and as agent for tendering holders for the
purpose of receiving book-entry confirmations or certificates representing
Original Capital Securities, Letters of Transmittal and related documents and
transmitting Exchange Capital Securities to validly tendering holders. Such
exchange will be made as soon as practicable after the Expiration Date. If for
any reason whatsoever, acceptance for exchange or the exchange of any Original
Capital Securities tendered pursuant to the Exchange Offer is delayed (whether
before or after the Trust's acceptance for exchange of Original Capital
Securities) or the Trust extends the Exchange Offer or is unable to accept for
exchange or exchange Original Capital Securities tendered pursuant to the
Exchange Offer, then, without prejudice to the Trust's rights set forth herein,
the Exchange Agent may, nevertheless, on behalf of the Trust and subject to Rule
14e-1(c) under the Exchange Act, retain tendered Original Capital Securities and
such Original Capital Securities may not be withdrawn except to the extent
tendering holders are entitled to withdrawal rights as described under
"--Withdrawal Rights."
Pursuant to the Letter of Transmittal, a holder of Original Capital
Securities will represent, warrant and agree that it has full power and
authority to tender, exchange, sell, assign and transfer Original Capital
Securities, that the Trust will acquire good, marketable and unencumbered title
to the tendered Original Capital Securities, free and clear of all liens,
restrictions, charges and encumbrances, and the Original Capital Securities
tendered for exchange are not subject to any adverse claims or proxies. The
holder also will represent, warrant and agree that it will, upon request,
execute and deliver any additional documents deemed by the Trust or the Exchange
Agent to be necessary or desirable to complete the exchange, sale, assignment,
and transfer of the Original Capital Securities tendered pursuant to the
Exchange Offer. Tendering holders of Original Capital Securities that use ATOP
will, by doing so, acknowledge that they are bound by the terms of the Letter of
Transmittal.
Procedures for Tendering Original Capital Securities
Valid Tender. Except as set forth herein, in order for Original Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees and any other required documents, must be
received by the Exchange Agent at its address set forth under "--Exchange
Agent," and (i) tendered Original Capital Securities must be received by the
Exchange Agent, or (ii) such Original Capital Securities must be tendered
pursuant to the procedures for book-entry transfer set forth herein 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 herein must be complied with.
If less than all of the Original Capital Securities are tendered, a
tendering holder should fill in the Liquidation Amount of Original Capital
Securities being tendered in the appropriate box on the Letter of Transmittal or
so indicate in an agent's message in lieu of the Letter of Transmittal. The
entire Liquidation Amount of Original Capital Securities delivered to the
Exchange Agent will be deemed to have been tendered unless otherwise indicated.
THE METHOD OF DELIVERY OF THE BOOK-ENTRY CONFIRMATIONS OR CERTIFICATES,
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
37
<PAGE>
EXCHANGE AGENT. IF DELIVERY IS 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.
Book-Entry Transfer. For purposes of the Exchange Offer, the Exchange
Agent will establish an account with respect to the Original Capital Securities
at DTC within two Business Days after the date of this Prospectus. Any tendering
financial institution that is a participant in DTC's book-entry transfer
facility system must make a book-entry delivery of the Original Capital
Securities by causing DTC to transfer such Original Capital Securities into the
Exchange Agent's account at DTC in accordance with DTC's ATOP procedures for
transfers. Such holder of Original Capital Securities using ATOP should transmit
its acceptance to DTC on or prior to the Expiration Date (or comply with the
guaranteed delivery procedures set forth below). DTC will verify such
acceptance, execute a book-entry transfer of the tendered Original Capital
Securities into the Exchange Agent's account at DTC and then send to the
Exchange Agent confirmation of such book-entry transfer, including an agent's
message confirming that DTC has received an express acknowledgment from such
holder that such holder has received and agrees to be bound by the Letter of
Transmittal and that the Trust and the Corporation may enforce the Letter of
Transmittal against such holder (a "book-entry confirmation").
A beneficial owner of Original 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 owner wishes to participate in the Exchange Offer.
Certificates. If the tender is not made through ATOP, certificates
representing Original Capital Securities, as well as the Letter of Transmittal
(or facsimile thereof), properly completed and duly executed, with any required
signature guarantees, and any other required documents required by the Letter of
Transmittal, must be received by the Exchange Agent at its address set forth
under "--Exchange Agent" on or prior to the Expiration Date in order for such
tender to be effective (or the guaranteed delivery procedure set forth herein
must be complied with).
If less than all of the Original Capital Securities are tendered, a
tendering holder should fill in the Liquidation Amount of Original Capital
Securities being tendered in the appropriate box on the Letter of Transmittal.
The entire Liquidation Amount of Original Capital Securities delivered to the
Exchange Agent will be deemed to have been tendered unless otherwise indicated.
Signature Guarantees. Certificates for the Original Capital Securities
need not be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (i) a certificate for the Original Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (ii) such 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 Original 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): (a) a bank; (b) a broker, dealer, municipal securities
broker or dealer or government securities broker or dealer; (c) a credit union;
(d) a national securities exchange, registered securities association or
clearing agency; or (e) a savings association that is a participant in a
Securities Transfer Association (each of the foregoing, an "Eligible
Institution"), unless surrendered on behalf of such Eligible Institution. See
Instruction 1 to the Letter of Transmittal.
38
<PAGE>
Delivery. The method of delivery of the book-entry confirmation or
certificates representing tendered Original 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 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.
Notwithstanding any other provision hereof, the delivery of Exchange
Capital Securities in exchange for Original 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 (i) a book-entry confirmation
with respect to such Original Capital Securities or (ii) certificates
representing Original Capital Securities and a properly completed and duly
executed Letter of Transmittal (or facsimile thereof), together with any
required signature guarantees and any other documents required by the Letter of
Transmittal. Accordingly, the delivery of Exchange 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 Original Capital Securities or
certificates representing Original Capital Securities and other required
documents are received by the Exchange Agent.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
Guaranteed Delivery. If a holder desires to tender Original Capital
Securities pursuant to the Exchange Offer and the certificates for such Original
Capital Securities are not immediately available or time will not permit all
required documents to reach the Exchange Agent on or prior to the Expiration
Date, or the procedure for book-entry transfer cannot be completed on a timely
basis, such Original 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 to the Exchange
Agent guaranteeing delivery to the Exchange Agent of either certificates
representing Original Capital Securities or a book-entry confirmation in
compliance with the requirements set forth herein (a "Notice of Guaranteed
Delivery"), substantially in the form accompanying the Letter of Transmittal, is
received by the Exchange Agent, as provided herein, on or prior to Expiration
Date; and
(iii) a book-entry confirmation or the certificates representing all
tendered Original Capital Securities, in proper form for transfer, together with
a properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees and any other documents
required by the Letter of Transmittal, are, in any case, received by the
Exchange Agent within three 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 Trust's acceptance for exchange of Original Capital Securities
tendered pursuant to any of the procedures described above will constitute a
binding agreement between the tendering holder and the Trust upon the terms and
subject to the conditions of the Exchange Offer.
39
<PAGE>
Determination of Validity. All questions as to the form of documents,
validity, eligibility (including time of receipt) and acceptance for exchange of
any tendered Original Capital Securities will be determined by the Corporation
and the Trust, in their sole discretion, whose determination shall be final and
binding on all parties. The Corporation and the 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 opinion of counsel to the Corporation and the Trust,
be unlawful. The Corporation and the Trust also reserve the absolute right,
subject to applicable law, to waive any of the conditions of the Exchange Offer
as set forth under "--Conditions to the Exchange Offer" or any condition or
irregularity in any tender of Original Capital Securities of any particular
holder, whether or not similar conditions or irregularities are waived in the
case of other holders.
The interpretation by the Corporation and the Trust 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 Original Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. None of the Corporation,
the Trust, any affiliates or assigns of the Corporation or the Trust, the
Exchange Agent or 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
Corporation and the Trust, proper evidence satisfactory to the Corporation and
the Trust, in their sole discretion, of such person's authority to so act must
be submitted.
Resales of Exchange Capital Securities
The Trust is making the Exchange Offer for the Exchange Capital
Securities in reliance on the position of the Staff of the Commission as set
forth in certain interpretive letters addressed to third parties in other
transactions. However, neither the Corporation nor the Trust sought its own
interpretive 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 it has in such interpretive letters to third parties. Based on these
interpretations by the Staff of the Commission, and subject to the two
immediately following sentences, the Corporation and the Trust believe that
Exchange Capital Securities issued pursuant to the Exchange Offer in exchange
for Original Capital Securities may be offered for resale, resold and otherwise
transferred by a holder thereof (other than a holder who is a broker-dealer)
without further compliance with the registration and prospectus delivery
requirements of the Securities Act, provided that such Exchange Capital
Securities are acquired in the ordinary course of such holder's business and
that such holder is not participating, and has no arrangement or understanding
with any person to participate, in a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. However, any holder of
Original Capital Securities who is an "affiliate" of the Corporation or the
Trust or who intends to participate in the Exchange Offer for the purpose of
distributing Exchange Capital Securities, or any broker-dealer who purchased
Original Capital Securities from the Trust for resale 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 of the Commission set forth in the
above-mentioned interpretive letters, (ii) will not be permitted or entitled to
tender such Original 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
40
<PAGE>
other transfer of such Original Capital Securities unless such sale is made
pursuant to an exemption from such requirements. In addition, as described
herein, if any broker-dealer holds Original Capital Securities acquired for its
own account as a result of market-making or other trading activities and
exchanges such New Capital Securities for Original Capital Securities, then such
broker-dealer must deliver a prospectus meeting the requirements of the
Securities Act in connection with any resales of such Exchange Capital
Securities.
Each holder of Original Capital Securities who wishes to exchange
Original Capital Securities for Exchange Capital Securities in the Exchange
Offer will be required to represent that (i) it is not an "affiliate" of the
Corporation or the Trust, (ii) any Exchange Capital Securities to be received by
it are being acquired in the ordinary course of its business, (iii) it has no
arrangement or understanding with any person to participate in a distribution
(within the meaning of the Securities Act) of such Exchange Capital Securities,
and (iv) if such holder is not a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution (within the meaning of the
Securities Act) of such Exchange Capital Securities. In addition, the
Corporation and the Trust may require such holder, as a condition to such
holder's eligibility to participate in the Exchange Offer, to furnish to the
Corporation and the 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 Original Capital
Securities to be exchanged in the Exchange Offer. Each broker-dealer that
receives Exchange Capital Securities for its own account pursuant to the
Exchange Offer must acknowledge that it acquired the Original Capital Securities
for its own account as the result of market-making activities or other trading
activities and must agree that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange 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 of the Commission in the interpretive
letters referred to above, the Corporation and the Trust believe that
Participating Broker-Dealers who acquired Original 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 Exchange
Capital Securities received upon exchange of such Original Capital Securities
(other than Original Capital Securities which represent an unsold allotment from
the initial sale of the Original 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 Exchange 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 Exchange Capital Securities received in
exchange for Original Capital Securities where such Original 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 Corporation and
the Trust have agreed that 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 such Exchange Capital Securities for a period ending 90 days
after the Expiration Date (subject to extension under certain limited
circumstances described herein) or, if earlier, when all such Exchange Capital
Securities have been disposed of by such Participating Broker-Dealer. See "Plan
of Distribution." However, a Participating Broker-Dealer who intends to use this
Prospectus in connection with the resale of Exchange Capital Securities received
in exchange for Original Capital Securities pursuant to the Exchange Offer must
notify the Corporation or the Trust, or cause the Corporation or the Trust to be
notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent at its
address set forth herein under
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"--Exchange Agent." Any Participating Broker-Dealer who is an "affiliate" of the
Corporation or the 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
Original 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 Corporation or the Trust of the occurrence of any event or the
discovery of (i) any fact that makes any statement contained or incorporated by
reference in this Prospectus untrue in any material respect or (ii) any fact
that causes this Prospectus to omit to state a material fact necessary in order
to make the statements contained or incorporated by reference herein, in the
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 Exchange
Capital Securities (or the Exchange Guarantee or the Exchange Junior
Subordinated Debentures, as applicable) pursuant to this Prospectus until the
Corporation or the 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 Corporation
or the Trust has given notice that the sale of the Exchange Capital Securities
(or the Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) may be resumed, as the case may be. If the Corporation or the Trust
gives such notice to suspend the sale of the Exchange Capital Securities (or the
Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable), it shall extend the 90-day period referred to above during which
Participating Broker-Dealers are entitled to use this Prospectus in connection
with the resale of Exchange 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
amended or supplemented Prospectus necessary to permit resales of the Exchange
Capital Securities or to and including the date on which the Corporation or the
Trust has given notice that the sale of Exchange Capital Securities (or the
Exchange Guarantee or the Exchange Junior Subordinated Debentures, as
applicable) may be resumed, as the case may be.
Withdrawal Rights
Except as otherwise provided herein, tenders of Original 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, telegraphic or
facsimile transmission of such notice of withdrawal must be timely received by
the Exchange Agent at its address set forth 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 Original Capital Securities to be withdrawn, the
aggregate Liquidation Amount of Original Capital Securities to be withdrawn, and
(if certificates for such Original Capital Securities have been tendered) the
name of the registered holder of the Original Capital Securities as set forth on
the certificates if different from that of the person who tendered such Original
Capital Securities. If certificates representing Original Capital Securities
have been delivered or otherwise identified to the Exchange Agent, then prior to
the physical release of such certificates, the tendering holder must submit the
serial numbers shown on the particular certificates to be withdrawn and the
signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Original Capital Securities tendered for the
account of an Eligible Institution. If Original Capital Securities have been
tendered pursuant to the procedures for book-entry transfer set forth in
"--Procedures for Tendering Original Capital Securities--Book-Entry Transfer,"
the notice of withdrawal must specify the name and number of the account at DTC
to be
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credited with the withdrawal of Original Capital Securities. Withdrawals of
tenders of Original Capital Securities may not be rescinded. Original 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 above under
"--Procedures for Tendering Original Capital Securities."
All questions as to the validity, form and eligibility (including time
of receipt) of such withdrawal notices will be determined by the Trust, in its
sole discretion, whose determination shall be final and binding on all parties.
None of the Corporation, the Trust, any affiliates or assigns of the Corporation
or the Trust, the Exchange Agent or 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 Original Capital
Securities that have been tendered but are withdrawn will be returned to the
holder thereof promptly after withdrawal.
Distributions on the Exchange Capital Securities
Holders of Original Capital Securities whose Original Capital
Securities are accepted for exchange on or prior to October 15, 1997 will not
receive Distributions on such Original Capital Securities and will be deemed to
have waived the right to receive any Distributions on such Original Capital
Securities accumulated from and including May 1, 1997. Accordingly, holders of
Exchange Capital Securities as of the close of business on October 15, 1997
will be entitled to receive Distributions accumulated from and including
May 1, 1997. To the extent that the Original Capital Securities are accepted for
exchange after October 15, 1997, holders of Exchange Capital Securities will be
entitled to receive Distributions accumulated from and including November 1,
1997.
Conditions to the Exchange Offer
Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, the Corporation and the Trust will not be
required to accept for exchange, or to exchange, any Original Capital Securities
for any Exchange Capital Securities, and, as described herein, may terminate the
Exchange Offer (whether or not any Original Capital Securities have theretofore
been accepted for exchange) or may waive any conditions to or amend the Exchange
Offer, if any of the following conditions have occurred or exists or have not
been satisfied:
(i) there shall occur a change in the current interpretation by the
Staff of the Commission that permits the Exchange Capital Securities issued
pursuant to the Exchange Offer in exchange for Original Capital Securities to be
offered for resale, resold and otherwise transferred by holders thereof (other
than broker-dealers and any such holder that is an "affiliate" of the
Corporation or the 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 Exchange 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 Exchange Capital Securities; or
(ii) any law, statute, rule or regulation shall have been adopted or
enacted which, in the judgment of Corporation or the Trust, would reasonably be
expected to impair its ability to proceed with the Exchange Offer; or
(iii) a stop order shall have been issued by the Commission or any
state securities authority suspending the effectiveness of the Registration
Statement, or proceedings shall have been initiated or, to the knowledge of the
Corporation or the Trust, threatened for that purpose, or any governmental
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approval has not been obtained, which approval the Corporation or the Trust
shall, in its sole discretion, deem necessary for the consummation of the
Exchange Offer as contemplated hereby; or
(iv) the Corporation shall have determined in good faith that there is
a reasonable likelihood that, or a material uncertainty exists as to whether,
consummation of the Exchange Offer would result in an adverse tax consequence to
the Trust or the Corporation.
If the Corporation or the Trust determine in its sole and absolute
discretion that any of the foregoing events or conditions has occurred or exists
or has not been satisfied, it may, subject to applicable law, terminate the
Exchange Offer (whether or not any Original 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 Corporation or the
Trust will promptly disclose such waiver or amendment by means of a prospectus
supplement that will be distributed to the registered holders of the Original
Capital Securities and will extend the Exchange Offer to the extent required by
Rule 14e-1 under the Exchange Act.
Exchange Agent
The First National Bank of Chicago has been appointed as Exchange Agent
for the Exchange Offer. Delivery of the Letters of Transmittal and any other
required documents, questions, requests for assistance, and requests for
additional copies of this Prospectus or of the Letter of Transmittal should be
directed to the Exchange Agent as follows:
By Mail:
(Registered or Certified
Mail Recommended)
The First National Bank of
Chicago
153 West 51st Street
5th Floor,
New York, New York
10019
Facsimile Transmitter:
(Eligible Institutions Only)
(212) 240-8938
To Confirm by Telephone
(212) 240-8801
By Hand or Overnight
Delivery:
The First National Bank of
Chicago
153 West 51st Street
5th Floor
New York, New York
10019
Delivery to other than the above address or facsimile number will not
constitute a valid delivery.
Fees and Expenses
The Corporation 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 Corporation 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 Original Capital Securities,
and in handling or tendering for their customers.
Holders who tender their Original Capital Securities for exchange will
not be obligated to pay any transfer taxes in connection therewith. If, however,
Exchange Capital Securities are to be
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delivered to, or are to be issued in the name of, any person other than the
registered holder of the Original Capital Securities tendered, or if a transfer
tax is imposed for any reason other than the exchange of Original 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 Corporation nor the Trust will make any payment to brokers,
dealers or others soliciting acceptances of the Exchange Offer.
The Registration Rights Agreement is governed by, and construed in
accordance with, the laws of the State of New York. The summary herein of
certain provisions of the Registration Rights Agreement does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of the Registration Rights Agreement, a form of which is
available upon request to the Corporation. See "Incorporation of Certain
Documents by Reference." In addition, the information set forth above concerning
certain interpretations of and positions taken by the Staff of the Commission is
not intended to constitute legal advice, and prospective investors should
consult their own legal advisors with respect to such matters.
DESCRIPTION OF EXCHANGE SECURITIES
Description of Exchange Capital Securities
Pursuant to the terms of the Trust Agreement, the Trust will issue the
Exchange Capital Securities. The Exchange Capital Securities will represent
beneficial interests in the Trust and the holders thereof will be entitled to a
preference over the Common Securities in certain circumstances with respect to
Distributions and amounts payable on redemption of the Trust Securities or
liquidation of the Trust. See "--Subordination of Common Securities." The Trust
Agreement has been qualified under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"). This summary of certain provisions of the Exchange
Capital Securities and the Trust Agreement does not purport to be complete and
is subject to, and is qualified in its entirety by reference to, all of the
provisions of the Trust Agreement, including the definitions therein of certain
terms.
General. The Exchange Capital Securities will be limited to $30,000,000
aggregate Liquidation Amount at any one time outstanding. The Exchange Capital
Securities will rank pari passu, and payments will be made thereon pro rata,
with the Original Capital Securities and the Common Securities except as
described under "--Subordination of Common Securities." Legal title to the
Exchange Junior Subordinated Debentures will be held by the Property Trustee on
behalf of the Trust in trust for the benefit of the holders of the Exchange
Capital Securities and the related Common Securities. The Exchange Guarantee
will not guarantee payment of Distributions or amounts payable on redemption of
the Exchange Capital Securities or liquidation of the Trust when the Trust does
not have funds legally available for such payments. See "--Description of
Exchange Guarantee."
Distributions. Distributions on the Exchange Capital Securities will be
cumulative, will accumulate from May 1, 1997 (to the extent that the Original
Capital Securities are accepted for exchange on or prior to October 15, 1997) or
November 1, 1997 (to the extent that the Original Capital Securities are
accepted for exchange after October 15, 1997) and will be payable semi-annually
in arrears on May 1 and November 1 of each year, commencing November 1, 1997 or
May 1, 1998, as the case may be, at the annual rate of 10.52% of the Liquidation
Amount to the holders of the Exchange Capital Securities on the relevant record
dates. The record dates will be the 15th day of the month next preceding that in
which the relevant
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Distribution Date (as defined herein) falls. The amount of Distributions payable
for any period will be computed on the basis of a 360-day year of twelve 30-day
months. In the event that any date on which Distributions are payable on the
Exchange Capital Securities is not a Business Day (as defined below), payment of
the Distributions payable on such date will be made on the next succeeding day
that is a Business Day (and without any interest or other payment in respect to
any such delay), with the same force and effect as if made on such date (each
date on which Distributions are payable in accordance with the foregoing, a
"Distribution Date"). A "Business Day" shall mean any day other than a Saturday
or a Sunday, or a day on which banking institutions in New York, New York or
Burlington, Vermont are authorized or required by law or executive order to
remain closed.
So long as no Debenture Event of Default has occurred and is
continuing, the Corporation will have the right under the Indenture to elect to
defer the payment of interest on the Junior Subordinated Debentures at any time
or from time to time for a period not exceeding 10 consecutive semi-annual
periods with respect to each Extension Period, provided that no Extension Period
shall end on a date other than an Interest Payment Date or extend beyond the
Stated Maturity Date. Upon any such election, semi-annual Distributions on the
Capital Securities will be deferred by the Trust during such Extension Period.
Distributions to which holders of the Capital Securities are entitled during any
such Extension Period will accumulate additional Distributions thereon at the
rate per annum of 10.52% thereof, compounded semi-annually from the relevant
Distribution Date, but not exceeding the interest rate then accruing on the
Junior Subordinated Debentures. The term "Distributions," as used herein shall
include any such additional Distributions.
Prior to the termination of any Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 10 consecutive semi-annual periods, to end
on a date other than an Interest Payment Date or to extend beyond the Stated
Maturity Date. Upon the termination of any such Extension Period and the payment
of all amounts then due on the applicable Interest Payment Date, the Corporation
may elect to begin a new Extension Period, subject to the above requirements. No
interest shall be due and payable during an Extension Period, except at the end
thereof. The Corporation must give the Property Trustee, the Administrative
Trustees and the Debenture Trustee notice of its election of any Extension
Period (or an extension thereof) at least five Business Days prior to the
earlier of (i) the date the Distributions on the Exchange Capital Securities
would have been payable except for the election to begin such Extension Period
and (ii) the date the Trust is required to give notice to any securities
exchange or automated quotation system or to holders of the Exchange Capital
Securities of the record date or the date such Distributions are payable, but in
any event not less than five Business Days prior to such record date. There is
no limitation on the number of times that the Corporation may elect to begin an
Extension Period. See "--Description of Exchange Junior Subordinated
Debentures--Option to Extend Interest Payment Date" and "Certain Federal Income
Tax Consequences--Interest Income and Original Issue Discount."
During any Extension Period, the Corporation may not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock,
(ii) make any payment of principal of or premium, if any, or interest on or
repay, repurchase or redeem any debt securities of the Corporation (including
Other Debentures) that rank pari passu with or junior in right of payment to the
Junior Subordinated Debentures or (iii) make any guarantee payments with respect
to any guarantee by the Corporation of the debt securities of any subsidiary of
the Corporation (including Other Guarantees) if such guarantee ranks pari passu
with or junior in right of payment to the Junior Subordinated Debentures (other
than (a) dividends or distributions in shares of, or options, warrants or rights
to subscribe for or purchase shares of, common stock of the Corporation, (b) any
declaration of a dividend in connection with the
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implementation of a stockholders' rights plan, or the issuance of stock under
any such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under the Guarantee, (d) as a result of a
reclassification of the Corporation's capital stock or the exchange or
conversion of one class or series of the Corporation's capital stock for another
class or series of the Corporation's capital stock, (e) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged and (f) purchases of common stock of the
Corporation related to the issuance of common stock or rights under any of the
Corporation's benefit or compensation plans for its directors, officers or
employees or any of the Corporation's dividend reinvestment plans). The
Corporation has no current intention to exercise its option to defer payments of
interest on the Junior Subordinated Debentures thereby triggering a deferral of
Distributions on the Trust Securities.
The revenue of the Trust available for distribution to holders of the
Exchange Capital Securities will be limited to payments under the Exchange
Junior Subordinated Debentures in which the Trust will invest the proceeds from
the issuance and sale of the Trust Securities. See "--Description of Exchange
Junior Subordinated Debentures--General." If the Corporation does not make
interest payments on the Exchange Junior Subordinated Debentures, the Property
Trustee will not have funds available to pay Distributions on the Exchange
Capital Securities. The payment of Distributions on the Exchange Capital
Securities (if and to the extent the Trust has funds legally available for the
payment of such Distributions) will be guaranteed by the Corporation on a
limited basis as set forth herein under "--Description of Exchange Guarantee."
Redemption. Upon the repayment on the Stated Maturity Date or
prepayment in whole or in part prior to the Stated Maturity Date of the Junior
Subordinated Debentures (other than following the distribution of the Junior
Subordinated Debentures to the holders of the Trust Securities), the proceeds
from such repayment or prepayment shall be applied by the Property Trustee to
redeem a Like Amount (as defined below) of the Trust Securities, upon not less
than 30 nor more than 60 days' prior written notice of a date of redemption (the
"Redemption Date"), at the applicable Redemption Price, which shall be equal to
(i) in the case of the repayment of the Junior Subordinated Debentures on the
Stated Maturity Date, the Maturity Redemption Price (equal to the principal of,
and accrued and unpaid interest on, the Junior Subordinated Debentures), (ii) in
the case of the optional prepayment of the Junior Subordinated Debentures before
the Initial Optional Redemption Date upon the occurrence and continuation of a
Special Event (as defined herein), the Special Event Redemption Price (equal to
the Special Event Prepayment Price in respect of the Junior Subordinated
Debentures) and (iii) in the case of the optional prepayment of the Junior
Subordinated Debentures on or after the Initial Optional Redemption Date, the
Optional Redemption Price (equal to the Optional Prepayment Price in respect of
the Junior Subordinated Debentures). See "--Description of Exchange Junior
Subordinated Debentures--Optional Prepayment" and "--Special Event Prepayment."
If less than all of the Exchange Junior Subordinated Debentures are to be
prepaid prior to the Stated Maturity Date, then the proceeds of such prepayment
shall be allocated pro rata to the Trust Securities. If less than all of the
Capital Securities held in book-entry form are to be redeemed, such Capital
Securities will be redeemed in accordance with the procedures of DTC as
described under "--Form, Denomination, Book-Entry Procedures and Transfer."
"Like Amount" means (i) with respect to a redemption of the Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Junior Subordinated Debentures to be paid in accordance with their
terms and (ii) with respect to a distribution of Junior Subordinated Debentures
upon the liquidation of the 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.
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The Corporation will have the option to prepay the Exchange Junior
Subordinated Debentures, (i) in whole or in part, on or after the Initial
Optional Redemption Date, at the applicable Optional Prepayment Price and (ii)
in whole but not in part, at any time prior to the Initial Optional Redemption
Date, upon the occurrence of a Special Event, at the Special Event Prepayment
Price, in each case subject to the receipt of any required regulatory approvals.
See "--Description of Exchange Junior Subordinated Debentures--Optional
Prepayment" and "--Special Event Prepayment."
Liquidation of the Trust and Distribution of Exchange Junior
Subordinated Debentures. The Corporation will have the right at any time to
terminate the Trust and, after satisfaction of liabilities to creditors of the
Trust as required by applicable law, to cause the Junior Subordinated Debentures
to be distributed to the holders of the Trust Securities in liquidation of the
Trust. Such right is subject to the Corporation's having received (i) an opinion
of counsel to the effect that such distribution will not cause the holders of
Capital Securities to recognize gain or loss for federal income tax purposes and
(ii) any required regulatory approvals.
The Trust shall automatically terminate upon the first to occur of: (i)
certain events of bankruptcy, dissolution or liquidation of the Corporation;
(ii) the distribution of a Like Amount of the Junior Subordinated Debentures to
the holders of the Trust Securities, if the Corporation, as Sponsor, has given
written direction to the Property Trustee to terminate the Trust (which
direction is optional and, except as described above, wholly within the
discretion of the Corporation, as Sponsor); (iii) redemption of all of the Trust
Securities as described under "--Redemption;" (iv) expiration of the term of the
Trust; and (v) the entry of an order for the dissolution of the Trust by a court
of competent jurisdiction.
If a termination occurs as described in clause (i), (ii), (iv), or (v)
above, the Trust shall be liquidated by the Issuer Trustees as expeditiously as
the Issuer Trustees determine to be possible by distributing, after satisfaction
of liabilities to creditors of the Trust as provided by applicable law, to the
holders of the Trust Securities a Like Amount of the Junior Subordinated
Debentures, unless such distribution is determined by the Property Trustee not
to be practicable, in which event such holders will be entitled to receive out
of the assets of the Trust legally available for distribution to holders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the aggregate of the Liquidation Amount plus accumulated
and unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can be paid only
in part because the Trust has insufficient assets legally available to pay in
full the aggregate Liquidation Distribution, then the amounts payable directly
by the Trust on the Trust Securities shall be paid on a pro rata basis, except
that if a Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a priority over the Common Securities in respect of such
amounts. See "--Subordination of Common Securities." If an early termination
occurs, the Junior Subordinated Debentures will be subject to optional
prepayment, in whole or in part, on or after the Initial Optional Redemption
Date, unless such termination relates to the circumstances described in clause
(v) above, in which case the Junior Subordinated Debentures will be subject to
optional prepayment, in whole, but not in part, on or after the Initial Optional
Redemption Date.
After the liquidation date is fixed for any distribution of Junior
Subordinated Debentures to holders of the Trust Securities, (i) the Trust
Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee
will receive, in respect of each Global Capital Security held by it, a
registered global certificate representing the Junior Subordinated Debentures to
be delivered upon such distribution and (iii) any certificates representing
Trust Securities not held by DTC or its nominee will be deemed to represent
Junior Subordinated Debentures having a principal amount equal to the
Liquidation Amount of such Trust Securities, and bearing accrued and unpaid
interest in an
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amount equal to the accumulated and unpaid Distributions on such Trust
Securities until such certificates are presented to the Administrative Trustees
or their agent for cancellation, whereupon the Corporation will issue to such
holder, and the Debenture Trustee will authenticate, a certificate representing
such Junior Subordinated Debentures.
There can be no assurance as to the market prices for the Exchange
Capital Securities or the Exchange Junior Subordinated Debentures that may be
distributed in exchange for the Trust Securities if a dissolution and
liquidation of the Trust were to occur. Accordingly, the Exchange Capital
Securities that an investor may purchase, or the Exchange Junior Subordinated
Debentures that the investor may receive on dissolution and liquidation of the
Trust, may trade at a discount to the price that the investor paid to purchase
such securities.
Redemption Procedures. If applicable, Trust Securities shall be
redeemed at the applicable Redemption Price with the proceeds from the
contemporaneous repayment or prepayment of the Junior Subordinated Debentures.
Any redemption of Trust Securities shall be made and the applicable Redemption
Price shall be payable on the Redemption Date only to the extent that the Trust
has funds legally available for the payment of such applicable Redemption Price.
See "--Subordination of Common Securities."
If the Trust gives a notice of redemption in respect of the Exchange
Capital Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, to the extent funds are legally available, with respect to the Exchange
Capital Securities held by DTC or its nominees, the Property Trustee will
deposit or cause the Paying Agent (as defined herein) to deposit irrevocably
with DTC funds sufficient to pay the applicable Redemption Price. See "--Form,
Denomination, Book-Entry Procedures and Transfer." With respect to the Exchange
Capital Securities held in certificated form, the Property Trustee, to the
extent funds are legally available, will irrevocably deposit with the paying
agent for the Exchange Capital Securities funds sufficient to pay the applicable
Redemption Price and will give such paying agent irrevocable instructions and
authority to pay the applicable Redemption Price to the holders thereof upon
surrender of their certificates evidencing the Exchange Capital Securities. See
"--Payment and Paying Agency." Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date shall be payable to the holders of
such Exchange Capital Securities on the relevant record dates for the related
Distribution Dates. If notice of redemption shall have been given and funds
deposited as required, then upon the date of such deposit, all rights of the
holders of the Exchange Capital Securities called for redemption will cease,
except the right of the holders of such Exchange Capital Securities to receive
the applicable Redemption Price, but without interest on such Redemption Price,
and such Exchange Capital Securities will cease to be outstanding. In the event
that any Redemption Date of Exchange Capital Securities is not a Business Day,
then the applicable Redemption Price payable on such date will be paid on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay), with the same force and effect as if made
on such date, except that, if such next succeeding Business Day falls in the
next calendar year, such payment shall be made on the immediately preceding
Business Day. In the event that payment of the applicable Redemption Price is
improperly withheld or refused and not paid either by the Trust or by the
Corporation pursuant to the Exchange Guarantee as described under "--Description
of Exchange Guarantee" (i) Distributions on Exchange Capital Securities will
continue to accumulate at the then-applicable rate, from the Redemption Date
originally established by the Trust to the date such applicable Redemption Price
is actually paid and (ii) the actual payment date will be the Redemption Date
for purposes of calculating the applicable Redemption Price.
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Subject to applicable law (including, without limitation, United States
federal securities law), the Corporation or its subsidiaries may at any time and
from time to time purchase outstanding Exchange Capital Securities by tender, in
the open market or by private agreement.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days prior to the Redemption Date to each holder of Trust Securities at
its registered address. Unless the Corporation defaults in payment of the
applicable Prepayment Price on, or in the repayment of, the Junior Subordinated
Debentures, on and after the Redemption Date. Distributions will cease to accrue
on the Trust Securities called for redemption.
Subordination of Common Securities. Payment of Distributions on, and
the Redemption Price of, the Trust Securities, as applicable, shall be made pro
rata based on the Liquidation Amount of the Trust Securities; provided, however,
that if on any Distribution Date or Redemption Date a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution on, or
applicable Redemption Price of, any of the Common Securities, and no other
payment on account of the redemption, liquidation or other acquisition of the
Common Securities, shall be made unless payment in full in cash of all
accumulated and unpaid Distributions on all of the outstanding Capital
Securities for all Distribution periods terminating on or prior thereto, or in
the case of payment of the applicable Redemption Price the full amount of such
Redemption Price, shall have been made or provided for, and all funds available
to the Property Trustee shall first be applied to the payment in full in cash of
all Distributions on, or Redemption Price of, the Capital Securities then due
and payable.
In the case of any Event of Default, the Corporation as holder of the
Common Securities will be deemed to have waived any right to act with respect to
such Event of Default until the effect of such Event of Default shall have been
cured, waived or otherwise eliminated. Until any such Event of Default has been
so cured, waived or otherwise eliminated, the Property Trustee shall act solely
on behalf of the holders of the Capital Securities and not on behalf of the
Corporation as 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.
Events of Default; Notice. The occurrence of a Debenture Event of
Default (see "--Description of Exchange Junior Subordinated
Debentures--Debenture Events of Default") constitutes an "Event of Default"
under the Trust Agreement.
Within ten Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Exchange Capital
Securities, the Administrative Trustees and the Corporation, as Sponsor, unless
such Event of Default shall have been cured or waived. The Corporation, as
Sponsor, and the Administrative Trustees are required to file annually with the
Property Trustee a certificate as to whether or not they are in compliance with
all the conditions and covenants applicable to them under the Trust Agreement.
If a Debenture Event of Default has occurred and is continuing, the
Capital Securities shall have a preference over the Common Securities as
described under "--Liquidation of the Trust and Distribution of Exchange Junior
Subordinated Debentures" and "--Subordination of Common
Securities."
Removal of Issuer Trustees. Unless a Debenture Event of Default shall
have occurred and be continuing, any Issuer Trustee may be removed at any time
by the holder of the Common Securities.
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If a Debenture Event of Default has occurred and is continuing, the Property
Trustee and the Delaware Trustee may be removed at such time by the holders of a
majority in Liquidation Amount of the outstanding Capital Securities. In no
event will the holders of the Exchange Capital Securities have the right to vote
to appoint, remove or replace the Administrative Trustees, which voting rights
are vested exclusively in the Corporation as the holder of the Common
Securities. No resignation or removal of an Issuer Trustee and no appointment of
a successor trustee shall be effective until the acceptance of appointment by
the successor trustee in accordance with the provisions of the Trust Agreement.
Merger or Consolidation of Issuer Trustees. Any Person into which the
Property Trustee, the Delaware Trustee or any Administrative Trustee that is not
a natural person may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Issuer Trustee shall be a party, or any Person
succeeding to all or substantially all the corporate trust business of such
Issuer Trustee, shall be the successor of such Issuer Trustee under the Trust
Agreement, provided such Person shall be otherwise qualified and eligible.
Mergers, Consolidations, Amalgamation or Replacements of the Trust. The
Trust may not merge with or into, consolidate, amalgamate, or be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to any corporation or other Person, except as
described below or as otherwise described under "--Liquidation of the Trust and
Distribution of Exchange Junior Subordinated Debentures." The Trust may, at the
request of the Corporation, as Sponsor, with the consent of the Administrative
Trustees but without the consent of the holders of the Exchange Capital
Securities, merge with or into, consolidate, amalgamate, or be replaced by or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to a trust organized as such under the laws of any
State; provided, that (i) such successor entity either (a) expressly assumes all
of the obligations of the Trust with respect to the Trust Securities or (b)
substitutes for the Trust Securities other securities having substantially the
same terms as the Trust Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Trust Securities rank in priority with
respect to distributions and payments upon liquidation, redemption and
otherwise, (ii) the Corporation expressly appoints a trustee of such successor
entity possessing the same powers and duties as the Property Trustee with
respect to the Junior Subordinated Debentures, (iii) the Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on each national securities exchange or other organization on which
the Trust Securities are then listed or quoted, if any, (iv) if the Capital
Securities (including any Successor Securities) or Junior Subordinated
Debentures are rated by any nationally recognized statistical rating
organization prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, such transaction does not cause the Capital
Securities (including any Successor Securities) or Junior Subordinated
Debentures to be downgraded by any such nationally recognized statistical rating
organization, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Trust Securities (including any Successor
Securities) in any material respect (other than any dilution of such holders'
interests in the new entity), (vi) such successor entity has a purpose identical
to that of the Trust, (vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Corporation has received an
opinion from independent counsel to the Trust experienced in such matters to the
effect that (a) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the holders of the Trust Securities (including any Successor
Securities) in any material respect (other than any dilution of such holders'
interests in the new entity) and (b) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, neither the Trust
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nor such successor entity will be required to register as an investment company
under the Investment Company Act of 1940, as amended (the "Investment Company
Act"), and (viii) the Corporation or any permitted successor or assignee owns
all of the common securities of such successor entity and guarantees the
obligations of such successor entity under the Successor Securities at least to
the extent provided by the Guarantee and the Common Guarantee. Notwithstanding
the foregoing, the Trust shall not, except with the consent of holders of 100%
in Liquidation Amount of the Trust Securities, consolidate, amalgamate, merge
with or into, or be replaced by or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to, any other entity or
permit any other entity to consolidate, amalgamate, merge with or into, or
replace it if such consolidation, amalgamation, merger, replacement, conveyance,
transfer or lease would cause the Trust or the successor entity not to be
classified as a grantor trust for United States federal income tax purposes.
Voting Rights: Amendment of the Trust Agreement. Except as provided
below and under "--Mergers, Consolidations, Amalgamation or Replacements of the
Trust" and "--Description of Exchange Guarantee--Amendments and Assignment" and
as otherwise required by law and the Trust Agreement, the holders of the
Exchange Capital Securities will have no voting rights.
The Trust Agreement may be amended from time to time by the
Corporation, the Property Trustee and the Administrative Trustees, without the
consent of the holders of the Trust Securities (i) to cure any ambiguity,
correct or supplement any provisions in the Trust Agreement that may be
inconsistent with any other provision, or to make any other provisions with
respect to matters or questions arising under the Trust Agreement, which shall
not be inconsistent with the other provisions of the Trust Agreement, (ii) to
modify, eliminate or add to any provisions of the Trust Agreement to such extent
as shall be necessary to ensure that the Trust will be classified for United
States federal income tax purposes as a grantor trust at all times that any
Trust Securities are outstanding or to ensure that the Trust will not be
required to register as an "investment company" under the Investment Company Act
or (iii) to modify, eliminate or add any provisions of the Trust Agreement to
such extent as shall be necessary to enable the Trust or the Corporation to
conduct an Exchange Offer in the manner contemplated by the Registration Rights
Agreement; provided, however, that in each case, such action shall not adversely
affect in any material respect the interests of the holders of the Trust
Securities. Any amendments of the Trust Agreement pursuant to the foregoing
shall become effective when notice thereof is given to the holders of the Trust
Securities. The Trust Agreement may be amended by the Issuer Trustees and the
Corporation (i) with the consent of holders representing a majority (based upon
Liquidation Amount) of the outstanding Trust Securities and (ii) upon receipt by
the Issuer Trustees of an opinion of counsel experienced in such matters to the
effect that such amendment or the exercise of any power granted to the Issuer
Trustees in accordance with such amendment will not affect the Trust's status as
a grantor trust for United States federal income tax purposes or the Trust's
exemption from status as an "investment company" under the Investment Company
Act, provided that, without the consent of each holder of Trust Securities, the
Trust Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a holder of Trust Securities to
institute suit for the enforcement of any such payment on or after such date.
The Exchange Capital Securities and any Original Capital Securities that remain
outstanding after consummation of 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.
So long as any Junior Subordinated Debentures are held by the Property
Trustee, the Issuer Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy
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available to the Debenture Trustee, or execute any trust or power conferred on
the Debenture Trustee with respect to the Junior Subordinated Debentures, (ii)
waive certain past defaults under the Indenture, (iii) exercise any right to
rescind or annul a declaration of acceleration of the maturity of the principal
of the Junior Subordinated Debentures or (iv) consent to any amendment,
modification or termination of the Indenture or the Junior Subordinated
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the holders of a majority in Liquidation Amount
of all outstanding 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 approval of each holder of the Capital
Securities. The Issuer Trustees shall not revoke any action previously
authorized or approved by a vote of the holders of the Capital Securities except
by subsequent vote of such holders. The Property Trustee shall 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
such holders of the Capital Securities, prior to taking any of the foregoing
actions, the Issuer Trustees shall obtain an opinion of counsel experienced in
such matters to the effect that the Trust will not be classified as an
association taxable as a corporation for United States federal income tax
purposes on account of such action.
Any required approval of holders of Exchange Capital Securities may be
given at a meeting of such holders convened for such purpose or pursuant to
written consent. The Property Trustee will cause a notice of any meeting at
which holders of Exchange 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 holder of record of Exchange Capital Securities in the manner
set forth in the Trust Agreement.
No vote or consent of the holders of Exchange Capital Securities will
be required for the Trust to redeem and cancel the Exchange Capital Securities
in accordance with the Trust Agreement.
Notwithstanding that holders of the Exchange Capital Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Exchange Capital Securities that are owned by the Corporation or any
affiliate of the Corporation shall, for purposes of such vote or consent, be
treated as if they were not outstanding.
Form, Denomination, Book-Entry Procedures and Transfer. The Exchange
Capital Securities initially will be represented by one or more Exchange Capital
Securities in registered, global form (the "Global Capital Securities"). The
Global Capital Securities will be deposited upon issuance with the Property
Trustee as custodian for DTC, in New York, New York, and registered in the name
of DTC or its nominee, in each case for credit to an account of a direct or
indirect participant in DTC as described below.
In the event that Exchange Capital Securities are issued in
certificated form, the Exchange Capital Securities will be in blocks having a
Liquidation Amount of not less than $100,000 (100 Capital Securities) and may be
transferred or exchanged on in such blocks in the manner described herein.
Except as set forth below, the Global Capital Securities may be
transferred, in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the Global Capital
Securities may not be exchanged for Exchange Capital Securities in certificated
form except in the limited circumstances described below. See "--Exchange of
Book-Entry Capital Securities for Certificated Capital Securities."
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Depositary Procedures. DTC has advised the Trust and the Corporation
that DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the Uniform Commercial Code and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. DTC was created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants, thereby
eliminating the need for physical movement of certificates. Participants include
securities brokers and dealers (including the Initial Purchaser), banks, trust
companies, clearing corporations and certain other organizations. Indirect
access to DTC's system is also available to other entities such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interest and transfer of ownership interest
of each actual purchaser of each security held by or on behalf of DTC are
recorded on the records of the Participants and Indirect Participants.
DTC has also advised the Trust and the Corporation that, pursuant to
procedures established by it, (i) upon deposit of the Global Capital Securities,
DTC will credit the accounts of Participants designated by the Initial Purchaser
with portions of the Liquidation Amount of the Global Capital Securities and
(ii) ownership of such interests in the Global Capital Securities will be shown
on, and the transfer of ownership thereof will be effected only through, records
maintained by DTC (with respect to the Participants) or by the Participants and
the Indirect Participants (with respect to other owners of beneficial interests
in the Global Capital Securities).
Investors in the Global Capital Securities may hold their interests
therein directly through DTC if they are Participants, or indirectly through
organizations that are Participants. All interests in a Global Capital Security
will be subject to the procedures and requirements of DTC. The laws of some
states require that certain persons take physical delivery in certificated form
of securities that they own. Consequently, the ability to transfer beneficial
interests in a Global Capital Security to such persons will be limited to that
extent. Because DTC can act only on behalf of Participants, which in turn act on
behalf of Indirect Participants and certain banks, the ability of a person
having beneficial interests in a Global Capital Security to pledge such
interests to persons or entities that do not participate in the DTC system, or
otherwise take actions in respect of such interests, may be affected by the lack
of a physical certificate evidencing such interests. For certain other
restrictions on the transferability of the Exchange Capital Securities, see
"--Exchange of Book-Entry Capital Securities for Certificated Capital
Securities" and Exchange of Certificated Capital Securities for Book-Entry
Capital Securities."
Except as described below, owners of interests in the Global Capital
Securities will not have Exchange Capital Securities registered in their names,
will not receive physical delivery of Exchange Capital Securities in
certificated form and will not be considered the registered owners or holders
thereof under the Trust Agreement for any purpose.
Payments in respect of the Global Capital Security registered in the
name of DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder under the Trust Agreement. Under the terms of
the Trust Agreement, the Property Trustee will treat the persons in whose names
the Exchange Capital Securities, including the Global Capital Securities, are
registered as the owners thereof for the purpose of receiving such payments and
for any and all other purposes whatsoever. Consequently, neither the Property
Trustee nor any agent thereof has or will
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have any responsibility or liability for (i) any aspect of DTC's records or any
Participant's or Indirect Participant's records relating to or payments made on
account of beneficial ownership interests in the Global Capital Securities, or
for maintaining, supervising or reviewing any of DTC's records or any
Participant's or Indirect Participant's records relating to the beneficial
ownership interests in the Global Capital Securities or (ii) any other matter
relating to the actions and practices of DTC or any of its Participants or
Indirect Participants. DTC has advised the Trust and the Corporation that its
current practice, upon receipt of any payment in respect of securities such as
the Global Capital Securities, is to credit the accounts of the relevant
Participants with the payment on the payment date, in amounts proportionate to
their respective holdings in Liquidation Amount of beneficial interests in the
relevant security as shown on the records of DTC unless DTC has reason to
believe it will not receive payment on such payment date. Payments by the
Participants and the Indirect Participants to the beneficial owners of the
Global Capital Securities will be governed by standing instructions and
customary practices and will be the responsibility of the Participants or the
Indirect Participants and will not be the responsibility of DTC, the Property
Trustee, the Trust or the Corporation. None of the Trust, the Corporation or the
Property Trustee will be liable for any delay by DTC or any of its Participants
in identifying the beneficial owners of the Global Capital Securities, and the
Trust or the Corporation and the Property Trustee may conclusively rely on and
will be protected in relying on instructions from DTC or its nominee for all
purposes.
Secondary market trading activity in interests in the Global Capital
Securities will settle in immediately available funds, subject in all cases to
the rules and procedures of DTC and its Participants. Transfers between
Participants in DTC will be effected in accordance with DTC's procedures, and
will settle in same-day funds.
DTC has advised the Trust and the Corporation that it will take any
action permitted to be taken by a holder of Exchange Capital Securities
(including, without limitation, the presentation of Exchange Capital Securities
for exchange as described below) only at the direction of one or more
Participants to whose account with DTC interests in the Global Capital
Securities are credited and only in respect of such portion of the Liquidation
Amount of the Exchange Capital Securities as to which such Participant or
Participants has or have given such direction. However, if there is an Event of
Default under the Trust Agreement, DTC reserves the right to exchange the Global
Capital Securities for Exchange Capital Securities in certificated form and to
distribute such Exchange Capital Securities to its Participants.
The information in this section concerning DTC and its book-entry
system has been obtained from sources that the Trust and the Corporation believe
to be reliable, but neither the Trust nor the Corporation takes responsibility
for the accuracy thereof.
Although DTC has agreed to the foregoing procedures to facilitate
transfers of interest in the Global Capital Securities among Participants in
DTC, it is under no obligation to perform or to continue to perform such
procedures, and such procedures may be discontinued at any time. None of the
Trust, the Corporation or the Property Trustee will have any responsibility for
the performance by DTC or its Participants or Indirect Participants of their
respective obligations under the rules and procedures governing DTC's
operations.
Exchange of Book-Entry Capital Securities for Certificated Capital
Securities. A Global Capital Security is exchangeable for Exchange Capital
Securities in registered certificated form if (i) DTC (x) notifies the Trust
that it is unwilling or unable to continue as Depositary for the Global Capital
Security and the Trust thereupon fails to appoint a successor Depositary within
90 days or (y) has ceased to be a clearing agency registered under the Exchange
Act, and the Trust thereupon fails
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to appoint a successor Depositary within 90 days, (ii) the Corporation in its
sole discretion elects to cause the issuance of the Exchange Capital Securities
in certificated form or (iii) there shall have occurred and be continuing an
Event of Default or any event which after notice or lapse of time or both would
be an Event of Default under the Trust Agreement. In addition, beneficial
interests in a Global Capital Security may be exchanged by or on behalf of DTC
for certificated Exchange Capital Securities upon request by DTC, but only upon
at least 20 days' prior written notice given to the Property Trustee in
accordance with DTC's customary procedures. In all cases, certificated Exchange
Capital Securities delivered in exchange for any Global Capital Security or
beneficial interests therein will be registered in the names, and issued in any
approved denominations, requested by or on behalf of DTC (in accordance with its
customary procedures), unless the Property Trustee determines otherwise in
compliance with applicable law.
Exchange of Certificated Capital Securities for Book-Entry Capital
Securities. Other Capital Securities, which will be issued in certificated form,
may not be exchanged for beneficial interests in any Global Capital Security
unless such exchange occurs in connection with a transfer of such Other Capital
Securities and the transferor first delivers to the Property Trustee a written
certificate (in the form provided in the Trust Agreement) to the effect that
such transfer will comply with the appropriate transfer restrictions applicable
to such Capital Securities.
Payment and Paying Agency. Payments in respect of the Global Capital
Securities shall be made to DTC which shall credit the relevant accounts at DTC
on the applicable Distribution Dates and payments in respect of the Exchange
Capital Securities that are not held by DTC shall be made by check mailed to the
address of the holder entitled thereto as such address shall appear on the
register. The paying agent (the "Paying Agent") shall initially be the Property
Trustee and any co-paying agent chosen by the Property Trustee and acceptable to
the Administrative Trustees and the Corporation. The Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' prior written notice to the
Property Trustee, the Administrative Trustees and the Corporation. In the event
that the Property Trustee shall no longer be the Paying Agent, the
Administrative Trustees shall appoint a successor (which shall be a bank or
trust company acceptable to the Administrative Trustees and the Corporation) to
act as Paying Agent.
Restrictions on Transfer. The Exchange 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) and multiples of $1,000 in excess
thereof. Any attempted sale, transfer or other disposition of Exchange Capital
Securities in a block having an aggregate 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 Exchange Capital
Securities for any purpose, including but not limited to the receipt of
Distributions on such Exchange Capital Securities, and such transferee shall be
deemed to have no interest whatsoever in such Exchange Capital Securities.
Registrar and Transfer Agent. The Property Trustee will act as
registrar and transfer agent for the Exchange Capital Securities.
Registration of transfers of the Exchange Capital Securities will be
effected without charge by or on behalf of the Trust, but upon payment of any
tax or other governmental charges that may be imposed in connection with any
transfer or exchange. The Trust will not be required to register or cause to be
registered the transfer of the Exchange Capital Securities after they have been
called for redemption.
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Information Concerning the Property Trustee. The Property Trustee,
other than during the occurrence and continuance of an Event of Default, will
undertake to perform only such duties as are specifically set forth in the Trust
Agreement and, during the existence of an Event of Default, must exercise the
same degree of care and skill as a prudent person would exercise or use in the
conduct of his or her own affairs. Subject to this provision, the Property
Trustee is under no obligation to exercise any of the powers vested in it by the
Trust Agreement at the request of any holder of Trust Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby. If no Event of Default has occurred and is continuing
and the Property Trustee is required to decide between alternative causes of
action, construe ambiguous provisions in the Trust Agreement or is unsure of the
application of any provision of the Trust Agreement, and the matter is not one
on which holders of the Exchange Capital Securities or the Common Securities are
entitled under the Trust Agreement to vote, then the Property Trustee shall take
such action as is directed by the Corporation and, if not so directed, shall
take such action as it deems advisable and in the best interests of the holders
of the Trust Securities and will have no liability except for its own bad faith,
negligence or willful misconduct.
Miscellaneous. The Administrative Trustees are authorized and directed
to conduct the affairs of and to operate the Trust in such a way that (i) the
Trust will not be deemed to be an "investment company" required to be registered
under the Investment Company Act, (ii) the Trust will be classified as a grantor
trust for United States federal income tax purposes and (iii) the Junior
Subordinated Debentures will be treated as indebtedness of the Corporation for
United States federal income tax purposes. The Corporation and the
Administrative Trustees are authorized to take any action, not inconsistent with
applicable law, the certificate of trust of the Trust or the Trust Agreement,
that the Administrative Trustees determine in their discretion to be necessary
or desirable for such purposes, as long as such action does not materially
adversely affect the interests of the holders of the Trust Securities.
The Trust Agreement provides that (i) holders of the Trust Securities
have no preemptive or similar rights to subscribe for any additional Trust
Securities, and (ii) the issuance of the Trust Securities are not subject to
preemptive or similar rights.
The Trust may not borrow money, issue debt, execute mortgages or pledge
any of its assets.
Description of Exchange Junior Subordinated Debentures
The Exchange Junior Subordinated Debentures are to be issued under an
Indenture, as amended and supplemented from time to time (as so amended and
supplemented, the "Indenture"), between the Corporation and The First National
Bank of Chicago, as Debenture Trustee (the "Debenture Trustee"). The Indenture
will be qualified under the Trust Indenture Act and, by its terms, will
incorporate certain provisions of the Trust Indenture Act. The Indenture will be
subject to and governed by the Trust Indenture Act. This summary of certain
terms and provisions of the Exchange Junior Subordinated Debentures and the
Indenture does not purport to be complete, and where reference is made to
particular provisions of the Indenture, such provisions, including the
definitions of certain terms, some of which are not otherwise defined herein,
are qualified in their entirety by reference to all of the provisions of the
Indenture and those terms made a part of the Indenture by the Trust Indenture
Act.
General. Concurrently with the issuance of the Original Capital
Securities, the Trust invested the proceeds thereof, together with the
consideration paid by the Corporation for the Common Securities, in Original
Junior Subordinated Debentures issued by the Corporation. Pursuant to the
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Exchange Offer, the Corporation will exchange the Exchange Junior Subordinated
Debentures for Original Junior Subordinated Debentures accepted for exchange.
The Exchange Junior Subordinated Debentures will bear interest at the
annual rate of 10.52% of the principal amount thereof, payable semi-annually in
arrears on May 1 and November 1 of each year, commencing November 1, 1997 or
May 1, 1998, as the case may be (each, an "Interest Payment Date"), to the
person in whose name each Exchange Junior Subordinated Debenture is registered,
subject to certain exceptions, at the close of business on the 15th day of the
month next preceding that in which the relevant Interest Payment Date falls. It
is anticipated that, until the liquidation, if any, of the Trust, each Junior
Subordinated Debenture will be held in the name of the Property Trustee in trust
for the benefit of the holders of the Trust Securities. The amount of interest
payable for any period will be computed on the basis of a 360-day year of twelve
30-day months. In the event that any date on which interest is payable on the
Exchange Junior Subordinated Debentures is not a Business Day, then payment of
the interest payable on such date will be made on the next succeeding day that
is a Business Day (and without any interest or other payment in respect of any
such delay), with the same force and effect as if made on such date. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at
the rate per annum of 10.52% thereof, compounded semi-annually. The term
"interest," as used herein, shall include semi-annual interest payments,
interest on semi-annual interest payments not paid on the applicable Interest
Payment Date and Additional Sums (as defined below), as applicable.
The Exchange Junior Subordinated Debentures will be issued pursuant to
the Indenture. The Exchange Junior Subordinated Debentures will mature on May 1,
2027.
The Exchange Junior Subordinated Debentures will be unsecured and will
rank pari passu with the Original Junior Subordinated Debentures and all Other
Debentures and subordinate and junior in right of payment to all Senior
Indebtedness to the extent and in the manner set forth in the Indenture. See
"--Subordination."
Almost all of the operating assets of the Corporation and its
consolidated subsidiaries are owned by such subsidiaries. The Corporation is a
legal entity separate and distinct from the Banks and its other subsidiaries.
Holders of Junior Subordinated Debentures should look only to the Corporation
for payments on the Junior Subordinated Debentures. The principal sources of the
Corporation's income are dividends and interest from the Banks and its other
subsidiaries, and there are various limitations on the Banks to pay such
dividends, as discussed below. The Banks are also subject to certain
restrictions on the transfer of funds by each of such depository institutions to
the Corporation and certain other affiliates, in the form of loans, other
extensions of credit, investments or purchases of assets. Transfers by any Bank
to the Corporation or any single affiliate are generally limited in amount as to
the Corporation and as to each of such other affiliates to 10% of such Bank's
capital and surplus and transfers to all affiliates are limited in the aggregate
to 20% of such Bank's capital and surplus. Furthermore, such loans and
extensions of credit are subject to various collateral requirements.
Because the Corporation is a holding company, the Corporation's
operations are conducted by its subsidiaries, including the Banks, which are
subject to significant federal and state regulation. The Corporation's ability
to receive dividends and loans from its subsidiaries is restricted. As of
December 31, 1996, the Banks were able to declare dividends to the Corporation
in 1997, without regulatory approval, of approximately $4.7 million. In
addition, in February 1996, as part of its plan to capitalize the Corporation's
newly formed subsidiary bank, First Massachusetts Bank, N.A., at a
"well-capitalized" level for regulatory capital purposes, the Corporation
redeployed accumulated
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capital of $45.6 million in the form of special dividends from certain of the
Banks. Because the amounts of the special dividends exceeded applicable
regulatory limitations, the Corporation obtained the necessary regulatory
approvals to effect such redeployment. Payment of the special dividends has
significantly restricted the dividend paying capacity of the Banks. Accordingly,
payment of any dividends to the Corporation by certain of the Banks currently
requires regulatory approval on account of the aforementioned special dividends,
and payments of dividends by the Banks in the future will require their
generation of sufficient future earnings. Further, the right of the Corporation
to participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability of
holders of the Capital Securities to benefit indirectly from such distribution )
is subject to the prior claims of creditors of such subsidiary (including
depositors in the case of the Banks), except to the extent that the Corporation
may itself be recognized as a creditor of that subsidiary. Accordingly, the
Junior Subordinated Debentures effectively will be subordinated to all existing
and future liabilities of the Corporation's subsidiaries (including deposit
liabilities of the Banks), and holders of Junior Subordinated Debentures should
look only to the assets of the Corporation for payments on the Junior
Subordinated Debentures.
The Indenture does not limit the amount of secured or unsecured debt,
including Senior Indebtedness, that may be incurred by the Corporation or any of
its subsidiaries. At December 31, 1996, the Corporation had $13.0 million of
Senior Indebtedness outstanding, and the Corporation's subsidiaries had total
liabilities (excluding liabilities owed to the Corporation) of $2.4 billion. See
"--Subordination." The Corporation expects from time to time that it will incur
additional indebtedness constituting Senior Indebtedness and that its
subsidiaries will incur additional liabilities.
Form, Registration and Transfer. If the Exchange Junior Subordinated
Debentures are distributed to the holders of the Trust Securities, the Exchange
Junior Subordinated Debentures may be represented by a global certificate
registered in the name of Cede & Co. as the nominee of DTC. The depositary
arrangements for such Exchange Junior Subordinated Debentures are expected to be
substantially similar to those in effect for the Exchange Capital Securities.
For a description of DTC and the terms of the depositary arrangements relating
to payments, transfers, voting rights, prepayments, notices and other matters,
see "--Description of Exchange Capital Securities--Form, Denomination,
Book-Entry Procedures and Transfer."
Payment and Paying Agents. Payment of principal of (and premium, if
any) and interest on Exchange Junior Subordinated Debentures will be made at the
office of the Debenture Trustee in New York, New York or at the office of such
Paying Agent or Paying Agents as the Corporation may designate from time to
time, except that at the option of the Corporation payment of any interest may
be made, except in the case of Exchange Junior Subordinated Debentures in global
form, (i) by check mailed to the address of the Person entitled thereto as such
address shall appear in the register for Exchange Junior Subordinated Debentures
or (ii) by transfer to an account maintained by the Person entitled thereto as
specified in such register, provided that proper transfer instructions have been
received by the relevant record date. Payment of any interest on any Exchange
Junior Subordinated Debenture will be made to the Person in whose name such
Exchange Junior Subordinated Debenture is registered at the close of business on
the record date for such interest, except in the case of defaulted interest. The
Corporation may at any time designate additional Paying Agents or rescind the
designation of any Paying Agent; provided, however, the Corporation will at all
times be required to maintain a Paying Agent in each place of payment for the
Exchange Junior Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any Paying Agent, or
then held by the Corporation in trust, for the payment of the principal of (and
premium, if any) or interest on any
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Exchange 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 Corporation, be repaid to the Corporation
and the holder of such Exchange Junior Subordinated Debenture shall thereafter
look, as a general unsecured creditor, only to the Corporation for payment
thereof.
Option to Extend Interest Payment Date. So long as no Debenture Event
of Default has occurred and is continuing, the Corporation will have the right
under the Indenture to defer the payment of interest on the Junior Subordinated
Debentures at any time and from time to time for a period not exceeding 10
consecutive semi-annual periods with respect to each Extension Period, provided
that no Extension Period shall end on a date other than an Interest Payment Date
or extend beyond the Stated Maturity Date. At the end of an Extension Period,
the Corporation must pay all interest then accrued and unpaid (together with
interest thereon at the annual rate of 10.52%, compounded semi-annually, to the
extent permitted by applicable law ("Compounded Interest")). During an Extension
Period, interest will continue to accrue and holders of Junior Subordinated
Debentures (or holders of the Trust Securities while Trust Securities are
outstanding) will be required to accrue such deferred interest income for United
States federal income tax purposes prior to the receipt of cash attributable to
such income. See "Certain Federal Income Tax Consequences--Interest Income and
Original Issue Discount."
During any Extension Period, the Corporation may not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock,
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation (including
any Other Debentures) that rank pari passu with or junior in right of payment to
the Junior Subordinated Debentures or (iii) make any guarantee payments with
respect to any guarantee by the Corporation of the debt securities of any
subsidiary of the Corporation (including any Other Guarantees) if such guarantee
ranks pari passu with or junior in right of payment to the Junior Subordinated
Debentures (other than (a) dividends or distributions in shares of, or options,
warrants or rights to subscribe for or purchase shares of, common stock of the
Corporation, (b) any declaration of a dividend in connection with the
implementation of a stockholders' rights plan, or the issuance of stock under
any such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under the Guarantee, (d) as a result of a
reclassification of the Corporation's capital stock or the exchange or
conversion of one class or series of the Corporation's capital stock for another
class or series of the Corporation's capital stock, (e) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged and (f) purchases of common stock of the
Corporation related to the issuance of common stock or rights under any of the
Corporation's benefit or compensation plans for its directors, officers or
employees or any of the Corporation's dividend reinvestment plans).
Prior to the termination of any such Extension Period, the Corporation
may further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 10 consecutive semi-annual periods, end on
a date other than an Interest Payment Date or extend beyond the Stated Maturity
Date. Upon the termination of any such Extension Period and the payment of all
amounts then due on any Interest Payment Date, the Corporation may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
The Corporation must give the Property Trustee, the Administrative Trustees and
the Debenture Trustee notice of its election of any Extension Period (or an
extension thereof) at least five Business Days prior to the earlier of (i) the
date the Distributions on the Trust Securities would have been payable except
for the election to begin or
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extend such Extension Period or (ii) the date the Property Trustee is required
to give notice to any securities exchange or to holders of Exchange Capital
Securities of the record date or the date such Distributions are payable, but in
any event not less than five Business Days prior to such record date. The
Debenture Trustee shall give notice of the Corporation's election to begin or
extend a new Extension Period to the holders of the Exchange Capital Securities.
There is no limitation on the number of times that the Corporation may elect to
begin an Extension Period.
Optional Prepayment. The Exchange Junior Subordinated Debentures will
be prepayable, in whole or in part, at the option of the Corporation on or after
the Initial Optional Redemption Date, subject to the Corporation having received
any required regulatory approvals, at a prepayment price (the "Optional
Prepayment Price") equal to the percentage of the outstanding principal amount
of the Exchange Junior Subordinated Debentures specified below, plus, in each
case, accrued and unpaid interest thereon, including Compounded Interest, if
any, to the date of prepayment if prepaid during the 12-month period beginning
May 1 of the years indicated below:
Year Percentage
---- ----------
2007 105.260%
2008 104.734%
2009 104.208%
2010 103.682%
2011 103.156%
2012 102.630%
2013 102.104%
2014 101.578%
2015 101.052%
2016 100.526%
2017 and thereafter 100.000%
Special Event Prepayment. Prior to the Initial Optional Redemption
Date, if a Special Event shall occur and be continuing, the Corporation may, at
its option and subject to receipt of any required regulatory approvals, prepay
the Exchange Junior Subordinated Debentures in whole (but not in part) at any
time within 90 days of the occurrence of such Special Event, at a prepayment
price (the "Special Event Prepayment Price") equal to the Make-Whole Amount. The
"Make-Whole Amount" shall be equal to the greater of (x) 100% of the principal
amount thereof or (y) the sum, as determined by a Quotation Agent (as defined
herein), of the present values of the remaining scheduled payments of principal
and interest on the Exchange Junior Subordinated Debentures, discounted to the
prepayment date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate, plus, in the case of each
of clauses (x) and (y), accrued and unpaid interest thereon (including
Compounded Interest and Additional Sums, if any) to the date of prepayment.
A "Special Event" means a Tax Event or a Regulatory Capital Event, as
the case may be.
A "Tax Event" means the receipt by the Corporation and the Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective change) in,
the laws or any regulations thereunder of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after
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April 28, 1997, there is more than an insubstantial risk that (i) the Trust is,
or will be within 90 days of the date of such opinion, subject to United States
federal income tax with respect to income received or accrued on the Junior
Subordinated Debentures, (ii) the interest payable by the Corporation on the
Junior Subordinated Debentures is not, or within 90 days of the date of such
opinion will not be, deductible by the Corporation, in whole or in part, for
United States federal income tax purposes or (iii) the Trust is, or will be
within 90 days of the date of such opinion, subject to more than a de minimis
amount of other taxes, duties or other governmental charges.
A "Regulatory Capital Event" means that the Corporation shall have
received an opinion of independent bank regulatory counsel experienced in such
matters to the effect that, as a result of (a) any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any rules, guidelines or policies of an
applicable regulatory authority for the Corporation or (b) any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after April 28, 1997, the Capital
Securities do not constitute, or within 90 days of the date thereof, will not
constitute, Tier 1 Capital (or its then-equivalent); provided, however, that the
distribution of the Junior Subordinated Debentures in connection with the
liquidation of the Trust by the Corporation shall not in and of itself
constitute a Regulatory Capital Event unless such liquidation shall have
occurred in connection with a Tax Event.
"Adjusted Treasury Rate" means, with respect to any prepayment date,
the rate per annum equal to (i) the yield, under the heading which represents
the average for the immediately prior week, 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 maturity corresponding to
the Remaining Life, yields for the two published maturities most closely
corresponding to the Remaining Life shall be determined, and the Adjusted
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 prepayment date, in each case calculated on the third Business Day
preceding the prepayment date, plus in each case (a) 3.31% if such prepayment
date occurs on or prior to May 1, 1998 and (b) 2.76% in all other cases.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the Remaining
Life of the Junior Subordinated Debentures 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
of the Junior Subordinated Debentures, provided that if no United States
Treasury security has a maturity which is within a period from three months
before to three months after the Remaining Life, the two most closely
corresponding United States Treasury securities shall be used as the Comparable
Treasury Issue, and the Adjusted Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month, using such
securities.
"Comparable Treasury Price" means, with respect to any prepayment date,
(i) the average of three Reference Treasury Dealer Quotations for such
prepayment date, after excluding the highest and
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lowest Reference Treasury Dealer Quotations, or (ii) if the Debenture Trustee
obtains fewer than five such Reference Treasury Dealer Quotations, the average
of all such Reference Treasury Dealer Quotations.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Corporation. "Reference Treasury Dealer" means a nationally-recognized U.S.
Government securities dealer in New York City selected by the Corporation.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any prepayment 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 prepayment date.
"Remaining Life" means the term of the Junior Subordinated Debentures
from the prepayment date to the Stated Maturity Date.
Notice of any prepayment will be mailed at least 30 days but not more
than 60 days before the prepayment date to each holder of Exchange Junior
Subordinated Debentures to be prepaid at its registered address. Unless the
Corporation defaults in payment of the prepayment price, on and after the
prepayment date interest ceases to accrue on such Exchange Junior Subordinated
Debentures called for prepayment.
If the Trust is required to pay any additional taxes, duties or other
governmental charges as a result of a Tax Event, the Corporation will pay as
additional amounts on the Junior Subordinated Debentures such amounts as shall
be necessary in order that the amount of Distributions then due and payable by
the Trust on the outstanding Trust Securities shall not be reduced as a result
of any additional taxes, duties and other governmental charges to which the
Trust has become subject as a result of a Tax Event ("Additional Sums").
Certain Covenants of the Corporation. The Corporation will also
covenant 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 Corporation's capital stock, (ii) make any payment of principal of or
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Corporation (including Other Debentures) that rank pari passu
with or junior in right of payment to the Junior Subordinated Debentures or
(iii) make any guarantee payments other than payments under the Guarantee with
respect to any guarantee by the Corporation of the debt securities of any
subsidiary of the Corporation (including under Other Guarantees) if such
guarantee ranks pari passu or junior in right of payment to the Junior
Subordinated Debentures (other than (a) dividends or distributions in shares of,
or options, warrants or rights to subscribe for or purchase shares of, common
stock of the Corporation, (b) any declaration of a dividend in connection with
the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto, (c) as a result of a reclassification of the
Corporation's capital stock or the exchange or conversion of one class or series
of the Corporation's capital stock for another class or series of the
Corporation's capital stock, (d) the purchase of fractional interests in shares
of the Corporation's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
and (e) purchases of common stock related to the issuance of common stock or
rights under any of the Corporation's benefit or compensation plans for its
directors, officers or employees or any of the Corporation's dividend
reinvestment plans) if at such time (1) there shall have occurred any event of
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which the Corporation has actual knowledge that (a) is, or with the giving of
notice or the lapse of time, or both, would be, a Debenture Event of Default and
(b) in respect of which the Corporation shall not have taken reasonable steps to
cure, (2) if such Junior Subordinated Debentures are held by the Trust, the
Corporation shall be in default with respect to its payment of any obligations
under the Guarantee or (3) the Corporation shall have given notice of its
election to exercise its right to commence an Extension Period as provided in
the Indenture and shall not have rescinded such notice, and such Extension
Period, or any extension thereof, shall have commenced and be continuing.
So long as the Trust Securities remain outstanding, the Corporation
also will covenant (i) to maintain 100% direct or indirect ownership of the
Common Securities, provided, however, that any permitted successor of the
Corporation under the Indenture may succeed to the Corporation's ownership of
such Common Securities, (ii) to use commercially reasonable efforts to cause the
Trust (a) to remain a business trust, except in connection with the distribution
of Junior Subordinated Debentures to the holders of Trust Securities in
liquidation of the Trust, the prepayment of all of the Trust Securities of the
Trust, or certain mergers, consolidations or amalgamations, each as permitted by
the Trust Agreement, and (b) to otherwise continue to be classified as a grantor
trust for United States federal income tax purposes (iii) to use its reasonable
efforts to cause each holder of Trust Securities to be treated as owning an
undivided beneficial interest in the Junior Subordinated Debentures and (iv) not
to cause, as sponsor of the Trust, or to permit, as Holder of the Common
Securities, the dissolution, winding-up or termination of the Trust, except as
provided in the Trust Agreement.
Modification of Indenture. From time to time the Corporation and the
Debenture Trustee may, without the consent of the holders of Junior Subordinated
Debentures, amend, waive or supplement the Indenture for specified purposes,
including, among other things, curing ambiguities, defects or inconsistencies or
enabling the Corporation and the Trust to conduct an Exchange Offer as
contemplated by the Registration Rights Agreement, provided that any such action
does not materially adversely affect the interest of the holders of Junior
Subordinated Debentures, and qualifying, or maintaining the qualification of,
the Indenture under the Trust Indenture Act. The Indenture contains provisions
permitting the Corporation and the Debenture Trustee, with the consent of the
holders of a majority in principal amount of Junior Subordinated Debentures, to
modify the Indenture in a manner affecting the rights of the holders of Junior
Subordinated Debentures; provided that no such modification may, without the
consent of the holders of each outstanding Junior Subordinated Debenture so
affected, (i) change the Stated Maturity Date, or reduce the principal amount of
the Junior Subordinated Debentures or reduce the amount payable on redemption
thereof or reduce the rate or extend the time of payment of interest thereon
except pursuant to the Corporation's right under the Indenture to defer the
payment of interest as provided therein (see "--Option to Extend Interest
Payment Date") or make the principal of, or interest or premium on, the Junior
Subordinated Debentures payable in any coin or currency other than that provided
in the Junior Subordinated Debentures, or impair or affect the right of any
holder of Junior Subordinated Debentures to institute suit for the payment
thereof, or (ii) reduce the percentage of principal amount of Junior
Subordinated Debentures, the holders of which are required to consent to any
such modification of the Indenture.
Debenture Events of Default. The Indenture provides that any one or
more of the following described events with respect to the Junior Subordinated
Debentures constitutes a "Debenture Event of Default" (whatever the reason for
such Debenture Event of Default and whether it shall be voluntary or involuntary
or be effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body):
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(i) failure for 30 days to pay any interest (including
Compounded Interest and Additional Sums, if any) or Liquidated Damages,
if any, on the Junior Subordinated Debentures or any Other Debentures,
when due (subject to the deferral of any due date in the case of an
Extension Period in respect of the Junior Subordinated Debentures or
Other Debentures, as the case may be); or
(ii) failure to pay any principal or premium, if any, on the
Junior Subordinated Debentures or any Other Debentures when due whether
at maturity, upon prepayment, by declaration of acceleration of
maturity or otherwise; or
(iii) failure to observe or perform any other covenants
contained in the Indenture for 90 days after written notice to the
Corporation from the Debenture Trustee or the holders of at least 25%
in aggregate outstanding principal amount of Junior Subordinated
Debentures; or
(iv) certain events in bankruptcy, insolvency or
reorganization of the Corporation.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures have, subject to certain exceptions, the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee. The Debenture Trustee or the holders
of not less than 25% in aggregate outstanding principal amount of the Junior
Subordinated Debentures may declare the principal due and payable immediately
upon a Debenture Event of Default. The holders of a majority in aggregate
outstanding principal amount of the Junior Subordinated Debentures may annul
such declaration and waive the default if the default (other than the
non-payment of the principal of the Junior Subordinated Debentures which has
become due solely by such acceleration) has been cured and a sum sufficient to
pay all matured installments of interest and principal due otherwise than by
acceleration has been deposited with the Debenture Trustee.
The holders of a majority in aggregate outstanding principal amount of
the Junior Subordinated Debentures affected thereby may, on behalf of the
holders of all the Junior Subordinated Debentures, waive any past default,
except a default in the payment of principal of (or premium, if any) on or
interest (unless such default has been cured and a sum sufficient to pay all
matured installments of interest (and premium, if any) and principal due
otherwise than by acceleration has been deposited with the Debenture Trustee),
or a default in respect of a covenant or provision which under the Indenture
cannot be modified or amended without the consent of the holder of each
outstanding Junior Subordinated Debenture.
The Indenture requires the annual filing by the Corporation with the
Debenture Trustee of a certificate as to the absence of certain defaults under
the Indenture.
The Indenture provides that the Debenture Trustee may withhold notice
of a Debenture Event of Default from the holders of the Exchange Junior
Subordinated Debentures if the Debenture Trustee considers it in the interest of
such holders to do so.
Enforcement of Certain Rights by Holders of Exchange Capital
Securities. If a Debenture Event of Default shall have occurred and be
continuing and shall be attributable to the failure of the Corporation to pay
the principal of (or premium, if any), or interest (including Compounded
Interest and Additional Sums, if any) or Liquidated Damages, if any, on the
Exchange Junior Subordinated Debentures on the due date, a holder of Exchange
Capital Securities may institute a Direct Action.
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The Corporation may not amend the Indenture to remove the foregoing right to
bring a Direct Action without the prior written consent of the holders of all of
the Exchange Capital Securities. Notwithstanding any payments made to a holder
of Exchange Capital Securities by the Corporation in connection with a Direct
Action, the Corporation shall remain obligated to pay the principal of (or
premium, if any) or interest (including Compounded Interest and Additional Sums,
if any) or Liquidated Damages, if any, on the Exchange Junior Subordinated
Debentures, and the Corporation shall be subrogated to the rights of the holder
of such Exchange Capital Securities with respect to payments on the Exchange
Capital Securities to the extent of any payments made by the Corporation to such
holder in any Direct Action.
The holders of the Exchange Capital Securities will not be able to
exercise directly any remedies other than those set forth in the preceding
paragraph, available to the holders of the Exchange Junior Subordinated
Debentures unless there shall have been an Event of Default under the Trust
Agreement. See "--Description of Exchange Capital Securities--Events of Default;
Notice."
Consolidation, Merger, Sale of Assets and Other Transactions. The
Indenture provides that the Corporation shall not consolidate with or merge into
any other Person or convey, transfer or lease its properties as an entirety or
substantially as an entirety to any Person, and no Person shall consolidate with
or merge into the Corporation or convey, transfer or lease its properties as an
entirety or substantially as an entirety to the Corporation, unless: (i) in case
the Corporation consolidates with or merges into another Person or conveys or
transfers its properties as an entirety or substantially as an entirety to any
Person, the successor Person is organized under the laws of the United States or
any state or the District of Columbia, and such successor Person expressly
assumes the Corporation's obligations on the Junior Subordinated Debentures;
(ii) immediately after giving effect thereto, no Debenture Event of Default, and
no event which, after notice or lapse of time or both, would become a Debenture
Event of Default, shall have occurred and be continuing; and (iii) certain other
conditions as prescribed in the Indenture are met.
The general provisions of the Indenture do not afford holders of the
Exchange Junior Subordinated Debentures protection in the event of a highly
leveraged or other transaction involving the Corporation that may adversely
affect holders of the Exchange Junior Subordinated Debentures.
Satisfaction and Discharge. The Indenture provides that when, among
other things, all Exchange Junior Subordinated Debentures not previously
delivered to the Debenture Trustee for cancellation (i) have become due and
payable or (ii) will become due and payable at maturity or upon prepayment
within one year, and the Corporation deposits or causes to be deposited with the
Debenture Trustee funds, in trust, for the purpose and in an amount sufficient
to pay and discharge the entire indebtedness on the Exchange Junior Subordinated
Debentures not previously delivered to the Debenture Trustee for cancellation,
for the principal (and premium, if any) and interest to the date of the deposit
or to the Stated Maturity Date, as the case may be, then the Indenture will
cease to be of further effect (except as to the Corporation's obligations to pay
all other sums due pursuant to the Indenture and to provide the officers'
certificates and opinions of counsel described therein), and the Corporation
will be deemed to have satisfied and discharged the Indenture.
Subordination. In the Indenture, the Corporation has covenanted and
agreed that any Junior Subordinated Debentures issued thereunder will rank
subordinate and junior in right of payment to all Senior Indebtedness to the
extent provided in the Indenture. Upon any payment or distribution of assets to
creditors upon any liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in connection with any
insolvency or bankruptcy proceeding of the Corporation, the
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holders of all Senior Indebtedness will first be entitled to receive payment in
full of such Senior Indebtedness before the holders of Junior Subordinated
Debentures will be entitled to receive or retain any payment in respect thereof.
In the event of the acceleration of the maturity of the Junior
Subordinated Debentures, the holders of all Senior Indebtedness outstanding at
the time of such acceleration will first be entitled to receive payment in full
of such Senior Indebtedness before the holders of the Junior Subordinated
Debentures will be entitled to receive or retain any payment in respect of the
Junior Subordinated Debentures.
No payments on account of principal (or premium, if any) or interest in
respect of the Junior Subordinated Debentures may be made if there shall have
occurred and be continuing a default in any payment with respect to Senior
Indebtedness, or an event of default with respect to any Senior Indebtedness
resulting in the acceleration of the maturity thereof, or if any judicial
proceeding shall be pending with respect to any such default.
"Indebtedness" shall mean: (i) every obligation of the Corporation for
money borrowed; (ii) every obligation of the Corporation 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 Corporation with respect to letters of
credit, banker's acceptances or similar facilities issued for the account of the
Corporation; (iv) every obligation of the Corporation 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 Corporation; (vi) all indebtedness of the
Corporation, whether incurred on or prior to the date of the Indenture or
thereafter incurred, for claims in respect of derivative products, including
interest rate, foreign exchange rate and commodity forward contracts, options
and swaps and similar arrangements; and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, the Corporation has
guaranteed or is responsible or liable for, directly or indirectly, as obligor
or otherwise.
"Indebtedness Ranking on a Parity with the Junior Subordinated
Debentures" shall mean (i) Indebtedness, whether outstanding on the date of
execution of the Indenture or thereafter created, assumed or incurred, to the
extent such indebtedness specifically by its terms ranks pari passu with and not
prior to the Junior Subordinated Debentures in the right of payment upon the
happening of the dissolution or winding-up or liquidation or reorganization of
the Corporation and (ii) all other debt securities, and guarantees in respect of
those debt securities, issued to any other trust, or a trustee of such trust,
partnership or other entity affiliated with the Corporation that is a financing
vehicle of the Corporation (a "financing entity") in connection with the
issuance by such financing entity of equity securities or other securities
guaranteed by the Corporation pursuant to an instrument that ranks pari passu
with or junior in right of payment to the Guarantee. The securing of any
Indebtedness otherwise constituting Indebtedness Ranking on a Parity with the
Junior Subordinated Debentures shall not be deemed to prevent such Indebtedness
from constituting Indebtedness Ranking on a Parity with the Junior Subordinated
Debentures.
"Indebtedness Ranking Junior to the Junior Subordinated Debentures"
shall mean any Indebtedness, whether outstanding on the date of execution of the
Indenture or thereafter created, assumed or incurred, to the extent such
indebtedness by its terms ranks junior to and not pari passu with or prior to
the Junior Subordinated Debentures (and any other Indebtedness Ranking on a
Parity with the Junior Subordinated Debentures) in right of payment upon the
happening of the dissolution
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or winding up or liquidation or reorganization of the Corporation. The securing
of any Indebtedness otherwise constituting Indebtedness Ranking Junior to the
Junior Subordinated Debentures shall not be deemed to prevent such Indebtedness
from constituting Indebtedness Ranking Junior to the Junior Subordinated
Debentures.
"Senior Indebtedness" shall mean all Indebtedness, whether outstanding
on the date of execution of the Indenture or thereafter created, assumed or
incurred, except Indebtedness Ranking on a Parity with the Junior Subordinated
Debentures or Indebtedness Ranking Junior to the Junior Subordinated Debentures,
and any deferrals, renewals or extensions of such Senior Indebtedness.
Almost all of the operating assets of the Corporation and its
consolidated subsidiaries are owned by such subsidiaries. The Corporation is a
legal entity separate and distinct from the Banks and its other subsidiaries.
Holders of Exchange Junior Subordinated Debentures should look only to the
Corporation for payments on the Exchange Junior Subordinated Debentures. The
principal sources of the Corporation's income are dividends and interest from
the Banks and its other subsidiaries, and there are various limitations on the
Banks to pay such dividends, as discussed below. The Banks are also subject to
certain restrictions on the transfer of funds by each of such depository
institutions to the Corporation and certain other affiliates, in the form of
loans, other extensions of credit, investments or purchases of assets. Transfers
by any Bank to the Corporation or any single affiliate are generally limited in
amount as to the Corporation and as to each of such other affiliates to 10% of
such Bank's capital and surplus and transfers to all affiliates are limited to
an aggregate of 20% of such Bank's capital and surplus. Furthermore, such loans
and extensions of credit are subject to various collateral requirements.
Because the Corporation is a holding company, the Corporation's
operations are conducted by its subsidiaries, including the Banks, which are
subject to significant federal and state regulation. As a result, the
Corporation's ability to receive dividends and loans from its subsidiaries is
restricted. As of December 31, 1996, the Banks were able to declare dividends to
the Corporation in 1997, without regulatory approval, of approximately $4.7
million. In addition, in February 1996, as part of its plan to capitalize the
Corporation's newly formed subsidiary bank, First Massachusetts Bank, N.A., at a
"well-capitalized" level for regulatory capital purposes, the Corporation
redeployed accumulated capital of $45.6 million in the form of special dividends
from certain of the Banks. Because the amounts of the special dividends exceeded
applicable regulatory limitations, the Corporation obtained the necessary
regulatory approvals to effect such redeployment. Payment of the special
dividends has significantly restricted the dividend paying capacity of the
Banks. Accordingly, payment of any dividends to the Corporation by certain of
the Banks currently requires regulatory approval on account of the
aforementioned special dividends, and payments of dividends by the Banks in the
future will require their generation of sufficient future earnings. Further, the
right of the Corporation to participate in any distribution of assets of any
subsidiary upon such subsidiary's liquidation or reorganization or otherwise
(and thus the ability of holders of the Capital Securities to benefit indirectly
from such distribution) is subject to the prior claims of creditors of such
subsidiary (including depositors in the case of the Banks), except to the extent
that the Corporation may itself be recognized as a creditor of that subsidiary.
Accordingly, the Exchange Junior Subordinated Debentures effectively will be
subordinated to all existing and future liabilities of the Corporation's
subsidiaries (including deposit liabilities of the Banks), and holders of
Exchange Junior Subordinated Debentures should look only to the assets of the
Corporation for payments on the Exchange Junior Subordinated Debentures.
The Indenture does not limit the amount of secured or unsecured debt,
including Senior Indebtedness, that may be incurred by the Corporation or any of
its subsidiaries. At December 31,
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1996, the Corporation had $13.0 million of Senior Indebtedness outstanding, and
the Corporation's subsidiaries had total liabilities (excluding liabilities owed
to the Corporation) of $2.4 billion. See "--Subordination." The Corporation
expects from time to time that it will incur additional indebtedness
constituting Senior Indebtedness and that its subsidiaries will incur additional
liabilities.
Restrictions on Transfer. The Exchange Junior Subordinated Debentures
will be issued, and may be transferred, only in blocks having an aggregate
principal amount of not less than $100,000 and multiples of $1,000 in excess
thereof. Any such transfer of Exchange 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 Exchange Junior Subordinated Debentures for any
purpose, including but not limited to the receipt of payments on such Exchange
Junior Subordinated Debentures, and such transferee shall be deemed to have no
interest whatsoever in such Exchange Junior Subordinated Debentures.
Information Concerning the Debenture Trustee. Following the Exchange
Offer and the qualification of the Indenture under the Trust Indenture Act, the
Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to the foregoing, the Debenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of Exchange Junior Subordinated Debentures, unless offered
reasonable indemnity by such holder against the costs, expenses and liabilities
which might be incurred thereby. The Debenture Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Debenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.
Governing Law. The Indenture and the Exchange Junior Subordinated
Debentures will be governed by and construed in accordance with the laws of the
State of New York.
Description of Exchange Guarantee
The Exchange Guarantee will be executed and delivered by the
Corporation concurrently with the issuance by the Trust of the Exchange Capital
Securities for the benefit of the holders from time to time of the Exchange
Capital Securities. The terms of the Exchange Guarantee are identical in all
material respects to the terms of the Original Guarantee. The First National
Bank of Chicago will act as Guarantee Trustee under the Exchange Guarantee. The
Exchange Guarantee has been qualified under the Trust Indenture Act. This
summary of certain provisions of the Exchange 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 Exchange Guarantee, including the definitions therein
of certain terms, and those made part of the Guarantee by the Trust Indenture
Act. The Guarantee Trustee will hold the Exchange Guarantee for the benefit of
the holders of the Exchange Capital Securities.
Status of Original Guarantee. If not all the Original Capital
Securities are exchanged for Exchange Capital Securities in the Exchange Offer,
the Original Guarantee will not terminate, but will continue to guarantee the
obligations of the Corporation for the benefit of the holders of the Original
Capital Securities. The Original Guarantee will terminate upon full payment of
the applicable Redemption Price of the Original Capital Securities, upon full
payment of the Liquidation Amount payable upon liquidation of the Trust or upon
distribution of Original Junior Subordinated Debentures to the holders of the
Original Capital Securities. The Original Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of the Original Capital Securities
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must restore payment of any sums paid under the Original Capital Securities or
the Original Guarantee.
General. The Corporation will irrevocably agree to pay in full on a
subordinated basis, to the extent set forth herein, the Guarantee Payments (as
defined below) to the holders of the Exchange Capital Securities, as and when
due, regardless of any defense, right of set-off or counterclaim that the Trust
may have or assert other than the defense of payment. The following payments
with respect to the Exchange Capital Securities, to the extent not paid by or on
behalf of the Trust (the "Guarantee Payments"), will be subject to the Exchange
Guarantee: (i) any accumulated and unpaid Distributions required to be paid on
the Exchange Capital Securities, to the extent that the Trust has funds legally
available therefor at such time; (ii) the applicable Redemption Price with
respect to the Exchange Capital Securities called for redemption, to the extent
that the Trust has funds legally available therefor at such time; and (iii) upon
a voluntary or involuntary dissolution, winding-up or liquidation of the Trust
(other than in connection with the distribution of the Exchange Junior
Subordinated Debentures to holders of the Exchange Capital Securities or the
redemption of all Exchange Capital Securities), the lesser of (a) the
Liquidation Distribution, to the extent that the Trust has funds legally
available therefor at the time, and (b) the amount of assets of the Trust
remaining available for distribution to holders of Exchange Capital Securities
after satisfaction of liabilities to creditors of the Trust as required by
applicable law. The Corporation's obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Corporation to the
holders of the Exchange Capital Securities or by causing the Trust to pay such
amounts to such holders.
The Corporation will, through the Exchange Guarantee, the Trust
Agreement, the Exchange Junior Subordinated Debentures and the Indenture, taken
together, fully, irrevocably and unconditionally guarantee all of the Trust's
obligations under the Exchange Capital Securities. No single document standing
alone or operating in conjunction with fewer than all of the other documents
constitutes such guarantee. It is only the combined operation of these documents
that has the effect of providing a full, irrevocable and unconditional guarantee
of the Trust's obligations under the Exchange Capital Securities. See
"Relationship Among the Exchange Capital Securities, the Exchange Junior
Subordinated Debentures and the Exchange Guarantee."
Status of the Exchange Guarantee. The Exchange Guarantee will
constitute an unsecured obligation of the Corporation and will rank subordinate
and junior in right of payment to all Senior Indebtedness in the same manner as
the Exchange Junior Subordinated Debentures. See "Description of Exchange Junior
Subordinated Debentures--Subordination." Because the Corporation is a holding
company, the right of the Corporation to participate in any distribution of
assets of any subsidiary upon such subsidiary's liquidation or reorganization or
otherwise is subject to the prior claims of creditors of such subsidiary
(including depositors in the case of the Banks), except to the extent the
Corporation may itself be recognized as a creditor of such subsidiary.
Accordingly, the Corporation's obligations under the Exchange Guarantee
effectively will be subordinated to all existing and future liabilities
(including deposit liabilities of the Banks) of the Corporation's present and
future subsidiaries. Claimants should look only to the assets of the Corporation
for payments under the Exchange Guarantee. See "Description of Exchange Junior
Subordinated Debentures--General." The Exchange Guarantee does not limit the
amount of secured or unsecured debt, including Senior Indebtedness, that may be
incurred by the Corporation or any of its subsidiaries. The Corporation expects
from time to time that it will incur additional indebtedness constituting Senior
Indebtedness and that its subsidiaries will incur additional liabilities.
The Exchange Guarantee will rank pari passu with all Other Guarantees
issued by the Corporation with respect to preferred beneficial interests (if
any) issued by Other Trusts. The
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Exchange Guarantee will constitute a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Corporation to enforce its rights under the Exchange Guarantee without first
instituting a legal proceeding against any other person or entity). The Exchange
Guarantee will be held for the benefit of the holders of the Exchange Capital
Securities. The Exchange Guarantee will not be discharged except by payment of
the Guarantee Payments in full to the extent not paid by the Trust or upon
distribution to the holders of the Exchange Capital Securities of the Exchange
Junior Subordinated Debentures.
Events of Default. An event of default under the Exchange Guarantee
will occur upon the failure of the Corporation to perform any of its payment or
other obligations thereunder, provided, however, that except with respect to a
default in respect of any Guarantee Payment, the Corporation shall have received
notice of default and shall not have cured such default within 60 days after
receipt of such notice.
The holders of a majority in Liquidation Amount of the Exchange Capital
Securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of the Exchange Guarantee or to direct the exercise of any trust or
power conferred upon the Guarantee Trustee under the Exchange Guarantee. If the
Guarantee Trustee fails to enforce the Exchange Guarantee, any holder of the
Exchange Capital Securities may institute a legal proceeding directly against
the Corporation to enforce its rights under the Exchange Guarantee without first
instituting a legal proceeding against the Trust, the Guarantee Trustee or any
other person or entity.
The Corporation, as guarantor, will be required to file annually with
the Guarantee Trustee a certificate as to whether or not the Corporation is in
compliance with all the conditions and covenants applicable to it under the
Exchange Guarantee.
Amendments and Assignment. Except with respect to any changes that do
not materially adversely affect the rights of holders of the Exchange Capital
Securities (in which case no consent will be required), the Exchange Guarantee
may not be amended without the prior approval of the holders of a majority of
the Liquidation Amount of such outstanding Exchange Capital Securities. The
manner of obtaining any such approval will be as set forth under "--Description
of Exchange Capital Securities--Voting Rights; Amendment of the Trust
Agreement." All guarantees and agreements contained in the Exchange Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Corporation and shall inure to the benefit of the holders of the Exchange
Capital Securities then outstanding.
Termination of the Exchange Guarantee. The Exchange Guarantee will
terminate and be of no further force and effect upon full payment of the
applicable Redemption Price of the Exchange Capital Securities, upon full
payment of the Liquidation Amount payable upon liquidation of the Trust or upon
distribution of Exchange Junior Subordinated Debentures to the holders of the
Exchange Capital Securities. The Exchange Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of the Exchange Capital Securities must restore payment of any sums paid under
the Exchange Capital Securities or the Exchange Guarantee.
Information Concerning the Guarantee Trustee. The Guarantee Trustee,
other than during the occurrence and continuance of a default by the Corporation
in performance of the Exchange Guarantee, will undertake to perform only such
duties as are specifically set forth in the Exchange Guarantee and, in case a
default with respect to the Exchange Guarantee has occurred, must exercise the
same degree of care and skill as a prudent person would exercise or use in the
conduct of his or
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her own affairs. Subject to this provision, the Guarantee Trustee will be under
no obligation to exercise any of the powers vested in it by the Exchange
Guarantee at the request of any holder of the Exchange Capital Securities unless
it is offered reasonable indemnity against the costs, expenses and liabilities
that might be incurred thereby.
Governing Law. The Exchange Guarantee will be governed by and construed
in accordance with the laws of the State of New York.
DESCRIPTION OF ORIGINAL SECURITIES
The terms of the Original Securities are identical in all materials
respects to the Exchange Securities, except that (i) the Original Securities
have not been registered under the Securities Act, are subject to certain
restrictions on transfer and are entitled to certain rights under the applicable
Registration Rights Agreement (which rights will terminate upon consummation of
the Exchange Offer, except under limited circumstances), (ii) the Exchange
Capital Securities will not provide for any increase in the Distribution rate
thereon and (iii) the Exchange Junior Subordinated Debentures will not provide
for any liquidated damages thereon. The Original Securities provide that, if a
registration statement relating to the Exchange Offer has not been filed by
September 27, 1997 and been declared effective by October 27, 1997, then
liquidated damages will accrue at the rate of 0.25% per annum on the principal
amount of the Original Junior Subordinated Debentures and Distributions will
accrue at the rate of 0.25% per annum on the Liquidation Amount of the Original
Capital Securities, for the period from the occurrence of such event until such
time as such registration statement has been filed or declared effective, as the
case may be. In addition, the Original Capital Securities provide that, if the
Trust has not exchanged Exchange Capital Securities for all Original Capital
Securities validly tendered by the 45th day after the date on which the
registration statement is declared effective, the Distribution rate borne by the
Original Capital Securities will increase by .25% per annum for the period from
the occurrence of such event until such time as the Exchange Offer has been
consummated. The Exchange Securities are not, and upon consummation of the
Exchange Offer the Original Securities will not be, entitled to any such
additional interest or Distributions. Accordingly, holders of Original Capital
Securities should review the information set forth under "Risk
Factors--Consequences of a Failure to Exchange Original Capital Securities" and
"Description of Exchange Securities."
RELATIONSHIP AMONG THE EXCHANGE CAPITAL SECURITIES, THE EXCHANGE
JUNIOR SUBORDINATED DEBENTURES AND THE EXCHANGE GUARANTEE
Full and Unconditional Guarantee
Payments of Distributions and other amounts due on the Exchange Capital
Securities (to the extent the Trust has funds legally available for the payment
of such Distributions) will be irrevocably guaranteed by the Corporation as and
to the extent set forth under "Description of Exchange Securities--Description
of Exchange Guarantee." Taken together, the Corporation's obligations under the
Exchange Junior Subordinated Debentures, the Indenture, the Trust Agreement and
the Exchange Guarantee provide, in the aggregate, a full, irrevocable and
unconditional guarantee of payments of Distributions and other amounts due on
the Exchange Capital Securities. No single document standing alone or operating
in conjunction with fewer than all of the other documents constitutes such
guarantee. It is only the combined operation of these documents that has the
effect of providing a full, irrevocable and unconditional guarantee of the
Trust's obligations under the Exchange Capital Securities. If and to the extent
that the Corporation does not make the required payments on the Exchange Junior
Subordinated Debentures, the Trust will not have sufficient funds to make the
related
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payments, including Distributions, on the Exchange Capital Securities. The
Exchange Guarantee will not cover any such payment when the Trust does not have
sufficient funds legally available therefor. In such event, the remedy of a
holder of Exchange Capital Securities is to institute a Direct Action. The
obligations of the Corporation under the Exchange Guarantee will be subordinate
and junior in right of payment to all Senior Indebtedness.
Sufficiency of Payments
As long as payments of interest and other payments are made when due on
the Exchange Junior Subordinated Debentures, such payments will be sufficient to
cover Distributions and other payments due on the Exchange Capital Securities,
primarily because: (i) the aggregate principal amount or Prepayment Price of the
Junior Subordinated Debentures will be equal to the sum of the aggregate
Liquidation Amount or Redemption Price, as applicable, of the Trust Securities;
(ii) the interest rate and interest and other payment dates on the Junior
Subordinated Debentures will match the Distribution rate and Distribution and
other payment rates for the Trust Securities; (iii) the Corporation, as Sponsor,
shall pay for all and any costs, expenses and liabilities of the Trust except
the Trust's obligations to holders of Trust Securities; and (iv) the Trust
Agreement further provides that the Trust is not authorized to engage in any
activity that is not consistent with the limited purposes thereof.
Enforcement Rights of Holders of Exchange Capital Securities
A holder of any Exchange Capital Security may institute a legal
proceeding directly against the Corporation to enforce its rights under the
Exchange Guarantee without first instituting a legal proceeding against the
Guarantee Trustee, the Trust or any other person or entity.
A default or event of default under any Senior Indebtedness would not
constitute a default or Event of Default under the Trust Agreement. However, in
the event of payment defaults under, or acceleration of, Senior Indebtedness,
the subordination provisions of the Indenture provide that no payments may be
made in respect of the Exchange Junior Subordinated Debentures until such Senior
Indebtedness has been paid in full or any payment default thereunder has been
cured or waived. Failure to make required payments on Exchange Junior
Subordinated Debentures would constitute an Event of Default under the Trust
Agreement.
Limited Purpose of the Trust
The Exchange Capital Securities will represent beneficial interests in
the Trust, and the Trust exists for the sole purpose of issuing and selling the
Trust Securities, using the proceeds from the sale of the Trust Securities to
acquire the Exchange Junior Subordinated Debentures, exchanging the Exchange
Capital Securities and the Original Junior Subordinated Debentures in the
Exchange Offer, and engaging in only those other activities necessary, advisable
or incidental thereto.
Rights Upon Termination
Unless the Exchange Junior Subordinated Debentures are distributed to
holders of the Exchange Capital Securities, upon any voluntary or involuntary
termination, winding-up or liquidation of the Trust, after satisfaction of the
liabilities of creditors of the Trust as required by applicable law, the holders
of the Exchange Capital Securities will be entitled to receive, out of assets
held by the Trust, the Liquidation Distribution in cash. See "Description of
Exchange Securities--Description of Exchange Capital Securities--Liquidation of
the Trust and Distribution of Exchange Junior
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Subordinated Debentures." Upon any voluntary or involuntary liquidation or
bankruptcy of the Corporation, the Property Trustee, as holder of the Exchange
Junior Subordinated Debentures, would be a subordinated creditor of the
Corporation, subordinated in right of payment to all Senior Indebtedness as set
forth in the Indenture, but entitled to receive payment in full of principal
(and premium, if any) and interest, before any stockholders of the Corporation
receive payments or distributions.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
General
The following is a summary of certain of the material United States
federal income tax consequences associated with the exchange of Original Capital
Securities for Exchange Capital Securities and with the ownership and
disposition of Capital Securities held as capital assets by a holder who
purchased Original Capital Securities upon initial issuance. It does not purport
to deal with all aspects of U.S. federal income taxation that might be relevant
to particular holders in light of their personal investment circumstances or
status, nor does it discuss the U.S. federal income tax consequences to certain
types of holders subject to special treatment under the U.S. federal income tax
laws, such as banks, thrifts, real estate investment trusts, regulated
investment companies, insurance companies, dealers in securities or currencies,
tax-exempt investors, United States Alien Holders (as defined herein) engaged in
a U.S. trade or business or persons that will hold the Capital Securities as a
position in a "straddle," as part of a "synthetic security" or "hedge," as part
of a "conversion transaction" or other integrated investment, or as other than a
capital asset. This summary also does not address the tax consequences to
persons that have a functional currency other than the U.S. dollar or the tax
consequences to shareholders, partners or beneficiaries of a holder of Capital
Securities. Further, it does not include any description of any alternative
minimum tax consequences or the tax laws of any state or local government or of
any foreign government that may be applicable to the Capital Securities. This
summary is based on the Internal Revenue Code of 1986, as amended (the "Code"),
Treasury regulations thereunder and the administrative and judicial
interpretations thereof, as of the date hereof, all of which are subject to
change, possibly on a retroactive basis. Brown & Wood LLP ("Tax Counsel") has
reviewed this summary and is of the opinion that, to the extent that it
constitutes matters of law or purports to describe certain provisions of the
U.S. federal income tax laws, it is a correct summary in all material respects
of the matters discussed herein.
Exchange of Capital Securities
The exchange of Original Capital Securities for Exchange Capital
Securities should not be a taxable event to holders for United States federal
income tax purposes. The exchange of Original Capital Securities for Exchange
Capital Securities pursuant to the Exchange Offer should not be treated as an
"exchange" for United States federal income tax purposes because the Exchange
Capital Securities should not be considered to differ materially in kind or
extent from the Original Capital Securities and because the exchange will occur
by operation of the terms of the Original Capital Securities. Accordingly, the
Exchange Capital Securities should have the same issue price as the Original
Capital Securities, and a holder should have the same adjusted tax basis and
holding period in the Exchange Capital Securities immediately after the exchange
as the holder had in the Original Capital Securities immediately before the
exchange.
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Classification of the Junior Subordinated Debentures
The Corporation intends to take the position that the Junior
Subordinated Debentures will be classified for United States federal income tax
purposes as indebtedness of the Corporation. The Corporation, the Trust and the
holders of the Capital Securities (by acceptance of a beneficial interest in a
Capital Security) will agree to treat the Junior Subordinated Debentures as
indebtedness of the Corporation and the Capital Securities as evidence of a
beneficial ownership interest in the Junior Subordinated Debentures for all
United States federal income tax purposes. No assurance can be given, however,
that such position will not be challenged by the Internal Revenue Service (the
"IRS") or, if challenged, that such a challenge will not be successful. The
remainder of this discussion assumes that the Junior Subordinated Debentures
will be classified as indebtedness of the Corporation for United States federal
income tax purposes.
Classification of the Trust
In connection with the issuance of the Capital Securities, Tax Counsel
is of the opinion generally to the effect that, under then-current law and
assuming full compliance with the terms of the Trust Agreement and the Indenture
(and certain other documents), and based on certain facts and assumptions
contained in such opinion, the Trust will be classified for United States
federal income tax purposes as a grantor trust and not as an association taxable
as a corporation. Accordingly, for United States federal income tax purposes,
each holder of Capital Securities generally will be considered the owner of an
undivided interest in the Junior Subordinated Debentures, and each holder will
be required to include in its gross income any interest (or OID accrued) with
respect to its allocable share of those Junior Subordinated Debentures.
An opinion of Tax Counsel is not binding on the IRS or the courts. No
rulings have been or are expected to be sought from the IRS with respect to any
of the transactions described herein and no assurance can be given that the IRS
will not take contrary positions. Moreover, no assurance can be given that the
opinion expressed herein will not be challenged by the IRS or, if challenged,
that such a challenge would not be successful.
Interest Income and Original Issue Discount
Under recently issued Treasury regulations (the "Treasury Regulations")
applicable to debt instruments issued on or after August 13, 1996, a "remote"
contingency that stated interest will not be timely paid will be ignored in
determining whether a debt instrument is issued with OID. The Corporation
believes that the likelihood of its exercising its option to defer payments of
interest is "remote" since exercising that option would, among other things,
prevent the Corporation from declaring dividends on any class of its equity
securities. Accordingly, the Corporation intends to take the position that the
Junior Subordinated Debentures will not be considered to be issued with OID and,
accordingly, stated interest on the Junior Subordinated Debentures generally
will be taxable to a holder as ordinary income at the time it is paid or accrued
in accordance with such holder's method of tax accounting.
Under the Treasury Regulations, if the Corporation were to exercise its
option to defer payments of interest, the Junior Subordinated Debentures would
at that time be treated as issued with OID, and all stated interest on the
Junior Subordinated Debentures would thereafter be treated as OID as long as the
Junior Subordinated Debentures remain outstanding. In such event, all of a
holder's taxable interest income with respect to the Junior Subordinated
Debentures would thereafter be accounted for on an economic accrual basis
regardless of such holder's method of tax accounting, and
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actual distributions of stated interest would not be reported as taxable income.
Consequently, a holder of Capital Securities would be required to include in
gross income OID even though the Corporation would not make actual cash payments
during an Extension Period. Moreover, under the Treasury Regulations, if the
option to defer the payment of interest was determined not to be "remote," the
Junior Subordinated Debentures would be treated as having been originally issued
with OID. In such event, all of a holder's taxable interest income with respect
to the Junior Subordinated Debentures would be accounted for on an economic
accrual basis regardless of such holder's method of tax accounting, and actual
distributions of stated interest would not be reported as taxable income.
The Treasury Regulations have not yet been addressed in any rulings or
other interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation described herein.
Because income on the Capital Securities will constitute interest or
OID, corporate holders of the Capital Securities will not be entitled to a
dividends-received deduction with respect to any income recognized with respect
to the Capital Securities.
Receipt of Junior Subordinated Debentures or Cash Upon Liquidation of the Trust
The Corporation will have the right at any time to liquidate the Trust
and cause the Junior Subordinated Debentures to be distributed to the holders of
the Trust Securities. Under current law, such a distribution, for United States
federal income tax purposes, would be treated as a nontaxable event to each
holder, and each holder would receive an aggregate tax basis in the Junior
Subordinated Debentures equal to such holder's aggregate tax basis in its
Capital Securities. A holder's holding period in the Junior Subordinated
Debentures so received in liquidation of the Trust would include the period
during which the Capital Securities were held by such holder. If, however, the
Trust were characterized for United States federal income tax purposes as an
association taxable as a corporation at the time of its dissolution, the
distribution of the Junior Subordinated Debentures may constitute a taxable
event to holders of Capital Securities and a holder's holding period in Junior
Subordinated Debentures would begin on the date such Junior Subordinated
Debentures were received.
Under certain circumstances described herein (see "Description of
Exchange Securities--Description of Exchange Capital Securities"), the Junior
Subordinated Debentures may be redeemed for cash and the proceeds of such
redemption distributed to holders in redemption of their Capital Securities.
Under current law, such a redemption would, for United States federal income tax
purposes, constitute a taxable disposition of the redeemed Capital Securities,
and a holder could recognize gain or loss as if it sold such redeemed Capital
Securities for cash. See "--s
Sales of Capital Securities."
Sales of Capital Securities
A holder that sells Capital Securities (including a redemption of the
Capital Securities either on the Stated Maturity Date or upon an optional
redemption of the Junior Subordinated Debentures by the Corporation) will
recognize gain or loss equal to the difference between its adjusted tax basis in
Capital Securities and the amount realized on the sale of such Capital
Securities (other than with respect to accrued and unpaid interest which has not
yet been included in income, which will be treated as ordinary income). A
holder's adjusted tax basis in the Capital Securities generally will be its
initial purchase price increased by OID (if any) previously includible in such
holder's gross income to the date of disposition and decreased by payments (if
any) received on the Capital Securities in respect of OID. Such gain or loss
generally will be a capital gain or loss and generally will be a
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<PAGE>
long-term capital gain or loss if the Capital Securities have been held for more
than the applicable holding period.
The Taxpayer Relief Act of 1997 reduces the maximum rates on long-term
capital gains recognized on capital assets held by individuals taxpayers for
more than eighteen months as of the date of disposition (and would further
reduce the maximum rates on such gains in the year 2001 and thereafter for
certain individual taxpayers who meet specified conditions). Prospective
investors should consult their own tax advisors concerning these tax law
changes.
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. A holder who uses the accrual method of
accounting for tax purposes (and a cash method holder, if the Junior
Subordinated Debentures are deemed to have been issued with OID) who disposes of
his Capital Securities between record dates for payments of distributions
thereon will be required to include accrued but unpaid interest on the Junior
Subordinated Debentures through the date of disposition in income as ordinary
income (i.e., interest or, if applicable, OID), and to add such amount to his
adjusted tax basis in his pro rata share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than the
holder's adjusted tax basis (which will include all accrued but unpaid
interest), a holder will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes.
Proposed Tax Legislation
The Taxpayer Relief Act of 1997, enacted on August 7, 1997, did not
contain certain provisions of President Clinton's Fiscal 1998 Budget Proposal
(the "Proposed Legislation") that would, among other things, have denied an
issuer a deduction for United States federal income tax purposes for the payment
of interest on instruments with characteristics similar to the Junior
Subordinated Debentures. There can be no assurances, however, that the proposed
legislation, if enacted, or similar legislation enacted after the date hereof
would not adversely affect the tax treatment of the Junior Subordinated
Debentures, resulting in a Tax Event. The occurrence of a Tax Event may result
in the redemption of the Junior Subordinated Debentures for cash, in which event
the holders of the Capital Securities would receive cash in redemption of their
Capital Securities. See "Description of Exchange Securities--Description of
Exchange Capital Securities--Redemption" and "Description of Exchange
Securities--Description of Exchange Junior Subordinated Debentures--Special
Event Prepayment."
United States Alien Holders
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is not a U.S. Holder
for United States federal income tax purposes.
A "U.S. Holder" is a holder of Capital Securities who or which is (i) a
citizen or individual resident (or is treated as a citizen or individual
resident) of the United States for federal income tax purposes, (ii) a
corporation or partnership created or organized in or under the laws of the
United States or any political subdivision thereof, (other than a partnership
that is not treated as a United States person under any applicable Treasury
regulations) or (iii) a trust or estate the income of which is includible in its
gross income for federal income tax purposes without regard to its source. For
taxable years beginning after December 31, 1996 (or for taxable years ending
after August 20, 1996, if the trustee so elects), a trust is a U.S. Holder if,
and only if, (a) a court within the United States is
77
<PAGE>
able to exercise primary supervision over the administration of the trust and
(b) one or more United States persons have the authority to control all
substantial decisions of the trust. To the extent provided in Treasury
regulations, certain trusts in existence on August 20, 1996 and treated as
United States persons prior to such date, that elect to continue to be treated
as United States persons, will be treated as a U.S. Holder.
Under present United States federal income tax laws: (i) payments by
the Trust or any of its paying agents to any holder of a Capital Security who or
which is a United States Alien Holder will not be subject to United States
federal withholding tax; provided that, (a) the beneficial owner of the Capital
Security does not actually or constructively own 10 percent or more of the total
combined voting power of all classes of stock of the Corporation entitled to
vote, (b) the beneficial owner of the Capital Security is not a controlled
foreign corporation that is related to the Corporation through stock ownership,
and (c) either (1) the beneficial owner of the Capital Security certifies to the
Trust or its agent, under penalties of perjury, that it is not a United States
holder and provides its name and address or (2) 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 Security in such capacity, certifies to the
Trust or its agent, under penalties of perjury, that such statement has been
received from the beneficial owner by it or by a Financial Institution between
it and the beneficial owner and furnishes the Trust or its agent with a copy
thereof; and (ii) a United States Alien Holder of a Capital Security will not be
subject to United States federal withholding tax on any gain realized upon the
sale or other disposition of a Capital Security unless (i) the gain is
effectively connected with the conduct of a trade or business within the United
States or (ii) the holder is an individual who was present in the United States
for at least 183 days during the taxable year of the sale and certain other
conditions are met.
As discussed above, changes in legislation affecting the United States
federal income tax treatment of the Junior Subordinated Debentures are possible,
and could adversely affect the ability of the Corporation to deduct the interest
payable on the Junior Subordinated Debentures. Moreover, any such legislation
could adversely affect United States Alien Holders by characterizing income
derived from the Junior Subordinated Debentures as dividends, generally subject
to a 30% income tax (on a withholding basis) when paid to a United States Alien
Holder, rather than as interest which, as discussed above, is generally exempt
from income tax in the hands of a United States Alien Holder.
Information Reporting to Holders
Generally, income on the Capital Securities will be reported to holders
on Forms 1099, which forms should be mailed to holders of Capital Securities by
January 31 following each calendar year.
Backup Withholding
Payments made on, and proceeds from the sale of, the Capital Securities
may be subject to a "backup" withholding tax of 31 percent unless the holder
complies with certain identification requirements. Any withheld amounts will be
allowed as a credit against the holder's United States federal income tax,
provided the required information is provided to the IRS.
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS
INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A
HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE EXCHANGE OF ORIGINAL CAPITAL
SECURITIES FOR EXCHANGE
78
<PAGE>
CAPITAL SECURITIES AND OF THE OWNERSHIP AND DISPOSITION OF THE CAPITAL
SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER
TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR OTHER
TAX LAWS.
ERISA CONSIDERATIONS
Each of the Corporation (the obligor with respect to the Exchange
Junior Subordinated Debentures held by the Trust), and its affiliates and the
Property Trustee may be considered a "party in interest" (within the meaning of
ERISA) or a "disqualified person" (within the meaning of Section 4975 of the
Code) with respect to many Plans. The purchase and/or holding of Exchange
Capital Securities by a Plan with respect to which the Corporation, the Property
Trustee or any affiliate is a service provider (or otherwise is a party in
interest or a disqualified person) may constitute or result in a prohibited
transaction under ERISA or Section 4975 of the Code, unless such Exchange
Capital Securities are acquired pursuant to and in accordance with an applicable
exemption, such as Prohibited Transaction Class Exemption ("PTCE") 84-14 (an
exemption for certain transactions determined by an independent qualified
professional asset manager), PTCE 91-38 (an exemption for certain transactions
involving bank collective investment funds), PTCE 90-1 (an exemption for certain
transactions involving insurance company pooled separate accounts), PTCE 95-60
(an exemption for transactions involving certain insurance company general
accounts) or PTCE 96-23 (an exemption for certain transactions determined by an
in-house asset manager). In addition, a Plan fiduciary considering the purchase
of Exchange Capital Securities should be aware that the assets of the Trust may
be considered "plan assets" for ERISA purposes. In such event, the Property
Trustee, as well as any other persons exercising discretion with respect to the
Exchange Junior Subordinated Debentures, may become fiduciaries, parties in
interest or disqualified persons with respect to investing Plans. In order to
avoid certain prohibited transactions under ERISA and the Code that could
thereby result, each investing Plan, by purchasing the Exchange Capital
Securities, will be deemed to have directed the Trust to invest in the Exchange
Junior Subordinated Debentures and to have consented to the appointment of the
Property Trustee. In this regard, it should be noted that, in an Event of
Default, the Corporation may not remove the Property Trustee without the
approval of a majority of the holders of the Exchange Capital Securities.
A Plan fiduciary should consider whether the purchase of Exchange
Capital Securities could result in a delegation of fiduciary authority to the
Property Trustee, and, if so, whether such a delegation of authority is
permissible under the Plan's governing instrument or any investment management
agreement with the Plan.
THE SALE OF INVESTMENTS TO PLANS IS IN NO RESPECT A REPRESENTATION BY
THE TRUST, THE CORPORATION, THE PROPERTY TRUSTEE, THE INITIAL PURCHASER OR ANY
OTHER PERSON ASSOCIATED WITH THE SALE OF THE EXCHANGE CAPITAL SECURITIES THAT
SUCH SECURITIES MEET RELEVANT LEGAL REQUIREMENTS WITH RESPECT TO INVESTMENTS BY
PLANS GENERALLY OR ANY PARTICULAR PLAN, OR THAT SUCH SECURITIES ARE OTHERWISE
APPROPRIATE FOR PLANS GENERALLY OR ANY PARTICULAR PLAN. ANY PURCHASER PROPOSING
TO ACQUIRE EXCHANGE CAPITAL SECURITIES WITH ASSETS OF ANY PLAN SHOULD CONSULT
WITH ITS COUNSEL.
79
<PAGE>
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange 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 Exchange Capital Securities.
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 Exchange Capital
Securities received in exchange for Original Capital Securities where such
Original Capital Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities. The Trust and the
Corporation have agreed that, starting on the Expiration Date and ending on the
close of business on the 90th day following the Expiration Date, it will make
this Prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, for a period of 90 days
after the Expiration Date, all dealers effecting transactions in the Exchange
Securities may be required to deliver a prospectus.
The Trust and the Corporation will not receive any proceeds from any
issuance of Exchange Capital Securities. Exchange Capital Securities received by
broker-dealers for their own account pursuant to 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 Exchange
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 Exchange Capital Securities. Any broker-dealer that
resells Exchange Capital Securities that were received by it for its own account
pursuant to the Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Capital Securities may be deemed to be an
"underwriter" within the meaning of the Securities Act, and any profit of any
such resale of Exchange 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.
VALIDITY OF EXCHANGE SECURITIES
The validity of the Exchange Junior Subordinated Debentures and the
Exchange Guarantee will be passed upon for the Corporation by Brown & Wood LLP,
New York, New York. Certain matters of Delaware law relating to the validity of
the Exchange Capital Securities will be passed upon on behalf of the Trust by
Richards, Layton & Finger, Wilmington, Delaware. Certain matters relating to
United States federal income tax considerations will be passed upon by Brown &
Wood LLP, New York, New York.
EXPERTS
The consolidated financial statements of the Corporation and its
subsidiaries incorporated by reference in the Corporation's Annual Report on
Form 10-K, as amended by Form 10-K/A, for the year ended December 31, 1996 and
incorporated by reference in this Prospectus have been audited by KPMG Peat
Marwick LLP, independent auditors, as stated in their report appearing therein.
Their report refers to changes in accounting for mortgage servicing rights in
1996, for impaired loans in 1995 and for certain investments in debt and equity
securities in 1994.
80
<PAGE>
No dealer, salesperson or other individual has been authorized to give
any information or to make any representations other than those contained or
incorporated by reference in this Prospectus in connection with this Exchange
Offer and, if given or made, such information or representations must not be
relied upon as having been authorized by the Corporation or the Trust. Neither
the delivery of this Prospectus nor any sale made hereunder shall under any
circumstances create an implication that there has not been any change in the
affairs of the Corporation or the Trust since the date hereof. This Prospectus
does not constitute an offer or solicitation by anyone in any jurisdiction in
which such offer or solicitation is not authorized or in which the person making
such offer or solicitation is not qualified to do so or to anyone to whom it is
unlawful to make such offer or solicitation.
-----------------------------
TABLE OF CONTENTS
Page
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Available Information.................................... 9
Incorporation of Certain Documents by Reference......... 10
Summary ................................................ 11
Risk Factors ........................................... 20
Banknorth Group, Inc. .................................. 28
Banknorth Capital Trust I. ............................. 29
Use of Proceeds ........................................ 30
Ratios of Earnings to Combined Fixed Charges ........... 30
Accounting Treatment.................................... 31
Capitalization ......................................... 32
Selected Consolidated Financial Data.................... 33
The Exchange Offer ..................................... 34
Description of Exchange Securities ..................... 45
Description of Original Securities ..................... 72
Relationship Among the Exchange Capital
Securities, the Exchange Junior
Subordinated Debentures and the
Exchange Guarantee ................................... 72
Certain Federal Income Tax Consequences ............... 74
ERISA Considerations ................................. 79
Plan of Distribution ................................... 80
Validity of Exchange Securities ........................ 80
Experts ..................................................80
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of Delaware authorizes the
registrant to indemnify its directors and officers under specified
circumstances. Article Twelfth of the certificate of incorporation of the
registrant provides in effect that the registrant shall provide certain
indemnification of its directors and officers.
Section 145 of the General Corporation Law of Delaware also authorizes
Banknorth Group, Inc. to indemnify persons who serve as directors or officers of
the registrant at the request of Banknorth Group, Inc. under specified
circumstances. Article Eleventh of the certificate of incorporation of Banknorth
Group, Inc. provides in effect that Banknorth Group, Inc. shall provide certain
indemnification to such persons.
The directors and officers of the registrant are insured, under
policies of insurance maintained by the registrant, within the limits and
subject to the limitations of the policies, against certain expenses in
connection with the defense of actions, suits or proceedings, to which they are
parties by reason of being or having been such directors or officers.
Item 21. Exhibits and Financial Statement Schedules.
4.1 Indenture, dated as of May 1, 1997, between the Corporation and The
First National Bank of Chicago, as Debenture Trustee.
4.2 Form of Exchange Junior Subordinated Debenture.
4.3 Certificate of Trust of Banknorth Capital Trust I, dated April 9,
1997.
4.4 Declaration of Trust of Banknorth Capital Trust I, dated as of April
9, 1997.
4.5 Amended and Restated Declaration of Trust of Banknorth Capital Trust
I, dated as of May 1, 1997.
4.6 Form of Exchange Capital Security.
4.7 Form of Exchange Guarantee.
4.8 Registration Rights Agreement, dated as of May 1, 1997, among
Banknorth Group, Inc., Banknorth Capital Trust I and the Initial
Purchaser.
4.9 Liquidated Damages Agreement, dated as of May 1, 1997, among the
Banknorth Group, Inc., Banknorth Capital Trust I and the Initial
Purchaser.
5.1 Opinion of Brown & Wood LLP as to the legality of the Exchange Junior
Subordinated Debentures and the Exchange Guarantee.
5.2 Opinion of Richards, Layton & Finger as to the legality of the
Exchange Capital Securities.
8.1 Opinion of Brown & Wood LLP as to certain federal income tax matters.
12.1 Computation of ratio of earnings to fixed charges (excluding interest
on deposits).
12.2 Computation of ratio of earnings to fixed charges (including interest
on deposits).
23.1 Consent of Brown & Wood LLP (included as part of Exhibit 5.1 and
Exhibit 8.1).
23.2 Consent of Richards, Layton & Finger (included as part of Exhibit 5.2)
23.3 Consent of KPMG Peat Marwick LLP.
II-2
<PAGE>
26.1 Form T-1 Statement of Eligibility of The First National Bank of
Chicago to act as Property Trustee under the Amended and Restated
Declaration of Trust.
26.2 Form T-1 Statement of Eligibility of The First National Bank of
Chicago to act as Guarantee Trustee under the Exchange Guarantee.
26.3 Form T-1 Statement of Eligibility of The First National Bank of
Chicago to act as Debenture Trustee under the Indenture.
99.1 Form of Letter of Transmittal.
99.2 Form of Notice of Guaranteed Delivery.
99.3 Form of Exchange Agent Agreement.
99.4 Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees.
99.5 Form of Letter to Clients.
Item 22. Undertakings.
Each of the undersigned registrants hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
such registrant's annual report pursuant to section 13(a) or section 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement 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.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, each of the
registrants has been advised that in the opinion of the 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 payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of such registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, each registrant will, unless in the opinion of its counsel the
matter has been settled by 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 be governed by
the final adjudication of such issue.
Each of the undersigned registrants hereby undertakes 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the city of Burlington,
state of Vermont, on the 23rd day of September, 1997.
Banknorth Group, Inc.
By:
--------------------------------------------
Name: William H. Chadwick
Title: President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below appoints Luther F. Hackett, William H. Chadwick and R. Allen Paul,
jointly and severally, each in his own capacity, his true and lawful
attorneys-in-fact, with full power of substitution for him and in his name,
place and stead, in any and all capacities to sign any amendments to this
Registration Statement, and to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Commission, hereby ratifying
and confirming all that said attorney-in-fact, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the 23rd day of September, 1997.
Signature Title
--------- -----
- -------------------------- Chairman of the Board
Luther F. Hackett
- -------------------------- President, Chief Executive Officer and Director
William H. Chadwick
- -------------------------- Executive Vice President and Chief Financial Officer
Thomas J. Pruitt
- -------------------------- Treasurer and Principal Accounting Officer
Neal E. Robinson
- -------------------------- Director
Thomas J. Amidon
- -------------------------- Director
Jacqueline D. Arthur
II-4
<PAGE>
- -------------------------- Director
Robert A. Carrara
- -------------------------- Director
Susan C. Crampton
- -------------------------- Director
Richard J. Fleming
- -------------------------- Director
Douglas G. Hyde
- -------------------------- Director
Kathleen Hoisington
- -------------------------- Director
Richard M. Narkewicz, M.D.
- -------------------------- Director
John B. Packard
- -------------------------- Director
R. Allan Paul
- -------------------------- Director
Angelo P. Pizzagalli
- -------------------------- Director
Thomas P. Salmon
II-5
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the city of Burlington,
state of Vermont, on the 23rd day of September, 1997.
BANKNORTH CAPITAL TRUST I
By:
--------------------------------------
Thomas J. Pruitt
as Administrative Trustee
By:
--------------------------------------
Neal E. Robinson
as Administrative Trustee
II-6
<PAGE>
EXHIBIT INDEX
Exhibit
No. Exhibit
- ------- -------
4.1 Indenture, dated as of May 1, 1997, between the Corporation
and The First National Bank of Chicago, as Debenture Trustee.
4.2 Form of Exchange Junior Subordinated Debenture.
4.3 Certificate of Trust of Banknorth Capital Trust I, dated April
9, 1997.
4.4 Declaration of Trust of Banknorth Capital Trust I, dated as of
April 9, 1997.
4.5 Amended and Restated Declaration of Trust of Banknorth Capital
Trust I, dated as of May 1, 1997.
4.6 Form of Exchange Capital Security.
4.7 Form of Exchange Guarantee Agreement.
4.8 Registration Rights Agreement, dated May 1, 1997, among
Banknorth Group, Inc., Banknorth Capital Trust I and the
Initial Purchaser.
4.9 Liquidated Damages Agreement, dated May 1, 1997, among the
Banknorth Group, Inc., Banknorth Capital Trust I and the
Initial Purchaser.
5.1 Opinion of Brown & Wood LLP as to the legality of the Exchange
Junior Subordinated Debentures and the Exchange Guarantee.
5.2 Opinion of Richards, Layton & Finger as to the legality of the
Exchange Capital Securities.
8.1 Opinion of Brown & Wood LLP as to certain federal income tax
matters.
12.1 Computation of ratio of earnings to fixed charges (excluding
interest on deposits).
12.2 Computation of ratio of earnings to fixed charges (including
interest on deposits).
23.1 Consent of Brown & Wood LLP (included as part of Exhibit 5.1
and Exhibit 8.1).
23.2 Consent of Richards, Layton & Finger (included as part of
Exhibit 5.2)
23.3 Consent of KPMG Peat Marwick LLP.
26.1 Form T-1 Statement of Eligibility of The First National Bank
of Chicago to act as Property Trustee under the Amended and
Restated Declaration of Trust.
26.2 Form T-1 Statement of Eligibility of The First National Bank
of Chicago to act as Guarantee Trustee under the Exchange
Guarantee.
26.3 Form T-1 Statement of Eligibility of The First National Bank
of Chicago to act as Debenture Trustee under the Indenture.
99.1 Form of Letter of Transmittal.
99.2 Form of Notice of Guaranteed Delivery.
99.3 Form of Exchange Agent Agreement.
<PAGE>
99.4 Form of Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
99.5 Form of Letter to Clients.
Exhibit 4.1
================================================================================
BANKNORTH GROUP, INC.
------------------------------
------------------------------
INDENTURE
Dated as of May 1, 1997
------------------------------
THE FIRST NATIONAL BANK OF CHICAGO
as Debenture Trustee
------------------------------
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
================================================================================
<PAGE>
Tie Sheet of provisions of Trust Indenture Act of 1939 with Indenture
dated as of May 1, 1997 between Banknorth Group, Inc. and The First National
Bank of Chicago, as Debenture Trustee:
ACT SECTION INDENTURE SECTION
310(a)(1).................................................................6.09
(a)(2) ................................................................6.09
310(a)(3)..................................................................N/A
(a)(4)..................................................................N/A
310(a)(5)...........................................................6.10, 6.11
310(b).....................................................................N/A
310(c)....................................................................6.13
311(a) and (b).............................................................N/A
311(c)...........................................................4.01, 4.02(a)
312(a)....................................................................4.02
312(b) and (c)............................................................4.04
313(a)....................................................................4.04
313(b)(1).................................................................4.04
313(b)(2).................................................................4.04
313(c)....................................................................4.04
313(d)....................................................................4.04
314(a)....................................................................4.03
314(b).....................................................................N/A
314(c)(1) and (2).........................................................6.07
314(c)(3)..................................................................N/A
314(d) ....................................................................N/A
314(e)....................................................................6.07
314(f) ....................................................................N/A
315(a)(c) and (d).........................................................6.01
315(b) ...................................................................5.08
315(e) ...................................................................5.09
316(a)(1) ................................................................5.07
316(a)(2) .................................................................N/A
316(a) last sentence .....................................................2.09
316(b) ...................................................................9.02
317(a) ...................................................................5.05
317(b) ...................................................................6.05
318(a) ..................................................................13.08
- --------------------------------
THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
<PAGE>
TABLE OF CONTENTS*
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ARTICLE I DEFINITIONS............................................... 1
SECTION 1.01. Definitions........................................... 1
Additional Sums...................................................... 1
Adjusted Treasury Rate............................................... 2
Affiliate............................................................ 2
Authenticating Agent................................................. 2
Banknorth Capital Trust.............................................. 2
Bankruptcy Law....................................................... 2
Board of Directors................................................... 2
Board Resolution..................................................... 2
Business Day......................................................... 2
Capital Securities................................................... 2
Capital Securities Guarantee......................................... 2
Commission........................................................... 3
Common Securities.................................................... 3
Common Securities Guarantee.......................................... 3
Common Stock......................................................... 3
Comparable Treasury Issue............................................ 3
Comparable Treasury Price............................................ 3
Compounded Interest.................................................. 3
Corporation.......................................................... 4
Corporation Request.................................................. 4
Custodian............................................................ 4
Debenture Trustee.................................................... 4
Declaration.......................................................... 4
Default.............................................................. 4
Defaulted Interest................................................... 4
Deferred Interest.................................................... 4
Definitive Securities................................................ 4
Depositary .......................................................... 4
Dissolution Event.................................................... 4
Event of Default..................................................... 5
Exchange Act......................................................... 5
Exchange Offer....................................................... 5
Exchange Securities................................................... 5
Extended Interest Payment Period..................................... 5
Federal Reserve...................................................... 5
Global Security...................................................... 5
Indebtedness......................................................... 5
Indebtedness Ranking on a Parity with the Securities................. 5
Indebtedness Ranking Junior to the Securities........................ 6
Indenture............................................................ 6
Initial Optional Prepayment Date..................................... 7
Initial Securities................................................... 7
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* This Table of Contents shall not, for any purpose, be deemed to be a part
of the Indenture.
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Interest Payment Date................................................ 7
Like Amount.......................................................... 7
Liquidated Damages................................................... 7
Make Whole Amount.................................................... 7
Maturity Date........................................................ 7
Non Book-Entry Capital Securities.................................... 7
Officers............................................................. 7
Officers' Certificate................................................ 7
Opinion of Counsel................................................... 7
Optional Prepayment Price............................................ 7
Other Debentures..................................................... 8
Other Guarantees..................................................... 8
outstanding.......................................................... 8
Person............................................................... 8
Predecessor Security................................................. 8
Prepayment Price..................................................... 9
Principal Office of the Debenture Trustee............................ 9
Property Trustee..................................................... 9
Purchase Agreement................................................... 9
Quotation Agent...................................................... 9
Reference Treasury Dealer............................................ 9
Reference Treasury Dealer Quotations................................. 9
Registration Rights Agreement........................................ 9
Regulatory Capital Event............................................. 9
Responsible Officer.................................................. 9
Restricted Security.................................................. 9
Rule 144A............................................................ 9
Securities........................................................... 9
Securities Act....................................................... 9
Securityholder....................................................... 9
holder of Securities................................................. 9
Security Register.................................................... 9
Senior Indebtedness.................................................. 10
Special Event........................................................ 10
Special Event Prepayment Price....................................... 10
Subsidiary........................................................... 10
Tax Event............................................................ 10
Trust Indenture Act...................................................12
Trust Securities..................................................... 12
U.S. Government Obligations.......................................... 12
ARTICLE II SECURITIES................................................ 12
SECTION 2.01. Forms Generally.................................... 12
SECTION 2.02. Execution and Authentication....................... 12
SECTION 2.03. Form and Payment................................... 13
SECTION 2.04. Legends............................................ 13
SECTION 2.05. Global Security.................................... 13
SECTION 2.06 Interest........................................... 15
SECTION 2.07. Transfer and Exchange.............................. 16
SECTION 2.08. Replacement Securities............................. 18
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SECTION 2.09. Temporary Securities............................... 19
SECTION 2.10. Cancellation....................................... 19
SECTION 2.11. Defaulted Interest................................. 19
SECTION 2.12. CUSIP Numbers...................................... 21
ARTICLE III PARTICULAR COVENANTS OF THE CORPORATION................... 21
SECTION 3.01. Payment of Principal, Premium and Interest......... 21
SECTION 3.02. Offices for Notices and Payments, etc.............. 21
SECTION 3.03. Appointments to Fill Vacancies in Debenture
Trustee's Office................................... 22
SECTION 3.04. Provision as to Paying Agent....................... 22
SECTION 3.05. Certificate to Debenture Trustee................... 23
SECTION 3.06. Compliance with Consolidation
Provisions......................................... 24
SECTION 3.07. Limitation on Dividends............................ 24
SECTION 3.08. Covenants as to Banknorth Capital Trust............ 25
SECTION 3.09. Payment of Expenses................................ 25
SECTION 3.10. Payment Upon Resignation or Removal................ 26
ARTICLE IV SECURITYHOLDERS' LISTS AND REPORTS BY THE
CORPORATION AND THE DEBENTURE TRUSTEE
SECTION 4.01. Securityholders' Lists............................. 26
SECTION 4.02. Preservation and Disclosure of Lists............... 27
SECTION 4.03. Reports by the Corporation......................... 29
SECTION 4.04. Reports by the Debenture Trustee................... 30
ARTICLE V REMEDIES OF THE DEBENTURE TRUSTEE AND
SECURITYHOLDERS ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.................................. 30
SECTION 5.02. Payment of Securities on Default; Suit
Therefor........................................... 33
SECTION 5.03. Application of Moneys Collected by Debenture
Trustee............................................ 35
SECTION 5.04. Proceedings by Securityholders..................... 35
SECTION 5.05. Proceedings by Debenture Trustee................... 36
SECTION 5.06. Remedies Cumulative and Continuing................. 37
SECTION 5.07. Direction of Proceedings and Waiver of
Defaults by Majority of Securityholders............ 37
SECTION 5.08. Notice of Defaults................................. 38
SECTION 5.09. Undertaking to Pay Costs........................... 39
ARTICLE VI CONCERNING THE DEBENTURE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Debenture
Trustee............................................ 39
SECTION 6.02. Reliance on Documents, Opinions, etc............... 41
SECTION 6.03. No Responsibility for Recitals, etc................ 43
SECTION 6.04. Debenture Trustee, Authenticating Agent,
Paying Agents, Transfer Agents or Registrar
May Own Securities................................. 43
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SECTION 6.05. Moneys to be Held in Trust......................... 43
SECTION 6.06. Compensation and Expenses of Debenture
Trustee............................................ 43
SECTION 6.07. Officers' Certificate as Evidence.................. 44
SECTION 6.08. Conflicting Interest of Debenture Trustee.......... 45
SECTION 6.09. Eligibility of Debenture Trustee................... 45
SECTION 6.10. Resignation or Removal of Debenture
Trustee............................................ 45
SECTION 6.11. Acceptance by Successor Debenture Trustee.......... 47
SECTION 6.12. Succession by Merger, etc.......................... 48
SECTION 6.13. Limitation on Rights of Debenture Trustee as
a Creditor......................................... 48
SECTION 6.14. Authenticating Agents.............................. 48
ARTICLE VII CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.......................... 50
SECTION 7.02. Proof of Execution by Securityholders.............. 51
SECTION 7.03. Who Are Deemed Absolute Owners..................... 51
SECTION 7.04. Securities Owned by Corporation Deemed
Not Outstanding.................................... 51
SECTION 7.05. Revocation of Consents; Future Holders
Bound.............................................. 52
ARTICLE VIII SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings............................... 52
SECTION 8.02. Call of Meetings by Debenture Trustee.............. 53
SECTION 8.03. Call of Meetings by Corporation or
Securityholders.................................... 53
SECTION 8.04. Qualifications for Voting.......................... 53
SECTION 8.05. Regulations........................................ 54
SECTION 8.06. Voting............................................. 54
ARTICLE IX AMENDMENTS
SECTION 9.01. Without Consent of Securityholders................. 55
SECTION 9.02. With Consent of Securityholders.................... 57
SECTION 9.03. Compliance with Trust Indenture Act;
Effect of Supplemental Indentures.................. 58
SECTION 9.04. Notation on Securities............................. 58
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished to Debenture
Trustee............................................ 58
ARTICLE X CONSOLIDATION, MERGER, SALE, CONVEYANCE AND
LEASE
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SECTION 10.01. Corporation May Consolidate, etc., on
Certain Terms...................................... 59
SECTION 10.02. Successor Corporation to be Substituted
for Corporation.................................... 59
SECTION 10.03. Opinion of Counsel to be Given Debenture
Trustee............................................ 60
ARTICLE XI SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture............................. 60
SECTION 11.02. Deposited Moneys and U.S. Government
Obligations to be Held in Trust by Debenture
Trustee............................................ 61
SECTION 11.03. Paying Agent to Repay Moneys Held.................. 61
SECTION 11.04. Return of Unclaimed Moneys......................... 62
SECTION 11.05. Defeasance Upon Deposit of Moneys or
U.S. Government Obligations........................ 62
ARTICLE XII IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS.................................... 64
SECTION 12.01. Indenture and Securities Solely Corporate
Obligations........................................ 64
ARTICLE XIII MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors......................................... 64
SECTION 13.02. Official Acts by Successor Corporation............. 64
SECTION 13.03. Surrender of Corporation Powers.................... 65
SECTION 13.04. Addresses for Notices, etc......................... 65
SECTION 13.05. Governing Law...................................... 65
SECTION 13.06. Evidence of Compliance with Conditions
Precedent.......................................... 65
SECTION 13.07. Business Days...................................... 66
SECTION 13.08. Trust Indenture Act to Control..................... 66
SECTION 13.09. Table of Contents, Headings, etc................... 66
SECTION 13.10. Execution in Counterparts.......................... 66
SECTION 13.11. Separability....................................... 67
SECTION 13.12. Assignment......................................... 67
SECTION 13.13. Acknowledgement of Rights.......................... 67
ARTICLE XIV PREPAYMENT OF SECURITIES -- MANDATORY AND
OPTIONAL SINKING FUND
SECTION 14.01. Special Event Prepayment........................... 68
SECTION 14.02. Optional Prepayment by Corporation................. 68
SECTION 14.03. No Sinking Fund.................................... 69
SECTION 14.04. Notice of Prepayment; Selection of Securities...... 69
SECTION 14.05. Payment of Securities Called for Prepayment........ 70
ARTICLE XV SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate........................... 71
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SECTION 15.02. Default on Senior Indebtedness..................... 72
SECTION 15.03. Liquidation; Dissolution; Bankruptcy............... 72
SECTION 15.04. Subrogation........................................ 74
SECTION 15.05. Debenture Trustee to Effectuate Subordination...... 75
SECTION 15.06. Notice by the Corporation.......................... 75
SECTION 15.07. Rights of the Debenture Trustee; Holders
of Senior Indebtedness............................. 77
SECTION 15.08. Subordination May Not Be Impaired.................. 77
ARTICLE XVI EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period............... 78
SECTION 16.02. Notice of Extension................................ 79
TESTIMONIUM.................................................................81
SIGNATURES..................................................................81
EXHIBIT A..................................................................A-1
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THIS INDENTURE, dated as of May 1, 1997, between Banknorth Group,
Inc., a Delaware corporation (hereinafter sometimes called the "Corporation"),
and The First National Bank of Chicago, a national banking association, as
debenture trustee (hereinafter sometimes called the "Debenture Trustee").
W I T N E S S E T H :
In consideration of the premises, and the purchase of the Securities
(as defined below) by the holders thereof, the Corporation covenants and agrees
with the Debenture Trustee for the equal and proportionate benefit of the
respective holders from time to time of the Securities, as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Indenture shall have the respective meanings specified in this Section
1.01. All other terms used in this Indenture which are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), or which are by
reference therein defined in the Securities Act of 1933, as amended (the
"Securities Act"), shall (except as herein otherwise expressly provided or
unless the context otherwise requires) have the meanings assigned to such terms
in said Trust Indenture Act and in said Securities Act as in force at the date
of this Indenture as originally executed. The following terms have the meanings
given to them in the Declaration: (i) Clearing Agency; (ii) Delaware Trustee;
(iii) Property Trustee; (iv) Administrative Trustees; (v) Initial Capital
Securities; (vi) Exchange Capital Securities; (vii) Direct Action; (viii)
Initial Capital Securities Guarantee; (ix) Exchange Capital Securities
Guarantee; and (x) Distributions. All accounting terms used herein and not
expressly defined shall have the meanings assigned to such terms in accordance
with generally accepted accounting principles, and the term "generally accepted
accounting principles" means such accounting principles as are generally
accepted at the time of any computation. The words "herein", "hereof" and
"hereunder" and other words of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other subdivision. Headings are
used for convenience of reference only and do not affect interpretation. The
singular includes the plural and vice versa.
"Additional Sums" shall have the meaning set forth in Section
2.06(c).
<PAGE>
"Adjusted Treasury Rate" means, with respect to any prepayment date
pursuant to Section 14.01, the rate per annum equal to (i) the yield, under the
heading which represents the average for the immediately prior week, 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
maturity corresponding to the Remaining Life, yields for the two published
maturities most closely corresponding to the Remaining Life shall be determined,
and the Adjusted 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 prepayment date, in each case calculated on the third Business Day
preceding the prepayment date, plus in each case (a)3.31% if such prepayment
date occurs on or prior to May 1, 1998 and (b) 2.76% in all other cases.
"Affiliate" shall have the meaning given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
"Authenticating Agent" shall mean any agent or agents of the
Debenture Trustee which at the time shall be appointed and acting pursuant to
Section 6.14.
"Banknorth Capital Trust" or the "Trust" shall mean Banknorth
Capital Trust I, a Delaware business trust created for the purpose of issuing
its undivided beneficial interests in connection with the issuance of Securities
under this Indenture.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any similar
federal or state law for the relief of debtors.
"Board of Directors" shall mean either the Board of Directors of the
Corporation or any duly authorized committee of that board.
"Board Resolution" shall mean a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Corporation to have been duly
adopted by the Board of Directors
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and to be in full force and effect on the date of such certification, and
delivered to the Debenture Trustee.
"Book-Entity Capital Securities" shall have the meaning set forth in
Section 2.05(a)(i).
"Business Day" shall mean, with respect to any series of Securities,
any day other than a Saturday or a Sunday or a day on which banking institutions
in New York, New York or Burlington, Vermont are authorized or required by law
or executive order to remain closed.
"Capital Securities" shall mean undivided beneficial interests in
the assets of the Trust which are designated as "Capital Securities" and rank
pari passu with the Common Securities issued by the Trust; provided, however,
that if an Event of Default has occurred and is continuing, no payments in
respect of Distributions on, or payments upon liquidation, prepayment or
otherwise with respect to, the Common Securities shall be made until the holders
of the Capital Securities shall be paid in full the Distributions and the
liquidation, prepayment and other payments to which they are entitled.
References to "Capital Securities" shall include collectively any Initial
Capital Securities and Exchange Capital Securities.
"Capital Securities Guarantee" shall mean any guarantee agreement
that the Corporation may enter into with The First National Bank of Chicago or
other Persons that operates directly or indirectly for the benefit of holders of
Capital Securities and shall include the Initial Capital Securities Guarantee
and the Exchange Capital Securities Guarantee with respect to the Initial
Capital Securities and the Exchange Capital Securities, respectively.
"Commission" shall mean the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Securities" shall mean undivided beneficial interests in the
assets of the Trust which are designated as "Common Securities" and rank pari
passu with Capital Securities issued by the Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, prepayment or otherwise with
respect to, the Common Securities shall be made until the holders of the Capital
Securities shall be paid in full the Distributions and the liquidation,
prepayment and other payments to which they are then entitled.
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"Common Securities Guarantee" shall mean any guarantee that the
Corporation may enter into that operates directly or indirectly for the benefit
of holders of Common Securities.
"Common Stock" shall mean the Common Stock, par value $1.00 per
share, of the Corporation or any other class of stock resulting from changes or
reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
"Comparable Treasury Issue" shall mean the United States Treasury
security selected by the Quotation Agent as having a maturity comparable to the
Remaining Life of the Securities 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
of the Securities, provided that if no United States Treasury security has a
maturity which is within a period from three months before to three months after
the Remaining Life, the two most closely corresponding United States Treasury
securities shall be used as the Comparable Treasury Issue, and the Adjusted
Treasury Rate shall be interpolated or extrapolated on a straight-line basis,
rounding to the nearest month, using such securities.
"Comparable Treasury Price" shall mean, with respect to any
prepayment date pursuant to Section 14.01, (i) the average of three Reference
Treasury Dealer Quotations for such prepayment date, after excluding the highest
and lowest Reference Treasury Dealer Quotations, or (ii) if the Debenture
Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the
average of all such Reference Treasury Dealer Quotations.
"Corporation" shall mean Banknorth Group, Inc., a Dela- ware
corporation, and, subject to the provisions of Article X, shall include its
successors and assigns.
"Corporation Request" or "Corporation Order" shall mean a written
request or order signed in the name of the Corporation by an Officer and
delivered to the Debenture Trustee.
"Compounded Interest" shall have the meaning set forth in Section
16.01.
"Custodian" shall mean any receiver, trustee, assignee, liquidator,
or similar official under any Bankruptcy Law.
"Debenture Trustee" shall mean the Person identified as "Debenture
Trustee" in the first paragraph hereof, and, subject to the provisions of
Article VI hereof, shall also include its successors and assigns as Debenture
Trustee hereunder.
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"Declaration" shall mean the Amended and Restated Declaration of
Trust of the Trust, dated as of May 1, 1997, as amended from time to time.
"Default" shall mean any event, act or condition that with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulted Interest" shall have the same meaning set forth in
Section 2.11.
"Deferred Interest" shall have the meaning set forth in Section
16.01.
"Definitive Securities" shall mean those securities issued in fully
registered certificated form not otherwise in global form.
"Depositary" shall mean, with respect to the Securities for which
the Corporation shall determine that such Securities will be issued as a Global
Security, The Depository Trust Company, New York, New York, another clearing
agency, or any successor registered as a clearing agency under the Exchange Act
or other applicable statute or regulation, which, in each case, shall be
designated by the Corporation pursuant to Section 2.05(d).
"Dissolution Event" shall mean the liquidation of the Trust pursuant
to the Declaration, and the distribution of the Securities held by the Property
Trustee to the holders of the Trust Securities issued by the Trust pro rata in
accordance with the Declaration.
"Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice, if
any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" shall mean the offer that may be made pursuant to
the Registration Rights Agreement (i) by the Corporation to exchange the
Exchange Securities for the Initial Securities and to execute the Exchange
Capital Securities Guarantee in respect of the Exchange Capital Securities and
(ii) by the Trust to exchange the Exchange Capital Securities for the Initial
Capital Securities.
"Exchange Securities" shall mean the Corporation's 10.52% Junior
Subordinated Deferrable Interest Debentures due May 1, 2027, Series B, as
authenticated and issued under this Indenture.
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"Extended Interest Payment Period" shall have the meaning set forth
in Section 16.01.
"Federal Reserve" shall mean the Board of Governors of the Federal
Reserve System.
"Global Security" shall mean, with respect to the Securities, a
Security executed by the Corporation and delivered by the Debenture Trustee to
the Depositary or pursuant to the Depositary's instruction, all in accordance
with the Indenture, which shall be registered in the name of the Depositary or
its nominee.
"Indebtedness" shall mean (i) every obligation of the Corporation
for money borrowed; (ii) every obligation of the Corporation 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 Corporation with respect to letters of
credit, banker's acceptances or similar facilities issued for the account of the
Corporation; (iv) every obligation of the Corporation 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 Corporation; (vi) all indebtedness of the
Corporation, whether incurred on or prior to the date of this Indenture or
hereafter incurred, for claims in respect of derivative products, including
interest rate, foreign exchange rate and commodity forward contracts, options
and swaps and similar arrangements; and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, the Corporation has
guaranteed or is responsible or liable for, directly or indirectly, as obligor
or otherwise.
"Indebtedness Ranking on a Parity with the Securities" shall mean
(i) Indebtedness, whether outstanding on the date of execution of this Indenture
or hereafter created, assumed or incurred, to the extent such Indebtedness by
its terms ranks pari passu with and not prior to the Securities in the right of
payment upon the happening of the dissolution or winding-up or liquidation or
reorganization of the Corporation, and (ii) all other debt securities, and
guarantees in respect of those debt securities, issued to any trust other than
the Trust, or a trustee of such trust, partnership or other entity affiliated
with the Corporation, that is a financing vehicle of the Corporation (a
"financing entity") in connection with the issuance by such financing entity of
equity securities or other securities guaranteed by the Corporation pursuant to
an instrument that ranks pari passu with or junior in right of payment to the
Capital Securities Guarantee. The securing of any Indebtedness
6
<PAGE>
otherwise constituting Indebtedness Ranking on a Parity with the Securities
shall not be deemed to prevent such Indebtedness from constituting Indebtedness
Ranking on a Parity with the Securities.
"Indebtedness Ranking Junior to the Securities" shall mean any
Indebtedness, whether outstanding on the date of execution of this Indenture or
hereafter created, assumed or incurred, to the extent such Indebtedness by its
terms ranks junior to and not pari passu with or prior to the Securities (and
any other Indebtedness Ranking on a Parity with the Securities) in right of
payment upon the happening of the dissolution or winding-up or liquidation or
reorganization of the Corporation. The securing of any Indebtedness otherwise
constituting Indebtedness Ranking Junior to the Securities shall not be deemed
to prevent such Indebtedness from constituting Indebtedness Ranking Junior to
the Securities.
"Indenture" shall mean this instrument as originally executed or, if
amended as herein provided, as so amended.
"Initial Optional Prepayment Date" shall mean May 1, 2007.
"Initial Securities" shall mean the Corporation's 10.52% Junior
Subordinated Deferrable Interest Debentures due May 1, 2027, Series A, as
authenticated and issued under this Indenture.
"Interest Payment Date" shall have the meaning set forth in Section
2.06(a).
"Like Amount" shall mean (i) with respect to a redemption of the
Trust Securities, Trust Securities having a liquidation amount equal to the
principal amount of Securities to be paid in accordance with their terms and
(ii) with respect to a distribution of Securities upon the liquidation of the
Trust, Securities having a principal amount equal to the liquidation amount of
the Trust Securities of the holder to whom Securities are distributed.
"Liquidated Damages" shall have the meaning set forth in the
Registration Rights Agreement.
"Make Whole Amount" shall mean an amount equal to the greater of (x)
100% of the principal amount of Securities to be prepaid or (y) the sum, as
determined by a Quotation Agent, of the present values of the remaining
scheduled payments of principal and interest on such Securities, discounted to
the prepayment date on a semi-annual basis (assuming a 360-day year consisting
of twelve 30-day months) at the Adjusted Treasury Rate, plus, in the case of
each of clauses (x) and (y), accrued and unpaid
7
<PAGE>
interest thereon, including Compounded Interest and Additional Sums, if any, to
the date of such prepayment.
"Maturity Date" shall mean May 1, 2027.
"Non Book-Entry Capital Securities" shall have the meaning set forth
in Section 2.05(a)(ii).
"Officers" shall mean any of the Chairman, the Chief Executive
Officer, the President, an Executive or Senior Vice President, a Vice President,
the Chief Financial Officer, the Secretary or an Assistant Secretary of the
Corporation.
"Officers' Certificate" shall mean a certificate signed by two
Officers and delivered to the Debenture Trustee.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be an employee of the Corporation, and who shall be reasonably acceptable to
the Debenture Trustee.
"Optional Prepayment Price" shall have the meaning set
forth in Section 14.02(a).
"Other Debentures" shall mean all junior subordinated debentures
other than the Securities issued by the Corporation from time to time and sold
to trusts other than the Trust to be established by the Corporation (if any), in
each case similar to the Trust.
"Other Guarantees" shall mean all guarantees other than the Capital
Securities Guarantee and the Common Guarantee issued by the Corporation with
respect to preferred beneficial interests (if any) issued to trusts other than
the Trust to be established by the Corporation (if any), in each case similar to
the Trust.
The term "outstanding" when used with reference to the Securities,
shall mean, subject to the provisions of Section 7.04, as of any particular
time, all Securities authenticated and delivered by the Debenture Trustee or the
Authenticating Agent under this Indenture, except
(a) Securities theretofore cancelled by the Debenture Trustee or
the Authenticating Agent or delivered to the Debenture Trustee
for cancellation;
(b) Securities, or portions thereof, for the payment or prepayment
of which moneys in the necessary amount shall have been
deposited in trust with the Debenture Trustee or with any
paying agent (other than the Corporation) or shall have been
set aside and segregated in trust by the Corporation (if the
Corporation shall act as its own paying agent);
8
<PAGE>
provided that, if such Securities, or portions thereof, are to
be prepaid prior to maturity thereof, notice of such
prepayment shall have been given as set forth in Article XIV
or provision satisfactory to the Debenture Trustee shall have
been made for giving such notice; and
(c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered
pursuant to the terms of Section 2.08 unless proof
satisfactory to the Corporation and the Debenture Trustee is
presented that any such Securities are held by bona fide
holders in due course.
"Person" shall mean any individual, corporation, estate,
partnership, joint venture, association, joint-stock company, limited liability
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Predecessor Security" of any particular Security shall mean every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 2.08 in lieu of a lost,
destroyed or stolen Security shall be deemed to evidence the same debt as the
lost, destroyed or stolen Security.
"Prepayment Price" shall mean the Special Event Prepayment Price or
the Optional Prepayment Price, as the context requires.
"Principal Office of the Debenture Trustee", or other similar term,
shall mean the office of the Debenture Trustee, at which at any particular time
its corporate trust business shall be administered.
"Purchase Agreement" shall mean the Purchase Agreement dated April
28, 1997 among the Corporation, the Trust and the initial purchaser named
therein.
"Quotation Agent" shall mean the Reference Treasury Dealer appointed
by the Corporation.
"Reference Treasury Dealer" shall mean a nationally recognized U.S.
Government securities dealer in New York, New York selected by the Corporation.
"Reference Treasury Dealer Quotations" shall mean, with respect to
each Reference Treasury Dealer and any prepayment date pursuant to Section
14.01, the average, as determined by the
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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, New York time, on the third Business Day preceding such prepayment
date.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement, dated as of May 1, 1997, among the Corporation, the Trust and the
initial purchaser named therein, as such agreement may be amended, modified or
supplemented from time to time.
"Regulatory Capital Event" shall mean that the Corporation shall
have received an opinion of bank regulatory counsel experienced in such matters
to the effect that, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any rules, guidelines or policies of an applicable
regulatory agency for the Corporation or (b) any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or which pronouncement or
decision is announced on or after May 1, 1997, the Capital Securities do not
constitute, or within 90 days of the date thereof, will not constitute, Tier 1
Capital (or its then equivalent); provided, however, that the distribution of
the Securities in connection with the liquidation of the Trust by the
Corporation, as sponsor, shall not in and of itself constitute a Regulatory
Capital Event unless such liquidation shall have occurred in connection with a
Tax Event.
"Remaining Life" shall mean the term of the Securities from any
prepayment date pursuant to Section 14.01 to the Maturity Date.
"Responsible Officer" shall mean any officer of the Debenture
Trustee's Corporate Trust Administration department with direct responsibility
for the administration of the Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Security" shall mean Securities that bear or are
required to bear the legends relating to transfer restrictions under the
Securities Act set forth in Exhibit A hereto.
"Rule 144A" shall mean Rule 144A under the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Securities" shall mean, collectively, the Initial Securities and
the Exchange Securities.
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"Securityholder", "holder of Securities", or other similar terms,
shall mean any Person in whose name at the time a particular Security is
registered in the Security Register kept by the Corporation or the Debenture
Trustee for that purpose in accordance with the terms hereof.
"Security Register" shall mean (i) prior to a Dissolution Event, the
list of holders provided to the Debenture Trustee pursuant to Section 4.01, and
(ii) following a Dissolution Event, any security register maintained by a
security registrar for the Securities appointed by the Corporation following the
execution of a supplemental indenture providing for transfer procedures as
provided for in Section 2.07(a).
"Senior Indebtedness" shall mean all Indebtedness, whether
outstanding on the date of execution of this Indenture or hereafter created,
assumed or incurred, except Indebtedness Ranking on a Parity with the Securities
or Indebtedness Ranking Junior to the Securities, and any deferrals, renewals or
extensions of such Senior Indebtedness.
"Special Event" shall mean either a Regulatory Capital Event or a
Tax Event.
"Special Event Prepayment Price" shall mean, with respect to any
prepayment of the Securities following a Special Event, an amount in cash equal
to the Make Whole Amount.
"Subsidiary" shall mean with respect to any Person, (i) any
corporation at least a majority of the outstanding voting stock of which is
owned, directly or indirectly, by such Person or by one or more of its
Subsidiaries, or by such Person and one or more of its Subsidiaries, (ii) any
general partnership, joint venture or similar entity, at least a majority of
whose outstanding partnership or similar interests shall at the time be owned by
such Person or by one or more of its Subsidiaries, or by such Person and one or
more of its Subsidiaries and (iii) any limited partnership of which such Person
or any of its Subsidiaries is a general partner. For the purposes of this
definition, "voting stock" means shares, interests, participations or other
equivalents in the equity interest (however designated) in such Person having
ordinary voting power for the election of a majority of the directors (or the
equivalent) of such Person, other than shares, interests, participations or
other equivalents having such power only by reason of the occurrence of a
contingency.
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"Tax Event" shall mean the receipt by the Trust and the Corporation
of an opinion of counsel experienced in such matters to the effect that, as a
result of any amendment to, or change (including any announced prospective
change) in, the laws or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after May 1, 1997, there is
more than an insubstantial risk that (i) the Trust is, or will be within 90 days
of the date of such opinion, subject to United States federal income tax with
respect to income received or accrued on the Securities, (ii) the interest
payable by the Corporation on the Securities is not, or within 90 days of the
date of such opinion will not be, deductible by the Corporation, in whole or in
part, for United States federal income tax purposes or (iii) the Trust is, or
will be within 90 days of the date of such opinion, subject to more than a de
minimis amount of other taxes, duties or other governmental charges.
"Trust Securities" shall mean, collectively, the Capital Securities
and the Common Securities.
"U.S. Government Obligations" shall mean securities that are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case under
clauses (i) or (ii) are not callable or prepayable at the option of the issuer
thereof, and shall also include a depository receipt issued by a bank or trust
company as custodian with respect to any such U.S. Government Obligation or a
specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of interest on or principal
of the U.S. Government Obligation evidenced by such depository receipt.
SECTION 1.02. Business Day Certificate.
On the date of execution and delivery of this Indenture (with
respect to the remainder of calendar year 1997) and thereafter, within 15 days
prior to the end of each calendar year while this Indenture remains in effect
(with respect to the succeeding calendar years), the Corporation shall deliver
to the
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Debenture Trustee an Officers' Certificate specifying the days on which banking
institutions or trust companies in Burlington, Vermont are then authorized or
obligated by law or executive order to remain closed.
ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally.
The Securities and the Debenture Trustee's certificate of
authentication shall be substantially in the form of Exhibit A, the terms of
which are incorporated in and made a part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Corporation is subject or usage. Each Security shall be
dated the date of its authentication.
SECTION 2.02. Execution and Authentication.
An Officer shall sign the Securities for the Corporation by manual
or facsimile signature. If an Officer whose signature is on a Security no longer
holds that office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of the Debenture Trustee. The signature of the Debenture Trustee shall
be conclusive evidence that the Security has been authenticated under this
Indenture.
The Debenture Trustee shall, upon a Corporation Order, authenticate
for original issue up to, and the aggregate principal amount of Securities
outstanding at any time may not exceed, $30,928,000 aggregate principal amount
of the Securities, except as provided in Sections 2.07, 2.08, 2.09 and 14.05.
The series of Securities to be initially issued hereunder shall be the Initial
Securities.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.05, the Securities shall be issued
in fully registered certificated form without interest coupons. Principal of and
premium, if any, and interest on the Securities issued in certificated form will
be payable, the transfer of such Securities will be registrable and such
Securities will be exchangeable for Securities bearing identical terms and
provisions at the office or agency of the Corporation maintained for such
purpose under Section 3.02; provided, however, that payments of interest may be
made at the option of the
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Corporation (i) by check mailed to the holder at such address as shall appear in
the Security Register or (ii) by transfer to an account maintained by the Person
entitled thereto, provided that proper transfer instructions have been received
in writing by the relevant record date. Notwithstanding the foregoing, so long
as the holder of any Securities is the Property Trustee, the payment of the
principal of and premium, if any, and interest (including Compounded Interest
and Additional Sums, if any) and Liquidated Damages, if any, on such Securities
held by the Property Trustee will be made at such place and to such account as
may be designated by the Property Trustee.
SECTION 2.04. Legends.
(a) Except as permitted by subsection (b) of this Section 2.04 or as
otherwise determined by the Corporation in accordance with applicable law, each
Security shall bear the applicable legends relating to restrictions on transfer
pursuant to the Securities Act and any other applicable securities laws in
substantially the form set forth on Exhibit A hereto.
(b) In the event of an Exchange Offer, the Corporation shall issue
and the Debenture Trustee, upon Corporation Order, shall authenticate Exchange
Securities in exchange for Initial Securities accepted for exchange in the
Exchange Offer, which Exchange Securities shall not bear the legends required by
subsection (a) above, in each case unless the holder of such Initial Securities
is either (A) a broker-dealer who purchased such Initial Securities directly
from the Corporation for resale pursuant to Rule 144A or any other available
exemption under the Securities Act, (B) a Person participating in the
distribution of the Initial Securities or (C) a Person who is an Affiliate of
the Corporation or the Trust.
SECTION 2.05. Global Security.
(a) In connection with a Dissolution Event,
(i) if any Capital Securities are held in book-entry form
("Book-Entry Capital Securities"), a Like Amount of Definitive Securities
shall be presented to the Debenture Trustee (if an arrangement with the
Depositary has been maintained) by the Property Trustee in exchange for
one or more Global Securities (as may be required pursuant to Section
2.07), to be registered in the name of the Depositary, or its nominee,
and delivered by the Debenture Trustee to the Depositary for crediting to
the accounts of its participants pursuant to the instructions of the
Administrative Trustees; the Corporation upon any such presentation shall
execute one or more Global Securities in such aggregate principal amount
and deliver the same to the Debenture Trustee for authentication and
delivery in accordance with
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this Indenture; and payments on the Securities issued as a Global Security
will be made to the Depositary; and
(ii) if any Capital Securities are held in certificated form,
the related Definitive Securities may be presented to the Debenture
Trustee by the Property Trustee and any Capital Security certificates
which represent Capital Securities other than Book-Entry Capital
Securities ("Non Book-Entry Capital Securities") will be deemed to
represent beneficial interests in Securities presented to the Debenture
Trustee by the Property Trustee having an aggregate principal amount equal
to the aggregate liquidation amount of the Non Book-Entry Capital
Securities until such Capital Security certificates are presented to the
security registrar for the Securities for transfer or reissuance, at which
time such Capital Security certificates will be cancelled and a Security
in a Like Amount, registered in the name of the holder of the Capital
Security certificate or the transferee of the holder of such Capital
Security certificate, as the case may be, will be executed by the
Corporation and delivered to the Debenture Trustee for authentication and
delivery in accordance with this Indenture; and upon the issuance of such
Securities, Securities with an equivalent aggregate principal amount that
were presented by the Property Trustee to the Debenture Trustee will be
cancelled.
(b) The Global Securities shall represent the aggregate amount of
outstanding Securities from time to time endorsed thereon; provided, that the
aggregate principal amount of outstanding Securities represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges
and prepayments. Any endorsement of a Global Security to reflect the amount of
any increase or decrease in the aggregate principal amount of outstanding
Securities represented thereby shall be made by the Debenture Trustee, in
accordance with instructions given by the Corporation as required by this
Section 2.05.
(c) The Global Securities may be transferred, in whole but not in
part, only to the Depositary, to another nominee of the Depositary, or to a
successor Depositary selected or approved by the Corporation or to a nominee of
such successor Depositary.
(d) If at any time the Depositary notifies the Corporation that it
is unwilling or unable to continue as Depositary or the Depositary has ceased to
be a clearing agency registered under the Exchange Act, and, in each case, a
successor Depositary is not appointed by the Corporation within 90 days after
the Corporation receives such notice or becomes aware of such condition, as the
case may be, the Corporation will execute, and the Debenture Trustee, upon
receipt of a Corporation Order, will authenticate and make available for
delivery the Definitive Securities, in authorized denominations, and in an
aggregate
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principal amount equal to the principal amount of the Global Security, in
exchange for such Global Security. If there is a Default or an Event of Default,
the Depositary shall have the right to exchange the Global Securities for
Definitive Securities. In addition, the Corporation may at any time determine
that the Securities shall no longer be represented by a Global Security. In the
event of such an Event of Default or such a determination, the Corporation shall
execute, and subject to Section 2.07, the Debenture Trustee, upon receipt of an
Officers' Certificate evidencing such determination by the Corporation and a
Corporation Order, will authenticate and make available for delivery the
Definitive Securities, in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the Global Security, in
exchange for such Global Security. Upon the exchange of the Global Security for
such Definitive Securities, in authorized denominations, the Global Security
shall be cancelled by the Debenture Trustee. Such Definitive Securities issued
in exchange for the Global Security shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions from
its direct or indirect participants or otherwise, shall instruct the Debenture
Trustee. The Debenture Trustee shall deliver such Definitive Securities to the
Depositary for delivery to the Persons in whose names such Definitive Securities
are so registered.
SECTION 2.06 Interest.
(a) Each Security will bear interest at the rate of 10.52% per annum
(the "Coupon Rate") from the most recent date to which interest has been paid or
duly provided for or, if no interest has been paid or duly provided for, from
May 1, 1997, until the principal thereof becomes due and payable, and at the
Coupon Rate on any overdue principal (and premium, if any) and (to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest, compounded semi-annually, payable (subject to
the provisions of Article XVI) semi-annually in arrears on May 1 and November 1
of each year, commencing on November 1, 1997 (each, an "Interest Payment Date"),
to the Person in whose name such Security or any predecessor Security is
registered, at the close of business on the regular record date for such
interest installment, which shall be the 15th day of the month next preceding
that in which the relevant Interest Payment Date falls.
(b) Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
(c) During such time as the Property Trustee is the holder of any
Securities, the Corporation shall pay any additional amounts on the Securities
as may be necessary in order that the amount of Distributions then due and
payable by the Trust on
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the outstanding Trust Securities shall not be reduced as a result of any
additional taxes, duties and other governmental charges to which the Trust has
become subject as a result of a Tax Event ("Additional Sums").
SECTION 2.07. Transfer and Exchange.
(a) Transfer Restrictions. (i) The Initial Securities, and those
Exchange Securities with respect to which any Person described in Section
2.04(b)(A), (B) or (C) is the beneficial owner, may not be transferred except in
compliance with the legend contained in Exhibit A unless otherwise determined by
the Corporation in accordance with applicable law. Upon any distribution of the
Securities following a Dissolution Event, the Corporation and the Debenture
Trustee shall enter into a supplemental indenture pursuant to Section 9.01 to
provide for the transfer restrictions and procedures with respect to the
Securities substantially similar to those contained in the Declaration to the
extent applicable in the circumstances existing at such time.
(ii) The Securities will be issued and may be transferred only
in blocks having an aggregate principal amount of not less than $100,000 and in
multiples of $1,000 in excess thereof. Any such transfer of the Securities in a
block having an aggregate principal amount of less than $100,000 shall be deemed
to be voided and of no legal effect whatsoever. Any such transferee shall be
deemed not to be a holder of such Securities for any purpose, including, but not
limited to the receipt of payments on such Securities, and such transferee shall
be deemed to have no interest whatsoever in such Securities.
(b) General Provisions Relating to Transfers and Exchanges. To
permit registrations of transfers and exchanges, the Corporation shall execute
and the Debenture Trustee shall authenticate Definitive Securities and Global
Securities at the request of the security registrar for the Securities. All
Definitive Securities and Global Securities issued upon any registration of
transfer or exchange of Definitive Securities or Global Securities shall be the
valid obligations of the Corporation, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Definitive Securities or Global
Securities surrendered upon such registration of transfer or exchange.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Corporation may require payment of a sum
sufficient to cover any transfer tax or similar governmental charge payable in
connection therewith.
The Corporation shall not be required to: (i) issue, register the
transfer of or exchange Securities during a period beginning at the opening of
business 15 days before the day of
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mailing of a notice of prepayment or any notice of selection of Securities for
prepayment under Article XIV hereof and ending at the close of business on the
day of such mailing; or (ii) register the transfer of or exchange any Security
so selected for prepayment in whole or in part, except the nonprepaid portion of
any Security being prepaid in part.
Prior to due presentment for the registration of a transfer of any
Security, the Debenture Trustee, the Corporation and any agent of the Debenture
Trustee or the Corporation may deem and treat the Person in whose name any
Security is registered as the absolute owner of such Security for the purpose of
receiving payment of principal of and premium, if any, and interest on such
Securities, and none of the Debenture Trustee, the Corporation and any agents of
the Debenture Trustee or the Corporation shall be affected by notice to the
contrary.
(c) Exchange of Initial Securities for Exchange Securities. The
Initial Securities may be exchanged for Exchange Securities pursuant to the
terms of the Exchange Offer. The Debenture Trustee shall make the exchange as
follows:
The Corporation shall present the Debenture Trustee with an
Officers' Certificate certifying the following:
(A) upon issuance of the Exchange Securities, the transactions
contemplated by the Exchange Offer have been consummated; and
(B) the principal amount of Initial Securities properly tendered
in the Exchange Offer that are represented by a Global
Security, the principal amount of Initial Securities properly
tendered in the Exchange Offer that are represented by
Definitive Securities, the name of each holder of such
Definitive Securities, the principal amount properly tendered
in the Exchange Offer by each such holder and the name and
address to which Definitive Securities for Exchange Securities
shall be registered and sent for each such holder.
The Debenture Trustee, upon receipt of (i) such Officers'
Certificate, (ii) an Opinion of Counsel (x) to the effect that the Exchange
Securities have been registered under Section 5 of the Securities Act and the
Indenture has been qualified under the Trust Indenture Act and (y) with respect
to the matters set forth in Section 3(q) of the Registration Rights Agreement
and (iii) a Corporation Order, shall authenticate (A) a Global Security
representing Exchange Securities in aggregate principal amount equal to the
aggregate principal amount of Initial Securities represented by a Global
Security indicated in such Officers' Certificate as having been properly
tendered and (B) Definitive
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Securities representing Exchange Securities registered in the names of, and in
the principal amounts indicated in, such Officers' Certificate.
If the principal amount of the Global Security for the Exchange
Securities is less than the principal amount of the Global Security for the
Initial Securities, the Debenture Trustee shall make an endorsement on such
Global Security for Initial Securities indicating a reduction in the principal
amount represented thereby.
The Debenture Trustee shall deliver such Definitive Securities
representing Exchange Securities to the holders thereof as indicated in such
Officers' Certificate.
SECTION 2.08. Replacement Securities.
If any mutilated Security is surrendered to the Debenture Trustee,
or the Corporation and the Debenture Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Security, the Corporation
shall issue and the Debenture Trustee shall authenticate a replacement Security
if the Debenture Trustee's requirements for replacements of Securities are met.
An indemnity bond must be supplied by the holder that is sufficient in the
judgment of the Debenture Trustee and the Corporation to protect the
Corporation, the Debenture Trustee, any agent thereof or any authenticating
agent from any loss that any of them may suffer if a Security is replaced. The
Corporation or the Debenture Trustee may charge for its expenses in replacing a
Security.
Every replacement Security is an obligation of the Corporation and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities duly issued hereunder.
SECTION 2.09. Temporary Securities.
Pending the preparation of Definitive Securities, the Corporation
may execute, and upon Corporation Order the Debenture Trustee shall authenticate
and make available for delivery, temporary Securities that are printed,
lithographed, typewritten, mimeographed or otherwise reproduced, in any
authorized denomination, substantially of the tenor of the Definitive Securities
in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the Officers executing such
Securities may determine, as conclusively evidenced by their execution of such
Securities.
If temporary Securities are issued, the Corporation shall cause
Definitive Securities to be prepared without unreasonable delay. The Definitive
Securities shall be printed,
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lithographed or engraved, or provided by any combination thereof, or in any
other manner permitted by the rules and regulations of any applicable securities
exchange, all as determined by the Officers executing such Definitive
Securities. After the preparation of Definitive Securities, the temporary
Securities shall be exchangeable for Definitive Securities upon surrender of the
temporary Securities at the office or agency maintained by the Corporation for
such purpose pursuant to Section 3.02 hereof, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Securities, the
Corporation shall execute, and the Debenture Trustee shall authenticate and make
available for delivery, in exchange therefor the same aggregate principal amount
of Definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as Definitive Securities.
SECTION 2.10. Cancellation.
The Corporation at any time may deliver Securities to the Debenture
Trustee for cancellation. The Debenture Trustee and no one else shall cancel all
Securities surrendered for registration of transfer, exchange, payment,
replacement or cancellation and shall retain or destroy cancelled Securities in
accordance with its normal practices (subject to the record retention
requirement of the Exchange Act) unless the Corporation directs them to be
returned to it. The Corporation may not issue new Securities to replace
Securities that have been prepaid or paid or that have been delivered to the
Debenture Trustee for cancellation.
SECTION 2.11. Defaulted Interest.
Any interest on any Security that is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the holder on the
relevant regular record date by virtue of having been such holder; and such
Defaulted Interest shall be paid by the Corporation, at its election, as
provided in clause (a) or clause (b) below:
(a) The Corporation may make payment of any Defaulted Interest on
Securities to the Persons in whose names such Securities (or their
respective Predecessor Securities) are registered at the close of business
on a special record date for the payment of such Defaulted Interest, which
shall be fixed in the following manner: the Corporation shall notify the
Debenture Trustee in writing of the amount of Defaulted Interest proposed
to be paid on each such Security and the date of the proposed payment, and
at the same time the Corporation shall deposit with the Debenture Trustee
an amount of money equal to the aggregate amount proposed to be
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paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Debenture 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 Debenture Trustee shall fix a special
record date for the payment of such Defaulted Interest which shall not be
more than 15 nor less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Debenture
Trustee of the notice of the proposed payment. The Debenture Trustee shall
promptly notify the Corporation of such special record date and, in the
name and at the expense of the Corporation, shall cause notice of the
proposed payment of such Defaulted Interest and the special record date
therefor to be mailed, first class postage prepaid, to each Securityholder
at his or her address as it appears in the Security Register, not less
than 10 days prior to such special record date. Notice of the proposed
payment of such Defaulted Interest and the special record date therefor
having been mailed as aforesaid, such Defaulted Interest shall be paid to
the Persons in whose names such Securities (or their respective
Predecessor Securities) are registered on such special record date and
shall be no longer payable pursuant to the following clause (b).
(b) The Corporation may make payment of any Defaulted Interest on
any Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Corporation to the Debenture Trustee of the
proposed payment pursuant to this clause, such manner of payment shall be
deemed practicable by the Debenture Trustee.
SECTION 2.12. CUSIP Numbers.
The Corporation in issuing the Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Debenture Trustee shall use "CUSIP"
numbers in notices of prepayment as a convenience to Securityholders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a prepayment and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such prepayment shall
not be affected by any defect in or omission of such numbers. The Corporation
will promptly notify the Debenture Trustee of any change in the CUSIP numbers.
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ARTICLE III
PARTICULAR COVENANTS OF THE CORPORATION
SECTION 3.01. Payment of Principal, Premium and Interest.
The Corporation covenants and agrees for the benefit of the holders
of the Securities that it will duly and punctually pay or cause to be paid the
principal of and premium, if any, and interest on the Securities at the place,
at the respective times and in the manner provided herein. The Corporation
further covenants to pay any and all amounts, including, without limitation,
Additional Sums, as may be required pursuant to Section 2.06(c), Liquidated
Damages, if any, on the dates and in the manner required under the Registration
Rights Agreement and Compounded Interest, as may be required pursuant to Section
16.01.
SECTION 3.02. Offices for Notices and Payments, etc.
So long as any of the Securities remain outstanding, the Corporation
will maintain in New York, New York an office or agency where the Securities may
be presented for payment, an office or agency where the Securities may be
presented for registration of transfer and for exchange as in this Indenture
provided and an office or agency where notices and demands to or upon the
Corporation in respect of the Securities or this Indenture may be served. The
Corporation will give to the Debenture Trustee written notice of the location of
any such office or agency and of any change of location thereof. Until otherwise
designated from time to time by the Corporation in a notice to the Debenture
Trustee, any such office or agency for all of the above purposes shall be the
Principal Office of the Debenture Trustee. In case the Corporation shall fail to
maintain any such office or agency in New York, New York or shall fail to give
such notice of the location or of any change in the location thereof,
presentations and demands may be made and notices may be served at the Principal
Office of the Debenture Trustee.
In addition to any such office or agency, the Corporation may from
time to time designate one or more offices or agencies outside New York, New
York, where the Securities may be presented for payment, for registration of
transfer and for exchange and where notices and demands to or upon the
Corporation in respect of the Securities or this Indenture may be served in the
manner provided in this Indenture, and the Corporation may from time to time
rescind such designation, as the Corporation may deem desirable or expedient;
provided, however, that no such designation or rescission shall in any manner
relieve the Corporation of its obligation to maintain any such office or agency
in New York, New York for the purposes above mentioned. The Corpo-
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ration will give to the Debenture Trustee prompt written notice of any such
designation or rescission thereof.
SECTION 3.03. Appointments to Fill Vacancies in Debenture Trustee's
Office.
The Corporation, whenever necessary to avoid or fill a vacancy in
the office of Debenture Trustee, will appoint, in the manner provided in Section
6.10, a Debenture Trustee, so that there shall at all times be a Debenture
Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent.
(a) If the Corporation shall appoint a paying agent other than the
Debenture Trustee with respect to the Securities, it will
cause such paying agent to execute and deliver to the
Debenture Trustee an instrument in which such agent shall
agree with the Debenture Trustee, subject to the provision of
this Section 3.04,
(1) that it will hold all sums held by it as such agent for
the payment of the principal of and premium, if any, or
interest on the Securities (whether such sums have been
paid to it by the Corporation or by any other obligor on
the Securities) in trust for the benefit of the holders
of the Securities; and
(2) that it will give the Debenture Trustee notice of any
failure by the Corporation (or by any other obligor on
the Securities) to make any payment of the principal of
and premium or interest (including Additional Sums and
Compounded Interest, if any) and Liquidated Damages, if
any, on the Securities when the same shall be due and
payable.
(b) If the Corporation shall act as its own paying agent, it will,
on or before each due date of the principal of and premium, if
any, or interest on the Securities, set aside, segregate and
hold in trust for the benefit of the holders of the Securities
a sum sufficient to pay such principal, premium or interest so
becoming due and will notify the Debenture Trustee of any
failure to take such action and of any failure by the
Corporation (or by any other obligor under the Securities) to
make any payment of the principal of and premium, if any, or
interest on the Securities when the same shall become due and
payable.
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(c) Anything in this Section 3.04 to the contrary notwithstanding,
the Corporation may, at any time, for the purpose of obtaining
a satisfaction and discharge with respect to the Securities
hereunder, or for any other reason, pay or cause to be paid to
the Debenture Trustee all sums held in trust for such
Securities by the Debenture Trustee or any paying agent
hereunder, as required by this Section 3.04, such sums to be
held by the Debenture Trustee upon the trusts herein
contained.
(d) Anything in this Section 3.04 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this
Section 3.04 is subject to Sections 11.03 and 11.04.
SECTION 3.05. Certificate to Debenture Trustee.
The Corporation will deliver to the Debenture Trustee on or before
120 days after the end of each fiscal year in each year, commencing with the
first fiscal year ending after the date hereof, so long as Securities are
outstanding hereunder, an Officers' Certificate, one of the signers of which
shall be the principal executive, principal financial or principal accounting
officer of the Corporation, stating that in the course of the performance by the
signers of their duties as officers of the Corporation they would normally have
knowledge of any Default by the Corporation in the performance of any covenants
contained herein, stating whether or not they have knowledge of any such Default
and, if so, specifying each such Default of which the signers have knowledge and
the nature thereof.
SECTION 3.06. Compliance with Consolidation Provisions.
The Corporation will not, while any of the Securities remain
outstanding, consolidate with, or merge into, or merge into itself, or sell or
convey all or substantially all of its property to any other Person unless the
provisions of Article X hereof are complied with.
SECTION 3.07. Limitation on Dividends.
The Corporation will not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Corporation's capital stock, (ii) make any payment
of principal of or premium, if any, or interest on or repay, repurchase or
redeem any debt securities of the Corporation (including Other Debentures) that
rank pari passu with or junior in right of payment to the Securities or (iii)
make any guarantee payments with respect to any guarantee (other than the
Capital Securities Guarantee) by the
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Corporation of the debt securities of any Subsidiary of the Corporation
(including Other Guarantees) if such guarantee ranks pari passu with or junior
in right of payment to the Securities (other than (a) dividends or distributions
in shares of, or options, warrants or rights to subscribe for or purchase shares
of, Common Stock, (b) any declaration of a dividend in connection with the
implementation of a stockholder's rights plan, or the issuance of stock under
any such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto, (c) as a result of a reclassification of the Corporation's
capital stock or the exchange or conversion of one class or series of the
Corporation's capital stock for another class or series of the Corporation's
capital stock, (d) the purchase of fractional interests in shares of the
Corporation's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged and (e)
purchases of Common Stock related to the issuance of Common Stock or rights
under any of the Corporation's benefit or compensation plans for its directors,
officers or employees or any of the Corporation's dividend reinvestment plans),
if at such time (1) there shall have occurred any event of which the Corporation
has actual knowledge that (a) is a Default or an Event of Default and (b) in
respect of which the Corporation shall not have taken reasonable steps to cure,
(2) if such Securities are held by the Property Trustee, the Corporation shall
be in default with respect to its payment of any obligations under the Capital
Securities Guarantee or (3) the Corporation shall have given notice of its
election to exercise its right to commence an Extended Interest Payment Period
and shall not have rescinded such notice, and such Extended Interest Payment
Period or any extension thereof shall have commenced and be continuing.
SECTION 3.08. Covenants as to Banknorth Capital Trust
In the event Securities are issued to the Trust or a trustee of such
trust in connection with the issuance of Trust Securities by the Trust, for so
long as such Trust Securities remain outstanding, the Corporation (i) will
maintain 100% direct or indirect ownership of the Common Securities of the
Trust; provided, however, that any successor of the Corporation, permitted
pursuant to Article X, may succeed to the Corporation's ownership of such Common
Securities, (ii) will use commercially reasonable efforts to cause the Trust (a)
to remain a business trust, except in connection with a distribution of
Securities to the holders of Trust Securities in liquidation of the Trust, the
redemption of all of the Trust Securities of the Trust, or certain mergers,
consolidations or amalgamations, each as permitted by the Declaration, and (b)
to otherwise continue to be classified as a grantor trust and not an association
taxable as a corporation for United States federal income tax purposes, (iii)
will use its reasonable efforts to cause each holder of the Trust Securities to
be treated as owning an undivided beneficial inter-
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est in the Securities and (iv) will not cause, as sponsor of the Trust, or
permit, as holder of the Common Securities, the dissolution, winding-up or
termination of the Trust, except as provided in the Declaration.
SECTION 3.09. Payment of Expenses.
In connection with the offering, sale and issuance of the Securities
to the Trust and in connection with the sale of the Trust Securities by the
Trust, the Corporation, in its capacity as borrower with respect to the
Securities, shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Securities, including commissions to the initial purchaser
payable pursuant to the Purchase Agreement, fees and expenses in connection with
any Exchange Offer, filing of a shelf registration statement or other action to
be taken pursuant to the Registration Rights Agreement and compensation of the
Debenture Trustee in accordance with the provisions of Section 6.06;
(b) pay all costs and expenses of the Trust (including, but not
limited to, costs and expenses relating to the organization of the Trust, the
offering, sale and issuance of the Trust Securities (including commissions to
the initial purchaser in connection therewith), the fees and expenses of the
Property Trustee and the Delaware Trustee, the costs and expenses relating to
the operation of the Trust, including without limitation, costs and expenses of
accountants, attorneys, statistical or bookkeeping services, expenses for
printing and engraving and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and telephone and other
telecommunications expenses and costs and expenses incurred in connection with
the acquisition, financing, and disposition of assets of the Trust;
(c) be primarily and fully liable for any indemnification
obligations arising with respect to the Declaration;
(d) pay any and all taxes (other than United States withholding
taxes attributable to the Trust or its assets) and all liabilities, costs and
expenses with respect to such taxes of the Trust; and
(e) pay all other fees, expenses, debts and obligations (other than
in respect of the Trust Securities) related to the Trust.
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SECTION 3.10. Payment Upon Resignation or Removal.
Upon termination of this Indenture or the removal or resignation of
the Debenture Trustee, unless otherwise stated, the Corporation shall pay to the
Debenture Trustee all amounts accrued and owing to the date of such termination,
removal or resignation. Upon termination of the Declaration or the removal or
resignation of the Delaware Trustee or the Property Trustee, as the case may be,
pursuant to Section 5.7 of the Declaration, the Corporation shall pay to the
Delaware Trustee or the Property Trustee, as the case may be, all amounts
accrued and owing to the date of such termination, removal or resignation.
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
CORPORATION AND THE DEBENTURE TRUSTEE
SECTION 4.01. Securityholders' Lists.
The Corporation covenants and agrees that it will furnish or cause
to be furnished to the Debenture Trustee:
(a) on a semi-annual basis on each regular record date for the
Securities, a list, in such form as the Debenture Trustee may
reasonably require, of the names and addresses of the
Securityholders as of such record date; and
(b) at such other times as the Debenture Trustee may request in
writing, within 30 days after the receipt by the Corporation,
of any such request, a list of similar form and content as of
a date not more than 15 days prior to the time such list is
furnished,
except that, no such lists need be furnished so long as the
Debenture Trustee is in possession thereof by reason of its acting
as security registrar for the Securities.
SECTION 4.02. Preservation and Disclosure of Lists.
(a) The Debenture Trustee shall preserve, in as current a form as
is reasonably practicable, all information as to the names and
addresses of the holders of the Securities (1) contained in
the most recent list furnished to it as provided in Section
4.01 or (2) received by it in the capacity of security
registrar (if so acting) hereunder. The Debenture Trustee may
destroy any list fur-
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nished to it as provided in Section 4.01 upon receipt of a new
list so furnished.
(b) In case three or more holders of Securities (hereinafter
referred to as "applicants") apply in writing to the Debenture
Trustee and furnish to the Debenture Trustee reasonable proof
that each such applicant has owned a Security for a period of
at least six months preceding the date of such application,
and such application states that the applicants desire to
communicate with other holders of Securities or with holders
of all Securities with respect to their rights under this
Indenture and is accompanied by a copy of the form of proxy or
other communication which such applicants propose to transmit,
then the Debenture Trustee shall within 5 Business Days after
the receipt of such application, at its election, either:
(1) afford such applicants access to the information
preserved at the time by the Debenture Trustee in
accordance with the provisions of subsection (a)
of this Section 4.02, or
(2) inform such applicants as to the approximate
number of holders of all Securities whose names
and addresses appear in the information preserved
at the time by the Debenture Trustee in accordance
with the provisions of subsection (a) of this
Section 4.02, and as to the approximate cost of
mailing to such Securityholders the form of proxy
or other communication, if any, specified in such
application.
If the Debenture Trustee shall elect not to afford such
applicants access to such information, the Debenture Trustee
shall, upon the written request of such applicants, mail to
each Securityholder whose name and address appear in the
information preserved at the time by the Debenture Trustee in
accordance with the provisions of subsection (a) of this
Section 4.02 a copy of the form of proxy or other
communication which is specified in such request with
reasonable promptness after a tender to the Debenture Trustee
of the material to be mailed and of payment, or provision for
the payment, of the reasonable expenses of mailing, unless
within five Business Days after
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such tender, the Debenture Trustee shall mail to such
applicants and file with the Commission, together with a copy
of the material to be mailed, a written statement to the
effect that, in the opinion of the Debenture Trustee, such
mailing would be contrary to the best interests of the holders
of Securities or would be in violation of applicable law. Such
written statement shall specify the basis of such opinion. If
the Commission, after opportunity for a hearing upon the
objections specified in the written statement so filed, shall
enter an order refusing to sustain any of such objections or
if, after the entry of an order sustaining one or more of such
objections, the Commission shall find, after notice and
opportunity for hearing, that all the objections so sustained
have been met and shall enter an order so declaring, the
Debenture Trustee shall mail copies of such material to all
such Securityholders with reasonable promptness after the
entry of such order and the renewal of such tender; otherwise
the Debenture Trustee shall be relieved of any obligation or
duty to such applicants respecting their application.
(c) Each and every holder of Securities, by receiving and holding
the same, agrees with the Corporation and the Debenture
Trustee that neither the Corporation nor the Debenture Trustee
nor any paying agent shall be held accountable by reason of
the disclosure of any such information as to the names and
addresses of the holders of Securities in accordance with the
provisions of subsection (b) of this Section 4.02, regardless
of the source from which such information was derived, and
that the Debenture Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made
under said subsection (b).
SECTION 4.03. Reports by the Corporation.
(a) The Corporation covenants and agrees to file with the
Debenture Trustee, within 15 days after the date on which the
Corporation is required to file the same with the Commission,
copies of the annual reports and of the information, documents
and other reports (or copies of such portions of any of the
foregoing as said Commission may from time to time by rules
and regulations prescribe) which the Corporation may be
required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Corporation is
not
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required to file information, documents or reports pursuant to
either of such sections, then to provide to the Debenture
Trustee, such of the supplementary and periodic information,
documents and reports which would have been required pursuant
to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may
be prescribed from time to time in such rules and regulations.
(b) The Corporation covenants and agrees to file with the
Debenture Trustee and the Commission, in accordance with the
rules and regulations prescribed from time to time by said
Commission, such additional information, documents and reports
with respect to compliance by the Corporation with the
conditions and covenants provided for in this Indenture as may
be required from time to time by such rules and regulations.
(c) The Corporation covenants and agrees to transmit by mail to
all holders of Securities, as the names and addresses of such
holders appear upon the Security Register, within 30 days
after the filing thereof with the Debenture Trustee, such
summaries of any information, documents and reports required
to be filed by the Corporation pursuant to subsections (a) and
(b) of this Section 4.03 as may be required by rules and
regulations prescribed from time to time by the Commission.
(d) Delivery of such reports, information and documents to the
Debenture Trustee is for informational purposes only and the
Debenture Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or
determinable from information contained therein, including the
Corporation's compliance with any of its covenants hereunder
(as to which the Debenture Trustee is entitled to rely
exclusively on Officers' Certificates).
(e) So long as is required for an offer or sale of the Securities
to qualify for an exemption under Rule 144A under the
Securities Act, the Corporation shall, upon request, provide
the information required by clause (d)(4) thereunder to each
Securityholder and to each beneficial owner and prospective
purchaser of Securities identified by each Securityholder of
Restricted Securities, unless such information is furnished to
the Com-
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mission pursuant to Section 13 or 15(d) of the Exchange Act.
SECTION 4.04. Reports by the Debenture Trustee.
(a) The Debenture Trustee shall transmit to Securityholders such
reports concerning the Debenture Trustee and its actions under
this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant
thereto. If required by Section 313(a) of the Trust Indenture
Act, the Debenture Trustee shall, within sixty days after each
November 1 following the date of this Indenture, commencing
November 1, 1998, deliver to Securityholders a brief report,
dated as of such November 1, which complies with the
provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Debenture
Trustee with each stock exchange, if any, upon which the
Securities are listed, with the Commission and with the
Corporation. The Corporation will promptly notify the
Debenture Trustee when the Securities are listed on any stock
exchange.
ARTICLE V
REMEDIES OF THE DEBENTURE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall constitute an
Event of Default hereunder (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) default in the payment of any interest (including Compounded
Interest and Additional Sums, if any) or Liquidated Damages,
if any, on the Securities or any Other Debentures when due,
and continuance of such default for a period of 30 days;
provided, however, that a valid extension of an interest
payment period by the Corporation in accordance with the terms
hereof or thereof shall not constitute a default in the
payment of interest for this purpose; or
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(b) default in the payment of any principal of (or premium, if
any, on) the Securities or any Other Debentures when due,
whether at maturity, upon prepayment, by declaration of
acceleration of maturity or otherwise; or
(c) default in the performance, or breach, of any covenant or
warranty of the Corporation in this Indenture (other than a
covenant or warranty a default in whose performance or whose
breach is elsewhere in this Section specifically dealt with),
and continuance of such default or breach for a period of 90
days after there has been given, by registered or certified
mail, to the Corporation by the Debenture Trustee or to the
Corporation and the Debenture Trustee by the holders of at
least 25% in aggregate principal amount of the outstanding
Securities a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice
is a "Notice of Default" hereunder; or
(d) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Corporation in an
involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or appointing
a receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Corporation or for
any substantial part of its property, or ordering the
winding-up or liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a period of 90
consecutive days; or
(e) the Corporation shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order
for relief in an involuntary case under any such law, or shall
consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) of the Corporation or
of any substantial part of its property, or shall make any
general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due.
If an Event of Default with respect to Securities at the time
outstanding occurs and is continuing, then in every such case the Debenture
Trustee or the holders of not less than 25% in
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aggregate principal amount of the Securities then outstanding may declare the
principal amount of all Securities to be due and payable immediately, by a
notice in writing to the Corporation (and to the Debenture Trustee if given by
the holders of the outstanding Securities), and upon any such declaration the
same shall become immediately due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Securities shall have been so
declared due and payable, and before any judgment or decree for the payment of
the moneys due shall have been obtained or entered as hereinafter provided, (i)
the Corporation shall pay or shall deposit with the Debenture Trustee a sum
sufficient to pay (A) all matured installments of interest (including Compounded
Interest and Additional Sums, if any) and Liquidated Damages, if any, on all the
Securities and the principal of and premium, if any, on any and all Securities
which shall have become due otherwise than by acceleration (with interest upon
such principal and premium, if any, and, to the extent that payment of such
interest is enforceable under applicable law, on overdue installments of
interest, at the same rate as the rate of interest specified in the Securities
to the date of such payment or deposit) and (B) such amount as shall be
sufficient to cover compensation due to the Debenture Trustee and each
predecessor Debenture Trustee, their respective agents, attorneys and counsel,
pursuant to Section 6.06, and (ii) any and all Events of Default under the
Indenture, other than the non-payment of the principal of the Securities which
shall have become due solely by such declaration of acceleration, shall have
been cured, waived or otherwise remedied as provided herein, then, in every such
case, the holders of a majority in aggregate principal amount of the Securities
then outstanding, by written notice to the Corporation and to the Debenture
Trustee, may rescind and annul such declaration and its consequences, but no
such waiver or rescission and annulment shall extend to or shall affect any
subsequent default or shall impair any right consequent thereon.
In case the Debenture Trustee shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been discontinued or
abandoned because of such rescission or annulment or for any other reason or
shall have been determined adversely to the Debenture Trustee, then and in every
such case the Corporation, the Debenture Trustee and the holders of the
Securities shall be restored respectively to their several positions and rights
hereunder, and all rights, remedies and powers of the Corporation, the Debenture
Trustee and the holders of the Securities shall continue as though no such
proceeding had been taken.
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SECTION 5.02. Payment of Securities on Default; Suit Therefor.
The Corporation covenants that (a) in case default shall be made in
the payment of any installment of interest (including Compounded Interest and
Additional Sums, if any) and Liquidated Damages, if any, on any of the
Securities as and when the same shall become due and payable, and such default
shall have continued for a period of 30 days, or (b) in case default shall be
made in the payment of the principal of or premium, if any, on any of the
Securities as and when the same shall have become due and payable, whether at
maturity of the Securities or upon prepayment or by declaration or otherwise,
then, upon demand of the Debenture Trustee, the Corporation will pay to the
Debenture Trustee, for the benefit of the holders of the Securities, the whole
amount that then shall have become due and payable on all such Securities for
principal and premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) and Liquidated Damages, if any, or both, as the case
may be, with interest upon the overdue principal and premium, if any, and (to
the extent that payment of such interest is enforceable under applicable law
and, if the Securities are held by the Trust or a trustee of such trust, without
duplication of any other amounts paid by the Trust or a trustee in respect
thereof) upon the overdue installments of interest (including Compounded
Interest and Additional Sums, if any) and Liquidated Damages, if any, at the
rate borne by the Securities; and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation to the Debenture Trustee, its agents, attorneys and
counsel, and any other amount due to the Debenture Trustee pursuant to Section
6.06.
In case the Corporation shall fail forthwith to pay such amounts
upon such demand, the Debenture Trustee, in its own name and as trustee of an
express trust, shall be entitled and empowered to institute any actions or
proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the
Corporation or any other obligor on the Securities and collect in the manner
provided by law out of the property of the Corporation or any other obligor on
the Securities, wherever situated, the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Corporation or any other obligor on the Securities
under Title 11, United States Code, or any other applicable law, or in case a
receiver or trustee shall have been appointed for the property of the
Corporation or such other obligor, or in the case of any other similar judicial
proceedings relative to the Corporation or other obligor
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upon the Securities, or to the creditors or property of the Corporation or such
other obligor, the Debenture Trustee, irrespective of whether the principal of
the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Debenture Trustee shall
have made any demand pursuant to the provisions of this Section 5.02, shall be
entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal and interest
owing and unpaid in respect of the Securities and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Debenture Trustee
(including any claim for amounts due to the Debenture Trustee pursuant to 6.06)
and of the Securityholders allowed in such judicial proceedings relative to the
Corporation or any other obligor on the Securities, or to the creditors or
property of the Corporation or such other obligor, unless prohibited by
applicable law and regulations, to vote on behalf of the holders of the
Securities in any election of a trustee or a standby trustee in arrangement,
reorganization, liquidation or other bankruptcy or insolvency proceedings or
person performing similar functions in comparable proceedings, and to collect
and receive any moneys or other property payable or deliverable on any such
claims, and to distribute the same after the deduction of its charges and
expenses; and any receiver, assignee or trustee in bankruptcy or reorganization
is hereby authorized by each of the Securityholders to make such payments to the
Debenture Trustee, and, in the event that the Debenture Trustee shall consent to
the making of such payments directly to the Securityholders, to pay to the
Debenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Debenture Trustee, each predecessor Debenture Trustee and
their respective agents, attorneys and counsel, and all other amounts due to the
Debenture Trustee pursuant to Section 6.06.
Nothing herein contained shall be construed to authorize the
Debenture Trustee to authorize or consent to or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any holder thereof or to
authorize the Debenture Trustee to vote in respect of the claim of any
Securityholder in any such proceeding.
All rights of action and of asserting claims under this Indenture,
or under any of the Securities, may be enforced by the Debenture Trustee without
the possession of any of the Securities, or the production thereof on any trial
or other proceeding relative thereto, and any such suit or proceeding instituted
by the Debenture Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall be for the ratable benefit of
the holders of the Securities.
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In any proceedings brought by the Debenture Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Debenture Trustee shall be a party), the Debenture Trustee shall be
held to represent all the holders of the Securities, and it shall not be
necessary to make any holders of the Securities parties to any such proceedings.
SECTION 5.03. Application of Moneys Collected by Debenture Trustee.
Any moneys collected by the Debenture Trustee shall be applied in
the following order, at the date or dates fixed by the Debenture Trustee for the
distribution of such moneys, upon presentation of the Securities in respect of
which moneys have been collected, and stamping thereon the payment, if only
partially paid, and upon surrender thereof if fully paid:
First: To the payment of costs and expenses of collection applicable
to the Securities and all other amounts due to the Debenture Trustee under
Section 6.06;
Second: To the payment of all Senior Indebtedness of the Corporation
if and to the extent required by Article XV;
Third: To the payment of the amounts then due and unpaid upon
Securities for principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if any,
on the Securities, in respect of which or for the benefit of which money has
been collected, ratably, without preference of priority of any kind, according
to the amounts due on such Securities for principal (and premium, if any) and
interest, respectively; and
Fourth: To the Corporation.
SECTION 5.04. Proceedings by Securityholders.
No holder of any Security shall have any right by virtue of or by
availing of any provision of this Indenture to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Indenture
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless such holder previously shall have given to the Debenture
Trustee written notice of an Event of Default and of the continuance thereof
with respect to the Securities specifying such Event of Default, as hereinbefore
provided, and unless also the holders of not less than 25% in aggregate
principal amount of the Securities then outstanding shall have made written
request upon the Debenture Trustee to institute such action, suit or proceeding
in its own name as Debenture Trustee hereunder and shall have offered to the
Debenture Trustee such reasonable indemnity as it
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may require against the costs, expenses and liabilities to be incurred therein
or thereby, and the Debenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity shall have failed to institute any such
action, suit or proceeding, it being understood and intended, and being
expressly covenanted by the taker and holder of every Security with every other
taker and holder and the Debenture Trustee, that no one or more holders of
Securities shall have any right in any manner whatever by virtue of or by
availing of any provision of this Indenture to affect, disturb or prejudice the
rights of any other holder of Securities, or to obtain or seek to obtain
priority over or preference to any other such holder, or to enforce any right
under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Securities.
Notwithstanding any other provisions in this Indenture, however, the
right of any holder of any Security to receive payment of the principal of (and
premium, if any) and interest on (including Compounded Interest and Additional
Sums, if any) and Liquidated Damages, if any, on such Security, on or after the
same shall have become due and payable, or to institute suit for the enforcement
of any such payment, shall not be impaired or affected without the consent of
such holder and by accepting a Security hereunder it is expressly understood,
intended and covenanted by the taker and holder of every Security with every
other such taker and holder and the Debenture Trustee, that no one or more
holders of Securities shall have any right in any manner whatsoever by virtue or
by availing of any provision of this Indenture to affect, disturb or prejudice
the rights of the holders of any other Securities, or to obtain or seek to
obtain priority over or preference to any other such holder, or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities. For the
protection and enforcement of the provisions of this Section, each and every
Securityholder and the Debenture Trustee shall be entitled to such relief as can
be given either at law or in equity.
The Corporation and the Debenture Trustee acknowledge that pursuant
to the Declaration, the holders of Capital Securities are entitled, in the
circumstances and subject to the limitations set forth therein, to commence a
Direct Action with respect to any Event of Default referred to in clause (a) or
(b) of Section 5.01.
SECTION 5.05. Proceedings by Debenture Trustee.
In case an Event of Default occurs with respect to Securities and is
continuing, the Debenture Trustee may in its discretion proceed to protect and
enforce the rights vested in it by this Indenture by such appropriate judicial
proceedings as the
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Debenture Trustee shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Debenture Trustee by this Indenture or by law.
SECTION 5.06. Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the Debenture
Trustee or to the Securityholders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any other powers and remedies available
to the Debenture Trustee or the holders of the Securities, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture or otherwise established
with respect to the Securities, and no delay or omission of the Debenture
Trustee or of any holder of any of the Securities to exercise any right or power
accruing upon any Event of Default occurring and continuing as aforesaid shall
impair any such right or power, or shall be construed to be a waiver of any such
default or an acquiescence therein; and, subject to the provisions of Section
5.04, every power and remedy given by this Article V or by law to the Debenture
Trustee or to the Securityholders may be exercised from time to time, and as
often as shall be deemed expedient, by the Debenture Trustee or by the
Securityholders.
SECTION 5.07. Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders.
The holders of a majority in aggregate principal amount of the
Securities at the time outstanding shall have the right to direct the time,
method, and place of conducting any proceeding for any remedy available to the
Debenture Trustee, or exercising any trust or power conferred on the Debenture
Trustee; provided, however, that (subject to the provisions of Section 6.01) the
Debenture Trustee shall have the right to decline to follow any such direction
if the Debenture Trustee shall determine that the action so directed would be
unjustly prejudicial to the holders not taking part in such direction or if the
Debenture Trustee being advised by counsel determines that the action or
proceeding so directed may not lawfully be taken or if the Debenture Trustee in
good faith by its board of directors or trustees, executive committee, or a
trust committee of directors or trustees and/or Responsible Officers shall
determine that the action or proceedings so directed would involve the Debenture
Trustee in personal liability. Prior to any declaration accelerating the
maturity of the Securities, the holders of a majority in aggregate principal
amount of the Securities at the time outstanding may on behalf of
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the holders of all of the Securities waive any past Default or Event of Default
and its consequences except a Default (a) in the payment of principal of (or
premium, if any,) or interest on (including Compounded Interest and Additional
Sums, if any) or Liquidated Damages, if any, on any of the Securities (unless
such default has been cured and a sum sufficient to pay all matured installments
of interest (including Compounded Interest and Additional Sums, if any) (and
premium, if any) and principal due otherwise than by acceleration has been
deposited with the Debenture Trustee) or (b) in respect of covenants or
provisions hereof which cannot be modified or amended without the consent of the
holder of each Security affected; provided, however, that if the Securities are
held by the Property Trustee, such waiver or modification to such waiver shall
not be effective until the holders of a majority in aggregate liquidation amount
of Trust Securities shall have consented to such waiver or modification to such
waiver; provided further, that if the consent of the holder of each outstanding
Security is required, such waiver shall not be effective until each holder of
the Trust Securities shall have consented to such waiver. Upon any such waiver,
the Default covered thereby shall be deemed to be cured for all purposes of this
Indenture and the Corporation, the Debenture Trustee and the holders of the
Securities shall be restored to their former positions and rights hereunder,
respectively; but no such waiver shall extend to any subsequent or other Default
or impair any right consequent thereon. Whenever any Default or Event of Default
hereunder shall have been waived as permitted by this Section 5.07, said Default
or Event of Default shall for all purposes of the Securities and this Indenture
be deemed to have been cured and to be not continuing.
SECTION 5.08. Notice of Defaults.
(a) The Debenture Trustee shall, within 90 days after the occurrence
of a Default with respect to the Securities actually known to a Responsible
Officer of the Debenture Trustee, mail to all Securityholders, as the names and
addresses of such holders appear upon the Security Register, notice of all
Defaults known to the Debenture Trustee, unless such Default shall have been
cured before the giving of such notice (the term "Default" for the purpose of
this Section 5.08 being hereby defined to be any of the events specified in
clauses (a), (b), (c), (d) and (e) of Section 5.01, not including periods of
grace, if any, provided for therein, and irrespective of the giving of written
notice specified in clause (c) of Section 5.01); and provided that, except in
the case of Default in the payment of the principal of (or premium, if any) or
interest (including Compounded Interest or Additional Sums, if any) or
Liquidated Damages, if any, on any of the Securities, the Debenture 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 Debenture Trustee in good faith
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determines that the withholding of such notice is in the interests of the
Securityholders; and provided further, that in the case of any Default of the
character specified in Section 5.01(c), no such notice to Securityholders shall
be given until at least 60 days after the occurrence thereof, but shall be given
within 90 days after such occurrence.
(b) Within ten Business Days after the occurrence of any Event of
Default actually known to a Responsible Officer of the Debenture Trustee, the
Debenture Trustee shall transmit notice of such Event of Default to all
Securityholders as their names and addresses appear on the Security Register,
unless such Event of Default shall have been cured or waived.
SECTION 5.09. Undertaking to Pay Costs.
All parties to this Indenture agree, and each holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Debenture Trustee for any
action taken or omitted by it as Debenture Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section 5.09 shall not apply to any
suit instituted by the Debenture Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the aggregate more than
10% in aggregate principal amount of the Securities outstanding, or to any suit
instituted by any Securityholder for the enforcement of the payment of the
principal of (or premium, if any) or interest (including Compounded Interest and
Additional Sums, if any) or Liquidated Damages, if any, on any Security against
the Corporation on or after the same shall have become due and payable.
ARTICLE VI
CONCERNING THE DEBENTURE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Debenture Trustee.
With respect to the holders of the Securities issued hereunder, the
Debenture Trustee, prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred, undertakes
to perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Event of Default has occurred (which has
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not been cured or waived), the Debenture 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.
No provision of this Indenture shall be construed to relieve the
Debenture Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have
occurred,
(1) the duties and obligations of the Debenture Trustee
shall be determined solely by the express provisions of
this Indenture, and the Debenture Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall
be read into this Indenture against the Debenture
Trustee; and
(2) in the absence of bad faith on the part of the Debenture
Trustee, the Debenture 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 Debenture Trustee and
conforming to the requirements of this Indenture; but,
in the case of any such certificates or opinions which
by any provision hereof are specifically required to be
furnished to the Debenture Trustee, the Debenture
Trustee shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Indenture;
(b) the Debenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or
Responsible Officers, unless it shall be proved that the
Debenture Trustee was negligent in ascertaining the pertinent
facts; and
(c) the Debenture Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in
accordance with the direction of the Securityholders pursuant
to Section 5.07, relating to the time, method and place of
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conducting any proceeding for any remedy available to the
Debenture Trustee, or exercising any trust or power conferred
upon the Debenture Trustee, under this Indenture.
None of the provisions contained in this Indenture shall require the
Debenture Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or liability is not reasonably assured to it under
the terms of this Indenture or adequate indemnity against such risk is not
reasonably assured to it.
SECTION 6.02. Reliance on Documents, Opinions, etc.
Except as otherwise provided in Section 6.01:
(a) the Debenture Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, consent, order, bond, note, debenture or other paper
or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Corporation
mentioned herein may be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be
herein specifically prescribed); and any Board Resolution may
be evidenced to the Debenture Trustee by a copy thereof
certified by the Secretary or an Assistant Secretary of the
Corporation;
(c) the Debenture Trustee may consult with counsel of its
selection and any advice or Opinion of Counsel shall be full
and complete authorization and protection in respect of any
action taken or suffered omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(d) the Debenture Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at
the request, order or direction of any of the Securityholders,
pursuant to the provisions of this Indenture, unless such
Securityholders shall have offered to the Debenture Trustee
reasonable and sufficient security or indemnity against the
costs, expenses and liabilities which may be incurred therein
or thereby;
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(e) the Debenture Trustee shall not be liable for any action taken
or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers
conferred upon it by this Indenture; nothing contained herein
shall, however, relieve the Debenture Trustee of the
obligation, upon the occurrence of an Event of Default (that
has not been cured or waived), to exercise such of the rights
and powers vested in it by this Indenture, and to use the same
degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct
of his own affairs;
(f) the Debenture Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond,
debenture, coupon or other paper or document, unless requested
in writing to do so by the holders of a majority in aggregate
principal amount of the outstanding Securities; provided,
however, that if the payment within a reasonable time to the
Debenture Trustee of the costs, expenses or liabilities likely
to be incurred by it in the making of such investigation is,
in the opinion of the Debenture Trustee, not reasonably
assured to the Debenture Trustee by the security afforded to
it by the terms of this Indenture, the Debenture Trustee may
require reasonable indemnity against such expense or liability
as a condition to so proceeding;
(g) the Debenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents (including any Authenticating Agent) or
attorneys, and the Debenture Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent
or attorney appointed by it with due care;
(h) the Debenture Trustee shall not be charged with knowledge of
any Default or Event of Default with respect to the Securities
unless (1) such Default or Event of Default falls within
Section 5.01(a) (other than a default with respect to the
payment of Compounded Interest, Liquidated Damages or
Additional Sums) or 5.01(b) of the Indenture, (2) a
Responsible Officer shall have actual knowledge of such
Default or Event of Default or (3) written notice of such
Default or Event of Default shall
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have been given to the Debenture Trustee by the Corporation or
any other obligor on the Securities or by any holder of the
Securities; and
(i) the Debenture Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith, without
negligence or willful misconduct and believed by it to be
authorized or within the discretion or rights or powers
conferred upon it by this Indenture.
SECTION 6.03. No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities (except in the
certificate of authentication of the Debenture Trustee or the Authenticating
Agent) shall be taken as the statements of the Corporation, and the Debenture
Trustee and the Authenticating Agent assume no responsibility for the
correctness of the same. The Debenture Trustee and the Authenticating Agent make
no representations as to the validity or sufficiency of this Indenture or of the
Securities. The Debenture Trustee and the Authenticating Agent shall not be
accountable for the use or application by the Corporation of any Securities or
the proceeds of any Securities authenticated and delivered by the Debenture
Trustee or the Authenticating Agent in conformity with the provisions of this
Indenture.
SECTION 6.04. Debenture Trustee, Authenticating Agent, Paying
Agents, Transfer Agents or Registrar May Own
Securities.
The Debenture Trustee or any Authenticating Agent or any paying
agent or any transfer agent or any security registrar for the Securities, in its
individual or any other capacity, may become the owner or pledgee of Securities
with the same rights it would have if it were not Debenture Trustee,
Authenticating Agent, paying agent, transfer agent or security registrar for the
Securities.
SECTION 6.05. Moneys to be Held in Trust.
Subject to the provisions of Section 11.04, all moneys received by
the Debenture Trustee or any paying agent shall, until used or applied as herein
provided, be held in trust for the purpose for which they were received, but
need not be segregated from other funds except to the extent required by law.
The Debenture Trustee and any paying agent shall be under no liability for
interest on any money received by it hereunder except as otherwise agreed in
writing with the Corporation. So long as no Event of Default shall have occurred
and be continuing, all interest allowed on any such moneys shall be paid from
time to
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time upon the written order of the Corporation, signed by an Officer thereof.
SECTION 6.06. Compensation and Expenses of Debenture Trustee.
The Corporation, as issuer of Securities under this Indenture,
covenants and agrees to pay to the Debenture Trustee from time to time, and the
Debenture Trustee shall be entitled to, such compensation as shall be agreed to
in writing between the Corporation and the Debenture Trustee (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust), and the Corporation will pay or reimburse the Debenture Trustee
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Debenture Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ), except any such expense, disbursement or advance as may arise from
its negligence or bad faith. The Corporation also covenants to indemnify each of
the Debenture Trustee or any predecessor Debenture Trustee (and its officers,
agents, directors and employees) for, and to hold it harmless against, any and
all loss, damage, claim, liability or expense including taxes (other than taxes
based on the income of the Debenture Trustee) incurred without negligence or bad
faith on the part of the Debenture Trustee and arising out of or in connection
with the acceptance or administration of this trust, including the costs and
expenses of defending itself against any claim of liability in the premises. The
obligations of the Corporation under this Section 6.06 to compensate and
indemnify the Debenture Trustee and to pay or reimburse the Debenture Trustee
for expenses, disbursements and advances shall constitute additional
indebtedness hereunder. Such additional indebtedness shall be secured by a lien
prior to that of the Securities upon all property and funds held or collected by
the Debenture Trustee as such, except funds held in trust for the benefit of the
holders of particular Securities.
When the Debenture Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(d) or Section
5.01(e), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for its services are intended to constitute
expenses of administration under any applicable federal or state bankruptcy,
insolvency or other similar law.
The provisions of this Section shall survive the resignation or
removal of the Debenture Trustee and the defeasance or other termination of this
Indenture.
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SECTION 6.07. Officers' Certificate as Evidence.
Except as otherwise provided in Sections 6.01 and 6.02, whenever in
the administration of the provisions of this Indenture the Debenture Trustee
shall deem it necessary or desirable that a matter be proved or established
prior to taking or omitting any action hereunder, such matter (unless other
evidence in respect thereof is herein specifically prescribed) may, in the
absence of negligence or bad faith on the part of the Debenture Trustee, be
deemed to be conclusively proved and established by an Officers' Certificate
delivered to the Debenture Trustee, and such Officers' Certificate, in the
absence of negligence or bad faith on the part of the Debenture Trustee, shall
be full warrant to the Debenture Trustee for any action taken or omitted by it
under the provisions of this Indenture upon the faith thereof.
SECTION 6.08. Conflicting Interest of Debenture Trustee.
If the Debenture Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Debenture Trustee and the Corporation shall in all respects comply with the
provisions of Section 310(b) of the Trust Indenture Act.
SECTION 6.09. Eligibility of Debenture Trustee.
The Debenture Trustee hereunder shall at all times be a corporation
organized and doing business under the laws of the United States of America or
any state or territory thereof or of the District of Columbia, or a corporation
or other Person permitted to act as trustee by the Commission authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000) and subject to
supervision or examination by federal, state, territorial, or District of
Columbia authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 6.09 the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published.
The Corporation may not, nor may any Person directly or indirectly
controlling, controlled by, or under common control with the Corporation, serve
as Debenture Trustee.
In case at any time the Debenture Trustee shall cease to be eligible
in accordance with the provisions of this Section 6.09, the Debenture Trustee
shall resign immediately in the manner and with the effect specified in Section
6.10.
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SECTION 6.10. Resignation or Removal of Debenture Trustee.
(a) The Debenture Trustee, or any trustee or trustees hereafter
appointed, may at any time resign by giving written notice of
such resignation to the Corporation and by mailing notice
thereof to the holders of the Securities at their addresses as
they shall appear on the Security register. Upon receiving
such notice of resignation, the Corporation shall promptly
appoint a successor trustee or trustees by written instrument,
in duplicate, one copy of which instrument shall be delivered
to the resigning Debenture Trustee and one copy to the
successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 60 days after
the mailing of such notice of resignation to the affected
Securityholders, the resigning Debenture Trustee may petition
any court of competent jurisdiction for the appointment of a
successor trustee, or any Securityholder who has been a bona
fide holder of a Security for at least six months may, subject
to the provisions of Section 5.09, on behalf of himself and
all others similarly situated, petition any such court for the
appointment of a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Debenture Trustee shall fail to comply with the
provisions of Section 6.08 after written request
therefor by the Corporation or by any Securityholder who
has been a bona fide holder of a Security or Securities
for at least six months, or
(2) the Debenture Trustee shall cease to be eligible in
accordance with the provisions of Section 6.09 and shall
fail to resign after written request therefor by the
Corporation or by any such Securityholder, or
(3) the Debenture Trustee shall become incapable of acting,
or shall be adjudged a bankrupt or insolvent, or a
receiver of the Debenture Trustee or of its property
shall be appointed, or any public officer shall take
charge or control of the Debenture Trustee or of its
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property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, the Corporation may remove the
Debenture Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which instrument shall
be delivered to the Debenture Trustee so removed and one copy
to the successor trustee, or, subject to the provisions of
Section 5.09, any Securityholder who has been a bona fide
holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Debenture
Trustee and the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem
proper and prescribe, remove the Debenture Trustee and appoint
a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the
Debenture Trustee and nominate a successor trustee, which
shall be deemed appointed as successor trustee unless within
10 days after written notification of such nomination the
Corporation objects thereto, or if no successor trustee shall
have been so appointed and shall have accepted appointment
within 30 days after such removal, in which case the Debenture
Trustee so removed or any Securityholder, upon the terms and
conditions and otherwise as in subsection (a) of this Section
6.10 provided, may petition any court of competent
jurisdiction for an appointment of a successor trustee.
(d) Any resignation or removal of the Debenture Trustee and
appointment of a successor trustee pursuant to any of the
provisions of this Section 6.10 shall become effective upon
acceptance of appointment by the successor trustee as provided
in Section 6.11.
SECTION 6.11. Acceptance by Successor Debenture Trustee.
Any successor trustee appointed as provided in Section 6.10 shall
execute, acknowledge and deliver to the Corporation and to its predecessor
trustee an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the retiring trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall
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become vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as trustee
herein; but, nevertheless, on the written request of the Corporation or of the
successor trustee, the trustee ceasing to act shall, upon payment of any amounts
then due it pursuant to the provisions of Section 6.06, execute and deliver an
instrument transferring to such successor trustee all the rights and powers of
the trustee so ceasing to act and shall duly assign, transfer and deliver to
such successor trustee all property and money held by such retiring trustee
thereunder. Upon request of any such successor trustee, the Corporation shall
execute any and all instruments in writing for more fully and certainly vesting
in and confirming to such successor trustee all such rights and powers. Any
trustee ceasing to act shall, nevertheless, retain a lien upon all property or
funds held or collected by such trustee to secure any amounts then due it
pursuant to the provisions of Section 6.06.
No successor trustee shall accept appointment as provided in this
Section 6.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 6.08 and eligible under the
provisions of Section 6.09.
Upon acceptance of appointment by a successor trustee as provided in
this Section 6.11, the Corporation shall mail notice of the succession of such
trustee hereunder to the holders of Securities at their addresses as they shall
appear on the Security register. If the Corporation fails to mail such notice
within 10 days after the acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the
Corporation.
SECTION 6.12. Succession by Merger, etc.
Any corporation into which the Debenture Trustee may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Debenture Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Debenture Trustee, shall be the successor of the Debenture
Trustee hereunder without the execution or filing of any paper or any further
act on the part of any of the parties hereto.
In case at the time such successor to the Debenture Trustee shall
succeed to the trusts created by this Indenture any Securities shall have been
authenticated but not delivered, any such successor to the Debenture Trustee may
adopt the certificate of authentication of any predecessor trustee, and deliver
such Securities so authenticated; and in case at that time any of the Securities
shall not have been authenticated, any successor to the Debenture Trustee may
authenticate such Securities either in
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the name of any predecessor hereunder or in the name of the successor trustee;
and in all such cases such certificates shall have the full force which the
Securities or this Indenture elsewhere provides that the certificate of the
Debenture Trustee shall have; provided, however, that the right to adopt the
certificate of authentication of any predecessor Debenture Trustee or
authenticate Securities in the name of any predecessor Debenture Trustee shall
apply only to its successor or successors by merger or consolidation.
SECTION 6.13. Limitation on Rights of Debenture Trustee as a
Creditor.
The Debenture Trustee shall comply with Section 311(a) of the Trust
Indenture Act, excluding any creditor relationship described in Section 311(b)
of the Trust Indenture Act. A Debenture Trustee who has resigned or been removed
shall be subject to Section 311(a) of the Trust Indenture Act to the extent
included therein.
SECTION 6.14. Authenticating Agents.
There may be one or more Authenticating Agents appointed by the
Debenture Trustee upon the request of the Corporation with power to act on its
behalf and subject to its direction in the authentication and delivery of
Securities issued upon exchange or transfer thereof as fully to all intents and
purposes as though any such Authenticating Agent had been expressly authorized
to authenticate and deliver Securities; provided, that the Debenture Trustee
shall have no liability to the Corporation for any acts or omissions of the
Authenticating Agent with respect to the authentication and delivery of
Securities. Any such Authenticating Agent shall at all times be a corporation
organized and doing business under the laws of the United States or of any state
or territory thereof or of the District of Columbia authorized under such laws
to act as Authenticating Agent, having a combined capital and surplus of at
least $5,000,000 and being subject to supervision or examination by federal,
state, territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually pursuant to law or the
requirements of such authority, then for the purposes of this Section 6.14 the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect herein specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which any
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Authenticating Agent shall be a party, or any corporation succeeding to the
corporate trust business of any Authenticating Agent, shall be the successor of
such Authenticating Agent hereunder, if such successor corporation is otherwise
eligible under this Section 6.14 without the execution or filing of any paper or
any further act on the part of the parties hereto or such Authenticating Agent.
Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Debenture Trustee and to the Corporation. The
Debenture Trustee may at any time terminate the agency of any Authenticating
Agent by giving written notice of termination to such Authenticating Agent and
to the Corporation. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible under this Section 6.14, the Debenture Trustee may, and upon the
request of the Corporation shall, promptly appoint a successor Authenticating
Agent eligible under this Section 6.14, shall give written notice of such
appointment to the Corporation and shall mail notice of such appointment to all
Securityholders as the names and addresses of such holders appear on the
Security Register. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all rights, powers, duties and
responsibilities of its predecessor hereunder, with like effect as if originally
named as Authenticating Agent herein.
The Corporation, as issuer of the Securities, agrees to pay to any
Authenticating Agent from time to time reasonable compensation for its services.
Any Authenticating Agent shall have no responsibility or liability for any
action taken by it as such in accordance with the directions of the Debenture
Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.
Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Securities may take
any action (including the making of any demand or request, the giving of any
notice, consent or waiver or the taking of any other action), the fact that at
the time of taking any such action the holders of such specified percentage have
joined therein may be evidenced (a) by any instrument (including by way of
electronic transmission) or any number of instruments of similar tenor executed
by such Securityholders in person or by agent or proxy appointed in writing, or
(b) by the record of such holders of Securities voting in favor thereof at any
meeting of such Securityholders
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duly called and held in accordance with the provisions of Article VIII, or (c)
by a combination of such instrument or instruments and any such record of such a
meeting of such Securityholders.
If the Corporation shall solicit from the Securityholders any
request, demand, authorization, direction, notice, consent, waiver or other
action, the Corporation may, at its option, as evidenced by an Officers'
Certificate, fix in advance a record date for the determination of
Securityholders entitled to give such request, demand, authorization, direction,
notice, consent, waiver or other action, but the Corporation shall have no
obligation to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other action may be given
before or after the record date, but only the Securityholders of record at the
close of business on the record date shall be deemed to be Securityholders for
the purposes of determining whether Securityholders of the requisite proportion
of outstanding Securities have authorized or agreed or consented to such
request, demand, authorization, direction, notice, consent, waiver or other
action, and for that purpose the outstanding Securities shall be computed as of
the record date; provided, however, that no such authorization, agreement or
consent by such Securityholders on the record date shall be deemed effective
unless it shall become effective pursuant to the provisions of this Indenture
not later than six months after the record date.
SECTION 7.02. Proof of Execution by Securityholders.
Subject to the provisions of Section 6.01, 6.02 and 8.05, proof of
the execution of any instrument by a Securityholder or his agent or proxy shall
be sufficient if made in accordance with such reasonable rules and regulations
as may be prescribed by the Debenture Trustee or in such manner as shall be
satisfactory to the Debenture Trustee. The ownership of Securities shall be
proved by the Security Register or by a certificate of the security registrar
for the Securities. The Debenture Trustee may require such additional proof of
any matter referred to in this Section as it shall deem necessary.
The record of any Securityholders' meeting shall be proved in the
manner provided in Section 8.06.
SECTION 7.03. Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer of any
Security, the Corporation, the Debenture Trustee, any Authenticating Agent, any
paying agent, any transfer agent and any security registrar for the Securities
may deem the person in whose name such Security shall be registered upon the
Security Register to be, and may treat him as, the absolute owner of such
Security (whether or not such Security shall be overdue) for the
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purpose of receiving payment of or on account of the principal of and premium,
if any, and (subject to Section 2.06) interest on such Security and for all
other purposes; and neither the Corporation nor the Debenture Trustee nor any
Authenticating Agent nor any paying agent nor any transfer agent nor any
security registrar for the Securities shall be affected by any notice to the
contrary. All such payments so made to any holder for the time being or upon his
order shall be valid and, to the extent of the sum or sums so paid, effectual to
satisfy and discharge the liability for moneys payable upon any such Security.
SECTION 7.04. Securities Owned by Corporation Deemed Not
Outstanding.
In determining whether the holders of the requisite aggregate
principal amount of Securities have concurred in any direction, consent or
waiver under this Indenture, Securities which are owned by the Corporation or
any other obligor on the Securities or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Corporation or any other obligor on the Securities shall be disregarded and
deemed not to be outstanding for the purpose of any such determination; provided
that for the purposes of determining whether the Debenture Trustee shall be
protected in relying on any such direction, consent or waiver, only Securities
which a Responsible Officer of the Debenture Trustee actually knows are so owned
shall be so disregarded. Securities so owned which have been pledged in good
faith may be regarded as outstanding for the purposes of this Section 7.04 if
the pledgee shall establish to the satisfaction of the Debenture Trustee the
pledgee's right to vote such Securities and that the pledgee is not the
Corporation or any such other obligor or Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Corporation or any such other obligor. In the case of a dispute as to such
right, any decision by the Debenture Trustee taken upon the advice of counsel
shall be full protection to the Debenture Trustee.
SECTION 7.05. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the Debenture
Trustee, as provided in Section 7.01, of the taking of any action by the holders
of the percentage in aggregate principal amount of the Securities specified in
this Indenture in connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution therefor),
subject to Section 7.01, the serial number of which is shown by the evidence to
be included in the group of Securities the holders of which have consented to
such action, may, by filing written notice with the Debenture Trustee at its
principal office and upon proof of holding as provided in Section 7.02,
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revoke such action so far as concerns such Security (or so far as concerns the
principal amount represented by any exchanged or substituted Security). Except
as aforesaid, any such action taken by the holder of any Security shall be
conclusive and binding upon such holder and upon all future holders and owners
of such Security, and of any Security issued in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon such Security or any Security issued in exchange or substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings.
A meeting of Securityholders may be called at any time and from time
to time pursuant to the provisions of this Article VIII for any of the following
purposes:
(a) to give any notice to the Corporation or to the Debenture
Trustee, or to give any directions to the Debenture Trustee,
or to consent to the waiving of any Default hereunder and its
consequences, or to take any other action authorized to be
taken by Securityholders pursuant to any of the provisions of
Article V;
(b) to remove the Debenture Trustee and nominate a successor
trustee pursuant to the provisions of Article VI;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section
9.02; or
(d) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal
amount of such Securities under any other provision of this
Indenture or under applicable law.
SECTION 8.02. Call of Meetings by Debenture Trustee.
The Debenture Trustee may at any time call a meeting of
Securityholders to take any action specified in Section 8.01, to be held at such
time and at such place in New York, New York, as the Debenture Trustee shall
determine. Notice of every meeting of the Securityholders, setting forth the
time and the place of such meeting and in general terms the action proposed to
be taken at such meeting, shall be mailed to holders of Securities at
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their addresses as they shall appear on the Securities Register. Such notice
shall be mailed not less than 20 nor more than 180 days prior to the date fixed
for the meeting.
SECTION 8.03. Call of Meetings by Corporation or Securityholders.
In case at any time the Corporation, pursuant to a resolution of the
Board of Directors, or the holders of at least 10% in aggregate principal amount
of the Securities then outstanding, shall have requested the Debenture Trustee
to call a meeting of Securityholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Debenture Trustee shall not have mailed the notice of such meeting within 20
days after receipt of such request, then the Corporation or such Securityholders
may determine the time and the place in New York, New York for such meeting and
may call such meeting to take any action authorized in Section 8.01, by mailing
notice thereof as provided in Section 8.02.
SECTION 8.04. Qualifications for Voting.
To be entitled to vote at any meeting of Securityholders, a Person
shall be (a) a holder of one or more Securities or (b) a Person appointed by an
instrument in writing as proxy by a holder of one or more Securities. The only
Persons who shall be entitled to be present or to speak at any meeting of
Securityholders shall be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Debenture Trustee and its counsel and any
representatives of the Corporation and its counsel.
SECTION 8.05. Regulations.
Notwithstanding any other provisions of this Indenture, the
Debenture Trustee may make such reasonable regulations as it may deem advisable
for any meeting of Securityholders, in regard to proof of the holding of
Securities and of the appointment of proxies, and in regard to the appointment
and duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall think fit.
The Debenture Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have been called by
the Corporation or by Securityholders as provided in Section 8.03, in which case
the Corporation or the Securityholders calling the meeting, as the case may be,
shall in like manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by majority vote of the
meeting.
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Subject to the provisions of Section 8.04, at any meeting each
holder of Securities or proxy therefor shall be entitled to one vote for each
$1,000 principal amount of Securities held or represented by him; provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Security challenged as not outstanding and ruled by the chairman of the meeting
to be not outstanding. The chairman of the meeting shall have no right to vote
other than by virtue of Securities held by him or instruments in writing as
aforesaid duly designating him as the person to vote on behalf of other
Securityholders. Any meeting of Securityholders duly called pursuant to the
provisions of Section 8.02 or 8.03 may be adjourned from time to time by a
majority of those present, and the meeting may be held as so adjourned without
further notice.
SECTION 8.06. Voting.
The vote upon any resolution submitted to any meeting of holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of such holders or of their representatives by proxy and the serial
number or numbers of the Securities held or represented by them. The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
triplicate of all votes cast at the meeting. A record in duplicate of the
proceedings of each meeting of Securityholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice was mailed as
provided in Section 8.02. The record shall show the serial numbers of the
Securities voting in favor of or against any resolution. The record shall be
signed and verified by the affidavits of the permanent chairman and secretary of
the meeting and one of the duplicates shall be delivered to the Corporation and
the other to the Debenture Trustee to be preserved by the Debenture Trustee, the
latter to have attached thereto the ballots voted at the meeting. The holders of
the Initial Securities and the Exchange Securities shall vote for all purposes
as a single class.
Any record so signed and verified shall be conclusive evidence of
the matters therein stated.
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ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.
The Corporation and the Debenture Trustee may from time to time and
at any time amend this Indenture, without the consent of the Securityholders,
for one or more of the following purposes:
(a) to evidence the succession of another Person to the
Corporation, or successive successions, and the assumption by
the successor Person of the covenants, agreements and
obligations of the Corporation pursuant to Article X hereof;
(b) to add to the covenants of the Corporation such further
covenants, restrictions or conditions for the protection of
the Securityholders as the Board of Directors and the
Debenture Trustee shall consider to be for the protection of
the Securityholders, and to make the occurrence, or the
occurrence and continuance, of a default in any of such
additional covenants, restrictions or conditions a Default or
an Event of Default permitting the enforcement of all or any
of the remedies provided in this Indenture as herein set
forth; provided, however, that in respect of any such
additional covenant, restriction or condition such amendment
may provide for a particular period of grace after default
(which period may be shorter or longer than that allowed in
the case of other defaults) or may provide for an immediate
enforcement upon such default or may limit the remedies
available to the Debenture Trustee upon such default;
(c) to provide for the issuance under this Indenture of Securities
in coupon form (including Securities registrable as to
principal only) and to provide for exchangeability of such
Securities with the Securities issued hereunder in fully
registered form and to make all appropriate changes for such
purpose;
(d) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture
which may be defective or inconsistent with any other
provision contained herein or in any supplemental indenture;
or to make such other provisions in regard to matters or
questions
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arising under this Indenture, provided that any such action
shall not materially adversely affect the interests of the
holders of the Securities;
(e) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the
Securities;
(f) to make provision for transfer procedures, certification,
book-entry provisions, the form of restricted securities
legends, if any, to be placed on Securities, and all other
matters required pursuant to Section 2.07 or otherwise
necessary, desirable or appropriate in connection with the
issuance of Securities to holders of Capital Securities in the
event of a distribution of Securities by the Trust following a
Dissolution Event, provided that any such action shall not
materially adversely affect the interests of the holders of
the Securities;
(g) to qualify or maintain qualification of this Indenture under
the Trust Indenture Act; or
(h) to make any change that does not adversely affect the rights
of any Securityholder in any material respect.
The Debenture Trustee is hereby authorized to join with the
Corporation in the execution of any supplemental indenture to effect such
amendment, to make any further appropriate agreements and stipulations which may
be therein contained and to accept the conveyance, transfer and assignment of
any property thereunder, but the Debenture Trustee shall not be obligated to,
but may in its discretion, enter into any such supplemental indenture which
affects the Debenture Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any amendment to this Indenture authorized by the provisions of this
Section 9.01 may be executed by the Corporation and the Debenture Trustee
without the consent of the holders of any of the Securities at the time
outstanding, notwithstanding any of the provisions of Section 9.02.
SECTION 9.02. With Consent of Securityholders.
With the consent (evidenced as provided in Section 7.01) of the
holders of a majority in aggregate principal amount of the Securities at the
time outstanding, the Corporation, when authorized by a Board Resolution, and
the Debenture Trustee may from time to time and at any time amend this Indenture
for the purpose of adding any provisions to or changing in any manner or
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eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the holders of the Securities; provided, however, that no
such amendment shall, without the consent of the holders of each Security then
outstanding and affected thereby (i) change the Maturity Date of any Security,
or reduce the rate or extend the time of payment of interest thereon (except as
contemplated by Article XVI), or reduce the principal amount thereof, or reduce
any amount payable on prepayment thereof, or make the principal thereof or any
interest or premium thereon payable in any coin or currency other than that
provided in the Securities, or impair or affect the right of any Securityholder
to institute suit for payment thereof, or (ii) reduce the aforesaid percentage
of Securities, the holders of which are required to consent to any such
amendment to the Indenture; provided, however, that if the Securities are held
by the Trust, such amendment shall not be effective until the holders of a
majority in liquidation amount of Trust Securities shall have consented to such
amendment; provided, further, that if the consent of the holder of each
outstanding Security is required, such amendment shall not be effective until
each holder of the Trust Securities shall have consented to such amendment.
Upon the request of the Corporation accompanied by a copy of a
resolution of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any supplemental indenture affecting such
amendment, and upon the filing with the Debenture Trustee of evidence of the
consent of Securityholders as aforesaid, the Debenture Trustee shall join with
the Corporation in the execution of such supplemental indenture unless such
supplemental indenture affects the Debenture Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Debenture
Trustee may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
Promptly after the execution by the Corporation and the Debenture
Trustee of any supplemental indenture pursuant to the provisions of this
Section, the Debenture Trustee shall transmit by mail, first class postage
prepaid, a notice, prepared by the Corporation, setting forth in general terms
the substance of such supplemental indenture, to the Securityholders as their
names and addresses appear upon the Security Register. Any failure of the
Debenture Trustee to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.
It shall not be necessary for the consent of the Securityholders
under this Section 9.02 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent shall approve
the substance thereof.
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SECTION 9.03. Compliance with Trust Indenture Act; Effect of
Supplemental Indentures.
Any supplemental indenture executed pursuant to the provisions of
this Article IX shall comply with the Trust Indenture Act. Upon the execution of
any supplemental indenture pursuant to the provisions of this Article IX, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Debenture Trustee, the Corporation
and the holders of Securities shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and amendments,
and all the terms and conditions of any such supplemental indenture shall be and
be deemed to be part of the terms and conditions of this Indenture for any and
all purposes.
SECTION 9.04. Notation on Securities.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article IX may bear a
notation in form approved by the Debenture Trustee as to any matter provided for
in such supplemental indenture. If the Corporation or the Debenture Trustee
shall so determine, new Securities so modified as to conform, in the opinion of
the Debenture Trustee and the Board of Directors, to any modification of this
Indenture contained in any such supplemental indenture may be prepared and
executed by the Corporation, authenticated by the Debenture Trustee or the
Authenticating Agent and delivered in exchange for the Securities then
outstanding.
SECTION 9.05. Evidence of Compliance of Supplemental Indenture to be
Furnished to Debenture Trustee.
The Debenture Trustee, subject to the provisions of Sections 6.01
and 6.02, may receive an Officers' Certificate and an Opinion of Counsel as
conclusive evidence that any supplemental indenture executed pursuant hereto
complies with the requirements of this Article IX.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Corporation May Consolidate, etc., on Certain Terms.
Nothing contained in this Indenture or in any of the Securities
shall prevent any consolidation or merger of the
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Corporation with or into any other Person (whether or not affiliated with the
Corporation, as the case may be), or successive consolidations or mergers in
which the Corporation or its successor or successors, as the case may be, shall
be a party or parties, or shall prevent any sale, conveyance, transfer or lease
of the property of the Corporation, or its successor or successors as the case
may be, as an entirety, or substantially as an entirety, to any other Person
(whether or not affiliated with the Corporation, or its successor or successors,
as the case may be) authorized to acquire and operate the same; provided, that
(a) the Corporation is the surviving Person, or the Person formed by or
surviving any such consolidation or merger (if other than the Corporation) or to
which such sale, conveyance, transfer or lease of property is made is a Person
organized and existing under the laws of the United States or any State thereof
or the District of Columbia, and (b) upon any such consolidation, merger, sale,
conveyance, transfer or lease, the due and punctual payment of the principal of
(and premium, if any) and interest on the Securities according to their tenor
and the due and punctual performance and observance of all the covenants and
conditions of this Indenture to be kept or performed by the Corporation shall be
expressly assumed, by supplemental indenture (which shall conform to the
provisions of the Trust Indenture Act as then in effect) satisfactory in form to
the Debenture Trustee executed and delivered to the Debenture Trustee by the
Person formed by such consolidation, or into which the Corporation shall have
been merged, or by the Person which shall have acquired such property, as the
case may be, and (c) after giving effect to such consolidation, merger, sale,
conveyance, transfer or lease, no Default or Event of Default shall have
occurred and be continuing.
SECTION 10.02. Successor Corporation to be Substituted for
Corporation.
In case of any such consolidation, merger, sale, conveyance, or
lease and upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Debenture Trustee and satisfactory in
form to the Debenture Trustee, of the obligation of due and punctual payment of
the principal of (and premium, if any,) and interest on all of the Securities
and the due and punctual performance and observance of all of the covenants and
conditions of this Indenture to be performed or observed by the Corporation,
such successor Person shall succeed to and be substituted for the Corporation,
with the same effect as if it had been named herein as a party hereto, and the
Corporation thereupon shall be relieved of any further liability or obligation
hereunder or upon the Securities. Such successor Person thereupon may cause to
be signed, and may issue either in its own name or in the name of Banknorth
Group, Inc., any or all of the Securities issuable hereunder which theretofore
shall not have been signed by the Corporation and delivered to the Debenture
Trustee or the Authenticating Agent; and, upon the
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order of such successor Person instead of the Corporation and subject to all the
terms, conditions and limitations in this Indenture prescribed, the Debenture
Trustee or the Authenticating Agent shall authenticate and deliver any
Securities which previously shall have been signed and delivered by any Officer
of the Corporation to the Debenture Trustee or the Authenticating Agent for
authentication, and any Securities which such successor Person thereafter shall
cause to be signed and delivered to the Debenture Trustee or the Authenticating
Agent for that purpose. All the Securities so issued shall in all respects have
the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of the execution
hereof.
SECTION 10.03. Opinion of Counsel to be Given Debenture Trustee.
The Debenture Trustee, subject to the provisions of Sections 6.01
and 6.02, may receive an Opinion of Counsel as conclusive evidence that any
consolidation, merger, sale, conveyance, transfer or lease, and any assumption,
permitted or required by the terms of this Article X complies with the
provisions of this Article X.
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.
When (a) the Corporation shall deliver to the Debenture Trustee for
cancellation all Securities theretofore authenticated (other than any Securities
which shall have been destroyed, lost or stolen and which shall have been
replaced as provided in Section 2.08) and not theretofore cancelled, or (b) all
the Securities not theretofore cancelled or delivered to the Debenture Trustee
for cancellation shall have become due and payable, or are by their terms to
become due and payable within one year or are to be called for prepayment within
one year under arrangements satisfactory to the Debenture Trustee for the giving
of notice of prepayment, and the Corporation shall deposit with the Debenture
Trustee, in trust, funds sufficient to pay on the Maturity Date or upon
prepayment all of the Securities (other than any Securities which shall have
been destroyed, lost or stolen and which shall have been replaced as provided in
Section 2.08) not theretofore cancelled or delivered to the Debenture Trustee
for cancellation, including principal (and premium, if any) and interest
(including Compounded Interest and Additional Sums, if any) and Liquidated
Damages, if any, due or to become due to the Maturity Date or prepayment date,
as the case may be,
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but excluding, however, the amount of any moneys for the payment of principal of
(or premium, if any) or interest (including Compounded Interest and Additional
Sums, if any) or Liquidated Damages, if any, on the Securities (1) theretofore
repaid to the Corporation in accordance with the provisions of Section 11.04, or
(2) paid to any State or to the District of Columbia pursuant to its unclaimed
property or similar laws, and if, in either case the Corporation shall also pay
or cause to be paid all other sums payable hereunder by the Corporation, then
this Indenture shall cease to be of further effect except for the provisions of
Sections 2.02, 2.07, 2.08, 3.01, 3.02, 3.04, 6.06, 6.10 and 11.04 hereof, which
shall survive until such Securities shall mature and be paid. Thereafter,
Sections 6.06, 6.10 and 11.04 shall survive, and the Debenture Trustee, on
demand of the Corporation accompanied by any Officers' Certificate and an
Opinion of Counsel and at the cost and expense of the Corporation, shall execute
proper instruments acknowledging satisfaction of and discharging this Indenture;
the Corporation, however, hereby agrees to reimburse the Debenture Trustee for
any costs or expenses thereafter reasonably and properly incurred by the
Debenture Trustee in connection with this Indenture or the Securities.
SECTION 11.02. Deposited Moneys and U.S. Government Obligations to
be Held in Trust by Debenture Trustee.
Subject to the provisions of Section 11.04, all moneys and U.S.
Government Obligations deposited with the Debenture Trustee pursuant to Sections
11.01 or 11.05 shall be held in trust and applied by it to the payment, either
directly or through any paying agent (including the Corporation if acting as its
own paying agent), to the holders of the particular Securities for the payment
of which such moneys or U.S. Government Obligations have been deposited with the
Debenture Trustee, of all sums due and to become due thereon for principal,
premium, if any, and interest.
The Corporation shall pay and indemnify the Debenture Trustee
against any tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 11.05 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the holders of outstanding Securities.
SECTION 11.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture all moneys
then held by any paying agent of the Securities (other than the Debenture
Trustee) shall, upon written demand of the Corporation, be repaid to it or paid
to the Debenture Trustee,
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and thereupon such paying agent shall be released from all further liability
with respect to such moneys.
SECTION 11.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Debenture Trustee or any
paying agent for payment of the principal of (or premium, if any) or interest
(including Compounded Interest and Additional Sums, if any) or Liquidated
Damages, if any, on Securities and not applied but remaining unclaimed by the
holders of Securities for two years after the date upon which the principal of
(or premium, if any) or interest (including Compounded Interest and Additional
Sums, if any) or Liquidated Damages, if any, on such Securities, as the case may
be, shall have become due and payable, shall be repaid to the Corporation by the
Debenture Trustee or such paying agent; and the holder of any of the Securities
shall thereafter look only to the Corporation for any payment which such holder
may be entitled to collect and all liability of the Debenture Trustee or such
paying agent with respect to such moneys shall thereupon cease.
SECTION 11.05. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations.
The Corporation shall be deemed to have been Discharged (as defined
below) from its obligations with respect to the Securities on the 91st day after
the applicable conditions set forth below have been satisfied:
(1) the Corporation shall have deposited or caused to be deposited
irrevocably with the Debenture Trustee or the Defeasance Agent
(as defined below) as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit
of the holders of the Securities (i) money in an amount, or
(ii) U.S. Government Obligations which through the payment of
interest and principal in respect thereof in accordance with
their terms will provide, not later than one day before the
due date of any payment, money in an amount, or (iii) a
combination of (i) and (ii), sufficient, in the opinion (with
respect to (ii) and (iii)) of a nationally recognized firm of
independent public accountants expressed in a written
certification thereof delivered to the Debenture Trustee and
the Defeasance Agent, if any, to pay and discharge each
installment of principal of and interest and premium, if any,
on the outstanding Securities on the dates such installments
of principal, interest or premium are due;
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(2) if the Securities are then listed on any national securities
exchange, the Corporation shall have delivered to the
Debenture Trustee and the Defeasance Agent, if any, an Opinion
of Counsel to the effect that the exercise of the option under
this Section 11.05 would not cause such Securities to be
delisted from such exchange;
(3) no Default or Event of Default with respect to the Securities
shall have occurred and be continuing on the date of such
deposit; and
(4) the Corporation shall have delivered to the Debenture Trustee
and the Defeasance Agent, if any, an Opinion of Counsel to the
effect that holders of the Securities will not recognize
income, gain or loss for United States federal income tax
purposes as a result of the exercise of the option under this
Section 11.05 and will be subject to United States federal
income tax on the same amount and in the same manner and at
the same times as would have been the case if such option had
not been exercised.
"Discharged" means that the Corporation shall be deemed to have paid
and discharged the entire indebtedness represented by, and obligations under,
the Securities and to have satisfied all the obligations under this Indenture
relating to the Securities (and the Debenture Trustee, at the expense of the
Corporation, shall execute proper instruments acknowledging the same), except
(A) the rights of holders of Securities to receive, from the trust fund
described in clause (1) above, payment of the principal of and the interest and
premium, if any, on the Securities when such payments are due; (B) the
Corporation's obligations with respect to the Securities under Sections 2.07,
2.08, 5.02 and 11.04; and (C) the rights, powers, trusts, duties and immunities
of the Debenture Trustee hereunder.
"Defeasance Agent" means another financial institution which is
eligible to act as Debenture Trustee hereunder and which assumes all of the
obligations of the Debenture Trustee necessary to enable the Debenture Trustee
to act hereunder. In the event such a Defeasance Agent is appointed pursuant to
this Section, the following conditions shall apply:
(1) the Debenture Trustee shall have approval rights over the
document appointing such Defeasance Agent and the document
setting forth such Defeasance Agent's rights and
responsibilities; and
(2) the Defeasance Agent shall provide verification to the
Debenture Trustee acknowledging receipt of
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sufficient money and/or U. S. Government Obligations to meet
the applicable conditions set forth in this Section 11.05.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely Corporate
Obligations.
No recourse for the payment of the principal of or premium, if any,
or interest (including Compounded Interest and Additional Sums, if any) or
Liquidated Damages, if any, on any Security, or for any claim based thereon or
otherwise in respect thereof, and no recourse under or upon any obligation,
covenant or agreement of the Corporation in this Indenture, or in any Security,
or because of the creation of any indebtedness represented thereby, shall be had
against any incorporator, stockholder, employee, officer or director, as such,
past, present or future, of the Corporation or of any successor Person to the
Corporation, either directly or through the Corporation or any successor Person
to the Corporation, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that all such liability is hereby expressly waived and
released as a condition of, and as a consideration for, the execution of this
Indenture and the issuance of the Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors.
All the covenants, stipulations, promises and agreements in this
Indenture contained by the Corporation shall bind its successors and assigns
whether so expressed or not.
SECTION 13.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Indenture authorized
or required to be done or performed by any board, committee or officer of the
Corporation shall and may be done and performed with like force and effect by
the like board, committee or officer of any corporation that shall at the time
be the lawful sole successor of the Corporation.
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SECTION 13.03. Surrender of Corporation Powers.
The Corporation by instrument in writing executed by authority of
2/3 (two-thirds) of its Board of Directors and delivered to the Debenture
Trustee may surrender any of the powers reserved to the Corporation, and
thereupon such power so surrendered shall terminate both as to the Corporation,
as the case may be, and as to any successor Person.
SECTION 13.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Debenture Trustee or by the
holders of Securities on the Corporation may be given or served by being
deposited postage prepaid by first class mail, registered or certified mail,
overnight courier service or conformed telecopy addressed (until another address
is filed by the Corporation with the Debenture Trustee for the purpose) to the
Corporation at 300 Financial Plaza, P.O. Box 5420, Burlington, Vermont 05401,
Attention: Neal E. Robinson. Any notice, direction, request or demand by any
Securityholder to or upon the Debenture Trustee shall be deemed to have been
sufficiently given or made, for all purposes, if given or made in writing at the
office of the Debenture Trustee, The First National Bank of Chicago, One First
National Plaza Mall, Suite 0126, Chicago, IL 60670-0126, Attention: Corporate
Trust Administrator (unless another address is provided by the Debenture Trustee
to the Corporation for such purpose). Any notice or communication to a
Securityholder shall be mailed by first class mail to his or her address shown
on the Security Register kept by the security registrar for the Securities.
SECTION 13.05. Governing Law.
This Indenture and each Security shall be deemed to be a contract
made under the laws of the State of New York, and for all purposes shall be
governed by and construed in accordance with the laws of said State, without
regard to conflicts of laws principles thereof.
SECTION 13.06. Evidence of Compliance with Conditions Precedent.
Upon any application or demand by the Corporation to the Debenture
Trustee to take any action under any of the provisions of this Indenture, the
Corporation shall furnish to the Debenture Trustee an Officers' Certificate
stating that in the opinion of the signers all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
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Each certificate or opinion provided for in this Indenture and
delivered to the Debenture Trustee with respect to compliance with a condition
or covenant provided for in this Indenture (except certificates delivered
pursuant to Section 3.05) shall include (1) a statement that the Person making
such certificate or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
SECTION 13.07. Business Days.
In any case where the date of payment of principal of (or premium,
if any) or interest on the Securities is not a Business Day, the payment of such
principal of (or premium, if any) or interest on the Securities will not be made
on such date but will be made on the next succeeding Business Day, with the same
force and effect as if made on the original date of payment, and no interest
shall accrue for the period from and after such date, except that, in the case
of any prepayment pursuant to Article XIV, if such next succeeding Business Day
falls in the next succeeding calendar year, then such payment shall be made on
the immediately preceding Business Day.
SECTION 13.08. Trust Indenture Act to Control.
If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by Sections 310 to 318,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 13.09. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the articles
and sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
SECTION 13.10. Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together constitute
but one and the same instrument.
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SECTION 13.11. Separability.
In case any one or more of the provisions contained in this
Indenture or in the Securities shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Indenture or of
the Securities, but this Indenture and the Securities shall be construed as if
such invalid or illegal or unenforceable provision had never been contained
herein or therein.
SECTION 13.12. Assignment.
The Corporation will have the right at all times to assign any of
its respective rights or obligations under this Indenture to a direct or
indirect wholly owned Subsidiary of the Corporation, provided that, in the event
of any such assignment, the Corporation will remain liable for all such
obligations. Subject to the foregoing, this Indenture is binding upon and inures
to the benefit of the parties thereto and their respective successors and
assigns. This Indenture may not otherwise be assigned by the parties thereto.
SECTION 13.13. Acknowledgement of Rights.
The Corporation acknowledges that, with respect to any Securities
held by the Trust or a trustee of such trust, if the Property Trustee of such
Trust fails to enforce its rights under this Indenture as the holder of the
Securities held as the assets of the Trust, any holder of Capital Securities may
institute legal proceedings directly against the Corporation to enforce such
Property Trustee's rights under this Indenture without first instituting any
legal proceedings against such Property Trustee or any other person or entity.
Notwithstanding the foregoing, if an Event of Default has occurred and is
continuing and such event is attributable to the failure of the Corporation to
pay principal of (or premium, if any) or interest on the Securities when due,
the Corporation acknowledges that a holder of Capital Securities may directly
institute a proceeding for enforcement of payment to such holder of the
principal of (or premium, if any) or interest on the Securities having a
principal amount equal to the aggregate liquidation amount of the Capital
Securities of such holder on or after the respective due date specified in the
Securities.
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ARTICLE XIV
PREPAYMENT OF SECURITIES; MANDATORY AND
OPTIONAL SINKING FUND
SECTION 14.01. Special Event Prepayment.
If, prior to the Initial Optional Prepayment Date, a Special Event
has occurred and is continuing, then notwithstanding Section 14.02(a) but
subject to Section 14.02(c), the Corporation shall have the right, at any time
within 90 days following the occurrence of such Special Event, upon (i) not less
than 45 days written notice to the Debenture Trustee and (ii) not less than 30
days nor more than 60 days' written notice to the Securityholders, to prepay the
Securities, in whole (but not in part), at the Special Event Prepayment Price.
Following a Special Event, the Corporation shall take such action as is
necessary to promptly determine the Special Event Prepayment Price, including
without limitation the appointment of a Quotation Agent. The Special Event
Prepayment Price shall be paid prior to 12:00 noon, New York, New York time, on
the date of such prepayment or such earlier time as the Corporation determines,
provided that the Corporation shall deposit with the Debenture Trustee an amount
sufficient to pay the Special Event Prepayment Price by 10:00 a.m., New York,
New York time, on the date such Special Event Prepayment Price is to be paid.
SECTION 14.02. Optional Prepayment by Corporation.
(a) Subject to Sections 14.02(b) and (c), the Corporation shall have
the right to prepay the Securities, in whole or in part, at any time on or after
the Initial Optional Prepayment Date, upon not less than 30 days and not more
than 60 days' written notice, at the prepayment prices set forth below plus, in
each case, accrued and unpaid interest thereon (including Compounded Interest
and Additional Sums, if any) and Liquidated Damages, if any, to the applicable
date of prepayment (the "Optional Prepayment Price") if prepaid during the
12-month period beginning May 1 of the years indicated below.
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Percentage
Year of Principal
---- ------------
2007 105.260%
2008 104.734%
2009 104.208%
2010 103.682%
2011 103.156%
2012 102.630%
2013 102.104%
2014 101.578%
2015 101.052%
2016 100.526%
2017 and thereafter 100.000%
If the Securities are only partially prepaid pursuant to this
Section 14.02, the Securities to be prepaid shall be selected on a pro rata
basis not more than 60 days prior to the date fixed for prepayment from the
outstanding Securities not previously called for prepayment, provided, however,
that with respect to Securityholders that would be required to hold Securities
with an aggregate principal amount of less than $100,000 but more than an
aggregate principal amount of zero as a result of such pro rata prepayment, the
Corporation shall prepay Securities of each such Securityholder so that after
such prepayment such Securityholder shall hold Securities either with an
aggregate principal amount of at least $100,000 or such Securityholder no longer
holds any Securities, and shall use such method (including, without limitation,
by lot) as the Corporation shall deem fair and appropriate, provided, further,
that any such proration may be made on the basis of the aggregate principal
amount of Securities held by each Securityholder and may be made by making such
adjustments as the Corporation deems fair and appropriate in order that only
Securities in denominations of $1,000 or integral multiples thereof shall be
prepaid. The Optional Prepayment Price shall be paid prior to 12:00 noon, New
York time, on the date of such prepayment or at such earlier time as the
Corporation determines, provided that the Corporation shall deposit with the
Debenture Trustee an amount sufficient to pay the Optional Prepayment Price by
10:00 a.m., New York, New York time, on the date such Optional Prepayment Price
is to be paid.
(b) Notwithstanding the first sentence of Section 14.02(a), upon the
entry of an order for dissolution of the Trust by a court of competent
jurisdiction, the Securities thereafter will be subject to optional prepayment,
in whole only, but not in part, on or after the Initial Optional Prepayment
Date, at the applicable Optional Prepayment Prices and otherwise in accordance
with this Article XIV.
(c) Any prepayment of Securities pursuant to Section 14.01 or
Section 14.02 shall be subject to the Corporation
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obtaining the prior approval of the Federal Reserve, if such approval is then
required under applicable capital guidelines or policies of the Federal Reserve,
and any other required regulatory approvals.
SECTION 14.03. No Sinking Fund.
The Securities are not entitled to the benefit of any sinking fund.
SECTION 14.04. Notice of Prepayment; Selection of Securities.
In case the Corporation shall desire to exercise the right to prepay
all, or, as the case may be, any part of the Securities in accordance with their
terms, it shall fix a date for prepayment and shall mail a notice of such
prepayment at least 30 and not more than 60 days prior to the date fixed for
prepayment to the holders of Securities to be so prepaid as a whole or in part
at their last addresses as the same appear on the Security Register. Such
mailing shall be by first class mail. The notice if mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives such notice. In any case, failure to give such notice by
mail or any defect in the notice to the holder of any Security designated for
prepayment as a whole or in part shall not affect the validity of the
proceedings for the prepayment of any other Security.
Each such notice of prepayment shall specify the CUSIP number of the
Securities to be prepaid, the date fixed for prepayment, the prepayment price at
which the Securities are to be prepaid (or the method by which such prepayment
price is to be calculated), the place or places of payment that payment will be
made upon presentation and surrender of the Securities, that interest accrued to
the date fixed for prepayment will be paid as specified in said notice, and that
on and after said date interest thereon or on the portions thereof to be prepaid
will cease to accrue. If less than all the Securities are to be prepaid, the
notice of prepayment shall specify the numbers of the Securities to be prepaid.
In case any Security is to be prepaid in part only, the notice of prepayment
shall state the portion of the principal amount thereof to be prepaid and shall
state that on and after the date fixed for prepayment, upon surrender of such
Security, a new Security or Securities in principal amount equal to the portion
thereof that has not been prepaid will be issued.
By 10:00 a.m., New York, New York time on the prepayment date
specified in the notice of prepayment given as provided in this Section, the
Corporation will deposit with the Debenture Trustee or with one or more paying
agents an amount of money
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sufficient to prepay on the prepayment date all the Securities so called for
prepayment at the appropriate Prepayment Price, together with interest accrued
thereon to the date fixed for prepayment.
SECTION 14.05. Payment of Securities Called for Prepayment.
If notice of prepayment has been given as provided in Section 14.04,
the Securities or portions of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable Prepayment Price, together with interest
accrued thereon to the date fixed for prepayment (subject to the rights of
holders of Securities at the close of business on a regular record date in
respect of an Interest Payment Date occurring on or prior to the prepayment
date), and on and after said date (unless the Corporation shall default in the
payment of such Securities at the Prepayment Price, together with interest
accrued thereon to said date) interest (including Compounded Interest and
Additional Sums, if any) and Liquidated Damages, if any, on the Securities or
portions of Securities so called for prepayment shall cease to accrue. On
presentation and surrender of such Securities at a place of payment specified in
said notice, the said Securities or the specified portions thereof shall be paid
and prepaid by the Corporation at the applicable Prepayment Price, together with
interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, accrued thereon to the date fixed for prepayment
(subject to the rights of holders of Securities on the close of business on a
regular record date in respect of an Interest Payment Date occurring on or prior
to the prepayment date).
Upon presentation of any Security prepaid in part only, the
Corporation shall execute and the Debenture Trustee shall authenticate and make
available for delivery to the holder thereof, at the expense of the Corporation,
a new Security or Securities of authorized denominations, in principal amount
equal to the portion of the Security so presented that has not been prepaid.
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ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate.
The Corporation covenants and agrees, and each holder of Securities
issued hereunder likewise covenants and agrees, that the Securities shall be
issued subject to the provisions of this Article XV; and each holder of a
Security, whether upon original issue or upon transfer or assignment thereof,
accepts and agrees to be bound by such provisions.
The payment by the Corporation of the principal of, premium, if any,
and interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on all Securities issued hereunder shall, to the
extent and in the manner hereinafter set forth, be subordinated and junior in
right of payment to all Senior Indebtedness, whether outstanding at the date of
this Indenture or thereafter incurred.
No provision of this Article XV shall prevent the occurrence of any
Default or Event of Default hereunder.
SECTION 15.02. Default on Senior Indebtedness.
In the event and during the continuation of any default by the
Corporation in the payment of principal, premium, interest or any other payment
due on any Senior Indebtedness, or in the event that the maturity of any Senior
Indebtedness has been accelerated because of a default, then, in either case, no
payment shall be made by the Corporation with respect to the principal
(including prepayment payments) of (or premium, if any) or interest on the
Securities (including Compounded Interest and Additional Sums (if any) and
Liquidated Damages, if any, or any other amounts which may be due on the
Securities pursuant to the terms hereof or thereof).
In the event of the acceleration of the maturity of the Securities,
then no payment shall be made by the Corporation with respect to the principal
(including prepayment payments) of (or premium, if any) or interest on the
Securities (including Compounded Interest and Additional Sums (if any) and
Liquidated Damages, if any, or any other amounts which may be due on the
Securities pursuant to the terms hereof or thereof) until the holders of all
Senior Indebtedness outstanding at the time of such acceleration shall receive
payment in full of such Senior Indebtedness (including any amounts due upon
acceleration).
In the event that, notwithstanding the foregoing, any payment shall
be received by the Debenture Trustee when such payment is prohibited by the
preceding paragraphs of this Section
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15.02, such payment shall be held in trust for the benefit of, and shall be paid
over or delivered to, the holders of Senior Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, but only to the extent that the holders of the Senior
Indebtedness (or their representative or representatives or a trustee) notify
the Debenture Trustee in writing within 90 days of such payment of the amounts
then due and owing on such Senior Indebtedness, and only the amounts specified
in such notice to the Debenture Trustee shall be paid to the holders of such
Senior Indebtedness.
SECTION 15.03. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Corporation or distribution of assets of the
Corporation of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Corporation, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, the holders of all Senior Indebtedness of the
Corporation will first be entitled to receive payment in full of such Senior
Indebtedness, before any payment is made by the Corporation on account of the
principal of (or premium, if any) or interest on the Securities (including
Compounded Interest and Additional Sums (if any) and Liquidated Damages, if any,
or any other amounts which may be due on the Securities pursuant to the terms
hereof or thereof); and upon any such dissolution or winding-up or liquidation
or reorganization, any payment by the Corporation, or distribution of assets of
the Corporation of any kind or character, whether in cash, property or
securities, which the Securityholders or the Debenture Trustee would be entitled
to receive from the Corporation, except for the provisions of this Article XV,
shall be paid by the Corporation or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Securityholders or by the Debenture Trustee under the Indenture if
received by them or it, directly to the holders of Senior Indebtedness of the
Corporation (pro rata to such holders on the basis of the respective amounts of
Senior Indebtedness held by such holders, as calculated by the Corporation) or
their representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing such Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all such Senior Indebtedness in full, in money or money's
worth, after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Indebtedness, before any payment or distribution is
made to the Securityholders or to the Debenture Trustee.
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In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Corporation of any kind or character prohibited by
the foregoing, whether in cash, property or securities, shall be received by the
Debenture Trustee before all Senior Indebtedness is paid in full, or provision
is made for such payment in money in accordance with its terms, such payment or
distribution shall be held in trust for the benefit of and shall be paid over or
delivered to the holders of such Senior Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Corporation, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all such Senior Indebtedness in full in money in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the benefit of the holders of such Senior Indebtedness.
For purposes of this Article XV, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Corporation as
reorganized or readjusted, or securities of the Corporation or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this Article
XV with respect to the Securities to the payment of Senior Indebtedness that may
at the time be outstanding, provided that (i) such Senior Indebtedness is
assumed by the new corporation, if any, resulting from any such reorganization
or readjustment, and (ii) the rights of the holders of such Senior Indebtedness
are not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Corporation with, or the merger of the
Corporation into, another Person or the liquidation or dissolution of the
Corporation following the sale, conveyance, transfer or lease of its property as
an entirety, or substantially as an entirety, to another Person upon the terms
and conditions provided for in Article X of this Indenture shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section 15.03 if such other Person shall, as a part of such consolidation,
merger, sale, conveyance, transfer or lease, comply with the conditions stated
in Article X of this Indenture. Nothing in Section 15.02 or in this Section
15.03 shall apply to claims of, or payments to, the Debenture Trustee under or
pursuant to Section 6.06 of this Indenture.
SECTION 15.04. Subrogation.
Subject to the payment in full of all Senior Indebtedness, the
rights of the Securityholders shall be subrogated to the rights of the holders
of such Senior Indebtedness to receive payments or distributions of cash,
property or securities of the
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Corporation, as the case may be, applicable to such Senior Indebtedness until
the principal of (and premium, if any) and interest on the Securities shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of such Senior Indebtedness of any cash, property
or securities to which the Securityholders or the Debenture Trustee would be
entitled except for the provisions of this Article XV, and no payment over
pursuant to the provisions of this Article XV to or for the benefit of the
holders of such Senior Indebtedness by Securityholders or the Debenture Trustee,
shall, as between the Corporation, its creditors other than holders of Senior
Indebtedness of the Corporation, and the holders of the Securities, be deemed to
be a payment by the Corporation to or on account of such Senior Indebtedness. It
is understood that the provisions of this Article XV are and are intended solely
for the purposes of defining the relative rights of the holders of the
Securities, on the one hand, and the holders of such Senior Indebtedness on the
other hand.
Nothing contained in this Article XV or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Corporation,
its creditors other than the holders of Senior Indebtedness of the Corporation,
and the holders of the Securities, the obligation of the Corporation, which is
absolute and unconditional, to pay to the holders of the Securities the
principal of (and premium, if any) and interest (including Compounded Interest
and Additional Sums, if any) and Liquidated Damages, if any, on the Securities
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the holders of
the Securities and creditors of the Corporation, as the case may be, other than
the holders of Senior Indebtedness of the Corporation, as the case may be, nor
shall anything herein or therein prevent the Debenture Trustee or the holder of
any Security from exercising all remedies otherwise permitted by applicable law
upon default under the Indenture, subject to the rights, if any, under this
Article XV of the holders of such Senior Indebtedness in respect of cash,
property or securities of the Corporation, as the case may be, received upon the
exercise of any such remedy.
Upon any payment or distribution of assets of the Corporation
referred to in this Article XV, the Debenture Trustee, subject to the provisions
of Article VI of this Indenture, and the Securityholders shall be entitled to
conclusively rely upon any order or decree made by any court of competent
jurisdiction in which such dissolution, winding-up, liquidation or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person making such
payment or distribution, delivered to the Debenture Trustee or to the
Securityholders, for the purposes of ascertaining the Persons entitled to
participate in such
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distribution, the holders of Senior Indebtedness and other indebtedness of the
Corporation, as the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XV.
SECTION 15.05. Debenture Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance thereof
authorizes and directs the Debenture Trustee on such Securityholder's behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article XV and appoints the Debenture Trustee
such Securityholder's attorney-in-fact for any and all such purposes.
SECTION 15.06. Notice by the Corporation.
The Corporation shall give prompt written notice to a Responsible
Officer of the Debenture Trustee of any fact known to the Corporation that would
prohibit the making of any payment of monies to or by the Debenture Trustee in
respect of the Securities pursuant to the provisions of this Article XV.
Notwithstanding the provisions of this Article XV or any other provision of this
Indenture, the Debenture Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment of monies
to or by the Debenture Trustee in respect of the Securities pursuant to the
provisions of this Article XV, unless and until a Responsible Officer of the
Debenture Trustee shall have received written notice thereof from the
Corporation or a holder or holders of Senior Indebtedness or from any trustee
therefor; and before the receipt of any such written notice, the Debenture
Trustee, subject to the provisions of Article VI of this Indenture, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Debenture Trustee shall not have received the notice provided for in
this Section 15.06 at least two Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose (including,
without limitation, the payment of the principal of (or premium, if any) or
interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on any Security), then, anything herein contained to
the contrary notwithstanding, the Debenture Trustee shall have full power and
authority to receive such money and to apply the same to the purposes for which
they were received, and shall not be affected by any notice to the contrary that
may be received by it within two Business Days prior to such date.
The Debenture Trustee, subject to the provisions of Article VI of
this Indenture, shall be entitled to conclusively rely on a written notice
delivered to it by a Person representing
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himself to be a holder of Senior Indebtedness of the Corporation (or a trustee
on behalf of such holder), as the case may be, to establish that such notice has
been given by a holder of such Senior Indebtedness or a trustee on behalf of any
such holder or holders. In the event that the Debenture Trustee determines in
good faith that further evidence is required with respect to the right of any
Person as a holder of such Senior Indebtedness to participate in any payment or
distribution pursuant to this Article XV, the Debenture Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Debenture
Trustee as to the amount of such 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 XV, and, if such evidence is not furnished, the Debenture Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
Upon any payment or distribution of assets of the Corporation
referred to in this Article XV, the Debenture Trustee and the Securityholders
shall be entitled to rely upon any order or decree entered by any court of
competent jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding-up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy,
liquidating trustee, custodian, receiver, assignee for the benefit of creditors,
agent or other person making such payment or distribution, delivered to the
Debenture Trustee or to the Securityholders, for the purpose of ascertaining the
persons entitled to participate in such payment or distribution, the holders of
Senior Indebtedness and other indebtedness of the Corporation, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article XV.
SECTION 15.07. Rights of the Debenture Trustee; Holders of Senior
Indebtedness.
The Debenture Trustee in its individual capacity shall be entitled
to all the rights set forth in this Article XV in respect of any Senior
Indebtedness at any time held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Debenture
Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness of the
Corporation, the Debenture Trustee undertakes to perform or to observe only such
of its covenants and obligations as are specifically set forth in this Article
XV, and no implied covenants or obligations with respect to the holders of such
Senior Indebtedness shall be read into this Indenture against the Debenture
Trustee. The Debenture Trustee shall not be deemed to owe
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any fiduciary duty to the holders of such Senior Indebtedness and, subject to
the provisions of Article VI of this Indenture, the Debenture Trustee shall not
be liable to any holder of such Senior Indebtedness if it shall pay over or
deliver to Securityholders, the Corporation or any other Person money or assets
to which any holder of such Senior Indebtedness shall be entitled by virtue of
this Article XV or otherwise.
Nothing in this Article XV shall apply to claims of, or payments to,
the Debenture Trustee under or pursuant to Section 6.06.
SECTION 15.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness
of the Corporation 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 Corporation, as the case may be, or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Corporation, as the
case may be, with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or otherwise
be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness of the Corporation may, at any
time and from time to time, without the consent of or notice to the Debenture
Trustee or the Securityholders, without incurring responsibility to the
Securityholders and without impairing or releasing the subordination provided in
this Article XV or the obligations hereunder of the holders of the Securities to
the holders of such Senior Indebtedness, do any one or more of the following:
(i) change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, such Senior Indebtedness, or otherwise amend or
supplement in any manner such Senior Indebtedness or any instrument evidencing
the same or any agreement under which such Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing such Senior Indebtedness; (iii) release any
Person liable in any manner for the collection of such Senior Indebtedness; and
(iv) exercise or refrain from exercising any rights against the Corporation, as
the case may be, and any other Person.
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ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is continuing, the
Corporation shall have the right, at any time and from time to time during the
term of the Securities, to defer payments of interest by extending the interest
payment period of such Securities for a period not exceeding 10 consecutive
semi-annual periods, including the first such semi-annual period during such
extension period (the "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable; provided that no
Extended Interest Payment Period shall end on a date other than an Interest
Payment Date or extend beyond the Maturity Date. To the extent permitted by
applicable law, interest, the payment of which has been deferred because of the
extension of the interest payment period pursuant to this Section 16.01, will
bear interest thereon at the Coupon Rate compounded semi-annually for each
semi-annual period during the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Corporation
shall pay all interest accrued and unpaid on the Securities, including any
Additional Sums and Compounded Interest (together, "Deferred Interest"), that
shall be payable to the holders of the Securities in whose names the Securities
are registered in the Security Register on the record date immediately preceding
the end of the Extended Interest Payment Period. Before the termination of any
Extended Interest Payment Period, the Corporation may further defer payments of
interest by further extending such Extended Interest Payment Period, provided
that such Extended Interest Payment Period, together with all such previous and
further extensions within such Extended Interest Payment Period, shall not (i)
exceed 10 consecutive semi-annual periods, including the first such semi-annual
period during such Extended Interest Payment Period, (ii) end on a date other
than an Interest Payment Date or (iii) extend beyond the Maturity Date of the
Securities. Upon the termination of any Extended Interest Payment Period and the
payment of all amounts then due, the Corporation may commence a new Extended
Interest Payment Period, subject to the foregoing requirements. No interest
shall be due and payable during an Extended Interest Payment Period, except at
the end thereof, but the Corporation may prepay at any time all or any portion
of the interest accrued during an Extended Interest Payment Period.
SECTION 16.02. Notice of Extension.
(a) If the Property Trustee is the only registered holder of the
Securities at the time the Corporation selects an Extended Interest Payment
Period, the Corporation shall give
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written notice to the Administrative Trustees, the Property Trustee and the
Debenture Trustee of its selection of such Extended Interest Payment Period at
least five Business Days before the earlier of (i) the next succeeding date on
which Distributions on the Trust Securities would have been payable, or (ii) the
date the Property Trustee is required to give notice of the record date, or the
date such Distributions are payable, to any national securities exchange or to
holders of the Capital Securities, but in any event at least five Business Days
before such record date.
(b) If the Property Trustee is not the only holder of the Securities
at the time the Corporation selects an Extended Interest Payment Period, the
Corporation shall give the holders of the Securities and the Debenture Trustee
written notice of its selection of such Extended Interest Payment Period at
least 10 Business Days before the earlier of (i) the next succeeding Interest
Payment Date, or (ii) the date the Debenture Trustee is required to give notice
of the record or payment date of such interest payment to any national
securities exchange.
(c) The semi-annual period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 16.02 shall be counted as one of the 10
semi-annual periods permitted in the maximum Extended Interest Payment Period
permitted under Section 16.01.
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The First National Bank of Chicago hereby accepts the trusts in this
Indenture declared and provided, upon the terms and conditions hereinabove set
forth.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed by their respective officers thereunto duly authorized, as of
the day and year first above written.
BANKNORTH GROUP, INC.
By
-------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Debenture Trustee
By
-------------------------
Name:
Title:
83
<PAGE>
EXHIBIT A
(FORM OF FACE OF SECURITY)
[IF THIS SECURITY IS A GLOBAL SECURITY, INSERT: THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY ("DTC") OR A NOMINEE
OF DTC. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF
THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO
DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS 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 IN AS MUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH BANKNORTH GROUP, INC.,
(THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) ONLY (A) TO THE CORPORATION, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THIS
A-1
<PAGE>
SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF THE
CORPORATION PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D)
OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR
OTHER INFORMATION SATISFACTORY TO THE CORPORATION, AND (ii) PURSUANT TO CLAUSE
(D) TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
REVERSE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEREE TO THE
CORPORATION. SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.]
THE SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS
HAVING AN AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000. ANY SUCH
TRANSFER OF SECURITIES 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 SECURITIES FOR ANY
PURPOSE, INCLUDING BUT NOT LIMITED TO THE RECEIPT OF PRINCIPAL, PREMIUM (IF ANY)
OR INTEREST OF SUCH SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH SECURITIES.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF ALSO
AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT 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"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON
OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF
ANY PLAN MAY ACQUIRE OR HOLD THE CAPITAL SECURITIES OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE
UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23,
95-60, 91-38, 90-1 0R 84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY
PURCHASER OR HOLDER OF THE CAPITAL SECURITIES OR ANY INTEREST THEREIN WILL BE
DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i)
IT IS NOT A PLAN OR PLAN ASSET ENTITY OR (ii) THE ACQUISITION AND HOLDING OF
THIS CAPITAL SECURITY BY IT IS NOT PROHIBITED BY EITHER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE OR IS EXEMPT FORM ANY SUCH PROHIBITION.
A-2
<PAGE>
No. CUSIP No.
BANKNORTH GROUP, INC.
10.52% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE
DUE MAY 1, 2027, Series __
Banknorth Group, Inc., a Delaware corporation (the "Corporation",
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
$30,928,000 Dollars on May 1, 2027 (the "Maturity Date"), unless previously
prepaid, and to pay interest on the outstanding principal amount hereof from May
1, 1997, or from the most recent interest payment date (each such date, an
"Interest Payment Date") to which interest has been paid or duly provided for,
semi-annually (subject to deferral as set forth herein) in arrears on May 1 and
November 1 of each year, commencing November 1, 1997, at the rate of 10.52% per
annum until the principal hereof shall have become due and payable, and on any
overdue principal and premium, if any, and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum compounded
semi-annually ("Compounded Interest"). The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve
30-day months. In the event that any date on which the principal of (or premium,
if any) or interest on this Security is payable is not a Business Day (as
defined in the Indenture), then the payment payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), with the same force and effect as
if made on such date, except that, in the case of any repayment in accordance
with the provisions on the reverse hereof, if such next succeeding Business Day
falls in the next succeeeding calendar year, then such payment shall be made on
the immediately preceding Business Day. Pursuant to the Indenture, in certain
circumstances the Corporation will be required to pay Additional Sums (as
defined in the Indenture) with respect to this Security. Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Corporation
will be required to pay Liquidated Damages (as defined in the Registration
Rights Agreement) with respect to this Security.
The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities, as defined in said Indenture) is registered at the close of business
on the regular record date for such interest installment, which shall be at the
close of business on the 15th day of the month next preceeding that in which the
relevant Interest Payment Date falls. Any such interest installment not
punctually paid or duly provided for shall
A-3
<PAGE>
forthwith cease to be payable to the holders on such regular record date and may
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a special record date to
be fixed by the Debenture Trustee for the payment of such defaulted interest,
notice whereof shall be given to the holders of Securities not less than 10 days
prior to such special record date, or may be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture.
The principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if any,
on this Security shall be payable at the office or agency of the Debenture
Trustee maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be made at the
option of the Corporation by (i) check mailed to the holder at such address as
shall appear in the Security Register or (ii) transfer to an account maintained
by the Person entitled thereto, provided that proper written transfer
instructions have been received by the relevant record date. Notwithstanding the
foregoing, so long as the Holder of this Security is the Property Trustee of
Banknorth Capital Trust I, the payment of the principal of (and premium, if any)
and interest (including Compounded Interest and Additional Sums, if any) and
Liquidated Damages, if any, on this Security will be made at such place and to
such account as may be designated by such Property Trustee.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior 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 Debenture Trustee on his or her
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided and (c) appoints the Debenture Trustee
his or her attorney-in-fact for any and all such purposes. Each holder hereof,
by his or her acceptance hereof, hereby waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
This Security shall not be entitled to any benefit under the
Indenture or be valid or become obligatory for any purpose until the Certificate
of Authentication hereon shall have been signed by or on behalf of the Debenture
Trustee.
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<PAGE>
The provisions of this Security are continued on the reverse side hereof and
such provisions shall for all purposes have the same effect as though fully set
forth at this place.
A-5
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed and sealed this 1st day of May, 1997.
BANKNORTH GROUP, INC.
By:
-------------------------
Name:
Title:
Attest:
By:
-----------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but
solely as Debenture Trustee
By:
----------------------------------
Authorized Signatory
A-6
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the Corporation (herein
sometimes referred to as the "Securities"), specified in the Indenture, all
issued or to be issued under and pursuant to an Indenture, dated as of May 1,
1997 (the "Indenture"), duly executed and delivered between the Corporation and
The First National Bank of Chicago, as Debenture Trustee (the "Debenture
Trustee"), to which Indenture reference is hereby made for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of
the Debenture Trustee, the Corporation and the holders of the Securities.
Upon the occurrence and continuation of a Special Event (as defined
in the Indenture) prior to May 1, 2007 (the "Initial Optional Prepayment Date"),
the Corporation shall have the right, at any time within 90 days following the
occurrence of such Special Event, to prepay this Security in whole (but not in
part) at the Special Event Prepayment Price. "Special Event Prepayment Price"
shall mean, with respect to any prepayment of this Security following a Special
Event, an amount in cash equal to the Make Whole Amount. The "Make Whole Amount"
shall mean an amount equal to the greater of (i) 100% of the principal amount to
be prepaid or (ii) the sum, as determined by a Quotation Agent (as defined in
the Indenture), of the present values of remaining scheduled payments of
principal and interest hereon, discounted to the prepayment date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Adjusted Treasury Rate (as defined in the Indenture), plus, in the case
of each of clauses (i) and (ii), any accrued and unpaid interest (including
Compounded Interest and Additional Sums, if any) and Liquidated Damages, if any,
thereon to the date of such prepayment.
In addition, the Corporation shall have the right to prepay this
Security, in whole or in part, at any time on or after the Initial Optional
Prepayment Date (an "Optional Prepayment"), at the prepayment prices set forth
below plus, in each case, accrued and unpaid interest (including Additional Sums
and Compounded Interest, if any) and Liquidated Damages, if any, thereon to the
applicable date of prepayment (the "Optional Prepayment Price"), if prepaid
during the 12-month period beginning May 1 of the years indicated below.
A-7
<PAGE>
Percentage
Year of Principal
---- ------------
2007 105.260%
2008 104.734%
2009 104.208%
2010 103.682%
2011 103.156%
2012 102.630%
2013 102.104%
2014 101.578%
2015 101.052%
2016 100.526%
2017 and thereafter 100.000%
The Optional Prepayment Price or the Special Event Prepayment Price,
as the case requires, shall be paid prior to 12:00 noon, New York time, on the
date of such prepayment or at such earlier time as the Corporation determines,
provided, that the Corporation shall deposit with the Debenture Trustee an
amount sufficient to pay the applicable Prepayment Price by 10:00 a.m., New York
time, on the date such Prepayment Price is to be paid. Any prepayment pursuant
to this paragraph will be made upon not less than 30 days nor more than 60 days'
prior written notice.
If the Securities are only partially prepaid by the Corporation
pursuant to an Optional Prepayment, the particular Securities to be prepaid
shall be selected on a pro rata basis from the outstanding Securities not
previously called for prepayment; provided, however, that with respect to
Securityholders that would be required to hold Securities with an aggregate
principal amount of less than $100,000 but more than an aggregate principal
amount of zero as a result of such pro rata prepayment, the Corporation shall
prepay Securities of each such Securityholder so that after such prepayment such
Securityholder shall hold Securities either with an aggregate principal amount
of at least $100,000 or such Securityholder no longer holds any Securities and
shall use such method (including, without limitation, by lot) as the Corporation
shall deem fair and appropriate, provided, further, that any such proration may
be made on the basis of the aggregate principal amount of Securities held by
each Securityholder thereof and may be made by making such adjustments as the
Corporation deems fair and appropriate in order that only Securities in
denominations of $1,000 or integral multiples thereof shall be prepaid. In the
event of prepayment of this Security in part only, a new Security or Securities
for the portion hereof that has not been prepaid will be issued in the name of
the holder hereof upon the cancellation hereof.
Notwithstanding the foregoing, any prepayment of Securities by the
Corporation shall be subject to the prior approval of the Board of Governors of
the Federal Reserve System
A-8
<PAGE>
(the "Federal Reserve"), if such approval is then required under applicable
capital guidelines or policies of the Federal Reserve, and the receipt of any
other required regulatory approvals.
In case an Event of Default (as defined in the Indenture), shall
have occurred and be continuing, the principal of all of the Securities may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Corporation and the
Debenture Trustee, with the consent of the holders of a majority in aggregate
principal amount of the Securities at the time outstanding (as defined in the
Indenture), to execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of modifying in any manner the rights of the holders of the
Securities; provided, however, that no such supplemental indenture shall,
without the consent of each holder of Securities then outstanding and affected
thereby, (i) change the Maturity Date of any Security, or reduce the rate or
extend the time of payment of interest thereon (subject to Article XVI of the
Indenture), or reduce the principal amount thereof, or reduce any amount payable
on prepayment thereof, or make the principal thereof or any interest or premium
thereon payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any holder of Securities to
institute suit for payment thereof, or (ii) reduce the aforesaid percentage of
Securities the holders of which are required to consent to any such supplemental
indenture. The Indenture also contains provisions permitting the holders of a
majority in aggregate principal amount of the Securities at the time outstanding
affected thereby, on behalf of all of the holders of the Securities, to waive
any past default in the performance of any of the covenants contained in the
Indenture, or established pursuant to the Indenture, and its consequences,
except a default in the payment of the principal of or premium, if any, or
interest on any of the Securities or a default in respect of any covenant or
provision under which the Indenture cannot be modified or amended without the
consent of each holder of Securities then outstanding. Any such consent or
waiver by the holder of this Security (unless revoked as provided in the
Indenture) shall be conclusive and binding upon such Holder and upon all future
holders and owners of this Security and of any Security issued in exchange
herefor or in place hereof (whether by registration of transfer or otherwise),
irrespective of whether or not any notation of such consent or waiver is made
upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Corporation, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest
A-9
<PAGE>
(including Compounded Interest and Additional Sums, if any) and Liquidated
Damages, if any, on this Security at the time and place and at the rate and in
the money herein prescribed.
So long as no Event of Default shall have occurred and be
continuing, the Corporation shall have the right, at any time and from time to
time during the term of the Securities, to defer payments of interest by
extending the interest payment period of such Securities for a period not (i)
exceeding 10 consecutive semi-annual periods, including the first such
semi-annual period during such extension period (ii) extending beyond the
Maturity Date of the Securities (an "Extended Interest Payment Period") or (iii)
ending on a date other than an Interest Payment Date, at the end of which period
the Corporation shall pay all interest then accrued and unpaid (together with
interest thereon at the rate specified for the Securities to the extent that
payment of such interest is enforceable under applicable law). Before the
termination of any such Extended Interest Payment Period, the Corporation may
further defer payments of interest by further extending such Extended Interest
Payment Period, provided that such Extended Interest Payment Period, together
with all such previous and further extensions within such Extended Interest
Payment Period, (i) shall not exceed 10 consecutive semi-annual periods,
including the first semi-annual period during such Extended Interest Payment
Period, (ii) shall not end on any date other than an Interest Payment Date, and
(iii) shall not extend beyond the Maturity Date of the Securities. Upon the
termination of any such Extended Interest Payment Period and the payment of all
accrued and unpaid interest and any additional amounts then due, the Corporation
may commence a new Extended Interest Payment Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extended Interest
Payment Period, except at the end thereof, but the Corporation may prepay at any
time all or any portion of the interest accrued during an Extended Interest
Payment Period.
The Corporation has agreed that it will not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock,
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities (including other Debentures) of
the Corporation that rank pari passu with or junior in right of payment to the
Securities or (iii) make any guarantee payments with respect to any guarantee
(other than the Capital Securities Guarantee, as defined in the Indenture) by
the Corporation of the debt securities of any Subsidiary of the Corporation
(including Other Guarantees) if such guarantee ranks pari passu with or junior
in right of payment to the Securities (other than (a) dividends or distributions
in shares of, or options, warrants or rights to subscribe for or purchase shares
of, Common Stock of the Corporation, (b) any declaration of a dividend in
connection with the implementation of a stockholders' rights plan, or the
issuance of stock under any such plan in the
A-10
<PAGE>
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
as a result of a reclassification of the Corporation's capital stock or the
exchange or conversion of one class or series of the Corporation's capital stock
for another class or series of the Corporation's capital stock, (d) the purchase
of fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, and (e) purchases of Common Stock related to the
issuance of Common Stock or rights under any of the Corporation's benefit or
compensation plans for its directors, officers or employees or any of the
Corporation's dividend reinvestment plans), if at such time (1) there shall have
occurred any event of which the Corporation has actual knowledge that (a) is, or
with the giving of notice or the lapse of time, or both, would constitute, an
Event of Default and (b) in respect of which the Corporation shall not have
taken reasonable steps to cure, (2) if such Securities are held by the Property
Trustee of Banknorth Capital Trust I, the Corporation shall be in default with
respect to its payment of any obligations under the Capital Securities Guarantee
or (3) the Corporation shall have given notice of its election to exercise its
right to commence an Extended Interest Payment Period, and shall not have
rescinded such Notice, and such Extended Interest Payment Period or any
extension thereof shall have commenced and be continuing.
Subject to (i) the receipt of any required regulatory approval and
(ii) the receipt of an opinion of counsel to the effect that such distribution
will not be a taxable event to holders of Capital Securities, the Corporation
will have the right at any time to liquidate the Trust and cause the Securities
to be distributed to the holders of the Trust Securities in liquidation of the
Trust.
The Securities are issuable only in registered form without coupons
in minimum denominations of $100,000 and multiples of $1,000 in excess thereof.
As provided in the Indenture and subject to the transfer restrictions
limitations as may be contained herein and therein from time to time, this
Security is transferable by the holder hereof on the Security Register of the
Corporation, upon surrender of this Security for registration of transfer at the
office or agency of the Corporation in New York, New York accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Corporation or the Debenture Trustee duly executed by the holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities of
authorized denominations and for the same aggregate principal amount will be
issued to the designated transferee or transferees. No service charge will be
made for any such registration of transfer, but the Corporation may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in relation thereto.
A-11
<PAGE>
Prior to due presentment for registration of transfer of this
Security, the Corporation, the Debenture Trustee, any authenticating agent, any
paying agent, any transfer agent and the security registrar may deem and treat
the holder hereof as the absolute owner hereof (whether or not this Security
shall be overdue and notwithstanding any notice of ownership or writing hereon
made by anyone other than the security registrar for the Securities) for the
purpose of receiving payment of or on account of the principal hereof and
premium, if any, and (subject to the Indenture) interest due hereon and for all
other purposes, and neither the Corporation nor the Debenture Trustee nor any
authenticating agent nor any paying agent nor any transfer agent nor any
security registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of or
premium, if any, or interest (including Compounded Interest and Additional Sums,
if any) or Liquidated Damages, if any, on this Security, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, employee, officer or director,
past, present or future, as such, of the Corporation or of any predecessor or
successor Person, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issuance hereof, expressly waived and released.
All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT
OF LAW PROVISIONS THEREOF.
A-12
<PAGE>
EXHIBIT 4.2
(FORM OF FACE OF SECURITY)
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE CERTIFICATE
(FACE OF SECURITY)
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST
COMPANY ("DTC") OR A NOMINEE OF DTC. THIS SECURITY IS EXCHANGEABLE FOR
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE
OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, TO THE CORPORATION OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS 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 ENTITY IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN
BLOCKS HAVING AN AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000. ANY SUCH
TRANSFER OF SECURITIES IN A BLOCK HAVING AN AGGREGATE PRINCIPAL AMOUNT OF LESS
THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY
SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH SECURITIES FOR ANY
PURPOSE, INCLUDING BUT NOT LIMITED TO THE RECEIPT OF PRINCIPAL, PREMIUM (IF ANY)
OR INTEREST OF SUCH SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH SECURITIES.
2
<PAGE>
No. R-001
BANKNORTH GROUP, INC.
10.52% JUNIOR SUBORDINATED DEFERRABLE
INTEREST DEBENTURE DUE MAY 1, 2027, SERIES B
Banknorth Group, Inc., a Delaware corporation (the "Corporation," which
term includes any successor Person under the Indenture hereinafter referred to),
for value received, hereby promises to pay to The First National Bank of
Chicago, as Property Trustee of First of America Capital Trust I, or registered
assigns, the principal sum of ______________________________________________
_______ dollars ($____________) on May 1, 2027 (the "Maturity Date"), unless
previously prepaid, and to pay interest on the outstanding principal amount
hereof from [May 1, 1997] [November 1, 1997], or from the most recent interest
payment date (each such date, an "Interest Payment Date") to which interest has
been paid or duly provided for, semi-annually (subject to deferral as set forth
herein) in arrears on May 1 and November 1 of each year, commencing [November 1,
1997] [May 1, 1998] (each, an "Interest Payment Date"), at the rate of 10.52%
per annum until the principal hereof shall have become due and payable, and on
any overdue principal and premium, if any, and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum compounded
semi-annually ("Compounded Interest"). The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve
30-day months and, for any period less than a full calendar month, the number of
days elapsed in such month. In the event that any date on which the principal of
(or premium, if any) or interest on this Security is payable is not a Business
Day, then the payment payable on such date will be made on the next succeeding
day that is a Business Day (and without any interest or other payment in respect
of any such delay), with the same force and effect as if made on such date,
except that, in the case of any repayment in accordance with the provisions on
the reverse hereof, if such next succeeding Business Day falls in the next
succeeding calendar year, then such payment shall be made on the immediately
preceding Business Day. Pursuant to the Indenture, in certain circumstances
the Corporation will be required to pay Additional Sums (as defined in the
Indenture) with respect to this Security.
The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities, as defined in said Indenture) is registered at the close of business
on the regular record date for such interest installment, which shall be the
fifteenth day of the month next preceding that in which the relevant Interest
Payment Date falls. Any such interest installment not punctually paid or duly
provided for shall forthwith cease to be payable to the holders on such regular
record date and may be paid to the Person in whose name this Security (or one or
more Predecessor Securities) is registered at the close of business on a special
record date to be fixed by the Debenture Trustee for the payment of such
defaulted interest, notice whereof shall be given to the holders of Securities
not less than 10 days prior to such special record date, or may be
3
<PAGE>
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in the Indenture.
The principal of (and premium, if any) and interest (including
Compounded Interest and Additional Sums, if any) on this Security shall be
payable at the office or agency of the Debenture Trustee in The City of New
York, maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; PROVIDED, HOWEVER, that payment of interest may be made at the
option of the Corporation by (i) check mailed to the holder at such address as
shall appear in the Security Register or (ii) transfer to an account maintained
by the Person entitled thereto, provided that proper written transfer
instructions have been received by the relevant record date. Notwithstanding the
foregoing, so long as the Holder of this Security is the Property Trustee of
Banknorth Capital Trust I, the payment of the principal of (and premium, if any)
and interest (including Compounded Interest and Additional Sums, if any) on this
Security will be made in immediately available funds at such place and to such
account as may be designated by such Property Trustee.
The indebtedness evidenced by this Security is, to the extent provided
in the Indenture, subordinate and junior in right of payment to the prior
payment in full of all Senior 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 Debenture Trustee on his or her
behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided and (c) appoints the Debenture Trustee
his or her attorney-in-fact for any and all such purposes. Each holder hereof,
by his or her acceptance hereof, hereby waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
This Security shall not be entitled to any benefit under the Indenture
or be valid or become obligatory for any purpose until the Certificate of
Authentication hereon shall have been signed by or on behalf of the Debenture
Trustee.
The provisions of this Security are continued on the reverse side
hereof and such provisions shall for all purposes have the same effect as though
fully set forth at this place.
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Security to be duly
executed and sealed this ____ day of September, 1997.
BANKNORTH GROUP, INC.
By: ____________________________
Name:
Title:
Attest:
By: ______________________________
Name:
Title:
5
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the
within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but solely
as Debenture Trustee
By:__________________________________
Authorized Signatory
6
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the
Corporation (herein sometimes referred to as the "Securities"), specified in the
Indenture, all issued or to be issued under and pursuant to an Indenture, dated
as of May 1, 1997 (the "Indenture"), duly executed and delivered between the
Corporation and The First National Bank of Chicago, as Debenture Trustee (the
"Debenture Trustee"), to which Indenture reference is hereby made for a
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Debenture Trustee, the Corporation and the holders
of the Securities.
Upon the occurrence and continuation of a Special
Event prior to May 1, 2007 (the "Initial Optional Prepayment Date"), the
Corporation shall have the right at any time within 90 days following the
occurrence of such Special Event, to prepay this Security in whole (but not in
part) at the Special Event Prepayment Price. "Special Event Prepayment Price"
shall mean, with respect to any prepayment of this Security following a Special
Event, an amount in cash equal to the Make Whole Amount. The "Make Whole Amount"
shall mean an amount equal to the greater of (i) 100% of the principal amount to
be prepaid or (ii) the sum, as determined by a Quotation Agent, of the present
values of remaining scheduled payments of principal and interest hereon,
discounted to the prepayment date on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate, plus, in
each case of clauses (i) and (ii), any accrued and unpaid interest (including
Compounded Interest and Additional Sums, if any) thereon, if any, to the date
of such prepayment.
In addition, the Corporation shall have the right
to prepay this Security, in whole or (subject to Section 14.02(b) of the
Indenture) in part, at any time on or after the Initial Optional Prepayment Date
(an "Optional Payment"), at the prepayment prices set forth below (expressed as
a percentage of the outstanding principal amount to be redeemed) plus, in each
case, accrued and unpaid interest thereon (including Additional Sums and
Compounded Interest, if any) to the applicable date of prepayment (the
"Optional Prepayment Price"), if prepaid during the 12-month period beginning
May 1 of the years indicated below.
Year Percentage
2007 105.260%
2008 104.734%
2009 104.208%
2010 103.682%
2011 103.156%
2012 102.630%
2013 102.104%
2014 101.578%
2015 101.052%
2016 100.526%
7
<PAGE>
2017 and thereafter 100.000%
The Optional Prepayment Price or the Special Event
Prepayment Price, as the case requires, shall be paid prior to 12:00 noon, New
York time, on the date of such prepayment or at such earlier time as the
Corporation determines, provided, that the Corporation shall deposit with the
Debenture Trustee an amount sufficient to pay the applicable Prepayment Price by
10:00 a.m., New York time, on the date such Prepayment Price is to be paid. Any
prepayment pursuant to this paragraph will be made upon not less than 30 days
nor more than 60 days' prior written notice.
If the Securities are only partially prepaid by the
Corporation pursuant to an Optional Prepayment, the particular Securities to be
prepaid shall be selected on a pro rata basis from the outstanding Securities
not previously called for prepayment; provided, however, that with respect to
Securityholders that would be required to hold Securities with an aggregate
principal amount of less than $100,000 but more than an aggregate principal
amount of zero as a result of such pro rata prepayment, the Corporation shall
prepay Securities of each such Securityholder so that after such prepayment such
Securityholder shall hold Securities either with an aggregate principal amount
of at least $100,000 or such Securityholder no longer holds any Securities and
shall use such method (including, without limitation, by lot) as the Corporation
shall deem fair and appropriate, provided, further, that any such proration may
be made on the basis of the aggregate principal amount of Securities held by
each Securityholder thereof and may be made by making such adjustments as the
Corporation deems fair and appropriate in order that only Securities in
denominations of $1,000 or integral multiples thereof shall be prepaid. In the
event of prepayment of this Security in part only, a new Security or Securities
for the portion hereof that has not been prepaid will be issued in the name of
the holder hereof upon the cancellation hereof.
Notwithstanding the foregoing, any prepayment of
Securities by the Corporation shall be subject to the prior approval of the
Board of Governors of the Federal Reserve System (the "Federal Reserve"), if
such approval is then required under applicable capital guidelines or policies
of the Federal Reserve, and the receipt of any other required regulatory
approvals.
In case an Event of Default (as defined in the
Indenture) shall have occurred and be continuing, the principal of all of the
Securities may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.
The Indenture contains provisions permitting the
Corporation and the Debenture Trustee, with the consent of the holders of a
majority in aggregate principal amount of the Securities at the time outstanding
(as defined in the Indenture) to execute supplemental indentures for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
8
<PAGE>
provisions of the Indenture or of modifying in any manner the rights of the
holders of the Securities; PROVIDED, HOWEVER, that no such supplemental
indenture shall, without the consent of each holder of Securities then
outstanding and affected thereby, (i) change the Maturity Date of any
Securities, or reduce the rate or extend the time of payment of interest thereon
(subject to Article XVI of the Indenture), or reduce the principal amount
thereof, or reduce any amount payable on prepayment thereof, or make the
principal thereof, or any interest or premium thereon, payable in any coin or
currency other than that provided in the Securities, or impair or affect the
right of any holder of Securities to institute suit for payment thereof, or (ii)
reduce the aforesaid percentage of Securities, the holders of which are required
to consent to any such supplemental indenture. The Indenture also contains
provisions permitting the holders of a majority in aggregate principal amount of
the Securities at the time outstanding affected thereby, on behalf of all of the
holders of the Securities, to waive any past default in the performance of any
of the covenants contained in the Indenture, or established pursuant to the
Indenture, and its consequences, except a default in the payment of the
principal of or premium, if any, or interest on any of the Securities or a
default in respect of any covenant or provision under which the Indenture cannot
be modified or amended without the consent of each holder of Securities then
outstanding. Any such consent or waiver by the holder of this Security (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Security and of any
Security issued in exchange herefor or in place hereof (whether by registration
of transfer or otherwise), irrespective of whether or not any notation of such
consent or waiver is made upon this Security.
No reference herein to the Indenture and no
provision of this Security or of the Indenture shall alter or impair the
obligation of the Corporation, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest (including Compounded Interest
and Additional Sums, if any) on this Security at the time and place and at the
rate and in the money herein prescribed.
So long as no Event of Default shall have occurred
and be continuing, the Corporation shall have the right, at any time and from
time to time during the term of the Securities, to defer payments of interest by
extending the interest payment period of such Securities for a period not (i)
exceeding 10 consecutive semi-annual periods, including the first such
semi-annual period during such extension period (ii) extending beyond the
Maturity Date of the Securities (an "Extended Interest Payment Period" ) or
(iii) ending on a date other than an Interest Payment Date, at the end of which
period the Corporation shall pay all interest then accrued and unpaid (together
with interest thereon at the rate specified for the Securities to the extent
that payment of such interest is enforceable under applicable
9
<PAGE>
law). Before the termination of any such Extended Interest Payment Period, the
Corporation may further defer payments of interest by further extending such
Extended Interest Payment Period, provided that such Extended Interest Payment
Period, together with all such previous and further extensions within such
Extended Interest Payment Period, (i) shall not exceed 10 consecutive
semi-annual periods, including the first semi-annual period during such Extended
Interest Payment Period, (ii) shall not end on any date other than an Interest
Payment Date, and (iii) shall not extend beyond the Maturity Date of the
Securities. Upon the termination of any such Extended Interest Payment Period
and the payment of all accrued and unpaid interest and any additional amounts
then due, the Corporation may commence a new Extended Interest Payment Period,
subject to the foregoing requirements. No interest shall be due and payable
during an Extended Interest Payment Period, except at the end thereof, but the
Corporation may prepay at any time all or any portion of the interest accrued
during an Extended Interest Payment Period.
The Corporation has agreed that it will not (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, any of the Corporation's capital
stock (which includes common and preferred stock) or (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt securities (including other Debentures) of the Corporation that rank
pari passu with or junior in right of payment to the Securities or (iii) make
any guarantee payments with respect to any guarantee (other than the Capital
Securities Guarantee, as defined in the Indenture) by the Corporation of the
debt securities of any Subsidiary of the Corporation (including Other
Guarantees) if such guarantee ranks PARI PASSU with or junior in right of
payment to the Securities (other than (a) dividends or distributions in shares
of, or options, warrants or rights to subscribe for or purchase shares of,
Common Stock of the Corporation, (b) any declaration of a dividend in connection
with the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future, or the redemption or repurchase of any such
rights pursuant thereto, (c) as a result of a reclassification of the
Corporation's capital stock or the exchange or conversion of one class or series
of the Corporation's capital stock for another class or series of the
Corporation's capital stock, (d) the purchase of fractional interests in shares
of the Corporation's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged
and (e) purchases of Common Stock related to the issuance of Common Stock or
rights under any of the Corporation's benefit or compensation plans for its
directors, officers or employees or any of the Corporation's dividend
reinvestment plans), if at such time (1) there shall have occurred any event of
which the Corporation has actual knowledge that (A) is, or with the giving of
notice or the lapse of time, or both, would constitute a Default or an Event of
Default and (B) in respect of which the Corporation shall not have taken
reasonable steps to cure, (2) if such Securities are held by the Property
Trustee of Banknorth Capital Trust I, the Corporation shall be in default with
respect to its payment of any obligations under the
10
<PAGE>
Capital Securities Guarantee or (3) the Corporation shall have given notice of
its election to exercise its right to commence an Extended Interest Payment
Period, and shall not have rescinded such Notice, and such Extended Interest
Payment Period or any extension thereof shall have commenced and be continuing.
Subject to (i) the receipt of any required
regulatory approval and (ii) the receipt of an opinion of counsel to the effect
that such distribution will not be a taxable event to holders of Capital
Securities, the Corporation will have the right at any time to liquidate the
Trust and cause the Securities to be distributed to the holders of the Trust
Securities in liquidation of the Trust.
The Securities are issuable only in registered
form without coupons in minimum denominations of $100,000 and multiples of
$1,000 in excess thereof. As provided in the Indenture and subject to the
transfer restrictions limitations as may be contained herein and therein from
time to time, this Security is transferable by the holder hereof on the Security
Register of the Corporation, upon surrender of this Security for registration of
transfer at the office or agency of the Corporation in New York, New York
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Corporation or the Debenture Trustee duly executed by the
holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of authorized denominations and for the same aggregate
principal amount will be issued to the designated transferee or transferees.
No service charge will be made for any such registration of transfer, but the
Corporation may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Prior to due presentment for registration of
transfer of this Security, the Corporation, the Debenture Trustee, any
authenticating agent, any paying agent, any transfer agent and the security
registrar may deem and treat the holder hereof as the absolute owner hereof
(whether or not this Security shall be overdue and notwithstanding any notice of
ownership or writing hereon made by anyone other than the security registrar for
the Securities) for the purpose of receiving payment of or on account of the
principal hereof and premium, if any, and (subject to the Indenture) interest
due hereon and for all other purposes, and neither the Corporation nor the
Debenture Trustee nor any authenticating agent nor any paying agent nor any
transfer agent nor any security registrar shall be affected by any notice to the
contrary.
No recourse shall be had for the payment of the
principal of or premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) on this Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture, against
any incorporator,
11
<PAGE>
stockholder, employee, officer or director, past, present or future, as such, of
the Corporation or of any predecessor or successor Person, whether by virtue of
any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
All terms used but not defined in this Security
that are defined in the Indenture shall have the meanings assigned
to them in the Indenture.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO CONFLICT OF LAW PRINCIPLES.
12
<PAGE>
State of Delaware
Office of the Secretary of State
I, EDWARD J.FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF BUSINESS
TRUST REGISTRATION OF "BANKNORTH CAPITAL TRUST I" FILED IN THIS OFFICE ON THE
NINTH DAY OF APRIL, A.D. 1997, AT 11:30 0'CLOCK A.M.
(seal appears here) /s/ Edward J. Freel
Edward J. Freel, Secretary of State
AUTHENTICATION: 8412696
2738647 8100 04-09-97
971114867 DATE:
<PAGE>
CERTIFICATE OF TRUST
OF
BANKNORTH CAPITAL TRUST I
THIS Certificate of Trust of Banknorth Capital I (the "Trust"), dated April 9,
1997, is being duly executed and filed by The First National Bank of Chicago, a
national banking association, First Chicago Delaware Inc., a Delaware
corporation, Thomas J. Pruitt, Neal R. Robinson and James D. Adams, as trustees,
with the Secretary of State of the State of Delaware to form a business trust
under the Delaware Business Act (12 Del.C.ss. 3801 et seq.).
1. Name. The name of the business trust formed hereby
is Banknorth Capital Trust I.
2. Delaware Trustees. The name and business address of the
trustee of the Trust in the State of Delaware is First Chicago Delaware Inc.,
300 King Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall
be effective upon filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the trust, have
executed this Certificate of Trust as of the date above written.
THE FIRST NATIONAL BANK OF
CHICAGO, as trustee
By: /s/Richard D. Manella
Name: Richard D. Manella
Title: Vice President
FIRST CHICAGO DELAWARE INC., as
trustee
By: /s/Richard D. Manella
Name Richard D. Manella
Title: Vice President
<PAGE>
/s/ Thomas J. Pruitt
THOMAS J. PRUITT, as trustee
/s/ Neal E. Robinson
NEAL E. ROBINSON, as trustee
/s/ James D. Adams
JAMES D. ADAMS, as trustee
<PAGE>
DECLARATION OF TRUST
This Declaration of Trust, dated as of April 9, 1997 (this "Declaration of
Trust"), among (i) Banknorth Group, Inc., a Delaware corporation, as sponsor
(the "Sponsor"), (ii) The First National Bank of Chicago, a national banking
association, as property trustee (the "Property Trustee"), (iii) First Chicago
Delaware Inc., a Delaware corporation, as trustee (the "Delaware Trustee"), and
(iv) Thomas J. Pruitt, Neal E. Robinson and James D. Adams, each an individual,
as trustees (each an "Administrative Trustee") (each of such trustees in (ii),
(iii) and (iv) a "Trustee" and collectively, the "Trustees"). The Sponsor and
the Trustees hereby agree as follows:
1.The trust created hereby (the "Trust") shall be known as
"Banknorth Capital Trust I" in which name the Trustees, or the Sponsor to the
extent provided herein, may engage in the transactions contemplated hereby, make
and execute contracts, and sue and be sued.
2. The Sponsor hereby assigns, transfers conveys and sets over to
the Trust the sum of $10. The Trustees hereby acknowledge receipt of such amount
in trust from the Sponsor, which amount shall constitute the initial trust
estate. The Trustees hereby declare that they will hold the trust estate in
trust for the Sponsor. 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. The
Trustees 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.
3. The Sponsor and the Trustees will enter into an amended and
restated Declaration of Trust, satisfactory to each such party, to provide for
the contemplated operation of the Trust created hereby and the issuance of the
Capital Securities and Common Securities referred to therein. Prior to the
execution and delivery of such amended and restated Declaration of Trust, the
Trustees 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 of any licenses,
consents or approvals required by applicable law or otherwise.
4. The Sponsor and the Trustees hereby authorize and direct the
Sponsor, as the sponsor of the Trust, (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 other 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 Sponsor, on
behalf of the Trust, may deem necessary or
<PAGE>
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 and, if and at such time as determined by
the Sponsor, to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing or quotation of the Capital Securities
of the Trust; (iv) to execute and deliver letters or documents to, or
instruments for filing 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 and other
related agreements providing for or relating to the sale of the Capital
Securities of the Trust.
5. This Declaration of Trust may be executed in one or more
counterparts.
6. The number of Trustees initially shall be five (5) 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 Sponsor which 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 the State 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
Sponsor is entitled to appoint or remove without cause any Trustee at any time.
The Trustees may resign upon thirty (30) days' prior notice to the Sponsor.
7. First Chicago Delaware Inc., in its capacity as Trustee, shall
not have the powers or duties of the Trustees set forth herein (except as may be
required under the Business Trust Act) and shall be a trustee hereunder for the
sole and limited purpose of fulfilling the requirements of Section 3807 of the
Business Trust Act.
8. This Declaration of Trust shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws of principles).
2
<PAGE>
IN WITNESS WHEREOF, The parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.
BANKNORTH GROUP, INC.,
as Sponsor
By: /s/ William H. Chadwick
----------------------------------------
Name: William H. Chadwick
Title: President & Chief Executive
Officer
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By:
----------------------------------------
Name:
Title:
FIRST CHICAGO DELAWARE INC.,
as Delaware Trustee
By:
----------------------------------------
Name:
Title:
/s/ Thomas J. Pruitt
--------------------------------------------
Thomas J. Pruitt, as Administrative Trustee
/s/ Neal E. Robinson
--------------------------------------------
Neal E. Robinson, as Administrative Trustee
/s/ James D. Adams
--------------------------------------------
James D. Adams, as Administrative Trustee
3
<PAGE>
EXHIBIT 4.5
AMENDED AND RESTATED DECLARATION
OF TRUST
OF
BANKNORTH CAPITAL TRUST I
Dated as of May 1, 1997
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
<S> <C> <C>
SECTION 1.1 Definitions.......................................................................... 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application..................................................... 11
SECTION 2.2 Lists of Holders of Securities....................................................... 11
SECTION 2.3 Reports by the Property Trustee...................................................... 12
SECTION 2.4 Periodic Reports to Property Trustee................................................. 12
SECTION 2.5 Evidence of Compliance with Conditions
Precedent............................................................................ 12
SECTION 2.6 Events of Default; Waiver............................................................ 12
SECTION 2.7 Default; Notice...................................................................... 14
ARTICLE III
ORGANIZATION
SECTION 3.1 Name................................................................................. 15
SECTION 3.2 Office............................................................................... 15
SECTION 3.3 Purpose.............................................................................. 15
SECTION 3.4 Authority............................................................................ 16
SECTION 3.5 Title to Property of the Trust....................................................... 16
SECTION 3.6 Powers and Duties of the Administrative
Trustees............................................................................. 16
SECTION 3.7 Prohibition of Actions by the Trust and
the Trustees......................................................................... 20
SECTION 3.8 Powers and Duties of the Property
Trustee.............................................................................. 21
SECTION 3.9 Certain Duties and Responsibilities of
the Property Trustee................................................................. 23
SECTION 3.10 Certain Rights of Property Trustee................................................... 25
SECTION 3.11 Delaware Trustee..................................................................... 28
SECTION 3.12 Execution of Documents............................................................... 28
SECTION 3.13 Not Responsible for Recitals or Issuance
of Securities........................................................................ 28
SECTION 3.14 Duration of Trust.................................................................... 28
SECTION 3.15 Mergers.............................................................................. 29
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.............................................. 31
SECTION 4.2 Responsibilities of the Sponsor...................................................... 31
SECTION 4.3 Right to Proceed..................................................................... 32
SECTION 4.4 Right to Terminate Trust............................................................. 32
i
<PAGE>
Page
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-
Trustee.............................................................................. 32
SECTION 5.2 Delaware Trustee..................................................................... 33
SECTION 5.3 Property Trustee; Eligibility........................................................ 33
SECTION 5.4 Certain Qualifications of Administrative
Trustees and Delaware Trustee Generally.............................................. 34
SECTION 5.5 Administrative Trustees.............................................................. 35
SECTION 5.6 Appointment, Removal and Resignation of
Trustees............................................................................. 36
SECTION 5.7 Vacancies among Trustees............................................................. 37
SECTION 5.8 Effect of Vacancies.................................................................. 38
SECTION 5.9 Meetings............................................................................. 38
SECTION 5.10 Delegation of Power.................................................................. 39
SECTION 5.11 Merger, Conversion, Consolidation or
Succession to Business............................................................... 39
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions........................................................................ 39
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.............................................. 40
SECTION 7.2 Execution and Authentication......................................................... 40
SECTION 7.3 Form and Dating...................................................................... 41
SECTION 7.4 Registrar, Paying Agent and Exchange
Agent................................................................................ 43
SECTION 7.5 Paying Agent to Hold Money in Trust.................................................. 44
SECTION 7.6 Replacement Securities............................................................... 44
SECTION 7.7 Outstanding Capital Securities....................................................... 44
SECTION 7.8 Capital Securities in Treasury....................................................... 45
SECTION 7.9 Temporary Securities................................................................. 45
SECTION 7.10 Cancellation......................................................................... 46
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust................................................................. 47
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities............................................................... 48
SECTION 9.2 Transfer Procedures and Restrictions................................................. 49
SECTION 9.3 Deemed Security Holders.............................................................. 58
ii
<PAGE>
Page
SECTION 9.4 Book-Entry Interests................................................................. 59
SECTION 9.5 Notices to Clearing Agency........................................................... 59
SECTION 9.6 Appointment of Successor Clearing Agen-
cy................................................................................... 59
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability............................................................................ 60
SECTION 10.2 Exculpation.......................................................................... 60
SECTION 10.3 Fiduciary Duty....................................................................... 61
SECTION 10.4 Indemnification...................................................................... 62
SECTION 10.5 Outside Businesses................................................................... 65
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.......................................................................... 66
SECTION 11.2 Certain Accounting Matters........................................................... 66
SECTION 11.3 Banking.............................................................................. 67
SECTION 11.4 Withholding.......................................................................... 67
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments........................................................................... 67
SECTION 12.2 Meetings of the Holders; Action by
Written Consent...................................................................... 70
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Prop-
erty Trustee......................................................................... 71
SECTION 13.2 Representations and Warranties of Dela-
ware Trustee......................................................................... 72
ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 Registration Rights Agreement;
Liquidated Damages................................................................... 73
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices.............................................................................. 75
SECTION 15.2 Governing Law........................................................................ 77
iii
<PAGE>
Page
SECTION 15.3 Intention of the Parties............................................................. 77
SECTION 15.4 Headings............................................................................. 77
SECTION 15.5 Successors and Assigns............................................................... 77
SECTION 15.6 Partial Enforceability............................................................... 77
SECTION 15.7 Counterparts......................................................................... 77
ANNEX I TERMS OF SECURITIES...........................................................................I-1
EXHIBIT A-1 FORM OF CAPITAL SECURITY CERTIFICATE........................................................ A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE......................................................... A2-4
</TABLE>
iv
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
310(a)......................................... 5.3
310(b)......................................... 5.3(c), 5.3(d)
311(a)......................................... 2.2(b)
311(b)......................................... 2.2(b)
312(a)......................................... 2.2(a)
312(b)......................................... 2.2(b)
313............................................ 2.3
314(a)......................................... 2.4; 3.6(j)
314(c)......................................... 2.5
315(a)......................................... 3.9
315(b)......................................... 2.7(a)
315(c)......................................... 3.9(a)
315(d)......................................... 3.9(b)
316(a)......................................... 2.6
316(c)......................................... 3.6(e)
317(a)......................................... 3.8(e); 3.8(h)
317(b)......................................... 3.8(i); 7.5
- ---------------
* This Cross-Reference Table does not constitute part of the Declaration
and shall not affect the interpretation of any of its terms or
provisions.
v
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
BANKNORTH CAPITAL TRUST I
Dated as of May 1, 1997
AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated and effective as of May 1, 1997, by the Trustees (as defined herein), the
Sponsor (as defined herein) and by the holders, from time to time, of undivided
beneficial interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established Banknorth
Capital Trust I (the "Trust"), a trust formed under the Delaware Business Trust
Act pursuant to a Declaration of Trust dated as of April 9, 1997 (the "Original
Declaration"), and a Certificate of Trust filed with the Secretary of State of
the State of Delaware on April 9, 1997, for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust, investing the proceeds thereof in certain Debentures of the
Debenture Issuer (each as hereinafter defined), and engaging in only those
activities necessary, advisable or incidental thereto;
WHEREAS, prior to the date hereof, no interests in the
Trust have been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration; and
NOW, THEREFORE, it being the intention of the parties hereto
to continue the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration and, in consideration
of the mutual covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the Trustees,
intending to be legally bound hereby, agree as follows:
<PAGE>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not defined
in the preamble above or elsewhere herein have the respective meanings
assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has
the same meaning throughout;
(c) all references to "the Declaration" or "this Declaration"
are to this Declaration and each Annex and Exhibit hereto, as modified,
supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections and Annexes and Exhibits are to Articles and Sections of and
Annexes and Exhibits to this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Declaration unless otherwise defined in this
Declaration or unless the context otherwise requires;
(f) a term defined in the Indenture (as defined herein) has
the same meaning when used in this Declaration unless otherwise defined
in this Declaration or the context otherwise requires; and
(g) a reference to the singular includes the plural
and vice versa.
"Administrative Trustee" has the meaning set forth in
Section 5.1.
"Affiliate" has the same meaning as given to that term in Rule
405 under the Securities Act or any successor rule there- under.
"Agent" means any Paying Agent, Registrar or Exchange
Agent.
"Authorized Officer" of a Person means any other Person that
is authorized to legally bind such former Person.
"Book-Entry Interest" means a beneficial interest in
the Global Capital Security registered in the name of a Clearing
2
<PAGE>
Agency or its nominee, ownership and transfers of which shall be maintained and
made through book entries by a Clearing Agency as described in Section 9.4.
"Business Day" means any day other than a Saturday or a Sunday
or a day on which banking institutions in The City of New York or Burlington,
Vermont are authorized or required by law or executive order to remain closed.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as it may be amended from time to
time, or any successor legislation.
"Capital Security Beneficial Owner" means, with respect to a
Book-Entry Interest, a Person who is the beneficial owner of such Book-Entry
Interest, as reflected on the books of the Clearing Agency, or on the books of a
Person maintaining an account with such Clearing Agency (directly as a Clearing
Agency Participant or as an indirect participant, in each case in accordance
with the rules of such Clearing Agency).
"Capital Security Certificate" has the meaning set
forth in Section 9.4.
"Capital Securities" means, collectively, the Series A Capital
Securities and the Series B Capital Securities, representing undivided preferred
beneficial interests in the assets of the Trust and having such terms as are set
forth in this Declaration.
"Capital Securities Guarantee" means, collectively, the Series
A Capital Securities Guarantee and the Series B Capital Securities Guarantee.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Capital Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and which
shall undertake to effect book entry transfers and pledges of the Capital
Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Time" means the "Closing Time" as defined in
the Purchase Agreement.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation.
3
<PAGE>
"Commission" means the United States Securities and Exchange
Commission as from time to time constituted, or if at any time after the
execution of this Declaration such Commission is not existing and performing the
duties now assigned to it under applicable federal securities laws, then the
body performing such duties at such time.
"Common Securities" has the meaning specified in
Section 7.1(a).
"Common Securities Guarantee" means the Common
Securities Guarantee Agreement, dated as of the Closing Time, of
Banknorth Group, Inc. in respect of the Common Securities.
"Common Securities Subscription Agreement" means the Common
Securities Subscription Agreement, dated as of the Closing Time, between the
Trust and the Banknorth Group, Inc., relating to the Common Securities.
"Company Indemnified Person" means (a) any Administrative
Trustee; (b) any Affiliate of any Administrative Trustee; (c) any officers,
directors, shareholders, members, partners, employees, representatives or agents
of any Administrative Trustee; or (d) any officer, employee or agent of the
Trust or its Affiliates.
"Corporate Trust Office" means the office of the Property
Trustee at which the corporate trust business of the Property Trustee shall, at
any particular time, be principally administered, which office at the date of
execution of this Agreement is located at One First National Plaza, Suite 0126,
Chicago, Illinois 60670.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent of (i) the Trust
or (ii) the Trust's Affiliates; and (b) any Holder of Securities.
"Debenture Issuer" means Banknorth Group, Inc., a Delaware
corporation, or any successor entity resulting from any consolidation,
amalgamation, merger or other business combination, in its capacity as issuer of
the Debentures under the Indenture.
"Debenture Subscription Agreement" means the Debenture
Subscription Agreement, dated as of the Closing Time, between the Debenture
Issuer and the Trust in respect of the Series A Debentures.
"Debenture Trustee" means The First National Bank of
Chicago, an national banking association, as trustee under the
4
<PAGE>
Indenture until a successor is appointed thereunder, and thereafter means such
successor trustee.
"Debentures" means, collectively, the Series A Debentures and
the Series B Debentures issued pursuant to the Indenture.
"Default" means an event, act or condition that with notice or
lapse of time, or both, would constitute an Event of Default.
"Definitive Capital Securities" has the meaning set
forth in Section 7.3(c).
"Delaware Trustee" has the meaning set forth in Section
5.1.
"Direct Action" has the meaning set forth in Section
3.8(e).
"Distribution" means a distribution payable to Holders
in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
"Event of Default" in respect of the Securities means an Event
of Default (as defined in the Indenture) that has occurred and is continuing in
respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Exchange Agent" has the meaning set forth in Section
7.4.
"Exchange Offer" means the offer that may be made pursuant to
the Registration Rights Agreement (i) by the Trust to exchange Series B Capital
Securities for Series A Capital Securities and (ii) by the Debenture Issuer to
exchange Series B Debentures for Series A Debentures and to execute the Series B
Capital Securities Guarantee in respect of the Series B Capital Securities.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System.
"Fiduciary Indemnified Person" has the meaning set
forth in Section 10.4(b).
"Fiscal Year" has the meaning set forth in Section
11.1.
5
<PAGE>
"Global Capital Security" has the meaning set forth in
Section 7.3(a).
"Holder" means a Person in whose name a Security or Successor
Security is registered, such Person being a beneficial owner within the meaning
of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person
or a Fiduciary Indemnified Person.
"Indenture" means the Indenture, dated as of the Closing Time,
between the Debenture Issuer and the Debenture Trustee, as amended from time to
time.
"Initial Optional Redemption Date" has the meaning set forth
in Section 4(b) of Annex I hereto.
"Investment Company" means an investment company as
defined in the Investment Company Act.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Legal Action" has the meaning set forth in Section
3.6(g).
"Like Amount" has the meaning set forth in Section 3 of
Annex I hereto.
"List of Holders" has the meaning set forth in Section
2.2(a).
"Majority in liquidation amount" means, with respect to the
Trust Securities, except as provided in the terms of the Capital Securities or
by the Trust Indenture Act, Holders of outstanding Trust Securities voting
together as a single class or, as the context may require, Holders of
outstanding Capital Securities or Holders of outstanding Common Securities
voting separately as a class, who are the record owners of more than 50% of the
aggregate liquidation amount (including the amount that would be paid on
redemption, liquidation or otherwise, plus accumulated and unpaid Distributions
to the date upon which the voting percentages are determined) of all outstanding
Securities of the relevant class.
"Offering Memorandum" has the meaning set forth in
Section 3.6(b)(i).
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman, the Chief Executive Officer, the President,
an Executive or Senior Vice President, a
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Vice President, the Chief Financial Officer, the Secretary or an Assistant
Secretary. Any Officers' Certificate delivered by the Trust shall be signed by
at least one Administrative Trustee. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that each officer signing the Certifi-
cate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in
rendering the Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each
such officer, such condition or covenant has been complied
with.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of the Sponsor, and who shall be acceptable to the Property
Trustee.
"Participants" has the meaning specified in Section
7.3(b).
"Paying Agent" has the meaning specified in Section
7.4.
"Payment Amount" has the meaning specified in Section
6.1.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"PORTAL" has the meaning set forth in Section
3.6(b)(iii).
"Property Trustee" has the meaning set forth in Section
5.3(a).
"Property Trustee Account" has the meaning set forth in
Section 3.8(c)(i).
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"Purchase Agreement" means the Purchase Agreement, dated April
28, 1997, by and among the Trust, the Debenture Issuer and the Initial Purchaser
named therein.
"QIBs" shall mean qualified institutional buyers as
defined in Rule 144A.
"Quorum" means a majority of the Administrative Trustees or,
if there are only two Administrative Trustees, both of them.
"Registrar" has the meaning set forth in Section 7.4.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Closing Time, by and among the Trust, the Debenture
Issuer and the Initial Purchaser named therein, as amended from time to time.
"Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Regulatory Capital Event" has the meaning set forth in
Section 4(c) of Annex I hereto.
"Related Party" means, with respect to the Sponsor, any direct
or indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"Responsible Officer" means any officer within the Corporate
Trust Office of the Property Trustee with direct responsibility for the
administration of this Declaration and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.
"Restricted Definitive Capital Securities" has the
meaning set forth in Section 7.3(c).
"Restricted Capital Security" means a Capital Security
required by Section 9.2 to contain a Restricted Securities
Legend.
"Restricted Securities Legend" has the meaning set
forth in Section 9.2(i).
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act,
or any successor rule or regulation.
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"Rule 144" means Rule 144 under the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Rule 144A" means Rule 144A under the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"Securities" or "Trust Securities" means the Common
Securities and the Capital Securities.
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities
Guarantee and the Capital Securities Guarantee.
"Series A Capital Securities" has the meaning specified
in Section 7.1(a).
"Series A Capital Securities Guarantee" means the Series A
Capital Securities Guarantee Agreement, dated as of the Closing Time, by
Banknorth Group, Inc., in respect of the Series A Capital Securities.
"Series A Debentures" means the 10.52% Junior Subordinated
Deferrable Interest Debentures due May 1, 2027, Series A, of the Debenture
Issuer issued pursuant to the Indenture.
"Series B Capital Securities" has the meaning specified
in Section 7.1(a).
"Series B Capital Securities Guarantee" means the Series B
Capital Securities Guarantee Agreement to be entered into in connection with the
Exchange Offer by Banknorth Group, Inc., in respect of the Series B Capital
Securities.
"Series B Debentures" means the 10.52% Junior Subordinated
Deferrable Interest Debentures due May 1, 2027, Series B, of the Debenture
Issuer to be issued pursuant to the Indenture in connection with the Exchange
Offer.
"Special Event" has the meaning set forth in Section
4(c) of Annex I hereto.
"Special Event Redemption Price" has the meaning set forth in
Section 4(c) of Annex I hereto.
"Sponsor" means Banknorth Group, Inc., a Delaware corporation,
or any successor entity resulting from any merger, consolidation, amalgamation
or other business combination, in its capacity as sponsor of the Trust.
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"Successor Delaware Trustee" has the meaning set forth
in Section 5.6(b)(ii).
"Successor Entity" has the meaning set forth in Section
3.15(b)(i).
"Successor Property Trustee" has the meaning set forth
in Section 3.8(f)(ii).
"Successor Securities" has the meaning set forth in
Section 3.15(b)(i).
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" has the meaning set forth in Section 4(c)
of Annex I hereto.
"10% in liquidation amount" means, with respect to the Trust
Securities, except as provided in the terms of the Capital Securities or by the
Trust Indenture Act, Holders of outstanding Trust Securities voting together as
a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a
class, who are the record owners of 10% or more of the aggregate liquidation
amount (including the amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which the
voting percentages are determined) of all outstanding Securities of the relevant
class.
"Treasury Regulations" means the income tax regulations,
including temporary and proposed regulations, promulgated under the Code by the
United States Treasury, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue as a trustee of
the Trust in accordance with the terms hereof, and all other Persons who may
from time to time be duly appointed, qualified and serving as Trustees in
accordance with the provisions hereof, and references herein to a Trustee or the
Trustees shall refer to such Person or Persons solely in their capacity as
trustees hereunder.
"Trust Property" means (a) the Debentures, (b) any cash on
deposit in, or owing to the Property Trustee Account and (c) all proceeds and
rights in respect of the foregoing and any other
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property and assets for the time being held or deemed to be held by the Property
Trustee pursuant to this Declaration.
"Unrestricted Global Capital Security" has the meaning
set forth in Section 9.2(b).
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration in order for this
Declaration to be qualified under the Trust Indenture Act and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee
which is a Trustee for the purposes of the Trust Indenture Act.
(c) If and to the extent that any provision of this
Declaration limits, qualifies or conflicts with the duties imposed by ss.ss. 310
to 317, inclusive, of the Trust Indenture Act, such imposed duties shall
control.
(d) The application of the Trust Indenture Act to this
Declaration shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide the Property Trustee, unless the Property
Trustee is Registrar for the Securities, (i) within 14 days after each record
date for payment of Distributions, a list, in such form as the Property Trustee
may reasonably require, of the names and addresses of the Holders ("List of
Holders") as of such record date, provided that neither the Sponsor nor the
Administrative Trustees on behalf of the Trust shall be obligated to provide
such List of Holders at any time that the List of Holders does not differ from
the most recent List of Holders given to the Property Trustee by the Sponsor and
the Administrative Trustees on behalf of the Trust, and (ii) at any other time,
within 30 days of receipt by the Trust of a written request for a List of
Holders as of a date no more than 14 days before such List of Holders is given
to the Property Trustee. The Property Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it or which it receives in the capacity as Paying Agent (if acting in
such capacity),
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provided that the Property Trustee may destroy any List of Holders previously
given to it on receipt of a new List of Holders.
(b) The Property Trustee shall comply with its obligations
under ss.ss. 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after May 1 of each year, commencing May 1,
1998, the Property Trustee shall provide to the Holders of the Capital
Securities such reports as are required by ss. 313 of the Trust Indenture Act,
if any, in the form and in the manner provided by ss. 313 of the Trust Indenture
Act. The Property Trustee shall also comply with the requirements of ss. 313(d)
of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide to the Property Trustee such documents, reports and
information as are required by ss. 314 (if any) of the Trust Indenture Act and
the compliance certificate required by ss. 314 of the Trust Indenture Act in the
form, in the manner and at the times required by ss. 314 of the Trust Indenture
Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Administrative Trustees on behalf
of the Trust shall provide to the Property Trustee such evidence of compliance
with any conditions precedent provided for in this Declaration that relate to
any of the matters set forth in ss. 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to ss.
314(c)(1) of the Trust Indenture Act may be given in the form of an Officers'
Certificate.
SECTION 2.6 Events of Default; Waiver.
(a) The Holders of a Majority in liquidation amount of Capital
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default in respect of the Capital Securities
and its consequences, provided that, if the underlying Event of Default under
the Indenture:
(i) is not waivable under the Indenture, the Event
of Default under the Declaration shall also not be waivable;
or
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(ii) requires the consent or vote of greater than a majority
in aggregate principal amount of the holders of the Debentures (a
"Super Majority") to be waived under the Indenture, the Event of
Default under the Declaration may only be waived by the vote of the
Holders of at least the proportion in aggregate liquidation amount of
the Capital Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of ss.
316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the Trust
Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such
Default shall cease to exist, and any Event of Default with respect to the
Capital Securities arising therefrom shall be deemed to have been cured, for
every purpose of this Declaration, but no such waiver shall extend to any
subsequent or other Default or an Event of Default with respect to the Capital
Securities or impair any right consequent thereon. Any waiver by the Holders of
the Capital Securities of an Event of Default with respect to the Capital
Securities shall also be deemed to constitute a waiver by the Holders of the
Common Securities of any such Event of Default with respect to the Common
Securities for all purposes of this Declaration without any further act, vote,
or consent of the Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount of the
Common Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, provided that, if the underlying Event of
Default under the Indenture:
(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event
of Default under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration shall also not be
waivable; or
(ii) requires the consent or vote of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to
have waived such Event of Default under the Declaration as provided
below in this Section 2.6(b), the Event of Default under the
Declaration may only be waived by the vote of the Holders of at least
the proportion in aggregate liquidation amount of the Common Securities
that the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
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provided further, each Holder of Common Securities will be deemed to have waived
any such Event of Default and all Events of Default with respect to the Common
Securities and their consequences if all Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated, and until
such Events of Default have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of
ss.ss. 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such ss.ss.
316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon
such waiver, any such Default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to
any subsequent or other Default or Event of Default with respect to the Common
Securities or impair any right consequent thereon.
(c) A waiver of an Event of Default under the Indenture by the
Property Trustee, at the direction of the Holders of the Capital Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu of
ss. 316(a)(1)(B) of the Trust Indenture Act and such ss. 316(a)(1)(B) of the
Trust Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act.
SECTION 2.7 Default; Notice.
(a) The Property Trustee shall, within 90 days after a
Responsible Officer obtains actual knowledge of the occurrence of a Default with
respect to the Securities, transmit by mail, first class postage prepaid, to the
Holders, notices of all such Defaults, unless such Defaults have been cured
before the giving of such notice or previously waived; provided, however, that
except in the case of a Default arising from the nonpayment of principal of (or
premium, if any) or interest (including Compounded Interest and Additional Sums
(as such terms are defined in the Indenture), if any) or Liquidated Damages (as
defined in the Registration Rights Agreement) on any of the Debentures, the
Property Trustee shall be protected in withholding such notice if and so long as
a Responsible Officer in good faith determines that the withholding of such
notice is in the interests of the Holders.
(b) The Property Trustee shall not be deemed to have knowledge
of any Default or Event of Default except:
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(i) a Default under Sections 5.01(a) (other than the
payment of Compounded Interest, Additional Sums and Liqui-
dated Damages) and 5.01(b) of the Indenture; or
(ii) any Default or Event of Default as to which the Property
Trustee shall have received written notice or of which a Responsible
Officer charged with the administration of the Declaration shall have
actual knowledge.
(c) Within ten Business Days after the occurrence of any Event
of Default actually known to the Property Trustee, the Property Trustee shall
transmit notice of such Event of Default to the Holders of the Capital
Securities, the Administrative Trustees and the Sponsor, unless such Event of
Default shall have been cured or waived. The Sponsor and the Administrative
Trustees shall file annually with the Property Trustee a certification as to
whether or not they are in compliance with all the conditions and covenants
applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "Banknorth Capital Trust I" as such name
may be modified from time to time by the Administrative Trustees following
written notice to the Delaware Trustee, the Property Trustee and the Holders.
The Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o
Banknorth Group, Inc., 300 Financial Plaza, P.O. Box 5420, Burlington, Vermont,
05401. On ten Business Days' prior written notice to the Delaware Trustee, the
Property Trustee and the Holders of Securities, the Administrative Trustees may
designate another principal office.
SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell Securities, (b) use the proceeds from the sale of the Securities
to acquire the Debentures, and (c) except as otherwise limited herein, to engage
in only those other activities necessary, advisable or incidental thereto,
including without limitation, those activities specified in Section 3.6. The
Trust shall not borrow money, issue debt or reinvest proceeds derived from
investments, mortgage or pledge any of its assets, or otherwise undertake (or
permit to be undertaken) any activity
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that would cause the Trust not to be classified for United States federal income
tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Administrative Trustees shall
have exclusive and complete authority to carry out the purposes of the Trust. An
action taken by one or more of the Administrative Trustees in accordance with
their powers shall constitute the act of and serve to bind the Trust and an
action taken by the Property Trustee on behalf of the Trust in accordance with
its powers shall constitute the act of and serve to bind the Trust. In dealing
with the Trustees acting on behalf of the Trust, no Person shall be required to
inquire into the authority of the Trustees to bind the Trust. Persons dealing
with the Trust are entitled to rely conclusively on the power and authority of
the Trustees as set forth in this Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the
Trust.
SECTION 3.6 Powers and Duties of the Administrative Trustees.
The Administrative Trustees shall have the exclusive power,
duty and authority, and are hereby authorized and directed, to cause the Trust
to engage in the following activities:
(a) to execute, enter into and deliver the Common Securities
Subscription Agreement and to execute, deliver, issue and sell the Securities in
accordance with this Declaration; provided, however, that except as contemplated
in Section 7.1(a), (i) the Trust may issue no more than one series of Capital
Securities and no more than one series of Common Securities, (ii) there shall be
no interests in the Trust other than the Securities, and (iii) the issuance of
Securities shall be limited to a simultaneous issuance of both Capital
Securities and Common Securities at the Closing Time;
(b) in connection with the issue and sale of the
Capital Securities and the consummation of the Exchange Offer, at
the direction of the Sponsor, to:
(i) prepare and execute, if necessary, an offering
memorandum (the "Offering Memorandum") in preliminary and
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final form prepared by the Sponsor, in relation to the offering and
sale of Series A Capital Securities to QIBs in reliance on Rule 144A
under the Securities Act and to institutional "accredited investors"
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act), and to execute and file with the Commission, at such time as
determined by the Sponsor, any Registration Statement, including any
amendments thereto, as contemplated by the Registration Rights
Agreement;
(ii) execute and file any documents prepared by the Sponsor,
or take any acts as determined by the Sponsor to be necessary in order
to qualify or register all or part of the Capital Securities in any
State in which the Sponsor has determined to qualify or register such
Capital Securities for sale;
(iii) execute and file an application, prepared by the
Sponsor, to permit the Capital Securities to trade or be quoted or
listed in or on the Private Offerings, Resales and Trading through
Automated Linkages ("PORTAL") Market or any other securities exchange,
quotation system or the Nasdaq Stock Market's National Market;
(iv) execute and deliver letters, documents, or
instruments with DTC and other Clearing Agencies relating to
the Capital Securities;
(v) if required, execute and file with the Commission a
registration statement on Form 8-A, including any amendments thereto,
prepared by the Sponsor, relating to the registration of the Capital
Securities under Section 12(b) or 12(g) of the Exchange Act, as the
case may be; and
(vi) execute, enter into and deliver the Purchase Agreement
and the Registration Rights Agreement providing for, among other
things, the sale and registration of the
Capital Securities;
(c) to execute, enter into and deliver the Debenture
Subscription Agreement, to acquire the Series A Debentures with the proceeds of
the sale of the Series A Capital Securities and the Common Securities and to
exchange the Series A Debentures for a like principal amount of Series B
Debentures, pursuant to the Exchange Offer; provided, however, that the
Administrative Trustees shall cause legal title to the Debentures to be held of
record in the name of the Property Trustee for the benefit of the Holders;
(d) to give the Sponsor and the Property Trustee
prompt written notice of the occurrence of a Special Event;
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(e) to establish a record date with respect to all actions to
be taken hereunder that require a record date be established, including and with
respect to, for the purposes of ss. 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(f) to take all actions and perform such duties as
may be required of the Administrative Trustees pursuant to the
terms of the Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate,
resort to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee
has the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and managers, contractors, advisors,
and consultants and pay reasonable compensation for such services;
(i) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(j) to give the certificate required by ss. 314(a)(4)
of the Trust Indenture Act to the Property Trustee, which certif-
icate may be executed by any Administrative Trustee;
(k) to incur expenses that are necessary or inciden-
tal to carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, Registrar
and Exchange Agent for the Securities or to appoint a Paying Agent for the
Securities as provided in Section 7.4 except for such time as such power to
appoint a Paying Agent is vested in the Property Trustee;
(m) to give prompt written notice to the Property Trustee and
to Holders of any notice received from the Debenture Issuer of its election to
defer payments of interest on the Debentures by extending the interest payment
period under the Indenture;
(n) to take all action that may be necessary or appropriate
for the preservation and the continuation of the Trust's valid existence,
rights, franchises and privileges as a statutory business trust under the laws
of the State of Delaware and of each other jurisdiction in which such existence
is necessary to protect the limited liability of the Holders or to enable
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the Trust to effect the purposes for which the Trust was created;
(o) to take any action, not inconsistent with this Declaration
or with applicable law, that the Administrative Trustees determine in their
discretion to be necessary or desirable in carrying out the activities of the
Trust as set out in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an In-
vestment Company required to be registered under the Invest-
ment Company Act;
(ii) causing the Trust to be classified for United
States federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer for
United States federal income tax purposes;
(p) to take all action necessary to consummate the Exchange
Offer or otherwise cause the Capital Securities to be registered pursuant to an
effective registration statement in accordance with the provisions of the
Registration Rights Agreement;
(q) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with respect
to the Trust to be duly prepared and filed by the Administrative Trustees, on
behalf of the Trust; and
(r) to execute all documents or instruments, perform all
duties and powers, and do all things for and on behalf of the Trust in all
matters necessary, advisable or incidental to the foregoing.
The Administrative Trustees must exercise the powers set forth
in this Section 3.6 in a manner that is consistent with the purposes and
functions of the Trust set out in Section 3.3, and the Administrative Trustees
shall not take any action that is inconsistent with the purposes and functions
of the Trust set forth in Section 3.3.
Subject to this Section 3.6, the Administrative Trustees shall
have none of the powers or the authority of the Property Trustee set forth in
Section 3.8.
Any expenses incurred by the Administrative Trustees pursuant
to this Section 3.6 shall be reimbursed by the Debenture Issuer.
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SECTION 3.7 Prohibition of Actions by the Trust and the
Trustees.
The Trust shall not, and the Trustees (including the Property
Trustee and the Delaware Trustee) shall cause the Trust not to, engage in any
activity other than as required or authorized by this Declaration. The Trust
shall not:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders pursuant
to the terms of this Declaration and of the Securities;
(ii) acquire any assets other than as expressly pro-
vided herein;
(iii) possess Trust Property for other than a Trust
purpose or execute any mortgage in respect of, or pledge,
any Trust Property;
(iv) make any loans or incur any indebtedness other
than loans represented by the Debentures;
(v) possess any power or otherwise act in such a way
as to vary the Trust Property or the terms of the Securities
in any way whatsoever;
(vi) issue any securities or other evidences of bene-
ficial ownership of, or beneficial interest in, the Trust
other than the Securities;
(vii) other than as provided in this Declaration or Annex I
hereto, (A) direct the time, method and place of conducting any
proceeding with respect to any remedy available to the Debenture
Trustee, or exercising any trust or power conferred upon the Debenture
Trustee with respect to the Debentures, (B) waive any past default that
is waivable under the Indenture, or (C) exercise any right to rescind
or annul any declaration that the principal of all the Debentures shall
be due and payable; or
(viii) consent to any amendment, modification or termination
of the Indenture or the Debentures where such consent shall be required
unless the Trust shall have received an opinion of independent tax
counsel experienced in such matters to the effect that such amendment,
modification or termination will not cause more than an insubstantial
risk that the Trust will not be classified as a grantor trust for
United States federal income tax purposes.
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SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and
held of record in the name of the Property Trustee in trust for the benefit of
the Trust and the Holders. The right, title and interest of the Property Trustee
to the Debentures shall vest automatically in each Person who may hereafter be
appointed as Property Trustee in accordance with Section 5.6. Such vesting and
cessation of title shall be effective whether or not conveyancing documents with
regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title
and interest in the Debentures to the Administrative Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the Holders
and, upon the receipt of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit such funds into the
Property Trustee Account and make payments or cause the Paying Agent to
make payments to the Holders from the Property Trustee Account in
accordance with Section 6.1. Funds in the Property Trustee Account
shall be held uninvested until disbursed in accordance with this
Declaration. The Property Trustee Account shall be an account that is
maintained with a banking institution the rating on whose long-term
unsecured indebtedness by a "nationally recognized statistical rating
organization", as that term is defined for purposes of Rule 436(g)(2)
under the Securities Act, is at least equal to the rating assigned to
the Capital Securities;
(ii) engage in such ministerial activities as shall
be necessary or appropriate to effect the redemption of the
Securities to the extent the Debentures are redeemed or ma-
ture; and
(iii) upon written notice of distribution issued by the
Administrative Trustees in accordance with the terms of the Securities,
engage in such ministerial activities as shall be necessary or
appropriate to effect the distribution of the Debentures to Holders
upon the occurrence of certain events.
(d) The Property Trustee shall take all actions and perform
such duties as may be specifically required of the
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Property Trustee pursuant to the terms of this Declaration and the Securities.
(e) Subject to Section 3.9(a), the Property Trustee shall take
any Legal Action which arises out of or in connection with an Event of Default
of which a Responsible Officer has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act and if
the Property Trustee shall have failed to take such Legal Action, the Holders of
the Capital Securities may take such Legal Action, to the same extent as if such
Holders of Capital Securities held an aggregate principal amount of Debentures
equal to the aggregate liquidation amount of such Capital Securities, without
first proceeding against the Property Trustee or the Trust; provided however,
that if an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay the principal of or
premium, if any, or interest (including Compounded Interest and Additional Sums,
if any) or Liquidated Damages, if any, on the Debentures on the date such
principal, premium, if any, or interest (including Compounded Interest and
Additional Sums, if any) or Liquidated Damages, if any, is otherwise payable (or
in the case of redemption, on the redemption date), then a Holder of Capital
Securities may directly institute a proceeding for enforcement of payment to
such Holder of the principal of or premium, if any or interest (including
Compounded Interest and Additional Sums, if any) or Liquidated Damages, if any,
on the Debentures having a principal amount equal to the aggregate liquidation
amount of the Capital Securities of such Holder (a "Direct Action") on or after
the respective due date specified in the Debentures. In connection with such
Direct Action, the rights of the Holders of the Common Securities will be
subrogated to the rights of such Holder of Capital Securities to the extent of
any payment made by the Debenture Issuer to such Holder of Capital Securities in
such Direct Action. Except as provided in the preceding sentences, the Holders
of Capital Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
(f) The Property Trustee shall continue to serve as a Trustee
until either:
(i) the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders pur-
suant to the terms of the Securities; or
(ii) a successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6 (a "Successor
Property Trustee").
(g) The Property Trustee shall have the legal power
to exercise all of the rights, powers and privileges of a holder
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of Debentures under the Indenture and, if an Event of Default actually known to
a Responsible Officer occurs and is continuing, the Property Trustee shall, for
the benefit of Holders, enforce its rights as holder of the Debentures subject
to the rights of the Holders pursuant to the terms of this Declaration and the
Securities.
(h) The Property Trustee shall be authorized to
undertake any actions set forth in ss. 317(a) of the Trust Inden-
ture Act.
(i) For such time as the Property Trustee is the Paying Agent,
the Property Trustee may authorize one or more Persons to act as additional
Paying Agents and to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities and any such
Paying Agent shall comply with ss. 317(b) of the Trust Indenture Act. Any such
additional Paying Agent may be removed by the Property Trustee at any time the
Property Trustee remains as Paying Agent and a successor Paying Agent or
additional Paying Agents may be (but are not required to be) appointed at any
time by the Property Trustee while the Property Trustee is acting as Paying
Agent.
(j) Subject to this Section 3.8, the Property Trustee shall
have none of the duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 3.6.
Notwithstanding anything expressed or implied to the contrary
in this Declaration or any Annex or Exhibit hereto, (i) the Property Trustee
must exercise the powers set forth in this Section 3.8 in a manner that is
consistent with the purposes and functions of the Trust set out in Section 3.3,
and (ii) the Property Trustee shall not take any action that is inconsistent
with the purposes and functions of the Trust set out in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the Property
Trustee.
(a) The Property Trustee, before the occurrence of any Event
of Default and after the curing or waiving of all Events of Default that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and in the Securities and no implied covenants
shall be read into this Declaration against the Property Trustee. In case an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) of which a Responsible Officer has actual knowledge, the Property
Trustee shall exercise such of the rights and powers vested in it by this
Declaration, and use the same degree of care and skill in their exercise, as a
prudent
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person would exercise or use under the circumstances in the
conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to
relieve the Property Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of an Event of Default
and after the curing or waiving of all such Events of De-
fault that may have occurred:
(A) the duties and obligations of the Property
Trustee shall be determined solely by the express provisions
of this Declaration and in the Securities and the Property
Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Declaration and in the Securities, and no implied covenants or
obligations shall be read into this Declaration against the
Property Trustee; and
(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Declaration; provided, however, that in
the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to
the Property Trustee, the Property Trustee shall be under a
duty to examine the same to determine whether or not they
conform to the requirements of this Declaration;
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall
be proved that the Property Trustee was negligent in ascertaining the
pertinent facts;
(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a Majority in
liquidation amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred upon the
Property Trustee under this Declaration;
(iv) no provision of this Declaration shall require the
Property Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the perfor-
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mance of any of its duties or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to it
under the terms of this Declaration or indemnity reasonably
satisfactory to the Property Trustee against such risk or liability is
not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debentures and
the Property Trustee Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on
liability afforded to the Property Trustee under this Declaration and
the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for
or with respect to the value, genuineness, existence or sufficiency of
the Debentures or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any
interest on any money received by it except as it may otherwise agree
in writing with the Sponsor. Money held by the Property Trustee need
not be segregated from other funds held by it except in relation to the
Property Trustee Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law;
and
(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the Sponsor
with their respective duties under this Declaration, nor shall the
Property Trustee be liable for any default or misconduct of the
Administrative Trustees or the Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed, sent or presented by the
proper party or parties;
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(ii) any direction or act of the Sponsor or the Admi-
nistrative Trustees contemplated by this Declaration may be
sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the
Administrative Trustees;
(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or
securities laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel or other
experts of its selection and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of
such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or opinion, such counsel may be counsel to the Sponsor or any of
its Affiliates, and may include any of its employees, and the Property
Trustee shall have the right at any time to seek instructions
concerning the administration of this Declaration from any court of
competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration
at the request or direction of any Holder, unless such Holder shall
have provided to the Property Trustee security and indemnity,
reasonably satisfactory to the Property Trustee, against the costs,
expenses (including reasonable attorneys' fees and expenses and the
expenses of the Property Trustee's agents, nominees or custodians) and
liabilities that might be incurred by it in complying with such request
or direction, including such reasonable advances as may be requested by
the Property Trustee; provided, however, that, nothing contained in
this Section 3.10(a)(vi) shall be taken to relieve the Property
Trustee, upon the occurrence of an Event of Default, of its obligation
to exercise the rights and powers vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make
any investigation into the facts or matters stated in any
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resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the
Property Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders, and the signature of
the Property Trustee or its agents alone shall be sufficient and
effective to perform any such action and no third party shall be
required to inquire as to the authority of the Property Trustee to so
act or as to its compliance with any of the terms and provisions of
this Declaration, both of which shall be conclusively evidenced by the
Property Trustee's or its agent's taking such action;
(x) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request instructions from the
Holders which instructions may only be given by the Holders of the same
proportion in liquidation amount of the Securities as would be entitled
to direct the Property Trustee under the terms of the Securities in
respect of such remedy, right or action, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in conclusively
relying on or acting in or accordance with such instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any obligation to
take any action that is discretionary under the provisions of this
Declaration; and
(xii) the Property Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith, without
negligence or willful misconduct, and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Declaration.
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(b) No provision of this Declaration shall be deemed to impose
any duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.
SECTION 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other
than Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Trustees described in this Declaration (except as
required under the Business Trust Act). Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of ss. 3807 of the Business Trust Act. In the event
the Delaware Trustee shall at any time be required to take any action or perform
any duty hereunder, the Delaware Trustee shall be entitled to the benefits of
Section 3.9(b)(ii) to (viii), inclusive, and Section 3.10. No implied covenants
or obligations shall be read into this Declaration against the Delaware Trustee.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Administrative Trustees,
each Administrative Trustee, individually, is authorized to execute and deliver
on behalf of the Trust any documents, agreements, instruments or certificates
that the Administrative Trustees have the power and authority to execute
pursuant to Section 3.6.
SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities
shall be taken as the statements of the Sponsor, and the Trustees do not assume
any responsibility for their correctness. The Trustees make no representations
as to the value or condition of the Trust Property or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
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SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions of
Article VIII hereof, shall have existence up to May 1, 2028.
SECTION 3.15 Mergers.
(a) The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any Person, except as
described in Section 3.15(b) and (c) and except with respect to the distribution
of Debentures to Holders pursuant to Section 8.1(a)(iii).
(b) The Trust may, at the request of the Sponsor, with the
consent of the Administrative Trustees or, if there are more than two, a
majority of the Administrative Trustees and without the consent of the Holders,
the Delaware Trustee or the Property Trustee, merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to, a trust organized as
such under the laws of any State; provided that:
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations of
the Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the
"Successor Securities") so long as the Successor Securities
rank the same as the Securities rank in priority with respect
to Distributions and payments upon liquidation, redemption and
otherwise;
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Property
Trustee with respect to the Debentures;
(iii) the Successor Securities are listed, quoted or included
for trading, or any Successor Securities will be listed, quoted or
included for trading upon notification of issuance, on any national
securities exchange or with any other organization on which the Capital
Securities are then listed, quoted or included;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Capital Securities
(including any Successor Securities) or the Debentures to be downgraded
by any nationally recognized
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statistical rating organization that publishes a rating on
the Capital Securities or the Debentures;
(v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders (including the holders of any
Successor Securities) in any material respect (other than with respect
to any dilution of the interests of such Holders or holders, as the
case may be, in the new entity);
(vi) the Successor Entity has a purpose identical to
that of the Trust;
(vii) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
opinion of Brown & Wood LLP or another independent counsel to the Trust
experienced in such matters to the effect that:
(A) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders
(including the holders of any Successor Securities) in any
material respect (other than with respect to any dilution of
the interests of such Holders or holders, as the case may be,
in the new entity);
(B) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease,
neither the Trust nor the Successor Entity will be required to
register as an Investment Company; and
(C) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the
Trust (or the Successor Entity) will continue to be classified
as a grantor trust for United States federal income tax
purposes;
(viii) the Sponsor or any permitted successor or assignee owns
all of the common securities of the Successor Entity and guarantees the
obligations of the Successor Entity under the Successor Securities at
least to the extent provided by the Capital Securities Guarantee and
the Common Securities Guarantee; and
(ix) there shall have been furnished to the Property Trustee
an Officer's Certificate and an Opinion of Counsel, each to the effect
that all conditions precedent in this Declaration to such transaction
have been satisfied.
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(c) Notwithstanding Section 3.15(b), the Trust shall not,
except with the consent of Holders of 100% in liquidation amount of the
Securities, consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets as an entirety or
substantially as an entirety to, any other Person or permit any other Person to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or the Successor Entity not to be classified as a grantor
trust for United States federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
At the Closing Time, pursuant to the Common Securities
Subscription Agreement, the Sponsor will purchase all of the Common Securities
then issued by the Trust, in an amount equal to at least 3% of the total capital
of the Trust, at the same time as the Series A Capital Securities are issued and
sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital
Securities, the Sponsor shall have the exclusive right and responsibility to
engage in the following activities:
(a) to prepare the Offering Memorandum and to prepare for
filing by the Trust with the Commission any Registration Statement, including
any amendments thereto, as contemplated by the Registration Rights Agreement;
(b) to determine the States in which to take appropriate
action to qualify or register for sale all or part of the Capital Securities and
to do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for execution
and filing any documents to be executed and filed by the Trust, as the Sponsor
deems necessary or advisable in order to comply with the applicable laws of any
such States;
(c) if deemed necessary or advisable by the Sponsor, to
prepare for filing by the Trust an application to permit the Capital Securities
to trade or be quoted or listed in or on the PORTAL market, or any other
securities exchange, quotation system or the Nasdaq Stock Market's National
Market;
(d) to prepare for filing by the Trust with the Com-
mission a registration statement on Form 8-A, including any
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amendments thereto, relating to the registration of the Capital Securities under
Section 12(b) or 12(g) of the Exchange Act, as the case may be, including any
amendments thereto; and
(e) to negotiate the terms of the Purchase Agreement and the
Registration Rights Agreement providing for the sale and registration, as
applicable, of the Capital Securities.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of Capital
Securities, in the event that a failure of the Trust to pay Distributions on the
Capital Securities is attributable to the failure of the Company to pay the
principal of or premium (if any) or interest on the Debentures, to institute a
proceeding directly against the Debenture Issuer for enforcement of its payment
obligations on the Debentures.
SECTION 4.4 Right to Terminate Trust.
The Sponsor will have the right at any time to terminate the
Trust and, after satisfaction of liabilities to creditors of the Trust as
required by applicable law, to cause the Debentures to be distributed to the
Holders in liquidation of the Trust. Such right is subject to the Sponsor's
having received (i) an Opinion of Counsel to the effect that such distribution
will not cause the holders of Capital Securities to recognize gain or loss for
United States federal income tax purposes and (ii) any required regulatory
approvals.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securi-
ties, the Sponsor may, by written instrument, increase or de-
crease the number of Trustees; and
(b) after the issuance of any Securities, the number of
Trustees may be increased or decreased by vote of the Holders of a Majority in
liquidation amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities;
provided, however, that, the number of Trustees shall in no event be less than
two (2); provided further that (1) one Trustee, in the case of a natural person,
shall be a person who is a resident
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of the State of Delaware or that, if not a natural person, is an entity which
has its principal place of business in the State of Delaware (the "Delaware
Trustee"); (2) there shall be at least one Trustee who is an employee or officer
of, or is affiliated with, the Sponsor (an "Administrative Trustee"); and (3)
one Trustee shall be the Property Trustee for so long as this Declaration is
required to qualify as an indenture under the Trust Indenture Act, and such
Trustee may also serve as Delaware Trustee if it meets the applicable
requirements. Notwithstanding the above, unless an Event of Default shall have
occurred and be continuing, at any time or times, for the purpose of meeting the
legal requirements of the Trust Indenture Act or of any jurisdiction in which
any part of the Trust Property may at the time be located, the Holders of a
Majority in liquidation amount of the Common Securities acting as a class at a
meeting of the Holders of the Common Securities, and the Administrative Trustees
shall have power to appoint one or more Persons either to act as a co-trustee,
jointly with the Property Trustee, of all or any part of the Trust Property, or
to act as separate trustee of any such property, in either case with such powers
as may be provided in the instrument of appointment, and to vest in such Person
or Persons in such capacity any property, title, right or power deemed necessary
or desirable, subject to the provisions of this Declaration. In case an Event of
Default has occurred and is continuing, the Property Trustee alone shall have
power to make any such appointment of a co-trustee.
SECTION 5.2 Delaware Trustee.
For so long as required by the Business Trust Act, the
Delaware Trustee shall be:
(a) a natural person who is a resident of the State
of Delaware; or
(b) if not a natural person, an entity which has its
principal place of business in the State of Delaware, and other-
wise meets the requirements of applicable law,
provided, however, that, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable law, then the Property Trustee shall also be the Delaware Trustee and
Section 3.11 shall have no application.
The initial Delaware Trustee shall be:
First Chicago Delaware Inc.
300 King Street
Wilmington, Delaware, 19801
Attention: Michael J. Majchrzak
Telecopy: (302)651-8882
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Telephone: (302)651-1000
SECTION 5.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee (the "Property
Trustee") which shall act as Property Trustee and which shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof
or of the District of Columbia, or a corporation or Person permitted by
the Commission to act as an indenture trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million U.S.
dollars ($50,000,000), and subject to supervision or examination by
federal, state, territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section 5.3(a)(ii),
the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent
report of condition so published.
(b) If at any time the Property Trustee shall cease to be
eligible to so act under Section 5.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 5.6(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of ss. 310(b) of the Trust Indenture
Act, the Property Trustee and the Holder of the Common Securities (as if it were
the obligor referred to in ss. 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of ss. 310(b) of the Trust Indenture Act.
(d) The Capital Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first proviso contained in ss.310(b) of the Trust Indenture Act.
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(e) The initial Property Trustee shall be:
The First National Bank of Chicago
One First National Plaza Mall, Suite 0126
Chicago, IL 60670-0126
Telecopier: (212) 373-1383
Telephone: (212) 373-1191
Attention: Corporate Trust Administration
SECTION 5.4 Certain Qualifications of Administrative
Trustees and Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee (unless
the Property Trustee also acts as Delaware Trustee) shall be either a natural
person who is at least 21 years of age or a legal entity that shall act through
one or more Authorized Officers.
SECTION 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
Thomas J. Pruitt
Neal E. Robinson
James D. Adams
c/o Banknorth Group, Inc.
300 Financial Plaza
P.O. Box 05401
Burlington, Vermont 05401
Telecopier: (802) 658-5437
Telephone: (802) 860-2492
(a) Except as expressly set forth in this Declaration and
except if a meeting of the Administrative Trustees is called with respect to any
matter over which the Administrative Trustees have power to act, any power of
the Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee.
(b) Unless otherwise determined by the Administrative
Trustees, and except as otherwise required by the Business Trust Act or
applicable law, any Administrative Trustee is authorized to execute on behalf of
the Trust any documents which the Administrative Trustees have the power and
authority to cause the Trust to execute pursuant to Section 3.6.
(c) An Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purposes of signing any documents which the
Administrative
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Trustees have power and authority to cause the Trust to execute pursuant to
Section 3.6.
SECTION 5.6 Appointment, Removal and Resignation of
Trustees.
(a) Subject to Section 5.6(b) hereof and to Section 6(b) of
Annex I hereto, Trustees may be appointed or removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, by vote of the Holders
of a Majority in liquidation amount of the Common Securities voting as
a class at a meeting of the Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred and be
continuing after the issuance of the Securities, with respect to the
Property Trustee or the Delaware Trustee, by vote of Holders of a
Majority in liquidation amount of the Capital Securities voting as a
class at a meeting of Holders of the Capital Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.6(a) until a Successor Property Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Property Trustee and delivered to the removed Property
Trustee, the Administrative Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with this Section 5.6(a) until a successor
Trustee possessing the qualifications to act as Delaware Trustee under
Sections 5.2 and 5.4 (a "Successor Delaware Trustee") has been
appointed and has accepted such appointment by written instrument
executed by such Successor Delaware Trustee and delivered to the
removed Delaware Trustee, the Administrative Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing signed by the Trustee and delivered to
the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided, however,
that:
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(i) No such resignation of the Trustee that acts as
the Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Property Trustee and delivered to
the Trust, the Sponsor and the resigning Property Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distrib-
uted to the Holders; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Dela- ware Trustee and delivered to the
Trust, the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities or, if an Event of
Default shall have occurred and be continuing after the issuance of the
Securities, the Holders of the Capital Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 5.6.
(e) If no Successor Property Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 5.6 within 60 days after delivery of an instrument of resignation or
removal, the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper and
prescribe, appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable
for the acts or omissions to act of any Successor Property Trustee or Successor
Delaware Trustee, as the case may be.
(g) At the time of resignation or removal of the Property
Trustee or the Delaware Trustee, the Debenture Issuer shall pay to such Trustee
any amounts that may be owed to such
Trustee pursuant to Section 10.4.
SECTION 5.7 Vacancies among Trustees.
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If a Trustee ceases to hold office for any reason and the
number of Trustees is not reduced pursuant to Section 5.1, or if the number of
Trustees is increased pursuant to Section 5.1, a vacancy shall occur. A
resolution certifying the existence of such vacancy by the Administrative
Trustees or, if there are more than two, a majority of the Administrative
Trustees shall be conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance with Section 5.6.
SECTION 5.8 Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy,
dissolution, liquidation, incompetence or incapacity to perform the duties of a
Trustee shall not operate to dissolve, terminate or annul the Trust. Whenever a
vacancy in the number of Administrative Trustees shall occur, until such vacancy
is filled by the appointment of an Administrative Trustee in accordance with
Section 5.6, the Administrative Trustees in office, regardless of their number,
shall have all the powers granted to the Administrative Trustees and shall
discharge all the duties imposed upon the Administrative Trustees by this
Declaration.
SECTION 5.9 Meetings.
If there is more than one Administrative Trustee, meetings of
the Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 24 hours before such meeting. Notice of
any telephonic meetings of the Administrative Trustees or any committee thereof
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of an Administrative Trustee at a meeting shall constitute a waiver
of notice of such meeting except where an Administrative Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
provided otherwise in this Declaration, any action of the Administrative
Trustees may be taken at a meeting by vote of a majority of the Administrative
Trustees present (whether in person or by telephone) and eligible to vote with
respect to such matter, provided that a Quorum is present, or without a meeting
by the unanimous written consent of the Administrative Trustees. In the event
there is only one Administrative Trustee, any and all action of such
Administrative
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Trustee shall be evidenced by a written consent of such Administrative Trustee.
SECTION 5.10 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney
consistent with applicable law, delegate to any other natural person over the
age of 21 his or her power for the purpose of executing any documents
contemplated in Section 3.6, including any registration statement or amendment
thereto filed with the Commission, or making any other governmental filing.
(b) The Administrative Trustees shall have power to delegate
from time to time to such of their number or to officers of the Trust the doing
of such things and the execution of such instruments either in the name of the
Trust or the names of the Administrative Trustees or otherwise as the
Administrative Trustees may deem expedient, to the extent such delegation is not
prohibited by applicable law or contrary to the provisions of the Trust, as set
forth herein.
SECTION 5.11 Merger, Conversion, Consolidation or Succession
to Business.
Any Person into which the Property Trustee or the Delaware Trustee or
any Administrative Trustee that is not a natural person, as the case may be, may
be merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which the Property
Trustee or the Delaware Trustee, as the case may be, shall be a party, or any
Person succeeding to all or substantially all the corporate trust business of
the Property Trustee or the Delaware Trustee, as the case may be, shall be the
successor of the Property Trustee or the Delaware Trustee, as the case may be,
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, provided such Person shall be otherwise
qualified and eligible under this Article.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with the
applicable terms of the relevant Holder's Securities. If and to the extent that
the Debenture Issuer makes a payment of interest (including Compounded Interest
and Additional Sums), premium and/or principal on the Debentures held by the
Property Trustee or Liquidated Damages or any other payments pursuant to the
Registration Rights Agreement with respect to the Debentures held by the
Property Trustee (the amount of any such payment
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being a "Payment Amount"), the Property Trustee shall and is directed, to the
extent funds are available for that purpose, to make a distribution (a
"Distribution") of the Payment Amount to Holders in accordance with the terms
thereof.
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrative Trustees shall on behalf of the Trust
issue one class of capital securities representing undivided preferred
beneficial interests in the assets of the Trust having such terms as are set
forth in Annex I (the "Series A Capital Securities") and one class of common
securities representing common undivided beneficial interests in the assets of
the Trust having such terms as are set forth in Annex I (the "Common
Securities"). The Administrative Trustees shall on behalf of the Trust issue one
class of capital securities representing undivided preferred beneficial
interests in the Trust having such terms as set forth in Annex I (the "Series B
Capital Securities") in exchange for the Series A Capital Securities accepted
for exchange in the Exchange Offer, which Series B Capital Securities shall not
bear the legends required by Section 9.2(i) unless the Holder of such Series A
Capital Securities is either (A) a broker-dealer who purchased such Series A
Capital Securities directly from the Trust for resale pursuant to Rule 144A or
any other available exemption under the Securities Act, (B) a Person
participating in the distribution of the Series A Capital Securities or (C) a
Person who is an Affiliate of the Sponsor or the Trust. The Trust shall issue no
securities or other interests in the assets of the Trust other than the Capital
Securities and the Common Securities.
(b) The consideration received by the Trust for the issuance
of the Securities shall constitute a contribution to the capital of the Trust
and shall not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this
Declaration, the Securities so issued shall be deemed to be validly issued,
fully paid and non-assessable.
(d) Every Person, by virtue of having become a Holder or a
Capital Security Beneficial Owner in accordance with the terms of this
Declaration, shall be deemed to have expressly assented and agreed to the terms
of, and shall be bound by, this Declaration.
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SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the Trust by
an Administrative Trustee. In case any Administrative Trustee of the Trust who
shall have signed any of the Securities shall cease to be such Administrative
Trustee before the Securities so signed shall be delivered by the Trust, such
Securities nevertheless may be delivered as though the Person who signed such
Securities had not ceased to be such Administrative Trustee; and any Securities
may be signed on behalf of the Trust by such persons who, at the actual date of
execution of such Security, shall be the Administrative Trustees of the Trust,
although at the date of the execution and delivery of this Declaration any such
person was not an Administrative Trustee.
(b) One Administrative Trustee shall sign the Securities for
the Trust by manual or facsimile signature. Unless otherwise determined by the
Trust, such signature shall, in the case of Common Securities, be a manual
signature.
A Capital Security shall not be valid until authenticated by
the manual signature of an authorized signatory of the Property Trustee. The
signature shall be conclusive evidence that the Capital Security has been
authenticated under this Declaration. A Common Security shall be valid upon
execution by an Administrative Trustee without any act of the Property Trustee.
Upon a written order of the Trust signed by one Administrative
Trustee, the Property Trustee shall authenticate the Capital Securities for
original issue. The aggregate number of Capital Securities outstanding at any
time shall not exceed the number set forth in Annex I hereto except as provided
in Section 7.6.
The Property Trustee may appoint an authenticating agent
acceptable to the Trust to authenticate Capital Securities. An authenticating
agent may authenticate Capital Securities whenever the Property Trustee may do
so. Each reference in this Declaration to authentication by the Property Trustee
includes authentication by such agent. An authenticating agent has the same
rights as the Property Trustee hereunder with respect to the Sponsor or an
Affiliate.
SECTION 7.3 Form and Dating.
The Capital Securities and the Property Trustee's certificate
of authentication shall be substantially in the form of Exhibit A-1 and the
Common Securities shall be substantially in the form of Exhibit A-2. The
Property Trustee's certificate of authentication shall be substantially in the
form set forth in Exhibit A-1. Certificates representing the Securities may be
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printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to an Administrative Trustee, as evidenced by the
execution thereof. The Securities may have letters, "CUSIP" or other numbers,
notations or other marks of identification or designation and such legends or
endorsements required by law, stock exchange rule, agreements to which the Trust
is subject, if any, or usage, provided that any such notation, legend or
endorsement is in a form acceptable to the Administrative Trustees, as evidenced
by their execution thereof. The Trust at the direction of the Sponsor shall
furnish any such legend not contained in Exhibit A-1 to the Property Trustee in
writing. Each Capital Security shall be dated the date of its authentication.
The terms and provisions of the Securities set forth in Annex I and the forms of
Securities set forth in Exhibits A-1 and A-2 are part of the terms of this
Declaration and to the extent applicable, the Property Trustee and the Sponsor,
by their execution and delivery of this Declaration, expressly agree to such
terms and provisions and to be bound thereby.
(a) Global Capital Security. Capital Securities offered and
sold to QIBs in reliance on Rule 144A, as provided in the Purchase Agreement,
shall be issued in the form of a single permanent global Capital Security in
definitive, fully registered form without distribution coupons with the
appropriate global legends and Restricted Securities Legend set forth in Exhibit
A-1 hereto (the "Global Capital Security"), which shall be deposited on behalf
of the purchasers of the Capital Securities represented thereby with the
Property Trustee, at its New York, New York office, as custodian for the
Clearing Agency, and registered in the name of the Clearing Agency or a nominee
of the Clearing Agency, duly executed by the Trust and authenticated by the
Property Trustee as hereinafter provided. The number of Capital Securities
represented by the Global Capital Security may from time to time be increased or
decreased by adjustments made on the records of the Property Trustee and the
Clearing Agency or its nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 7.3(b) shall apply
only to the Global Capital Security and such other Capital Securities in global
form as may be authorized by the Trust to be deposited with or on behalf of the
Clearing Agency.
An Administrative Trustee shall execute and the Property
Trustee shall, in accordance with this Section 7.3, authenticate and make
available for delivery initially a single Global Capital Security that (i) shall
be registered in the name of Cede & Co. or other nominee of such Clearing Agency
and (ii) shall be delivered by the Property Trustee to such Clearing Agency or
pursuant to such Clearing Agency's written instructions or held by the Property
Trustee as custodian for the Clearing Agency.
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Members of, or participants in, the Clearing Agency
("Participants") shall have no rights under this Declaration with respect to the
Global Capital Security held on their behalf by the Clearing Agency or by the
Property Trustee as the custodian of the Clearing Agency or under such Global
Capital Security, and the Clearing Agency may be treated by the Trust, the
Property Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Capital Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Trust, the
Property Trustee or any agent of the Trust or the Property Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Clearing Agency or impair, as between the Clearing Agency and its
Participants, the operation of customary practices of such Clearing Agency
governing the exercise of the rights of a holder of a beneficial interest in the
Global Capital Security.
(c) Definitive Capital Securities. Except as provided in
Section 7.9 or 9.2(f)(i), owners of beneficial interests in the Global Capital
Security will not be entitled to receive physical delivery of certificated
Capital Securities ("Definitive Capital Securities"). Purchasers of Securities
who are "accredited investors" (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) and who are not QIBs will receive Capital Securities
in the form of individual certificates in definitive, fully registered form
without distribution coupons and with the Restricted Securities Legend set forth
in Exhibit A- 1 hereto ("Restricted Definitive Capital Securities"); provided,
however, that upon registration of transfer of such Restricted Definitive
Capital Securities to a QIB, such Restricted Definitive Capital Securities will,
unless the Global Capital Security has previously been exchanged, be exchanged
for an interest in the Global Capital Security pursuant to the provisions of
Section 9.2. Restricted Definitive Capital Securities will bear the Restricted
Securities Legend set forth on Exhibit A-1 unless removed in accordance with
this Section 7.3 or Section 9.2.
SECTION 7.4 Registrar, Paying Agent and Exchange Agent.
The Trust shall maintain in New York, New York (i) an office
or agency where Capital Securities may be presented for registration of transfer
("Registrar"), (ii) an office or agency where Capital Securities may be
presented for payment ("Paying Agent") and (iii) an office or agency where
Securities may be presented for exchange ("Exchange Agent"). The Registrar shall
keep a register of the Capital Securities and of their transfer. The Trust may
appoint the Registrar, the Paying Agent and the Exchange Agent and may appoint
one or more co-registrars, one or more additional paying agents and one or more
additional exchange agents in such other locations as it shall determine. The
term "Registrar" includes any additional registrar, the term "Paying
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Agent" includes any additional paying agent and the term "Exchange Agent"
includes any additional exchange agent. The Trust may change any Paying Agent,
Registrar, co-registrar or Exchange Agent without prior notice to any Holder.
The Paying Agent shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Administrative Trustees. The Trust shall notify the
Property Trustee of the name and address of any Agent not a party to this
Declaration. If the Trust fails to appoint or maintain another entity as
Registrar, Paying Agent or Exchange Agent, the Property Trustee shall act as
such. The Trust or any of its Affiliates may act as Paying Agent, Registrar, or
Exchange Agent. The Trust shall act as Paying Agent, Registrar and Exchange
Agent for the Common Securities.
The Trust initially appoints the Property Trustee as
Registrar, Paying Agent and Exchange Agent for the Capital Securities.
SECTION 7.5 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than the
Property Trustee to agree in writing that the Paying Agent will hold in trust
for the benefit of Holders or the Property Trustee all money held by the Paying
Agent for the payment of liquidation amounts or Distributions, and will notify
the Property Trustee if there are insufficient funds for such purpose. While any
such insufficiency continues, the Property Trustee may require a Paying Agent to
pay all money held by it to the Property Trustee. The Trust at any time may
require a Paying Agent to pay all money held by it to the Property Trustee and
to account for any money disbursed by it. Upon payment over to the Property
Trustee, the Paying Agent (if other than the Trust or an Affiliate of the Trust)
shall have no further liability for the money. If the Trust or the Sponsor or an
Affiliate of the Trust or the Sponsor acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all money held
by it as Paying Agent.
SECTION 7.6 Replacement Securities.
If a Holder claims that a Security owned by it has been lost,
destroyed or wrongfully taken or if such Security is mutilated and is
surrendered to the Trust or in the case of the Capital Securities to the
Property Trustee, an Administrative Trustee shall execute and the Property
Trustee shall authenticate and make available for delivery a replacement
Security if the Property Trustee's requirements are met. An indemnity bond must
be provided by the Holder which, in the judgment of the Property Trustee, is
sufficient to protect the Trustees, the Sponsor, the Trust or any authenticating
agent from any loss which any of them may suffer if a Security is replaced. The
Trust may charge such Holder for its expenses in replacing a Security.
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SECTION 7.7 Outstanding Capital Securities.
The Capital Securities outstanding at any time are all the
Capital Securities authenticated by the Property Trustee except for those
cancelled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
If a Capital Security is replaced, paid or purchased pursuant
to Section 7.6 hereof, it ceases to be outstanding unless the Property Trustee
receives proof satisfactory to it that the replaced, paid or purchased Capital
Security is held by a bona fide purchaser.
If Capital Securities are considered paid in accordance with
the terms of this Declaration, they cease to be outstanding and Distributions on
them shall cease to accumulate.
A Capital Security does not cease to be outstanding because
one of the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 7.8 Capital Securities in Treasury.
In determining whether the Holders of the required amount of
Securities have concurred in any direction, waiver or consent, Capital
Securities owned by the Trust, the Sponsor or an Affiliate of the Sponsor, as
the case may be, shall be disregarded and deemed not to be outstanding, except
that for the purposes of determining whether the Property Trustee shall be fully
protected in relying on any such direction, waiver or consent, only Securities
which the Property Trustee actually knows are so owned shall be so disregarded.
SECTION 7.9 Temporary Securities.
(a) Until Definitive Securities are ready for delivery, the
Trust may prepare and, in the case of the Capital Securities, the Property
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of Definitive Securities but may have variations that
the Trust considers appropriate for temporary Securities. Without unreasonable
delay, the Trust shall prepare and, in the case of the Capital Securities, the
Property Trustee shall authenticate Definitive Securities in exchange for
temporary Securities.
(b) The Global Capital Security deposited with the Clearing
Agency or with the Property Trustee as custodian for the Clearing Agency
pursuant to Section 7.3 shall be transferred to the beneficial owners thereof in
the form of Definitive Capital Securities only if such transfer complies with
Section 9.2 and (i) the Clearing Agency notifies the Sponsor that it is
unwilling
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or unable to continue as Clearing Agency for such Global Capital Security or if
at any time such Clearing Agency ceases to be a "clearing agency" registered
under the Exchange Act, and, in each case, a clearing agency is not appointed by
the Sponsor within 90 days of receipt of such notice or of becoming aware of
such condition, (ii) a Default or an Event of Default has occurred and is
continuing or (iii) the Trust at its sole discretion elects to cause the
issuance of Definitive Capital Securities.
(c) Any Global Capital Security that is transferable to the
beneficial owners thereof in the form of Definitive Capital Securities pursuant
to this Section 7.9 shall be surrendered by the Clearing Agency to the Property
Trustee located in New York, New York, to be so transferred, in whole or from
time to time in part, without charge, and the Property Trustee shall
authenticate and make available for delivery, upon such transfer of each portion
of such Global Capital Security, an equal aggregate liquidation amount of
Securities of authorized denominations in the form of Definitive Capital
Securities. Any portion of the Global Capital Security transferred pursuant to
this Section shall be registered in such names as the Clearing Agency shall
direct. Any Definitive Capital Security delivered in exchange for an interest in
the Restricted Global Capital Security shall, except as otherwise provided by
Sections 7.3 and 9.1, bear the Restricted Securities Legend set forth in Exhibit
A-1 hereto.
(d) Subject to the provisions of Section 7.9(c), the Holder of
the Global Capital Security may grant proxies and otherwise authorize any
Person, including Participants and Persons that may hold interests through
Participants, to take any action which such Holder is entitled to take under
this Declaration or the Securities.
(e) In the event of the occurrence of any of the events
specified in Section 7.9(b), the Trust will promptly make available to the
Property Trustee a reasonable supply of certificated Capital Securities in fully
registered form without distribution coupons.
SECTION 7.10 Cancellation.
The Trust at any time may deliver Capital Securities to the
Property Trustee for cancellation. The Registrar, Paying Agent and Exchange
Agent shall forward to the Property Trustee any Capital Securities surrendered
to them for registration of transfer, redemption, exchange or payment. The
Property Trustee shall promptly cancel all Capital Securities, surrendered for
registration of transfer, redemption, exchange, payment, replacement or
cancellation and shall dispose of cancelled Capital Securities in accordance
with its customary procedures unless the Trust otherwise directs. The Trust may
not issue new Capital Securities to replace Capital Securities that it has paid
or that
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have been delivered to the Property Trustee for cancellation or
that any Holder has exchanged.
SECTION 7.11 CUSIP Numbers.
The Trust in issuing the Capital Securities may use "CUSIP"
numbers (if then generally in use), and, if so, the Property Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Holders of Capital
Securities; provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on the Capital
Securities or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Capital
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Sponsor will promptly notify the Property Trustee
of any change in the CUSIP numbers.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall dissolve and be of no further force or
effect:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution or
liquidation or its equivalent with respect to the Sponsor; or the
revocation of the Sponsor's charter and the expiration of 90 days after
the date of revocation without a reinstatement thereof;
(iii) following the distribution of a Like Amount of the
Debentures to the Holders, provided that, the Property Trustee has
received written notice from the Sponsor directing the Property Trustee
to terminate the Trust (which direction is optional, and except as
otherwise expressly provided below, within the discretion of the
Sponsor) and provided, further, that such direction and such
distribution is conditioned on (a) the receipt by the Sponsor of any
required regulatory approvals, and (b) the Administrative Trustees'
receipt of an opinion of Brown & Wood LLP, or another independent tax
counsel experienced in such matters, which opinion may rely on public
or private rulings of the Internal Revenue Service, to the effect that
the Holders of the Capital Securities will not recognize any gain or
loss for United States federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures;
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(iv) upon the entry of a decree of judicial dissolu-
tion of the Trust by a court of competent jurisdiction;
(v) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the
Securities;
(vi) upon the redemption or repayment of the Deben-
tures or at such time as no Debentures are outstanding; or
(vii) the expiration of the term of the Trust provided
in Section 3.14.
(b) As soon as is practicable upon completion of winding up of
the Trust following the occurrence of an event referred to in Section 8.1(a),
the Administrative Trustees shall file a certificate of cancellation with the
Secretary of State of the State of Delaware in accordance with the Business
Trust Act.
(c) The provisions of Section 3.9 and Article X
shall survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or in part,
in accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void.
(b) Subject to this Article IX, Capital Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Declaration. Any transfer or purported transfer of any
Security not made in accordance with this Declaration shall be null and void.
(c) For so long as the Securities remain outstanding, the
Sponsor agrees (i) not to transfer ownership of the Common Securities of the
Trust, provided that any permitted successor of the Sponsor under the Indenture
may succeed to the Sponsor's ownership of the Common Securities, (ii) not to
cause, as Sponsor of the Trust, or to permit, as Holder of the Common
Securities, the dissolution, winding-up or termination of the Trust, except as
provided in this Declaration and (iii) to use its commercially reasonable
efforts to cause the Trust (a) to remain a business trust, except in connection
with the distribution of Debentures to the Holders in liquidation of the Trust,
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the redemption of all of the Securities, or certain mergers, consolidations or
amalgamations, each as permitted by this Declaration, and (b) to otherwise
continue to be classified as a grantor trust for United States federal income
tax purposes.
(d) The Property Trustee shall provide for the registration of
Capital Securities and of the transfer of Capital Securities, which will be
effected without charge but only upon payment (with such indemnity as the
Property Trustee may require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon surrender for registration
of transfer of any Capital Securities, an Administrative Trustee shall cause one
or more new Capital Securities to be issued in the name of the designated
transferee or transferees. Every Capital Security surrendered for registration
of transfer shall be accompanied by a written instrument of transfer in form
satisfactory to the Property Trustee duly executed by the Holder or such
Holder's attorney duly authorized in writing. Each Capital Security surrendered
for registration of transfer shall be delivered to the Property Trustee and
canceled in accordance with Section 7.10. A transferee of a Capital Security
shall be entitled to the rights and subject to the obligations of a Holder
hereunder upon the receipt by such transferee of a Capital Security. By
acceptance of a Capital Security or any interest therein, each transferee shall
be deemed to have agreed to be bound by this Declaration.
SECTION 9.2 Transfer Procedures and Restrictions
(a) General. Except as otherwise provided in Section 9.2(b),
if Capital Securities are issued upon the transfer, exchange or replacement of
Capital Securities bearing the Restricted Securities Legend set forth in Exhibit
A-1 hereto, or if a request is made to remove such Restricted Securities Legend
on Capital Securities, the Capital Securities so issued shall bear the
Restricted Securities Legend, or the Restricted Securities Legend shall not be
removed, as the case may be, unless there is delivered to the Trust and the
Property Trustee such satisfactory evidence, which shall include an Opinion of
Counsel, as may be reasonably required by the Trust and the Property Trustee,
that neither the Restricted Securities Legend nor the restrictions on transfer
set forth therein are required to ensure that transfers thereof are made
pursuant to an exception from the registration requirements of the Securities
Act or, with respect to Restricted Securities, that such Securities are not
"restricted" within the meaning of Rule 144. Upon provision of such satisfactory
evidence, the Property Trustee, at the written direction of the Trust, shall
authenticate and deliver Capital Securities that do not bear the legend.
(b) Transfers After Effectiveness of a Registration
Statement. After the effectiveness of a Registration Statement
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with respect to any Capital Securities, all requirements pertaining to legends
on such Capital Securities will cease to apply (other than the legend requiring
that transfers of Capital Securities be made in blocks having an aggregate
liquidation amount of not less than $100,000), and beneficial interests in the
Global Capital Security without legends will be available to transferees of such
Capital Securities, upon exchange of the transferring Holder's Restricted
Definitive Capital Security or directions to transfer such Holder's beneficial
interest in the Global Capital Security, as the case may be. No such transfer or
exchange of a Restricted Definitive Capital Security or of an interest in the
Global Capital Security shall be effective unless the transferor delivers to the
Property Trustee a certificate in a form substantially similar to that attached
hereto as the form of "Assignment" in Exhibit A-1. Except as otherwise provided
in Section 9.2(m), after the effectiveness of a Registration Statement, the
Trust shall issue and the Property Trustee, upon a written order of the Trust
signed by one Administrative Trustee, shall authenticate a Global Capital
Security without the Restricted Securities Legend (the "Unrestricted Global
Capital Security") to deposit with the Clearing Agency to evidence transfers of
beneficial interests from the (i) Global Capital Security and (ii) Restricted
Definitive Capital Securities.
(c) Transfer and Exchange of Definitive Capital Securities.
When Definitive Capital Securities are presented to the Registrar or
co-registrar:
(x) to register the transfer of such Definitive Capital
Securities; or
(y) to exchange such Definitive Capital Securities which
became mutilated, destroyed, defaced, stolen or lost, for an equal
number of Definitive Capital Securities,
the Registrar or co-registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Capital Securities surrendered for
registration of transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Trust and
the Registrar or co-registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing; and
(ii) in the case of Definitive Capital Securities
that are Restricted Definitive Capital Securities:
(A) if such Restricted Capital Securities are
being delivered to the Registrar by a Holder for regis-
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tration in the name of such Holder, without transfer,
certification(s) from such Holder to that effect; or
(B) if such Restricted Capital Securities are being
transferred: (i) certification(s) in a form substantially
similar to that attached hereto as the form of "Assignment" in
Exhibit A-1, and (ii) if the Trust or Registrar so requests,
evidence reasonably satisfactory to them as to the compliance
with the restrictions set forth in the Restricted Securities
Legend.
(d) Restrictions on Transfer of a Definitive Capital Security
for a Beneficial Interest in the Global Capital Security. A Definitive Capital
Security may not be exchanged for a beneficial interest in the Global Capital
Security except upon satisfaction of the requirements set forth below. Upon
receipt by the Property Trustee of a Definitive Capital Security, duly endorsed
or accompanied by appropriate instruments of transfer, in form satisfactory to
the Property Trustee, together with:
(i) if such Definitive Capital Security is a Restricted
Capital Security, certification(s) in a form substantially similar to
that attached hereto as the form of "Assignment" in Exhibit A-1; and
(ii) whether or not such Definitive Capital Security is a
Restricted Capital Security, written instructions directing the
Property Trustee to make, or to direct the Clearing Agency to make, an
adjustment on its books and records with respect to the Global Capital
Security to reflect an increase in the number of the Capital Securities
represented by such Global Capital Security,
then the Property Trustee shall cancel such Definitive Capital Security and
cause, or direct the Clearing Agency to cause, the aggregate number of Capital
Securities represented by the Global Capital Security to be increased
accordingly. If the Global Capital Security is not then outstanding, the Trust
shall issue and the Property Trustee shall authenticate, upon written order of
any Administrative Trustee, a new Global Capital Security representing an
appropriate number of Capital Securities.
(e) Transfer and Exchange of the Global Capital Security.
Subject to Section 9.2(f), the transfer and exchange of Global Capital Security
or beneficial interests therein shall be effected through the Clearing Agency in
accordance with this Declaration (including applicable restrictions on transfer
set forth herein, if any) and the procedures of the Clearing Agency therefor.
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(f) Transfer of a Beneficial Interest in the Global
Capital Security for a Definitive Capital Security.
(i) Any Person having a beneficial interest in the Global
Capital Security may upon request, but only upon 20 days prior notice
to the Property Trustee, and if accompanied by the information
specified below, exchange such beneficial interest for a Definitive
Capital Security representing the same number of Capital Securities.
Upon receipt by the Property Trustee from the Clearing Agency or its
nominee on behalf of any Person having a beneficial interest in the
Global Capital Security of written instructions or such other form of
instructions as is customary for the Clearing Agency or the Person
designated by the Clearing Agency as having such a beneficial interest
in a Restricted Capital Security and certification(s) from the
transferor in a form substantially similar to that attached hereto as
the form of "Assignment" in Exhibit A-1, which may be submitted by
facsimile, then the Property Trustee will cause the aggregate number of
Capital Securities represented by the Global Capital Security to be
reduced on its books and records and, following such reduction, the
Trust will execute and the Property Trustee will authenticate and make
available for delivery to the transferee a Definitive Capital Security.
(ii) Definitive Capital Securities issued in exchange for a
beneficial interest in the Global Capital Security pursuant to this
Section 9.2(f) shall be registered in such names and in such authorized
denominations as the Clearing Agency, pursuant to instructions from its
Clearing Agency Participants or indirect participants or otherwise,
shall instruct the Property Trustee in writing. The Property Trustee
shall deliver such Capital Securities to the Persons in whose names
such Capital Securities are so registered in accordance with such
instructions of the Clearing Agency.
(g) Restrictions on Transfer and Exchange of the Global
Capital Security. Notwithstanding any other provisions of this Declaration
(other than the provisions set forth in subsection (h) of this Section 9.2), the
Global Capital Security may not be transferred as a whole except by the Clearing
Agency to a nominee of the Clearing Agency or another nominee of the Clearing
Agency or by the Clearing Agency or any such nominee to a successor Clearing
Agency or a nominee of such successor Clearing Agency.
(h) Authentication of Definitive Capital Securities.
If at any time:
(i) a Default or an Event of Default has occurred
and is continuing,
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(ii) the Trust, in its sole discretion, notifies the Property
Trustee in writing that it elects to cause the issuance of Definitive
Capital Securities under this Declaration, or
(iii) the Clearing Agency notifies the Sponsor that it is
unwilling or unable to continue as Clearing Agency for such Global
Capital Security or if at any time such Clearing Agency ceases to be a
"clearing agency" registered under the Exchange Act, and, in each case,
a clearing agency is not appointed by the Sponsor within 90 days of
receipt of such notice or of becoming aware of such condition,
then the Trust will execute, and the Property Trustee, upon receipt of a written
order of the Trust signed by one Administrative Trustee requesting the
authentication and delivery of Definitive Capital Securities to the Persons
designated by the Trust, will authenticate and make available for delivery
Definitive Capital Securities, equal in number to the number of Capital
Securities represented by the Global Capital Security, in exchange for such
Global Capital Security.
(i) Legend.
(i) Except as permitted by the following paragraph (ii), each
Capital Security Certificate evidencing the Global Capital Security or
the Definitive Capital Securities (and all Capital Securities issued in
exchange therefor or substitution thereof) shall bear a legend (the
"Restricted Securities Legend") in substantially the following form:
THIS CAPITAL SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES
LAW. NEITHER THIS CAPITAL SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL
SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH
BANKNORTH GROUP, INC. (THE "CORPORATION") OR ANY "AFFILIATE"
OF THE CORPORATION WAS THE OWNER OF THIS CAPITAL
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SECURITY (OR ANY PREDECESSOR OF THIS CAPITAL SECURITY) ONLY
(A) TO THE CORPORATION, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) SO LONG AS THIS CAPITAL SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THIS CAPITAL SECURITY FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A
VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (E)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO
THE RIGHT OF BANKNORTH CAPITAL TRUST I (THE "TRUST") AND THE
CORPORATION PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D)
TO REQUIRE THAT THE TRANSFEROR DELIVER TO THE TRUST A LETTER
FROM THE TRANSFEREE SUBSTANTIALLY IN THE FORM OF ANNEX A TO
THE OFFERING MEMORANDUM DATED APRIL 28, 1997. SUCH HOLDER
FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM
THIS CAPITAL SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN
EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN
OR ARRANGEMENT 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"), OR AN ENTITY WHOSE UNDERLYING ASSETS
INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN
THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF ANY
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PLAN MAY ACQUIRE OR HOLD THE CAPITAL SECURITIES OR ANY
INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE
FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF
LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60,
91-38, 90-1 OR 84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING.
ANY PURCHASE OR HOLDER OF THE CAPITAL SECURITIES OR ANY
INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS
PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT A PLAN
OR PLAN ASSET ENTITY OR (ii) THE ACQUISITION AND HOLDING OF
THIS CAPITAL SECURITY BY IT IS NOT PROHIBITED BY EITHER
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR IS EXEMPT
FROM ANY SUCH PROHIBITION.
In all circumstances, each Capital Security Certificate shall
bear the following legend:
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.
(ii) Upon any sale or transfer of a Restricted Capital
Security (including any Restricted Capital Security represented by the
Global Capital Security) pursuant to an effective registration
statement under the Securities Act or pursuant to Rule 144 under the
Securities Act:
(A) in the case of any Restricted Capital Security
that is a Definitive Capital Security, the Registrar shall
permit the Holder thereof to exchange such Restricted Capital
Security for a Definitive Capital Security that does not bear
the Restricted Securities Legend and rescind any restriction
on the transfer of such Restricted Capital Security; and
(B) in the case of any Restricted Capital Security
that is represented by the Global Capital Security, the
Registrar shall permit the Holder of such
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Global Capital Security to exchange such Global Capital
Security for another Global Capital Security that does not
bear the Restricted Securities Legend.
(j) Cancellation or Adjustment of Global Capital Security. At
such time as all beneficial interests in the Global Capital Security have either
been exchanged for Definitive Capital Securities to the extent permitted by this
Declaration or redeemed, repurchased or canceled in accordance with the terms of
this Declaration, such Global Capital Security shall be returned to the Clearing
Agency for cancellation or retained and canceled by the Property Trustee. At any
time prior to such cancellation, if any beneficial interest in the Global
Capital Security is exchanged for Definitive Capital Securities, Capital
Securities represented by such Global Capital Security shall be reduced and an
adjustment shall be made on the books and records of the Property Trustee and
the Clearing Agency or its nominee to reflect such reduction.
(k) Obligations with Respect to Transfers and Ex-
changes of Capital Securities.
(i) To permit registrations of transfers and exchanges, the
Trust shall execute and the Property Trustee shall authenticate
Definitive Capital Securities and the Global Capital Security at the
Registrar's or co-registrar's request in accordance with the terms of
this Declaration.
(ii) Registrations of transfers or exchanges will be effected
without charge, but only upon payment (with such indemnity as the Trust
or the Sponsor may require) in respect of any tax or other governmental
charge that may be imposed in relation to it.
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of (a) Capital Securities during a
period beginning at the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of Capital
Securities for redemption and ending at the close of business on the
day of such mailing or (b) any Capital Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Capital Security being redeemed in part.
(iv) Prior to the due presentation for registration of
transfer of any Capital Security, the Trust, the Property Trustee, the
Paying Agent, the Registrar or any co-registrar may deem and treat the
Person in whose name a Capital Security is registered as the absolute
owner of such Capital Security for the purpose of receiving
Distributions on such Capital Security and for all other purposes
whatsoever, and none of the Trust, the Property Trustee, the Paying
Agent,
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the Registrar or any co-registrar shall be affected by
notice to the contrary.
(v) All Capital Securities issued upon any registration of
transfer or exchange pursuant to the terms of this Declaration shall
evidence the same security and shall be entitled to the same benefits
under this Declaration as the Capital Securities surrendered upon such
registration of transfer or exchange.
(l) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no responsibility or
obligation to any beneficial owner of the Global Capital Security, a
Participant in the Clearing Agency or other Person with respect to the
accuracy of the records of the Clearing Agency or its nominee or of any
Participant thereof, with respect to any ownership interest in the
Capital Securities or with respect to the delivery to any Participant,
beneficial owner or other Person (other than the Clearing Agency) of
any notice (including any notice of redemption) or the payment of any
amount, under or with respect to such Capital Securities. All notices
and communications to be given to the Holders and all payments to be
made to Holders under the Capital Securities shall be given or made
only to or upon the order of the registered Holders (which shall be the
Clearing Agency or its nominee in the case of the Global Capital
Security). The rights of beneficial owners in the Global Capital
Security shall be exercised only through the Clearing Agency subject to
the applicable rules and procedures of the Clearing Agency. The
Property Trustee may conclusively rely and shall be fully protected in
relying upon information furnished by the Clearing Agency or any agent
thereof with respect to its Participants and any beneficial owners.
(ii) The Property Trustee and the Registrar shall have no
obligation or duty to monitor, determine or inquire as to compliance
with any restrictions on transfer imposed under this Declaration or
under applicable law with respect to any transfer of any interest in
any Capital Security (including any transfers between or among Clearing
Agency Participants or beneficial owners in the Global Capital
Security) other than to require delivery of such Certificates and other
documentation or evidence as are expressly required by, and to do so if
and when expressly required by, the terms of this Declaration, and to
examine the same to determine substantial compliance as to form with
the express requirements hereof.
(m) Exchange of Series A Capital Securities for Series B
Capital Securities. The Series A Capital Securities may
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be exchanged for Series B Capital Securities pursuant to the terms of the
Exchange Offer. The Property Trustee shall make the exchange as follows:
The Sponsor shall present the Property Trustee with an
Officers' Certificate certifying the following:
(A) upon issuance of the Series B Capital
Securities, the transactions contemplated
by the Exchange Offer have been
consummated; and
(B) the number of Series A Capital Securities
properly tendered in the Exchange Offer
that are represented by the Global Capital
Security and the number of Series A Capital
Securities properly tendered in the Ex-
change Offer that are represented by Defin-
itive Capital Securities, the name of each
Holder of such Definitive Capital Securi-
ties, the liquidation amount of Capital
Securities properly tendered in the Ex-
change Offer by each such Holder and the
name and address to which Definitive Capi-
tal Securities for Series B Capital Secu-
rities shall be registered and sent for
each such Holder.
The Property Trustee, upon receipt of (i) such Offi- cers'
Certificate, (ii) an Opinion of Counsel (x) to the effect that the Series B
Capital Securities have been registered under Section 5 of the Securities Act
and that this Declaration and the Series B Capital Securities Guarantee have
been qualified under the Trust Indenture Act and (y) with respect to the matters
set forth in Section 3(p) of the Registration Rights Agreement, shall
authenticate (A) the Global Capital Security for Series B Capital Securities in
aggregate liquidation amount equal to the aggregate liquidation amount of Series
A Capital Securities represented by the Global Capital Security indicated in
such Officers' Certificate as having been properly tendered and (B) Definitive
Capital Securities representing Series B Capital Securities registered in the
names and in the liquidation amounts indicated in such Officers' Certificate.
If, upon consummation of the Exchange Offer, less than all the
outstanding Series A Capital Securities shall have been properly tendered and
not withdrawn, the Property Trustee shall make an endorsement on the Global
Capital Security for Series A 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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The Trust shall deliver such Definitive Capital Securities for
Series B Capital Securities to the Holders thereof as indicated in such
Officers' Certificate.
(n) Minimum Transfers. Series A Capital Securities, and, if
and when issued, Series B Capital Securities, may only be transferred in minimum
blocks of $100,000 aggregate liquidation amount. Any transfer of Series A
Capital Securities or Series B Capital Securities in a block having an aggregate
liquidation amount of less than $100,000 shall be deemed to be voided and of no
legal effect whatsoever. Any such transferee shall be deemed not to be a Holder
of such Series A Capital Securities or Series B 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.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any Security
shall be registered on the books and records of the Trust as the sole owner and
Holder of such Security for purposes of receiving Distributions and for all
other purposes whatsoever and, accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such Security on the part of any
Person, whether or not the Trust shall have actual or other notice thereof.
SECTION 9.4 Book-Entry Interests.
The Global Capital Security shall initially be registered on
the books and records of the Trust in the name of Cede & Co., the nominee of the
Clearing Agency and no Capital Security Beneficial Owner will receive physical
delivery of a definitive Capital Security certificate (a "Capital Security
Certificate") representing such Capital Security Beneficial Owner's interests in
such Global Capital Security, except as provided in Section 9.2 and Section 7.9.
Unless and until Definitive Capital Securities have been issued to the Capital
Security Beneficial Owners pursuant to Section 9.2 or Section 7.9:
(a) the provisions of this Section 9.4 shall be in
full force and effect;
(b) the Trust and the Trustees shall be entitled to deal with
the Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Capital Security and receiving
approvals, votes or consents hereunder) as the sole Holder of the
Global Capital Security and shall have no obligation to the Capital
Security Beneficial Owners;
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(c) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration, the provisions
of this Section 9.4 shall control; and
(d) the rights of the Capital Security Beneficial Owners shall
be exercised only through the Clearing Agency and shall be limited to
those established by law and agreements between such Capital Security
Beneficial Owners and the Clearing Agency and/or the Clearing Agency
Participants, and the Clearing Agency shall receive and transmit
payments of Distributions on the Global Capital Security to such
Clearing Agency Participants; provided, however, that solely for the
purposes of determining whether the Holders of the requisite amount of
Capital Securities have voted on any matter provided for in this
Declaration, so long as Definitive Capital Security Certificates have
not been issued, the Trustees may conclusively rely on, and shall be
protected in relying on, any written instrument (including a proxy)
delivered to the Trustees by the Clearing Agency setting forth the
Capital Security Beneficial Owners' votes or assigning the right to
vote on any matter to any other Persons either in whole or in part; and
the Clearing Agency will also make book-entry transfers among the
Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Capital
Security Holders is required under this Declaration, the Trustees shall give all
such notices and communications specified herein to be given to the Holder of
the Global Capital Security to the Clearing Agency and shall have no notice
obligations to the Capital Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Capital Securities, the Administrative
Trustees may, in their sole discretion, appoint a successor Clearing Agency with
respect to such Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this Declaration, the
Securities Guarantees and the terms of the Securities, the Sponsor shall not be:
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(i) personally liable for the return of any portion
of the capital contributions (or any return thereon) of the
Holders which shall be made solely from assets of the Trust;
and
(ii) required to pay to the Trust or to any Holder
any deficit upon dissolution of the Trust or otherwise.
(b) The Sponsor shall be liable for all of the debts and
obligations of the Trust (other than in respect of the Securities) to the extent
not satisfied out of the Trust's assets.
(c) Pursuant to ss. 3803(a) of the Business Trust Act, the
Holders shall be entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Trust or any Covered Person for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Declaration or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's gross negligence (or, in
the case of the Property Trustee, negligence) or willful misconduct with respect
to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Trust and upon such information, opinions,
reports or statements presented to the Trust by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Trust, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified
Person has duties (including fiduciary duties) and liabilities relating thereto
to the Trust or to any other Covered Person, an Indemnified Person acting under
this Declaration shall
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not be liable to the Trust or to any other Covered Person for its good faith
reliance on the provisions of this Declaration. The provisions of this
Declaration, to the extent that they restrict the duties and liabilities of an
Indemnified Person otherwise existing at law or in equity (other than the duties
imposed on the Property Trustee under the Trust Indenture Act), are agreed by
the parties hereto to replace such other duties and liabilities of such
Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i)whenever a conflict of interest exists or arises
between any Covered Persons, or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is
permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
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SECTION 10.4 Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent
permitted by law, any Company Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the
right of the Trust) by reason of the fact that he is or was a Company
Indemnified Person, against expenses (including attorneys' fees and
expenses), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of NOLO CONTENDERE or its equivalent, shall
not, of itself, create a presumption that the Company Indemnified
Person did not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the full extent permitted
by law, any Company Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Trust to procure a judgment in
its favor by reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees and expenses)
actually and reasonably incurred by him in connection with the defense
or settlement of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the Trust and except that no such indemnification shall be
made in respect of any claim, issue or matter as to which such Company
Indemnified Person shall have been adjudged to be liable to the Trust
unless and only to the extent that the Court of Chancery of Delaware or
the court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of
all the circumstances of the case, such Person is fairly and reasonably
entitled to indemnity for such expenses which such Court of Chancery or
such other court shall deem proper.
(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement
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of an action without admission of liability) in defense of any action,
suit or proceeding referred to in paragraphs (i) and (ii) of this
Section 10.4(a), or in defense of any claim, issue or matter therein,
he shall be indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably incurred
by him in connection therewith.
(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the
Sponsor only as authorized in the specific case upon a determination
that indemnification of the Company Indemnified Person is proper in the
circumstances because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be made (1)
by the Administrative Trustees by a majority vote of a Quorum
consisting of such Administrative Trustees who were not parties to such
action, suit or proceeding, (2) if such a Quorum is not obtainable, or,
even if obtainable, if a Quorum of disinterested Administrative
Trustees so directs, by independent legal counsel in a written opinion,
or (3) by the Common Security Holder of the Trust.
(v) Expenses (including attorneys' fees and expenses) incurred
by a Company Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding referred to
in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the
Sponsor in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such
Company Indemnified Person to repay such amount if it shall ultimately
be determined that he is not entitled to be indemnified by the Sponsor
as authorized in this Section 10.4(a). Notwithstanding the foregoing,
no advance shall be made by the Sponsor if a determination is
reasonably and promptly made (i) by the Administrative Trustees by a
majority vote of a Quorum of disinterested Administrative Trustees,
(ii) if such a Quorum is not obtainable, or, even if obtainable, if a
Quorum of disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion or (iii) by the Common
Security Holder of the Trust, that, based upon the facts known to the
Administrative Trustees, counsel or the Common Security Holder at the
time such determination is made, such Company Indemnified Person acted
in bad faith or in a manner that the Common Security Holder did not
believe to be in or not opposed to the best interests of the Trust, or,
with respect to any criminal proceeding, that such Company Indemnified
Person believed or had reasonable cause to believe his conduct was
unlawful. In no event shall any advance be made in instances where the
Administrative Trustees, independent legal counsel or Common Security
Holder reasonably determine
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that a Company Indemnified Person deliberately breached his duty to the
Trust or its Common or Capital Security Holders.
(vi) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section
10.4(a) shall not be deemed exclusive of any other rights to which
those seeking indemnification and advancement of expenses may be
entitled under any agreement, vote of stockholders or disinterested
directors of the Sponsor or Capital Security Holders of the Trust or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office. All rights to
indemnification under this Section 10.4(a) shall be deemed to be
provided by a contract between the Sponsor and each Company Indemnified
Person who serves in such capacity at any time while this Section
10.4(a) is in effect. Any repeal or modification of this Section
10.4(a) shall not affect any rights or obligations then existing.
(vii) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him
in any such capacity, or arising out of his status as such, whether or
not the Debenture Issuer would have the power to indemnify him against
such liability under the provisions of this Section 10.4(a).
(viii) For purposes of this Section 10.4(a), references to
"the Trust" shall include, in addition to the resulting or surviving
entity, any constituent entity (including any constituent of a
constituent) absorbed in a consolidation or merger, so that any person
who is or was a director, trustee, officer or employee of such
constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent
of another entity, shall stand in the same position under the
provisions of this Section 10.4(a) with respect to the resulting or
surviving entity as he would have with respect to such constituent
entity if its separate existence had continued.
(ix) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 10.4(a) shall, unless
otherwise provided when authorized or ratified, continue as to a Person
who has ceased to be a Company Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a
Person.
(b) The Sponsor agrees to indemnify the (i) Property Trustee,
(ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee or the
Delaware Trustee, and (iv) any officers, directors, shareholders, members,
partners, employees, represen-
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tatives, custodians, nominees or agents of the Property Trustee or the Delaware
Trustee (each of the Persons in (i) through (iv) being referred to as a
"Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified
Person harmless against, any and all loss, liability, damage, claim or expense
including taxes (other than taxes based on the income of such Fiduciary
Indemnified Person) incurred without negligence or bad faith on the part of such
Fiduciary Indemnified Person, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
against or investigating any claim or liability in connection with the exercise
or performance of any of the powers or duties of such Fiduciary Indemnified
Person hereunder. The obligation to indemnify as set forth in this Section
10.4(b) shall survive the resignation or removal of the Property Trustee or the
Delaware Trustee and the satisfaction and discharge of this Declaration.
(c) The Sponsor agrees to pay the Property Trustee and the
Delaware Trustee, from time to time, such compensation for all services rendered
by the Property Trustee and the Dela- ware Trustee hereunder as may be mutually
agreed upon in writing by the Sponsor and the Property Trustee or the Delaware
Trustee, as the case may be, and, except as otherwise expressly provided herein,
to reimburse the Property Trustee and the Delaware Trustee upon its or their
request for all reasonable expenses, disbursements and advances incurred or made
by the Property Trustee or the Delaware Trustee, as the case may be, in
accordance with the provisions of this Declaration, except any such expense,
disbursement or advance as may be attributable to its or their negligence or bad
faith.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee and the
Property Trustee may engage in or possess an interest in other business ventures
of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders shall
have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the business of the Trust, shall not be deemed wrongful
or improper. No Covered Person, the Sponsor, the Delaware Trustee, or the
Property Trustee shall be obligated to present any particular investment or
other opportunity to the Trust even if such opportunity is of a character that,
if presented to the Trust, could be taken by the Trust, and any Covered Person,
the Sponsor, the Delaware Trustee and the Property Trustee shall have the right
to take for its own account (individually or as a partner or fiduciary) or to
recommend to others any such particular investment or other opportunity. Any
Covered Person, the Delaware Trustee and the Property Trustee may
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engage or be interested in any financial or other transaction with the Sponsor
or any Affiliate of the Sponsor, or may act as depositary for, trustee or agent
for, or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the
calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the
Administrative Trustees shall keep, or cause to be kept, full books of account,
records and supporting documents, which shall reflect in reasonable detail each
transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the accrual method of
accounting for United States federal income tax purposes. The books of account
and the records of the Trust shall be examined by and reported upon as of the
end of each Fiscal Year of the Trust by a firm of independent certified public
accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be duly
prepared and delivered to each of the Holders, any annual United States federal
income tax information statement, required by the Code, containing such
information with regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right under the Code
to deliver any such statement at a later date, the Administrative Trustees shall
endeavor to deliver all such information statements within 30 days after the end
of each Fiscal Year of the Trust.
(c) The Administrative Trustees shall cause to be duly
prepared and filed with the appropriate taxing authority, an annual United
States federal income tax return, on a Form 1041 or such other form required by
United States federal income tax law, and any other annual income tax returns
required to be filed by the Administrative Trustees on behalf of the Trust with
any state or local taxing authority.
SECTION 11.3 Banking.
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The Trust may maintain one or more bank accounts in the name
and for the sole benefit of the Trust; provided, however, that all payments of
funds in respect of the Debentures held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust shall
be deposited in the Property Trustee Account. The sole signatories for such
accounts shall be designated by the Administrative Trustees; provided, however,
that the Property Trustee shall designate the signatories for the Property
Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Administrative Trustees shall comply with
all withholding requirements under United States federal, state and local law.
The Trust shall request, and the Holders shall provide to the Trust, such forms
or certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Administrative Trustees shall cause
to be filed required forms with applicable jurisdictions and, unless an
exemption from withholding is properly established by a Holder, shall remit
amounts withheld with respect to the Holder to applicable jurisdictions. To the
extent that the Trust is required to withhold and pay over any amounts to any
authority with respect to Distributions or allocations to any Holder, the amount
withheld shall be deemed to be a Distribution in the amount of the withholding
to the Holder. In the event of any claim of excess withholding, Holders shall be
limited to an action against the applicable jurisdiction. If the amount required
to be withheld was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration
(including Section 7 of Annex I hereto) or by any applicable terms of the
Securities, this Declaration may only be amended by a written instrument
approved and executed by:
(i) the Sponsor and the Administrative Trustees (or,
if there are more than two Administrative Trustees, a major-
ity of the Administrative Trustees);
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(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property Trustee,
the Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee,
the Delaware Trustee.
(b) No amendment shall be made, and any such pur-
ported amendment shall be void and ineffective:
(i) unless, in the case of any proposed amendment, the
Property Trustee shall have first received an Officers' Certificate
from each of the Trust and the Sponsor that such amendment is permitted
by, and conforms to, the terms of this Declaration (including the terms
of the Securities);
(ii) unless, in the case of any proposed amendment which
affects the rights, powers, duties, obligations or immunities of the
Property Trustee, the Property Trustee shall have first received:
(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(B) an Opinion of Counsel (who may be counsel to
the Sponsor or the Trust) that such amendment is permitted by,
and conforms to, the terms of this Declaration (including the
terms of the Securities) and that all conditions precedent to
the execution and delivery of such amendment have been
satisfied;
provided, however, that the Property Trustee shall not be required to sign any
such amendment; and
(iii) to the extent the result of such amendment would
be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income
taxation as a grantor trust;
(B) reduce or otherwise adversely affect the
powers of the Property Trustee in contravention of the
Trust Indenture Act; or
(C) cause the Trust to be deemed to be an In-
vestment Company required to be registered under the
Investment Company Act;
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(c) At such time after the Trust has issued any Securities
that remain outstanding, any amendment that would adversely affect the rights,
privileges or preferences of any Holder may be effected only with such
additional requirements as may be set forth in the terms of such Securities;
(d) Section 10.1(c) and this Section 12.1 shall not
be amended without the consent of all of the Holders;
(e) Article Four shall not be amended without the consent of
the Holders of a Majority in liquidation amount of the Common Securities;
(f) The rights of the Holders of the Common Securities under
Article V to increase or decrease the number of, and appoint and remove Trustees
shall not be amended without the consent of the Holders of a Majority in
liquidation amount of the Common Securities; and
(g) Notwithstanding Section 12.1(c), this Declaration may
be amended without the consent of the Holders to:
(i) cure any ambiguity, correct or supplement any provision in
this Declaration that may be inconsistent with any other provision of
this Declaration or to make any other provisions with respect to
matters or questions arising under this Declaration which shall not be
inconsistent with the other provisions of the Declaration;
(ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the
Trust will be classified for United States federal income tax purposes
as a grantor trust at all times that any Securities are outstanding or
to ensure that the Trust will not be required to register as an
Investment Company under the Investment Company Act; and
(iii) to modify, eliminate or add any provisions of the
Declaration to such extent as shall be necessary to enable the Trust or
the Sponsor to conduct an Exchange Offer in the manner contemplated by
the Registration Rights Agreement;
provided, however, that in each such case, such action shall not adversely
affect in any material respect the interests of the Holders, and any amendments
of this Declaration shall become effective when notice thereof is given to the
Holders.
SECTION 12.2 Meetings of the Holders; Action by Written Consent.
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(a) Meetings of the Holders of any class of Securities may be
called at any time by the Administrative Trustees (or as provided in the terms
of the Securities) to consider and act on any matter on which Holders of such
class of Securities are entitled to act under the terms of this Declaration, the
terms of the Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading. The Administrative Trustees shall
call a meeting of the Holders of such class if directed to do so by the Holders
of at least 10% in liquidation amount of such class of Securities. Such
direction shall be given by delivering to the Administrative Trustees one or
more notices in writing stating that the signing Holders wish to call a meeting
and indicating the general or specific purpose for which the meeting is to be
called. Any Holders calling a meeting shall specify in writing the Capital
Security Certificates held by the Holders exercising the right to call a meeting
and only those Securities specified shall be counted for purposes of determining
whether the required percentage set forth in the second sentence of this
paragraph has been met.
(b) Except to the extent otherwise provided in the terms of
the Securities, the following provisions shall apply to meetings of Holders:
(i) notice of any such meeting shall be given to all the
Holders having a right to vote thereat at least seven days and not more
than 60 days before the date of such meeting. Whenever a vote, consent
or approval of the Holders is permitted or required under this
Declaration or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading, such vote, consent or
approval may be given at a meeting of the Holders. Any action that may
be taken at a meeting of the Holders may be taken without a meeting if
a consent in writing setting forth the action so taken is signed by the
Holders owning not less than the minimum amount of Securities in
liquidation amount that would be necessary to authorize or take such
action at a meeting at which all Holders having a right to vote thereon
were present and voting. Prompt notice of the taking of action without
a meeting shall be given to the Holders entitled to vote who have not
consented in writing. The Administrative Trustees may specify that any
written ballot submitted to the Security Holder for the purpose of
taking any action without a meeting shall be returned to the Trust
within the time specified by the Administrative Trustees;
(ii) each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate,
including waiving notice of any meeting, or voting or participating at
a meeting. No proxy shall be valid after the expiration of eleven
months from the date thereof unless otherwise provided in the proxy.
Every proxy
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shall be revocable at the pleasure of the Holder executing it. Except
as otherwise provided herein, all matters relating to the giving,
voting or validity of proxies shall be governed by the General
Corporation Law of the State of Delaware relating to proxies, and
judicial interpretations thereunder, as if the Trust were a Delaware
corporation and the Holders were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders shall be conducted
by the Administrative Trustees or by such other Person that
the Administrative Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing rules
of any stock exchange on which the Capital Securities are then listed
or trading, otherwise provides, the Administrative Trustees, in their
sole discretion, shall establish all other provisions relating to
meetings of Holders, including notice of the time, place or purpose of
any meeting at which any matter is to be voted on by any Holders,
waiver of any such notice, action by consent without a meeting, the
establishment of a record date, quorum requirements, voting in person
or by proxy or any other matter with respect to the exercise of any
such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property
Trustee.
The Trustee that acts as initial Property Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
(a) The Property Trustee is a banking corporation, a national
banking association or a bank or trust company organized under the laws of the
United States, any State of the United States or the District of Columbia, as
the case may be, in any case with trust powers and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Declaration;
(b) The execution, delivery and performance by the Property
Trustee of this Declaration has been duly authorized by all necessary corporate
action on the part of the Property Trustee; and this Declaration has been duly
executed and de-
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livered 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
Declaration by the Property Trustee does not conflict with or constitute a
breach of the charter or by-laws of the Property Trustee; and
(d) No consent, approval or authorization of, or registration
with or notice to, any applicable Illinois, New York or federal banking
authority is required for the execution, delivery or performance by the Property
Trustee of this Declaration.
SECTION 13.2 Representations and Warranties of Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents
and warrants to the Trust and to the Sponsor at the date of this Declaration,
and each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee is duly organized, validly existing
and in good standing under the laws of the State of Delaware with corporate
power and authority to execute and deliver, and to carry out and perform its
obligations under the terms of, this Declaration;
(b) The execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary corporate
action on the part of the Delaware Trustee; and this Declaration has been duly
executed and delivered by the Delaware Trustee and constitutes a legal, valid
and binding obligation of the Delaware Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law);
(c) The execution, delivery and performance of this
Declaration by the Delaware Trustee does not conflict with or
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constitute a breach of the charter or by-laws of the Delaware
Trustee; and
(d) No consent, approval or authorization of, or registration
with or notice to, any federal or Delaware banking authority is required for the
execution, delivery or performance by the Delaware Trustee of this Declaration;
and
(e) The Delaware Trustee is a natural person who is a resident
of the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware, and is a Person that
satisfies for the Trust Section 3807(a) of the Business Trust Act.
ARTICLE XIV
REGISTRATION RIGHTS
SECTION 14.1 Registration Rights Agreement; Liquidated Damages.
The Holders of the Series A Capital Securities, the Series A Debentures
and the Series A Capital Securities Guarantee are entitled to the benefits of
the Registration Rights Agreement. In certain limited circumstances set forth in
the Registration Rights Agreement, the Debenture Issuer shall be required to pay
Liquidated Damages with respect to the Debentures. Unless otherwise stated, the
term "Distribution", as used in this Declaration, includes any such Liquidated
Damages.
ARTICLE XV
MISCELLANEOUS
SECTION 15.1 Notices.
All notices provided for in this Declaration shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by first class mail, overnight courier service or confirmed
telecopy, as follows:
(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other address
as the Trust may give notice of to the Property Trustee, the Delaware Trustee
and the Holders):
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Banknorth Capital Trust I
c/o Banknorth Group, Inc.
300 Financial Plaza
P.O. Box 5420
Burlington, Vermont 05401
Telecopier: (802) 860-5437
Telephone: (802) 860-2492
Attention Neal E. Robinson
Administrative Trustee
(b) if given to the Delaware Trustee, at the mailing address
set forth below (or such other address as Delaware Trustee may give notice of to
the Holders):
First Chicago Delaware Inc.
300 King Street
Wilmington, Delaware 19801
Telecopier: (302) 651-8882
Telephone: (302) 651-1000
Attention: Michael J. Majchrzak
(c) if given to the Property Trustee, at the Property
Trustee's mailing address set forth below (or such other address as the Property
Trustee may give notice of to the Holders):
The First National Bank of Chicago
One First National Plaza Mall, Suite 0126
Chicago, IL 60670-0126
Telecopier: (212) 373-1383
Telephone: (212) 373-1191
Attention: Corporate Trust Administration
(d) if given to the Holder of the Common Securities, at the
mailing address of the Sponsor set forth below (or such other address as the
Holder of the Common Securities may give notice to the Trust):
Banknorth Group, Inc.
300 Financial Plaza
P.O. Box 5420
Burlington, Vermont 05401
Telecopier: (802) 860-5437
Telephone: (802) 658-2492
Attention: Neal E. Robinson
Senior Vice President and Treasurer
(e) if given to any other Holder, at the address set
forth on the books and records of the Trust.
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All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 15.2 Governing Law.
This Declaration and the rights of the parties hereunder shall
be governed by and interpreted in accordance with the laws of the State of
Delaware and all rights and remedies shall be governed by such laws without
regard to conflict of law principles.
SECTION 15.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be
classified for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention of
the parties.
SECTION 15.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the interpretation of this
Declaration or any provision hereof.
SECTION 15.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto is
named or referred to, the successors and assigns of such party shall be deemed
to be included, and all covenants and agreements in this Declaration by the
Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 15.6 Partial Enforceability.
If any provision of this Declaration, or the application of
such provision to any Person or circumstance, shall be held invalid, the
remainder of this Declaration, or the application of such provision to Persons
or circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 15.7 Counterparts.
This Declaration may contain more than one counterpart of the
signature page and this Declaration may be executed by the affixing of the
signature of each of the Trustees to one of such counterpart signature pages.
All of such counterpart signature
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pages shall be read as though one, and they shall have the same force and effect
as though all of the signers had signed a single signature page.
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IN WITNESS WHEREOF, the undersigned has caused these presents
to be executed as of the day and year first above written.
BANKNORTH CAPITAL TRUST I
-----------------------------------
Thomas J. Pruitt,
as Administrative Trustee
-----------------------------------
Neal E. Robinson,
as Administrative Trustee
----------------------------------
James D. Adams,
as Administrative Trustee
FIRST CHICAGO DELAWARE INC.
as Delaware Trustee
By:
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO
as Property Trustee
By:
Name:
Title:
BANKNORTH GROUP, INC.
as Sponsor and Debenture Issuer
By:
Name:
Title:
<PAGE>
ANNEX I
TERMS OF
10.52% CAPITAL SECURITIES, SERIES A/SERIES B
10.52% COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of May 1, 1997 (as amended from time to time, the
"Declaration"), the designation, rights, privileges, restrictions, preferences
and other terms and provisions of the Securities are set out below (each
capitalized term used but not defined herein has the meaning set forth in the
Declaration or, if not defined in such Declaration, as defined in the Offering
Memorandum referred to below in Section 2(c) of this Annex I):
1. Designation and Number.
(a) Capital Securities. 30,000 Series A Capital Securities of
the Trust and 30,000 Series B Capital Securities of the Trust, each series with
an aggregate liquidation amount with respect to the assets of the Trust of
thirty million dollars ($30,000,000), and each with a liquidation amount with
respect to the assets of the Trust of $1,000 per security, are hereby designated
for the purposes of identification only as "10.52% Capital Securities, Series A"
and "10.52% Capital Securities, Series B", respectively (collectively, the
"Capital Securities"). The certificates evidencing the Capital Securities shall
be substantially in the form of Exhibit A-1 to the Declaration, with such
changes and additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice or to conform to the rules of any exchange or
quotation system on or in which the Capital Securities are listed, traded or
quoted.
(b) Common Securities. 928 Common Securities of the Trust with
an aggregate liquidation amount with respect to the assets of the Trust of nine
hundred twenty eight thousand dollars ($928,000) and a liquidation amount with
respect to the assets of the Trust of $1,000 per security, are hereby designated
for the purposes of identification only as "10.52% Common Securities"
(collectively, the "Common Securities"). The Certificates evidencing the Common
Securities shall be substantially in the form of Exhibit A-2 to the Declaration,
with such changes and additions thereto or deletions therefrom as may be
required by ordinary usage, custom or practice.
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2. Distributions.
(a) Distributions payable on each Security will be fixed at a
rate per annum of 10.52% (the "Coupon Rate") of the liquidation amount of $1,000
per Security (the "Liquidation Amount"), such rate being the rate of interest
payable on the Debentures to be held by the Property Trustee. Distributions in
arrears for more than one semi-annual period will bear additional Distributions
thereon compounded semi-annually at the Coupon Rate (to the extent permitted by
applicable law). Pursuant to the Registration Rights Agreement, in certain
limited circumstances the Debenture Issuer will be required to pay Liquidated
Damages (as defined in the Registration Rights Agreement) with respect to the
Debentures. The term "Distributions", as used herein, includes distributions of
any such interest and Liquidated Damages, if any, payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds legally available therefor.
(b) Distributions on the Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from May 1, 1997, and will be payable
semi-annually in arrears on May 1 and November 1 of each year, commencing on
November 1, 1997 (each, a "Distribution Date"), except as otherwise described
below. Distributions will be computed on the basis of a 360-day year consisting
of twelve 30-day months. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
at any time and from time to time on the Debentures for a period not exceeding
10 consecutive semi-annual periods, including the first such semi-annual period
during such period (each an "Extension Period"), during which Extension Period
no interest shall be due and payable on the Debentures, provided that no
Extension Period shall end on a date other than an Interest Payment Date for the
Debentures or extend beyond the Maturity Date of the Debentures. As a
consequence of such deferral, Distributions will also be deferred.
Notwithstanding such deferral, Distributions will continue to accumulate with
additional Distributions thereon (to the extent permitted by applicable law but
not at a rate greater than the rate at which interest is then accruing on the
Debentures) at the Coupon Rate compounded semi-annually during any such
Extension Period. Prior to the termination of any such Extension Period, the
Debenture Issuer may further defer payments of interest by further extending
such Extension Period, provided that such extension does not cause such
Extension Period, together with all such previous and further extensions within
such Extension Period, to exceed 10 consecutive semi-annual periods, including
the first semi-annual period during such Extension Period, end on a date other
than an Interest Payment
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Date for the Debentures or extend beyond the Maturity Date of the Debentures.
Upon the termination of any Extension Period and the payment of all amounts then
due, the Debenture Issuer may commence a new Extension Period, subject to the
above requirements.
(c) Distributions on the Securities will be payable to the
Holders thereof as they appear on the books and records of the Trust on the
close of business on the 15th day of the month next preceding that in which the
relevant Distribution Date occurs, which Distribution Dates correspond to the
Interest Payment Dates for the Debentures. Subject to any applicable laws and
regulations and the provisions of the Declaration, each such payment in respect
of the Capital Securities will be made as described under the heading
"Description of Capital Securities -- Form, Denomination, Book-Entry Procedures
and Transfer" in the Offering Memorandum dated April 28, 1997, of the Debenture
Issuer and the Trust relating to the Securities and the Debentures. The relevant
record dates for the Common Securities shall be the same as the record dates for
the Capital Securities. Distributions payable on any Securities that are not
punctually paid on any Distribution Date, as a result of the Debenture Issuer
having failed to make a payment under the Debentures, will cease to be payable
to the Holder on the relevant record date, and such defaulted Distribution will
instead be payable to the Person in whose name such Securities are registered on
the special record date or other specified date determined in accordance with
the Indenture. If any date on which Distributions are payable on the Securities
is not a Business Day, then payment of the Distribution payable on such date
will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), with the same force and
effect as if made on such date.
(d) In the event that there is any money or other property
held by or for the Trust that is not accounted for hereunder, such property
shall be distributed Pro Rata (as defined herein) among the Holders.
3. Liquidation Distribution Upon Dissolution.
In the event of any dissolution of the Trust, or if the
Sponsor otherwise gives notice of its election to liquidate the Trust pursuant
to Section 8.1(a)(iii) of the Declaration, the Trust shall be liquidated by the
Administrative Trustees as expeditiously as the Administrative Trustees
determine to be possible by distributing to the Holders, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, a Like
Amount (as defined below) of the Debentures, unless such distribution is
determined by the Property Trustee not to be practicable, in which event such
Holders will be entitled to receive Pro Rata out of the assets of the Trust
legally available for distribution to Holders, after satisfaction of liabilities
to
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creditors of the Trust as provided by applicable law, an amount equal to the
aggregate of the liquidation amount of $1,000 per Security plus accumulated and
unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the
Securities, Securities having a Liquidation Amount equal to the principal amount
of Debentures to be paid in accordance with their terms and (ii) with respect to
a distribution of Debentures upon the liquidation of the Trust, Debentures
having a principal amount equal to the Liquidation Amount of the Securities of
the Holder to whom such Debentures are distributed.
If, upon any such liquidation, the Liquidation Distribution
can be paid only in part because the Trust has insufficient assets legally
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Securities shall be paid on a Pro
Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or in part, at
maturity or otherwise (either at the option of the Debenture Issuer or pursuant
to a Special Event, as described below), the proceeds from such repayment shall
be simultaneously applied by the Property Trustee (subject to the Property
Trustee having received written notice no later than 45 days prior to such
repayment) to redeem a Like Amount of the Securities at a redemption price equal
to (i) in the case of the repayment of the Debentures at maturity, the Maturity
Redemption Price (as defined below), (ii) in the case of the optional redemption
of the Debentures prior to the Initial Optional Redemption Date and upon the
occurrence and continuation of a Special Event, the Special Event Redemption
Price (as defined below) and (iii) in the case of the optional redemption of the
Debentures on or after the Initial Optional Redemption Date, the Optional
Redemption Price (as defined below). The Maturity Redemption Price, the Special
Event Redemption Price and the Optional Redemption Price are referred to
collectively as the "Redemption Price". Holders will be given not less than 30
nor more than 60 days' prior written notice of such redemption.
(b) (i) The "Maturity Redemption Price", with respect to a
redemption of Securities, shall mean an amount equal to the principal of and
accrued and unpaid interest on the Debentures as of the maturity date thereof.
(ii) In the case of an optional redemption, if fewer than all
the outstanding Securities are to be so redeemed, the Common Securities and the
Capital Securities shall be redeemed PRO RATA and the Capital Securities to be
redeemed will be
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determined as described in Section 4(f)(ii) below. Upon the entry of an order
for the dissolution of the Trust by a court of competent jurisdiction, the
Debentures thereafter will be subject to optional repayment, in whole, but not
in part, on or after the Initial Optional Redemption Date.
The Debenture Issuer shall have the right (subject to the
conditions in the Indenture) to elect to redeem the Debentures, in whole or in
part, at any time on or after May 1, 2007 (the "Initial Optional Redemption
Date"), upon not less than 30 days and not more than 60 days' prior written
notice, and, simultaneous with such redemption, to cause a Like Amount of the
Securities to be redeemed by the Trust at the Optional Redemption Price on a Pro
Rata basis. "Optional Redemption Price" shall mean a price equal to the
percentage of the liquidation amount of Securities to be redeemed plus
accumulated and unpaid Distributions thereon, if any, to the date of such
redemption if redeemed during the 12-month period beginning May 1 of the years
indicated below:
Percentage of
Year Principal
2007 105.260%
2008 104.734%
2009 104.208%
2010 103.682%
2011 103.156%
2012 102.630%
2013 102.104%
2014 101.578%
2015 101.052%
2016 100.526%
2017 and thereafter 100.000%
(c) If at any time a Tax Event or a Regulatory Capital Event
(each as defined below, and each a "Special Event") occurs, the Debenture Issuer
shall have the right (subject to the conditions set forth in the Indenture) at
any time prior to the Initial Optional Redemption Date, upon not less than 30
nor more than 60 days' prior written notice, to redeem the Debentures in whole,
but not in part, within the 90 days following the occurrence of such Special
Event (the "90 Day Period"), and, simultaneous with such redemption, to cause a
Like Amount of the Securities to be redeemed by the Trust at the Special Event
Redemption Price on a Pro Rata basis.
"Make-Whole Amount" shall mean an amount equal to the greater
of (x) 100% of the principal of Debentures or (y) the sum, as determined by a
Quotation Agent (as defined in the Indenture), of the present values of the
remaining scheduled payments of principal and interest on the Debentures,
discounted
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to the redemption date on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Adjusted Treasury Rate (as defined in
the Indenture), plus, in the case of each of clauses (x) and (y), accrued and
unpaid interest thereon, including Compounded Interest, Additional Sums and
Liquidated Damages (each as defined in the Indenture), if any, to the date of
redemption.
A "Tax Event" shall occur upon receipt by the Debenture Issuer
and the Trust of an opinion of counsel experienced in such matters to the effect
that, as a result of any amendment to, or change (including any announced
prospective change) in, the laws or any regulations thereunder of the United
States or any political subdivision or taxing authority thereof or therein, or
as a result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after May 1,
1997, there is more than an insubstantial risk that (i) the Trust is, or will be
within 90 days of the date of such opinion, subject to United States federal
income tax with respect to income received or accrued on the Debentures, (ii)
the interest payable by the Debenture Issuer on the Debentures is not, or within
90 days of the date of such opinion will not be, deductible by the Debenture
Issuer, in whole or in part, for United States federal income tax purposes, or
(iii) the Trust is, or will be within 90 days of the date of such opinion,
subject to more than a DE MINIMIS amount of other taxes, duties or other
governmental charges.
"Regulatory Capital Event" shall mean that the Debenture
Issuer shall have received an opinion of independent bank regulatory counsel
experienced in such matters to the effect that, as a result of (a) any amendment
to, or change (including any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any rules, guidelines or
policies of an applicable regulatory authority for the Debenture Issuer or (b)
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after May 1, 1997, the
Capital Securities do not constitute, or within 90 days of the date thereof,
will not constitute, Tier 1 Capital (or its then equivalent); provided, however,
that the distribution of the Debentures in connection with the liquidation of
the Trust by the Debenture Issuer shall not in and of itself constitute a
Regulatory Capital Event unless such liquidation shall have occurred in
connection with a Tax Event.
"Special Event Redemption Price" shall mean, with respect to
any redemption of Securities following a Special Event, an amount in cash equal
to the Make-Whole Amount.
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(d) On and from the date fixed by the Administrative Trustees
for any distribution of Debentures and liquidation of the Trust: (i) the
Securities will no longer be deemed to be outstanding, (ii) the Clearing Agency
or its nominee (or any successor Clearing Agency or its nominee), as the Holder
of the Capital Securities, will receive a registered global Certificate or
Certificates representing the Debentures to be delivered upon such distribution,
and (iii) any Certificates representing Securities not held by the Clearing
Agency or its nominee (or any successor Clearing Agency or its nominee) will be
deemed to represent beneficial interests in a Like Amount of Debentures until
such Certificates are presented to the Debenture Issuer or its agent for
transfer or reissue.
(e) The Trust may not redeem fewer than all the outstanding
Securities unless all accumulated and unpaid Distributions have been paid on all
Securities for all semi-annual Distribution periods terminating on or before the
date of redemption.
(f) The procedure with respect to redemptions or distributions
of Securities shall be as follows:
(i) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution
Notice") will be given by the Trust by mail to each Holder to be
redeemed or exchanged not fewer than 30 nor more than 60 days before
the date fixed for redemption or exchange thereof which, in the case of
a redemption, will be the date fixed for redemption of the Debentures.
For purposes of the calculation of the date of redemption or exchange
and the dates on which notices are given pursuant to this Section
4(f)(i), a Redemption/ Distribution Notice shall be deemed to be given
on the day such notice is first mailed by first-class mail, postage
prepaid, to Holders. Each Redemption/Distribution Notice shall be
addressed to the Holders at the address of each such Holder appearing
in the books and records of the Trust. No defect in the
Redemption/Distribution Notice or in the mailing of either thereof with
respect to any Holder shall affect the validity of the redemption or
exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the particular Securities to be redeemed
shall be selected on a Pro Rata basis (based upon Liquidation Amounts)
not more than 60 nor less than 30 days prior to the date fixed for
redemption from the outstanding Securities not previously called for
redemption; provided, however, that with respect to Holders that would
be required to hold less than 100 but more than zero Securities as a
result of such redemption, the Trust shall
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redeem Securities of each such Holder so that after such redemption
such Holder shall hold either 100 Securities or such Holder no longer
holds any Securities, and shall use such method (including, without
limitation, by lot) as the Trust shall deem fair and appropriate;
provided, further, that any such redemption may be made on the basis of
the aggregate Liquidation Amount of Securities held by each Holder
thereof and may be made by making such adjustments as the Trust deems
fair and appropriate in order that fractional Securities shall not
thereafter remain outstanding. In respect of Capital Securities
registered in the name of and held of record by the Clearing Agency or
its nominee (or any successor Clearing Agency or its nominee) or any
nominee, the distribution of the proceeds of such redemption will be
made to the Clearing Agency and disbursed by such Clearing Agency in
accordance with the procedures applied by such agency or nominee.
(iii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice (which notice will be irrevocable), then
(A) with respect to Capital Securities issued in book-entry form, by
12:00 noon, New York City time, on the redemption date, provided that
the Debenture Issuer has paid the Property Trustee a sufficient amount
of cash in connection with the related redemption or maturity of the
Debentures by 10:00 a.m., New York City time, on the Maturity Date or
the date of redemption, as the case requires, the Property Trustee will
deposit irrevocably with the Clearing Agency or its nominee (or
successor Clearing Agency or its nominee) immediately available funds
sufficient to pay the applicable Redemption Price with respect to such
Capital Securities and will give the Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the relevant
Clearing Agency Participants, and (B) with respect to Capital
Securities issued in certificated form and Common Securities, provided
that the Debenture Issuer has paid the Property Trustee a sufficient
amount of cash in connection with the related redemption or maturity of
the Debentures, the Property Trustee will pay the relevant Redemption
Price to the Holders by check mailed to the address of the relevant
Holder appearing on the books and records of the Trust on the
redemption date. If a Redemption/Distribution Notice shall have been
given and funds deposited as required, if applicable, then immediately
prior to the close of business on the date of such deposit, or on the
redemption date, as applicable, Distributions will cease to accumulate
on the Securities so called for redemption and all rights of Holders so
called for redemption will cease, except the right of the Holders of
such Securities to receive the Redemption Price, but without interest
on such Redemption Price, and such Securities shall cease to be
outstanding.
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(iv) Payment of accumulated and unpaid Distributions on the
Redemption Date of the Securities will be subject to the rights of
Holders on the close of business on a regular record date in respect of
a Distribution Date occurring on or prior to such Redemption Date.
Neither the Administrative Trustees nor the Trust shall be
required to register or cause to be registered the transfer of (i) any
Securities beginning on the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of Securities for
redemption or (ii) any Securities selected for redemption except the unredeemed
portion of any Security being redeemed. If any date fixed for redemption of
Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such next succeeding Business Day falls in the next calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Property Trustee or by the
Sponsor as guarantor pursuant to the relevant Securities Guarantee,
Distributions on such Securities will continue to accumulate from the original
redemption date to the actual date of payment, in which case the actual payment
date will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by the
Property Trustee on behalf of the Trust to (A) in respect of Capital
Securities issued in book-entry form, the Clearing Agency or its
nominee (or any successor Clearing Agency or its nominee), (B) in
respect of Capital Securities issued in certificated form, to the
Holders thereof, and (C) in respect of the Common Securities, to the
Holder thereof.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws and banking
laws), the Sponsor or any of its subsidiaries may at any time and from
time to time purchase outstanding Capital Securities by tender, in the
open market or by private agreement.
5. Voting Rights - Capital Securities.
(a) Except as provided under Sections 5(b) and 7 and
as otherwise required by law and the Declaration, the Holders of
the Capital Securities will have no voting rights.
(b) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and
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place of conducting any proceeding for any remedy available to the Debenture
Trustee or executing any trust or power conferred on such Debenture Trustee with
respect to the Debentures, (ii) waive any past default that is waivable under
Section 5.07 of the Indenture, (iii) exercise any right to rescind or annul a
declaration of acceleration of the maturity of the principal of the Debentures
or (iv) consent to any amendment, modification or termination of the Indenture
or the Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of a Majority in liquidation amount
of all outstanding Capital Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior approval of each Holder of the Capital Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of the Capital Securities except by subsequent vote of such Holders. The
Property Trustee shall notify each Holder of Capital Securities of any notice of
default with respect to the Debentures. In addition to obtaining the foregoing
approvals of such Holders of the Capital Securities, prior to taking any of the
foregoing actions, the Trustees shall obtain an opinion of counsel experienced
in such matters to the effect that the Trust will continue to be classified as a
grantor trust for United States federal income tax purposes after taking any
such action into account.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (or, in the case of redemption, on the redemption date), then a
Holder of Capital Securities may directly institute a proceeding for enforcement
of payment to such Holder of the principal of or premium, if any, or interest on
a Like Amount of Debentures (a "Direct Action") on or after the respective due
date specified in the Debentures. In connection with such Direct Action, the
rights of the Common Securities Holder will be subrogated to the rights of such
Holder of Capital Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Capital Securities in such Direct Action. Except as
provided in the second preceding sentence, the Holders of Capital Securities
will not be able to exercise directly any other remedy available to the holders
of the Debentures.
Any approval or direction of Holders of Capital Securities may
be given at a separate meeting of Holders of Capital Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust 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
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is to be taken, to be mailed to each Holder of record of Capital Securities.
Each such notice will include a statement setting forth (i) the date of such
meeting or the date by which such action is to be taken, (ii) a description of
any resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consent.
No vote or consent of the Holders of the Capital Securities
will be required for the Trust to redeem and cancel Capital Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
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 Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and 7 or as
otherwise required by law and the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) Unless a Debenture Event of Default shall have occurred
and be continuing, any Trustee may be removed at any time by the Holder of the
Common Securities. If a Debenture Event of Default has occurred and is
continuing, the Property Trustee and the Delaware Trustee may be removed at such
time by the Holders of a Majority in liquidation amount of the outstanding
Capital Securities. In no event will the Holders of the Capital Securities have
the right to vote to appoint, remove or replace the Administrative Trustees,
which voting rights are vested exclusively in the Sponsor as the Holder of the
Common Securities. No resignation or removal of a Trustee and no appointment of
a successor trustee shall be effective until the acceptance of appointment by
the successor trustee in accordance with the provisions of the Declaration.
(c) So long as any Debentures are held by the Property
Trustee, the Trustees shall not (i) direct the time, method and place of
conducting any proceeding for any remedy available to the Debenture Trustee, or
executing any trust or power conferred on such Debenture Trustee with respect to
the Debentures, (ii) waive any past default that is waivable under Section 5.07
of the Indenture, (iii) exercise any right to rescind or annul a declaration of
acceleration of the maturity of the principal of the Debentures or (iv) consent
to any amendment, modification or termination of the Indenture or the
Debentures, where such
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consent shall be required, without, in each case, obtaining the prior approval
of the Holders of a Majority in liquidation amount of all outstanding Common
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Debentures affected thereby, no such
consent shall be given by the Property Trustee without the prior approval of
each Holder of the Common Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the Holders of the Common
Securities except by subsequent vote of such Holders. The Property Trustee shall
notify each Holder of Common Securities of any notice of default with respect to
the Debentures. In addition to obtaining the foregoing approvals of such Holders
of the Common Securities, prior to taking any of the foregoing actions, the
Trustees shall obtain an opinion of counsel experienced in such matters to the
effect that the Trust will continue to be classified as a grantor trust for
United States federal income tax purposes after taking any such action into
account.
If an Event of Default under the Declaration has occurred and
is continuing and such event is attributable to the failure of the Debenture
Issuer to pay principal of or premium, if any, or interest on the Debentures on
the due date (or in the case of redemption, on the redemption date), then a
Holder of Common Securities may institute a Direct Action for enforcement of
payment to such Holder of the principal of or premium, if any, or interest on a
Like Amount of Debentures on or after the respective due date specified in the
Debentures. In connection with such Direct Action, the rights of the Common
Securities Holder will be subordinated to the rights of such Holder of Capital
Securities in respect of any payment from the Debenture Issuer in such Direct
Action. Except as provided in the second preceding sentence, the Holders of
Common Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
Any approval or direction of Holders of Common Securities may
be given at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Administrative Trustees will cause a notice of
any meeting at which Holders of Common Securities are entitled to vote, or of
any matter upon which action by written consent of such Holders is to be taken,
to be mailed to each Holder of record of Common Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought and (iii) instructions
for the delivery of proxies or consents.
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No vote or consent of the Holders of the Common Securities
will be required for the Trust to redeem and cancel Common Securities or to
distribute the Debentures in accordance with the Declaration and the terms of
the Securities.
7. Amendments to Declaration.
In addition to the requirements set out in Section 12.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor,
the Property Trustee and the Administrative Trustees without the consent of the
Holders (i) to cure any ambiguity, correct or supplement any provisions in the
Declaration that may be inconsistent with any other provisions, or to make any
other provisions with respect to matters or questions arising under the
Declaration which shall not be inconsistent with the other provisions of the
Declaration, (ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an Investment Company under the Investment
Company Act or (iii) to modify, eliminate or add any provisions of the
Declaration to such extent as shall be necessary to enable the Trust or the
Sponsor to conduct an Exchange Offer in the manner contemplated by the
Registration Rights Agreement; provided, however, that in each case, such action
shall not adversely affect in any material respect the interests of any Holder,
and any amendments of the Declaration shall become effective when notice thereof
is given to the Holders. The Declaration may also be amended by the Trustees and
the Sponsor with (i) the consent of Holders representing a Majority in
liquidation amount of all outstanding Securities, and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an Investment
Company under the Investment Company Act; provided, however, that, without the
consent of each Holder of Trust Securities, the Declaration may not be amended
to (i) change the amount or timing of any Distribution on, or the payment
required to be made in respect of the Trust Securities as of a specified date or
(ii) restrict the right of a Holder of Trust Securities to institute suit for
the enforcement of any such payment on or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate liquidation amount of the Securities held by the
relevant Holder in relation
I-13
<PAGE>
to the aggregate liquidation amount of all Securities outstanding unless, in
relation to a payment, an Event of Default under the Declaration has occurred
and is continuing, in which case any funds available to make such payment shall
be paid first to each Holder of the Capital Securities pro rata according to the
aggregate liquidation amount of Capital Securities held by the relevant Holder
relative to the aggregate liquidation amount of all Capital Securities
outstanding and then, only after satisfaction of all amounts owed to the Holders
of the Capital Securities, to each Holder of Common Securities pro rata
according to the aggregate liquidation amount of Common Securities held by the
relevant Holder relative to the aggregate liquidation amount of all Common
Securities outstanding.
9. Ranking.
The Capital Securities rank pari passu with the Common
Securities and payment thereon shall be made Pro Rata with the Common
Securities, except that, if an Event of Default under the Declaration occurs and
is continuing, no payments in respect of Distributions on, or payments upon
liquidation, redemption or otherwise with respect to, the Common Securities
shall be made until the Holders of the Capital Securities shall be paid in full
the Distributions, Redemption Price, Liquidation Distribution and other payments
to which they are entitled at such time.
10. Acceptance of Capital Securities Guarantee, Common
Securities Guarantee, Indenture and Debentures .
Each Holder of Capital Securities and Common Securities, by
the acceptance thereof, agrees to the provisions of the Capital Securities
Guarantee, the Common Securities Guarantee, the Indenture and the Debentures, as
applicable, including the subordination provisions therein.
11. No Preemptive Rights.
The issuance of Capital Securities and the issuance of Common
Securities is not subject to preemptive or other similar rights. The Holders
shall have no preemptive rights to subscribe for any additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee, as applicable,
and the Indenture (including any supplemental indenture) to a Holder without
charge upon written request to the Sponsor at its principal place of business.
I-14
<PAGE>
EXHIBIT A-1
to the Amended and Restated
Declaration of Trust
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
[IF THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY,
INSERT: THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE MEANING OF
THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY (THE "CLEARING AGENCY") OR A NOMINEE OF THE CLEARING
AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL 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
CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS CAPITAL 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 CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE CLEARING AGENCY TO THE TRUST OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY 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., 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.]
[THIS CAPITAL SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS CAPITAL
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH BANKNORTH
GROUP, INC. (THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE
OWNER OF THIS CAPITAL SECURITY (OR ANY PREDECESSOR OF THIS CAPITAL SECURITY)
ONLY (A) TO THE CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS CAPITAL
SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
A1-1
<PAGE>
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE
IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1),
(2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS
CAPITAL SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF
BANKNORTH CAPITAL TRUST I (THE "TRUST") AND THE CORPORATION PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND (ii) PURSUANT TO CLAUSE (D) TO REQUIRE THAT
THE TRANSFEROR DELIVER TO THE TRUST A LETTER FROM THE TRANSFEREE SUBSTANTIALLY
IN THE FORM OF ANNEX A TO THE OFFERING MEMORANDUM DATED APRIL 28, 1997. SUCH
HOLDER FURTHER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CAPITAL
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.]
THE HOLDER OF THIS CAPITAL SECURITY BY ITS ACCEPTANCE HEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT,
INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT 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"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON
OF ANY PLAN'S INVESTMENT IN THE ENTITY AND NO PERSON INVESTING "PLAN ASSETS" OF
ANY PLAN MAY ACQUIRE OR HOLD THE CAPITAL SECURITIES OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE
UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23,
95-60, 91-38, 90-1 OR 84-14 WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY
PURCHASE OR HOLDER OF THE CAPITAL SECURITIES OR ANY INTEREST THEREIN WILL BE
DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i)
IT IS NOT A PLAN OR PLAN ASSET ENTITY OR (ii) THE ACQUISITION AND HOLDING OF
THIS CAPITAL SECURITY BY IT IS NOT PROHIBITED BY EITHER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE OR IS EXEMPT FROM ANY SUCH PROHIBITION.
IN ALL CIRCUMSTANCES, EACH CAPITAL SECURITY CERTIFICATE
SHALL BEAR THE FOLLOWING LEGEND:
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
A1-2
<PAGE>
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.
A1-3
<PAGE>
Certificate Number: _______________ Aggregate Liquidation
Amount: $
CUSIP Number:
Certificate Evidencing Capital Securities
of
Banknorth Capital Trust I
__% Capital Securities, Series __
(liquidation amount $1,000 per Capital Security)
Banknorth Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
______________ (the "Holder") is the registered owner of [$_________ in
aggregate liquidation amount of Capital Securities of the Trust]1 [the aggregate
liquidation amount of Capital Securities of the Trust specified in Schedule A
hereto]2 representing undivided preferred beneficial interests in the assets of
the Trust designated the __% Capital Securities, Series __ (liquidation amount
$1,000 per Capital Security) (the "Capital Securities"). The Capital Securities
are transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Capital Securities represented
hereby are issued and shall in all respects be subject to the provisions of the
Amended and Restated Declaration of Trust of the Trust, dated as of May 1, 1997,
as the same may be amended from time to time (the "Declaration"), including the
designation of the terms of the Capital Securities as set forth in Annex I to
the Declaration. Capitalized terms used but not defined herein shall have the
meaning given them in the Declaration. The Sponsor will provide a copy of the
Declaration, the Capital Securities Guarantee, and the Indenture (including any
supplemental indenture) to a Holder without charge upon written request to the
Trust at its principal place of business.
Upon receipt of this Certificate, the Holder is bound
by the Declaration and is entitled to the benefits thereunder and
to the benefits of the Capital Securities Guarantee to the extent
provided therein.
- --------
1 Insert in Definitive Capital Securities only.
2 Insert in Global Capital Securities only.
A1-4
<PAGE>
By acceptance hereof, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Capital Securities as evidence of indirect beneficial ownership in the
Debentures.
A1-5
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate
this __ day of _________, ____.
BANKNORTH CAPITAL TRUST I
By:________________________________
Name:
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the
within-mentioned Declaration.
Dated: __________ __, ____
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but sole-
ly as Property Trustee
By:
Authorized Signatory
A1-6
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Capital Security will be fixed
at a rate per annum of 10.52% (the "Coupon Rate") of the liquidation amount of
$1,000 per Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any such
interest and any Liquidated Damages payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds legally available therefor.
Distributions on the Capital Securities will be cumulative,
will accumulate from the most recent date to which Distributions have been paid
or, if no Distributions have been paid, from May 1, 1997 and will be payable
semi-annually in arrears, on May 1 and November 1 of each year, commencing on
November 1, 1997, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30- day months. As
long as no Event of Default has occurred and is continuing under the Indenture,
the Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time to
time on the Debentures for a period not exceeding 10 consecutive calendar
semi-annual periods, including the first such semi-annual period during such
extension period (each an "Extension Period"), provided that no Extension Period
shall end on a date other than an Interest Payment Date for the Debentures or
extend beyond the Maturity Date of the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Notwithstanding such deferral,
semi-annual Distributions will continue to accumulate with interest thereon (to
the extent permitted by applicable law, but not at a rate exceeding the rate of
interest then accruing on the Debentures) at the Coupon Rate compounded
semi-annually during any such Extension Period. Prior to the termination of any
Extension Period, the Debenture Issuer may further defer payments of interest by
further extending such Extension Period; provided that such Extension Period,
together with all such previous and further extensions within such Extension
Period, may not (i) exceed 10 consecutive semi-annual periods, including the
first semi-annual period during such Extension Period, (ii) end on a date other
than an Interest Payment Date for the Debentures or (iii) extend beyond the
Maturity Date of the Debentures. Payments of accumulated Dis-
A1-7
<PAGE>
tributions will be payable to Holders as they appear on the books and records of
the Trust on the record date immediately preceding the end of the Extension
Period. Upon the termination of any Extension Period and the payment of all
amounts then due, the Debenture Issuer may commence a new Extension Period,
subject to the above requirements.
Subject to receipt by the Sponsor of any required regulatory
approvals and to certain other conditions set forth in the Declaration and the
Indenture, the Property Trustee may, at the direction of the Sponsor, at any
time terminate the Trust and cause the Debentures to be distributed to the
holders of the Securities in liquidation of the Trust or, simultaneously with
any redemption of the Debentures, cause a Like Amount of the Securities to be
redeemed by the Trust.
The Capital Securities shall be redeemable as provided in the
Declaration.
A1-8
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital 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 Capital Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: _______________________
Signature: __________________
(Sign exactly as your name appears on the other side of this Capital Security
Certificate)
Signature Guarantee***: ___________________________________
- --------
*** Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Registrar, which requirements include
membership or participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities and Exchange Act of 1934,
as amended.
A1-9
<PAGE>
[Include the following if the Capital Security bears a Restricted
Securities Legend --
In connection with any transfer of any of the Capital Securities evidenced by
this Certificate, the undersigned confirms that such Capital Securities are
being:
CHECK ONE BOX BELOW
(1) |_| exchanged for the undersigned's own account with-
out transfer; or
(2) |_| transferred pursuant to and in compliance with
Rule 144A under the Securities Act of 1933; or
(3) |_| transferred to an institutional "accredited inves-
tor" within the meaning of subparagraph (a)(1),
(2), (3) or (7) of Rule 501 under the Securities
Act of 1933 that is acquiring the Capital Securi-
ties for its own account, or for the account of
such an institutional "accredited investor," for
investment purposes and not with a view to, or for
offer or sale in connection with, any distribution
in violation of the Securities Act of 1933; or
(4) |_| transferred pursuant to another available exemp-
tion from the registration requirements of the
Securities Act of 1933; or
(5) |_| transferred pursuant to an effective registration
statement.
Unless one of the boxes is checked, the Registrar will refuse to register any of
the Capital Securities evidenced by this Certificate in the name of any Person
other than the Holder hereof; provided, however, that if box (3) or (4) is
checked, the Registrar may require, prior to registering any such transfer of
the Capital Securities, such legal opinions, certifications and other
information as the Trust has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, such as the
exemption provided by Rule 144 under such Act; provided, further, that (i) if
box (2) is checked, the transferee must also certify that it is a "qualified
institutional buyer" (as defined in Rule 144A) acquiring the Capital Securities
for its own account or for the account of another QIB over which it exercises
sole investment discretion and it is aware that the Holder is relying upon the
exemption from registration afforded by Rule 144A in respect of the Holder's
transfer of Capital Securities to it or (ii) if box (3) is checked, the
transferee must also provide to
A1-10
<PAGE>
the Registrar a Transferee Letter of Representation in the form attached to the
Offering Memorandum of the Trust dated April 28, 1997; provided, further, that
after the date that a registration statement has been filed and so long as such
Registration Statement continues to be effective, only then may the Registrar
permit transfers for which box (5) has been checked.
Signature
A1-11
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS COMMON
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS COMMON SECURITY BY ITS ACCEPTANCE HEREOF
AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS COMMON SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUANCE DATE HEREOF AND THE LAST DATE ON WHICH BANKNORTH
GROUP, INC. (THE "CORPORATION") OR ANY "AFFILIATE" OF THE CORPORATION WAS THE
OWNER OF THIS CAPITAL SECURITY (OR ANY PREDECESSOR OF THIS CAPITAL SECURITY)
ONLY (A) TO THE CORPORATION, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THIS COMMON
SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7)
OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS COMMON SECURITY FOR
ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (E)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
UNDER THE SECURITIES ACT, SUBJECT TO THE RIGHT OF BANKNORTH CAPITAL TRUST I (THE
"TRUST") AND THE CORPORATION PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i)
PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii)
PURSUANT TO CLAUSE (D) TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE REVERSE OF THIS COMMON SECURITY IS COMPLETED AND DELIVERED BY
THE TRANSFEREE TO THE TRUST. SUCH HOLDER FURTHER AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS COMMON SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND.
A2-1
<PAGE>
Certificate Evidencing Common Securities
of
Banknorth Capital Trust I
10.52% Common Securities
(liquidation amount $1,000 per Common Security)
Banknorth Capital Trust I, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
Banknorth Group, Inc. (the "Holder") is the registered owner of nine hundred
twenty eight (928) common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the 10.52% Common
Securities (liquidation amount $1,000 per Common Security) (the "Common
Securities"). The Common Securities are transferable on the books and records of
the Trust, in person or by a duly authorized attorney, upon surrender of this
Certificate duly endorsed and in proper form for transfer. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Common Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of May 1, 1997, as the same may be amended from time to time
(the "Declaration"), including the designation of the terms of the Common
Securities as set forth in Annex I to the Declaration. Capitalized terms used
but not defined herein shall have the meaning given them in the Declaration. The
Sponsor will provide a copy of the Declaration, the Common Securities Guarantee
and the Indenture (including any supplemental indenture) to a Holder without
charge upon written request to the Sponsor at its principal place of business.
Upon receipt of this Certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Common Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees to treat, for United
States federal income tax purposes, the Debentures as indebtedness and the
Common Securities as evidence of indirect beneficial ownership in the
Debentures.
A2-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate
this 1st day of May, 1997.
BANKNORTH CAPITAL TRUST I
By:________________________________
Name:
Administrative Trustee
A2-3
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions payable on each Common Security will be fixed at
a rate per annum of 10.52% (the "Coupon Rate") of the liquidation amount of
$1,000 per Common Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any such
interest and any Liquidated Damages payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds legally available therefor.
Distributions on the Common Securities will be cumulative,
will accrue from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from May 1, 1997 and will be payable
semi-annually in arrears, on May 1 and November 1 of each year, commencing on
November 1, 1997, except as otherwise described below. Distributions will be
computed on the basis of a 360-day year consisting of twelve 30- day months. As
long as no Event of Default has occurred and is continuing under the Indenture,
the Debenture Issuer has the right under the Indenture to defer payments of
interest by extending the interest payment period at any time and from time to
time on the Debentures for a period not exceeding 10 consecutive calendar
semi-annual periods, including the first such semi-annual period during such
extension period (each an "Extension Period"), provided that no Extension Period
shall end on a date other than an Interest Payment Date for the Debentures or
extend beyond the Maturity Date of the Debentures. As a consequence of such
deferral, Distributions will also be deferred. Notwithstanding such deferral,
Distributions will continue to accumulate with interest thereon (to the extent
permitted by applicable law, but not at a rate exceeding the rate of interest
then accruing on the Debentures) at the Coupon Rate compounded semi-annually
during any such Extension Period. Prior to the termination of any Extension
Period, the Debenture Issuer may further defer payments of interest by further
extending such Extension Period; provided that such Extension Period, together
with all such previous and further extensions within such Extension Period, may
not (i) exceed 10 consecutive semi-annual periods, including the first
semi-annual period during such Extension Period, (ii) end on a date other than
an Interest Payment Date for the Debentures or (iii) extend beyond the Maturity
Date of the Debentures. Payments of accrued Distributions will be payable to
Holders as they appear on the books and records of the Trust on the record date
immediately preceding the end of the Extension Period. Upon the termination of
any Exten-
A2-4
<PAGE>
sion Period and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
Subject to the receipt by the Sponsor of any required
regulatory approvals and to certain other conditions set forth in the
Declaration and the Indenture, the Property Trustee may, at the direction of the
Sponsor, at any time terminate the Trust and cause the Debentures to be
distributed to the holders of the Securities in liquidation of the Trust or,
simultaneously with any redemption of the Debentures, cause a Like Amount of the
Securities to be redeemed by the Trust.
The Common Securities shall be redeemable as provided in the
Declaration.
Under certain circumstances, the right of the holders of the
Common Securities shall be subordinate to the rights of the holders of the
Capital Securities, as provided in the Declaration.
A2-5
<PAGE>
Exhibit 4.6
CAPITAL SECURITY CERTIFICATE
[THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY WITHIN THE MEANING OF
THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITORY TRUST COMPANY ("THE CLEARING AGENCY") OR A NOMINEE OF THE CLEARING
AGENCY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL 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
CAPITAL SECURITY (OTHER THAN A TRANSFER OF THIS CAPITAL 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 CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE CLEARING AGENCY TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY 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., 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 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.
1
<PAGE>
Certificate Number: 001 Aggregate Liquidation Amount:
CUSIP Number: $
Certificate Evidencing Capital Securities
of
BANKNORTH CAPITAL TRUST I
10.52% Capital Securities, Series B
(liquidation amount of $1,000 per Capital Security)
BANKNORTH CAPITAL TRUST I, a statutory business trust created under the
laws of the State of Delaware (the "Trust"), hereby certifies that ____________
(the "Holder") is the registered owner of ______________________ in aggregate
liquidation amount of Capital Securities of the Trust representing undivided
preferred beneficial interests in the assets of the Trust designated the 10.52%
Capital Securities, Series B (liquidation amount of $1,000 per Capital Security)
(the "Capital Securities"). The Capital Securities are transferable on the books
and records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities represented hereby are issued and shall in
all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust, dated as of May 1, 1997, as the same may be
amended from time to time (the "Declaration"), including the designation of the
terms of the Capital Securities as set forth in Annex I to the Declaration.
Capitalized terms used but not defined herein shall have the meaning given them
in the Declaration. The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee and the Indenture (including any supplement
indenture) to a Holder without charge upon written request to the Trust at its
principal place of business.
Upon receipt of this Certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder and to the benefits of the Capital
Securities Guarantee to the extent provided therein.
By acceptance hereof, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Capital
Securities as evidence of indirect beneficial ownership in the Debentures.
2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this certificate this __ day of
_________________, 1997.
BANKNORTH CAPITAL TRUST I
By:
------------------------------------------
Name:
Administrative Trustee
<PAGE>
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in the within-mentioned
Declaration.
Dated: ______________ __, 1997
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity,
but solely as Property Trustee
By:
---------------------------------
Authorized Signatory
<PAGE>
REVERSE OF SECURITY
Distributions payable on each Capital Security will be fixed at a
rate per annum of 10.52% (the "Coupon Rate") of the liquidation amount of $1,000
per Capital Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. Distributions in arrears for more
than one semi-annual period will bear interest thereon compounded semi-annually
at the Coupon Rate (to the extent permitted by applicable law). Pursuant to the
Registration Rights Agreement, in certain limited circumstances the Debenture
Issuer will be required to pay Liquidated Damages (as defined in the
Registration Rights Agreement) with respect to the Debentures. The term
"Distributions", as used herein, includes such cash distributions and any such
interest and any Liquidated Damages payable unless otherwise stated. A
Distribution is payable only to the extent that payments are made in respect of
the Debentures held by the Property Trustee and to the extent the Property
Trustee has funds legally available therefor.
Distributions on the Capital Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or,
if no Distributions have been paid, from [May 1, 1997] [November 1, 1997], and
will be payable semi-annually in arrears, on May 1 and November 1 of each year,
commencing on [November 1, 1997] [May 1, 1998], except as otherwise described
below. Distributions shall be computed on the basis of a 360-day year consisting
of twelve 30-day months. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the right under the
Indenture to defer payments of interest by extending the interest payment period
at any time and from time to time on the Debentures for a period not exceeding
10 consecutive calendar semi-annual periods, including the first such semi-
annual period during such extension period (each an "Extension Period"),
provided that no Extension Period shall end on a date other than an Interest
Payment Date for the Debentures or extend beyond the Maturity Date of the
Debentures. As a consequence of such deferral, Distributions will also be
deferred. Notwithstanding such deferral, semi-annual Distributions will continue
to accumulate with interest thereon (to the extent permitted by applicable law,
but not at a rate exceeding the rate of interest then accruing on the
Debentures) at the Coupon Rate compounded semi-annually during any such
Extension Period. Prior to the termination of any Extension Period, the
Debenture Issuer may further defer payments of interest by further extending
such Extension Period; provided that such Extension Period, together with all
such previous and further extensions within such Extension Period, may not (i)
exceed 10 consecutive semi-annual periods, including the first semi-annual
period during such Extension Period, (ii) end on a date other than an Interest
Payment Date for the Debentures or (iii) extend beyond the Maturity Date of the
Debentures. Payments of accumulated Distributions will be payable to Holders as
they appear on the books and records of the Trust on the first record date
immediately preceding the end of the Extension Period. Upon the termination of
any Extension Period and the payment of all amounts then due, the Debenture
Issuer may commence a new Extension Period, subject to the above requirements.
Subject to receipt by the Sponsor of any required regulatory approvals and
to certain other conditions set forth in the Declaration and the Indenture, the
Property Trustee may, at the direction of the Sponsor, at any time terminate the
Trust and cause the Debentures to be distributed to the holders of the
Securities in liquidation of the Trust or, simultaneously with any redemption of
the Debentures, cause a Like Amount of the Securities to be redeemed by the
Trust.
The Capital Securities shall be redeemable as provided in the Declaration.
5
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital
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 Capital Security
Certificate on the books of the Trust. The agent may substitute another to act
for him or her.
Date: ___________________
Signature: ______________________
(Sign exactly as your name appears on the other side of this Capital 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.
6
Exhibit 4.7
========================================
SERIES B CAPITAL SECURITIES GUARANTEE AGREEMENT
BANKNORTH GROUP, INC.
Dated as of , 1997
========================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation................................. -2-
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.............................. -5-
SECTION 2.2 Lists of Holders of Securities................................ -6-
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee........... -6-
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee...... -6-
SECTION 2.5 Evidence of Compliance with Conditions Precedent.............. -7-
SECTION 2.6 Waiver of Events of Default................................... -7-
SECTION 2.7 Notice of Events of Default................................... -7-
SECTION 2.8 Conflicting Interests......................................... -7-
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE................. -8-
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee. -8-
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee........ -10-
SECTION 3.3. Not Responsible for Recitals or Issuance of Series A Capital
Securities Guarantee......................................... -12-
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility............. -12-
SECTION 4.2 Appointment, Removal and Resignation of Capital
Securities Guarantee Trustee................................. -13-
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee..................................................... -14-
SECTION 5.2 Waiver of Notice and Demand................................... -14-
SECTION 5.3 Obligations Not Affected...................................... -14-
<PAGE>
SECTION 5.4 Rights of Holders............................................. -15-
SECTION 5.5 Guarantee of Payment.......................................... -16-
SECTION 5.6 Subrogation................................................... -16-
SECTION 5.7 Independent Obligations....................................... -16-
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.................................... -16-
SECTION 6.2 Ranking....................................................... -17-
ARTICLE VII
TERMINATION
SECTION 7.1 Termination................................................... -18-
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation................................................... -18-
SECTION 8.2 Compensation and Indemnification.............................. -18-
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns........................................ -19-
SECTION 9.2 Amendments.................................................... -19-
SECTION 9.3 Notices....................................................... -19-
SECTION 9.4 Benefit....................................................... -21-
SECTION 9.5 Governing Law................................................. -21-
-iii-
<PAGE>
CROSS REFERENCE TABLE
Section of Trust Section of
Indenture Act of Guarantee
1939, as amended Agreement
- ---------------- ----------
310(a) .............................. 4.1(a)
310(b) .............................. 4.1(c), 2.8
310(c) .............................. Inapplicable
311(a) .............................. 2.2(b)
311(b) .............................. 2.2(b)
311(c) .............................. Inapplicable
312(a) .............................. 2.2(a)
312(b) .............................. 2.2(b)
313 .............................. 2.3
314(a) .............................. 2.4
314(b) .............................. Inapplicable
314(c) .............................. 2.5
314(d) .............................. Inapplicable
314(e) .............................. 1.1, 2.5, 3.2
314(f) .............................. 2.1, 3.2
315(a) .............................. 3.1(d)
315(b) .............................. 2.7
315(c) .............................. 3.1(c)
315(d) .............................. 3.1(d)
316(a) .............................. 1.1, 2.6, 5.4
316(b) .............................. 5.3
316(c) .............................. 9.2
317(a) .............................. Inapplicable
317(b) .............................. Inapplicable
318(a) .............................. 2.1(a)
318(c) .............................. 2.1(b)
- ----------
* This Cross-Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
-iv-
<PAGE>
SERIES B CAPITAL SECURITIES GUARANTEE AGREEMENT
This SERIES B CAPITAL SECURITIES GUARANTEE AGREEMENT (the
"Series B Capital Securities Guarantee"), dated as of ____________ , 1997, is
executed and delivered by Banknorth Group, Inc., a Delaware corporation (the
"Guarantor"), and The First National Bank of Chicago, as trustee (the "Capital
Securities Guarantee Trustee" or "Trustee"), for the benefit of the Holders (as
defined herein) from time to time of the Series A Capital Securities (as defined
herein) of Banknorth Capital Trust I, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of May 1, 1997, among the trustees of the
Issuer, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer, the Issuer (i) has
issued on the date hereof 30,000 capital securities, having an aggregate
liquidation amount of $30,000,000, such capital securities being designated the
10.52% Capital Securities, Series A (collectively the "Series A Capital
Securities") and (ii) is issuing on the date hereof _________ capital
securities, having an aggregate liquidation amount of $____________, such
capital securities being designated the 10.52% Capital Securities, Series B
(the "Series B Capital Securities") in connection with the Exchange Offer (as
defined in the Declaration).
WHEREAS, as incentive for the Holders to exchange the Series A
Capital Securities for the Series B Capital Securities, the Guarantor desires
irrevocably and unconditionally to agree, to the extent set forth in this Series
B Capital Securities Guarantee, to pay the Guarantee Payments (as defined below)
to the Holders of the Series B Capital Securities, and the Guarantor agrees to
make certain other payments on the terms and conditions set forth herein.
WHEREAS, the Guarantor has executed and delivered a guarantee
agreement (the "Common Securities Guarantee"), for the benefit of the holders of
the Common Securities (as defined herein), the terms of which provide that if an
Event of Default (as defined in the Declaration) has occurred and is continuing,
the rights of holders of the Common Securities to receive Guarantee Payments
under the Common Securities Guarantee are subordinated, to the extent and in the
manner set forth in the Common Securities Guarantee, to the rights of Holders of
Series A Capital Securities and the Series B Capital Securities to receive
Guarantee Payments under this Series A Capital Securities Guarantee and this
Series B Capital Securities Guarantee, as the case may be.
NOW, THEREFORE, in consideration of the exchange by each
Holder of Series B Capital Securities, which exchange the Guarantor hereby
acknowledges shall benefit the Guarantor, the Guarantor executes and delivers
this Series B Capital Securities Guarantee for the benefit of the Holders.
<PAGE>
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Series B Capital Securities Guarantee, unless the
context otherwise requires:
(a) capitalized terms used in this Series B Capital Securities
Guarantee but not defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) terms defined in the Declaration as at the date of
execution of this Series B Capital Securities Guarantee have the same meaning
when used in this Series B Capital Securities Guarantee unless otherwise defined
in this Series B Capital Securities Guarantee;
(c) a term defined anywhere in this Series B Capital
Securities Guarantee has the same meaning throughout;
(d) all references to "the Series B Capital Securities
Guarantee" or "this Series B Capital Securities Guarantee" are to this Series B
Capital Securities Guarantee as modified, supplemented or amended from time to
time;
(e) all references in this Series B Capital Securities
Guarantee to Articles and Sections are to Articles and Sections of this Series B
Capital Securities Guarantee, unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the same
meaning when used in this Series B Capital Securities Guarantee, unless
otherwise defined in this Series B Capital Securities Guarantee or unless the
context otherwise requires; and
(g) a reference to the singular includes the plural and vice
versa.
"Affiliate" has the same meaning as given to that term in Rule
405 under the Securities Act of 1933, as amended, or any successor rule
thereunder.
"Business Day" shall mean any day other than a Saturday or a
Sunday, or a day on which banking institutions in The City of New York or
Burlington, Vermont are authorized or required by law or executive order to
close.
"Capital Securities Guarantee Trustee" shall mean The First
National Bank of Chicago, until a Successor Capital Securities Guarantee Trustee
has been appointed
-2-
<PAGE>
and has accepted such appointment pursuant to the terms of this Series B Capital
Securities Guarantee and thereafter means each such Successor Capital Securities
Guarantee Trustee.
"Common Securities" shall mean the securities representing
common undivided beneficial interests in the assets of the Issuer.
"Corporate Trust Office" shall mean the office of the Capital
Securities Guarantee Trustee at which the corporate trust business of the
Capital Securities Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at One First National Plaza, Suite 0126, Chicago, Illinois
60670.
"Covered Person" shall mean any Holder or beneficial owner of
Series B Capital Securities.
"Debentures" shall mean the series of subordinated debt
securities of the Guarantor designated the 10.52% Junior Subordinated Deferrable
Interest Debentures due May 1, 2027, Series B, held by the Property Trustee (as
defined in the Declaration) of the Issuer.
"Event of Default" shall mean a default by the Guarantor on
any of its payment or other obligations under this Series B Capital Securities
Guarantee; provided, however, that, except with respect to default in respect of
any Guarantee Payment, the Guarantor shall have received written notice of the
default and shall not have cured such default within 60 days after receipt
thereof.
"Guarantee Payments" shall mean the following payments or
distributions, without duplication, with respect to the Series B Capital
Securities, to the extent not paid or made by or on behalf of the Issuer: (i)
any accumulated and unpaid Distributions (as defined in the Declaration) that
are required to be paid on such Series B Capital Securities, to the extent the
Issuer has funds legally available therefor at such time, (ii) the redemption
price, including all accumulated and unpaid Distributions to the date of
redemption (the "Redemption Price"), to the extent the Issuer has funds legally
available therefor at such time, with respect to any Series B Capital Securities
called for redemption, and (iii) upon a voluntary or involuntary termination and
liquidation of the Issuer (other than in connection with the distribution of
Debentures to the Holders in exchange for Series B Capital Securities as
provided in the Declaration), the lesser of (a) the aggregate of the liquidation
amount and all accumulated and unpaid Distributions on the Series B Capital
Securities to the date of payment, to the extent the Issuer has funds legally
available therefor at such time, and (b) the amount of assets of the Issuer
remaining available for distribution to Holders after satisfaction of
liabilities to creditors of the Issuer as required by applicable law (in either
case, the "Liquidation Distribution"). If an Event of Default has occurred and
is continuing, no Guarantee Payments under the Common Securities Guarantee with
respect to the Common Securities or any guarantee payment under the Common
Securities Guarantee or any Other Common Securities Guarantee shall be made
until the Holders of Series B Capital
-3-
<PAGE>
Securities shall be paid in full the Guarantee Payments to which they are
entitled under this Series B Capital Securities Guarantee.
"Holder" shall mean any holder, as registered on the books and
records of the Issuer, of any Series B Capital Securities; provided, however,
that, in determining whether the holders of the requisite percentage of Series B
Capital Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" shall mean the Capital Securities
Guarantee Trustee, any Affiliate of the Capital Securities Guarantee Trustee, or
any officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Capital Securities
Guarantee Trustee.
"Indenture" shall mean the Indenture, dated as of May 1, 1997,
between Banknorth Group, Inc., as issuer of Debentures (the "Debenture Issuer"),
and The First National Bank of Chicago, as trustee, pursuant to which the
Debentures are to be issued to the Property Trustee of the Issuer.
"Majority in liquidation amount of the Series B Capital
Securities" shall mean, except as provided by the Trust Indenture Act, a vote by
Holder(s) of Series B Capital Securities, voting separately as a class, of more
than 50% of the aggregate liquidation amount (including the amount that would be
paid on redemption, liquidation or otherwise, plus accumulated and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Series B Capital Securities.
"Officers' Certificate" shall mean, with respect to any
person, a certificate signed by the chairman, a vice chairman, the chief
executive officer, the president, an executive or senior vice president, a vice
president, the treasurer or an assistant treasurer of the Guarantor. Any
Officers' Certificate delivered with respect to compliance with a condition or
covenant provided for in this Series B Capital Securities Guarantee shall
include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
(b) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is necessary to
enable such officer to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(c) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
-4-
<PAGE>
"Other Common Securities Guarantees" shall have the same
meaning as "Other Guarantees" in the Common Securities Guarantee.
"Other Debentures" shall mean all junior subordinated
debentures issued by the Guarantor from time to time and sold to trusts other
than the Issuer to be established by the Guarantor (if any), in each case
similar to the Issuer.
"Other Guarantees" shall mean all guarantees to be issued by
the Guarantor with respect to capital securities (if any) similar to the Series
B Capital Securities issued by trusts other than the Issuer to be established by
the Guarantor (if any), in each case similar to the Issuer.
"Person" shall mean a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Responsible Officer" shall mean, with respect to the Capital
Securities Guarantee Trustee, any officer within the Corporate Trust Office of
the Capital Securities Guarantee Trustee with direct responsibility for the
administration of this Series B Capital Securities Guarantee and also means,
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of that officer's knowledge of and familiarity
with the particular subject.
"Successor Capital Securities Guarantee Trustee" shall mean a
successor Capital Securities Guarantee Trustee possessing the qualifications to
act as Capital Securities Guarantee Trustee under Section 4.1.
"Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended.
"Trust Securities" shall mean the Common Securities and the
Series A Capital Securities and Series B Capital Securities, collectively.
-5-
<PAGE>
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Series B Capital Securities Guarantee is subject to
the provisions of the Trust Indenture Act that are required to be part of this
Series B Capital Securities Guarantee and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Series B
Capital Securities Guarantee limits, qualifies or conflicts with the duties
imposed by Section 310 to 317, inclusive, of the Trust Indenture Act, such
imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Capital Securities
Guarantee Trustee (unless the Capital Securities Guarantee Trustee is otherwise
the registrar of the Capital Securities) with a list, in such form as the
Capital Securities Guarantee Trustee may reasonably require, of the names and
addresses of the Holders of the Series B Capital Securities ("List of Holders")
as of such date, (i) within fourteen (14) days after May 1 and November 1 of
each year, and (ii) at any other time within 30 days of receipt by the Guarantor
of a written request for a List of Holders as of a date no more than 14 days
before such List of Holders is given to the Capital Securities Guarantee
Trustee; provided that the Guarantor shall not be obligated to provide such List
of Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Capital Securities Guarantee Trustee by the
Guarantor. The Capital Securities Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.
(b) The Capital Securities Guarantee Trustee shall comply with
its obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee
Within 60 days after May 1 of each year, commencing May 1,
1998, the Capital Securities Guarantee Trustee shall provide to the Holders of
the Series A Capital Securities such reports as are required by Section 313 of
the Trust Indenture Act, if any, in the form and in the manner provided by
Section 313 of the Trust Indenture Act. The Capital Securities Guarantee Trustee
shall also comply with the requirements of Section 313(d) of the Trust Indenture
Act.
SECTION 2.4 Periodic Reports to Capital Securities Guarantee Trustee
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information as required by Section
314 (if any) and the
-6-
<PAGE>
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. Delivery of such reports, information and documents to the
Capital Securities Guarantee Trustee is for informational purposes only and the
Capital Securities Guarantee Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Guarantor's compliance with any of
its covenants hereunder (as to which the Capital Securities Guarantee Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Series B Capital Securities Guarantee that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) may be given in the form of an Officers' Certificate.
SECTION 2.6 Waiver of Events of Default
The Holders of a Majority in liquidation amount of Series B
Capital Securities may, by vote, on behalf of the Holders of all of the Series B
Capital Securities, 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 Series B Capital Securities Guarantee, but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent thereon.
SECTION 2.7 Notice of Events of Default
(a) The Capital Securities Guarantee Trustee shall, within 10
Business Days after the occurrence of an Event of Default with respect to this
Capital Securities Guarantee actually known to a Responsible Officer of the
Capital Securities Guarantee Trustee, mail by first class postage prepaid, to
all Holders of the Series B Capital Securities, notices of all such Events of
Default, unless such Events of Default have been cured before the giving of such
notice; provided, that, except in the case of an Event of Default arising from
the non-payment of any Guarantee Payment, the Capital Securities Guarantee
Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee, or a trust committee of directors
and/or Responsible Officers of the Capital Securities Guarantee Trustee in good
faith determines that the withholding of such notice is in the interests of the
holders of the Series B Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Capital Securities
Guarantee Trustee shall have received written notice, or a Responsible Officer
of the Capital Securities Guarantee
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Trustee charged with the administration of the Declaration shall have obtained
actual knowledge, of such Event of Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically described
in this Series B Capital Securities Guarantee for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guarantee Trustee
(a) This Series B Capital Securities Guarantee shall be held
by the Capital Securities Guarantee Trustee for the benefit of the Holders of
the Series B Capital Securities, and the Capital Securities Guarantee Trustee
shall not transfer this Series B Capital Securities Guarantee to any Person
except a Holder of Series B Capital Securities exercising his or her rights
pursuant to Section 5.4(b) or to a Successor Capital Securities Guarantee
Trustee on acceptance by such Successor Capital Securities Guarantee Trustee of
its appointment to act as Successor Capital Securities Guarantee Trustee. The
right, title and interest of the Capital Securities Guarantee Trustee shall
automatically vest in any Successor Capital Securities Guarantee Trustee, and
such vesting and succession of title shall be effective whether or not
conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Capital Securities Guarantee Trustee.
(b) If an Event of Default actually known to a Responsible
Officer of the Capital Securities Guarantee Trustee has occurred and is
continuing, the Capital Securities Guarantee Trustee shall enforce this Series B
Capital Securities Guarantee for the benefit of the Holders of the Series B
Capital Securities.
(c) The Capital Securities Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Series B Capital Securities Guarantee, and no
implied covenants shall be read into this Series B Capital Securities Guarantee
against the Capital Securities Guarantee Trustee. In case an Event of Default
has occurred (that has not been cured or waived pursuant to Section 2.6) and is
actually known to a Responsible Officer of the Capital Securities Guarantee
Trustee, the Capital Securities Guarantee Trustee shall exercise such of the
rights and powers vested in it by this Series B Capital Securities Guarantee,
and use the same degree of care and skill in its exercise thereof, as a prudent
person would exercise or use under the circumstances in the conduct of his or
her own affairs.
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(d) No provision of this Series B Capital Securities Guarantee
shall be construed to relieve the Capital Securities Guarantee Trustee from
liability for its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:
(A) the duties and obligations of the Capital Securities
Guarantee Trustee shall be determined solely by the express
provisions of this Series B Capital Securities Guarantee, and
the Capital Securities Guarantee Trustee shall not be liable
except for the performance of such duties and obligations as
are specifically set forth in this Series B Capital Securities
Guarantee, and no implied covenants or obligations shall be
read into this Series B Capital Securities Guarantee against
the Capital Securities Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Capital Securities Guarantee Trustee, the Capital Securities
Guarantee Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the
Capital Securities Guarantee Trustee and conforming to the
requirements of this Series B Capital Securities Guarantee;
provided, however, that in the case of any such certificates
or opinions that by any provision hereof are specifically
required to be furnished to the Capital Securities Guarantee
Trustee, the Capital Securities Guarantee Trustee shall be
under a duty to examine the same to determine whether or not
they conform to the requirements of this Series B Capital
Securities Guarantee;
(ii) the Capital Securities Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a Responsible
Officer of the Capital Securities Guarantee Trustee, unless it shall
be proved that the Capital Securities Guarantee Trustee or such
Responsible Officer was negligent in ascertaining the pertinent
facts upon which such judgment was made;
(iii) the Capital Securities Guarantee Trustee shall not be
liable with respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the Holders of a
Majority in liquidation amount of the Series B Capital Securities
relating to the time, method and place of conducting any proceeding
for any remedy available to the Capital Securities Guarantee
Trustee, or exercising any trust or power conferred upon the Capital
Securities Guarantee Trustee under this Series B Capital Securities
Guarantee; and
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(iv) no provision of this Series B Capital Securities
Guarantee shall require the Capital Securities Guarantee Trustee to
expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if the Capital Securities Guarantee
Trustee shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to it
under the terms of this Series B Capital Securities Guarantee or
indemnity, reasonably satisfactory to the Capital Securities
Guarantee Trustee, against such risk or liability is not reasonably
assured to it.
SECTION 3.2 Certain Rights of Capital Securities Guarantee Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Capital Securities Guarantee Trustee may conclusively
rely, and shall be fully protected in acting or refraining from
acting, upon any resolution, certificate, statement instrument,
opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed, sent
or presented by the proper party or parties;
(ii) Any direction or act of the Guarantor contemplated by
this Series B Capital Securities Guarantee may be sufficiently
evidenced by an Officers' Certificate;
(iii) Whenever, in the administration of this Series B Capital
Securities Guarantee, the Capital Securities Guarantee Trustee shall
deem it desirable that a matter be proved or established before
taking, suffering or omitting any action hereunder, the Capital
Securities Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly delivered by
the Guarantor;
(iv) The Capital Securities Guarantee Trustee shall have no
duty to see to any recording, filing or registration of any
instrument (or any rerecording, refiling or registration thereof);
(v) The Capital Securities Guarantee Trustee may consult with
counsel of its selection, and the advice or opinion of such counsel
with respect to legal matters shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance
with such advice or opinion; and such counsel may be counsel to the
Guarantor or any of its Affiliates and may include any of its
employees. The Capital Securities Guarantee Trustee shall have the
right at any time to
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seek instructions concerning the administration of this Series B
Capital Securities Guarantee from any court of competent
jurisdiction;
(vi) The Capital Securities Guarantee Trustee shall be under
no obligation to exercise any of the rights or powers vested in it
by this Series B Capital Securities Guarantee at the request or
direction of any Holder, unless such Holder shall have provided to
the Capital Securities Guarantee Trustee such security and
indemnity, reasonably satisfactory to the Capital Securities
Guarantee Trustee, against the costs, expenses (including attorneys'
fees and expenses and the expenses of the Capital Securities
Guarantee Trustee's agents, nominees or custodians) and liabilities
that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by
the Capital Securities Guarantee Trustee; provided, that nothing
contained in this Section 3.2(a)(vi) shall be taken to relieve the
Capital Securities Guarantee Trustee, upon the occurrence of an
Event of Default, of its obligation to exercise the rights and
powers vested in it by this Series B Capital Securities Guarantee;
(vii) The Capital Securities Guarantee Trustee shall not be
bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the
Capital Securities Guarantee Trustee, in its discretion, may make
such further inquiry or investigation into such facts or matters as
it may see fit;
(viii) The Capital Securities Guarantee Trustee may execute
any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, nominees,
custodians or attorneys, and the Capital Securities Guarantee
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;
(ix) Any action taken by the Capital Securities Guarantee
Trustee or its agents hereunder shall bind the Holders of the Series
B Capital Securities, and the signature of the Capital Securities
Guarantee Trustee or its agents alone shall be sufficient and
effective to perform any such action; and no third party shall be
required to inquire as to the authority of the Capital Securities
Guarantee Trustee to so act or as to its compliance with any of the
terms and provisions of this Series B Capital Securities Guarantee,
both of which shall be conclusively evidenced by the Capital
Securities Guarantee Trustee's or its agent's taking such action;
(x) Whenever in the administration of this Series B Capital
Securities Guarantee the Capital Securities Guarantee Trustee shall
deem it desirable to
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receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Capital Securities
Guarantee Trustee (i) may request instructions from the Holders of a
Majority in liquidation amount of the Series B Capital Securities,
(ii) may refrain from enforcing such remedy or right or taking such
other action until such instructions are received, and (iii) shall
be protected in conclusively relying on or acting in accordance with
such instructions; and
(xi) The Capital Securities Guarantee Trustee shall not be
liable for any action taken, suffered, or omitted to be taken by it
in good faith, without negligence, and reasonably believed by it to
be authorized or within the discretion or rights or powers conferred
upon it by this Series B Capital Securities Guarantee.
(b) No provision of this Series B Capital Securities Guarantee
shall be deemed to impose any duty or obligation on the Capital Securities
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 Capital Securities Guarantee Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Capital Securities Guarantee
Trustee shall be construed to be a duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Series B Capital
Securities Guarantee
The recitals contained in this Series B Capital Securities Guarantee
shall be taken as the statements of the Guarantor, and the Capital Securities
Guarantee Trustee does not assume any responsibility for their correctness. The
Capital Securities Guarantee Trustee makes no representation as to the validity
or sufficiency of this Series B Capital Securities Guarantee.
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility
(a) There shall at all times be a Capital Securities Guarantee
Trustee that shall:
(i) not be an Affiliate of the Guarantor; and
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(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory
thereof or of the District of Columbia, or a corporation or Person
permitted by the Securities and Exchange Commission to act as an
indenture trustee under the Trust Indenture Act, authorized under
such laws to exercise corporate trust powers, having a combined
capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by Federal,
State, Territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of
this Section 4.1(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus
as set forth in its most recent report of condition so published.
(b) If at any time the Capital Securities Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the Capital
Securities Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).
(c) If the Capital Securities Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Capital Securities Guarantee Trustee and Guarantor
shall in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Capital Securities Guarantee
Trustee
(a) Subject to Section 4.2(b), the Capital Securities
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.
(b) The Capital Securities Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Capital Securities Guarantee
Trustee and delivered to the Guarantor.
(c) The Capital Securities Guarantee Trustee shall hold office
until a Successor Capital Securities Guarantee Trustee shall have been appointed
or until its removal or resignation. The Capital Securities Guarantee Trustee
may resign from office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Capital Securities Guarantee Trustee and
delivered to the Guarantor, which resignation shall not take effect until a
Successor Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Capital Securities Guarantee Trustee and delivered to the Guarantor and the
resigning Capital Securities Guarantee Trustee.
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(d) If no Successor Capital Securities Guarantee Trustee shall
have been appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery of an instrument of removal or resignation, the
Capital Securities Guarantee Trustee resigning or being removed may petition any
court of competent jurisdiction for appointment of a Successor Capital
Securities Guarantee Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Capital Securities
Guarantee Trustee.
(e) No Capital Securities Guarantee Trustee shall be liable
for the acts or omissions to act of any Successor Capital Securities Guarantee
Trustee.
(f) Upon termination of this Series B Capital Securities
Guarantee or removal or resignation of the Capital Securities Guarantee Trustee
pursuant to this Section 4.2, the Guarantor shall pay to the Capital Securities
Guarantee Trustee all amounts due to the Capital Securities Guarantee Trustee
accrued to the date of such termination, removal or resignation.
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand
The Guarantor hereby waives notice of acceptance of this
Series B Capital Securities Guarantee and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a proceeding
first against the Issuer or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.
SECTION 5.3 Obligations Not Affected
The obligations, covenants, agreements and duties of the
Guarantor under this Series B Capital Securities Guarantee shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:
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(a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Series B Capital
Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Series B Capital Securities or
the extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Series B Capital Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the commencement of an
Extended Interest Payment Period (as defined in the Indenture) on the Debentures
permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Holders pursuant to the terms of the Series B Capital
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the Issuer or any of the
assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Series
B Capital Securities;
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred;
(g) the consummation of the Exchange Offer (subject to Section
7.1 hereof); or
(h) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor;
it being the intent of this Section 5.3 that the obligations of the Guarantor
with respect to the Guarantee Payments shall be absolute and unconditional under
any and all circumstances.
There shall be no obligation of the Holders to give notice to,
or obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
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SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of the
Series B Capital Securities have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Capital Securities
Guarantee Trustee in respect of this Series B Capital Securities Guarantee or
exercising any trust or power conferred upon the Capital Securities Guarantee
Trustee under this Series B Capital Securities Guarantee.
(b) If the Capital Securities Guarantee Trustee fails to
enforce this Series B Capital Securities Guarantee, any Holder of Series B
Capital Securities may institute a legal proceeding directly against the
Guarantor to enforce the Capital Securities Guarantee Trustee's rights under
this Series B Capital Securities Guarantee, without first instituting a legal
proceeding against the Issuer, the Capital Securities Guarantee Trustee or any
other person or entity. The Guarantor waives any right or remedy to require that
any action be brought first against the Issuer or any other person or entity
before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment
This Series B Capital Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any) rights of
the Holders of Series A Capital Securities against the Issuer in respect of any
amounts paid to such Holders by the Guarantor under this Series B Capital
Securities Guarantee; provided, however, that the Guarantor shall not (except to
the extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Series B Capital Securities Guarantee, if, at the time of any such payment, any
amounts are due and unpaid under this Series B Capital Securities Guarantee. If
any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Holders.
SECTION 5.7 Independent Obligations
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Series B
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 Series
B Capital Securities Guarantee notwithstanding the occurrence of any event
referred to in subsections (a) through (h), inclusive, of Section 5.3 hereof.
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ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Capital Securities remain outstanding, the
Guarantor shall not (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire, or make a liquidation payment with respect to, any of
the Guarantor's capital stock, (ii) make any payment of principal of or interest
or premium, if any, on or repay, repurchase or redeem any debt securities of the
Guarantor (including Other Debentures) that rank pari passu with or junior in
right of payment to the Debentures or (iii) make any guarantee payments with
respect to any guarantee by the Guarantor of the debt securities of any
subsidiary of the Guarantor (including Other Guarantees) if such guarantee ranks
pari passu with or junior in right of payment to the Debentures (other than (a)
dividends or distributions in shares of, or options, warrants, rights to
subscribe for or purchase shares of, common stock of the Guarantor, (b) any
declaration of a dividend in connection with the implementation of a
shareholders' rights plan, or the issuance of stock under any such plan in the
future, or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under this Series B Capital Securities Guarantee and the Series A
Capital Securities Guarantee, (d) as a result of a reclassification of the
Guarantor's capital stock or the exchange or the conversion of one class or
series of the Guarantor's capital stock for another class or series of the
Guarantor's capital stock, (e) the purchase of fractional interests in shares of
the Guarantor's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged, and (f)
purchases of common stock related to the issuance of common stock or rights
under any of the Guarantor's benefit or compensation plans for its directors,
officers or employees or any of the Guarantor's dividend reinvestment plans) if
at such time (1) there shall have occurred any event of which the Guarantor has
actual knowledge that (A) is, or with the giving of notice or the lapse of time,
or both, would be, an Event of Default and (B) in respect of which the Guarantor
shall not have taken reasonable steps to cure, (2) if such Debentures are held
by the Property Trustee, the Guarantor shall be in default with respect to its
payment of any obligations under this Series B Capital Securities Guarantee or
(3) the Guarantor shall have given notice of its election of the exercise of its
right to commence an Extended Interest Payment Period as provided in the
Indenture and shall not have rescinded such notice, and such Extended Interest
Payment Period, or an extension thereof, shall have commenced and be continuing.
SECTION 6.2 Ranking
This Series B Capital Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to Senior Indebtedness (as defined in the Indenture), to the
same extent and in the same manner that the Debentures are subordinated to
Senior Indebtedness pursuant to the Indenture, it being understood that the
terms of Article XV of the Indenture shall apply to the obligations of the
Guarantor under this Series B Capital Securities Guarantee as if such Article XV
were set
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forth herein in full and (ii) pari passu with the most senior preferred or
preference stock now or hereafter issued by the Guarantor and with any Other
Guarantee and, except to the extent set forth therein, the Common Securities
Guarantee and any Other Common Securities Guarantee, and any guarantee now or
hereafter entered into by the Guarantor in respect of any preferred or
preference stock of any Affiliate of the Guarantor, and (iii) senior to the
Guarantor's common stock.
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Series B Capital Securities Guarantee shall terminate and
be of no further force and effect upon (i) full payment of the Redemption Price
of all Series B Capital Securities or (ii) upon liquidation of the Issuer, the
full payment of the amounts payable in accordance with the Declaration or the
distribution of the Debentures to the Holders of all of the Series B Capital
Securities. Notwithstanding the foregoing, this Series B Capital Securities
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder of Series B Capital Securities must restore
payment of any sums paid under the Series B Capital Securities or under this
Series B Capital Securities Guarantee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith in accordance with this Series
B Capital Securities Guarantee and in a manner that such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by this Series B Capital Securities Guarantee or by law,
except that an Indemnified Person shall be liable for any such loss, damage or
claim incurred by reason of such Indemnified Person's negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as to
matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
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liabilities, profits, losses, or any other facts pertinent to the existence and
amount of assets from which Distributions to Holders of Series B Capital
Securities might properly be paid.
SECTION 8.2 Compensation and Indemnification
The Guarantor agrees to pay to the Capital Securities
Guarantee Trustee such compensation for its services as shall be mutually agreed
upon by the Guarantor and the Capital Securities Guarantee Trustee. The
Guarantor shall reimburse the Capital Securities Guarantee Trustee upon request
for all reasonable out-of-pocket expenses incurred by it, including the
reasonable compensation and expenses of the Capital Securities Guarantee
Trustee's agents and counsel, except any expense as may be attributable to the
negligence or bad faith of the Capital Securities Guarantee Trustee.
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against, any and all loss,
liability, damage, claim or expense incurred without negligence or bad faith on
its part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The provisions of this
Section 8.2 shall survive the termination of this Series B Capital Securities
Guarantee or the resignation or removal of the Capital Securities Guarantee
Trustee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Series B
Capital Securities Guarantee shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders of the Series B Capital Securities then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not materially
adversely affect the rights of Holders (in which case no consent of Holders will
be required), this Series B Capital Securities Guarantee may only be amended
with the prior approval of the Holders of a Majority in liquidation amount of
the Securities (including the amount that would be paid on redemption,
liquidation or otherwise, plus accumulated and unpaid Distributions to the date
upon which the voting percentages are determined). The provisions of Section
12.2 of the Declaration with respect to meetings of Holders of the Securities
apply to the giving of such approval.
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SECTION 9.3 Notices
All notices provided for in this Series B Capital Securities
Guarantee shall be in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Issuer, in care of the Administrative
Trustee at the Issuer's mailing address set forth below (or such other address
as the Issuer may give notice of to the Capital Securities Guarantee Trustee and
the Holders of the Series B Capital Securities):
Banknorth Capital Trust I
c/o Banknorth Group, Inc.
300 Financial Plaza
Burlington, Vermont 05401
Attention: Neal E. Robinson
Telecopy: (802) 860-5437
(b) If given to the Capital Securities Guarantee Trustee, at
the Capital Securities Guarantee Trustee's mailing address set forth below (or
such other address as the Capital Securities Guarantee Trustee may give notice
of to the Holders of the Series B Capital Securities):
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670
Attention: Corporate Trust Administration
Telecopy: (312) 407-1908
(c) If given to the Guarantor, at the Guarantor's mailing
address set forth below (or such other address as the Guarantor may give notice
of to the Capital Securities Guarantee Trustee and the Holders of the Series B
Capital Securities):
Banknorth Group, Inc.
300 Financial Plaza
Burlington, Vermont 05401
Attention: Neal E. Robinson
Telecopy: (802) 860-5437
(d) If given to any Holder of Series B Capital Securities, at
the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid
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<PAGE>
except that if a notice or other document is refused delivery or cannot be
delivered because of a changed address of which no notice was given, such notice
or other document shall be deemed to have been delivered on the date of such
refusal or inability to deliver.
SECTION 9.4 Benefit
This Series B Capital Securities Guarantee is solely for the
benefit of the Holders of the Series B Capital Securities and, subject to
Section 3.1(a), is not separately transferable from the Series B Capital
Securities.
SECTION 9.5 Governing Law
THIS SERIES B CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.
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<PAGE>
THIS SERIES B CAPITAL SECURITIES GUARANTEE is executed as of
the day and year first above written.
BANKNORTH GROUP, INC.,
as Guarantor
By:
--------------------------------
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO,
as Capital Securities Guarantee Trustee
By:
--------------------------------
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT 4.8
REGISTRATION RIGHTS AGREEMENT
Dated as of May 1, 1997
among
BANKNORTH GROUP, INC.
BANKNORTH CAPITAL TRUST I
and
SANDLER O'NEILL & PARTNERS, L.P.
as Initial Purchaser
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<PAGE>
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
and entered into as of May 1, 1997 among BANKNORTH GROUP, INC., a Delaware
corporation (the "Company"), BANKNORTH CAPITAL TRUST I, a business trust formed
under the laws of the state of Delaware (the "Trust"), and SANDLER O'NEILL &
PARTNERS, L.P. (the "Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement
dated April 28, 1997 (the "Purchase Agreement"), among the Company, as issuer of
the 10.52% Junior Subordinated Deferrable Interest Debentures due May 1, 2027
Series A, (the "Subordinated Debentures"), the Trust and the Initial Purchaser,
which provides for, among other things, the sale by the Trust to the Initial
Purchaser of 30,000 of the Trust's 10.52% Capital Securities, Series A,
liquidation amount $1,000 per Capital Security (the "Capital Securities"), the
proceeds of which will be used by the Trust, together with the proceeds from the
sale of the Trust's Common Securities to the Company, to purchase Subordinated
Debentures. The Capital Securities, together with the Subordinated Debentures
and the Company's guarantee agreement in respect of the Capital Securities (the
"Capital Securities 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 Trust have agreed to provide to the
Initial Purchaser and their 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:
"Additional Distributions" shall have the meaning set forth
in Section 2(e) hereof.
"Advice" shall have the meaning set forth in the last paragraph of
Section 3 hereof.
"Affiliate" has the same meaning as given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
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<PAGE>
"Applicable Period" shall have the meaning set forth in
Section 3(u) hereof.
"Business Day" means any day other than a Saturday, a Sunday, or a day
on which banking institutions in New York, New York or Burlington, Vermont are
authorized or required by law or executive order to remain closed.
"Closing Time" shall mean the Closing Time as defined in the
Purchase Agreement.
"Company" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
"Declaration" or "Declaration of Trust" shall mean the Amended and
Restated Declaration of Trust of Banknorth Capital Trust I, dated as of the
Closing Time, by the trustees named therein and the Company as sponsor.
"Debentures" shall collectively mean the Subordinated
Debentures and the Exchange Debentures.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the 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 Trust to
the Holders to exchange all of the Registrable Securities (other than Private
Exchange Securities) for a like 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 documents incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in
Section 2(a) hereof.
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<PAGE>
"Exchange Securities" shall mean (i) with respect to the Subordinated
Debentures, the 10.52% Junior Subordinated Deferrable Interest Debentures due
May 1, 2027, Series B (the "Exchange Debentures") containing terms substantially
identical to the Subordinated Debentures (except that they will not contain
terms with respect to the transfer restrictions under the Securities Act (other
than requiring minimum transfers thereof to be in blocks of $100,000 aggregate
principal amount) and will not provide for any Liquidated Damages thereon), (ii)
with respect to the Capital Securities, the Trust's 10.52% Capital Securities,
Series B, liquidation amount $1,000 per Capital Security (the "Exchange Capital
Securities") containing terms substantially identical to the Capital Securities
(except they will not contain terms with respect to transfer restrictions under
the Securities Act (other than requiring minimum transfers thereof to be in
blocks of $100,000 aggregate liquidation amount) and will not provide for any
increase in Additional Distributions thereon) and (iii) with respect to the
Capital Securities Guarantee, the Company's guarantee agreement in respect of
the Exchange Capital Securities (the "Exchange Capital Securities Guarantee")
containing terms substantially identical to the Capital Securities Guarantee.
"Holder" shall mean the Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its respective successors, assigns and
direct and indirect transferees who become registered owners of Registrable
Securities under the Indenture or Declaration of Trust.
"Indenture" shall mean the Indenture relating to the Subordinated
Debentures and the Exchange Debentures, dated as of the Closing Time, between
the Company, as issuer, and The First National Bank of Chicago, 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 Sec-
tion 3(o) hereof.
"Issue Date" shall mean May 1, 1997, 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 and Exchange
Capital Securities.
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<PAGE>
"Participating Broker-Dealer" shall have the meaning set
forth in Section 3(u) hereof.
"Person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability corporation, 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 Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all documents 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(o)
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
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 are eligible to be sold without
restriction as contemplated by Rule 144(k), (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 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
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<PAGE>
Agreement, including without limitation: (i) all SEC 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 one counsel for
all underwriters or Holders as a group 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 any
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 the
performance of and compliance with this Agreement, (vi) the reasonable fees and
expenses of the Trustees and their counsel and any exchange agent or custodian,
and (vii) the reasonable fees and expenses of any special experts retained by
the Company in connection with any Registration Statement.
"Registration Statement" shall mean any registration statement of the
Company and the 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 documents 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.
"SEC" shall mean the Securities and Exchange Commission.
"Securities" shall have the meaning set forth in the pream-
ble 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.
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<PAGE>
"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 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 SEC, 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 documents incorporated by
reference therein.
"TIA" shall have the meaning set forth in Section 3(l)
hereof.
"Trustees" shall mean any and all trustees under the Declaration, the
Indenture, the Capital Securities Guarantee or the Exchange Capital Securities
Guarantee.
2. Registration Under the Securities Act.
(a) Exchange Offer. Except as set forth in Section 2(b) below,
the Company and the Trust shall, for the benefit of the Holders, at the
Company's cost, use commercially reasonable efforts to (i) cause to be filed
with the SEC within 150 days after the Issue Date an Exchange Offer Registration
Statement on an appropriate form under the Securities Act relating to the
Exchange Offer, (ii) cause such Exchange Offer Registration Statement to be
declared effective under the Securities Act by the SEC 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 calendar days (or longer
if required by applicable law) after the date notice of the Exchange Offer is
mailed to the Holders. Promptly after the effectiveness of the Exchange Offer
Registration Statement, the Company and the Trust shall commence the Exchange
Offer, it being the objective of such Exchange Offer to enable each Holder
eligible and electing to exchange Registrable Securities for a like principal
amount of Exchange Debentures or a like liquidation amount of Exchange Capital
Securities, together with the Exchange Guarantee, as applicable (provided that
such Holder (i) is not an Affiliate of the Trust or the Company, (ii) is not a
broker-dealer tendering Registrable Securities acquired directly from the Trust
or the Company, (iii) acquires the Exchange Securities in the ordinary course of
such Holder's business and (iv) has no arrangements or understandings with any
Person to participate in the Exchange Offer for the purpose of distributing the
Exchange Securities),
8
<PAGE>
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 (other than requiring minimum transfers in blocks having an
aggregate principal or liquidation amount, as the case may be, of $100,000).
In connection with the Exchange Offer, the Company and the
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
with respect to Capital Securities represented by a global certificate;
(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 to
Holders, a telegram, telex, facsimile transmission or letter setting forth the
name of such Holder, the 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 placement, as soon as practicable upon receipt by the
Company and the Trust of a written request from such Initial Purchaser, the
Company and the Trust, as applicable, shall issue and deliver to the Initial
Purchaser in exchange (the "Private Exchange") for the Securities held by the
Initial Purchaser a like liquidation amount of Exchange Capital Securities of
the Trust or, in the event the Trust is liquidated and Subordinated Debentures
are
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<PAGE>
distributed, a like principal amount of the Exchange Debentures of the Company,
together with the Exchange Capital Securities Guarantee, in each case 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 or the Declaration (which provides that the Exchange Securities
will not be subject to the transfer restrictions set forth in the Indenture or
the Declaration, as applicable (other than requiring minimum transfers in blocks
having an aggregate principal or liquidation amount, as the case may be, of
$100,000), 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 none of the Exchange Securities, the Private Exchange Securities or 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 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 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 the Trust; and
(iii) issue, and cause the applicable Trustee under the Indenture or
the Declaration, 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 Subordinated Debentures
or equal in liquidation amount to the liquidation amount of the Capital
Securities as are surrendered by such Holder, and will execute, and cause the
applicable Trustee to execute, the Exchange Capital Securities Guarantee.
Distributions on each Exchange Capital Security and interest
on each Exchange Debenture and Private Exchange Security issued pursuant to the
Exchange Offer and in the Private Exchange will accrue from the last date on
which a Distribution or interest was paid on the Capital Security or the
Subordinated Debenture surrendered in exchange therefor or, if no Distribution
or interest has been paid on such Capital Security or Subordinated Debenture,
from the Issue Date. To the extent not prohibited by
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any law or applicable interpretation of the staff of the SEC, the Company and
the Trust shall use commercially reasonable 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 the conditions referred to in Section 2(b)(i) and (ii)
below and those conditions that are customary in similar exchange offers. 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 Trust or the Company, (ii) it is not a broker-dealer
tendering Registrable Securities acquired directly from the Trust or Company,
(iii) the Exchange Securities to be received by it were acquired in the ordinary
course of its business and (iv) at the time of the Exchange Offer, it has no
arrangements or understandings with any Person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Capital
Securities. The Company and the Trust shall inform the Initial Purchaser, after
consultation with the applicable Trustees, 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 in order to 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 Trust shall have no further obligation
to register the Registrable Securities (other than Private Exchange Securities)
held by any Holder pursuant to Section 2(b) of this Agreement.
(b) Shelf Registration. In the event that (i) the Company or
the Trust reasonably determine, after conferring with counsel (which may be
in-house counsel), that the Exchange Offer Registration provided in Section 2(a)
above is not available under applicable law and regulations and currently
prevailing interpretations of the staff of the SEC, (ii) the Company shall
determine in good faith that there is a reasonable likelihood that, or a
material uncertainty exists as to whether, consummation of the Exchange Offer
would result in (x) the Trust becoming subject to federal income tax with
respect to income received or accrued on the Debentures, (y) the interest
payable by the Company on the Debentures not being deductible by the Company for
United States federal income tax purposes or (z) the Trust becoming subject to
more that a DE MINIMIS amount of other taxes,
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duties or governmental charges, (iii) the Exchange Offer Registration Statement
is not declared effective within 180 days of the Issue Date or (iv) upon the
request of the Initial Purchaser with respect to any Registrable Securities held
by it, if such Initial Purchaser is not permitted, in the reasonable opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, pursuant to applicable law or
applicable interpretations of the staff of the SEC, to participate in the
Exchange Offer and thereby receive securities that are freely tradeable without
restriction under the Securities Act and applicable blue sky or state securities
laws (any of the events specified in (i), (ii), (iii) or (iv) being a "Shelf
Registration Event", and the date of occurrence thereof, the "Shelf Registration
Event Date"), then in addition to or in lieu of conducting the Exchange Offer
contemplated by Section 2(a), as the case may be, the Company and the Trust
shall, at their cost, use commercially reasonable efforts to cause to be filed
as promptly as practicable after such Shelf Registration Event Date, as the case
may be, and, in any event, within 45 days after such Shelf Registration Event
Date (provided that in no event shall such filing date be required to be earlier
than 90 days after the Issue Date), a Shelf Registration Statement providing for
the sale by the Holders of all of the Registrable Securities, and shall use
commercially reasonable efforts to have such Shelf Registration Statement
declared effective by the SEC 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 Trust in writing,
within 15 days after receipt of a request therefor, such information as the
Company and the Trust may, after conferring with counsel with regard to
information relating to Holders that would be required by the SEC to be included
in such Shelf Registration Statement or Prospectus included therein, reasonably
request for inclusion in any 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 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 Trust agree to use commercially reasonable
efforts to keep the Shelf Registration Statement continuously effective and
usable for resales for (a) the Rule 144(k) Period in the case of a Shelf
Registration Statement filed pursuant to Section 2(b)(i), (ii) or (iii) or (b)
270 days in the case of a Shelf Registration Statement filed pursuant to Section
2(b)(iv) (subject in each case to extension pursuant to the last paragraph of
Section 3 hereof), or for such shorter period which will terminate when all of
the Securities covered by the Shelf Registration Statement have been sold
pursuant to the Shelf
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Registration Statement or cease to be Registrable Securities (the "Effectiveness
Period"). The Company and the Trust shall not permit any securities other than
Registrable Securities to be included in the Shelf Registration. The Company and
the 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 take certain other
actions as are required to permit certain unrestricted resales of the Registra-
ble Securities. The Company and the 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 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 SEC.
(c) Expenses. The Company, as issuer of the Subordinated
Debentures, shall pay all Registration Expenses in connection with any
Registration Statement filed pursuant to Section 2(a) and/or 2(b) hereof and
will reimburse the Initial Purchaser for the reasonable fees and disbursements
of Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Initial Purchaser,
incurred in connection with the Exchange Offer and, if applicable, the Private
Exchange, and either Skadden, Arps, Slate, Meagher & Flom LLP or any other
single 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) hereof will not be deemed to have become
effective unless it has been declared effective by the SEC; provided, however,
that if, after it has been declared effective, the offering of Registrable
Securities pursuant to such Exchange Offer Registration Statement or Shelf
Registration Statement is interfered with by any stop order, injunction or other
order or requirement of the SEC or any other governmental agency or court, such
Exchange Offer Registration Statement or Shelf 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
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Trust will be deemed not to have used commercially reasonable 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 any
such Registration Statement not being declared effective or that would result 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) Liquidated Damages and Additional Distributions.
In the event that:
(i) neither the Exchange Offer Registration
Statement is filed with the SEC on or prior to the 150th day after the Issue
Date nor a Shelf Registration Statement is filed with the SEC on or prior to the
45th day after the Shelf Registration Event Date in respect of a Shelf
Registration Event attributable to any of the events set forth in Sections
2(b)(i), (ii) and (iii) (provided that in no event shall such filing date be
required to be earlier than 90 days after the Issue Date), then commencing on
the day after the applicable required filing date, liquidated damages
("Liquidated Damages") shall accrue on the principal amount of the Subordinated
Debentures, and additional distributions ("Additional Distributions") shall
accumulate on the liquidation amount of the Trust Securities (as such term is
defined in the Declaration), each at a rate of .25% per annum; or
(ii) neither the Exchange Offer Registration
Statement is declared effective by the SEC on or prior to the 180th day after
the Issue Date nor a Shelf Registration Statement is declared effective by the
SEC on or prior to the later of (A) the 40th day after the date such Shelf
Registration Statement was required to be filed and (B) the 180th day after the
Issue Date, in respect of a Shelf Registration Event attributable to any of the
events set forth in Sections 2(b)(i), (ii) and (iii)), then, commencing on the
day after the applicable required effectiveness date, Liquidated Damages shall
accrue on the principal amount of the Subordinated Debentures, and Additional
Distributions shall accumulate on the liquidation amount of the Trust
Securities, each at a rate of .25% per annum;
(iii) (A) the Trust has not exchanged Exchange
Capital Securities for all Capital Securities or the Company has not exchanged
Exchange Debentures for all Subordinated Debentures, validly tendered, or
executed the Exchange Capital Securities Guarantee in respect of the Exchange
Capital Securities, in accordance with the terms of the Exchange Offer on or
prior to the 45th day after the date on which the Exchange Offer Registration
Statement was declared effective or (B) if applicable, the
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Shelf Registration Statement in respect of Shelf Registration Event attributable
to any of the events set forth in Sections 2(b)(i), (ii) and (iii) has been
declared effective and such Shelf Registration Statement ceases to be effective
or usable for resales (whether as a result of an event contemplated by Section
3(e) or otherwise) at any time prior to the expiration of the Rule 144(k) Period
(other than after such time as all Securities have been disposed of thereunder
or otherwise cease to be Registered Securities), then Liquidated Damages shall
accrue on the principal amount of Subordinated Debentures, and Additional
Distributions shall accumulate on the liquidation amount of the Trust
Securities, each at a rate of .25% per annum commencing on (x) the 46th day
after such effective date, in the case of (A) above, or (y) the day such Shelf
Registration Statement ceases to be effective or usable for resales, in the case
of (B) above;
provided, however, that neither the Liquidated Damages rate on the Subordinated
Debentures, nor the Additional Distribution rate on the liquidation amount of
the Trust Securities, may exceed in the aggregate .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 Exchange Capital Securities and Exchange Debentures for all Capital
Securities and Subordinated Debentures validly tendered and execution of the
Exchange Capital Securities Guarantee (in the case of clause (iii)(A) above), or
at such time as the Shelf Registration Statement which had ceased to remain
effective or usable for resales again becomes effective and usable for resales
(in the case of clause (iii)(B) above), Liquidated Damages on the principal
amount of the Subordinated Debentures, and Additional Distributions on the
liquidation amount of the Trust Securities, as a result of such clause (or the
relevant subclause thereof) shall cease to accrue and accumulate, as the case
may be.
Any amounts of Liquidated Damages and Additional Distributions due
pursuant to Section 2(e)(i), (ii) or (iii) above will be payable in cash on the
next succeeding May 1 and November 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 Declaration, respectively.
(f) Specific Enforcement. Without limiting the remedies
available to the Holders, the Company and the Trust acknowledge that any failure
by the Company or the 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
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such relief as may be required to specifically enforce the Company's and the
Trust's obligations under Section 2(a) and Section 2(b) hereof.
(g) Distribution of Subordinated Debentures. Notwithstanding
any other provisions of this Agreement, in the event that Subordinated
Debentures are distributed to holders of Capital Securities in liquidation of
the Trust pursuant to the Declaration, (i) all references in this Section 2 and
in Section 3 to Securities, Registrable Securities and Exchange Securities shall
not include the Capital Securities and Capital Securities Guarantee, or the
Exchange Capital Securities and Exchange Capital Securities Guarantee issued or
to be issued in exchange therefor in the Exchange Offer and (ii) all
requirements for any action to be taken by the Trust in this Section 2 and in
Section 3 shall cease to apply and all requirements for any action to be taken
by the Company in this Section 2 and in Section 3 shall apply to the
Subordinated Debentures and Exchange Debentures issued or to be issued in
exchange therefor in the Exchange Offer.
3. Registration Procedures. In connection with the
obligations of the Company and the Trust with respect to the
Registration Statements pursuant to Sections 2(a) and 2(b)
hereof, the Company and the Trust shall:
(a) prepare and file with the SEC 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 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 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 SEC to be filed therewith; and use
commercially reasonable efforts to cause such Registration Statement to
become effective and remain effective (and, in the case of a Shelf
Registration Statement, usable for resales) 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 Trust shall furnish to and afford the Holders of the
Registrable Securities and each such Participating Broker-Dealer, as
the case may be,
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<PAGE>
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 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 in a timely manner;
(b) prepare and file with the SEC 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 Trust or requested by the SEC, 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
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<PAGE>
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 SEC 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 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;
(e) (1) in the case of a Shelf Registration or (2) if
Participating Broker-Dealers from whom the Company or the 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(u) hereof, are seeking to sell Exchange
Securities and are required to deliver Prospectuses, promptly notify
each Holder of Registrable Securities, or such Participating
Broker-Dealers, as the case may be, their counsel and the managing
underwriters, if any, and promptly confirm such notice in writing (i)
when a Registration Statement has become effective and when any
post-effective amendments thereto become effective, (ii) of any request
by the SEC or any state securities authority for amendments and
supplements to a Registration Statement or Prospectus or for additional
information after the Registration Statement has become effective,
(iii) of the issuance by the SEC 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 any 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, the representations and warranties of the Company and the
Trust contained in any purchase agreement,
18
<PAGE>
securities sales agreement or other similar agreement 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 development or the
discovery of any facts or otherwise, during the Effectiveness Period,
which makes, or may make, 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 in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, and (vi) the Company and the 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
Shelf 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 (other
than with respect to restrictions requiring minimum transfers in blocks
having an aggregate principal or liquidation amount, as the case may
be, of $100,000) and in such denominations (consistent with the
provisions of the Indenture and the Declaration) 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, as soon as practicable after the resolution of the
matters contemplated by Section 3(e)(ii), 3(e)(iii), 3(e)(v) or
3(e)(vi) hereof, 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 include any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light
19
<PAGE>
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, and each Holder
hereby agrees to suspend use of the Prospectus until the Company has
amended or supplemented the Prospectus to correct such misstatement or
omission; provided, however, that where such suspension of use of the
Prospectus is caused by a potential acquisition or divestiture, such
suspension period shall not exceed 21 days, absent the consent of the
Initial Purchaser;
(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 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 Exchange Capital Securities
and the Capital Securities (and, if the Trust has made a distribution
of the Subordinated Debentures to the Holders of the Capital
Securities, the Subordinated Debentures or the Exchange Debentures), as
the case may be, not later than the effective date of a Registration
Statement, and provide the applicable Trustee with certificates for the
Exchange Securities or the Registrable Securities, as the case may be,
in a form eligible for deposit with the Depositary;
(l) cause the Indenture, the Declaration, the Capital
Securities Guarantee (in the case of a Shelf Registration) and the
Exchange Capital Securities Guarantee (in the case of an Exchange Offer
Registration) to be qualified under the Trust Indenture Act of 1939, as
amended (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 applicable 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 SEC 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 in
connection therewith as are reason-
20
<PAGE>
ably requested by the Holders of at least 25% in aggregate principal or
liquidation amount, as the case may be, of the Registrable Securities
in order to expedite or facilitate the registration or the disposition
or the Registrable Securities;
(n) in the case of a Shelf Registration, 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 the Initial Purchaser holds
Securities acquired by it as part of its initial placement and (y)
Holders of at least 25% in aggregate principal or liquidation amount,
as the case may be, of the Registrable 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 Trust, the Company and its subsidiaries as then conducted and
the 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 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 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 opinion 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 Trust (and, if necessary, any other independent
certified public accountants of any business acquired by the Company
and the Trust for which financial statements and financial data are, or
are required to be, included in the 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 or liquidation amount, as
the case may
21
<PAGE>
be, of Registrable Securities covered by such Registration Statement
and the managing underwriters) customary for such agreements with
respect to all parties to be indemnified pursuant to said Section
(including, without limitation, such underwriters and selling Holders);
and in the case of an underwritten registration, the above requirements
shall be satisfied at each closing under the related underwriting
agreement, or as and to the extent required thereunder;
(o) 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 or Regis-
trable Securities or Participating Broker-Dealer, as applicable, who
certifies to the Company and the Trust that it has a current intention
to sell Registrable Securities pursuant to the Shelf Registration, any
underwriter participating in any such disposition of Registrable
Securities, if any, and any attorney, accountant or other agent
retained by any such selling Holder, Participating Broker-Dealer, as
the case may be, or underwriter (collectively, the "Inspectors"), at
the offices where normally kept, during the Company's normal business
hours, all financial and other records, pertinent corporate documents
and properties of the 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 Trust, the
Company and its subsidiaries to supply all relevant information in each
case reasonably requested by any such Inspector in connection with such
Registration Statement. Records and information which the Company and
the Trust determine, in good faith, to be confidential and any Records
and information which it notifies the Inspectors are confidential shall
not be disclosed to any Inspector except where (i) the disclosure of
such Records or information is necessary to avoid or correct a material
misstatement or omission in such Registration Statement, (ii) the
release of such Records or information 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)
such Records or information previously 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 Records and 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 Trust or the Company unless and until such
22
<PAGE>
is made generally available to the public through no fault of an
Inspector or a selling Holder. 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 or information is sought in a court of competent
jurisdiction, or in connection with any action, suit or proceeding,
give notice to the Company and allow the Company at its expense to
undertake appropriate action to prevent disclosure of the Records and
information deemed confidential;
(p) comply with all applicable rules and regulations of the
SEC so long as any provision of this Agreement shall be applicable and
make generally available to its securityholders 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, provided that the obligations under this paragraph (p) shall
be satisfied by the timely filing of quarterly and annual reports on
Forms 10-Q and 10-K under the Exchange Act;
(q) 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, substantially to the effect that
(i) each of the Company and the Trust, as the case requires, has duly
authorized, executed and delivered the Exchange Securities and Private
Exchange Securities, and (ii) each of the Exchange Securities or the
Private Exchange Securities, as the case may be, constitutes a validly
issued, fully paid and nonassessable undivided beneficial ownership
interest in the assets of the Trust (in the case of an Exchange Capital
Security) or a legal, valid and binding obligation of the Company,
enforceable against the Company, in accordance with its respective
terms (in the case of an Exchange Debenture and the Exchange Capital
Securities Guarantee), as the case may be (in each case, with customary
exceptions);
(r) if an Exchange Offer or a Private Exchange is to
be consummated, upon delivery of the Registrable Securities
23
<PAGE>
by Holders to the Company or the Trust, as applicable (or to such other
Person as directed by the Company or the Trust, respectively), in
exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be, the Company or the Trust, as
applicable, shall 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; it being understood
that in no event shall such Registrable Securities be marked as paid or
otherwise satisfied;
(s) 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;
(t) take all other steps necessary to effect the
registration of the Registrable Securities covered by a
Registration Statement contemplated hereby;
(u) (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 SEC with respect to the potential "underwriter" status
of any broker-dealer that holds Registrable Securities acquired for its
own account as a result of market-making activities or other trading
activities (a "Participating Broker-Dealer") 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 by the staff of the SEC 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 SEC,
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
24
<PAGE>
Participating Broker-Dealer may reasonably request (each of the Company
and the 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) use commercially reasonable efforts to keep
the Exchange Offer Registration Statement effective and to 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 Trust agree to deliver to the Initial Purchaser or
to another representative of the Participating Broker-Dealers, if
requested by the Initial Purchaser or such other representative of
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
25
<PAGE>
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 Trust may require each seller of
Registrable Securities as to which any registration is being effected to furnish
to the Company or the Trust, as applicable, such information regarding such
seller as may be required by the staff of the SEC to be included in a
Registration Statement. The Company or the 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 a Shelf Registration Statement, or if
Participating Broker-Dealers who have notified the Company and the Trust that
they will be utilizing the Prospectus contained in the Exchange Offer
Registration Statement as provided in this Section 3(u) hereof, 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 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 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 Trust that the use of the applicable Prospectus
may be resumed, and, if so directed by the Company and the Trust, such Holder
will deliver to the Company or the Trust (at the Company's or the 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 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 Trust shall use commercially reasonable efforts to file and
have declared effective (if an amendment) as soon as practicable after the
resolution of the related matters an amend-
26
<PAGE>
ment or supplement to the Registration Statement and shall extend the period
during which such Registration Statement is required to be maintained effective
and usable for resales 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 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 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 and employees,
as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment or supplement thereto),
covering Registrable Securities or Exchange Securities, as applicable,
or the omission or alleged omission therefrom of a material fact
required to be stated therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that any such settlement is effected with the prior written consent of
the Company and the Trust; and
(iii) 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 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);
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provided, however, that 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
Trust by the Initial Purchaser or such Holder, underwriter or Participating
Broker-Dealer for use in a Registration Statement (or any amendment thereto) or
any Prospectus (or any amendment or supplement thereto).
(b) The Initial Purchaser and each Holder, underwriter or
Participating Broken-Dealer agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors and officers (including each officer of
the Company and the Trust who signed the Registration Statement), the Trust,
each of the Trustees and each Person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act, 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
Trust by 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 claims 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 notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying party from
any liability which it may have under this Section 4 to the extent that it is
not materially prejudiced by such failure as a result thereof, and in any event
shall not relieve it from liability which it may have otherwise on account of
this indemnity agreement. In the case of parties indemnified pursuant to Section
4(a) or (b) above, counsel to the indemnified parties shall be selected by such
parties. An indemnifying party may participate at its own expense in the defense
of such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. 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 their own counsel, for all indemnified parties in connection with
any one action or separate
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<PAGE>
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 or consent (i) includes an unconditional written release
of each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) 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 unenforceable by an indemnified party
although applicable in accordance with its terms, the Company, the 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 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
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 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 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
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 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 and employee and Person,
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<PAGE>
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 the Company, each
Trustee of the Trust and each Person, if any, who controls the Company 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
Trust.
5. Participation in an Underwritten Registration.
No Holder may participate in an underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder's Registrable
Securities on the basis provided in the underwriting arrangement
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 the Shelf Registration Statement who desire to do so may
sell the Securities covered by such Shelf Registration in an underwritten
offering, subject to the provisions of Section 3(m) hereof. 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 or liquidation amount, as applicable, of the Registrable
Securities included in such offering; provided, however, that such underwriters
and managers must be reasonably satisfactory to the Company and the Trust.
7. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company is
subject to the reporting requirements of Section 13 or 15 of the Exchange Act
and any Registrable Securities remain outstanding, the Company will 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 SEC
thereunder, provided that if the Company 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 its
securities pursuant to Rule 144 under the Securities Act, (b) deliver such
information to a prospective purchaser as is necessary to permit sales of its
securities pursuant to Rule 144A under the Securities Act, 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)
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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 SEC.
Upon the request of any Holder of Registrable Securities, the Company 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 Trust has
not entered into, nor will the Company or the 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 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, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company and the Trust have obtained the written
consent of Holders of a majority in aggregate amount of the outstanding
Registrable Securities affected by such amendment, modification, supplement,
waiver or departure; provided that 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 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 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 SEC) 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 Trust.
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<PAGE>
(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 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 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, the
Declaration 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. Each Holder and any Participating
Broker-Dealer shall be a third party beneficiary of the agreements made
hereunder among the Initial Purchaser, the Company and the Trust, and the
Initial Purchaser 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
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<PAGE>
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 NEW YORK. 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 NEW YORK 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 OR ANY OF THE MATTERS CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY
DEFENSE OF LACK OF PERSONAL JURISDICTION AND IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY
SUCH COURT. THE COMPANY, ON BEHALF OF ITSELF AND ITS SUBSIDIARIES (INCLUDING,
WITHOUT LIMITATION, THE TRUST), IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
(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 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 Trust or its Affiliates shall not be counted
in determining whether such consent or approval was given by the Holders of such
required percentage.
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
BANKNORTH GROUP, INC.
By:________________________________
Name:
Title:
BANKNORTH CAPITAL TRUST I
By:________________________________
Name:
Title: Administrative Trustee
Confirmed and accepted as of
the date first above
written:
SANDLER O'NEILL & PARTNERS, L.P.
By: SANDLER O'NEILL & PARTNERS CORP.,
the sole general partner
By:____________________________________
Authorized Signatory
<PAGE>
Exhibit 4.9
LIQUIDATED DAMAGES AGREEMENT
THIS LIQUIDATED DAMAGES AGREEMENT (the "Agreement") is made and
entered into as of May 1, 1997 among BANKNORTH GROUP, INC., a Delaware
corporation (the "Company"), BANKNORTH CAPITAL TRUST I, a business trust formed
under the laws of the state of Delaware (the "Trust"), and SANDLER O'NEILL &
PARTNERS, L.P. ("Sandler O'Neill" or the "Initial Purchaser").
WHEREAS, as an inducement to the Initial Purchaser to enter into the
Purchase Agreement, dated April 28, 1997 (the "Purchase Agreement"), among the
Company, the Trust and the Initial Purchaser (providing for, among other things,
the sale by the Trust to the Initial Purchaser of 30,000 of the Trust's Series A
10.52% Capital Securities, liquidation amount $1,000 per Capital Security (the
"Capital Securities"), the proceeds of which will be used by the Trust to
purchase Series A 10.52% Junior Subordinated Deferrable Interest Debentures due
May 1, 2027 of the Company (the "Subordinated Debentures")), and as a condition
to the several obligations of the Initial Purchaser thereunder, the Company and
the Trust have agreed to provide to the Initial Purchaser and its direct and
indirect transferees certain registration and related rights pursuant to and in
accordance with the terms of the Registration Rights Agreement, of even date
herewith (the "Registration Rights Agreement"), among the Company, the Trust and
the Initial Purchaser; and
WHEREAS, notwithstanding the fact that the Company and the Trust
have consummated or will consummate an Exchange Offer, pursuant to Section 2(b)
of the Registration Rights Agreement, the Initial Purchaser may, under certain
circumstances, require the Company and the Trust to file a Shelf Registration
Statement for the resale of certain Registrable Securities held by it; and
WHEREAS, the Registration Rights Agreement contains certain
provisions concerning the time within which the Company and the Trust must file
the Shelf Registration Statement and the period for which such Shelf
Registration Statement must remain effective and usable for resales; and
WHEREAS, the Company, the Trust and the Initial Purchaser desire to
provide for the payment of liquidated damages by the Company directly to the
Initial Purchaser in the event that the Company and the Trust fail to comply
with such contractual provisions, as more fully set forth herein.
NOW, THEREFORE, in consideration of the foregoing, and for other
good and valuable consideration the receipt of which is hereby acknowledged, the
parties hereto agree as follows:
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i. Definitions. Capitalized terms used herein (including in the
foregoing recitals) but not defined shall have the meanings given to such terms
in the Registration Rights Agreement, except that (a) the term "Shelf
Registration Statement" shall refer only to a Shelf Registration Statement filed
by the Company and the Trust pursuant to Section 2(b) of the Registration Rights
Agreement, and (b) the term "Registrable Securities" shall refer only to those
Registrable Securities held at such time by the Initial Purchaser.
ii. Payment of Liquidated Damages. (a) In the event that (i) the
Shelf Registration Statement is not filed with the SEC on or prior to the 45th
day after a request for such filing is made by the Initial Purchaser (provided
that in no event shall such date be required to be earlier than 90 days after
the Issue Date), or (ii) the Shelf Registration Statement is not declared
effective by the SEC on or prior to the later of the 40th day after the date
such Shelf Registration Statement was required to be filed pursuant to the terms
of the Registration Rights Agreement and the 180th date after the Issue Date, or
(iii) the Shelf Registration Statement has been declared effective and such
Shelf Registration Statement ceases to be continuously effective or usable for
resales (whether as a result of an event contemplated by Section 3(e) of the
Registration Rights Agreement or otherwise) at any time during the 180-day
period (and any extensions of such period pursuant to the last paragraph of
Section 3 of the Registration Rights Agreement) immediately following the date
on which the Shelf Registration Statement is first declared effective (other
than after such time as all Registrable Securities have been disposed of
thereunder or otherwise cease to be Registrable Securities pursuant to the terms
of the Registration Rights Agreement), then in each case the Company shall pay
liquidated damages to the Initial Purchaser, at a rate of .25% per annum in
respect of the aggregate liquidation amount of Capital Securities held by the
Initial Purchaser or, in the event that the Trust is liquidated and Subordinated
Debentures are distributed to holders of Capital Securities, the aggregate
principal amount of Subordinated Debentures held by the Initial Purchaser, as
the case may be, in respect of the period (x) commencing on the 46th day after
such request for the filing of a Shelf Registration Statement is made by the
Initial Purchaser (provided that in no event shall such date be required to be
earlier than 91 days after the Issue Date) and terminating upon the filing of
the Shelf Registration Statement (in the case of clause (i) above), (y)
commencing on the later of the 41st day after the date the Shelf Registration
Statement was required to be filed and the 181st day after the Issue Date and
terminating upon the effectiveness of the Shelf Registration Statement (in the
case of clause (ii) above), or (z) commencing on the day the Shelf Registration
Statement ceases to be effective or usable for resales and terminating at such
time as the Shelf Registration
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Statement again becomes effective and usable for resales (in the case of clause
(iii) above).
(c) Any amounts of liquidated damages payable by the Company
pursuant to this Section 2 shall be paid in cash directly to the Initial
Purchaser on the next succeeding May 1 and November 1, as the case may be,
following the period in respect of which such Liquidated Damages have become due
and payable hereunder.
iii. General.
(a) 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.
(b) Amendments. This Agreement may be amended by the parties hereto
by a written instrument duly executed on behalf of each of the parties hereto.
(c) Entire Agreement. This Agreement and the Registration Rights
Agreement constitutes the entire agreement, and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter hereof.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New
York, without regard to any applicable conflicts of law.
(e) Notices. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered to the parties at the
addresses set forth in, and in a manner contemplated by, the Registration Rights
Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
BANKNORTH GROUP, INC.
By:
---------------------------
Name:
Title:
BANKNORTH CAPITAL TRUST I
By:
---------------------------
Name:
Title: Administrative
Trustee
SANDLER O'NEILL & PARTNERS, L.P.
By: SANDLER O'NEILL
& PARTNERS, CORP.,
the sole general partner
By:
---------------------------
Name:
Title:
EXHIBIT 5.1
September __, 1997
Banknorth Capital Trust I
c/o Banknorth Group, Inc.
300 Financial Plaza
Burlington, Vermont 05401
Re: Banknorth Group, Inc.
Banknorth Capital Trust I
Registration Statement on Form S-4
----------------------------------
Ladies and Gentlemen:
We have acted as counsel to Banknorth Group, Inc., a Delaware
corporation (the "Corporation") and Sponsor of Banknorth Capital Trust I, a
Delaware statutory business trust (the "Trust"), in connection with a
Registration Statement on Form S-4 (the "Registration Statement") relating to:
(i) the proposed issuance by the Trust of up to and including $30,000,000
aggregate Liquidation Amount of its 10.52% Capital Securities, Series B (the
"Exchange Capital Securities") registered under the Securities Act of 1933, as
amended (the "Securities Act"), in exchange for up to and including $30,000,000
aggregate Liquidation Amount of its outstanding 10.52% Capital Securities,
Series A (the "Original Capital Securities"); (ii) the proposed issuance by the
Corporation to the Trust, in an aggregate principal amount corresponding to the
aggregate Liquidation Amount of the Exchange Capital Securities, of the
Corporation's 10.52% Junior Subordinated Deferrable Interest Debentures
due May 1, 2027, Series B (the "Exchange Junior Subordinated Debentures")
registered under the Securities Act in exchange for a comparable aggregate
principal amount of the Corporation's outstanding 10.52% Junior Subordinated
Deferrable Interest Debentures due May 1, 2027, Series A (the "Original Junior
Subordinated Debentures"); and (iii) the proposed execution of the Corporation's
guarantee in respect of the Exchange Capital Securities (the "Exchange
Guarantee") registered under the Securities Act. The Exchange Capital Securities
will be issued under an Amended and Restated Declaration of Trust for the Trust,
dated as of May 1, 1997 (the "Amended Declaration"), among the Corporation, as
Sponsor, The First National Bank of Chicago, as Property Trustee, First Chicago
Delaware Inc., as Delaware Trustee, and the Administrative Trustees named
therein, while the Exchange Junior Subordinated Debentures will be issued
under an
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Indenture, dated as of May 1, 1997 (the "Indenture"), between the Corporation
and The First National Bank of Chicago, as Debenture Trustee.
We have examined such documents and records as we deemed appropriate,
including the following:
(i) Copy of the Certificate of Incorporation of the Corporation,
certified as of a recent date by the Secretary of State of the State of
Delaware;
(ii) Copy of the By-Laws of the Corporation, certified by the
Secretary of the Corporation to be a true and complete copy;
(iii) Copy, certified by the Secretary of the Corporation to be a
true and complete copy, of the resolutions duly adopted by the Board of
Directors of the Corporation on September 22, 1997, as supplemented by a
certificate of the President, dated September 23, 1997 relating thereto;
(iv) Executed counterparts of the Amended Declaration.
(v) Specimen of the Exchange Capital Security.
(vi) Executed counterparts of the Indenture.
(vii) Specimen of the Exchange Junior Subordinated Debenture.
(viii) Executed counterparts of the Exchange Guarantee.
(ix) Executed counterparts of the Registration Rights Agreement,
dated as of May 1, 1997 (the "Registration Rights Agreement"), among the
Trust, the Corporation and the Initial Purchasers named therein.
In addition, as to certain factual matters, we have relied upon
certificates of officers of the Corporation, public officials and others.
In the course of our examination, we have assumed the legal capacity of
all natural persons, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. In making our
examination of documents executed by parties other than the Corporation we have
assumed that such parties had the power, corporate or other, to enter into and
perform all obligations thereunder and have also assumed the due authorization
by all requisite action, corporate or other, and execution and delivery by such
parties of such documents, as well as the validity, binding effect and
enforceability thereof on such parties.
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Based upon the foregoing, we are of the opinion that:
(1) The Exchange Junior Subordinated Debentures have been duly authorized
by all requisite corporate action of the Corporation and, when executed and
authenticated in the manner provided for in the Indenture and delivered against
surrender and cancellation of a like aggregate principal amount of Original
Junior Subordinated Debentures as contemplated in the Registration Rights
Agreement, the Exchange Junior Subordinated Debentures will constitute valid and
binding obligations of the Corporation entitled to the benefits of the Indenture
and enforceable against the Corporation in accordance with their terms, except
as enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally or by general equitable principles (regardless of whether considered
in a proceeding in equity or at law).
(2) The Exchange Guarantee has been duly authorized by all requisite
corporate action of the Corporation and, when executed by the Corporation and
The First National Bank of Chicago, as Guarantee Trustee, and delivered as
contemplated in the Registration Rights Agreement, the Exchange Guarantee will
constitute a valid and binding agreement of the Corporation, enforceable against
the Corporation in accordance with its terms, except as enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally or by general
equitable principles (regardless of whether considered in a proceeding in equity
or at law).
We are members of the Bar of the State of New York and we express no
opinion as to the laws of any jurisdiction other than the laws of the State of
New York and the federal laws of the United States of America. As to matters
governed by Delaware law, we have relied exclusively upon the opinion of
Richards, Layton & Finger and have not made any independent investigation
thereof.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the caption
"Validity of Exchange Securities" in the Prospectus included therein.
Very truly yours,
BROWN & WOOD LLP
3
[LETTERHEAD OF RICHARDS, LAYTON & FINGER]
September _, 1997
Banknorth Capital Trust I
c/o Banknorth Group, Inc.
300 Financial Plaza
Burlington, Vermont 05401
Re: Banknorth Capital Trust I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Banknorth 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 April 9, 1997 (the
"Certificate"), as filed in the office of the Secretary of State of the
State of Delaware (the "Secretary of State") on April 9, 1997;
(b) The Declaration of Trust of the Trust, dated as of April 9, 1997, as
amended and restated by the Amended and Restated Declaration of Trust of
the Trust, dated as of May 1, 1997 (including Exhibits A, C and E thereto)
(collectively, the "Declaration"), among Banknorth Group, Inc., a Delaware
corporation (the "Company"), as Sponsor, the trustees of the Trust named
therein (collectively, the "Trustees") and the holders, from time to time,
of undivided beneficial interests in the assets of the Trust;
(c) The Registration Statement (the "Registration Statement") on Form S-4,
including a prospectus with respect to the Company and the Trust (the
"Prospectus"), relating to, amoung other things, the 10.52% Capital
Securities, Series B, of the Trust representing preferred undivided
beneficial interests in the assets of the Trust (each, an "Exchange
Security" and collectively, the "Exchange Securtites"), filed by the
Company and the Trust with the Securities and Exchange Commission and
September 24, 1997; and
(d) A Certificate of Good Standing for the Trust, dated September _, 1997,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are used
as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists
no provision in any document that we have not reviewed that bears upon
or is inconsistent with the opinions stated herein. We have conducted
no independent factual investigation of our own but rather have
replied solely upon the foregoing documents, the statements and
information set forth therein and the additional matters recited or
assumed herein, all of which we have assumed to be true, complete and
accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii)
the conformity with the originals of all documents submitted to us as copies
or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
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 Declaration and the
Certificate are in full force and effect and have not been amended, (ii)
except to the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid existence in
good standing of each party to the documents examined by us under the laws
of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the
documents examined by us, (iv) that each of the parties to the documents
examined by us has the power and authority to execute and deliver, and to
preform 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 an Exchange Security is to be
issued by the Turst (collectively, the "Security Holders") of a certificate
for such Exchange Security and the payment for the Exchange Security acquired
by it, in accordance with the Declaration and the Prospectus, and (vii) that the
Exchange Securities are issued and sold to the Security Holders in accordance
with the Declaration and the Prospectus. We have not participated in the
preparation of the Prospectus 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 on 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 which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of laws 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. When issued and sold, the Exchange Securities will represent
valid and, subject to the qualifications set forth in paragraph 3 below,
fully paid and nonassessable undivided beneficial interest in the assets of
the Trust.
3. The 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 Security Holders
may be obligated to make payments as set forth in the Declaration.
We consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement. In
addition, we hereby consent to the use of our name under the heading
"Validity of Exchange Securities" 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,
EAM
<PAGE>
Exhibit 8.1
September 24, 1997
Banknorth Group, Inc.
300 Financial Plaza
Burlington, Vermont 05401
Re: Banknorth Group, Inc.
Banknorth Capital Trust I
Registration Statement
--------------------------
Dear Sirs:
We have acted as special tax counsel to Banknorth Group, Inc., a Delaware
corporation (the "Corporation" or "Banknorth") and Sponsor of Banknorth Capital
Trust I, a statutory business trust formed under the laws of the State of
Delaware (the "Trust"), in connection with a Registration Statement on Form S-4
(the "Registration Statement"), filed by the Corporation and the Trust on
September 24, 1997 with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended (the "1933 Act") relating to the registration
of the 10.52% Capital Securities, Series B of the Trust (the "Original Capital
Securities"), the 10.52% Junior Subordinated Deferrable Interest Debentures,
Series B, due May 1, 2027 of the Corporation, and the Series B Capital
Securities Guarantee of the Corporation with respect thereto. Capitalized terms
used herein but not defined have the meanings as provided in the prospectus.
In rendering our opinion, we have examined the Amended and Restated
Declaration of Trust (the "Trust Agreement") of the Trust among the Corporation,
as Sponsor of the Trust, The First National Bank of Chicago, as property trustee
(the "Property Trustee"), First Chicago Delaware, Inc., as Delaware trustee (the
"Delaware Trustee"), and the Administrative Trustees named therein
(collectively, with the Property Trustee and the Delaware Trustee, the "Issuer
Trustees"), and have assumed that the Issuer Trustees will conduct the affairs
of the Trust in accordance with the Trust Agreement.
We hereby confirm the opinions described under the caption "Certain
Federal Income Tax Consequences" in the Prospectus that is part of the
Registration Statement.
We hereby consent to the use of our name under the caption "Certain
Federal Income Tax Consequences" in the
2
<PAGE>
Prospectus. The issuance of such a consent does not concede that we are an
"Expert" for the purposes of the 1933 Act.
Very truly yours,
/s/ Brown & Wood LLP
BROWN & WOOD LLP
3
Exhibit 12.1
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Including Interest on Deposits)
The Corporation's ratios of earnings to fixed charges (including interest on
deposits) for the six months ended June 30, 1997 and for the five years ended
December 31, 1996 were as follows:
<TABLE>
<CAPTION>
Six
Months
Ended
June 30, Years Ended December 31,
-------- -----------------------------------------------------
(Dollars in thousands) 1997 1996 1995 1994 1993 1992
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net income $ 14,139 $ 25,390 $ 22,373 $ 16,041 $ 7,961 $ 2,171
Extraordinary items, net of 0
tax 0 0 0 0 0
Cumulative effect of changes
in accounting principles, net 0
of tax 0 0 0 138 (3,500)
Income tax expense 6,773 11,981 8,217 5,734 5,235 163
-------- -------- -------- -------- -------- --------
Pretax earnings $ 20,912 $ 37,371 $ 30,590 $ 21,637 $ 16,696 $ 2,334
======== ======== ======== ======== ======== ========
Fixed charges:
Portion of rental expense
which approximates the
interest factor $ 322 $ 579 $ 340 $ 320 $ 280 $ 280
Interest on borrowed funds 9,637 10,522 14,891 11,808 6,728 2,852
-------- -------- -------- -------- -------- --------
Interest on deposits 37,245 70,618 53,089 37,791 37,942 55,723
-------- -------- -------- -------- -------- --------
Amortization of debt expense 24 47 47 12 0 0
Total fixed charges $ 47,228 $ 81,766 $ 68,367 $ 49,931 $ 44,950 $ 58,855
======== ======== ======== ======== ======== ========
Earnings for ratio calculations $ 68,140 $119,137 $ 98,957 $ 71,568 $ 61,646 $ 61,189
======== ======== ======== ======== ======== ========
Ratio of earnings for fixed
charges 1.44x 1.46x 1.45x 1.43x 1.37x 1.04x
======== ======== ======== ======== ======== ========
</TABLE>
Exhibit 12.2
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
(Excluding Interest on Deposits)
The Corporation's ratios of earnings to fixed charges (excluding interest on
deposits) for the six months ended June 30, 1997 and for the five years ended
December 31, 1996 were as follows:
<TABLE>
<CAPTION>
Six
Months
Ended
June 30, Years Ended December 31,
-------- -----------------------------------------------------
(Dollars in thousands) 1997 1996 1995 1994 1993 1992
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net income $ 14,139 $ 25,390 $ 22,373 $ 16,041 $ 7,961 $ 2,171
Extraordinary items, net of 0 0 0 0 0 0
tax
Cumulative effect of changes
in accounting principles, net 0 0 0 138 (3,500) 0
of tax
Income tax expense 6,773 11,981 8,217 5,734 5,235 163
-------- -------- -------- -------- -------- --------
Pretax earnings $ 20,912 $ 37,371 $ 30,590 $ 21,637 $ 16,696 $ 2,334
======== ======== ======== ======== ======== ========
Fixed charges:
Portion of rental expense
which approximates the
interest factor $ 322 $ 579 $ 340 $ 320 $ 280 $ 280
Interest on borrowed funds 9,637 10,522 14,891 11,808 6,728 2,852
-------- -------- -------- -------- -------- --------
Amortization of debt expense 24 47 47 12 0 0
Total fixed charges $ 9,983 $ 11,148 $ 15,278 $ 12,140 $ 7,008 $ 3,132
======== ======== ======== ======== ======== ========
Earnings for ratio calculations $ 30,895 $ 48,519 $ 45,868 $ 33,777 $ 23,704 $ 5,466
======== ======== ======== ======== ======== ========
Ratio of earnings for fixed
charges 3.09x 4.35x 3.00x 2.78x 3.38x 1.75x
======== ======== ======== ======== ======== ========
</TABLE>
Exhibit 23.3
Independent Auditors' Consent
The Board of Directors and Shareholders
Banknorth Group, Inc.:
We consent to incorporation by reference in the registration statement (No. not
yet assigned) on Form S-4 related to the 10.52% Capital Securities, Series B, of
Banknorth Capital Trust I of our audit report dated January 24, 1997, relating
to the consolidated balance sheets of Banknorth Group, Inc. and subsidiaries as
of December 31, 1996 and 1995, and the related consolidated statements of
income, changes in shareholders' equity, and cash flows for each of the years in
the three-year period ended December 31, 1996, which report appears in the
December 31, 1996 Annual Report on Form 10-K, as amended by Form 10-K/A, of
Banknorth Group, Inc. and to the reference to our firm under the heading
"Experts" in the prospectus. Our audit report refers to the adoption of the
provisions of Statement of Financial Accounting Standards No. 122, "Accounting
for Mortgage Servicing Rights," Statement of Financial Accounting Standards No.
114, "Accounting by Creditors for Impairment of a Loan," Statement of Financial
Accounting Standards No. 118, "Accounting by Creditors for Impairment of a
Loan-Income Recognition and Disclosures," and Statement of Financial Accounting
Standards No. 115, "Accounting for Certain Investments in Debt and Equity
Securities."
/s/ KPMG Peat Marwick LLP
Albany, New York
September 23, 1997
<PAGE>
The Board of Directors
Banknorth Group, Inc.:
Re: Registration Statement (No. not yet assigned) related to the
10.52% Capital Securities, Series B, of Banknorth Capital
Trust I.
With respect to the subject registration statement on From S-4, we acknowledge
our awareness of the use therein of our reports dated April 25, 1997 and July
25, 1997 related to our reviews of consolidated interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such reports are not
considered part of a registration statement prepared or certified by an
accountant or a report prepared or certified by an accountant within the meaning
of sections 7 and 11 of the Act.
/s/ KPMG Peat Marwick LLP
Albany, New York
September 23, 1997
2
<PAGE>
EXHIBIT 26.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2)
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
BANKNORTH CAPITAL TRUST I
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE (Applied for)
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
300 FINANCIAL PLAZA
BURLINGTON, VERMONT 05401
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
10.52% CAPITAL SECURITIES, SERIES B
(TITLE OF INDENTURE SECURITIES)
<PAGE>
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.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of
Governors of the Federal Reserve System, Washington D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
3
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all
in the City of Chicago and State of Illinois, on the 18th day of
September, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
* EXHIBITS 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS
BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK
OF CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA INC. FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 25,
1996 (REGISTRATION NO. 333-14201).
4
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
September 18, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of the Amended and Restated Declaration of
Trust of Banknorth Capital Trust I, the undersigned, in accordance with Section
321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that the
reports of examinations of the undersigned, made by Federal or State authorities
authorized to make such examinations, may be furnished by such authorities to
the Securities and Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
5
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR JUNE 30, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
ASSETS
<S> <C> <C> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1).. 0081 4,415,563 1.a.
b. Interest-bearing balances(2)........................... 0071 7.049,275 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 4,455,173 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,604,233 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)..................................................... RCFD 2122 24,185,099 4.a.
b. LESS: Allowance for loan and lease losses.............. RCFD 3123 423,419 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 23,761,680 4.d.
5. Trading assets (from Schedule RD-D)....................... 3545 6.930.216 5.
6. Premises and fixed assets (including capitalized leases).. 2145 705,704 6.
7. Other real estate owned (from Schedule RC-M)..... 2150 7,960 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)............................ 2130 64,504 8.
9. Customers' liability to this bank on acceptances outstanding....... 2155 562,251 9.
10. Intangible assets (from Schedule RC-M).................... 2143 283,716 10.
11. Other assets (from Schedule RC-F)......................... 2160 1,997,778 11.
12. Total assets (sum of items 1 through 11).................. 2170 54,837,423 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
6
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
<S> <C> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................... RCON 2200 21,852,164 13.a
(1) Noninterest-bearing(1).................... RCON 6631 9,474,510 13.a.1
(2) Interest-bearing.......................... RCON 6636 12,377,654 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)... RCFN 2200 13,756,280 13.b.
(1) Noninterest bearing....................... RCFN 6631 330,030 13.b.1
(2) Interest-bearing.......................... RCFN 6636 13,426,250 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.827,159 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 40,307 15.a
b. Trading Liabilities(from Schedule RC-D)..................................... RCFD 3548 4,985,577 15.b
16. Other borrowed money:
a. With original maturity of one year or less.... RCFD 2332 2,337,018 16.a
b. With original maturity of than one year through three years.... A547 265,393 16.b
. c. With a remaining maturity of more than three years ................................ A548 322,175 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding RCFD 2920 562,251 18
19. Subordinated notes and debentures (2)... RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G).. RCFD 2930 929,875 20
21. Total liabilities (sum of items 13 through 20)... RCFD 2948 50,618,199 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.... RCFD 3838 0 23
24. Common stock..................................... RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,948,616 25
26. a. Undivided profits and capital reserves........ RCFD 3632 1,059,214 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................... RCFD 8434 12,788 26.b.
27. Cumulative foreign currency translation adjustments RCFD 3284 (2,252) 27
28. Total equity capital (sum of items 23 through 27) RCFD 3210 4,219,224 28
29. Total liabilities and equity capital (sum of items 21 and 28)............... RCFD 3300 54,837,423 29
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
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 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . .RCFD 6724 . ... N/A M.1.
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other with
generally accepted auditing standards by a certified external auditors (may be required by state chartering
which submits a report on the bank chartering authority) authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standard
by a certified public accounting firm (may be required
by state chartering authority)
</TABLE>
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
7
<PAGE>
<PAGE>
EXHIBIT 26.2
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2)
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
BANKNORTH GROUP, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 03-0321189
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
300 FINANCIAL PLAZA
BURLINGTON, VERMONT 05401
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
GUARANTEE OF 10.52% CAPITAL SECURITIES, SERIES B
(TITLE OF INDENTURE SECURITIES)
2
<PAGE>
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.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of
Governors of the Federal Reserve System, Washington D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
3
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all
in the City of Chicago and State of Illinois, on the 18th day of
September, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
* EXHIBITS 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS
BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK
OF CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA INC. FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 25,
1996 (REGISTRATION NO. 333-14201).
4
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
September 18, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of a Guarantee of Banknorth Group, Inc.,
relating to the 10.52% Capital Securities, Series B of Banknorth Capital Trust
I, the undersigned, in accordance with Section 321(b) of the Trust Indenture Act
of 1939, as amended, hereby consents that the reports of examinations of the
undersigned, made by Federal or State authorities authorized to make such
examinations, may be furnished by such authorities to the Securities and
Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
5
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR JUNE 30, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
ASSETS
<S> <C> <C> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1).. 0081 4,415,563 1.a.
b. Interest-bearing balances(2)........................... 0071 7.049,275 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 4,455,173 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,604,233 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)..................................................... RCFD 2122 24,185,099 4.a.
b. LESS: Allowance for loan and lease losses.............. RCFD 3123 423,419 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 23,761,680 4.d.
5. Trading assets (from Schedule RD-D)....................... 3545 6.930.216 5.
6. Premises and fixed assets (including capitalized leases).. 2145 705,704 6.
7. Other real estate owned (from Schedule RC-M)..... 2150 7,960 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)............................ 2130 64,504 8.
9. Customers' liability to this bank on acceptances outstanding....... 2155 562,251 9.
10. Intangible assets (from Schedule RC-M).................... 2143 283,716 10.
11. Other assets (from Schedule RC-F)......................... 2160 1,997,778 11.
12. Total assets (sum of items 1 through 11).................. 2170 54,837,423 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
6
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
LIABILITIES
<S> <C> <C> <C> <C> <C>
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................... RCON 2200 21,852,164 13.a
(1) Noninterest-bearing(1).................... RCON 6631 9,474,510 13.a.1
(2) Interest-bearing.......................... RCON 6636 12,377,654 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)... RCFN 2200 13,756,280 13.b.
(1) Noninterest bearing....................... RCFN 6631 330,030 13.b.1
(2) Interest-bearing.......................... RCFN 6636 13,426,250 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.827,159 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 40,307 15.a
b. Trading Liabilities(from Schedule RC-D)............................................. RCFD 3548 4,985,577 15.b
16. Other borrowed money:
a. With original maturity of one year or less.... RCFD 2332 2,337,018 16.a
b. With original maturity of than one year through three years.... A547 265,393 16.b
. c. With a remaining maturity of more than three years ................................ A548 322,175 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding RCFD 2920 562,251 18
19. Subordinated notes and debentures (2)... RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G).. RCFD 2930 929,875 20
21. Total liabilities (sum of items 13 through 20)... RCFD 2948 50,618,199 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.... RCFD 3838 0 23
24. Common stock..................................... RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,948,616 25
26. a. Undivided profits and capital reserves........ RCFD 3632 1,059,214 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................... RCFD 8434 12,788 26.b.
27. Cumulative foreign currency translation adjustments RCFD 3284 (2,252) 27
28. Total equity capital (sum of items 23 through 27) RCFD 3210 4,219,224 9
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
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 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . ..RCFD 6724 . ... N/A M.1.
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
1 = Independent audit of the bank conducted in accordance 4 = Director's examination of the bank performed
with generally accepted auditing standards by a by other external auditors (may be required
certified public accounting firm which submits a by state chartering authority)
report on the bank
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit
work accordance with generally accepted auditing
standards by a certified public accounting firm (may be
required by state chartering authority)
</TABLE>
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
7
<PAGE>
EXHIBIT 26.3
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(B)(2)
THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)
A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
BANKNORTH GROUP, INC.
(EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER)
DELAWARE 03-0321189
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
300 FINANCIAL PLAZA
BURLINGTON, VERMONT 05401
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
10.52% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES, SERIES B, DUE 2027
(TITLE OF INDENTURE SECURITIES)
<PAGE>
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.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of
Governors of the Federal Reserve System, Washington D.C.
(B) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
3
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all
in the City of Chicago and State of Illinois, on the 18th day of
September, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
BY /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
* EXHIBITS 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS
BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK
OF CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA INC. FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 25,
1996 (REGISTRATION NO. 333-14201).
4
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
September 18, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Banknorth Group,
Inc. and The First National Bank of Chicago, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents
that the reports of examinations of the undersigned, made by Federal or State
authorities authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
BY: /S/ RICHARD D. MANELLA
RICHARD D. MANELLA
VICE PRESIDENT AND SENIOR COUNSEL
5
<PAGE>
EXHIBIT 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR JUNE 30, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
---------
THOUSANDS RCFD BIL MIL THOU
-------------- ------ -------------
ASSETS
<S> <C> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1).. 0081 4,415,563 1.a.
b. Interest-bearing balances(2)........................... 0071 7.049,275 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 4,455,173 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,604,233 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)..................................................... RCFD 2122 24,185,099 4.a.
b. LESS: Allowance for loan and lease losses.............. RCFD 3123 423,419 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 23,761,680 4.d.
5. Trading assets (from Schedule RD-D)....................... 3545 6.930.216 5.
6. Premises and fixed assets (including capitalized leases).. 2145 705,704 6.
7. Other real estate owned (from Schedule RC-M)..... 2150 7,960 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)............................ 2130 64,504 8.
9. Customers' liability to this bank on acceptances outstanding....... 2155 562,251 9.
10. Intangible assets (from Schedule RC-M).................... 2143 283,716 10.
11. Other assets (from Schedule RC-F)......................... 2160 1,997,778 11.
12. Total assets (sum of items 1 through 11).................. 2170 54,837,423 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
6
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
Thousands BIL MIL THOU
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................... RCON 2200 21,852,164 13.a
(1) Noninterest-bearing(1).................... RCON 6631 9,474,510 13.a.1
(2) Interest-bearing.......................... RCON 6636 12,377,654 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)... RCFN 2200 13,756,280 13.b.
(1) Noninterest bearing....................... RCFN 6631 330,030 13.b.1
(2) Interest-bearing.......................... RCFN 6636 13,426,250 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.827,159 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 40,307 15.a
b. Trading Liabilities(from Schedule RC-D)....................................... RCFD 3548 4,985,577 15.b
16. Other borrowed money:
a. With original maturity of one year or less.... RCFD 2332 2,337,018 16.a
b. With original maturity of than one year through three years.... A547 265,393 16.b
. c. With a remaining maturity of more than three years ................................ A548 322,175 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding RCFD 2920 562,251 18
19. Subordinated notes and debentures (2)... RCFD 3200 1,700,000 19
20. Other liabilities (from Schedule RC-G).. RCFD 2930 929,875 20
21. Total liabilities (sum of items 13 through 20)... RCFD 2948 50,618,199 21
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.... RCFD 3838 0 23
24. Common stock..................................... RCFD 3230 200,858 24
25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,948,616 25
26. a. Undivided profits and capital reserves........ RCFD 3632 1,059,214 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................... RCFD 8434 12,788 26.b.
27. Cumulative foreign currency translation adjustments RCFD 3284 (2,252) 27
28. Total equity capital (sum of items 23 through 27) RCFD 3210 4,219,224 28
29. Total liabilities and equity capital (sum of items 21 and 28)............... RCFD 3300 54,837,423 29
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
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 1996 . . . . . . . . . . . . . . . . . . . . . . ..RCFD 6724 . ... N/A M.1.
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit
work accordance with generally accepted auditing standards by a certified
public accounting firm (may be required by state chartering authority)
</TABLE>
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
7
<PAGE>
Exhibit 99.1
LETTER OF TRANSMITTAL
Banknorth Capital Trust I
BANKNORTH CAPITAL TRUST I
OFFER TO EXCHANGE ITS
10.52% CAPITAL SECURITIES, SERIES B
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
10.52% CAPITAL SECURITIES, SERIES A
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
BANKNORTH GROUP, INC.
PURSUANT TO THE PROSPECTUS DATED SEPTEMBER __, 1997
(AS THE SAME MAY BE AMENDED OR SUPPLEMENTED, THE "PROSPECTUS")
- --------------------------------------------------------------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL
EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON ____________, 1997,
OR ON SUCH LATER DATE OR TIME TO WHICH
THE CORPORATION OR THE TRUST
MAY EXTEND THE EXCHANGE OFFER (THE "EXPIRATION DATE").
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:
The First National Bank of Chicago
By Hand, Overnight Delivery, Registered or Certified Mail:
c/o First Chicago Trust
14 Wall Street
8th Floor, Window 2
New York, New York 10005
Confirm by Telephone: (212) 240-8801
Facsimile Transmissions: (212) 240-8938
(ELIGIBLE INSTITUTIONS ONLY)
<PAGE>
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.
Capitalized terms used but not defined herein shall have the same meaning
given them in the Prospectus. As used herein, the term "Holder" means a holder
of 10.52% Capital Securities, Series A (the "Original Capital Securities"),
including any participant ("DTC Participant") in the book-entry transfer
facility system of The Depository Trust Company ("DTC") whose name appears on a
security position listing as the owner of the Original Capital Securities. As
used herein, the term "Certificates" means physical certificates representing
Original Capital Securities.
To participate in the Exchange Offer (as defined below), Holders must
tender by (a) book-entry transfer pursuant to the procedures set forth in the
Prospectus under "The Exchange Offer-Procedures for Tendering Original Capital
Securities," or (b) forwarding Certificates herewith.
Holders who are DTC Participants tendering by book-entry transfer must
execute such tender through the Automated Tender Offer Program ("ATOP") of DTC.
A Holder using ATOP should transmit its acceptance to DTC on or prior to the
Expiration Date. DTC will verify such acceptance, execute a book-entry transfer
of the tendered Original Capital Securities into the Exchange Agent's account at
DTC and then send to the Exchange Agent confirmation of such book-entry transfer
(a "book-entry confirmation"), including an agent's message ("Agent's Message")
confirming that DTC has received an express acknowledgment from such Holder that
such Holder has received and agrees to be bound by this Letter of Transmittal
and that the Trust and the Corporation may enforce this Letter of Transmittal
against such Holder. The book-entry confirmation must be received by the
Exchange Agent in order for the tender relating thereto to be effective.
Book-entry transfer to DTC in accordance with DTC's procedures does not
constitute delivery of the book-entry confirmation to the Exchange Agent.
If the tender is not made through ATOP, Certificates, as well as this
Letter of Transmittal (or facsimile thereof), 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 in order for
such tender to be effective.
Holders of Original Capital Securities who cannot complete the procedures
for delivery by book-entry transfer of such Original Capital Securities on a
timely basis or who cannot deliver their Certificates for such Original Capital
Securities and all other required documents to the Exchange Agent on or prior to
the Expiration Date, must, in order to participate in the Exchange Offer, tender
their Original Capital Securities according to the guaranteed delivery
procedures set forth in the Prospectus under "The Exchange Offer--Procedures for
Tendering Original Capital Securities."
THE METHOD OF DELIVERY OF THE BOOK-ENTRY CONFIRMATION OR 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.
-2-
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
ALL TENDERING HOLDERS COMPLETE THIS BOX:
================================================================================
DESCRIPTION OF ORIGINAL CAPITAL SECURITIES
- --------------------------------------------------------------------------------
If blank, please print name and Original Capital Securities tendered
address of registered holder. (Attach additional list if necessary)
- --------------------------------------------------------------------------------
Liquidation Amount of
Certificate Aggregate Liquidation Original Capital
Number(s) Amount of Original Securities Tendered
Capital Securities (if less than all)**
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
-------------------------------------------------------------
TOTAL AMOUNT
TENDERED
- --------------------------------------------------------------------------------
* Need not be completed by book-entry holders.
** Original Capital Securities may be tendered in whole or in part in
Liquidation Amounts of $100,000 and integral multiples of $1,000 in excess
thereof, provided that if any Original Capital Securities are tendered for
exchange in part, the untendered Liquidation Amount thereof must be
$100,000 or any integral multiple of $1,000 in excess thereof. All
Original Capital Securities held shall be deemed tendered unless a lesser
number is specified in this column. See Instruction 4.
==========================================================================
-3-
<PAGE>
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
[_] CHECK HERE IF TENDERED ORIGINAL 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 ORIGINAL 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 Holder(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 YOU ARE A BROKER-DEALER WHO ACQUIRED THE ORIGINAL CAPITAL
SECURITIES FOR YOUR OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER
TRADING ACTIVITIES AND WISH TO RECEIVE TEN ADDITIONAL COPIES OF THE
PROSPECTUS AND TEN COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name: __________________________________________________________________________
Address: _______________________________________________________________________
-4-
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Banknorth Capital Trust I, a trust
formed under the laws of the State of Delaware (the "Trust"), and Banknorth
Group, Inc., a Delaware corporation (the "Corporation"), the above described
aggregate Liquidation Amount of the Trust's Original Capital Securities in
exchange for a like aggregate Liquidation Amount of the Trust's 10.52% Capital
Securities, Series B (the "Exchange Capital Securities"), which have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
upon the terms and subject to the conditions set forth in the Prospectus,
receipt of which is hereby acknowledged, and in this Letter of Transmittal
(which, together with the Prospectus, constitute the "Exchange Offer").
Subject to and effective upon the acceptance for exchange of all or any
portion of the Original 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 Trust all right, title and interest in and to such Original 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
Corporation and the Trust in connection with the Exchange Offer) with respect to
the tendered Original 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 Original Capital Securities to the Corporation
or the Trust together with all accompanying evidences of transfer and
authenticity to, or upon the order of, the Trust, upon receipt by the Exchange
Agent, as the undersigned's agent, of the Exchange Capital Securities to be
issued in exchange for such Original Capital Securities, (ii) present
Certificates for such Original Capital Securities for transfer, and to transfer
the Original Capital Securities on the books of the Trust, and (iii) receive for
the account of the Trust all benefits and otherwise exercise all rights of
beneficial ownership of such Original 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
ORIGINAL CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE ACCEPTED
FOR EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED TITLE
THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND ENCUMBRANCES,
AND THAT THE ORIGINAL 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 TRUST OR THE EXCHANGE AGENT TO BE
NECESSARY OR DESIRABLE TO COMPLETE THE EXCHANGE, ASSIGNMENT AND TRANSFER OF THE
ORIGINAL CAPITAL SECURITIES TENDERED HEREBY, AND THE UNDERSIGNED WILL COMPLY
WITH ITS OBLIGATIONS UNDER THE REGISTRATION 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 Original
Capital Securities tendered hereby should be printed in the box entitled
"Description of Original Capital Securities" above, if they are not already set
forth in such box, as they appear on the Certificates representing such Original
Capital Securities or on the records of DTC, as the case may be. The Certificate
number(s) of any such Certificates and the Liquidation Amount of such Original
Capital Securities should be specified in such box as indicated therein.
The undersigned understands that tenders of Original Capital Securities
pursuant to any one of the procedures described in "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus
and in the instructions attached hereto will, upon the Corporation's and the
Trust's acceptance for exchange of such tendered Original Capital Securities,
constitute a binding agreement between the undersigned, the Corporation and the
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 Corporation and the Trust may not be required to accept for
exchange any of the Original Capital Securities tendered hereby.
Unless otherwise indicated in the box entitled "Special Issuance
Instructions" below, the undersigned hereby directs that the Exchange Capital
Securities be issued in the name(s) of the undersigned or credited to the
account at DTC indicated above in the case of a book-entry transfer of Original
Capital Securities.
-5-
<PAGE>
If any Original Capital Securities are submitted for more Original
Capital Securities than are tendered or accepted for exchange, then, without
expense to the tendering Holder, promptly following the expiration or
termination of the Exchange Offer, such non-exchanged or non-tendered Original
Capital Securities will, if evidenced by Certificates, be returned, or will, if
evidenced by book-entry, be credited to the account at DTC indicated above. If
applicable, substitute Certificates representing non-exchanged Original Capital
Securities will be issued to the undersigned or nonexchanges Original Capital
Securities will be credited to the account at DTC indicated above in the case of
a book-entry transfer of Original Capital Securities.
Unless otherwise indicated under "Special Delivery Instructions,"
certificates for Original Capital Securities and for Exchange Capital Securities
will be delivered to the undersigned at the address shown below the
undersigned's signature.
BY TENDERING ORIGINAL CAPITAL SECURITIES AND EXECUTING THIS LETTER OF
TRANSMITTAL, THE UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (1) THE
UNDERSIGNED IS NOT AN "AFFILIATE" (AS DEFINED IN RULE 144 UNDER THE SECURITIES
ACT) OF THE CORPORATION OR THE TRUST, (2) ANY EXCHANGE CAPITAL SECURITIES TO BE
RECEIVED BY THE UNDERSIGNED ARE BEING ACQUIRED IN THE ORDINARY COURSE OF ITS
BUSINESS, (3) THE UNDERSIGNED HAS NO ARRANGEMENT OR UNDERSTANDING WITH ANY
PERSON TO PARTICIPATE IN A DISTRIBUTION (WITHIN THE MEANING OF THE SECURITIES
ACT) OF EXCHANGE CAPITAL SECURITIES TO BE RECEIVED IN THE EXCHANGE OFFER, AND
(4) 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 EXCHANGE CAPITAL SECURITIES. BY TENDERING ORIGINAL
CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING THIS LETTER OF
TRANSMITTAL, A HOLDER OF ORIGINAL CAPITAL SECURITIES THAT 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 TO THIRD PARTIES, THAT (1) SUCH ORIGINAL CAPITAL SECURITIES ARE HELD
BY SUCH BROKER-DEALER ONLY AS A NOMINEE, OR (2) SUCH ORIGINAL CAPITAL SECURITIES
WERE ACQUIRED BY IT FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES
OR OTHER TRADING ACTIVITIES AND IT WILL DELIVER THE PROSPECTUS MEETING THE
REQUIREMENTS OF THE SECURITIES ACT IN CONNECTION WITH ANY RESALE OF SUCH
EXCHANGE CAPITAL SECURITIES (PROVIDED THAT, BY SO ACKNOWLEDGING AND BY
DELIVERING THE PROSPECTUS, IT WILL NOT BE DEEMED TO ADMIT THAT IT IS AN
"UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES ACT).
THE CORPORATION AND THE TRUST HAVE AGREED THAT, SUBJECT TO THE PROVISIONS
OF THE REGISTRATION AGREEMENT, THE PROSPECTUS MAY BE USED IN CONNECTION WITH
RESALES OF EXCHANGE CAPITAL SECURITIES RECEIVED IN EXCHANGE FOR ORIGINAL CAPITAL
SECURITIES BY A BROKER-DEALER WHO ACQUIRED ORIGINAL CAPITAL SECURITIES FOR ITS
OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING ACTIVITIES (A
"PARTICIPATING BROKER-DEALER") FOR A PERIOD ENDING 90 DAYS AFTER THE EXPIRATION
DATE (SUBJECT TO EXTENSION UNDER CERTAIN LIMITED CIRCUMSTANCES DESCRIBED IN THE
PROSPECTUS) OR, IF EARLIER, WHEN ALL SUCH EXCHANGE CAPITAL SECURITIES HAVE BEEN
DISPOSED OF BY SUCH PARTICIPATING BROKER-DEALER. IN THAT REGARD, EACH
PARTICIPATING BROKER-DEALER, BY TENDERING SUCH ORIGINAL CAPITAL SECURITIES AND
EXECUTING THIS LETTER OF TRANSMITTAL OR BY TENDERING THROUGH BOOK-ENTRY TRANSFER
IN LIEU THEREOF, AGREES THAT, UPON RECEIPT OF NOTICE FROM THE CORPORATION OR THE
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 EXCHANGE CAPITAL SECURITIES PURSUANT TO THE PROSPECTUS UNTIL (1) THE
CORPORATION AND THE 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 (2) THE
CORPORATION OR THE TRUST HAS GIVEN NOTICE THAT THE SALE OF THE EXCHANGE CAPITAL
SECURITIES MAY BE RESUMED, AS THE CASE MAY BE. IF THE CORPORATION OR THE TRUST
GIVES SUCH NOTICE TO SUSPEND THE SALE OF THE EXCHANGE CAPITAL SECURITIES, THEY
SHALL EXTEND THE 90-DAY PERIOD REFERRED TO ABOVE DURING WHICH PARTICIPATING
BROKER-DEALERS ARE ENTITLED TO USE THE PROSPECTUS IN CONNECTION WITH THE RESALE
OF
-6-
<PAGE>
EXCHANGE 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 ON
WHICH (1) PARTICIPATING BROKER-DEALERS SHALL HAVE RECEIVED COPIES OF THE
SUPPLEMENTED OR AMENDED PROSPECTUS NECESSARY TO PERMIT RESALES OF THE EXCHANGE
CAPITAL SECURITIES OR (2) THE CORPORATION OR THE TRUST HAS GIVEN NOTICE THAT THE
SALE OF EXCHANGE CAPITAL SECURITIES MAY BE RESUMED, AS THE CASE MAY BE.
AS A RESULT, A PARTICIPATING BROKER-DEALER WHO INTENDS TO USE THE
PROSPECTUS IN CONNECTION WITH RESALES OF EXCHANGE CAPITAL SECURITIES RECEIVED IN
EXCHANGE FOR ORIGINAL CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER MUST
NOTIFY THE CORPORATION AND THE TRUST, OR CAUSE THE CORPORATION AND THE TRUST TO
BE NOTIFIED, ON OR PRIOR TO THE EXPIRATION DATE, THAT IT IS A PARTICIPATING
BROKER-DEALER. SUCH NOTICE MAY BE GIVEN IN THE SPACE PROVIDED ABOVE OR MAY BE
DELIVERED TO THE EXCHANGE AGENT AT THE ADDRESS SET FORTH IN THE PROSPECTUS UNDER
"THE EXCHANGE OFFER-EXCHANGE AGENT."
Holders whose Original Capital Securities are accepted for exchange on or
prior to October 15, 1997 will not receive Distributions on such Original
Capital Securities and the undersigned hereby waives the right to receive any
Distributions on such Original Capital Securities accumulated from and including
May 1, 1997. Accordingly, holders of Exchange Capital Securities as of the
close of business on the record date for the payment of Distributions on
November 1, 1997 will be entitled to Distributions accumulated from and
including May 1, 1997.
The undersigned will, upon request, execute and deliver any additional
documents deemed by the Corporation or the Trust to be necessary or desirable to
complete the sale, assignment and transfer of the Original Capital Securities
tendered hereby. All authority herein conferred or agreed to be conferred in
this Letter of Transmittal shall survive the death 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 ORIGINAL
CAPITAL SECURITIES" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE
TENDERED THE ORIGINAL CAPITAL SECURITIES AS SET FORTH IN SUCH BOX.
-7-
<PAGE>
HOLDER(S) SIGN HERE
(SEE ATTACHED INSTRUCTIONS 2, 5 AND 6)
(PLEASE COMPLETE SUBSTITUTE FORM W-9 ON THE LAST PAGE)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY INSTRUCTION 2)
Must be signed by registered Holder(s) exactly as name(s) appear(s) on
Certificate(s) for the Original Capital Securities hereby tendered or on the
records of DTC, as the case may be, 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 Trust to comply with the restrictions on transfer applicable
to the Original 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, set forth the
signatory's full title. See Instruction 5.
________________________________________________________________________________
________________________________________________________________________________
(SIGNATURE(S) OF HOLDER(S))
Date ________________, 1997
Name(s)_________________________________________________________________________
________________________________________________________________________________
(PLEASE PRINT)
Capacity (full title)___________________________________________________________
Address_________________________________________________________________________
(INCLUDE ZIP CODE)
________________________________________________________________________________
________________________________________________________________________________
Area Code and Telephone Number__________________________________________________
________________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
-8-
<PAGE>
GUARANTEE OF SIGNATURE(S)
(SEE ATTACHED INSTRUCTIONS 2 AND 5)
________________________________________________________________________________
(AUTHORIZED SIGNATURE)
Date ______________, 1997
Name of Firm____________________________________________________________________
Capacity (full title)___________________________________________________________
(PLEASE PRINT)
Address_________________________________________________________________________
(INCLUDE ZIP CODE)
________________________________________________________________________________
________________________________________________________________________________
Area Code and Telephone Number__________________________________________________
-9-
<PAGE>
SPECIAL ISSUANCE INSTRUCTIONS
(SEE ATTACHED INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if certificates for Exchange Capital Securities or
non-tendered or nonexchanged Original Capital Securities are to be issued in the
name of someone other than the registered Holder(s) of the Original Capital
Securities whose name(s) appear(s) above.
Issue
[_] Non-tendered or non-exchanged Original Capital Securities to:
[_] Exchange Capital Securities to:
Name(s)_________________________________________________________________________
Address_________________________________________________________________________
(INCLUDE ZIP CODE)
________________________________________________________________________________
Area Code and
Telephone Number________________________________________________________________
________________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
-10-
<PAGE>
SPECIAL ISSUANCE INSTRUCTIONS
(SEE ATTACHED INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if certificates for Exchange Capital Securities or
non-tendered or nonexchanged Original Capital Securities are to be sent to
someone other than the registered Holder(s) of the Original Capital Securities
whose name(s) appear(s) at an address other than that above.
Mail
[_] Non-tendered or non-exchanged Original Capital Securities to:
[_] Exchange Capital Securities to:
Name(s)_________________________________________________________________________
Address_________________________________________________________________________
(INCLUDE ZIP CODE)
________________________________________________________________________________
Area Code and
Telephone Number________________________________________________________________
________________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
-11-
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. BOOK-ENTRY TRANSFER; DELIVERY OF LETTER OF TRANSMITTAL AND
CERTIFICATES; GUARANTEED DELIVERY PROCEDURES. To tender in the Exchange Offer,
Holders must tender by (a) forwarding Certificates herewith or (b) book-entry
transfer pursuant to the procedures set forth in "The Exchange Offer--Procedures
for Tendering Original Capital Securities" in the Prospectus. Holders who are
DTC Participants tendering by book-entry transfer must execute such tender
through DTC's ATOP system. A Holder using ATOP should transmit its acceptance to
DTC on or prior to the Expiration Date. DTC will verify such acceptance, execute
a book-entry transfer of the tendered Original Capital Securities into the
Exchange Agent's account at DTC and then send to the Exchange Agent a book-entry
confirmation, including an Agent's Message confirming that DTC has received an
express acknowledgment from such Holder that such Holder has received and agrees
to be bound by this Letter of Transmittal and that the Trust and the Corporation
may enforce this Letter of Transmittal against such Holder. The book-entry
confirmation must be received by the Exchange Agent in order for the tender
relating thereto to be effective. Book-entry transfer to DTC in accordance with
DTC's procedure does not constitute delivery of the book-entry confirmation to
the Exchange Agent.
IF THE TENDER IS NOT MADE THROUGH ATOP, CERTIFICATES, AS WELL AS THIS
LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF), 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 IN ORDER FOR
SUCH TENDER TO BE EFFECTIVE
Original Capital Securities may be tendered in whole or in part in the
Liquidation Amount of $100,000 (100 Capital Securities) and integral multiples
of $1,000 in excess thereof, provided that, if any Original 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.
Holders who wish to tender their Original Capital Securities and (i)
whose Original Capital Securities are not immediately available or (ii) who
cannot deliver their Original 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 Original Capital Securities by
properly completing and duly executing a notice to the Exchange Agent
guaranteeing delivery to the Exchange Agent of either certificates representing
the Original Capital Securities or a book-entry confirmation in compliance with
the requirements set forth in the Prospectus (the "Notice of Guaranteed
Delivery"), pursuant to the guaranteed delivery procedures set forth in the
Prospectus under "The Exchange Offer--Procedures for Tendering Original Capital
Securities--Guaranteed Delivery." Pursuant to such procedures: (i) such tender
must be made by or through an Eligible Institution (as defined below); (ii) a
properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form accompanying this Letter of Transmittal, must be
received by the Exchange Agent on or prior to the Expiration Date; and (iii) (a)
a book-entry confirmation or (b) the certificates representing all tendered
Original Capital Securities, in proper form for transfer, together with a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees and any other documents
required by this Letter of Transmittal, must be received by the Exchange Agent
within three New York Stock Exchange trading days after the date of execution of
such Notice of Guaranteed Delivery, all as provided in the Prospectus under "The
Exchange Offer--Procedures for Tendering Original Capital Securities--Guaranteed
Delivery".
A 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 Original 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 THE BOOK-ENTRY CONFIRMATION OR 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
-12-
<PAGE>
RECEIPT REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.
Neither the Corporation nor the Trust will accept any alternative,
conditional or contingent tenders. Each tendering Holder, by book-entry transfer
through ATOP or 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(s) of
Original 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 Original 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 Original Capital Securities" is inadequate, the Certificate
number(s) and/or the Liquidation Amount of Original 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 Original 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 Original 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
Original Capital Securities are to be tendered, fill in the Liquidation Amount
of Original Capital Securities that are to be tendered in the box entitled
"Liquidation Amount of Original Capital Securities Tendered." If applicable, new
Certificate(s) for the Original Capital Securities that were not tendered will
be sent to the address designated herein by such Holder promptly after the
Expiration Date. All Original 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 Original 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 such date, a written 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 such date. Any such notice of withdrawal must specify the name of
the person who tendered the Original Capital Securities to be withdrawn, the
aggregate Liquidation Amount of Original Capital Securities to be withdrawn,
and, if any Certificates for Original Capital Securities have been tendered, the
name of the registered Holder of the Original Capital Securities as set forth on
any such Certificates, if different from that of the person who tendered such
Original Capital Securities. If Certificates for the Original Capital Securities
have been delivered or otherwise identified to the Exchange Agent, then prior to
the physical release of such Certificates, the tendering Holder must submit the
serial numbers shown on the particular Certificates to be withdrawn and the
signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Original Capital Securities tendered for the
account of an Eligible Institution. If Original Capital Securities have been
tendered pursuant to the procedures for book-entry transfer set forth in the
Prospectus under "The Exchange Offer--Procedures for Tendering Original Capital
Securities," the notice of withdrawal must specify the name and number of the
account at DTC to be credited with the withdrawal of Original Capital
Securities. Withdrawals of tenders of Original Capital Securities may not be
rescinded. Original 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 herein.
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Corporation and
the Trust, in their sole discretion, whose determination shall be final and
binding on all parties. Neither the Corporation, the Trust, any affiliates or
assigns of the Corporation or the Trust or 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 Original Capital Securities which have been tendered but which
are withdrawn will be returned or transferred by book-entry, as the case may be,
to the Holder thereof without cost to such Holder promptly after withdrawal.
-13-
<PAGE>
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered Holder(s) of the Original
Capital Securities tendered hereby, the signature(s) must correspond exactly
with the name(s) as written on the face of the Certificate(s) for such Original
Capital Securities, without alteration, enlargement or any change whatsoever, or
as recorded in DTC's book-entry transfer facility system, as the case may be.
If any Certificates tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Original Capital Securities are registered in different
names on several Certificates, it will be necessary to complete, sign and submit
as many separate Letters of Transmittal as there are different registrations of
Certificates. If any tendered Original Capital Securities are registered in
different names in several book-entry accounts, proper procedures for book-entry
transfer must be followed for each account.
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 Corporation and the Trust in their sole discretion,
of each such person's authority so to act.
When this Letter of Transmittal is signed by the registered Holder(s) of
the Original Capital Securities listed and transmitted hereby, or book-entry
transfer is effectuated by such Holder(s), no endorsement(s) of Certificate(s)
or separate bond power(s) are required except if Exchange Capital Securities are
to be issued in the name of a person other than the registered Holder(s). If
such exception applies, 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 Holder(s) of the Original Capital Securities listed, the
Certificate(s) must be endorsed or accompanied by appropriate bond powers,
signed exactly as the name(s) of the registered Holder(s) appear(s) on the
Certificates, and also must be accompanied by such opinions of counsel,
certifications and other information as the Corporation or the Trust may require
in accordance with the restrictions on transfer applicable to the Original
Capital Securities. In such event, signatures on such Certificates or bond
powers must be guaranteed by an Eligible Institution.
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If Exchange Capital
Securities are to be issued in the name of a person other than the signer of
this Letter of Transmittal, or if Exchange 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. Original Capital Securities not exchanged will be returned,
if evidenced by Certificates, by mail or, if tendered by book-entry transfer, by
crediting the account at DTC indicated above in Instruction 4.
7. IRREGULARITIES. The Corporation and the 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 Original Capital Securities, which determination shall be final and
binding on all parties. The Corporation and the 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 which, may in the view of
counsel to the Corporation and the Trust be unlawful. The Corporation and the
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 Original Capital Securities of any particular
Holder whether or not similar conditions or irregularities are waived in the
case of other Holders. The Corporation's and the 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 Original
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 Corporation, the Trust, any affiliates or assigns of the Corporation, or the
Trust, or the Exchange Agent nor or any other person shall not 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 cover of this Letter of Transmittal.
Additional copies of the Prospectus, the Notice of Guaranteed Delivery and this
Letter of Transmittal may be obtained from the Exchange Agent or from your
broker, dealer, commercial bank, trust company or other nominee.
-14-
<PAGE>
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income
tax law, a Holder whose tendered Original Capital Securities are accepted for
exchange is required to provide the Exchange Agent with such Holder's correct
taxpayer identification number ("TIN") on 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 Original
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 Original Capital Securities or of the last transferee appearing on the
transfers attached to, or endorsed on, the Original Capital Securities. If the
Original 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 Corporation and the Trust reserve the
absolute right to waive satisfaction of any or all conditions enumerated in the
Prospectus.
11. NO CONDITIONAL TENDERS. No alternative, conditional or contingent
tenders will be accepted. All tendering Holders, by execution of this Letter of
Transmittal, shall waive any right to receive notice of the acceptance of
Original Capital Securities for exchange.
Neither the Corporation, the Trust, the Exchange Agent nor any other
person is obligated to give notice of any defect or irregularity with respect to
any tender of Original Capital Securities nor shall any of them incur any
liability for failure to give any such notice.
12. LOST, DESTROYED OR STOLEN CERTIFICATES. If any Certificate(s)
representing Original 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 Original Capital
Securities for exchange will not be obligated to pay any transfer taxes in
connection therewith. If, however, Exchange Capital Securities are to be
delivered to, or are to be issued in the name of, any person other than the
Holder of the Original Capital Securities tendered, or if a transfer tax is
imposed for any reason other than the exchange of Original Capital Securities in
connection with the Exchange Offer, then the amount of any such transfer tax
(whether imposed on the Holder or
-15-
<PAGE>
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
this Letter of Transmittal, the amount of such transfer taxes will be billed
directly to such tendering Holder.
IMPORTANT: BOOK-ENTRY CONFIRMATION OR THIS LETTER OF
TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON
OR PRIOR TO THE EXPIRATION DATE.
-16-
<PAGE>
TO BE COMPLETED BY ALL TENDERING SECURITYHOLDERS
(See Instruction 9)
PAYOR'S NAME: BANKERS TRUST COMPANY
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
SUBSTITUTE Part 1-PLEASE PROVIDE YOUR TIN IN TIN:__________________________
THE BOX AT RIGHT AND CERTIFY BY Social Security Number or
Form W-9 SIGNING AND DATING BELOW: Employer Identification Number
Department of the Treasury
Internal Revenue Service
---------------------------------------------------------------------
Payer's Request for
Taxpayer Part 2-TIN Applied For |_|
Identification Number
("TIN") ---------------------------------------------------------------------
and Certification
CERTIFICATION-UNDER THE 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.
The Internal Revenue Service does not require your consent to any provision of
this document other than the Certifications required to avoid backup
withholding.
Signature____________________________ Date__________
- --------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
You must cross out item (iii) in Part (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting
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.
- --------------------------------------------------------------------------------
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 2 OF THE 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 (1) 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 (2) 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 Exchange 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(s) Date
- --------------------------------------------------------------------------------
Exhibit 99.2
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF
10.52% CAPITAL SECURITIES, SERIES A
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
OF
BANKNORTH CAPITAL TRUST I
UNCONDITIONALLY GUARANTEED BY
BANKNORTH GROUP, 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 10.52% Capital Securities, Series A, of Banknorth Capital
Trust I (the "Original Capital Securities") are not immediately available, (ii)
Original Capital Securities, the Letter of Transmittal and all other required
documents cannot be delivered to The First National Bank of Chicago (the
"Exchange Agent") on or prior to 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. See "The Exchange
Offer--Procedures for Tendering Original Capital Securities" in the Prospectus.
In addition, in order to utilize the guaranteed delivery procedure to tender
Original Capital Securities pursuant to the Exchange Offer, a completed, signed
and dated Letter of Transmittal relating to the Original Capital Securities (or
facsimile thereof) must also be received by the Exchange Agent on or prior to
the Expiration Date. Capitalized terms not defined herein have the meanings
assigned to them in the Prospectus.
The Exchange Agent For The Exchange Offer Is:
The First National Bank of Chicago
By Hand, Overnight Delivery, Registered or Certified Mail:
The First National Bank of Chicago
c/o First Chicago Trust Company of New York
14 Wall Street
8th Floor, Window 2
New York, New York 10005
Confirm by Telephone: (212) 240-8801
Facsimile Transmissions: (212) 240-8938
(ELIGIBLE INSTITUTIONS ONLY)
<PAGE>
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.
-2-
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Banknorth Capital Trust I, a Delaware
business trust (the "Trust"), and to Banknorth Group, Inc., a Delaware
corporation (the "Corporation"), upon the terms and subject to the conditions
set forth in the Prospectus dated September , 1997 (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 Original Capital
Securities set forth below pursuant to the guaranteed delivery procedures set
forth in the Prospectus under the caption "The Exchange Offer--Procedures for
Tendering Original Capital Securities."
Aggregate Liquidation Amount: __________________________________________________
Name(s) of Registered Holder(s): _______________________________________________
_______________________________________________
Amount Tendered: $__________________
Certificate No(s) (if available): _______________________
_______________________
*Total Liquidation Amount Represented by Original Capital Securities
Certificate(s):
$____________________
If Original Capital Securities will be tendered by book-entry transfer, provide
the following information:
DTC Account Number: _________________
Date: __________________
- ----------
* Must be in Liquidation Amounts of $1,000 and any integral multiple
thereof, and not less than $100,000 aggregate Liquidation Amount.
-3-
<PAGE>
- --------------------------------------------------------------------------------
All authority herein conferred or agreed to be conferred shall survive
the death or incapacity of the undersigned and every obligation of the
undersigned hereunder shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
- --------------------------------------------------------------------------------
PLEASE SIGN HERE:
X
--------------------------------------- ---------------------------
X
--------------------------------------- ---------------------------
Signature(s) of Owner(s)
Date
or Authorized Signatory
Area Code and Telephone Number: ________________________________________________
This Notice of Guaranteed Delivery must be signed by the holder(s) of the
Original Capital Securities as their name(s) appear(s) on certificates for
Original Capital Securities or on a security position listing, or by person(s)
authorized to become registered holder(s) by endorsement and documents
transmitted with this Notice of Guaranteed Delivery. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer or other
person acting in a fiduciary or representative capacity, such person must set
forth his or her full title below.
Please print name(s) and address(es):
Name(s): _______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
Capacity: ______________________________________________________________________
Address(es): ___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
-4-
<PAGE>
GUARANTEE
(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 Original
Capital Securities tendered hereby in proper form for transfer, or confirmation
of the book-entry transfer of such Original Capital Securities to the Exchange
Agent's account at The Depository Trust Company, 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 three business days
after the date of execution of this Notice of Guaranteed Delivery.
The undersigned acknowledges that it must deliver the Letter(s) of
Transmittal and the Original 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
-------------------------- -----------------------------
Address Title
-------------------------- -----------------------------
Zip Code (Please Type or Print)
Area Code and Telephone No.________________ Dated:_____________________
NOTE: DO NOT SEND CERTIFICATES FOR ORIGINAL CAPITAL SECURITIES WITH THIS
FORM. CERTIFICATES FOR ORIGINAL CAPITAL SECURITIES SHOULD ONLY BE SENT
WITH YOUR LETTER OF TRANSMITTAL.
-5-
<PAGE>
Exhibit 99.3
September , 1997
The First National Bank of Chicago
One First National Plaza
Chicago, Illinois 60670
Ladies and Gentlemen:
Banknorth Group, Inc., a Delaware corporation, as Sponsor (the
"Corporation"), and Banknorth Capital Trust I, a trust formed under the laws of
the State of Delaware (the "Trust"), hereby appoint THE FIRST NATIONAL BANK OF
CHICAGO to act as exchange agent (the "Exchange Agent") in connection with an
exchange offer by the Corporation and the Trust to exchange up to and including
$30,000,000 aggregate Liquidation Amount of the Trust's 10.52% Capital
Securities, Series B (the "Exchange, Capital Securities"), which have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
for a like aggregate Liquidation Amount of the Trust's outstanding 10.52%
Capital Securities, Series A (the "Original Capital Securities"). The terms and
conditions of the exchange offer are set forth in a Prospectus dated , 1997 (as
the same may be amended or supplemented from time to time, the "Prospectus") and
in the related Letter of Transmittal, which together constitute the "Exchange
Offer." The registered holders of the Original Capital Securities and the
Exchange Capital Securities (the "Capital Securities") are hereinafter referred
to as the "Holders." Capitalizedterms used herein and not defined shall have the
respective meanings assigned thereto in the Prospectus.
The Exchange Offer is expected to be commenced by the Trust on or about
, 1997. The Letter of Transmittal accompanying the Prospectus (or, in
the case of book-entry securities, the ATOP system) is to be used by the Holders
of the Original Capital Securities to accept the Exchange Offer and contains
instructions with respect to (i) the delivery of certificates for Original
Capital Securities tendered in connection therewith and (ii) the book-entry
transfer of Original Capital Securities to the Exchange Agent's account.
The Exchange Offer shall expire at 5:00 p.m. New York City time, on ,
1997, or on such later date or time to which the Trust may extend the Exchange
Offer from time to time by giving oral (to be confirmed in writing) or written
notice to the Exchange Agent before 9:00 a.m., New York City time, on the
business day following the previously scheduled Expiration Date.
The Trust expressly reserves the right to amend or terminate the
Exchange Offer, and not to accept for exchange and Original Capital Securities
not theretofore accepted for exchange, based
2
<PAGE>
upon any conditions of the Exchange Offer described in the Prospectus. The Trust
will give oral (to be confirmed in writing) or written notice of any amendment,
termination or nonacceptance of Original Capital Securities to the Exchange
Agent promptly after any amendment, termination or nonacceptance.
On the basis of the representations, warranties and agreements of the
Corporation, the Trust and the Exchange Agent contained herein and subject to
the terms and conditions hereof, the following sets forth the agreement between
the Corporation, the Trust and the Exchange Agent for the Exchange Offer:
1. APPOINTMENT AND DUTIES AS EXCHANGE AGENT.
a. The Corporation and the Trust hereby authorize and appoint The First
National Bank of Chicago to act as Exchange Agent in connection with the
Exchange Offer and The First National Bank of Chicago agrees to act as Exchange
Agent in connection with the Exchange Offer. As Exchange Agent, The First
National Bank of Chicago will perform those services as are specifically set
forth in the section of the Prospectus captioned "The Exchange Offer" and as are
outlined herein.
b. The Corporation and the Trust acknowledge and agree that The First
National Bank of Chicago has been retained pursuant to this Agreement to act
solely as Exchange Agent in connection with the Exchange Offer, and in such
capacity, the Exchange Agent shall perform such duties in good faith.
c. The Exchange Agent will establish an account with respect to the
Original Capital Securities at The Depository Trust Company ("DTC") for the
purposes of the Exchange Offer within two business days after the date of the
Prospectus, and any financial institution that is a participant in DTC's system
may make book-entry delivery of the Original Capital Securities by causing DTC
to transfer such Original Capital Securities into the Exchange Agent's account
in accordance with DTC's procedure for such transfer.
d. The Exchange Agent will examine each of the Letters of Transmittal
and certificates for Original Capital Securities and any book-entry
confirmations and any other documents delivered or mailed to the Exchange Agent
by or for Holders of the Original Capital Securities to ascertain whether: (i)
the Letters of Transmittal and any such other documents are duly executed and
properly completed in accordance with the instructions set forth therein and
that such book-entry confirmations are in due and proper form and contain the
information required to be set forth therein, (ii) the Original Capital
Securities have otherwise been properly tendered, and (iii) Holders have
provided their correct Tax Identification Number or required certification.
Determination of all questions as to validity, form, eligibility and acceptance
for exchange of any Original Capital Securities shall be made by
3
<PAGE>
the Corporation or the Trust, whose determination shall be final and binding. In
each case where the Letters of Transmittal or any other documents have been
improperly completed or executed or where book-entry confirmations are not in
due and proper form or omit certain information, or any of the certificates for
Original Capital Securities are not in proper form for transfer or some other
irregularity in connection with the tender of the Original Capital Securities
exists, the Exchange Agent will endeavor to advise the tendering Holders of the
irregularity and to take any other action may be necessary or advisable as to
cause such irregularity to be corrected. Notwithstanding the foregoing, the
Exchange Agent shall not incur any liability for failure to give any such
notification.
e. With the approval of any Administrative Trustee of the Trust or any
person designated in writing by the Corporation (a "Designated Officer") (such
approval, if given orally, to be confirmed in writing) or any other party
designated by any Administrative Trustee or Designated Officer, the Exchange
Agent is authorized to waive any irregularities in connection with any tender of
Original Capital Securities pursuant to the Exchange Offer.
f. Tenders of Original Capital Securities may be made only as set forth
in the Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer" and Original Capital Securities shall be considered properly
tendered only when tendered in accordance with the procedures set forth therein.
Notwithstanding the provisions of this paragraph, Original Capital Securities
which any Administrative Trustee or Designated Officer shall approve (such
approval, if given orally, to be confirmed in writing) as having been properly
tendered shall be considered to be properly tendered.
g. The Exchange Agent shall advise the Corporation and the Trust with
respect to any Original Capital Securities received after 5:00 p.m., New York
City time, on the Expiration Date and accept their instructions with respect to
disposition of such Original Capital Securities.
h. The Exchange Agent shall accept tenders:
(a) in cases where the Original Capital Securities are
registered in two or more names only if signed by all named
Holders;
(b) in cases where the signing person (as indicated on the
Letter of Transmittal) is acting in a fiduciary or a representative
capacity only when proper evidence of such person's authority so to act
is submitted; and
4
<PAGE>
(c) from persons other than the Holder of Original Capital
Securities provided that customary transfer requirements, including any
applicable transfer taxes, are fulfilled.
The Exchange Agent shall accept partial tenders of Original Capital
Securities where so indicated and as permitted in the Letter of Transmittal and
deliver certificates for Original Capital Securities to the transfer agent for
split-up and return any untendered Original Capital Securities or Original
Capital Securities which have not been accepted by the Corporation and the Trust
to the Holder (or such other person as may be designated in the Letter of
Transmittal) as promptly as practicable after expiration or termination of the
Exchange Offer.
i. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Trust will notify the Exchange Agent (such notice if given orally, to
be confirmed in writing) of its acceptance, promptly after the Expiration Date,
of all Original Capital Securities properly tendered and the Exchange Agent, on
behalf of the Trust, will exchange such Original Capital Securities for Exchange
Capital Securities and cause such Original Capital Securities to be canceled.
Delivery of Exchange Capital Securities will be made on behalf of the Trust by
the Exchange Agent at the rate of $1,000 Liquidation Amount of Original Capital
Securities tendered promptly after notice (such notice if given orally, to be
confirmed in writing) of acceptance of said Original Capital Securities by the
Trust; provided, however, that in all cases, Original Capital Securities
tendered pursuant to the Exchange Offer will be exchanged only after timely
receipt by the Exchange Agent of certificates for such Original Capital
Securities (or confirmation of book-entry transfer into the Exchange Agent's
account at DTC), a properly completed and duly executed Letter of Transmittal
(or facsimile thereof) or Agent's Message in lieu thereof), with any required
signature guarantees and any other required documents. You shall issue Exchange
Capital Securities only in Liquidation Amounts of $100,000 or any integral
multiple of $1,000 in excess thereof.
j. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and the conditions set forth in the Prospectus and the
Letter of Transmittal, Original Capital Securities tendered pursuant to the
Exchange Offer may be withdrawn at any time on or prior to the Expiration Date.
k. The Trust shall not be required to exchange any Original Capital
Securities tendered if any of the conditions set forth in the Exchange Offer are
not met. Notice of any decision by the Corporation and the Trust not to exchange
any Original Capital Securities tendered shall be given by the Corporation or
the Trust orally (and confirmed in writing) to the Exchange Agent.
5
<PAGE>
l. If, pursuant to the Exchange Offer, the Corporation and the Trust do
not accept for exchange all or part of the Original Capital Securities tendered
because of an invalid tender, the occurrence of certain other events set forth
in the Prospectus under the caption "The Exchange Offer--Conditions to the
Exchange Offer" or otherwise, the Exchange Agent shall promptly after the
expiration or termination of the Exchange Offer return such certificates for
unaccepted Original Capital Securities (or effect appropriate book-entry
transfer), together with any related required documents and the Letters of
Transmittal relating thereto that are in the Exchange Agent's possession, to the
persons who deposited such certificates.
m. Certificates for reissued Original Capital Securities, unaccepted
Original Capital Securities or for Exchange Capital Securities shall be
forwarded by (a) first-class certified mail, return receipt requested under a
blanket surety bond obtained by the Exchange Agent protecting the Exchange
Agent, the Corporation and the Trust from loss or liability arising out of the
non-receipt or non-delivery or such certificates or (b) by registered mail
insured by the Exchange Agent separately for the replacement value of each such
certificate.
n. The Exchange Agent is not authorized to pay or offer to pay any
concessions, commissions or solicitation fees to any broker, dealer, commercial
bank, trust company or other persons or to engage or use any person to solicit
tenders.
o. As Exchange Agent, The First National Bank of Chicago:
(i) shall have no duties or obligations other than those
specifically set forth in the section of the Prospectus captioned "The
Exchange Offer," the Letter of Transmittal or herein or as may be
subsequently agreed to in writing;
(ii) will make no representations and will have no
responsibilities as to the validity, value or genuineness of any of the
certificates for the Original Capital Securities deposited pursuant to
the Exchange Offer, and will not be required to and will make no
representation as to the validity, value or genuineness of the Exchange
Offer;
(iii) shall not be obligated to take any legal action
hereunder which might in the Exchange Agent's reasonable judgment
involve any expense or liability, unless the Exchange Agent shall have
been furnished with reasonable indemnity;
(iv) may reasonably rely on and shall be protected in acting
in reliance upon any certificate, instrument, opinion, notice, letter,
telegram or other document or security delivered to the Exchange Agent
and reasonably believed by the
6
<PAGE>
Exchange Agent to be genuine and to have been signed by the
proper party or parties;
(v) may reasonably act upon any tender, statement, request,
agreement or other instrument whatsoever not only as to its due
execution and validity and effectiveness of its provisions, but also as
to the truth and accuracy of any information contained therein, which
the Exchange Agent believes in good faith to be genuine and to have
been signed or represented by a proper person or persons;
(vi) may rely on and shall be protected in acting upon written
or oral instructions from any Administrative Trustee or Designated
Officer;
(vii) may consult with its own counsel with respect to any
questions relating to the Exchange Agent's duties and responsibilities
and the advice of such counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to
be taken by the Exchange Agent hereunder in good faith and in
accordance with the advice or opinion of such counsel;
(viii) shall not advise any person tendering Original Capital
Securities pursuant to the Exchange Offer as to whether to tender or
refrain from tendering all or any portion of its Original Capital
Securities or as to the market value, decline or appreciation in market
value of any Original Capital Securities or as to the market value of
the Exchange Capital Securities; and
(ix) The Exchange Agent shall take such action as may from
time to time be requested by the Corporation or the Trust to furnish
copies of the Prospectus, Letter of Transmittal and the Notice of
Guaranteed Delivery, or such other forms as may be approved from time
to time by the Corporation and the Trust, to all persons requesting
such documents and to accept and comply with telephone requests for
information relating to the procedures for accepting (or withdrawing
from) the Exchange Offer. The Corporation and the Trust will furnish
you with copies of such documents at your request.
p. The Exchange Agent shall advise by facsimile transmission or
telephone and promptly thereafter confirm in writing to the Corporation and the
Trust and such other persons as the Corporation and the Trust may request, daily
(and more frequently during the week immediately preceding the Expiration Date
and if otherwise requested), up to and including the Expiration Date, the
Aggregate Liquidation Amount of Original Capital Securities which have been
tendered pursuant to the Exchange Offer and the items received by the Exchange
Agent pursuant to the Exchange Offer and this Agreement, reporting separately
and cumulatively as to items
7
<PAGE>
properly received and items improperly received. In addition, the Exchange Agent
will also provide, and cooperate in making available to the Corporation and the
Trust or any such other persons as requested from time to time, such other
information in its possession as the Corporation and the Trust may reasonably
request. Such cooperation shall include, without limitation, the granting by the
Exchange Agent to the Corporation and the Trust, and such persons as the
Corporation and the Trust may request, of access to those persons on the
Exchange Agent's staff who are responsible for receiving tenders, in order to
ensure that immediately prior to the Expiration Date the Corporation and the
Trust shall have received information in sufficient detail to enable the
Corporation and the Trust to decide whether to extend the Exchange Offer. The
Exchange Agent shall prepare a final list of all persons whose tenders were
accepted, the aggregate Liquidation Amount of Original Capital Securities
tendered and the aggregate Liquidation Amount of Original Capital Securities
accepted and deliver said list to the Corporation and the Trust.
q. Letters of Transmittal, book-entry confirmation and Notices of
Guaranteed Delivery shall be stamped by the Exchange Agent as to the date and
time of receipt thereof and shall be preserved by the Exchange Agent for a
period of time at least equal to the period of time the Exchange Agent preserves
other records pertaining to the transfer of securities, or one year, whichever
is longer, and thereafter shall be delivered by the Exchange Agent to the
Corporation and the Trust. The Exchange Agent shall dispose of unused Letters of
Transmittal and other surplus materials by returning them to the Corporation or
the Trust.
r. The Exchange Agent hereby expressly waives any lien, encumbrance or
right of set-off whatsoever that the Exchange Agent may have respect to funds
deposited with it for the payment of transfer taxes by reasons of amounts, if
any, borrowed by the Corporation or the Trust, of any of its or their
subsidiaries or affiliates pursuant to any loan or credit agreement with the
Exchange Agent or for compensation owed to the Exchange Agent hereunder or for
any other matter.
s. The Exchange Agent hereby acknowledges receipt of the Prospectus and
the Letter of Transmittal and the Notice of Guaranteed Delivery and further
acknowledges that it has examined each of them. Any inconsistency between this
Agreement, on the one hand, and the Prospectus, the Letter of Transmittal and
the Notice of Guaranteed Delivery (as they may be amended or supplemented from
time to time), on the other hand, shall be resolved in favor of the latter three
documents, except with respect to the duties, liabilities and indemnification of
the Exchange Agent which shall be controlled by this Agreement.
8
<PAGE>
2. COMPENSATION
For services rendered as Exchange Agent hereunder, the Exchange Agent
shall be entitled to such compensation as is set forth on Schedule I attached
hereto.
3. INDEMNIFICATION
a. The Trust hereby agrees to indemnify and hold harmless the Exchange
Agent against and from any and all costs, losses, liabilities and expenses
(including reasonable counsel fees and disbursements) arising out of or in
connection with any act, omission, delay or refusal made by the Exchange Agent
in reliance upon any signature, endorsement, assignment, certificate, order,
request, notice, instruction or other instrument or document reasonably believed
by the Exchange Agent to be valid, genuine and sufficient and in accepting any
tender or effecting any transfer of Original Capital Securities reasonably
believed by the Exchange Agent in good faith to be authorized, and in delaying
or refusing in good faith to accept any tenders or effect any transfer of
Original Capital Securities. Anything in this Agreement to the contrary
notwithstanding, neither the Corporation nor the Trust shall be liable for
indemnification or otherwise for any loss, liability, cost or expense to the
extent arising out of the Exchange Agent's bad faith, negligence or willful
misconduct. In no case shall the Trust be liable under this indemnity with
respect to any claim against the Exchange Agent until the Trust shall be
notified by the Exchange Agent, by letter, of the written assertion of a claim
against the Exchange Agent or of any other action commenced against the Exchange
Agent, promptly after the Exchange Agent shall have received any such written
assertion or notice of commencement of action. The Trust shall be entitled to
participate at its own expense in the defense of any such claim or other action,
and, if the Trust so elects, the Trust may assume the defense of any pending or
threatened action to enforce any such claim. In the event that the Trust shall
assume the defense of any such suit or threatened action in respect of which
indemnification may be sought hereunder, the Trust shall not be liable for the
fees and expenses incurred thereafter of any additional counsel retained by the
Exchange Agent so long as the Exchange Agent consents to the Trust's retention
of counsel, which consent may not be unreasonably withheld; provided, however,
that the Trust shall not be entitled to assume the defense of any such action if
the named parties to such action include the Corporation or the Trust and the
Exchange Agent and representation of the parties by the same legal counsel
would, in the written opinion of counsel for the Exchange Agent, be
inappropriate due to actual or potential conflicting interests among them. It is
understood that neither the Corporation nor the Trust shall be liable under this
paragraph for the fees and disbursements of more than one legal counsel for the
Exchange Agent. In the event that the Trust shall assume the defense of any such
suit with counsel reasonably acceptable to the Exchange Agent,
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<PAGE>
the Trust shall not thereafter be liable for the fees and expenses of any
counsel retained by the Exchange Agent.
b. The Exchange Agent agrees that, without the prior written consent of
the Trust, it will not settle, compromise or consent to the entry of any
judgment in any pending or threatened claim, action or proceeding in respect of
which indemnification could be sought in accordance with the indemnification
provision of this Agreement (whether or not the Exchange Agent, the Corporation
and the Trust or any of their directors, officers and controlling persons is an
actual or potential party to such claim, action or proceeding), unless such
settlement, compromise or consent includes an unconditional release of the
Corporation and the Trust and its directors, officers and controlling persons
from all liability arising out of such claim, action or proceeding.
4. TAX INFORMATION
a. The Exchange Agent shall arrange to comply with all requirements
under the tax laws of the United States, including those relating to missing Tax
Indemnification Numbers, and shall file any appropriate reports with the
Internal Revenue Service. The Corporation and the Trust understand that the
Exchange Agent is required, in certain instances,to deduct 31% with respect to
interest paid on the Exchange Capital Securities and proceeds from the sale,
exchange, redemption or retirement of the Exchange Capital Securities from
Holders who have not supplied their correct Taxpayer Identification Number or
required certification. Such funds will be turned over to the Internal Revenue
Service in accordance with applicable regulations. The Exchange Agent shall
notify the Corporation and the Trust of any Holder who has failed to supply such
Taxpayer Identification Number or certification.
b. The Exchange Agent shall notify the Trust of the amount of any
transfer taxes payable in respect of the exchange of Original Capital Securities
and, upon receipt of written approval from the Trust, the Exchange Agent shall
deliver or cause to be delivered, in a timely manner to each governmental
authority to which any transfer taxes are payable in respect of the exchange of
Original Capital Securities, its check in the amount of all transfer taxes so
payable, and the Trust shall reimburse the Exchange Agent for the amount of any
and all transfer taxes payable in respect of the exchange of Original Capital
Securities; provided, however, that the Exchange Agent shall reimburse the trust
for amounts refunded to the Exchange Agent in respect of you payment of any such
transfer taxes, as such time as such refund is received by the Exchange Agent.
5. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York
applicable to contracts executed in and to be performed in that
state without regard to conflicts of laws principles.
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<PAGE>
6. NOTICES. Any communication or notice provided for hereunder shall be in
writing and shall be given (and shall be deemed to have been given upon receipt)
by delivery in person, telecopy, or overnight delivery or by registered or
certified mail (postage prepaid, return receipt requested) to the applicable
party at the address indicated below:
If to the Trust:
Banknorth Capital Trust I
c/o Banknorth Group, Inc.
300 Financial Plaza
P.O. Box 5420
Burlington, Vermont 05401
Telephone: (802)658-2492
Telecopy: (802)860-5437
Attention: Neal E. Robinson
If to the Exchange Agent:
The First National Bank of Chicago
153 West 51st Street, 5th Floor
New York, New York 10019
Telephone: 212-373-1191
Telecopy: 212-373-1383
Attention: Melissa G. Weisman
or, as to each party, at such other address as shall be designated by such party
in a written notice complying as to delivery with the terms of this Section.
7. PARTIES IN INTEREST. This Agreement shall be binding upon and inure solely to
the benefit of each party hereto and their successors and assigns and noting in
this Agreement, express or implied, is intended to or shall confer upon any
other person any right, benefit or remedy of any nature whatsoever under or by
reason of this Agreement. Without limitation to the foregoing, the parties
hereto expressly agree that no Holder of Original Capital Securities or Exchange
Capital Securities shall have any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.
8. COUNTERPARTS; SEVERABILITY. This Agreement may be executed in one or more
counterparts, and each of such counterparts shall together constitute one and
the same agreement. If any term or other provision of this Agreement or the
application thereto is invalid, illegal or incapable of being enforced by any
rule of law, or public policy, all other provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the agreements contained herein is not affected in any manner
adverse to any party. Upon such determination that any term or provision or the
application thereof
11
<PAGE>
is invalid, illegal or unenforceable, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that the
agreements contained herein may be performed as originally contemplated to the
fullest extent possible.
9. CAPTIONS. The descriptive headings contained in this
Agreement are included for convenience of reference only and shall
not affect in any way the meaning or interpretation of this
Agreement.
10. ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the
entire understanding of the parties hereto with respect to the
subject matter hereof. This Agreement may not be amended or
modified nor may any provision hereof be waived except in writing
signed by each party to be bound thereby.
11. TERMINATION. This Agreement shall terminate upon the earlier of (a) the 90th
day following the expiration, withdrawal, or termination of the Exchange Offer,
(b) the close of business on the date of actual receipt of written notice by the
Exchange Agent from the Corporation and the Trust stating that this Agreement is
terminated, (c) one year following the date of this Agreement, or (d) the time
and date on which this Agreement shall be terminated by mutual consent of the
parties hereto. Notwithstanding the foregoing, Paragraphs 2, 3 and 4 shall
survive termination of this Agreement.
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<PAGE>
Kindly indicate the Exchange Agent's acceptance of the foregoing
provisions by signing in the space provided below for that purpose and returning
to the Corporation a copy of this Agreement so signed, whereupon this Agreement
shall constitute a binding agreement among the Exchange Agent, the Corporation
and the Trust.
Very truly yours,
BANKNORTH GROUP, INC.
By:___________________________________
Name: William H. Chadwick
Title: President and
Chief Executive Officer
BANKNORTH CAPITAL TRUST I
By:___________________________________
Name: Neal E. Robinson
Title: Administrative Trustee
Accepted and agreed to as
of the date first written
above:
THE FIRST NATIONAL BANK OF CHICAGO
By:___________________________________
Name: Richard D. Manella
Title: Vice President and
Senior Counsel
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<PAGE>
SCHEDULE I
THE FIRST NATIONAL BANK OF CHICAGO
FEE SCHEDULE
EXCHANGE AGENT SERVICES
BANKNORTH CAPITAL TRUST I
________________________________________________________________________________
I. Exchange Agency
A fee for the receipt of exchanged 10.52% Capital Securities, Series A,
of Banknorth Capital Trust I will be charged at $6.50 per Letter of
Transmittal. The total charge will be subject to a minimum of $2,000
and maximum of $5,000.
This fee covers examination and execution of all required
documentation, receipt of transmittal letters, reporting as required to
the Company and communication with DTC.
II. Miscellaneous
Fees for services not specifically covered in this schedule will be
assessed in amounts commensurate with the services rendered.
[ ], 1997
<PAGE>
Exhibit 99.4
BANKNORTH CAPITAL TRUST I
Offer for all Outstanding
10.52% Capital Securities, Series A
in Exchange for
10.52% Capital Securities, Series B
To: Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Banknorth Capital Trust I (the "Trust") is offering, upon and subject to
the terms and conditions set forth in a prospectus dated September , 1997 (as
the same may be amended or supplemented from time to time, the "Prospectus"),
and the enclosed letter of transmittal (the "Letter of Transmittal"), to
exchange (the "Exchange Offer") its 10.52% Capital Securities, Series B (the
"Exchange Capital Securities") for any and all of its outstanding 10.52% Capital
Securities, Series A (the "Original Capital Securities"). The Exchange Offer is
being made in order to satisfy certain obligations of the Trust and Banknorth
Group, Inc. (the "Corporation") contained in the Registration Rights Agreement,
dated as of May 1, 1997, among the Trust, the Corporation and Sandler O'Neill &
Partners, L.P.
We are requesting that you contact your clients for whom you hold Original
Capital Securities regarding the Exchange Offer. For your information and for
forwarding to your clients for whom you hold Original Capital Securities
registered in your name or in the name of your nominee, or who hold Original
Capital Securities registered in their own names, we are enclosing the following
documents:
1. The Prospectus dated September , 1997;
2. The Letter of Transmittal for your use and for the information (or
the use, where relevant) of your clients;
3. A Notice of Guaranteed Delivery to be used to accept the Exchange
Offer if certificates for Original Capital Securities are not
immediately available or time will not permit all required documents
to reach the Exchange Agent prior to the Expiration Date (as defined
below) or if the procedure for book-entry transfer cannot be
completed on a timely basis;
4. A form of letter which may be sent to your clients for whose account
you hold Original Capital Securities registered in your name or the
name of your nominee, with space provided for obtaining such
clients' instructions with regard to the Exchange Offer; and
5. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
Your prompt action is requested. The Exchange Offer will expire at 5:00
p.m, New York City time, on [ ], 1997, or on such later date or time to which
the Corporation or the Trust may extend the Exchange Offer (the "Expiration
Date"). The Original Capital Securities tendered pursuant to the Exchange Offer
may be withdrawn at any time before the Expiration Date.
<PAGE>
To participate in the Exchange Offer, a duly executed and properly
completed Letter of Transmittal (or facsimile thereof), with any required
signature guarantees and any other required documents, should be sent to the
Exchange Agent and certificates representing the Original Capital Securities
should be delivered to the Exchange Agent, all in accordance with the
instructions set forth in the Letter of Transmittal and the Prospectus.
If holders of Original Capital Securities wish to tender, but it is
impracticable for them to forward their certificates for Original Capital
Securities prior to the expiration of the Exchange Offer or to comply with the
book-entry transfer procedures on a timely basis, a tender may be effected by
following the guaranteed delivery procedures described in the Prospectus under
"The Exchange Offer--Procedures for Tendering Original Capital
Securities--Guaranteed Delivery."
The Trust will, upon request, reimburse brokers, dealers, commercial banks
and trust companies for reasonable and necessary costs and expenses incurred by
them in forwarding the Prospectus and the related documents to the beneficial
owners of Original Capital Securities held by them as nominee or in a fiduciary
capacity. The Trust will pay or cause to be paid all stock transfer taxes
applicable to the exchange of Original Capital Securities pursuant to the
Exchange Offer, except as set forth in Instruction 6 of the Letter of
Transmittal.
Any inquiries you may have with respect to the Exchange Offer, or requests
for additional copies of the enclosed materials, should be directed to The First
National Bank of Chicago, the Exchange Agent for the Original Capital
Securities, at its address and telephone number set forth on the front of the
Letter of Transmittal.
Very truly yours,
BANKNORTH CAPITAL TRUST I
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY
PERSON AS AN AGENT OF THE TRUST OR THE EXCHANGE AGENT, OR AUTHORIZE YOU OR ANY
OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF EITHER OF
THEM WITH RESPECT TO THE EXCHANGE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN
THE PROSPECTUS OR THE LETTER OF TRANSMITTAL.
Enclosures
-2-
Exhibit 99.5
BANKNORTH CAPITAL TRUST I
Offer for all Outstanding
10.52% Capital Securities, Series A
in Exchange for
10.52% Capital Securities, Series B
To Our Clients:
Enclosed for you consideration is a prospectus dated September , 1997 (as
the same may be amended or supplemented from time to time, the "Prospectus"),
and the related letter of transmittal (the "Letter of Transmittal"), relating to
the offer (the "Exchange Offer") of Banknorth Capital Trust I (the "Trust") and
Banknorth Group, Inc. (the "Corporation") to exchange the Trust's 10.52% Capital
Securities, Series B (the "Exchange Capital Securities") for any and all of the
Trust's outstanding 10.52% Capital Securities, Series A (the "Original Capital
Securities"), upon the terms and subject to the conditions described in the
Prospectus. The Exchange Offer is being made in order to satisfy certain
obligations of the Trust and the Corporation contained in the Registration
Rights Agreement, dated as of May 1, 1997, among the Trust, the Corporation and
Sandler O'Neill & Partners, L.P.
This material is being forwarded to you as the beneficial owner of the
Original Capital Securities carried by us in your account but not registered in
your name. A tender of such Original Capital Securities may only be made by us
as the holder of record and pursuant to your instructions.
Accordingly, we request instructions as to whether you wish us to tender
on your behalf the Original Capital Securities held by us for your account,
pursuant to the terms and conditions set forth in the enclosed Prospectus and
Letter of Transmittal.
Your instructions should be forwarded to us as promptly as possible in
order to permit us to tender the Original Capital Securities on your behalf in
accordance with the provisions of the Exchange Offer. The Exchange Offer shall
expire at 5:00 p.m., New York City time, on [________], 1997, or on such later
date or time to which the Corporation or the Trust may extend the Exchange
Offer. Any Original Capital Securities tendered pursuant to the Exchange Offer
may be withdrawn at any time before the Expiration Date.
Your attention is directed to the following:
1. The Exchange Offer is for any and all Original Capital Securities.
2. The Exchange Offer is subject to certain conditions set forth in the
Prospectus in the section captioned "The Exchange Offer--Conditions
to the Exchange Offer".
3. Any transfer taxes incident to the transfer of Original Capital
Securities from the holder to the Corporation will be paid by the
Corporation, except as otherwise provided in the Instructions in the
Letter of Transmittal.
4. The Exchange Offer expires at 5:00 p.m., New York City time, on [ ],
1997, or on such later date or time to which the Corporation or the
Trust may extend the Exchange Offer.
If you wish to have us tender your Original Capital Securities, please so
instruct us by completing, executing and returning to us the instruction form on
the back of this letter. The Letter of Transmittal is furnished to you for
information only and may not be used directly by you to tender Original Capital
Securities.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE EXCHANGE OFFER
The undersigned acknowledge(s) receipt of your letter and the enclosed
material referred to therein relating to the Exchange Offer made by Banknorth
Capital Trust I with respect to its Original Capital Securities.
This will instruct you to tender the Original Capital Securities held by
you for the account of the undersigned, upon and subject to the terms and
conditions set forth in the Prospectus and the related Letter of Transmittal.
Please tender the Original Capital Securities held by you for my account
as indicated below:
Aggregate Liquidation Amount at Maturity
of Original Capital Securities Tendered
---------------------------------------
10.52% Capital Securities, Series A
|_| Please do not tender any Original Capital Securities held by you for my
account.
Dated: _________________________, 1997 _________________________________________
-----------------------------------------
Signature(s)
-----------------------------------------
-----------------------------------------
Please print name(s) here
-----------------------------------------
-----------------------------------------
-----------------------------------------
Addresses
-----------------------------------------
Area code and telephone number
-2-
<PAGE>
---------------------------------------------------
Tax Identification or Social Security number(s)
None of the Original Capital Securities held by us for your account will
be tendered unless we receive written instructions from you to do so. Unless a
specific contrary instruction is given in the space provided, your signature(s)
hereon shall constitute an instruction to us to tender all the Original Capital
Securities held by us for your account.
-3-
