Filed pursuant to Rule 424(b)(1)
Registration No. 333-83797
333-75937
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED AUGUST 4, 1999)
1,200,000 SHARES
BANK UNITED CORP.
SERIES A PREFERRED STOCK
- --------------------------------------------------------------------------------
Bank United Corp. is selling 1,200,000 shares of its Series A preferred stock.
All of the shares of preferred stock will have a liquidation preference of $50
per share. In this prospectus supplement, we refer to Bank United Corp. as
"Bank United".
Dividends on the preferred stock are cumulative from the date of issue and will
be payable on February 15, May 15, August 15 and November 15 of each year,
beginning on November 15, 1999, at the annual rate of 7.55% through the dividend
payment date on February 15, 2000, and thereafter at the annual rate of 8.55%.
The preferred stock is redeemable at any time on or after February 15, 2000 at
100% of its liquidation preference plus accrued dividends to the redemption
date. The preferred stock will be subject to mandatory redemption in full on
August 15, 2004 at the same price.
PER SHARE TOTAL
--------- -------------
Public Offering Price................... $ 50.00 $ 60,000,000
Underwriting Discount................... $ 0.70 $ 840,000
Proceeds to Bank United (before
expenses)............................. $ 49.30 $ 59,160,000
Any accumulated dividend payments on the preferred stock from August 10, 1999
should be added to the Public Offering Price.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the accompanying prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.
Lehman Brothers expects to deliver the preferred stock through the book entry
system of The Depository Trust Company on or about August 10, 1999.
- --------------------------------------------------------------------------------
LEHMAN BROTHERS
August 6, 1999
<PAGE>
ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus supplement and the accompanying prospectus contain
information about Bank United and about the preferred stock. They also refer to
information contained in other documents filed by Bank United with the
Securities and Exchange Commission. References to this prospectus supplement or
the prospectus also mean the information contained in those other documents. If
this prospectus supplement is inconsistent with the prospectus or the documents
incorporated herein by reference, rely on this prospectus supplement.
You should rely on the information in this prospectus supplement or the
accompanying prospectus or in documents that are incorporated by reference into
the prospectus. Neither Bank United nor the underwriter has authorized anyone to
provide any different or additional information. We are not making an offer of
the preferred stock in any jurisdiction where the offer is not permitted. You
should not assume that information in these documents is correct or complete
after the date of this prospectus supplement.
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
----
Prospectus Supplement Summary........ S-3
Use of Proceeds...................... S-10
Capitalization....................... S-10
Description of the Preferred Stock... S-11
Book-Entry Procedures and
Settlement......................... S-13
Underwriting......................... S-15
United States Federal Income Tax
Consequences....................... S-16
Legal Matters........................ S-17
Experts.............................. S-17
PROSPECTUS
PAGE
----
Risk Factors......................... 1
Use of Proceeds...................... 4
Ratios of Earnings to Fixed Charges
and Earnings to Combined Fixed
Charges and Preferred Dividends.... 4
Bank United Corp. ................... 5
Bank United Capital Trust............ 6
Description of Offered Securities.... 8
Relationship Among the Trust
Preferred Securities, the Trust
Preferred Securities Guarantee and
the Junior Subordinated Notes Held
by Bank United Capital Trust....... 33
Selling Stockholders................. 34
Plan of Distribution................. 35
Legal Matters........................ 36
Experts.............................. 36
Forward-Looking Information.......... 36
About this Prospectus................ 37
Where You Can Find More
Information........................ 38
<PAGE>
PROSPECTUS SUPPLEMENT SUMMARY
The following summary is qualified by the more detailed information and the
consolidated financial statements of Bank United appearing elsewhere in this
prospectus supplement or the accompanying prospectus or incorporated by
reference in the accompanying prospectus.
BANK UNITED CORP.
We are a broad-based financial services provider to consumers and
businesses in Texas and selected regional markets throughout the United States.
At June 30, 1999, we operated a 144-branch community banking network serving
nearly 284,000 households, as well as 18 commercial banking offices in 15 states
across the country. As of June 30, 1999, we were the largest publicly traded
financial institution headquartered in Texas, with $15.4 billion in assets, $7.2
billion in deposits and $732.8 million in stockholders' equity. Our address is
3200 Southwest Freeway, Suite 2600, Houston, Texas 77027, and our telephone
number is (713) 543-6500.
Our bank subsidiary's capital levels at June 30, 1999 and September 30,
1998 qualified it as "well-capitalized," the highest of five categories under
applicable regulatory definitions. Our bank subsidiary's capital ratios at June
30, 1999 and September 30, 1998 and the applicable regulatory capital
requirements were as follows:
<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30, CAPITAL ADEQUACY WELL-CAPITALIZED
1999 1998 REQUIREMENT REQUIREMENT
--------- -------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Tangible capital..................... 6.60% 6.75% 1.50% --
Core/Leverage capital................ 6.62% 6.77% 3.00% 5.00%
Tier 1 capital....................... 9.29% 9.97% -- 6.00%
Total risk-based capital............. 11.24% 10.48% 8.00% 10.00%
</TABLE>
RECENT DEVELOPMENTS
The following are selected financial data for the periods indicated. The
selected consolidated financial data as of June 30, 1999 and for the nine months
ended June 30, 1999 and 1998, respectively, are taken from our unaudited
consolidated financial statements, which in our opinion contain all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of the results for these periods. These results of operations for
the nine months ended June 30, 1999 are not necessarily indicative of the
results of operations that may be obtained for the entire fiscal year. The
selected consolidated financial data as of September 30, 1998 are taken from
financial statements audited by Deloitte & Touche LLP, independent auditors,
which are incorporated into this prospectus supplement by reference.
<TABLE>
<CAPTION>
AT AT
JUNE 30, SEPTEMBER 30,
1999 1998
----------- --------------
<S> <C> <C>
(DOLLARS IN THOUSANDS)
STATEMENT OF FINANCIAL CONDITION
DATA:
Total assets....................... $15,426,756 $ 13,664,992
Mortgage-backed securities......... 1,069,315 932,058
Loans.............................. 12,386,846 10,803,744
Deposits........................... 7,213,264 6,798,237
Borrowings......................... 7,022,728 5,814,756
Minority interest, Bank Preferred
Stock........................... 185,500 185,500
Total stockholders' equity......... 732,822 684,412
</TABLE>
S-3
<PAGE>
<TABLE>
<CAPTION>
FOR THE NINE MONTHS
ENDED JUNE 30,
-----------------------------
1999 1998
----------- --------------
<S> <C> <C>
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE DATA)
STATEMENT OF OPERATIONS DATA:
Net interest income................ $ 247,745 $ 214,589
Provision for credit losses........ 17,977 16,777
Non-interest income................ 88,563 54,110
Non-interest expense............... 172,338 138,783
Income before income taxes and
minority interest............... 145,993 113,139
Net income......................... 77,309 90,645
Net income applicable to common
shares............................. 77,309 90,645
Basic earnings per common share.... 2.45 2.87
Diluted earnings per common
share.............................. 2.40 2.80
</TABLE>
<TABLE>
<CAPTION>
AT OR FOR THE NINE MONTHS
ENDED JUNE 30,
-----------------------------
1999 1998
----------- --------------
<S> <C> <C>
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE DATA)
OTHER DATA:
Mortgage servicing
portfolio -- period end......... $30,609,155 $ 29,349,450
Common shares outstanding
Period end...................... 31,703,646 31,595,596
Average-- basic................. 31,606,979 31,595,596
Average-- diluted............... 32,239,062 32,360,747
Book value-- period end............ $ 23.11 $ 21.19
Tangible book value-- period end... 20.41 19.25
</TABLE>
<TABLE>
<CAPTION>
FOR THE NINE MONTHS
ENDED JUNE 30,
-----------------------------
1999 1998
----------- --------------
<S> <C> <C>
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE DATA)
CERTAIN RATIOS:
Return on average assets........... 0.83% 1.11%
Return on average common equity.... 14.48 19.18
Stockholders' equity to assets..... 4.75 5.11
Net yield on interest-earning
assets............................. 2.45 2.44
Efficiency ratio................... 49.93 50.23
Allowance for credit losses to net
nonaccrual loans................ 84.67 67.55
Allowance for credit losses total
loans........................... 0.51 0.46
Net loan charge-offs to average
loans........................... 0.05 0.15
Nonperforming assets to total
assets............................. 0.65 0.65
REGULATORY CAPITAL RATIOS OF THE
BANK:
Tangible capital................... 6.60 7.03
Core capital....................... 6.62 7.06
Total risk-based capital........... 11.24 10.93
</TABLE>
Net income was $77.3 million or $2.40 per diluted share for the nine months
ended June 30, 1999, compared to $90.6 million or $2.80 per diluted share for
the nine months ended June 30, 1998.
S-4
<PAGE>
Two positive income tax adjustments totalling $33.5 million recorded during the
nine months ended June 30, 1998 were the principal reasons for the decrease. Net
interest income increased 15% or $33.2 million due to higher levels of
interest-earning assets, particularly in the commercial lending businesses.
Non-interest income increased $34.5 million or 64%, due to an increase in the
servicing portfolio and the average service fee rates as well as increased
mortgage banking gains resulting from single family loan sales in the normal
course of business. Non-interest expenses increased $33.5 million, or 24%, due
primarily to higher levels of loan activity and community bank branch expansion.
Net income was $24.8 million or $0.77 per diluted share for the quarter
ended June 30, 1999, compared to $23.9 million or $0.74 per diluted share for
the quarter ended June 30, 1998. Higher levels of interest-earning assets and an
increase in the net yield to 2.57% produced a 17% or $13.0 million increase in
net interest income. Partially offsetting this increase was a $12.3 million
increase in non-interest expense, primarily due to higher levels of loan
activity and community bank branch expansion.
Total assets increased $1.8 billion to $15.4 billion at June 30, 1999 from
$13.6 billion at September 30, 1998. This increase occurred primarily due to
growth in the commercial loan portfolio. FHLB advances and higher deposit levels
were the principal source of funds used to finance this growth.
THE OFFERING
We are selling 1,200,000 shares of our Series A preferred stock in this
offering. All of the shares of preferred stock will have a liquidation
preference of $50 per share. Dividends on the preferred stock will be payable on
February 15, May 15, August 15 and November 15 of each year, beginning on
November 15, 1999, at the annual rate of 7.55% through the dividend payment date
on February 15, 2000, and thereafter at the annual rate of 8.55%. The preferred
stock is redeemable at our option at any time on or after February 15, 2000 at
100% of its liquidation preference plus accrued dividends to the redemption
date. The preferred stock will be subject to mandatory redemption in full on
August 15, 2004 at the same price. Each share of preferred stock will have the
right to vote together with our common stockholders on all matters submitted
generally to our stockholders for a vote, and will be entitled to vote
separately as a class with respect to certain matters affecting the interests of
preferred stockholders. Preferred stockholders will also be entitled to elect
two additional directors to our board if we fail to pay dividends on the
preferred stock for six quarters.
CONCURRENT OFFERING
We are also offering, in a concurrent offering, $100 million of our Premium
Income Equity SecuritiesSM ("PIESSM"). Each PIES consists of a unit comprised
of a stock purchase contract and a share of preferred stock, each issued by Bank
United. The stock purchase contract requires the holder to purchase shares of
common stock from Bank United prior to August 16, 2002. The number of shares of
common stock that each holder will be required to purchase pursuant to the stock
purchase contract will be determined based on the average closing price of the
common stock during a specified 20-day trading period. The preferred stock,
which will be pledged to secure each holder's obligations under the related
stock purchase contract, will pay dividends quarterly at the annual rate of
7.25% through August 16, 2002, and thereafter at a reset rate set through a
remarketing process. The preferred stock will be subject to mandatory redemption
on August 16, 2004 at a price equal to 100% of its liquidation preference plus
accrued dividends to the redemption date.
S-5
<PAGE>
USE OF PROCEEDS
The estimated net proceeds from the sale of the preferred stock, after
deducting underwriting discounts and estimated fees and expenses, are expected
to be approximately $59.0 million. See "Use of Proceeds" on page S-10. We
intend to use these net proceeds for general corporate purposes.
SELECTED FINANCIAL DATA OF BANK UNITED
The following selected financial data for each of the years ended September
30, 1994 through 1998 are derived from the audited consolidated financial
statements of Bank United. The following selected financial data for the six
months ended March 31, 1999 and March 31, 1998 are derived from the unaudited
consolidated financial statements of Bank United and include, in the opinion of
the management of Bank United, all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the data of those periods.
The information that appears below is only a summary and should be read in
conjunction with the consolidated financial statements, the notes to those
financial statements and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" incorporated by reference into this
prospectus supplement.
In reading the following selected financial information for Bank United,
please note the following:
o During fiscal 1997, Bank United sold some of its mortgage origination
offices. In connection with this sale, the remaining offices were
restructured or closed. The mortgage origination branches shown at March
31, 1999 and 1998 and September 30, 1998 and 1997 are wholesale mortgage
origination offices, which are currently part of the Financial Markets
Group. See "Sale of mortgage offices" and "Restructuring charges" items
in the Summary of Operations.
o In connection with its acquisition, Bank United issued to the Federal
Deposit Insurance Corporation, as manager of the Federal Savings and Loan
Insurance Corporation Resolution Trust Fund, a warrant to acquire 158,823
shares of common stock of Bank United. Payments in lieu of dividends
related to the warrant, which was redeemed in August 1996. See "Payments
in lieu of dividends" item in the Summary of Operations.
o The extraordinary loss appearing under "Extraordinary loss -- early
extinguishment of debt" in the Summary of Operations represents costs and
charges associated with the repurchase and retirement of a majority of
the senior notes of Bank United.
o Effective October 1, 1997, Bank United adopted Statement of Financial
Accounting Standard ("SFAS") No. 128, "Earnings per share," which
establishes standards for computing and presenting earnings per share
("EPS"). It requires dual presentation of basic and diluted EPS for
entities with complex capital structures. All prior period EPS data were
restated to comply with SFAS No. 128, but are not materially different.
See "Earnings per common share" item in the Summary of Operations.
o "Return on average assets" under Certain Ratios and Other Data is net
income without deduction of minority interest, divided by average total
assets.
o "Net operating expense ratio" under Certain Ratios and Other Data is
total non-interest expense, less total non-interest income, as a
percentage of average assets for each period.
o "Efficiency ratio" under Certain Ratios and Other Data is non-interest
expense excluding goodwill amortization, divided by net interest income
plus non-interest income, excluding the gain on the sale of mortgage
offices.
o Adjusting items under Certain Ratios and Other Data-Excluding Adjusting
Item are composed of the following for fiscal 1999, 1998, 1997, 1996 and
1994:
o 1999, decreased EPS $0.08: court of claims litigation expense totaling
$4.1 million, $2.6 million net of tax;
S-6
<PAGE>
o 1998, increased EPS $0.76:
(1) two positive income tax adjustments totaling $33.5 million,
(2) an increase in the commercial loan allowance of $7.8 million,
$4.9 million net of tax and
(3) provisions for the impact of higher prepayments on the single
family loan and servicing portfolios totaling $6.7 million,
$4.2 million net of tax;
o 1997, increased EPS $0.02:
(1) the gain on the sale of mortgage offices of $4.7 million, $2.9
million net of tax and
(2) an extraordinary loss on extinguishment of debt of $3.6
million, $2.3 million net of tax;
o 1996, increased EPS $2.05:
(1) a one-time SAIF assessment charge of $33.7 million, $20.7
million net of tax,
(2) compensation expense of $7.8 million, $4.8 million net of tax,
(3) charges totaling $12.5 million, $7.7 million net of tax,
related to the restructuring of and items associated with the
mortgage origination business,
(4) a contractual payment to previous minority interests of $5.9
million, and
(5) an income tax benefit of $101.7 million;
o 1994, increased EPS $1.90: an income tax benefit of $58.2 million.
<TABLE>
<CAPTION>
AT SEPTEMBER 30,
AT MARCH 31, -------------------------------------------------------------------
1999 1998 1997 1996 1995 1994
----------- ----------- ----------- ----------- ----------- -----------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
SUMMARY OF FINANCIAL CONDITION
ASSETS
Cash and cash equivalents ...................... $ 237,251 $ 228,674 $ 121,000 $ 119,523 $ 112,931 $ 76,938
Securities purchased under
agreements to resell and federal
funds sold ............................... 411,529 474,483 349,209 674,249 471,052 358,710
Securities and other investments ........... 124,373 91,350 77,809 65,693 117,094 115,126
Mortgage-backed securities, net ............ 1,168,958 932,058 1,569,705 1,657,908 2,398,263 2,828,903
Loans, net
Single family-held for
investment ........................... 4,978,688 4,686,600 5,795,179 6,113,318 7,000,303 4,144,787
Single family-held for sale ............ 1,571,433 2,149,009 697,410 256,656 406,563 253,310
Commercial ............................. 4,480,710 3,472,579 2,201,880 981,001 735,876 546,794
Consumer ............................... 576,777 495,556 300,760 168,513 117,498 101,283
Mortgage servicing rights .................. 431,746 410,868 272,214 123,392 75,097 56,677
Other assets ............................... 893,301 723,815 581,906 552,124 548,857 427,633
----------- ----------- ----------- ----------- ----------- -----------
Total assets ........................... $14,874,766 $13,664,992 $11,967,072 $10,712,377 $11,983,534 $ 8,910,161
=========== =========== =========== =========== =========== ===========
LIABILITIES, MINORITY INTEREST AND
STOCKHOLDERS' EQUITY
Deposits ................................... $ 7,070,091 $ 6,798,237 $ 5,494,746 $ 5,334,997 $ 5,421,777 $ 4,941,438
Federal Home Loan Bank advances ............ 5,744,594 4,783,294 3,992,344 3,490,386 4,383,895 2,620,329
Securities sold under agreements to
repurchase and federal fund
purchased ................................ 576,007 811,742 1,308,600 832,286 1,172,533 553,000
Notes payable .............................. 368,715 219,720 220,199 115,000 115,000 115,000
Other liabilities .......................... 206,883 182,087 167,204 223,165 208,726 143,532
----------- ----------- ----------- ----------- ----------- -----------
Total liabilities ...................... 13,966,290 12,795,080 11,183,093 9,995,834 11,301,931 8,373,299
----------- ----------- ----------- ----------- ----------- -----------
Minority interest-Bank preferred
stock .................................... 185,500 185,500 185,500 185,500 185,500 85,500
Stockholders' equity ....................... 722,976 684,412 598,479 531,043 496,103 451,362
----------- ----------- ----------- ----------- ----------- -----------
Total liabilities, minority
interest and stockholders'
equity ............................... $14,874,766 $13,664,992 $11,967,072 $10,712,377 $11,983,534 $ 8,910,161
=========== =========== =========== =========== =========== ===========
</TABLE>
S-7
<PAGE>
<TABLE>
<CAPTION>
AT OR FOR THE
SIX MONTHS
ENDED MARCH 31, AT OR FOR THE YEAR ENDED SEPTEMBER 30,
-------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
SUMMARY OF OPERATIONS
Interest income...................... $ 478,775 $ 442,581 $ 898,746 $ 810,708 $ 812,312 $ 746,759 $ 494,706
Interest expense..................... 319,172 303,179 612,665 546,064 584,778 552,760 320,924
--------- --------- --------- --------- --------- --------- ---------
Net interest income................ 159,603 139,402 286,081 264,644 227,534 193,999 173,782
Provisions for credit losses......... 12,384 14,963 20,123 18,107 16,469 24,293 6,997
--------- --------- --------- --------- --------- --------- ---------
Net interest income after
provision for credit losses.... 147,219 124,439 265,958 246,537 211,065 169,706 166,785
Non-interest income
Net gains (losses)
Sales of single family servicing
rights and single family
loans.......................... 13,175 2,541 11,124 21,182 43,074 60,495 63,286
Securities and mortgage-backed
securities..................... 785 1,801 2,761 2,841 4,002 26 10,404
Other loans...................... 1,027 376 651 1,128 3,189 (1,210) 163
Sale of mortgage offices......... -- -- -- 4,748 -- -- --
Loan servicing, net of related
amortization..................... 27,598 13,459 35,975 32,381 30,383 32,677 26,813
Other.............................. 18,711 13,280 30,426 21,152 15,541 12,162 13,295
--------- --------- --------- --------- --------- --------- ---------
Total non-interest income.......... 61,296 31,457 80,937 83,432 96,189 104,150 113,961
--------- --------- --------- --------- --------- --------- ---------
Non-interest expense
Compensation and benefits.......... 47,125 39,625 86,725 75,016 87,640 83,520 86,504
SAIF deposit insurance premiums.... 2,010 1,927 4,160 4,797 45,690 11,428 11,329
Court of Claims litigation......... 4,077 900 1,800 -- -- -- --
Restructuring charges.............. -- -- -- -- 10,681 -- --
Other.............................. 56,326 45,795 95,857 92,323 95,407 88,797 96,832
--------- --------- --------- --------- --------- --------- ---------
Total non-interest expense......... 109,538 88,247 188,542 172,136 239,418 183,745 194,665
--------- --------- --------- --------- --------- --------- ---------
Income before income taxes,
minority interest, and
extraordinary loss............... 98,977 67,649 158,353 157,833 67,836 90,111 86,081
Income tax expense (benefit)......... 37,365 (8,209) 25,722 60,686 (75,765) 37,415 (31,899)
--------- --------- --------- --------- --------- --------- ---------
Income before minority interest and
extraordinary loss............... 61,612 75,858 132,631 97,147 143,601 52,696 117,980
Minority interest
Bank preferred stock dividends..... 9,126 9,126 18,253 18,253 18,253 10,600 8,653
Payments in lieu of dividends...... -- -- -- -- 6,413 377 357
--------- --------- --------- --------- --------- --------- ---------
Income before extraordinary loss... 52,486 66,732 114,378 78,894 118,935 41,719 108,970
Extraordinary loss -- early
extinguishment of debt............. -- -- -- 2,323 -- -- --
--------- --------- --------- --------- --------- --------- ---------
Net income......................... $ 52,486 $ 66,732 $ 114,378 $ 76,571 $ 118,935 $ 41,719 $ 108,970
========= ========= ========= ========= ========= ========= =========
Net income applicable to diluted
earnings per common share........ $ 52,486 $ 66,732 $ 114,378 $ 76,571 $ 113,327 $ 38,824 $ 102,519
========= ========= ========= ========= ========= ========= =========
Earnings per common share
Basic.............................. $ 1.66 $ 2.11 $ 3.62 $ 2.42 $ 4.06 $ 1.45 $ 3.78
Diluted............................ 1.63 2.06 3.54 2.40 3.87 1.35 3.55
CERTAIN RATIOS AND OTHER DATA
Book value per common share.......... $ 22.91 $ 20.67 $ 21.67 $ 18.94 $ 16.81 $ 17.19 $ 15.64
Dividends per common share........... 0.32 0.32 0.64 0.56 3.16 -- --
Average common shares outstanding.... 31,565 31,596 31,595 31,596 29,260 28,863 28,863
Average common shares and potential
dilutive common
shares............................. 32,172 32,316 32,337 31,881 29,287 28,863 28,863
</TABLE>
S-8
<PAGE>
<TABLE>
<CAPTION>
AT OR FOR THE
SIX MONTHS
ENDED MARCH 31, AT OR FOR THE YEAR ENDED SEPTEMBER 30,
------------------------- ------------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
----------- ------------ ------------ ------------ ------------ ------------ ----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
CERTAIN RATIOS AND OTHER
DATA -- CONTINUED
Regulatory capital ratios of Bank
United Tangible capital ......... 6.73% 7.02% 6.75% 7.72% 6.57% 6.20% 6.01%
Core capital ...................... 6.75% 7.06% 6.77% 7.77% 6.64% 6.29% 6.17%
Total risk-based capital .......... 11.92% 11.59% 10.48% 13.18% 13.09% 13.45% 14.02%
Return on average assets ............ 0.86% 1.23% 1.04% 0.85% 1.28% 0.50% 1.42%
Return on average common equity ..... 14.91% 21.68% 17.78% 13.50% 23.06% 8.80% 26.32%
Stockholders' equity to assets ...... 4.86% 4.98% 5.01% 5.00% 4.96% 4.14% 5.07%
Tangible stockholders' equity to
tangible assets ................... 4.30% 4.52% 4.59% 4.89% 4.81% 3.93% 4.68%
Net yield on interest-earning
assets .......................... 2.41% 2.42% 2.42% 2.52% 2.10% 1.92% 2.20%
Interest rate spread ................ 2.23% 2.20% 2.21% 2.26% 1.78% 1.61% 1.95%
Average interest-earning assets to
average interest-bearing
liabilities ....................... 1.03 1.04 1.04 1.05 1.06 1.06 1.06
Single family servicing portfolio ... $27,303,981 $ 23,887,887 $ 27,935,300 $ 24,518,396 $ 13,246,848 $ 12,532,472 $8,920,760
Fundings:
Single family ..................... 2,399,057 1,959,019 3,789,389 2,188,273 3,602,009 3,226,324 5,424,550
Commercial ........................ 2,040,570 1,219,141 2,876,328 1,492,931 891,306 547,117 364,604
Consumer .......................... 142,620 180,030 367,097 152,665 125,596 99,249 94,153
----------- ------------ ------------ ------------ ------------ ------------ ----------
Total fundings ...................... 4,582,247 3,358,190 7,032,814 3,833,869 4,618,911 3,872,690 5,883,307
----------- ------------ ------------ ------------ ------------ ------------ ----------
Loans purchased for held to maturity
portfolio ......................... 1,021,884 183,509 1,158,270 1,086,249 148,510 2,658,093 1,406,275
Non-interest expense to average total
assets ............................ 1.53% 1.43% 1.48% 1.55% 2.13% 1.76% 2.35%
Net operating expense ratio ......... 0.67 0.92 0.84 0.80 1.28 0.76 0.97
Efficiency ratio .................... 48.36 50.39 49.88 49.20 72.23 58.26 63.36
Nonperforming assets to total
assets ............................ 0.62 0.63 0.59 0.63 1.12 0.84 1.09
Net nonaccrual loans to total
loans ............................. 0.54 0.62 0.57 0.60 1.19 0.91 1.51
Allowance for credit losses to net
nonaccrual loans .................. 93.34 71.44 75.91 72.61 44.24 48.74 30.73
Allowance for credit losses to
nonperforming assets .............. 64.06 54.76 57.84 52.24 32.95 36.65 24.18
Allowance for credit losses to total
loans ............................. 0.50 0.44 0.44 0.43 0.52 0.44 0.46
Net loan charge-offs to average
loans ............................. 0.06 0.20 0.13 0.23 0.17 0.16 0.30
Full-time equivalent employees ...... 2,234 1,689 1,927 1,541 2,310 2,663 2,894
Number of community banking
branches .......................... 94 80 84 71 70 65 62
Number of commercial banking
origination offices ............... 19 15 19 11 9 9 5
Number of mortgage origination
offices ........................... 9 6 8 6 85 122 145
</TABLE>
<TABLE>
<CAPTION>
AT OR FOR THE
SIX MONTHS
ENDED MARCH 31, AT OR FOR THE YEAR ENDED SEPTEMBER 30,
---------------------- ---------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---------- ---------- ---------- ---------- ---------- ---------- ---------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
CERTAIN RATIOS AND OTHER
DATA-EXCLUDING ADJUSTING ITEM
Net income........................... $ 55,036 $ 42,298 $ 89,944 $ 75,970 $ 56,392 $ 41,719 $ 50,804
Net income applicable to diluted
earnings per common shares......... 55,036 42,298 89,944 75,970 53,295 38,824 47,585
Earnings per diluted share........... 1.71 1.31 2.78 2.38 1.82 1.35 1.65
Return on average assets............. 0.89% 0.83% 0.85% 0.85% 0.67% 0.50% 0.72%
Return on average common equity...... 15.61 13.82 14.28 13.41 11.47 8.80 12.27
Efficiency ratio..................... 46.52 48.48 48.98 49.20 55.80 58.26 63.36
</TABLE>
S-9
<PAGE>
USE OF PROCEEDS
The net proceeds to be received by us from the sale of the preferred stock,
after deducting the underwriting discounts and estimated fees and expenses, will
be approximately $59.0 million. See "Underwriting" starting on page S-15. We
intend to use the net proceeds for general corporate purposes.
CAPITALIZATION
The following table shows the capitalization of Bank United as of March 31,
1999 and as adjusted to reflect (1) the issuance of the shares of preferred
stock offered hereby and (2) the concurrent offering of the Corporate PIES. In
addition to the long-term debt of Bank United reflected below at March 31, 1999,
our bank subsidiary had long-term borrowings consisting of deposits, FHLB
advances, and certain other funding liabilities incurred in the ordinary course
of business.
<TABLE>
<CAPTION>
AT MARCH 31, 1999
-----------------------------
HISTORICAL AS ADJUSTED
----------- ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Long-term debt(1).................... $ 368,715 $ 368,715
Redeemable preferred stock........... -- 160,000
Minority Interest -- Preferred Stock
of the bank subsidiary(2).......... 185,500 185,500
Stockholders' equity:
Preferred stock(3).............. -- --
Common stock.................... 316 316
Paid-in capital................. 129,343 126,643
Retained earnings............... 599,088 599,088
Accumulated other comprehensive
income -- unrealized gains
(losses) on securities
available for sale, net of
tax........................... (4,708) (4,708)
Treasury stock, at cost......... (1,063) (1,063)
----------- ------------
Total stockholders' equity...... 722,976 720,276
----------- ------------
Total consolidated
capitalization..... $ 1,277,191 $ 1,434,491
=========== ============
Ratio of equity to assets............ 4.86% 4.84%
Ratio of tangible equity to tangible
assets............................. 4.30% 4.28%
Total shares of common stock
outstanding........................ 31,562,896 31,562,896
Book value per common share.......... $ 22.91 $ 22.82
Tangible book value per share........ 20.15 20.06
</TABLE>
- ------------
(1) Excludes FHLB advances with maturities greater than one year of $2,330,345
at March 31, 1999 and as adjusted.
(2) Minority interest consists of $185.5 million stated value of the preferred
stock of the bank subsidiary.
(3) Bank United had 10,000,000 shares of preferred stock authorized, none of
which were issued as of March 31, 1999.
S-10
<PAGE>
DESCRIPTION OF THE PREFERRED STOCK
THE FOLLOWING SECTION DESCRIBES CERTAIN TERMS OF THE PREFERRED STOCK. IT
SUPPLEMENTS THE DESCRIPTION OF THE PREFERRED STOCK IN THE ACCOMPANYING
PROSPECTUS AND, TO THE EXTENT INCONSISTENT WITH THE PROSPECTUS, REPLACES THE
DESCRIPTION IN THE PROSPECTUS. THE FOLLOWING DESCRIPTION CONTAINS A DESCRIPTION
OF ALL MATERIAL TERMS OF THE PREFERRED STOCK, BUT DOES NOT PURPORT TO BE
COMPLETE AND IS SUBJECT TO AND QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
CERTIFICATE OF DESIGNATIONS RELATING TO THE PREFERRED STOCK. A FORM OF THE
CERTIFICATE OF DESIGNATIONS HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION AS AN EXHIBIT TO THE REGISTRATION STATEMENT OF WHICH THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS ARE A PART.
GENERAL
The preferred stock will rank senior to our common stock with respect to
the payment of dividends and upon liquidation, dissolution or winding up of Bank
United.
The preferred stock will not be convertible into shares of common stock or
any other class or series of our capital stock and will not be subject to any
sinking fund or other obligation for its repurchase or retirement.
The registrar, transfer agent and disbursing agent for the preferred stock
is The Bank of New York.
DIVIDENDS
Holders of shares of the preferred stock will be entitled to receive, when
and as declared by our board of directors out of assets of Bank United legally
available for payment, cash dividends at the annual rate of 7.55% through the
dividend payment date on February 15, 2000 and thereafter at the annual rate of
8.55%. Dividends on the preferred stock will be payable quarterly on February
15, May 15, August 15 and November 15 of each year, commencing November 15,
1999, at such annual rates.
Each such dividend will be payable to the holders of record as they appear
on the stock register on such record dates, not exceeding 45 days preceding the
relevant payment date, as shall be fixed by our board of directors. Dividends
will be cumulative from the date of issue. Dividends payable on the preferred
stock for any period greater or less than a full dividend period shall be
computed on the basis of twelve 30-day months, a 360-day year and the actual
number of days elapsed in the period. Dividends payable on the preferred stock
for each full dividend period shall be computed by annualizing the dividend rate
and dividing by four. The initial dividend on the preferred stock, which will be
for the period from August 10, 1999 to November 15, 1999, will be approximately
$1.017 per share of preferred stock and will be payable on November 15, 1999.
Through a subsidiary, we own all the outstanding common stock of our bank
subsidiary. As a holding company without significant assets other than our
indirect ownership of all the common stock of our bank subsidiary, our ability
to meet our cash obligations, including debt service, is dependent upon the
payment of dividends by our bank subsidiary on its common stock. The declaration
of dividends by the bank subsidiary is subject to the discretion of the board of
directors of the bank subsidiary, the terms of the outstanding preferred stock
of the bank subsidiary and applicable regulatory requirements. While it is the
present intention of the board of directors of the bank subsidiary to declare
dividends in an amount sufficient to provide us with the cash flow necessary to
meet our obligations, including dividends and mandatory redemption payments on
the preferred stock, we cannot assure you that circumstances which would limit
or preclude the declaration of dividends by the bank subsidiary on its common
stock will not exist in the future.
ADDITIONAL AMOUNTS
In the unlikely event that any distributions on the preferred stock with
respect to any fiscal year are not eligible for the dividends-received deduction
under the Internal Revenue Code of 1986, as amended, solely because the
preferred stock is treated as indebtedness pursuant to a final
S-11
<PAGE>
determination within the meaning of Section 1313(a) of the Internal Revenue Code
to which we or any U.S. corporate holder are parties ("Applicable
Distributions"), we will, within 45 days after our receipt of the
determination, provide notice thereof to the transfer agent. The transfer agent
will mail a copy of such notice to each U.S. corporate investor who received an
Applicable Distribution during such fiscal year at the address specified in the
records of the transfer agent as promptly as practicable after its receipt of
such notice from us. We will, within 15 days after such notice is given to the
transfer agent, pay to the transfer agent, out of funds legally available for
such payment, an amount equal to the aggregate Additional Amounts (as defined
below) with respect to all Applicable Distributions during such fiscal year.
Upon receipt of the aggregate Additional Amounts, the transfer agent will
distribute to each investor that certifies to the transfer agent, on a form
provided for that purpose, that it is (or was) otherwise qualified to receive
the dividends-received deduction under all relevant sections of the Internal
Revenue Code, the Additional Amount to which that investor is entitled with
respect to each Applicable Distribution received by the investor during the
fiscal year. Any portion of the aggregate Additional Amounts not distributed by
the transfer agent will be returned to us within 90 days of the transfer agent's
receipt of those amounts.
"Additional Amount(s)" means payment with respect to an Applicable
Distribution of an amount which, when taken together with such Applicable
Distribution, would cause the net yield in dollars, after federal income tax
consequences, from the aggregate of both the Applicable Distributions and the
Additional Amount, to be equal to the net yield in dollars after federal income
tax consequences that would have been realized by the investor if the amount of
the aggregate Applicable Distributions had been treated as a dividend, giving
effect to the dividends-received deduction, for federal income tax purposes. The
Additional Amount will be calculated with consideration given to the time value
of money, applying the corporate underpayment rate as defined in Section
6621(a)(2) of the Internal Revenue Code as the interest factor, assuming the
Additional Amount is subject to tax as ordinary income, and using the maximum
marginal corporate federal tax rate applicable to ordinary income.
REDEMPTION
Shares of the preferred stock will not be redeemable prior to February 15,
2000. On or after such date, the shares of preferred stock will be redeemable at
our option, in whole or in part, at any time or from time to time on not less
than 30 or more than 60 days notice by mail, at a redemption price equal to 100%
of the liquidation preference, plus accrued and upaid dividends to the date of
redemption.
We will be required to redeem the preferred stock, in whole and not in
part, on August 15, 2004, at a redemption price equal to 100% of its liquidation
preference plus accrued and unpaid dividends to the date of redemption.
RIGHTS UPON LIQUIDATION
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of Bank United, the holders of the preferred stock at the time
outstanding will be entitled to receive out of the assets of Bank United
available for distribution to stockholders, before any distribution of assets is
made to the holders of common stock or any other class of stock ranking junior
to the preferred stock upon liquidation, dissolution or winding up, liquidating
distributions in the amount of $50 per share, plus an amount equal to accrued
and unpaid dividends for the then-current dividend period and all dividend
periods prior thereto.
VOTING RIGHTS
Each share of preferred stock will have the right to vote in connection
with matters submitted generally to the holders of the common stock of Bank
United, voting together as a single class with shares of the common stock and
other capital stock of Bank United entitled to vote in respect of matters
submitted to stockholders generally. Each share of preferred stock will have
0.10 vote for this purpose. Based on the number of shares of common stock of
Bank United outstanding as of the date
S-12
<PAGE>
of this prospectus supplement and assuming that all shares offered hereby are
issued and outstanding, the shares of preferred stock would represent, in the
aggregate, approximately 0.38% of the combined voting power of the shares of
preferred stock and the common stock.
Whenever dividends on shares of the preferred stock have not been paid in
an aggregate amount equal to at least six quarterly dividends on those shares,
whether or not consecutive, the holders of the preferred stock, voting
separately as a class with the holders of any stock ranking equally as to
dividends with the preferred stock on which similar voting rights have been
conferred and are exercisable, will be entitled to elect two directors to our
board of directors either by written consent or at an annual or special meeting
of our stockholders held during the period those dividends remain in arrears.
These voting rights will terminate when all those dividends accrued and in
default have been paid in full or declared and funds for their payment in full
have been set apart. At that time, the term of office of all directors so
elected will also terminate.
In addition, the affirmative vote or consent of the holders of at least
two-thirds of the outstanding shares of preferred stock, voting as a separate
class, will be required for any amendment, alteration or repeal, whether by
merger, consolidation or otherwise, of any provisions of our certificate of
incorporation that adversely affect the powers, preferences, privileges or
rights of the holders of the preferred stock. The affirmative vote or consent of
the holders of shares representing at least two-thirds of the combined voting
power of the preferred stock and any other series of preferred stock of Bank
United ranking on a parity with the preferred stock as to dividends or upon
liquidation, voting as a single class without regard to series, will be required
to authorize or effect (1) the creation, authorization or issuance of, (2) the
reclassification of any authorized stock of Bank United into or (3) the
creation, authorization or issuance of any obligation or security convertible
into or evidencing the right to purchase, any additional class or series of
stock ranking prior to the preferred stock as to dividends or upon liquidation,
dissolution or winding up of Bank United.
Except as described above in this section on voting rights, as described in
the accompanying prospectus or as required by law, the preferred stock will have
no other voting rights.
BOOK-ENTRY ISSUANCE
The preferred stock will be issued as one or more global certificates
registered in the name of The Depository Trust Company ("DTC") or its nominee.
The depositary for the preferred stock will be DTC. The preferred stock will be
issued in accordance with the procedures described under "Book-Entry Procedures
and Settlement" below.
BOOK-ENTRY PROCEDURES AND SETTLEMENT
Upon issuance, all book-entry securities will be represented by one or more
fully registered global securities, without coupons. Each global security will
be deposited with, or on behalf of, DTC, a securities depository, and will be
registered in the name of DTC or a nominee of DTC. DTC will thus be the only
registered holder of these securities.
Purchasers of securities may only hold interests in the global notes
through DTC if they are participants in the DTC system. Purchasers may also hold
interests through a securities intermediary -- banks, brokerage houses and other
institutions that maintain securities accounts for customers -- that has an
account with DTC or its nominee. DTC will maintain accounts showing the security
holdings of its participants, and these participants will in turn maintain
accounts showing the security holdings of their customers. Some of these
customers may themselves be securities intermediaries holding securities for
their customers. Thus, each beneficial owner of a book-entry security will hold
that security indirectly through a hierarchy of intermediaries, with DTC at the
"top" and the beneficial owner's own securities intermediary at the
"bottom."
The securities of each beneficial owner of a book-entry security will be
evidenced solely by entries on the books of the beneficial owner's securities
intermediary. The actual purchaser of the securities will generally not be
entitled to have the securities represented by the global securities
S-13
<PAGE>
registered in its name and will not be considered the owner under Bank United's
charter or bylaws. In most cases, a beneficial owner will also not be able to
obtain a paper certificate evidencing the holder's ownership of securities. The
book-entry system for holding securities eliminates the need for physical
movement of certificates and is the system through which most publicly traded
stock is held in the United States. However, the laws of some jurisdictions
require some purchasers of securities to take physical delivery of their
securities in definitive form. These laws may impair the ability of a beneficial
owner to transfer book-entry securities.
A beneficial owner of book-entry securities represented by a global
security may exchange the securities for definitive (paper) securities only if:
o DTC is unwilling or unable to continue as depositary for such global
security and Bank United does not appoint a qualified replacement for DTC
within 90 days; or
o Bank United in its sole discretion decides to allow some or all
book-entry securities to be exchangeable for definitive securities in
registered form.
Any global security that is so exchanged will be exchanged in whole for
definitive securities in registered form, with the same terms and of an equal
aggregate liquidation preference. Definitive securities will be registered in
the name or names of the person or persons specified by DTC in a written
instruction to the registrar of the securities. DTC may base its written
instruction upon directions that it receives from its participants.
In this prospectus supplement and the related prospectus, references to
actions taken by security holders will mean actions taken by DTC upon
instructions from its participants, and references to payments and notices of
redemption to security holders will mean payments and notices of redemption to
DTC as the registered holder of the securities for distribution to participants
in accordance with DTC's procedures.
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 New York Uniform Commercial Code and a
"clearing agency" registered under section 17A of the Securities Exchange Act
of 1934. The rules applicable to DTC and its participants are on file with the
SEC.
DTC's management is aware that some computer applications, systems, and the
like for processing dates that are dependent upon calendar dates, including
dates before, on, and after January 1, 2000, may encounter "Year 2000
problems." DTC has informed its participants and other members of the financial
community that it has developed and is implementing a program so that its
systems, as they relate to the timely payment of distributions to
securityholders, book-entry deliveries, and settlement of trades within DTC,
continue to function appropriately. This program includes a technical assessment
and a remediation plan, each of which is complete. Additionally, DTC's plan
includes a testing phase, which is expected to be completed within appropriate
time frames.
Bank United will not have any responsibility or liability for any aspect of
the records relating to, or payments made on account of, beneficial ownership
interests in the book-entry securities or for maintaining, supervising or
reviewing any records relating to beneficial ownership interests.
DTC may discontinue providing its services as securities depositary at any
time by giving reasonable notice. Under such circumstances, in the event that a
successor securities depositary is not appointed, securities certificates are
required to be printed and delivered. Additionally, Bank United may decide to
discontinue use of the system of book-entry transfers through DTC or any
successor depositary with respect to the preferred securities. In that event,
certificates for the securities will be printed and delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that Bank United believes to be reliable, but
Bank United does not take responsibility for the accuracy thereof.
S-14
<PAGE>
UNDERWRITING
We have entered into an underwriting agreement with Lehman Brothers,
pursuant to which, and subject to its terms and conditions, we have agreed to
sell to Lehman Brothers and Lehman Brothers has agreed to purchase from us all
the offered shares of preferred stock.
The underwriting agreement provides that the obligation of Lehman Brothers
to purchase the preferred stock is subject to the satisfaction of certain
conditions, including the approval of certain legal matters by its counsel.
Subject to the terms and conditions of the underwriting agreement, Lehman
Brothers must purchase all of the shares of preferred stock offered hereby if it
purchases any of them.
Lehman Brothers has advised us that it will offer the preferred stock
directly to the public initially at the offering price and to certain dealers at
the offering price shown on the cover page of this prospectus supplement less a
selling concession not to exceed $0.375 per share of preferred stock. Lehman
Brothers may allow and these dealers may reallow a concession not to exceed
$0.1625 per share of preferred stock to other dealers. After the initial
offering of the preferred stock, Lehman Brothers may change the public offering
price, the concession to selected dealers and the reallowance to other dealers.
The following table shows the underwriting discount that we will pay to
Lehman Brothers in connection with this offering.
<TABLE>
<S> <C>
Per Share of Preferred Stock............ $ 0.70
Total................................... $ 840,000
</TABLE>
We estimate that our expenses in connection with the offering of the
preferred stock will be approximately $108,000.
We have agreed to indemnify Lehman Brothers against certain liabilities,
including liabilities under the Securities Act, and to contribute to payments
which Lehman Brothers would be required to make regarding any liabilities that
it may have under the Securities Act.
There is no established trading market for the preferred stock. The
preferred stock will not be listed on any securities exchange or quoted on any
quotation system. Lehman Brothers has advised us that it presently intends to
make a market in the preferred stock as permitted by applicable laws and
regulations. Lehman Brothers is not obligated to make a market in the preferred
stock, however, and it may discontinue this market making at any time in its
sole discretion. Accordingly, we cannot assure investors that there will be
adequate liquidity or adequate trading markets for the preferred stock.
In connection with the offering of the preferred stock, Lehman Brothers may
engage in certain transactions that stabilize the price of the preferred stock.
These transactions may consist of bids or purchases for the purpose of pegging,
fixing or maintaining the price of the preferred stock. If Lehman Brothers
creates a short position in the preferred stock in connection with this
offering, by selling more shares of preferred stock than are listed on the cover
page of this prospectus supplement, then Lehman Brothers may reduce that short
position by purchasing preferred stock in the open market. In general, the
purchase of a security for the purpose of stabilization or reducing a short
position could cause the price of that security to be higher than it might
otherwise be in the absence of those purchases.
Neither we nor Lehman Brothers makes any representation or prediction as to
the direction or magnitude of any effect that the transactions described above
may have on the price of the preferred stock. In addition, neither we nor Lehman
Brothers makes any representation that anyone will engage in these transactions
or that these transactions, once they have begun, will not be discontinued
without notice.
Lehman Brothers has, directly and indirectly, provided investment and
commercial banking or financial advisory services to us and our affiliates, for
which it has received customary fees and
S-15
<PAGE>
commissions, and expects to provide these services to us and our affiliates in
the future, for which it expects to receive customary fees and commissions.
Certain wholly owned subsidiaries of Lehman Brothers Inc. own an aggregate
of 1,529,557 shares of common stock of Bank United, which represents 5.4% of the
outstanding common stock.
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following summary of certain of the United States federal income tax
consequences of the ownership of the preferred stock is for discussion purposes
only. It is based upon laws, regulations, rulings and decisions in effect, all
of which are subject to changes in application or interpretation that could
apply retroactively, resulting in U.S. federal income tax consequences different
from those discussed below. This summary deals only with preferred stock held as
capital assets and does not purport to deal with persons in special tax
situations, such as financial institutions, insurance companies, tax-exempt
entities, regulated investment companies, dealers in securities or currencies,
non-resident alien individuals, foreign corporations, foreign partnerships or
foreign estates or trusts, persons holding preferred stock as a hedge against
currency risk or as a position in a "straddle" for tax purposes, persons whose
functional currency is not the United States dollar, or persons subject to the
alternative minimum tax. This summary also does not address holders other than
original purchasers or the consequences of any laws other than those pertaining
to the U.S. federal income tax. Persons considering purchasing the preferred
stock should consult their own tax advisors concerning the application of United
States federal income tax laws to their particular situations as well as any
consequences of the purchase, ownership, and disposition of the preferred stock
under the laws of any other taxing jurisdiction.
We expect all distributions declared and paid by us on shares of preferred
stock:
o to be treated as dividends for federal income tax purposes to the extent
paid out of our current or accumulated earnings and profits, as
determined for federal income tax purposes, and
o to be eligible for the 70% dividends received deduction allowed to
qualifying U.S. corporate shareholders.
We expect to have sufficient earnings and profits to enable all
distributions on the preferred stock to qualify as dividends for federal income
tax purposes. We cannot assure prospective holders that we will have sufficient
current earnings and profits for all distributions on the preferred stock,
however, as our expectation is based in part on assumptions as to various
factors that are beyond our control. Although we expect that the preferred stock
will be treated as preferred stock for U.S. federal income tax purposes, it is
possible that it could be treated as indebtedness. In the unlikely event that it
were so treated, with the effect that recipients of distributions from us were
not eligible to receive the dividends-received deduction, an Additional Amount
would be payable by us in accordance with "Description of the Preferred
Stock -- Additional Amounts" above, and the tax consequences of income received
on the preferred stock could differ from those described in this section.
Prospective investors in shares of the preferred stock should consider the
effect of section 246A of the Internal Revenue Code, which reduces the
dividends-received deduction allowed to a corporate shareholder that has
incurred indebtedness that is "directly attributable" to an investment in
portfolio stock. Prospective investors should also consider the effect of
section 246(c) of the Internal Revenue Code, which among other things, disallows
the dividends-received deduction in respect of any dividend on a share of stock
that has been held for 45 days or less during the 90-day period beginning on the
date that is 45 days before the date on which such share becomes ex-dividend
with respect to such dividend. Any period will not be counted toward the 45-day
holding period if during that period the holder has an option to sell, is under
a contractual obligation to sell, has made (and not closed) a short sale of, or
has granted certain options to buy, substantially identical stock or securities,
or holds one or more other positions in substantially similar or related
property that diminish the risk of loss
S-16
<PAGE>
from holding preferred stock. Prospective investors should also consider the
effect of section 1059 of the Internal Revenue Code, which reduces a
shareholder's basis in stock upon the receipt of an extraordinary dividend and
in certain other circumstances that could apply if we failed to pay dividends
currently on the preferred stock or the preferred stock were considered to have
been issued with an issue price in excess of its liquidation rights or stated
redemption price, which we believe is not the case.
In the past, legislation has been proposed that would have reduced the
dividends received deduction applicable to certain preferred stock. There can be
no assurance that similar legislation will not be enacted in the future or that
other legislation will not be enacted that would reduce the dividends-received
deduction available to corporate holders of the preferred stock.
Because the availability of the dividends-received deduction may be
affected by the particular circumstances of each U.S. corporate holder of the
stock, prospective U.S. corporate investors are encouraged to consult their tax
advisors.
LEGAL MATTERS
The validity of the preferred stock which is being offered will be passed
upon for us by Wachtell, Lipton, Rosen & Katz, New York, New York. Certain legal
matters will be passed upon for Lehman Brothers by Simpson Thacher & Bartlett,
New York, New York.
EXPERTS
The financial statements and the related financial statement schedules
incorporated in this prospectus supplement by reference from Bank United Corp.'s
Annual Report on Form 10-K for the year ended September 30, 1998 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
report, which is incorporated by reference in this prospectus supplement, and
have been so incorporated in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended December 31, 1998 and March 31, 1999 which are incorporated in this
prospectus supplement by reference, Deloitte & Touche have applied limited
procedures in accordance with professional standards for a review of such
information. However, as stated in their report included in Bank United Corp.'s
Quarterly Report on Form 10-Q they did not audit and they do not express an
opinion on that interim financial information. Accordingly, the degree of
reliance on their reports on such information should be restricted in light of
the limited nature of the review procedures applied. Deloitte & Touche are not
subject to the liability provisions of Section 11 of the Securities Act of 1933
for their reports on the unaudited interim financial information because those
reports are not "reports" or a "part" of the registration statement prepared
or certified by an accountant within the meaning of Sections 7 and 11 of the
Securities Act.
S-17
<PAGE>
PROSPECTUS
[BANK UNITED CORP. LOGO]
----------------------------------------------
BANK UNITED CAPITAL TRUST
----------------------------------------------
$830,000,000
PREFERRED STOCK
CLASS A COMMON STOCK
DEPOSITARY SHARES
JUNIOR SUBORDINATED DEBT SECURITIES
GUARANTEE
STOCK PURCHASE CONTRACTS
STOCK PURCHASE UNITS
of Bank United Corp.
TRUST PREFERRED SECURITIES
of Bank United Capital Trust
INVESTING IN THE OFFERED SECURITIES INVOLVES CERTAIN RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 1.
Our Class A common stock is traded on the Nasdaq under the symbol "BNKU". On
August 4, 1999, the last reported sale price of our Class A common stock on the
Nasdaq was $37.4375 per share. We urge prospective purchasers of the Class A
common stock to obtain current information as to market prices of the Class A
common stock.
We may use this prospectus to sell Class A common stock, preferred stock,
depositary shares, junior subordinated debt securities, guarantees, stock
purchase contracts or stock purchase units. We may also use this prospectus for
Bank United Capital Trust to sell trust preferred securities or for selling
stockholders to sell Class A common stock.
WE WILL PROVIDE SPECIFIC TERMS OF THESE SECURITIES IN SUPPLEMENTS TO THIS
PROSPECTUS. YOU SHOULD READ THIS PROSPECTUS AND ANY SUPPLEMENTS CAREFULLY
BEFORE YOU INVEST.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THIS PROSPECTUS MAY NOT BE USED TO SELL SECURITIES UNLESS ACCOMPANIED BY A
PROSPECTUS SUPPLEMENT.
THESE SECURITIES ARE NOT OBLIGATIONS OF A BANK OR SAVINGS ASSOCIATION AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
------------------------
AUGUST 4, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Risk Factors............................ 1
Use of Proceeds......................... 4
Ratios of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges
and Preferred Dividends............... 4
Bank United Corp........................ 5
Bank United Capital Trust............... 6
Description of Offered Securities....... 8
Relationship Among the Trust Preferred
Securities, the Trust Preferred
Securities
Guarantee and the Junior Subordinated
Notes Held by Bank United Capital
Trust................................. 33
Selling Stockholders.................... 34
Plan of Distribution.................... 35
Legal Matters........................... 36
Experts................................. 36
Forward-Looking Information............. 36
About this Prospectus................... 37
Where You Can Find More Information..... 38
</TABLE>
<PAGE>
RISK FACTORS
An investment in any of the securities offered by this prospectus involves
certain risks. Before you decide to purchase any of these securities, you should
carefully consider the following risk factors, in addition to the other
information included in this prospectus and the applicable prospectus
supplement, before making an investment decision.
HOLDERS OF SHARES OF OUR COMMON STOCK COULD EXPERIENCE DILUTION.
We issued 31,595,596 shares in our IPO in August 1996. Since that time, we
have repurchased 34,200 shares and issued 142,250 shares, so that we currently
have 31,703,646 shares of common stock outstanding. Of the 31,595,596 shares
issued in our IPO, 12,075,000 were registered under the Securities Act of 1933
and sold to the public in the IPO, and 19,520,596 were subject to contractual
restrictions on sale which expired or expire at various times. We agreed to use
our best efforts to register these 19,520,596 shares under the Securities Act
and to maintain the effectiveness of these registrations for a specified period.
The restrictions on 11,314,818 shares expired prior to March 31, 1999, and the
contractual restrictions on the sale of 7,887,436 of the remaining 8,205,778
shares were terminated on June 4, 1999 and the restrictions on the remaining
318,342 shares will terminate on July 28, 1999.
OUR OBLIGATIONS UNDER THE TRUST PREFERRED SECURITIES GUARANTEE AND THE JUNIOR
SUBORDINATED DEBT SECURITIES ARE SUBORDINATED.
Our obligations under the trust preferred securities guarantee and under
the junior subordinated debt securities will rank junior in priority of payment
to all our senior indebtedness. This means that we cannot make any payments on
the trust preferred securities guarantee or the junior subordinated debt
securities if we default on a payment of senior indebtedness and do not cure the
default within the applicable grace period, or if the senior indebtedness
becomes immediately due because of a default and has not yet been paid in full.
In addition, our obligations under the trust preferred securities guarantee and
under the junior subordinated debt securities will rank junior to all existing
and future liabilities of our subsidiaries.
We cannot make any payments on the trust preferred securities guarantee if
we default on a payment on any of our other debt. In addition, in the event of
our bankruptcy, liquidation or dissolution, our assets would be available to pay
obligations under the trust preferred securities guarantee only after we have
made all payments on our other liabilities.
Neither the trust preferred securities of Bank United Capital Trust, our
junior subordinated debt securities nor our trust preferred securities guarantee
limit our ability or that of our subsidiaries to incur additional indebtedness,
including indebtedness that ranks senior in priority of payment to the junior
subordinated debt securities and the trust preferred securities guarantee.
BANK UNITED CAPITAL TRUST'S ABILITY TO MAKE PAYMENTS ON ITS TRUST PREFERRED
SECURITIES WILL DEPEND ENTIRELY ON OUR PAYMENTS ON OUR JUNIOR SUBORDINATED DEBT
SECURITIES.
The only assets of Bank United Capital Trust will be its investment in our
junior subordinated debt securities. Accordingly, the ability of Bank United
Capital Trust to pay scheduled distributions on its trust preferred securities,
as well as the redemption price and the liquidation amount of the trust
preferred securities, is solely dependent upon us paying, when due, the related
payments we are obligated to pay on the junior subordinated debt securities.
OUR OBLIGATIONS UNDER THE TRUST PREFERRED SECURITIES GUARANTEE ARE LIMITED.
The trust preferred securities guarantee only guarantees that we will make
distribution, redemption and liquidation payments on the trust preferred
securities of Bank United Capital Trust if it has the funds to do so itself but
does not. If we fail to pay in full principal or interest when due on our junior
subordinated debt securities, Bank United Capital Trust will not have sufficient
funds to make distribution, redemption or liquidation payments on the trust
preferred securities. In those
1
<PAGE>
circumstances, you also will not be able to rely upon the trust preferred
securities guarantee for payment of these amounts.
Instead, you:
o may directly sue us or seek other remedies to collect your
proportionate share of payments owed; or
o rely on the Property Trustee to enforce Bank United Capital Trust's
rights under the junior subordinated debt securities.
OUR DEFERRAL OF DISTRIBUTIONS ON THE JUNIOR SUBORDINATED DEBT SECURITIES WOULD
NOT RELIEVE YOU OF LIABILITY FOR TAXES AND COULD AFFECT THE TRADING PRICE OF THE
TRUST PREFERRED SECURITIES.
So long as no event of default under the junior subordinated debt
securities has occurred and is continuing, we can, on one or more occasions,
defer interest payments on the junior subordinated debt securities for the
number of consecutive periods specified in the applicable prospectus supplement.
If we defer interest payments on the junior subordinated debt securities, Bank
United Capital Trust will defer distributions on the trust preferred securities
during such deferral period. However, distributions will still accumulate and
such deferred distributions will themselves accrue interest to the extent
permitted by law.
If we defer payments of interest on the junior subordinated debt securities
held by Bank United Capital Trust, you will be required to recognize interest
income for U.S. federal income tax purposes based on your proportionate share of
the interest on those junior subordinated debt securities before you receive any
cash relating to such interest. In addition, you will not receive such cash from
the trust if you sell the trust preferred securities before the end of any
deferral period or before the record date relating to distributions that are
paid.
We have no current intention of deferring interest payments on the junior
subordinated debt securities and believe that deferral is a remote possibility.
However, if we exercise our right to defer in the future, the trust preferred
securities may trade at a price that does not fully reflect the value of accrued
but unpaid interest on the junior subordinated debt securities. If you sell the
trust preferred securities during an interest deferral period, you may not
receive the same return on your investment as someone who continues to hold the
trust preferred securities.
Even if we do not exercise our right to defer interest payments on the
junior subordinated debt securities, our right to do so may make the market
price for the trust preferred securities more volatile than that of other
securities without this feature.
The prospectus supplement with respect to the trust preferred securities
will describe relevant U.S. federal income tax considerations applicable to the
purchase, holding and disposition of the trust preferred securities.
WE MAY REDEEM YOUR TRUST PREFERRED SECURITIES AT ANY TIME IF SPECIFIED CHANGES
IN TAX, INVESTMENT COMPANY OR BANK REGULATORY LAW OCCUR.
If any of the changes in tax, investment company or bank regulatory law
described in this prospectus occur and are continuing, and certain other
conditions are satisfied, we will have the right to redeem the junior
subordinated debt securities within 90 days of the event whether or not we could
otherwise have redeemed the junior subordinated debt securities at that time.
Any redemption will cause a mandatory redemption of trust preferred securities
having a total liquidation amount equal to the total principal amount of junior
subordinated debt securities to be redeemed. Prior to any such redemption, we
will obtain any required regulatory approvals. See "Description of the Offered
Securities -- Trust Preferred Securities -- Distribution of the Junior
Subordinated Debt Securities" and "-- Special Event Redemption."
2
<PAGE>
HOLDERS OF THE TRUST PREFERRED SECURITIES WILL HAVE LIMITED VOTING RIGHTS.
You will have very limited voting rights if you own or hold trust preferred
securities. Among other things, we will have the power to elect or remove any of
the trustees of Bank United Capital Trust unless an event of default under the
junior subordinated debt securities has occurred and is continuing. See "Trust
Preferred Securities -- Voting Rights; Amendment of Declaration."
WE MAY TERMINATE BANK UNITED CAPITAL TRUST AT ANY TIME.
Subject to obtaining any required regulatory approval, we have the right to
terminate Bank United Capital Trust at any time. If we decide to exercise our
right to terminate Bank United Capital Trust, Bank United Capital Trust will
redeem its trust securities by distributing the junior subordinated debt
securities to holders of the trust securities on a proportionate basis.
Under current U.S. federal income tax law, a distribution of junior
subordinated debt securities to you upon the dissolution of Bank United Capital
Trust should not be a taxable event to you. However, if Bank United Capital
Trust is characterized for U.S. federal income tax purposes as an association
taxable as a corporation at the time it is dissolved or if there is a change in
law, the distribution of junior subordinated debt securities to you may be a
taxable event to you.
We have no current intention of terminating Bank United Capital Trust and
distributing junior subordinated debt securities to the holders of its trust
preferred securities. We anticipate that we would consider exercising this right
in the event that expenses associated with maintaining Bank United Capital Trust
were substantially greater than currently expected, such as if certain changes
in tax, investment company or bank regulatory law occurred. We cannot predict
the other circumstances under which we would exercise this right.
THE TRUST PREFERRED SECURITIES ARE A NEW SECURITY WITH NO PRIOR MARKET.
Prior to this offering there has been no public market for the trust
preferred securities, and we cannot assure you that a market will develop. The
trust preferred securities may not be listed on any securities exchange. The
underwriters may make a market in the trust preferred securities after the
consummation of this offering, as permitted by applicable laws and regulations;
however, the underwriters are not obligated to do so, and may discontinue any
such market making activities at any time without notice. If a trading market
for the trust preferred securities does develop, the trust preferred securities
may trade at a discount from their initial offering price depending on
prevailing interest rates, the market for similar securities, our performance
and other factors.
THERE MAY BE NO TRADING MARKET FOR THE JUNIOR SUBORDINATED DEBT SECURITIES.
Although we will use our best efforts to list the junior subordinated debt
securities on the exchange, if any, on which the trust preferred securities are
then listed if they are distributed, we cannot assure you that the junior
subordinated debt securities will be approved for listing on that exchange or
that a trading market will exist for those securities.
3
<PAGE>
USE OF PROCEEDS
Unless we have indicated otherwise in the applicable prospectus supplement,
we expect to use the net proceeds we receive from any offering of these
securities for our general corporate purposes. Bank United Capital Trust will
use the net proceeds from the sale of its trust preferred securities to purchase
junior subordinated debt securities from us.
Neither we nor Bank United Capital Trust will receive any of the proceeds
from any sale of Class A common stock by any of the selling stockholders. See
"Selling Stockholders."
RATIOS OF EARNINGS TO FIXED CHARGES
AND EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
Our ratios of earnings to fixed charges, which are computed on the basis of
the total enterprise (as defined by the Securities and Exchange Commission) by
dividing earnings before fixed charges and income taxes by fixed charges, are
shown below for the periods indicated. Also shown below are our ratios of
earnings to combined fixed charges and preferred stock dividends, which are
computed on the basis of the total enterprise by dividing earnings before fixed
charges and income taxes by fixed charges and preferred stock dividend
requirements, for the periods indicated. Fixed charges consist principally of
interest expense on all long- and short-term borrowings, excluding or including
interest on deposits as indicated.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
MARCH 31, YEAR ENDED SEPTEMBER 30,
-------------------- -----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
EARNINGS TO FIXED CHARGES:
Excluding interest expense on
deposits......................... 1.56 1.41 1.50 1.54 1.21 1.30 1.72
Including interest expense on
deposits......................... 1.31 1.22 1.26 1.29 1.11 1.16 1.26
EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED DIVIDENDS:
Excluding interest expense on
deposits......................... 1.44 1.30 1.37 1.40 1.10 1.23 1.54
Including interest expense on
deposits......................... 1.25 1.17 1.20 1.22 1.06 1.13 1.21
</TABLE>
4
<PAGE>
BANK UNITED CORP.
We are a broad-based financial services provider to consumers and
businesses in Texas and selected regional markets throughout the United States.
At March 31, 1999, we operated a 94-branch community banking network serving
nearly 265,000 households, as well as 19 commercial banking offices in 16 states
across the country. As of March 31, 1999, we were the largest publicly traded
financial institution headquartered in Texas, with $14.9 billion in assets, $6.6
billion in deposits, and $723.0 million in stockholders' equity. Our address is
3200 Southwest Freeway, Suite 2600, Houston, Texas 77027 and our telephone
number is (713) 543-6500.
We were incorporated in Delaware on December 19, 1989 as USAT Holdings Inc.
and became the holding company for Bank United (the "Bank") upon its formation
on December 30, 1988. The Bank is a federally chartered savings bank, the
deposits of which are insured by the Savings Association Insurance Fund, which
is administered by the FDIC. In December 1996, we formed a wholly owned,
Delaware subsidiary, BNKU Holdings, Inc., which is now the direct parent company
of the Bank.
The Bank's capital levels at March 31, 1999 and September 30, 1998
qualified it as "well-capitalized," the highest of five categories under
applicable regulatory definitions. The Bank's capital ratios at March 31, 1999
and September 30, 1998, and the applicable regulatory capital requirements, were
as follows:
<TABLE>
<CAPTION>
MARCH 31, SEPTEMBER 30, CAPITAL ADEQUACY WELL-CAPITALIZED
1999 1998 REQUIREMENT REQUIREMENT
----------- --------------- ----------------- -----------------
<S> <C> <C> <C> <C>
Tangible capital..................... 6.73% 6.75% 1.50% --
Core/leverage capital................ 6.75% 6.77% 3.00% 5.00%
Tier 1 capital....................... 9.86% 9.97% -- 6.00%
Total risk-based capital............. 11.92% 10.48% 8.00% 10.00%
</TABLE>
5
<PAGE>
BANK UNITED CAPITAL TRUST
Bank United Capital Trust is a statutory business trust newly formed under
Delaware law by (1) a declaration of trust executed by us, as sponsor for the
trust, and by the trustees for the trust, and (2) the filing of a certificate of
trust with the Delaware Secretary of State. The declaration will be amended and
restated in its entirety substantially in the form filed as an exhibit to the
registration statement of which this prospectus forms a part, as of the date
securities of Bank United Capital Trust are initially issued. The amended
declaration will be qualified as an indenture under the Trust Indenture Act of
1939.
Bank United Capital Trust exists for the exclusive purposes of (1) issuing
two classes of trust securities, trust preferred securities and trust common
securities, which together represent undivided beneficial interests in the
assets of Bank United Capital Trust; (2) investing the gross proceeds of the
trust securities in our junior subordinated debt securities; and (3) engaging in
only those other activities necessary or incidental thereto.
We will directly or indirectly own all of the trust common securities. The
trust common securities will rank equally in right of payment, and payments will
be made thereon proportionately, with the trust preferred securities except that
upon the occurrence and during the continuance of an event of default under the
amended declaration, the rights of the holders of the trust common securities to
payment in respect of distributions and payments upon liquidation, redemption
and otherwise will be subordinated to the rights of the holders of the trust
preferred securities. We will acquire, directly or indirectly, trust common
securities in a total liquidation amount equal to 3% of the total capital of
Bank United Capital Trust.
Bank United Capital Trust has a term of approximately 55 years, but may
terminate earlier as provided in its amended declaration. The business and
affairs of Bank United Capital Trust will be conducted by its trustees, who will
initially be appointed by us, as the direct or indirect holder of all the trust
common securities. We, as the direct or indirect holder of all of the trust
common securities of Bank United Capital Trust, will also be entitled to
appoint, remove or replace the Bank United Capital Trust trustees, unless an
event of default in respect of our junior subordinated debt securities held by
Bank United Capital Trust has occurred and is continuing.
The duties and obligations of the Bank United Capital Trust trustees will
be governed by the amended declaration. A majority of the Bank United Capital
Trust trustees (the "Regular Trustees") will be persons who are our employees,
officers, or affiliates.
One Bank United Capital Trust trustee will be a financial institution
unaffiliated with us that will act as property trustee and as indenture trustee
for purposes of the Trust Indenture Act, under the terms set forth in a
prospectus supplement (the "Property Trustee"). The Property Trustee will hold
title to the junior subordinated debt securities for the benefit of the holders
of the trust securities of Bank United Capital Trust. As holder of the junior
subordinated securities the Property Trustee will have the power to exercise all
rights, powers and privileges under the indenture related to the junior
subordinated debt securities. In addition, the Property Trustee will maintain
exclusive control of a segregated non-interest bearing bank account (the
"Property Account") to hold all payments made in respect of the junior
subordinated debt securities held by it for the benefit of the holders of the
trust preferred securities of Bank United Capital Trust. The Property Trustee
will make payments of distributions and payments on liquidation, redemption and
otherwise to the Property Account. Unless the Property Trustee maintains a
principal place of business in the State of Delaware, and otherwise meets the
requirements of applicable law, one Bank United Capital Trust trustee will have
its principal place of business or reside in the State of Delaware (the
"Delaware Trustee"). In limited circumstances that will be described in a
prospectus supplement relating to trust preferred securities, the holders of a
majority of the trust preferred securities will be entitled to appoint or remove
the Property Trustee or the Delaware Trustee.
6
<PAGE>
The rights of the holders of the trust securities, including economic
rights, rights to information and voting rights, are contained in the amended
declaration, the Delaware Business Trust Act and the Trust Indenture Act. We
will pay all fees and expenses related to Bank United Capital Trust and the
offering of trust securities, the payment of which will be guaranteed by us. The
office of the Delaware Trustee for Bank United Capital Trust in the State of
Delaware is The Bank of New York (Delaware), White Clay Center, Route 273,
Newark, Delaware 19711. The principal place of business of Bank United Capital
Trust will be c/o Bank United Corp., 3200 Southwest Freeway, Suite 2600,
Houston, Texas 77027 and its telephone number is (713) 543-6500.
7
<PAGE>
DESCRIPTION OF OFFERED SECURITIES
If so indicated in the applicable prospectus supplement, the terms of any
securities may differ from the terms set forth below.
CLASS A COMMON STOCK
As of July 22, 1999, we had 31,703,646 shares of Class A common stock
issued and outstanding and 3,762,270 shares reserved for issuance under our
stock option plans. The material provisions relating to our Class A common stock
can be found in our certificate of incorporation and by-laws, copies of which
have been filed with the Commission. See "Where You Can Find More
Information."
We have no other classes of common stock outstanding as of the date of this
prospectus.
PREFERRED STOCK
The following is a summary of the principal terms of our preferred stock.
This summary is not complete, may not contain all the information that is
important to you and is qualified in its entirety by the provisions of our
certificate of incorporation and by-laws, copies of which have been filed with
the Commission. See "Where You Can Find More Information."
Our board of directors is authorized by our certificate of incorporation to
provide, without further stockholder action, for the issuance of one or more
series of preferred stock. Our board of directors has the power to fix various
terms with respect to each series, including voting powers, designations,
preferences and relative, participating, optional or other special rights,
qualifications, limitations, restrictions and redemption, conversion or
exchangeability provisions.
The applicable prospectus supplement will contain the following principal
terms of the series of preferred stock offered thereby:
o the designation, number of shares and liquidation preference per
share;
o initial public offering price;
o the dividend rate or rates;
o the index, if any, upon which the amount of dividends, if any, is
determined;
o the dates on which dividends, if any, will accrue and be payable
and the designated record dates for determining the holders entitled
to such dividends;
o any redemption or sinking fund provisions;
o any conversion or exchange provisions;
o provisions for issuance of global securities;
o the securities exchange, if any, on which the preferred stock will
be listed;
o the currency, which may be composite currency, in which dividends,
if any, will be payable if other than U.S. dollars;
o voting rights; and
o any additional terms, preferences or rights.
Under regulations adopted by the Office of Thrift Supervision, if the
holders of shares of any series of our preferred stock become entitled to vote
for the election of directors because our board of directors has failed to
declare or pay dividends on that series, that series may then be deemed a class
of "voting securities." In that case, an institutional holder of 25% or more
of that series, or an institutional holder of five percent or more if it
otherwise exercises a "controlling influence" over us, may then be subject to
regulation as a savings and loan holding company in accordance with the Home
Owner's Loan Act. In addition, if and when a series is deemed a class of voting
securities, any other savings and loan holding company may be required to obtain
the prior approval of the OTS to acquire five percent or more of that series,
and any person other than a savings and loan holding company may be required to
obtain the prior approval of the OTS to acquire ten percent or more of that
series.
8
<PAGE>
The shares of preferred stock will, when issued, be fully paid and
nonassessable and will have no preemptive rights to subscribe for any additional
securities that we may issue. Unless otherwise specified in the applicable
prospectus supplement, the preferred stock will rank on a parity in all respects
with any outstanding preferred stock we may have and will have priority over our
common stock as to dividends and distributions of assets. Therefore, the rights
of any preferred stock that may subsequently be issued may limit the rights of
the holders of our common stock and preferred stock.
The transfer agent, registrar, dividend disbursing agent and redemption
agent for each series of preferred stock will be specified in the applicable
prospectus supplement.
Because we are a holding company, our rights and the rights of our
creditors and our stockholders, including the holders of any shares of preferred
stock, to participate in any distribution of assets of any subsidiary upon the
subsidiary's liquidation or recapitalization will be subject to the prior claims
of the subsidiary's creditors, except to the extent that we may be a creditor
with recognized claims against the subsidiary.
The principal source of our revenues is dividends received from the Bank.
Various statutory provisions limit the amount of dividends the Bank and our
nonbank subsidiaries can pay without regulatory approval, and various
regulations can also restrict the payment of dividends. Changes in regulations
could further limit the ability of the Bank to pay dividends to us, and federal
statutes limit the ability of subsidiary banks to make loans to us.
DIVIDENDS. The holders of each series of our preferred stock will be
entitled to receive, when, as and if declared by our board of directors, out of
funds legally available for that purpose, cumulative or non-cumulative cash or
other dividends. We will describe the rate or rates and payment dates applicable
to each series of preferred stock in the applicable prospectus supplement. Those
rates may be fixed or variable or both. If variable, we will describe the
formula used for determining the dividend rate for each dividend period in the
applicable prospectus supplement. We will pay dividends to the holders of record
as they appear on our stock books on the record dates set by our board of
directors and specified in the applicable prospectus supplement. If our board of
directors fails to declare a dividend payable on a dividend payment date on any
series of the preferred stock for which dividends are noncumulative, then the
holders of these noncumulative series of the preferred stock will have no right
to receive a dividend in respect of the dividend period ending on that dividend
payment date, and we will have no obligation to pay a dividend for that period,
whether or not dividends on that series are declared payable on any future
dividend payment dates.
Unless otherwise indicated in the applicable prospectus supplement:
o we may not declare dividends on any other series or class of preferred
stock ranking on a parity as to dividends unless full cumulative
dividends on all outstanding shares of each series of cumulative
preferred stock have been paid in full or contemporaneously are
declared and paid through the most recent dividend payment date; and
o in the event that full cumulative dividends on any series of
cumulative preferred stock have not been declared and paid or set
apart when due, we may not declare or pay any dividends or other
distributions on any other shares of our stock ranking junior to the
preferred stock, unless full cumulative dividends on that series are
made or set apart for payment; but
o we may, however, pay dividends or distributions in shares of common
stock, or using options, warrants or rights to subscribe for or
purchase shares of common stock or other junior ranking stock.
REDEMPTION. The shares of any series of our preferred stock may be
redeemable at our option and may be subject to mandatory redemption under a
sinking fund or otherwise, in each case upon the terms, on the date or dates and
at the redemption price or prices set forth in the applicable prospectus
supplement. If fewer than all shares of preferred stock are to be redeemed, the
shares to be redeemed will be selected by us proportionately, by lot or by any
other method determined by our board of directors to be equitable.
9
<PAGE>
If we have not paid any dividends on shares of any series of preferred
stock when due:
o we may not redeem shares of common stock or shares of capital stock
ranking junior to or on parity with the preferred stock;
o we may not redeem shares of that series of preferred stock unless we
simultaneously redeem all outstanding shares of that series; and
o we may not purchase or otherwise acquire any shares of that series;
but
o we may, however, purchase or acquire shares of that series under a
purchase or exchange offer made on the same terms to holders of all
shares of that series.
Any notice of redemption will be given by mailing the notice to each record
holder of the shares to be redeemed, not less than 40 days nor more than 70 days
prior to the redemption date, to the addresses of the holders as they appear on
our stock books. Each notice will state:
o the redemption date;
o the number of shares and series of preferred stock that we will
redeem;
o the redemption price and the manner in which we will pay and deliver
the redemption price;
o the place or places where holders must surrender certificates for the
shares of preferred stock to be redeemed in exchange for payment of
the redemption price;
o that dividends on the shares of preferred stock to be redeemed will
cease to accrue on the redemption date; and
o if we are redeeming fewer than all shares of any series of preferred
stock held by any holder, the number of shares that we will redeem.
If we have given notice of redemption, unless we have defaulted in
providing the requisite funds to redeem the shares we call for redemption, from
and after the redemption date for the shares of the series of the preferred
stock we call for redemption:
o dividends on the shares of preferred stock called for redemption will
cease to accrue;
o any right to convert the shares of preferred stock of that series will
terminate;
o shares of preferred stock of that series will no longer be deemed to
be outstanding; and
o rights of the holders of the shares of preferred stock of that series
as our stockholders, except the right to receive the redemption price,
will cease.
Once holders surrender certificates in accordance with the redemption
notice, we will provide funds to pay, and will cause to be paid, the redemption
price indicated in the notice. Any shares so redeemed must be properly endorsed
or assigned for transfer, if our board of directors so requires and the
redemption notice so states. If fewer than all of the shares represented by any
certificate are redeemed, a new certificate will be issued representing the
unredeemed shares without cost to the holder thereof.
LIQUIDATION PREFERENCE. Upon our liquidation, dissolution or winding up,
the holders of shares of each series of our preferred stock will be entitled to
receive, out of our assets available for distribution to stockholders and before
any distribution of assets is made to or set apart for the holders of common
stock or any other shares of our stock ranking junior as to such a distribution
to the shares of that preferred series, an amount described in the applicable
prospectus supplement. If, upon our liquidation, dissolution or winding up, our
assets or the proceeds thereof are insufficient to pay in full the amounts
payable with respect to shares of each series of preferred stock and any other
shares of our stock ranking on a parity, as to any such distribution with that
series of preferred stock, the holders of shares of that series of preferred
stock and the other parity shares will share ratably in the distribution of our
assets in proportion to the full respective preferential amounts to which they
are entitled. After payment to the holders of shares of that series of preferred
stock of the full preferential amounts to which they are entitled, those holders
will not be entitled to any further participation in
10
<PAGE>
any distribution of assets by us, unless otherwise provided in the applicable
prospectus supplement. A consolidation or merger between us and one or more
corporations is not, for this purpose, a liquidation, dissolution or winding up.
The terms, if any, on which shares of any series of preferred stock are
convertible into or exchangeable for debt securities or common stock will be
contained in the applicable prospectus supplement. These terms may include
provisions for conversion or exchange, either mandatorily, at the option of the
holder or at our option, in which the number of shares of common stock to be
received by the holders of preferred stock would be calculated according to the
market price of common stock as of a time stated in the applicable prospectus
supplement.
DEPOSITARY SHARES
We may elect to offer fractional interests in shares of our preferred
stock, rather than full shares of preferred stock. In that case, we will cause a
bank or trust company we select, with its principal executive office in the
United States and a combined capital and surplus of at least $50,000,000 (a
"Depositary"), to issue to the public receipts (the "Depositary Receipts")
evidencing one or more fractional interests in a share of preferred stock we
deposit with the Depositary (the "Depositary Shares"). Each Depositary Share
will represent a fraction of a share of a particular series of preferred stock
as described below and detailed in the prospectus supplement relating to a
particular series of the preferred stock and the series of Depositary Shares
issued in respect thereof. The shares of any series of preferred stock
underlying the Depositary Shares will be deposited with a Depositary under a
separate deposit agreement (the "Deposit Agreement") between us and a
Depositary which may serve as a Depositary for more than one series of
Depositary Shares.
The following is a summary of the principal terms of the Depositary Shares
and the Deposit Agreement. This summary is not complete, may not contain all of
the information that is important to you and is qualified in its entirety by
reference to the Deposit Agreement and Depositary Receipts relating to each
series of preferred stock. We have filed the forms of Deposit Agreement and
Depositary Receipt as exhibits to the registration statement of which this
prospectus forms a part, or incorporate them by reference. Please review those
documents for further details not described in the summary below.
The applicable prospectus supplement relating to a series of Depositary
Shares will set forth the name and address of the principal executive office of
the Depositary. Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fraction of a
share of preferred stock represented by that Depositary Share, to all the rights
and preferences of the preferred stock represented by that Depositary Share,
including dividend, voting, redemption, conversion and liquidation rights.
We may order the Depositary to issue temporary Depositary Receipts to
holders in the event the definitive Depositary Receipts are not ready at the
time of distribution. The temporary Depositary Receipts will be substantially
identical to, and will entitle holders to all the rights pertaining to, the
definitive Depositary Receipts. We will then have definitive Depositary Receipts
prepared without unreasonable delay. Holders will be able to exchange temporary
Depositary Receipts for definitive Depositary Receipts at our expense.
Holders of Depositary Shares may surrender Depositary Receipts to the
Depositary (unless we have previously called for redemption of the related
Depositary Shares) and receive the number of whole shares of the related series
of preferred stock and any money or other property represented by those
Depositary Receipts. Holders will be entitled to receive whole shares of
preferred stock on the basis described in the applicable prospectus supplement.
After surrender of Depositary Receipts, holders will not be entitled to deposit
under the Deposit Agreement the shares of preferred stock received or to receive
Depositary Receipts for such shares of preferred stock. If the Depositary
Receipts delivered by the holder evidence a number of Depositary Shares in
excess of the number of Depositary Shares representing the number of whole
shares of preferred stock to be withdrawn, the Depositary will deliver to that
holder at the same time a new Depositary Receipt evidencing the excess number of
Depositary Shares.
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We do not expect that there will be any public trading market for the
preferred stock represented by Depositary Receipts except as represented by the
Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS. The Depositary will distribute all cash
dividends or other cash distributions received from us in respect of the
underlying shares of preferred stock to the record holders of Depositary Shares
relating to the preferred stock in proportion to the number of Depositary Shares
owned by those holders on the relevant record date. The Depositary will
distribute only the amount, however, that it can distribute without attributing
to any holder of Depositary Shares a fraction of one cent, and any balance it
does not distribute will be added to and treated as part of the next amount it
receives for distribution to record holders of Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received from us to the record holders of Depositary Shares
entitled to the distribution. If the Depositary determines that it is not
feasible to make such a distribution, it may, with our approval, sell the
property and distribute the net proceeds from that sale to those holders.
The Deposit Agreement will also contain provisions relating to the manner
in which the Depositary will make available to holders of Depositary Shares any
subscription or similar rights offered by us to holders of the series of
preferred stock underlying Depositary Shares.
REDEMPTION OF DEPOSITARY SHARES. If we decide to redeem a series of the
preferred stock represented by Depositary Shares, the Depositary will redeem the
Depositary Shares from the proceeds it will receive as a result of the
redemption of the underlying preferred stock. The Depositary will mail a notice
of redemption not less than 30 and not more than 60 days prior to the redemption
date to the addresses of the record holders of the Depositary Shares as they
appear in the Depositary's books. The redemption price per Depositary Share will
equal the applicable fraction of the redemption price per share payable with
respect to the underlying series of the preferred stock. Whenever we redeem
preferred stock held by the Depositary, the Depositary will redeem as of the
same redemption date the number of Depositary Shares representing the shares of
preferred stock so redeemed. If less than all the Depositary Shares are to be
redeemed, the Depositary will select the Depositary Shares to be redeemed,
either proportionately or by lot.
After the redemption date, the Depositary Shares called for redemption will
no longer be deemed to be outstanding and all rights of the holders of the
Depositary Shares will cease, except the right to receive the monies payable
upon redemption and any money or other property to which the holders of those
Depositary Shares were entitled upon redemption upon surrender to the Depositary
of the Depositary Receipts evidencing those Depositary Shares.
VOTING THE UNDERLYING PREFERRED STOCK. We will send to the Depositary all
notices of meetings at which the holders of shares of the series of preferred
stock held by the Depositary are entitled to vote. The Depositary will mail the
information contained in such a notice of meeting to the record holders of the
Depositary Shares relating to that series of preferred stock. Each record holder
of those Depositary Shares on the record date may instruct the Depositary how to
vote with respect to the number of shares of preferred stock represented by that
holder's Depositary Shares. The record date for Depositary Shares will be the
same date as the record date for the preferred stock. The Depositary will
endeavor, insofar as practicable, to vote the number of shares of preferred
stock underlying those Depositary Shares in accordance with any such
instructions. We will agree to take all actions deemed necessary by the
Depositary in order to enable the Depositary to do so. The Depositary will
abstain from voting shares of preferred stock for which it has not received
specific instructions from the holders of Depositary Shares representing those
shares of preferred stock.
TAXATION. The IRS will treat owners of Depositary Shares as if they were
owners of the preferred stock represented by those Depositary Shares, and,
accordingly, owners will be entitled to take into account for federal income tax
purposes, income and deductions to which they would be entitled if they were
holders of the preferred stock. In addition:
o owners will not recognize gain or loss for federal income tax purposes
upon the withdrawal of preferred stock in exchange for Depositary
Shares as provided in the Deposit Agreement;
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o the tax basis of each share of preferred stock to an exchanging owner
of Depositary Shares will, upon the exchange, be the same as the total
tax basis of the Depositary Shares exchanged; and
o the holding period for the preferred stock in the hands of an
exchanging owner of Depositary Shares will include the period during
which that person owned those Depositary Shares.
AMENDMENT AND TERMINATION OF THE DEPOSITARY AGREEMENT. We and the
Depositary may at any time amend the form of Depositary Receipts evidencing the
Depositary Shares and any provision of the Deposit Agreement. However, we may
not make any amendment that materially and adversely alters the rights of the
existing holders of Depositary Shares unless the record holders of at least a
majority of the Depositary Shares then outstanding approve the amendment. We or
the Depositary may terminate a Deposit Agreement only if:
o we have redeemed all Depositary Shares outstanding under the Deposit
Agreement; or
o there has been a final distribution in respect of the series of
preferred stock underlying the Depositary Shares in connection with
our liquidation, dissolution or winding up, and that distribution has
been made to the holders of the related Depositary Shares.
CHARGES OF DEPOSITARY. We will pay all transfer and other taxes and
governmental charges arising solely from the existence of the depositary
arrangements. We will also pay charges of the Depositary in connection with the
initial deposit of the underlying shares of preferred stock and any redemption
of the preferred stock. Holders of Depositary Shares must pay other transfer and
other taxes and governmental charges and such other charges that the Deposit
Agreement requires them to pay.
MISCELLANEOUS. We will provide to the Depositary, and the Depositary will
forward to the holders of Depositary Shares, all reports and communications from
us that we are required to furnish to the holders of the underlying preferred
stock.
Neither we nor the Depositary will be liable if we are or it is prevented
or delayed by law or any circumstance beyond our control in performing our
obligations under the Deposit Agreement. Our obligations and the Depositary's
obligations under the Deposit Agreement are limited to performance in good faith
of our and their respective duties under the Deposit Agreement. In addition,
neither we nor the Depositary will be obligated to prosecute or defend any legal
proceeding in respect of any Depositary Shares or shares of underlying preferred
stock unless satisfactory indemnity is furnished. We and the Depositary may rely
upon written advice of counsel or accountants, or information provided by
persons presenting preferred stock for deposit, holders of Depositary Shares or
other persons believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY. The Depositary may resign at any
time by delivering to us notice of its election to do so. We may also at any
time remove the Depositary. Any resignation or removal of the Depositary will
take effect upon our appointment of a successor Depositary and its acceptance of
that appointment. We must appoint a successor Depositary within 60 days after
delivery of any notice of resignation by, or removal of, the Depositary. The
successor Depositary must be a bank or trust company with its principal office
in the United States and must have a combined capital and surplus of at least
$50,000,000.
JUNIOR SUBORDINATED DEBT SECURITIES
The following is a summary of the principal terms of the junior
subordinated debt preferred securities in which Bank United Capital Trust will
invest the proceeds from the issuance and sale of the trust securities. This
summary is not complete, may not contain all the information that is important
to you, and is qualified in its entirety by reference to the junior subordinated
indenture, between us and the Bank of New York, as trustee (the "Indenture
Trustee"), the form of which is filed as an exhibit to the registration
statement of which this prospectus forms a part or is incorporated by reference,
as well as to the Trust Indenture Act. Wherever particular sections or defined
terms of the junior subordinated indenture are referred to, those sections or
defined terms are
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incorporated in this prospectus by reference as part of the statement made, and
the statement is qualified in its entirety by that reference.
Under certain circumstances involving the dissolution of Bank United
Capital Trust, subject to obtaining any required regulatory approval, junior
subordinated debt securities will be distributed to the holders of the trust
securities in liquidation of Bank United Capital Trust. See "Trust Preferred
Securities -- Special Event Redemption or Distribution."
If the junior subordinated debt securities are distributed to the holders
of the trust preferred securities, we will use our best efforts to have the
junior subordinated debt securities listed on any national securities exchange
or similar organization on which the trust preferred securities are then listed
or quoted.
The junior subordinated indenture will not contain covenants or other
provisions that would afford protection to the holders of the junior
subordinated debt securities in the event of a highly leveraged transaction,
reorganization, restructuring, merger or similar transaction involving us that
may adversely affect such holders.
We plan to sell junior subordinated debt securities to Bank United Capital
Trust under this prospectus. The applicable prospectus supplement relating to
the junior subordinated debt securities will contain the following terms:
o the title;
o any limit on the amount that may be issued;
o whether or not the junior subordinated debt securities will be issued
in global form, and if so, the terms and who the depository will be;
o the securities exchange, if any, on which the junior subordinated
debt securities will be listed;
o the maturity date(s);
o the annual interest rate(s) (which may be fixed or variable) or the
method for determining the rate(s) and the date(s) interest will begin
to accrue, the date(s) interest will be payable and the regular record
dates for interest payment dates or the method for determining those
date(s);
o the place(s) where payments will be payable;
o our right, if any, to defer payment of interest and the maximum length
of any deferral period;
o the date, if any, after which, and the price(s) at which, the junior
subordinated debt securities may, under any optional redemption
provisions, be redeemed at our option, and other related terms and
provisions;
o the date(s), if any, on which, and the price(s) at which we are
obligated, under any mandatory sinking fund provisions or otherwise,
to redeem, or at the holder's option to purchase, the junior
subordinated debt securities and other related terms and provisions;
o the denominations in which the junior subordinated debt securities
will be issued, if other than denominations of $1000 and any integral
multiple thereof; and
o any other terms, none of which will be inconsistent with the junior
subordinated indenture.
CONVERSION OR EXCHANGE RIGHTS. The terms on which the junior subordinated
debt securities may be convertible into or exchangeable for Class A common stock
or any of our other securities will be contained in the applicable prospectus
supplement. These terms will include provisions as to whether conversion or
exchange is mandatory, at the option of the holder or at our option, and may
include provisions under which the number of shares of Class A common stock or
other securities to be received by the holders of the junior subordinated debt
securities would be subject to adjustment.
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CONSOLIDATION, MERGER OR SALE. The junior subordinated indenture will not
contain any covenant which restricts our ability to merge or consolidate, or
sell, convey, transfer or otherwise dispose of all or substantially all of our
assets. Any successor or acquirer of such assets, however, must assume all of
our obligations under the junior subordinated indenture or the junior
subordinated debt securities, as appropriate.
ADDITIONAL INTEREST. Pursuant to the junior subordinated indenture, we
will agree to pay any taxes, duties, assessments or governmental charges of
whatever nature (other than withholding taxes) imposed by the United States or
any other taxing authority on Bank United Capital Trust, so that the net amounts
received and retained by Bank United Capital Trust after paying any such taxes,
duties, assessments or other governmental charges will be not less than the
amounts Bank United Capital Trust would have received had no such taxes, duties,
assessments or other governmental charges been imposed.
OPTION TO EXTEND INTEREST PAYMENT PERIOD. We can defer interest payments
by extending the interest payment period for the number of consecutive extension
periods specified in the applicable prospectus supplement (each, an "Extension
Period"). No Extension Period may extend beyond the maturity of the junior
subordinated debt securities. At the end of the Extension Period(s), we will pay
all interest then accrued and unpaid, together with interest thereon compounded
quarterly at the rate specified for the junior subordinated debt securities to
the extent permitted by applicable law. During any Extension Period, we will not
make distributions related to our capital stock, including dividends,
redemptions, repurchases, liquidation payments, or guarantee payments. We may,
however, make distributions in connection with any of the following:
o repurchases, redemptions or other acquisitions of shares of our
capital stock in connection with any employment contract, benefit plan
or other similar arrangement with or for the benefit of employees,
officers, directors or consultants;
o an exchange or conversion of any class or series of our capital stock
for any other class or series of our capital stock; or
o the purchase of fractional interests in shares of our capital stock
under the conversion or exchange provisions of our capital stock or
the security being converted or exchanged.
In addition, during any Extension Period, we will not make distributions related
to our debt securities that rank equally with or junior to the junior
subordinated debt securities, including any payment of interest, principal or
premium, or repayments, repurchases or redemptions. During Extension Periods, we
will, however, be able to pay stock dividends where the dividend stock is the
same stock as that on which the dividend is being paid.
Prior to the termination of any Extension Period, we may further defer
payments of interest by extending the Extension Period. However, an extended
Extension Period, including all previous and further extensions, may not extend
beyond the maturity of the junior subordinated debt securities. Upon the
termination of any Extension Period and the payment of all amounts then due, we
may commence a new Extension Period, subject to the terms described in this
section. Interest will not be due or payable during an Extension Period, except
at the end of the Extension Period.
We have no present intention of exercising our right to defer payments of
interest by extending the interest payment period on the junior subordinated
debt securities. If the Property Trustee is the sole holder of the junior
subordinated debt securities, we will give the Regular Trustees and the Property
Trustee notice of our selection of an Extension Period one business day before
the earlier of:
o the date distributions on the trust preferred securities would be
payable, if not for that Extension Period; and
o the date the Regular Trustees are required to give notice to the NYSE
or other applicable self-regulatory organization, or to holders of the
trust preferred securities, of the record date or the date that
distribution would be payable, if not for that Extension Period, but
in any event one business day before the record date.
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The Regular Trustees will give notice of our selection of an Extension
Period to the holders of the trust preferred securities. If the Property Trustee
is not the sole holder of the junior subordinated debt securities, we will give
the holders of the junior subordinated debt securities notice of our selection
of an Extension Period ten business days before the earlier of:
o the next succeeding interest payment date; and
o the date upon which we are required to give notice to the NYSE or
other applicable self-regulatory organization, or to holders of the
junior subordinated debt securities, of the record or payment date of
the related interest payment.
As used in this prospectus, the term "business day" means any day other
than Saturday, Sunday or any other day on which banking institutions in New York
City are permitted or required by any applicable law to close.
EVENTS OF DEFAULT UNDER THE JUNIOR SUBORDINATED INDENTURE. The following
are events of default under the junior subordinated indenture with respect to
junior subordinated debt securities that we may issue to Bank United Capital
Trust:
o our failure to pay interest when due and that failure continues for 30
days and the time for payment has not been extended or deferred;
o our failure to pay the principal, or premium, if any, when due;
o our failure to observe or perform any other covenant contained in the
junior subordinated debt securities or the junior subordinated
indenture, and that failure continues for 90 days after we receive
notice from the Indenture Trustee or holders of at least 25% of the
total principal amount of the outstanding junior subordinated debt
securities; and
o our bankruptcy, insolvency or reorganization.
If an event of default with respect to the junior subordinated debt
securities occurs and is continuing, the Indenture Trustee or the holders of at
least 25% of the total principal amount of the outstanding junior subordinated
debt securities, by notice in writing to us (and to the Indenture Trustee if
notice is given by those holders), may declare the unpaid principal of, premium,
if any, and accrued interest, if any, due and payable immediately.
The holders of at least a majority of the total liquidation amount of the
trust preferred securities may waive any default or event of default with
respect to the junior subordinated debt securities] and its consequences, except
defaults or events of default regarding:
o payment of principal, premium, if any, or interest; or
o certain covenants containing limitations on our ability to pay
dividends and make payments on debt securities in certain
circumstances.
Any such waiver will cure any default or event of default, other than those
described immediately above.
Subject to the terms of the junior subordinated indenture, if an event of
default under the junior subordinated indenture occurs and is continuing, the
Indenture Trustee will be under no obligation to exercise any of its rights or
powers under the junior subordinated indenture at the request or direction of
any of the holders of the junior subordinated debt securities, unless those
holders have offered reasonable indemnity to the Indenture Trustee. The holders
of at least a majority of the total liquidation amount of the trust preferred
securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Indenture Trustee, or
exercising any trust or power conferred on the Indenture Trustee, with respect
to the junior subordinated debt securities, provided that:
o it is not in conflict with any law or the applicable provisions of the
junior subordinated indenture;
o the Indenture Trustee may take any other action deemed proper by it
which is not inconsistent with such direction; but
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o subject to its duties under the Trust Indenture Act, the Indenture
Trustee need not take any action that might involve it in personal
liability or might be unduly prejudicial to the holders not involved
in the proceeding.
A holder of the junior subordinated debt securities will only have the
right to institute a proceeding under the junior subordinated indenture or to
appoint a receiver or trustee, or to seek other remedies if:
o the holder has given written notice to the Indenture Trustee of a
continuing event of default;
o the holders of at least 25% of the total principal amount of the
outstanding junior subordinated debt securities have made written
request, and those holders have offered reasonable indemnity to the
Indenture Trustee to institute the proceedings as trustee; and
o the Indenture Trustee does not institute the proceeding and does not
receive from the holders of a majority of the total principal amount
of the outstanding junior subordinated debt securities other
conflicting directions within 60 days after the relevant notice and
request and offer of reasonable indemnity to the Indenture Trustee.
These limitations, however, do not apply to a suit instituted by a holder of
junior subordinated debt securities if we default in the payment of the
principal, premium, if any, or interest on, the junior subordinated debt
securities.
We will periodically file statements with the Indenture Trustee regarding
our compliance with certain of the covenants in the junior subordinated
indenture.
If an event of default under the amended declaration has occurred and is
attributable to our failure to pay principal, premium, if any, or interest on,
the junior subordinated debt securities, then each holder of the trust preferred
securities may sue us or seek other remedies to force payment to that holder of
the principal of, premium, if any, or interest on, the junior subordinated debt
securities having a principal amount equal to the total liquidation amount of
the trust preferred securities held by that holder. If you sue us to collect
payment, then we will assume your rights as a holder of trust preferred
securities under the amended declaration to the extent we make a payment to you
in any similar legal action. The holders of trust preferred securities will not
be able to exercise directly any other remedy available to the holders of the
junior subordinated debt securities.
CERTAIN COVENANTS. If the junior subordinated debt securities are issued
to Bank United Capital Trust or a trustee of Bank United Capital Trust in
connection with the issuance of trust preferred securities by Bank United
Capital Trust, and
o there has occurred and is continuing an event of default under the
junior subordinated indenture,
o we are in default with respect to our payment of any obligations under
the trust preferred securities guarantee, or
o we have given notice of our election to defer payments of interest on
the junior subordinated debt securities by extending the interest
payment period as provided in the junior subordinated indenture and
that period, or any extension thereof, is continuing,
then:
o we may not make distributions related to our debt securities that rank
equally with or junior to the junior subordinated debt securities,
including any payment of interest, principal or premium, or
repayments, repurchases or redemptions, and
o may not make distributions related to our capital stock, including
dividends, redemptions, repurchases, liquidation payments, or
guarantee payments, except that we may make distributions in
connection with any of the following:
1) repurchases, redemptions or other acquisitions of shares of our
capital stock in connection with any employment contract,
benefit plan or other similar arrangement with or for the
benefit of employees, officers, directors or consultants,
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2) an exchange or conversion of any class or series of our capital
stock for any other class or series of our capital stock, or
3) the purchase of fractional interests in shares of our capital
stock under the conversion or exchange provisions of such
capital stock or the security being converted or exchanged.
These prohibitions will not, however, apply to any stock dividends we pay where
the dividend stock is the same class of stock as that on which the dividend is
being paid.
In addition, as long as the trust preferred securities remain outstanding,
we will covenant:
o to directly or indirectly maintain 100% ownership of the trust common
securities of Bank United Capital Trust; provided, however, that any
permitted successor of ours under the junior subordinated indenture
may succeed to our ownership of the trust common securities;
o to not voluntarily dissolve, wind-up or terminate Bank United Capital
Trust, except in connection with a distribution of junior subordinated
debt securities as described under "Distribution of the Junior
Subordinated Debt Securities" and in connection with certain mergers,
consolidations or amalgamations permitted by the amended declaration;
o to timely perform our duties as sponsor of Bank United Capital Trust;
and
o to use reasonable efforts to cause Bank United Capital Trust to
1) remain a statutory business trust, except in connection with
the distribution of junior subordinated debt securities to the
holders of trust preferred securities in the event of the
liquidation of Bank United Capital Trust, the redemption of all
of the trust preferred securities of Bank United Capital Trust,
or certain mergers, consolidations or amalgamations, each as
permitted by the amended declaration, and
2) otherwise continue to be classified as a grantor trust for U.S.
federal income tax purposes.
DISCHARGE AND DEFEASANCE. We may discharge all our obligations (except
those described below) to holders of the junior subordinated debt securities
issued under the junior subordinated indenture, which junior subordinated debt
securities have not already been delivered to the Indenture Trustee for
cancellation and which either have become due and payable or are by their terms
due and payable within one year, or are to be called for redemption within one
year, by depositing with the Indenture Trustee an amount certified to be
sufficient to pay when due the principal of and premium, if any, and interest on
all outstanding junior subordinated debt securities and to make any mandatory
sinking fund payments on those securities when due.
Unless otherwise specified in this prospectus with respect to the junior
subordinated debt securities:
(1) We, at our option, will be discharged from any and all obligations in
respect of the junior subordinated debt securities. However, we will
not be discharged from our obligations:
a) to pay all expenses of Bank United Capital Trust,
b) to register the transfer or exchange of junior subordinated debt
securities,
c) to replace mutilated, defaced, destroyed, lost or stolen junior
subordinated debt securities, and
d) to maintain paying agents and hold monies for payment in trust.
(2) If we deposit with the Indenture Trustee, in trust, money or U.S.
government obligations that through the payment of interest on that
money or those obligations and payment of their principal in
accordance with their terms will provide money in an amount sufficient
to pay all the principal of and premium, if any, and any interest on
the junior subordinated debt
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securities on the dates those payments are due, which may include one
or more redemption dates designated by us, in accordance with the
terms of the junior subordinated debt securities, then
a) we, at our option, need not comply with certain covenants
specified in this prospectus with respect to the junior
subordinated debt securities, and
b) the occurrence of an event described in the third bullet point of
the first paragraph under "-- Events of Default Under the Junior
Subordinated Indenture" above with respect to any defeased
covenant and any other event of default provided in the applicable
resolution of the board of directors or supplemental indenture
under which the junior subordinated debt securities are issued
will no longer be an event of default.
A trust described in clause (2) of the paragraph immediately above may only
be established, if, among other things, the Indenture Trustee has received an
opinion of counsel to the effect that the holders of the junior subordinated
debt securities will not recognize gain or loss for federal income tax purposes
as a result of any deposit or defeasance described in the paragraph immediately
above and will be subject to federal income tax in the same manner as if that
defeasance had not occurred, which, in the case of a discharge under clause (1)
above, must be based upon a ruling or administrative pronouncement of the IRS.
In the event we fail to comply with our remaining obligations under the junior
subordinated indenture after a defeasance of the junior subordinated indenture
with respect to the junior subordinated debt securities as described under
clause (2) above and the junior subordinated debt securities are declared due
and payable because of the occurrence of any undefeased event of default, the
amount of money and U.S. government obligations on deposit with the Indenture
Trustee may be insufficient to pay amounts due on the junior subordinated debt
securities at the time of the acceleration resulting from that event of default.
However, we will remain liable in respect of those payments.
MODIFICATION OF JUNIOR SUBORDINATED INDENTURE; WAIVER. Together with the
Indenture Trustee, we may change the junior subordinated indenture without the
consent of any holders with respect to a number of matters, including:
o to fix any ambiguity, defect or inconsistency in the junior
subordinated indenture; and
o to change anything that does not materially adversely affect the
interests of any holder of junior subordinated debt securities.
In addition, under the junior subordinated indenture, we and the Indenture
Trustee may change the rights of holders of the junior subordinated debt
securities with the written consent of the holders of at least a majority of the
total liquidation amount of the trust preferred securities. However, the
following changes may only be made with the consent of each holder of the junior
subordinated debt securities:
o extending the fixed maturity of the junior subordinated debt
securities;
o reducing the principal amount, reducing the rate of or extending the
time of payment of interest on or any premium payable upon the
redemption of any junior subordinated debt securities; or
o reducing the percentage of junior subordinated debt securities, the
holders of which are required to consent to any amendment or waive our
compliance with any covenant or past default.
If the consent of the Property Trustee, as holder of the junior
subordinated debt securities, is required to consent to any amendment,
modification or termination of the junior subordinated indenture, the Property
Trustee will request directions from the holders of the trust preferred
securities.
FORM, EXCHANGE, AND TRANSFER. The junior subordinated debt securities will
be issuable only in fully registered form without coupons and, unless otherwise
specified in the applicable prospectus supplement, in denominations of $1,000
and any integral multiple thereof.
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At the option of the holder, subject to the terms of the junior
subordinated indenture and the limitations applicable to global securities
described in the applicable prospectus supplement, junior subordinated debt
securities will be exchangeable for other junior subordinated debt securities,
in any authorized denomination and of like tenor and total principal amount.
Subject to the terms of the junior subordinated indenture and the
limitations applicable to global securities set forth in the applicable
prospectus supplement, junior subordinated debt securities may be presented for
exchange or for registration of transfer, duly endorsed or with the form of
transfer endorsed on them duly executed if we or the Indenture Trustee so
require, at the office of the security registrar or at the office of any
transfer agent we designate for that purpose. Unless otherwise provided in the
junior subordinated debt securities to be transferred or exchanged, no service
charge need be made for any registration of transfer or exchange, but we may
require the holder to pay any taxes or other governmental charges. We have
appointed the Indenture Trustee as security registrar. Any transfer agent in
addition to the security registrar we initially designate for any junior
subordinated debt securities will be named in the applicable prospectus
supplement. We may at any time designate additional transfer agents or rescind
the designation of any transfer agent or approve a change in the office through
which any transfer agent acts, except that we will be required to maintain a
transfer agent in each place of payment for the junior subordinated debt
securities.
If the junior subordinated debt securities are to be redeemed, we will not
be required to:
o issue, register the transfer of, or exchange any junior subordinated
debt securities during a period beginning at the opening of business
15 days before the day of mailing of a notice of redemption of any of
the junior subordinated debt securities that may be selected for
redemption and ending at the close of business on the day of such
mailing, or
o register the transfer of or exchange any junior subordinated debt
securities so selected for redemption, in whole or in part, except the
unredeemed portion of any of the junior subordinated debt securities
being redeemed in part.
INFORMATION CONCERNING THE JUNIOR SUBORDINATED INDENTURE TRUSTEE. The
Indenture Trustee, other than during the occurrence and continuance of an event
of default under the junior subordinated indenture, undertakes to perform only
the duties that are specifically contained in the junior subordinated indenture
and, upon an event of default under an junior subordinated indenture, must use
the same degree of care as a prudent person would exercise or use in the conduct
of his or her own affairs. Subject to this provision, the Indenture Trustee is
under no obligation to exercise any of the powers given to it by the junior
subordinated indenture at the request of any holder of junior subordinated debt
securities unless it is offered reasonable security and indemnity against the
costs, expenses and liabilities that it might incur. The Indenture Trustee is
not required to spend or risk its own money or otherwise become financially
liable while performing its duties unless it reasonably believes that it will be
repaid or receive adequate indemnity.
PAYMENT AND PAYING AGENTS. Unless otherwise indicated in the applicable
prospectus supplement, payment of the interest on any junior subordinated debt
securities on any interest payment date will be made to the person in whose name
those junior subordinated debt securities, or one or more predecessor
securities, are registered at the close of business on the regular record date
for such interest.
Principal of and any premium and interest on the junior subordinated debt
securities will be payable at the office of the paying agents designated by us,
except that, unless otherwise indicated in the applicable prospectus supplement,
interest payments may be made by check mailed to the holder. Unless otherwise
indicated in the prospectus supplement, the corporate trust office of the
Indenture Trustee in the City of New York will be designated as our sole paying
agent for payments with respect to junior subordinated debt securities. We will
be required to maintain a paying agent in each place of payment for the junior
subordinated debt securities.
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All monies we pay to a paying agent or the Indenture Trustee for the
payment of the principal of or any premium or interest on any junior
subordinated debt securities which remains unclaimed at the end of two years
after the principal, premium or interest has become due and payable will be
repaid to us, and the holder of the security thereafter may look only to us for
payment thereof.
SUBORDINATION OF JUNIOR SUBORDINATED DEBT SECURITIES. The junior
subordinated debt securities will be unsecured and will be subordinate and
junior in priority of payment to certain of our other indebtedness to the extent
described in the applicable prospectus supplement. The junior subordinated
indenture does not limit the amount of junior subordinated debt securities which
we may issue, nor does it limit us from issuing any other secured or unsecured
debt.
GLOBAL SECURITIES. The junior subordinated debt securities may be issued
in whole or in part in the form of one or more global securities that will be
deposited with, or on behalf of, a depositary identified in the applicable
prospectus supplement (the "Global Securities"). Global Securities will be
issued in registered form and in either temporary or permanent form. Unless and
until it is exchanged for junior subordinated debt securities in definitive
form, a temporary Global Security may not be transferred except as a whole by
the depositary for that Global Security to a nominee of the depositary or any
such nominee to a successor of the depositary or a nominee of that successor.
The specific terms of the depositary arrangement with respect to the junior
subordinated debt securities will be described in the applicable prospectus
supplement. We anticipate that the following provisions will apply to any
depositary arrangements.
Upon the issuance of a Global Security, the depositary for the Global
Security or its nominee will credit the accounts of persons held with it with
the respective principal amounts of the securities represented by the Global
Security. Those accounts will be designated by the underwriters or agents with
respect to those securities or by us if such securities are offered and sold
directly by us. Ownership of beneficial interests in a Global Security will be
limited to participants, who are persons that have accounts with the depositary
for the Global Security or its nominee, or persons that may hold interests
through participants. Ownership of beneficial interests in the Global Security
will be shown on, and the transfer of that ownership will be effected only
through, records maintained by the depositary, with respect to participants'
interests, for the Global Security or by participants or persons that hold
securities through participants with respect to beneficial owners' interests.
FEES AND EXPENSES. The junior subordinated indenture provides that we will
pay all fees and expenses related to:
o the offering of the trust preferred securities and the junior
subordinated debt securities;
o the organization, maintenance and dissolution of Bank United Capital
Trust;
o the retention of the Bank United Capital Trust trustees; and
o the enforcement by the Property Trustee of the rights of the holders
of the trust preferred securities.
GOVERNING LAW. The junior subordinated indenture and the junior
subordinated debt securities will be governed by and construed in accordance
with the laws of the State of New York except to the extent that the Trust
Indenture Act is applicable.
TRUST PREFERRED SECURITIES
The following is a summary of the principal terms of the trust preferred
securities. This summary is not complete, may not include all the information
that is important to you, and is qualified in its entirety by reference to the
amended declaration, the Delaware Business Trust Act and the Trust Indenture
Act. The amended declaration is filed as an exhibit to the registration
statement of which this prospectus forms a part, or is incorporated by
reference. The terms of the trust preferred securities will include those stated
in the amended declaration and those made part of the amended declaration by the
Trust Indenture Act.
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The amended declaration authorizes the Regular Trustees to issue, on behalf
of Bank United Capital Trust, two classes of trust securities, trust preferred
securities and trust common securities, each of which will have the terms
described in the applicable prospectus supplement. The proceeds from the sale of
the trust preferred securities will be used by Bank United Capital Trust to
purchase our junior subordinated debt securities. These junior subordinated debt
securities will be held in trust by the Property Trustee for the benefit of the
holders of the trust securities.
We will guarantee the payments of distributions and payments on redemption
or liquidation with respect to the trust preferred securities, but only to the
extent Bank United Capital Trust has funds available to make those payments and
has not made the payments. See "Guarantees."
The assets of Bank United Capital Trust available for distribution to the
holders of trust preferred securities will be limited to payments from us under
the junior subordinated debt securities held by Bank United Capital Trust. If we
fail to make a payment on the junior subordinated debt securities, Bank United
Capital Trust will not have sufficient funds to make related payments, including
distributions, on its trust preferred securities.
The trust preferred securities guarantee, when taken together with our
obligations under the junior subordinated debt securities, the junior
subordinated indenture related thereto and the amended declaration, will provide
a full and unconditional guarantee of amounts due on the trust preferred
securities issued by Bank United Capital Trust.
The trust preferred securities will have the terms, including
distributions, redemption, voting, liquidation rights and other preferred,
deferred or other special rights or restrictions that are described in the
amended declaration or made part of the amended declaration by the Trust
Indenture Act or the Delaware Business Trust Act. The terms of the trust
preferred securities will mirror the terms of the junior subordinated debt
securities held by Bank United Capital Trust. In other words, the distribution
rate and the distribution payment dates and other payment dates for the trust
preferred securities will correspond to the interest rate and interest payment
dates and other payment dates on the junior subordinated debt securities.
The applicable prospectus supplement will set forth the principal terms of
the trust preferred securities that will be offered, including:
o the name of the trust preferred securities;
o the liquidation amount and number of trust preferred securities
issued;
o the annual distribution rate(s) or method of determining such rate(s),
the payment date(s) and the record dates used to determine the holders
who are to receive distributions;
o the date from which distributions will be cumulative;
o the optional redemption provisions, if any, including the prices,
time periods and other terms and conditions on which the trust
preferred securities will be purchased or redeemed, in whole or in
part;
o the terms and conditions, if any, upon which the junior subordinated
debt securities and the related trust preferred securities guarantee
may be distributed to holders of those trust preferred securities;
o any securities exchange on which the trust preferred securities will
be listed;
o whether the trust preferred securities are to be issued in book-entry
form and represented by one or more global certificates, and if so,
the depository for those global certificates and the specific terms of
the depositary arrangements; and
o any other relevant rights, preferences, privileges, limitations or
restrictions of the trust preferred securities.
The applicable prospectus supplement will also describe certain U.S. federal
income tax considerations applicable to the purchase, holding and disposition of
such trust preferred securities.
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EXTENSIONS. We have the right under the junior subordinated indenture to
defer payments of interest on the junior subordinated debt securities by
extending the interest payment period from time to time on the junior
subordinated debt securities. The Regular Trustees will give the holders of the
trust preferred securities notice of any Extension Period upon their receipt of
notice thereof from us. If distributions are deferred, the deferred
distributions and accrued interest thereon will be paid to holders of record of
the trust preferred securities as they appear on the books and records of Bank
United Capital Trust on the record date next following the termination of such
deferral period. See "Description of the Junior Subordinated Debt
Securities -- Interest" and "-- Option to Extend Interest Payment Period."
Distributions on the trust preferred securities will be made on the dates
payable to the extent that Bank United Capital Trust has funds available for the
payment of distributions in the Property Account. Bank United Capital Trust's
funds available for distribution to the holders of the trust securities will be
limited to payments received from us on the junior subordinated debt securities.
We have guaranteed the payment of distributions out of monies held by Bank
United Capital Trust to the extent set forth under "-- Guarantees."
Distributions on the trust preferred securities will be payable to the
holders named on the securities register of Bank United Capital Trust at the
close of business on the relevant record dates, which, as long as the trust
preferred securities remain in book-entry only form, will be one business day
prior to the relevant payment dates. Distributions will be paid through the
Property Trustee who will hold amounts received in respect of the junior
subordinated debt securities in the Property Account for the benefit of the
holders of the trust securities. In the event that the trust preferred
securities do not continue to remain in book-entry only form, the relevant
record dates will conform to the rules of any securities exchange on which the
trust preferred securities are listed and, if none, the Regular Trustees will
have the right to select relevant record dates, which will be more than 14 days
but less than 60 days prior to the relevant payment dates. In the event that any
date on which distributions are to be made on the trust preferred securities is
not a business day, then payment of the distributions payable on that date will
be made on the next succeeding day which is a business day and without any
interest or other payment in respect of that delay, except that, if that
business day is in the next succeeding calendar year, the payment will be made
on the immediately preceding business day, in each case with the same force and
effect as if made on the record date.
MANDATORY REDEMPTION OF TRUST PREFERRED SECURITIES. The trust preferred
securities have no stated maturity date, but will be redeemed upon the maturity
of the junior subordinated debt securities or to the extent the junior
subordinated debt securities are redeemed prior to maturity. The junior
subordinated debt securities will mature on the date specified in the applicable
prospectus supplement and may be redeemed at any time, in whole but not in part,
in certain circumstances upon the occurrence of a Tax Event, an Investment
Company Event or a Regulatory Capital Event as described under "-- Special
Event Redemption."
Upon the maturity of the junior subordinated debt securities, the proceeds
of their repayment will simultaneously be applied to redeem all the outstanding
trust securities at the Redemption Price. Upon the redemption of the junior
subordinated debt securities, either at our option or as a result of a Tax
Event, an Investment Company Event or a Regulatory Capital Event, the proceeds
from the redemption will simultaneously be applied to redeem trust securities
having a total liquidation amount equal to the total principal amount of the
junior subordinated debt securities so redeemed at the redemption price;
provided, that holders of trust securities will be given not less than 30 nor
more than 60 days' notice of the redemption. In the event that fewer than all of
the outstanding trust securities are to be redeemed, the trust securities will
be redeemed proportionately.
SPECIAL EVENT REDEMPTION. Subject to obtaining any required regulatory
approval, if a Tax Event, an Investment Company Event or a Regulatory Capital
Event (each, a "Special Event") occurs and is continuing, we will have the
right, upon not less than 30 nor more than 60 days' notice, to redeem the junior
subordinated debt securities, in whole but not in part, for cash within 90 days
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following the occurrence of that Special Event. Following the redemption, Bank
United Capital Trust will use the proceeds to redeem all the outstanding trust
securities. However, if at the time there is available to us or Bank United
Capital Trust the opportunity to eliminate, within that 90-day period, the
Special Event by taking some ministerial action, such as filing a form or making
an election or pursuing some other similar reasonable measure that will have no
adverse effect on us, Bank United Capital Trust, or the holders of the trust
securities, then we or Bank United Capital Trust will pursue that measure in
lieu of redemption.
The following events constitute Special Events for purposes of the
redemption provisions described in the preceding paragraph.
o "TAX EVENT" means that the Regular Trustees have received an opinion
of independent tax counsel experienced in those matters to the effect
that, as a result of:
1) any amendment to, change or announced proposed change in, the
laws or regulations of the United States or any of its
political subdivisions or taxing authorities, or
2) any official administrative pronouncement, action or judicial
decision interpreting or applying those laws or regulations,
which amendment or change becomes effective or proposed change,
pronouncement, action or decision is announced on or after the
date the trust preferred securities are issued and sold
there is more than an insubstantial risk that:
a) Bank United Capital Trust is or within 90 days would be
subject to U.S. federal income tax with respect to income
accrued or received on the junior subordinated debt
securities,
b) interest payable to Bank United Capital Trust on the junior
subordinated debt securities is not or within 90 days would
not be deductible, in whole or in part, by us for U.S.
federal income tax purposes, or
c) Bank United Capital Trust is or within 90 days would be
subject to a material amount of other taxes, duties or
other governmental charges.
o "INVESTMENT COMPANY EVENT" means that the Regular Trustees have
received an opinion of a nationally recognized independent counsel to
the effect that, as a result of an amendment to or change in the
Investment Company Act or regulations thereunder on or after the date
the trust preferred securities are issued and sold, there is more than
an insubstantial risk that Bank United Capital Trust is or will be
considered an "investment company" and be required to be registered
under the Investment Company Act.
o "REGULATORY CAPITAL EVENT" means that we have received an opinion of
independent bank regulatory counsel experienced in those matters to
the effect that, as a result of
1) 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 the applicable
regulatory authorities having jurisdictions over us, or
2) any official administrative pronouncement or judicial decision
interpreting or applying those laws or regulations which is
announced or becomes effective after the date of original
issuance of the trust preferred securities,
the trust preferred securities do not constitute, or within 90 days of
the date of that event would not constitute, Tier 1 capital or its then
equivalent applied as if we were a bank holding company, as that
concept is used in the guidelines or regulations issued by the Board of
Governors of the Federal Reserve System. However, the distribution of
junior subordinated debt securities by Bank United Capital Trust in
connection with its liquidation will not, in and of itself, be a
"Regulatory Capital Event" unless the liquidation occurs in
connection with a Tax Event or an Investment Company Event.
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DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBT SECURITIES. We will have the
right at any time to dissolve Bank United Capital Trust and, after satisfaction
of the liabilities of creditors of Bank United Capital Trust as provided by
applicable law, to cause junior subordinated debt securities to be distributed
to the holders of the trust preferred securities in a total stated principal
amount equal to the total stated liquidation amount of the trust preferred
securities then outstanding. Prior to any such dissolution, we will obtain any
required regulatory approvals. The right to dissolve the trust and distribute
the junior subordinated debt securities will be conditioned on our receipt of an
opinion rendered by an independent tax counsel that the distribution would not
result in the recognition of gain or loss for federal income tax purposes by the
holders.
If the junior subordinated debt securities are distributed to the holders
of the trust securities, we will use our best efforts to cause the junior
subordinated debt securities to be listed on the NYSE or on any other exchange
that the trust preferred securities are then listed.
After the date for any distribution of junior subordinated debt securities
upon dissolution of Bank United Capital Trust:
o the trust preferred securities will no longer be deemed to be
outstanding;
o the securities depositary or its nominee, as the record holder of the
trust preferred securities, will receive a registered global
certificate or certificates representing the junior subordinated debt
securities to be delivered upon such distribution; and
o any certificates representing trust preferred securities not held by
the depositary or its nominee will be deemed to represent junior
subordinated debt securities having a total principal amount equal to
the total stated liquidation amount of, with an interest rate
identical to the distribution rate of, and with accrued and unpaid
interest equal to accrued and unpaid distributions on, those trust
preferred securities until those certificates are presented to us or
our agent for transfer or reissuance.
We cannot provide any assurance as to the market prices for either the
trust preferred securities or the junior subordinated debt securities that may
be distributed in exchange for the trust preferred securities if a dissolution
and liquidation of Bank United Capital Trust were to occur. Accordingly, the
trust preferred securities that an investor may purchase, whether as a result of
the offer made through this prospectus or in the secondary market, or the junior
subordinated debt securities that an investor may receive if a dissolution and
liquidation of Bank United Capital Trust were to occur, may trade at a discount
to the price that the investor paid to purchase the trust preferred securities
offered through this prospectus.
REDEMPTION PROCEDURES. Bank United Capital Trust may not redeem fewer than
all the outstanding trust securities unless all accrued and unpaid distributions
have been paid on all trust securities for all distribution periods terminating
on or before the date of redemption. In the event that fewer than all of the
outstanding trust securities are to be redeemed, the trust securities will be
redeemed proportionately.
If Bank United Capital Trust gives a notice of redemption in respect of the
trust securities, which notice will be irrevocable, then, by 12:00 noon, New
York City time, on the redemption date, and if we have paid to the Property
Trustee a sufficient amount of cash in connection with the related redemption or
maturity of the junior subordinated debt securities, the Property Trustee will
irrevocably deposit with the depositary funds sufficient to pay the applicable
Redemption Price and will give the depositary irrevocable instructions and
authority to pay the Redemption Price to the holders of the trust preferred
securities, and the paying agent will pay the applicable Redemption Price to the
holders of the trust common securities by check. If notice of redemption has
been given and funds deposited as required, then, immediately prior to the close
of business on the date of the deposit, distributions will cease to accrue and
all rights of holders of trust preferred securities so called for redemption
will cease, except the right of the holders of the trust preferred securities to
receive the Redemption Price but without interest on the Redemption Price. In
the event that any date fixed for redemption of trust
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preferred securities is not a business day, then payment of the Redemption Price
payable on that date will be made on the next succeeding day that is a business
day, without any interest or other payment in respect of any such delay, except
that, if that business day falls in the next calendar year, payment will be made
on the immediately preceding business day. In the event that payment of the
Redemption Price in respect of trust preferred securities is improperly withheld
or refused and not paid either by Bank United Capital Trust or by us under the
trust preferred securities guarantee, distributions on the trust preferred
securities will continue to accrue at the then applicable rate from the original
redemption date to the 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.
Subject to the foregoing and applicable law, including, without limitation,
U.S. federal securities laws, we or our subsidiaries may at any time, and from
time to time, purchase outstanding trust preferred securities by tender, in the
open market or by private agreement.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION. The amended declaration states
that Bank United Capital Trust will be dissolved:
o on the expiration of the term of Bank United Capital Trust;
o upon our bankruptcy;
o upon the filing of a certificate of dissolution or its equivalent with
respect to us;
o upon the filing of a certificate of cancellation with respect to Bank
United Capital Trust after obtaining the consent of at least a
majority in liquidation amount of the trust preferred securities,
voting together as a single class;
o 90 days after the revocation of our charter, but only if the charter
is not reinstated during that 90-day period;
o upon the distribution of the related junior subordinated debt
securities directly to the holders of the trust securities;
o upon the redemption of all of the trust securities; or
o upon entry of a court order for the dissolution of us or Bank United
Capital Trust.
In the event of a dissolution, after Bank United Capital Trust pays all
amounts owed to creditors, the holders of the trust preferred securities will be
entitled to receive:
o cash equal to the total liquidation amount of each trust preferred
security specified in an accompanying prospectus supplement, plus
accumulated and unpaid distributions to the date of payment, or
o junior subordinated debt securities in a total principal amount equal
to the total liquidation amount of the trust preferred securities.
If Bank United Capital Trust cannot pay the full amount due on its trust
securities because insufficient assets are available for payment, then the
amounts payable by Bank United Capital Trust on its trust securities will be
paid proportionately. However, if an event of default under the related amended
declaration has occurred, the total amounts due on the trust preferred
securities will be paid before any distribution on the trust common securities.
DECLARATION EVENTS OF DEFAULT. An event of default under the junior
subordinated indenture relating to the junior subordinated debt securities is an
event of default under the amended declaration (a "Declaration Event of
Default"). See "-- Junior Subordinated Debt Securities -- Events of Default
Under the Junior Subordinated Indenture."
In addition, the voluntary or involuntary dissolution, winding up or
termination of Bank United Capital Trust is also a Declaration Event of Default,
except in connection with:
o the distribution of the junior subordinated debt securities to holders
of the trust securities of Bank United Capital Trust,
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o the redemption of all of the trust securities of Bank United Capital
Trust, and
o mergers, consolidations or amalgamations permitted by the amended
declaration of Bank United Capital Trust.
Under the amended declaration, the holder of the trust common securities
will be deemed to have waived any Declaration Event of Default with respect to
the trust common securities until all Declaration Events of Default with respect
to the trust preferred securities have been cured, waived or otherwise
eliminated. Until all Declaration Events of Default with respect to the trust
preferred securities 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 trust preferred securities and only the holders of the trust preferred
securities will have the right to direct the Property Trustee with respect to
certain matters under the amended declaration and the junior subordinated
indenture. In the event that any Declaration Event of Default with respect to
the trust preferred securities is waived by the holders of the trust preferred
securities as provided in the amended declaration, under the amended declaration
the holders of trust common securities have agreed that the waiver also
constitutes a waiver of the Declaration Event of Default with respect to the
trust common securities for all purposes under the amended declaration without
any further act, vote or consent of the holders of trust common securities.
We and the Regular Trustees must file annually with the Property Trustee a
certificate evidencing compliance with all the applicable conditions and
covenants under the amended declaration.
Upon the occurrence of a Declaration Event of Default, the Property
Trustee, as the sole holder of the junior subordinated debt securities, will
have the right under the junior subordinated indenture to declare the principal
of, premium, if any, and interest on the junior subordinated debt securities to
be immediately due and payable.
If a Property Trustee fails to enforce its rights under the amended
declaration or the junior subordinated indenture to the fullest extent permitted
by law and subject to the terms of the amended declaration and the junior
subordinated indenture, any holder of trust preferred securities may sue us, or
seek other remedies, to enforce the Property Trustee's rights under the amended
declaration or the junior subordinated indenture without first instituting a
legal proceeding against the Property Trustee or any other person. If a
Declaration Event of Default occurs and is continuing as a result of our failure
to pay principal of or premium, if any, or interest on the junior subordinated
debt securities when payable, then a holder of the trust preferred securities
may directly sue us or seek other remedies, to collect its proportionate share
of payments owned. See "Relationship Among The Trust Preferred Securities, The
Trust Preferred Securities Guarantee And The Junior Subordinated Notes Held By
Bank United Capital Trust."
REMOVAL AND REPLACEMENT OF TRUSTEES. Only the holders of trust common
securities have the right to remove or replace the trustees of Bank United
Capital Trust, except that while an event of default in respect of the junior
subordinated debt securities has occurred or is continuing, the holders of a
majority of the trust preferred securities will have this right. The resignation
or removal of any trustee and the appointment of a successor trustee will be
effective only on the acceptance of appointment by the successor trustee in
accordance with the provisions of the amended declaration.
CONVERSION OR EXCHANGE RIGHTS. The terms on which the trust preferred
securities are convertible into or exchangeable for common stock or our other
securities will be contained in the applicable prospectus supplement. Those
terms will include provisions as to whether conversion or exchange is mandatory,
at the option of the holder or at our option, and may include provisions under
which the number of shares of common stock or our other securities to be
received by the holders of trust preferred securities would be subject to
adjustment.
MERGERS, CONSOLIDATIONS OR AMALGAMATIONS OF BANK UNITED CAPITAL
TRUST. Bank United Capital Trust may not consolidate, amalgamate, merge with or
into, or be replaced by or convey, transfer or lease their properties and assets
substantially as an entirety to any other corporation or other body (each, a
"Merger Event"), except as described below. Bank United Capital Trust may,
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with the consent of a majority of its Regular Trustees and without the consent
of the holders of its trust securities, consolidate, amalgamate, merge with or
into, or be replaced by another trust, provided that:
o the successor entity either
1) assumes all of the obligations of Bank United Capital Trust
relating to its trust securities, or
2) substitutes other securities for the trust securities that are
substantially similar to the trust securities, so long as the
successor securities rank the same as the trust securities for
distributions and payments upon liquidation, redemption and
otherwise;
o we acknowledge a trustee of the successor entity who has the same
powers and duties as the Property Trustee of Bank United Capital
Trust, as the holder of the junior subordinated debt securities;
o the trust preferred securities are listed, or any successor securities
will be listed, upon notice of issuance, on the same securities
exchange or other organization that the trust preferred securities are
then listed;
o the Merger Event does not cause the trust preferred securities or
successor securities to be downgraded by any nationally recognized
rating agency;
o the Merger Event does not adversely affect the rights, preferences and
privileges of the holders of the trust securities or successor
securities in any material way, other than with respect to any
dilution of the holders' interest in the new entity;
o the successor entity has a purpose identical to that of Bank United
Capital Trust;
o prior to the Merger Event, we have received an opinion of counsel from
a nationally recognized law firm stating that
1) the Merger Event does not adversely affect the rights of the
holders of the trust preferred securities or any successor
securities in any material way, other than with respect to any
dilution of the holders' interest in the new entity, and
2) following the Merger Event, neither Bank United Capital Trust nor
the successor entity will be required to register as an investment
company under the Investment Company Act; and
o we guarantee the obligations of the successor entity under the
successor securities in the same manner as in the trust preferred
securities guarantee.
In addition, unless all of the holders of the trust preferred securities
and trust common securities approve otherwise, Bank United Capital Trust will
not consolidate, amalgamate, merge with or into, or be replaced by any other
entity or permit any other entity to consolidate, amalgamate, merge with or
into, or replace it, if, in the opinion of a nationally recognized tax counsel
experienced in such matters, the transaction would cause Bank United Capital
Trust or the successor entity to be classified other than as a grantor trust for
U.S. federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF DECLARATION. The holders of trust preferred
securities have no voting rights except as discussed under " -- Mergers,
Consolidations or Amalgamations of Bank United Capital Trust" and
"Guarantees -- Amendments and Assignment," and as otherwise required by law
and the amended declaration.
The amended declaration may be amended if approved by a majority of the
Regular Trustees of Bank United Capital Trust. However, if any proposed
amendment provides for, or the Regular Trustees otherwise propose to effect,
1) any action that would adversely affect the powers, preferences or
special rights of the trust securities, whether by way of amendment
to the amended declaration or otherwise, or
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2) the dissolution, winding-up or termination of Bank United Capital
Trust other than under the terms of its amended declaration,
then the holders of the trust preferred securities as a single class will be
entitled to vote on the amendment or proposal. In that case, the amendment or
proposal will only be effective if approved by at least a majority in
liquidation amount of the trust preferred securities affected by the amendment
or proposal.
No amendment may be made to an amended declaration if that amendment would:
o cause Bank United Capital Trust to be characterized as other than a
grantor trust for U.S. federal income tax purposes;
o reduce or otherwise adversely affect the powers of the Property
Trustee; or
o cause Bank United Capital Trust to be deemed to be an "investment
company" which is required to be registered under the Investment
Company Act.
The holders of a majority of the total liquidation amount of the trust
preferred securities have the right to:
o direct the time, method and place of conducting any proceeding for any
remedy available to the Property Trustee; or
o direct the exercise of any trust or power conferred upon the Property
Trustee under the amended declaration, including the right to direct
the Property Trustee, as the holder of the junior subordinated debt
securities, to
1) exercise the remedies available under the junior subordinated
indenture with respect to the junior subordinated debt securities,
2) waive any event of default under the junior subordinated indenture
that is waivable, or
3) cancel an acceleration of the principal of the junior subordinated
debt securities.
However, if the junior subordinated indenture requires the consent of the
holders of a super-majority of the total principal amount of the junior
subordinated debt securities, then the Property Trustee must get approval of the
holders of a super-majority in liquidation amount of the trust preferred
securities.
In addition, before taking any of the foregoing actions, the Property
Trustee must obtain an opinion of counsel stating that, as a result of that
action, Bank United Capital Trust will continue to be classified as a grantor
trust for U.S. federal income tax purposes.
The Property Trustee will notify all trust preferred securities holders of
any notice received from the Indenture Trustee with respect to the junior
subordinated debt securities held by Bank United Capital Trust.
As described in the amended declaration, the Property Trustee may hold a
meeting to have holders of trust preferred securities vote on a change or have
them approve a change by written consent.
If a vote by the holders of trust preferred securities is taken or a
consent is obtained, any trust preferred securities that are owned by us or any
of our affiliates will, for purposes of the vote or consent, be treated as if
they were not outstanding, which will have the following consequences:
o we and any of our affiliates will not be able to vote on or consent to
matters requiring the vote or consent of holders of trust preferred
securities; and
o any trust preferred securities owned by us or any of our affiliates
will not be counted in determining whether the required percentage of
votes or consents has been obtained.
INFORMATION CONCERNING THE PROPERTY TRUSTEE. For matters relating to
compliance with the Trust Indenture Act, the Property Trustee will have all of
the duties and responsibilities of an indenture trustee under the Trust
Indenture Act. The Property Trustee, other than during the occurrence and
continuance of a Declaration Event of Default, undertakes to perform only the
duties that are
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specifically described in the amended declaration and, upon a Declaration Event
of Default, must use 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 given it by the applicable amended declaration at the request of any
holder of trust preferred securities unless it is offered reasonable security or
indemnity against the costs, expenses and liabilities that it might incur.
However, the holders of the trust preferred securities will not be required to
offer such an indemnity where the holders, by exercising their voting rights,
direct the Property Trustee to take any action following a Declaration Event of
Default.
MISCELLANEOUS. The Regular Trustees are authorized and directed to conduct
the affairs of and to operate Bank United Capital Trust in a way that:
o will not cause it to be deemed to be an "investment company" required
to be registered under the Investment Company Act;
o will cause it to be classified as a grantor trust for U.S. federal
income tax purposes; and
o will cause the junior subordinated debt securities it holds to be
treated as our indebtedness for U.S. federal income tax purposes.
We and the Regular Trustees are authorized to take any action, so long as
it is consistent with applicable law or the certificate of trust or amended
declaration, that we and the Regular Trustees determine to be necessary or
desirable for those purposes.
Holders of trust preferred securities have no preemptive or similar rights.
Bank United Capital Trust may not borrow money, issue debt, execute
mortgages or pledge any of its assets.
GOVERNING LAW. The amended declaration and the related trust preferred
securities will be governed by and construed in accordance with the laws of the
State of Delaware.
GUARANTEES
We will execute a trust preferred securities guarantee, for the benefit of
the holders of trust preferred securities, at the time that Bank United Capital
Trust issues the trust preferred securities. The trust preferred securities
guarantee will be qualified as an indenture under the Trust Indenture Act. The
Bank of New York will act as the trustee (the "Guarantee Trustee") under the
trust preferred securities guarantee for the purposes of compliance with the
Trust Indenture Act. The terms of the trust preferred securities guarantee will
be those contained in the trust preferred securities guarantee and those made
part of the trust preferred securities guarantee by the Trust Indenture Act. The
following is a summary of the principal terms of the trust preferred securities
guarantee. This summary is not complete and is qualified in its entirety by
reference to the form of trust preferred securities guarantee, which is filed as
an exhibit to the registration statement of which this prospectus forms a part
or is incorporated by reference, and the Trust Indenture Act. The Guarantee
Trustee will hold the trust preferred securities guarantee for the benefit of
the holders of trust preferred securities.
We will irrevocably agree, as described in the trust preferred securities
guarantee, to pay in full, to the holders of the trust preferred securities
issued by Bank United Capital Trust, the trust preferred securities guarantee
payments, except to the extent previously paid, when and as due, regardless of
any defense, right of set-off or counterclaim which Bank United Capital Trust
may have or assert. The following payments, to the extent not paid by Bank
United Capital Trust, will be covered by the trust preferred securities
guarantee:
o any accrued and unpaid distributions required to be paid on the trust
preferred securities, to the extent that Bank United Capital Trust has
funds available to make the payment;
o the redemption price, to the extent that Bank United Capital Trust has
funds available to make the payment; and
o upon a voluntary or involuntary dissolution and liquidation of Bank
United Capital Trust, other than in connection with a distribution of
junior subordinated debt securities to
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holders of the trust preferred securities or the redemption of all the
trust preferred securities, the lesser of
1) the total of the liquidation amount specified in the prospectus
supplement for each trust preferred security plus all accrued and
unpaid distributions on the trust preferred securities to the date
of payment, to the extent Bank United Capital Trust has funds
available to make the payment, and
2) amount of assets of Bank United Capital Trust remaining available
for distribution to holders of its trust preferred securities upon
a dissolution and liquidation of the trust.
Our obligation to make a trust preferred securities guarantee payment may
be satisfied by directly paying the required amounts to the holders of the trust
preferred securities or by causing Bank United Capital Trust to pay the amounts
to the holders.
The trust preferred securities guarantee will be a guarantee on a
subordinated basis with respect to the trust preferred securities from the time
of issuance of the trust preferred securities, but will not apply to any payment
of distributions or redemption price, or to payments upon the dissolution,
winding-up or termination of Bank United Capital Trust, except to the extent
Bank United Capital Trust has funds available therefor. If we do not make
interest payments on the junior subordinated debt securities, Bank United
Capital Trust will not pay distributions on the trust preferred securities and
will not have funds available therefor. See "-- Junior Subordinated Debt
Securities."
No single document executed by us relating to the issuance of trust
preferred securities will provide for our full, irrevocable and unconditional
guarantee of the trust preferred securities. It is our obligations under the
junior subordinated indenture, the trust preferred securities guarantee and
amended declaration taken together that have the effect of providing a full,
irrevocable and unconditional guarantee of the trust's obligations under its
trust preferred securities.
STATUS OF THE TRUST PREFERRED SECURITIES GUARANTEE. Our obligations under
the trust preferred securities guarantee will rank junior in priority of payment
to all of our senior indebtedness. This means that we cannot make any payments
on the trust preferred securities guarantee if we default on a payment of senior
indebtedness and do not cure the default within the applicable grace period, or
if the senior indebtedness becomes immediately due because of a default and has
not yet been paid in full. In addition, our obligations under the trust
preferred securities guarantee will rank junior to all existing and future
liabilities of our subsidiaries.
The amended declaration will require that the holder of trust preferred
securities accept the subordination provisions and other terms of the trust
preferred securities guarantee. The trust preferred securities guarantee will
constitute a guarantee of payment and not of collection. In other words, the
holder of the guaranteed security may sue us, or seek other remedies, to enforce
its rights under the trust preferred securities guarantee without first suing
any other person or entity. A trust preferred securities guarantee will not be
discharged except by payment of the trust preferred securities guarantee
payments in full to the extent not previously paid or upon distribution of the
junior subordinated debt securities to the holders of trust preferred securities
under the amended declaration.
MATERIAL COVENANTS RELATED TO THE TRUST PREFERRED SECURITIES GUARANTEE. In
the trust preferred securities guarantee, we will covenant that, so long as any
trust preferred securities remain outstanding, if there is an event of default
under the trust preferred securities guarantee or the amended declaration:
o we will not make distributions related to our debt securities that
rank equally with or junior to the junior subordinated debt
securities, including any payment of interest, principal or premium,
or repayments, repurchases or redemptions; and
o we will not make distributions related to our capital stock, including
dividends, redemptions, repurchases, liquidation payments, or
guarantee payments. We may, however, make distributions in connection
with any of the following:
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1) repurchases, redemptions or other acquisitions of shares of our
capital stock in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of
employees, officers, directors or consultants,
2) an exchange or conversion of any class or series of our capital
stock for any other class or series of our capital stock, or
3) the purchase of fractional interests in shares of our capital
stock under the conversion or exchange provisions of such capital
stock or the security being converted or exchanged.
The trust preferred securities guarantee, however, will except from the above
any stock dividends paid by us where the dividend stock is the same stock as
that on which the dividend is being paid.
AMENDMENTS AND ASSIGNMENT. Except with respect to any changes which do not
adversely affect the rights of holders of trust preferred securities in any
material respect, in which case no consent of those holders will be required, a
trust preferred securities guarantee may only be amended with the prior approval
of the holders of at least a majority of the total liquidation amount of the
trust preferred securities, excluding any such trust preferred securities held
by us or any of our affiliates. A description of the requirements for obtaining
any approval is described under "Trust Preferred Securities -- Voting Rights;
Amendment of Declaration." All guarantees and agreements contained in the trust
preferred securities guarantee will be binding on our successors, assigns,
receivers, trustees and representatives and are for the benefit of the holders
of the applicable trust preferred securities.
TRUST PREFERRED SECURITIES GUARANTEE EVENTS OF DEFAULT. An event of
default under the trust preferred securities guarantee will occur if we fail to
make any of our required payments or perform our obligations under the trust
preferred securities guarantee.
The holders of at least a majority of the total liquidation amount of the
trust preferred securities, excluding any trust preferred securities held by us
or any of our affiliates, will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Guarantee
Trustee or to direct the exercise of any trust or power given to the Guarantee
Trustee under the trust preferred securities guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE. The Guarantee Trustee under
the trust preferred securities guarantee, other than during the occurrence and
continuance of an event of default under the trust preferred securities
guarantee, will only perform the duties that are specifically described in such
trust preferred securities guarantee. After such a default, the Guarantee
Trustee will exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Guarantee Trustee is under no obligation to exercise any of its
powers as described in the trust preferred securities guarantee at the request
of any holder of covered trust preferred securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that it might
incur.
TERMINATION OF THE TRUST PREFERRED SECURITIES GUARANTEE. The trust
preferred securities guarantee will terminate once the trust preferred
securities are paid in full or upon distribution of the junior subordinated debt
securities to the holders of the trust preferred securities. The trust preferred
securities guarantee will continue to be effective or will be reinstated if at
any time any holder of trust preferred securities must restore payment of any
sums paid under the trust preferred securities or the trust preferred securities
guarantee.
GOVERNING LAW. The trust preferred securities guarantee will be governed
by and construed in accordance with the laws of the State of New York.
STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
We may issue stock purchase contracts, including contracts obligating
holders to purchase from us, and we to sell to the holders, a specified number
of shares of common stock at a future date or dates. The consideration per share
of common stock may be fixed at the time the stock purchase contracts are issued
or may be determined by reference to a specific formula described in the stock
purchase contracts. We may issue the stock purchase contracts separately or as a
part of stock
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purchase units consisting of a stock purchase contract and one or more shares of
our preferred stock or fractions thereof or a debt security or a debt obligation
of us or a third party, including a U.S. Treasury security. Our preferred stock
or our debt security or the debt obligation of a third party may serve as
collateral to secure the holders' obligations to purchase the shares of common
stock under the stock purchase contracts. The stock purchase contracts may
require us to make periodic payments to the holders of stock purchase contracts.
These payments may be unsecured or prefunded on some basis. The stock purchase
contracts may require holders to secure their obligations in a specified manner.
The applicable prospectus supplement will describe the specific terms of any
stock purchase contracts or stock purchase units.
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES,
THE TRUST PREFERRED SECURITIES GUARANTEE
AND THE JUNIOR SUBORDINATED NOTES HELD BY BANK UNITED CAPITAL TRUST
We will guarantee payments of distributions and redemption and liquidation
payments due on the trust preferred securities, to the extent the trust has
funds available for the payments, to the extent described under "Description of
Offered Securities -- Guarantees." No single document executed by us in
connection with the issuance of the trust preferred securities will provide for
our full, irrevocable and unconditional guarantee of the trust preferred
securities. It is only the combined operation of our obligations under the trust
preferred securities guarantee, the amended declaration and the junior
subordinated indenture that has the effect of providing a full, irrevocable and
unconditional guarantee of Bank United Capital Trust's obligations under the
trust preferred securities.
As long as we make payments of interest and other payments when due on the
junior subordinated debt securities held by Bank United Capital Trust, those
payments will be sufficient to cover the payment of distributions and redemption
and liquidation payments due on the trust preferred securities issued by Bank
United Capital Trust, primarily because:
o the total principal amount of the junior subordinated debt securities
will be equal to the sum of the total liquidation amount of the trust
securities;
o the interest rate and interest and other payment dates on the junior
subordinated debt securities will match the distribution rate and
distribution and other payment dates for the trust preferred
securities;
o we will pay for any and all costs, expenses and liabilities of
Bank United Capital Trust except its obligations under its trust
preferred securities; and
o each amended declaration provides that Bank United Capital Trust
will not engage in any activity that is not consistent with the
limited purposes of Bank United Capital Trust.
If and to the extent that we do not make payments on the junior
subordinated debt securities, Bank United Capital Trust will not have funds
available to make payments of distributions or other amounts due on its trust
preferred securities. In those circumstances, you will not be able to rely upon
the trust preferred securities guarantee for payment of these amounts. Instead,
you may directly sue us or seek other remedies to collect your proportionate
share of payments owed. If you sue us to collect payment, then we will assume
your rights as a holder of trust preferred securities under the amended
declaration to the extent we make a payment to you in any such legal action.
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SELLING STOCKHOLDERS
The selling stockholders are the general partners and some of the limited
partners of Hyperion Partners L.P., a Delaware limited partnership, and three
other entities with which an affiliate of Hyperion Partners has a fiduciary
relationship. The applicable prospectus supplement for any offering of Class A
common stock by selling stockholders will include the following information:
o the name of the selling stockholders;
o the number of shares held by each of the selling stockholders;
o the percentage of the class of shares held by each of the selling
stockholders; and
o the number of shares of Class A common stock offered by each of the
selling stockholders.
SELLING STOCKHOLDER LETTER AGREEMENT
The following summary of the material provisions of the letter agreement
that affects the selling stockholders is qualified in its entirety by reference
to the letter agreement that we filed as an exhibit to the registration
statement on Form S-1 (File No. 333-06229), which we filed with the Commission
on August 7, 1996 in connection with our IPO. Please review the exhibit for
further details not described in the summary in this section.
In connection with our IPO in August, 1996, some of the holders of our
common stock, including all of the selling stockholders with the exception of
the FDIC, entered into a letter agreement with us. This letter agreement
restricts the holders' ability to sell our common stock, other than the shares
sold in the IPO, for a specific period of time. Under the terms of the letter
agreement, each selling stockholder who retained shares of common stock
following the IPO was not permitted to sell such shares for (1) one year after
the IPO, if the stock was received in respect of general partnership interests
in Hyperion Partners, or (2) six months after the IPO, if the stock was received
in respect of limited partnership interests in Hyperion Partners (although a
regulated New Jersey insurance company was permitted to sell shares in a private
off-market transaction subject to Rule 144 limits and reasonable representations
requested by the underwriters). Each holder of 5% or more of our common stock
was permitted to sell up to 45% of such holder's shares of common stock in the
IPO, except for certain affiliates of Lehman Brothers Inc., which were
prohibited from selling any shares until August 8, 1998. Any other selling
stockholder was permitted to sell up to 16% of its shares in the IPO. Each
selling stockholder acknowledged that, except for shares that could have been
sold under the IPO but were not sold at the election of a 5% stockholder, no 5%
stockholder is permitted by our by-laws to acquire or transfer any shares of our
capital stock for three years following the IPO (or upon termination of the
letter agreement, if earlier) unless as of an earlier date our Board determines
that such acquisition or transfer would not be reasonably likely to have a
material adverse effect on our tax position.
At March 31, 1999, 8,205,778 shares of our common stock were still subject
to the restrictions of the letter agreement. The letter agreement was terminated
for 7,887,436 shares on June 4, 1999 and will terminate for the remaining
318,342 shares on July 28, 1999.
Under the letter agreement, we filed registration statements under the
Securities Act with respect to 19,520,596 shares of Class A common stock held by
the selling stockholders. We are obligated to take action to keep such
registration statements effective, subject to occasional periods of suspension
of effectiveness as necessary, until the first to occur of:
o the date on which all shares of common stock registered under the
registration statements have been sold;
o December 31, 1999; and
o the date on which such registration under the Securities Act is no
longer required to sell such shares without restriction.
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These registration statements, of which this prospectus forms a part, which
register 8,205,778 shares still restricted under the letter agreement and the
966,037 shares that have not been registered is being filed in order to register
the remaining common shares subject to our registration obligation under the
letter agreement.
PLAN OF DISTRIBUTION
We may sell Class A common stock, preferred stock, depositary shares,
junior subordinated debt securities, Guarantees, stock purchase contracts or
stock purchase units. Bank United Capital Trust may sell trust preferred
securities; and the selling stockholders may sell Class A common stock. All of
these securities may be offered in one or more of the following ways from time
to time:
o to underwriters for resale to the public or to investors;
o directly to investors; or
o through agents to the public or to investors.
The applicable prospectus supplements will contain the terms of the
offering of the securities, including the name or names of any underwriters or
agents, the initial public offering price of the securities and the proceeds to
us, Bank United Capital Trust, or the selling stockholders, as the case may be,
from the sale, any underwriting discounts or agency fees and other items
constituting underwriters' or agents' compensation, any discounts or concessions
allowed or reallowed or paid to dealers and any securities exchanges on which
the securities may be listed.
If underwriters are used in the sale, the offered securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
Unless otherwise set forth in a prospectus supplement, the obligations of
the underwriters to purchase any series of securities will be subject to certain
conditions and the underwriters will be obligated to purchase all the securities
of the series, if any are purchased.
Underwriters and agents may be entitled under agreements entered into with
us and/or Bank United Capital Trust and/or the selling stockholders to
indemnification by us and/or Bank United Capital Trust and/or the selling
stockholders against certain civil liabilities, including liabilities under the
Securities Act, or to contribution with respect to payments which the
underwriters or agents may be required to make in respect thereof. Underwriters
and agents may be customers of, engage in transactions with, or perform services
for us and our affiliates in the ordinary course of business.
Each series of offered securities will be a new issue of securities and
will have no established trading market other than the Class A common stock,
which is listed on the Nasdaq, Any Class A common stock sold under a prospectus
supplement will be listed on the Nasdaq, subject to official notice of issuance.
Any underwriters to whom securities are sold by us, by Bank United Capital Trust
or the selling stockholders for public offering and sale may make a market in
the securities, but those underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. The securities may or
may not be listed on a national securities exchange.
We cannot assure you that we, Bank United Capital Trust or the selling
stockholders will offer or sell any securities under this prospectus.
Neither we nor Bank United Capital Trust will receive any proceeds from the
sales of shares of Class A common stock by the selling stockholders. We will,
however, bear certain expenses in connection with the registration of the
securities being offered under this prospectus by Bank United Capital Trust and
the selling stockholders, including all costs incident to the offering and sale
of the securities to the public other than any commissions and discounts of
underwriters, dealers or agents and any transfer taxes.
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The selling stockholders, and any broker-dealer who acts in connection with
the sale of the offered securities may be deemed to be an "underwriter" as
that term is defined in the Securities Act, and any commissions received by them
and profit on any resale of the offered securities as principal may be deemed to
be underwriting discounts and commissions under the Securities Act.
We have not authorized anyone, including any salesman or broker, to give
oral or written information about this offering that is different from the
information included in this prospectus or that is not included in this
prospectus.
LEGAL MATTERS
Wachtell, Lipton, Rosen & Katz, New York, New York will pass upon the
validity of the Class A common stock, the preferred stock, the depositary
shares, the trust preferred securities, the junior subordinated debt securities,
the trust preferred securities guarantee, the stock purchase contracts, the
stock purchase units and certain related matters and certain U.S. federal income
tax matters for us, the selling stockholders and Bank United Capital Trust.
Simpson Thacher & Bartlett, New York, New York will pass upon certain legal
matters relating to the offered securities for the underwriters, as described in
the applicable prospectus supplement.
EXPERTS
The financial statements and the related financial statement schedules
incorporated in this prospectus by reference from Bank United Corp.'s Annual
Report on Form 10-K for the year ended September 30, 1998 have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated by reference in this prospectus, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended December 31, 1998 and March 31, 1999 which are incorporated herein by
reference, Deloitte & Touche have applied limited procedures in accordance with
professional standards for a review of such information. However, as stated in
their report included in Bank United Corp.'s Quarterly Report on Form 10-Q for
the quarters ended December 31, 1998 and March 31, 1999 and incorporated by
reference herein, they did not audit and they do not express an opinion on that
interim financial information. Accordingly, the degree of reliance on their
reports on such information should be restricted in light of the limited nature
of the review procedures applied. Deloitte & Touche are not subject to the
liability provisions of Section 11 of the Securities Act of 1933 for their
reports on the unaudited interim financial information because those reports are
not "reports" or a "part" of the registration statement prepared or
certified by an accountant within the meaning of Sections 7 and 11 of the
Securities Act.
FORWARD-LOOKING INFORMATION
Statements and financial discussion and analysis contained in this
prospectus that are not historical facts are forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements involve a number of risks and
uncertainties. The important factors that could cause actual results to differ
materially from the forward-looking statements include, without limitation:
INTEREST RATES AND ECONOMY
o changes in interest rates and economic conditions;
o changes in the levels of loan prepayments and the resulting effects
on the value of our loan and servicing portfolios and the related
hedging instruments;
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o changes in local economic and business conditions adversely affecting
our borrowers and their ability to repay their loans according to
their terms or impacting the value of the related collateral; and
o changes in local economic and business conditions adversely affecting
our customers other than borrowers and their ability to transact
profitable business with us.
COMPETITION AND PRODUCT AVAILABILITY
o Increased competition for deposits and loans adversely affecting rates
and terms;
o changes in availability of loans originated by other financial
institutions or our ability to purchase such loans on favorable terms;
o changes in availability of single family servicing rights in the
marketplace and our ability to purchase such assets on favorable
terms; and
o various strategic alternatives that we consider from time to time,
including acquisitions of other depository institutions, their assets
or their liabilities on terms favorable to us, and our successful
integration of any such acquisitions.
CHANGE IN OUR ASSET MIX
o Increased credit risk in our assets and increased operating risk
caused by an increase in commercial and consumer loans and a decrease
in single family mortgage loans as a percentage of the total loan
portfolio.
LIQUIDITY AND CAPITAL
o Changes in the availability of funds resulting in increased costs or
reduced liquidity;
o changes in our ability to pay dividends on our common stock; and
o increased asset levels and changes in the composition of assets and
the resulting impact on the Bank's capital levels and regulatory
capital ratios.
SYSTEMS
o Our ability to acquire, operate and maintain cost effective and
efficient systems; and
o our ability to complete our project to assess and resolve any Year
2000 problems on time.
PERSONNEL
o The loss of senior management or operating personnel and the potential
inability to hire qualified personnel at reasonable compensation
levels.
REGULATORY, COMPLIANCE AND LEGAL
o Changes in applicable statutes and government regulations or their
interpretations;
o claims of our noncompliance with statutory and regulatory
requirements;
o claims with respect to representations and warranties made by us to
purchasers and insurers of mortgage loans and to purchasers of
mortgage servicing rights; and
o changes in the status of litigation to which we are a party.
ABOUT THIS PROSPECTUS
This prospectus is part of registration statements that we filed with the
Commission utilizing a "shelf" registration procedure. Under this shelf
procedure, we, the selling stockholders and Bank United Capital Trust may, from
time to time, sell any combination of the securities described in this
prospectus in one or more offerings up to a total offering price of $830
million.
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This prospectus provides you with a general description of the securities
that we, the selling stockholders or Bank United Capital Trust may offer. We
will provide a prospectus supplement that will contain specific information
about the terms of each offering of securities. The prospectus supplement may
also add, update or change information contained in this prospectus. You should
read both this prospectus and any prospectus supplement together with the
additional information described under the heading "Where You Can Find More
Information" below.
You should rely only on the information provided in this prospectus and in
any prospectus supplement, including the information incorporated by reference.
We have not authorized anyone to provide you with different information. You
should not assume that the information in this prospectus, or any supplement to
this prospectus, is accurate at any date other than the date indicated on the
cover page of these documents.
We are not offering the securities in any state where the offer is not
permitted.
WHERE YOU CAN FIND MORE INFORMATION
The rules and regulations of the Commission allow us to omit some of the
information included in the registration statement from this prospectus. The
registration statement, including the attached exhibits and schedules, contains
additional relevant information about us and our securities.
In addition, we file reports, proxy statements and other information with
the Commission under the Securities Exchange Act of 1934. You may read and copy
this information at the following locations of the Commission:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois
60661-2511
You may obtain information on the operation of the Public Reference Room by
calling the Commission at 1-800-SEC-0330. The Commission also maintains an
Internet world wide web site that contains reports, proxy statements and other
information about issuers, like us, who file electronically with the Commission.
The address of that site is http://www.sec.gov.
The Commission allows us to "incorporate by reference" the information we
file with it, which means that we can disclose important information to you by
referring you to the other information we have filed with the Commission. The
information that we incorporate by reference is considered to be part of this
prospectus, and later information that we file with the Commission will
automatically update and supersede the information we've included in this
prospectus. We incorporate by reference the documents listed below:
o Our Annual Report on Form 10-K for the year ended September 30, 1998.
o Our Quarterly Reports on Form 10-Q for the quarters ended December 31,
1998 and March 31, 1999.
o Our Current Reports on Form 8-K filed on March 24, 1999, April 2, 1999
and June 9, 1999, as amended by current report on Form 8-K/A filed on
June 23, 1999.
o The description of our Class A common stock contained in our Form 8-A
dated July 12, 1996.
o Our Proxy Statement for the Annual Meeting of Stockholders dated
February 10, 1999.
We also incorporate by reference any future filings we will make with the
Commission under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after
the date of this prospectus but before the end of the offering of the securities
described in this prospectus.
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You may request a free copy of these filings by writing or calling us at
the following address:
INVESTOR RELATIONS
BANK UNITED CORP.
3200 SOUTHWEST FREEWAY
SUITE 3100
HOUSTON, TX 77027
(713) 543-6926
This prospectus does not contain or incorporate by reference any separate
financial statements of Bank United Capital Trust. We do not believe that these
financial statements are material to prospective holders of the trust preferred
securities because:
o all of the voting securities of Bank United Capital Trust will be
owned, directly or indirectly, by us, and we are a reporting company
under the Exchange Act;
o Bank United Capital Trust has no independent operations but exists for
the sole purpose of issuing securities representing undivided
beneficial ownership interests in its assets and investing these
proceeds in the junior subordinated debt securities issued by us; and
o the obligations of Bank United Capital Trust under the trust preferred
securities are guaranteed by us to the extent described in this
prospectus.
Bank United Capital Trust is not currently subject to the informational
reporting requirements of the Exchange Act. Bank United Capital Trust will
become subject to those requirements upon the effectiveness of the registration
statement of which this prospectus is a part, although we and Bank United
Capital Trust intend to seek and expect to receive exemptions from those
reporting requirements from the Commission.
39
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1,200,000 SHARES
BANK UNITED CORP.
SERIES A PREFERRED STOCK
-------------------------------------------------
PROSPECTUS SUPPLEMENT
August 6, 1999
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LEHMAN BROTHERS
