As filed with the Securities and Exchange Commission
on September 11, 1997
Registration Nos. 333-33955
333-33955-01
===================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
AMENDMENT NO. 1
to
FORM S-4
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
-------------------------
GREENPOINT FINANCIAL CORP. GREENPOINT CAPITAL TRUST I
(Exact name of registrant (Exact name of registrant as
as specified in its charter) specified in its Trust Agreement)
Delaware Delaware
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
6712 6799
(Primary Standard Industrial (Primary Standard Industrial
Classification Code Number) Classification Code Number)
06-1379001 13-7124901
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
GreenPoint Financial Corp. c/o GreenPoint Financial Corp.
90 Park Avenue 90 Park Avenue
New York, New York 10016 New York, New York 10016
(212) 834-1711 (212) 834-1711
(Address, including zip code, (Address, including zip code,
code, and telephone number, code, and telephone number,
including area code, of including area code, of
registrant's principal registrant's principal
executive offices) executive offices)
-------------------------
Howard C. Bluver
Senior Vice President and General Counsel
GreenPoint Financial Corp.
90 Park Avenue
New York, New York 10016
(212) 834-1724
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With a copy to:
Kenneth L. Bachman, Esq.
Cleary, Gottlieb, Steen & Hamilton
1752 N Street, N.W.
Washington, D.C. 20036
(202) 728-2765
Approximate date of commencement of proposed sale to the
public: As promptly as practicable after the effective date of
this Registration Statement.
If the securities being registered on this Form are being
offered in connection with the formation of a holding company and
there is compliance with General Instruction G, please check the
following box.
--------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON
SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE
DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER
AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
===================================================================
<PAGE>
CROSS-REFERENCE SHEET
Pursuant to Item 501(b) of Regulation S-K showing location
in the Prospectus of Information Required by Items
in Form S-4
Item Location in Prospectus
---- ----------------------
1. Forepart of the Registration
Statement and Outside Front
Cover Page of Prospectus ......... Facing Page of the Registration
Statement; Cross Reference
Sheet; Outside Front Cover Page
of Prospectus
2. Inside Front and Outside Back
Cover Pages of Prospectus ........ Available Information; Outside
Back Cover of Prospectus
3. Risk Factors, Ratio of Earnings
to Fixed Charges and Other
Information ...................... Summary; Risk Factors; Ratio
of Earnings to Combined
Fixed Charges and Preferred
Stock Dividends; The Trust;
Selected Financial Data
4. Terms of the Transaction ......... Summary; Risk Factors; The
Exchange Offer; Description
of Capital Securities;
Description of Junior
Subordinated Debentures;
Description of Guarantee;
Relationship Among the
Capital Securities, the Junior
Subordinated Debentures and
the Guarantee; Plan of Distri-
bution; Certain Federal Income
Tax Consequences
5. Pro Forma Financial Information .. Not Applicable
6. Material Contracts with the
Company being Acquired ........... Not Applicable
7. Additional Information required
for Reoffering by Persons and
Parties Deemed to be
Underwriters ..................... Not Applicable
8. Interests of Named Experts
and Counsel ...................... Not Applicable
9. Disclosure of Commission
Position on Indemnification
for Securities Act
Liabilities.... .................. Not Applicable
10. Information with Respect
to S-3 Registrants ............... Not Applicable
11. Incorporation of Certain
Information by Reference ......... Available Information; Incorpor-
ation of Certain Information
by Reference
12. Information with Respect
to S-2 or S-3 Registrants ........ Not Applicable
13. Incorporation of Certain
Information by Reference ......... Not Applicable
14. Information with Respect to
Registrants Other than S-3
or S-2 Registrants ............... Not Applicable
15. Information with Respect to
S-3 Companies .................... Not Applicable
16. Information with Respect to
S-2 or S-3 Companies ............. Not Applicable
17. Information with Respect to
Companies Other Than S-3 or
S-2 Companies .................... Not Applicable
18. Information if Proxies,
Consents or Authorizations
Are To Be Solicited .............. Not Applicable
19. Information if Proxies,
Consents or Authorizations
Are Not To Be Solicited or
in an Exchange Offer ............. Description of Junior Subordi-
nated Debentures; Description
of Guarantee; Relationship Among
the Capital Securities, the
Junior Subordinated Debentures
and the Guarantee; Summary; The
Exchange Offer; Description of
Capital Securities
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor
may offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of any offer to buy nor shall there be any sale of these
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such State.
SUBJECT TO COMPLETION, DATED SEPTEMBER , 1997
PROSPECTUS
- ----------
$200,000,000
GREENPOINT CAPITAL TRUST I
Offer to exchange its 9.10% Subordinated Capital Income
Securities which have been registered under the Securities
Act of 1933 for any and all of its outstanding
9.10% Subordinated Capital Income Securities
(Liquidation Amount $1,000 per Capital Security)
Fully and Unconditionally Guaranteed to the
extent set forth herein by
GREENPOINT FINANCIAL CORP.
The Exchange Offer and Withdrawal Rights will expire
at 5:00 p.m., New York City time, on October 13, 1997,
unless extended
--------------------
GreenPoint Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"),
hereby offers, upon the terms and subject to the conditions set
forth in this Prospectus (as the same may be amended or
supplemented from time to time, the "Prospectus") and in the
accompanying Letter of Transmittal (which together constitute the
"Exchange Offer"), to exchange up to $200,000,000 aggregate
liquidation amount of its 9.10% Subordinated Capital Income
Securities, liquidation amount $1,000 per Capital Security (the
"New Capital Securities"), which have been registered under the
Securities Act of 1933, as amended (the "Securities Act"),
pursuant to a Registration Statement (as defined herein) of which
this Prospectus constitutes a part, for a like liquidation amount
of its outstanding 9.10% Subordinated Capital Income Securities,
liquidation amount $1,000 per Capital Security (the "Old Capital
Securities"), of which $200,000,000 aggregate liquidation amount
is outstanding. Pursuant to the Exchange Offer, GreenPoint
Financial Corp., a Delaware corporation (the "Company"), is also
exchanging (i) its guarantee with respect to the payment of
distributions and other payments on liquidation or redemption of
the Old Capital Securities (the "Old Guarantee") for a like
guarantee of the New Capital Securities (the "New Guarantee"),
and (ii) all of its outstanding 9.10% Junior Subordinated
Debentures due 2027 (the "Old Junior Subordinated Debentures"),
of which $206,185,567 aggregate principal amount is outstanding,
for a like aggregate principal amount of its 9.10% Junior
Subordinated Debentures due 2027 (the "New Junior Subordinated
Debentures"), which New Guarantee and New Junior Subordinated
Debentures also have been registered under the Securities Act.
The Old Capital Securities, the Old Guarantee and the Old Junior
Subordinated Debentures are collectively referred to herein as
the "Old Securities" and the New Capital Securities, the New
Guarantee and the New Junior Subordinated Debentures are
collectively referred to herein as the "New Securities."
--------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 16 OF THIS PROSPECTUS
FOR CERTAIN INFORMATION RELEVANT TO AN INVESTMENT IN THE NEW
SECURITIES.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is September , 1997
<PAGE>
(continued from cover page)
The terms of the New Securities are identical in all material
respects to the respective terms of the Old Securities, except
that (i) the New Securities have been registered under the
Securities Act and therefore will not be subject to certain
restrictions on transfer applicable to the Old Securities, (ii)
the New Capital Securities will not provide for any increase in
the distribution rate thereon, and (iii) the New Junior
Subordinated Debentures will not provide for any increase in the
interest rate thereon. See "Description of Capital Securities."
The New Capital Securities are being offered for exchange in
order to satisfy certain obligations of the Company and the Trust
under the Registration Rights Agreement, dated June 3, 1997 (the
"Registration Rights Agreement"), among the Company, the Trust
and Lehman Brothers Inc., as representative of the Initial
Purchasers (as defined herein) of the Old Capital Securities.
In the event that the Exchange Offer is consummated, any Old
Capital Securities which remain outstanding after consummation of
the Exchange Offer will vote together with the New Capital
Securities issued in the Exchange Offer as a single class for
purposes of determining whether holders of the requisite
percentage in outstanding liquidation amount thereof have taken
certain actions or exercised certain rights under the Declaration
(as defined herein).
The Old Capital Securities and the New Capital Securities are
collectively referred to herein as the "Capital Securities." The
Old Capital Securities represent, and the New Capital Securities
when issued will represent, undivided beneficial interests in the
assets of the Trust. The Company owns all of the common
securities of the Trust (the "Common Securities") representing
undivided beneficial interests in the assets of the Trust. The
Trust exists for the sole purpose of issuing the Common
Securities and the Capital Securities (together, the "Trust
Securities") and investing the proceeds thereof in the Junior
Subordinated Debentures (as defined herein) and certain other
limited activities described herein.
The Old Junior Subordinated Debentures and the New Junior
Subordinated Debentures are collectively referred to herein as
the "Junior Subordinated Debentures" and the Old Guarantee and
the New Guarantee are collectively referred to herein as the
"Guarantee."
Holders of the Capital Securities are or will be, as the case
may be, entitled to receive cumulative cash distributions
accruing from June 3, 1997, the date of original issuance of the
Old Capital Securities, and payable semi-annually in arrears on
the 1st day of December and June of each year, commencing
December 1, 1997, at the annual rate of 9.10% of the liquidation
amount of $1,000 per Capital Security ("Distributions"). The
distribution rate and the distribution payment dates and other
payment dates for the Capital Securities will correspond to the
interest rate and interest payment dates and other payment dates
on the Junior Subordinated Debentures, which will be the sole
assets of the Trust. The Company will guarantee the payment of
Distributions and payments on liquidation of the Trust or
redemption of the Capital Securities, but only in each case to
the extent of funds held by the Trust, as described herein (the
"Guarantee"). See "Description of Guarantee." If the Company does
not make interest payments on the Junior Subordinated Debentures
held by the Trust, the Trust will have insufficient funds to pay
Distributions on the Capital Securities. The Company's
obligations under the Guarantee, taken together with its
obligations under the Junior Subordinated Debentures and the
Indenture (as defined herein), including its obligation to pay
all costs, expenses and liabilities of the Trust (other than with
respect to the Capital Securities), constitute a full and
unconditional guarantee of all of the Trust's obligations under
the Capital Securities. The obligations of the Company under the
Guarantee and the Junior Subordinated Debentures are subordinate
and junior in right of payment to all Indebtedness (as defined in
"Description of Junior Subordinated Debentures -- Subordination")
of the Company and will be structurally subordinated to all
liabilities and obligations of the Company's subsidiaries. As of
June 30, 1997, the Company had approximately $236 million aggregate
principal amount of Indebtedness
2
<PAGE>
outstanding, and the Company's subsidiaries had approxi-
mately $507 million of indebtedness and other liabilities. The
terms of the Junior Subordinated Debentures place no limitation
on the amount of Indebtedness that may be incurred by the Company
or on the amount of liabilities and obligations of the Company's
subsidiaries. See "Description of Junior Subordinated Debentures
- -- Subordination."
The Company has the right to defer payment of interest on the
Junior Subordinated Debentures at any time or from time to time
for a period not exceeding 10 consecutive semi-annual periods
with respect to each deferral period (each, an "Extension
Period"), provided that no Extension Period may extend beyond the
Stated Maturity (as defined herein) of the Junior Subordinated
Debentures. Upon the termination of any such Extension Period and
the payment of all amounts then due on any Interest Payment Date
(as defined herein), the Company may elect to begin a new
Extension Period subject to the requirements set forth herein.
Accordingly, there could be multiple Extension Periods of varying
lengths throughout the term of the Junior Subordinated
Debentures. If interest payments on the Junior Subordinated
Debentures are so deferred, distributions on the Capital
Securities will also be deferred and the Company may not, and may
not permit any subsidiary of the Company to, (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, the Company's
capital stock or (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt
securities that rank pari passu with or junior to the Junior
Subordinated Debentures or make any guarantee payments with
respect to any guarantee by the Company of the debt securities of
any subsidiary of the Company if such guarantee ranks pari passu
with or junior to the Junior Subordinated Debentures (other than
(a) repurchases, redemptions or other acquisitions of shares of
capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or
consultants, or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange
or conversion of any class or series of the Company's capital
stock (or any capital stock of a subsidiary of the Company) for
any class or series of the Company's capital stock or of any
class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of
fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any stockholder's
rights plans, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on
which the dividend is being paid (or ranks pari passu with or
junior to such stock). During an Extension Period, interest on
the Junior Subordinated Debentures will continue to accrue (and
the amount of Distributions to which holders of the Capital
Securities are entitled will accumulate) at the rate of 9.10% per
annum, compounded semi-annually to the extent permitted by
applicable law, and holders of the Capital Securities will be
required to accrue interest income for United States federal
income tax purposes prior to the receipt of cash related to such
interest income. See "Description of Junior Subordinated
Debentures -- Option to Extend Interest Payment Period" and
"Certain United States Federal Income Tax Consequences --
Interest Income and Original Issue Discount."
The Junior Subordinated Debentures are not redeemable prior
to June 1, 2007 unless a Special Event (as defined herein) has
occurred. The Junior Subordinated Debentures are redeemable prior
to maturity at the option of the Company, subject to the receipt
of any necessary prior regulatory approval (i) on or after June
1, 2007, in whole or in part, at a redemption price equal to
104.4790% of the principal amount thereof on June 1, 2007,
declining ratably on each June 1 thereafter to 100% on or after
June 1, 2017, plus the accrued and unpaid interest thereon, or
(ii) at any time, in whole (but not in part), upon the
3
<PAGE>
occurrence and continuation of a Special Event, at a
redemption price equal to the greater of (a) 100% of the
principal amount thereof or (b) as determined by a Quotation
Agent (as hereinafter defined), the sum of the present values of
the principal amount and premium payable with respect to an
optional redemption of such Junior Subordinated Debentures on
June 1, 2007, together with scheduled payments of interest from
the prepayment date to June 1, 2007, discounted to the prepayment
date on a semi-annual basis (assuming a 360-day year consisting
of twelve 30-day months) at the Adjusted Treasury Rate (as
defined herein) plus, in either case, accrued interest thereon to
the date of prepayment, in each case subject to the further
conditions described under "Description of Junior Subordinated
Debentures --Redemption." The Capital Securities are subject to
mandatory redemption, in whole or in part, upon repayment of the
Junior Subordinated Debentures at maturity or their earlier
redemption, in an amount equal to the amount of related Junior
Subordinated Debentures maturing or being redeemed and at a
redemption price equal to the redemption price of such Junior
Subordinated Debentures, in each case plus accumulated and unpaid
Distributions thereon to the date of redemption.
The Company will have the right, at any time, subject to the
receipt of any necessary prior regulatory approval, to dissolve
the Trust and, after satisfaction of the claims of creditors of
the Trust, if any, as provided by applicable law, cause the
Junior Subordinated Debentures to be distributed to the holders
of the Capital Securities and the Common Securities in
liquidation of the Trust. See "Description of Capital Securities
- -- Redemption -- Special Event Redemption or Distribution of
Junior Subordinated Debentures."
In the event of the liquidation of the Trust, after
satisfaction of the claims of creditors of the Trust, if any, as
provided by applicable law, the holders of the Capital Securities
will be entitled to receive a liquidation amount of $1,000 per
Capital Security plus accumulated and unpaid Distributions
thereon to the date of payment, which may be in the form of a
distribution of such amount in Junior Subordinated Debentures as
described above. If such liquidation amount can be paid only in
part because the Trust has insufficient assets available to pay
in full the aggregate liquidation amount, then the amounts
payable directly by the Trust on the Capital Securities shall be
paid on a pro rata basis. The holder(s) of the Common Securities
will be entitled to receive distributions upon any such
liquidation pro rata with the holders of the Capital Securities,
except that if an Indenture Event of Default (as defined herein)
has occurred and is continuing, the Capital Securities will have
a priority over the Common Securities. See "Description of
Capital Securities -- Liquidation Distribution Upon Dissolution."
Based on interpretations by the staff of the Securities and
Exchange Commission (the "Commission"), as set forth in no-action
letters issued to third parties, the Company and the Trust
believe that the New Securities issued pursuant to the Exchange
Offer may be offered for resale, resold or otherwise transferred
by holders thereof (other than any holder that is an "affiliate"
of the Company or the Trust as defined in Rule 405 under the
Securities Act) without compliance with the registration and
prospectus delivery provisions of the Securities Act; provided
that such New Securities are acquired in the ordinary course of
such holders' business and such holders are not engaged in, and
do not intend to engage in, a distribution of such New Securities
and have no arrangement or understanding with any person to
participate in the distribution of such New Securities. However,
the staff of the Commission has not considered the Exchange Offer
in the context of a no-action letter, and there can be no
assurance that the staff of the Commission would make a similar
determination with respect to the Exchange Offer as in such other
circumstances. By tendering the Old Capital Securities in
exchange for New Capital Securities, each holder, other than a
broker-dealer, will represent to the Company and the Trust that:
(i) it is not an affiliate of the Company or the Trust (as
defined in Rule 405 under the Securities Act); (ii) any New
Capital Securities to be received by it are being acquired in the
course of its ordinary business; and (iii) it is not engaged in,
and does not intend to engage in, a distribution of the New Capital
4
<PAGE>
Securities and has no arrangement or understanding with any
person to participate in a distribution (within the meaning of
the Securities Act) of the New Capital Securities.
Each broker-dealer that receives New Capital Securities for
its own account pursuant to the Exchange Offer must acknowledge
that it will deliver a prospectus in connection with any resale
of such New Capital Securities. The Letter of Transmittal states
that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. This
Prospectus, as it may be amended or supplemented from time to
time, may be used by a broker-dealer in connection with resales
of New Capital Securities received in exchange for Old Capital
Securities where such Old Capital Securities were acquired by
such broker-dealer as a result of market-making activities or
other trading activities. The Company and the Trust have agreed
that, starting on the date on which the Exchange Offer is
consummated and ending on the close of business one year after
such date, they will make this Prospectus available to any
broker-dealer for use in connection with any such resale. See
"Plan of Distribution."
In that regard, each Exchanging Dealer (as defined herein)
who surrenders Old Capital Securities pursuant to the Exchange
Offer will be deemed to have agreed, by execution of the Letter
of Transmittal or by delivery of an Agent's Message (as defined
herein), that, upon receipt of notice from the Company or the
Trust of the occurrence of any event or the discovery of any fact
which makes any statement contained or incorporated by reference
in this Prospectus untrue in any material respect or which causes
this Prospectus to omit to state a material fact necessary in
order to make the statements contained or incorporated by
reference herein, in the light of the circumstances under which
they were made, not misleading, or of the occurrence of certain
other events specified in the Registration Rights Agreement, such
Exchanging Dealer will suspend the sale of New Securities
pursuant to this Prospectus until the Company or the Trust has
amended or supplemented this Prospectus to correct such
misstatement or omission and has furnished copies of the amended
or supplemented Prospectus to such Exchanging Dealer, or the
Company or the Trust has given notice that the sale of the New
Securities may be resumed, as the case may be.
Prior to the Exchange Offer, there has been only a limited
secondary market and no public market for the Old Capital
Securities. The New Capital Securities will be a new issue of
securities for which there currently is no market. The New
Capital Securities will not be listed on a securities exchange
and there can be no assurance as to the development or liquidity
of any market for the New Capital Securities.
Any Old Capital Securities not tendered and accepted in the
Exchange Offer will remain outstanding and will be entitled to
all the same rights and will be subject to the same limitations
applicable thereto under the Declaration (except for those rights
which terminate upon consummation of the Exchange Offer).
Following consummation of the Exchange Offer, the holders of Old
Capital Securities will continue to be subject to all of the
existing restrictions upon transfer thereof and neither the
Company nor the Trust will have any further obligation to such
holders (other than under certain limited circumstances) to
provide for registration under the Securities Act of the Old
Capital Securities held by them. To the extent that Old Capital
Securities are tendered and accepted in the Exchange Offer, a
holder's ability to sell untendered Old Capital Securities could
be adversely affected. See "Risk Factors -- Consequences of a
Failure to Exchange Old Capital Securities."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION. HOLDERS OF OLD CAPITAL SECURITIES ARE URGED TO
READ THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY
5
<PAGE>
BEFORE DECIDING WHETHER TO TENDER THEIR OLD CAPITAL SECURITIES PURSUANT
TO THE EXCHANGE OFFER.
Old Capital Securities may be tendered for exchange on or
prior to 5:00 p.m., New York City time, on October 13, 1997 (such
time on such date being hereinafter called the "Expiration
Date"), unless the Exchange Offer is extended by the Company and
the Trust (in which case the term "Expiration Date" shall mean
the latest date and time to which the Exchange Offer is
extended). Tenders of Old Capital Securities may be withdrawn at
any time on or prior to the Expiration Date. The Exchange Offer
is not conditioned upon any minimum liquidation amount of Old
Capital Securities being tendered for exchange. However, the
Exchange Offer is subject to certain events and conditions which
may be waived by the Company or the Trust and to the terms and
provisions of the Registration Rights Agreement. Old Capital
Securities may be tendered in whole or in part. The Company has
agreed to pay all expenses of the Exchange Offer, except as
otherwise specified herein. See "The Exchange Offer --Fees and
Expenses." The New Capital Securities will pay cumulative
distributions from the most recent Distribution Payment Date (as
defined herein) on the Old Capital Securities surrendered in
exchange for such New Capital Securities or, if no distributions
have been paid on such Old Capital Securities, from June 3, 1997.
Holders of the Old Capital Securities whose Old Capital
Securities are accepted for exchange will not receive accumulated
distributions on such Old Capital Securities for any period from
and after the last Distribution Payment Date on such Old Capital
Securities prior to the original issue date of the New Capital
Securities or, if no such distributions have been paid, will not
receive any accumulated distributions on such Old Capital
Securities, and will be deemed to have waived the right to
receive any distributions on such Old Capital Securities
accumulated from and after such Distribution Payment Date or, if
no such distributions have been paid or duly provided for, from
and after June 3, 1997. This Prospectus, together with the Letter
of Transmittal, is being sent to all registered holders of Old
Capital Securities as of September 12, 1997.
Neither the Company nor the Trust will receive any cash
proceeds from the issuance of the New Capital Securities offered
hereby. No dealer-manager is being used in connection with the
Exchange Offer. See "Use of Proceeds" and "Plan of Distribution."
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY
OR THE TRUST ACCEPT SURRENDERS FOR EXCHANGE FROM, HOLDERS OF OLD
CAPITAL SECURITIES IN ANY JURISDICTION IN WHICH THE EXCHANGE
OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH
THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION.
EACH EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT
ACCOUNT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (EACH, A "PLAN"), ANY ENTITY
WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY
PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET ENTITY"), AND EACH
PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD
THE CAPITAL SECURITIES OR ANY INTEREST THEREIN, IF SUCH PURCHASE
OR HOLDING IS ELIGIBLE FOR THE EXEMPTIVE RELIEF PROVIDED BY U.S.
DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION
("PTCE") 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE
EXEMPTION WITH RESPECT TO SUCH PURCHASE OR HOLDING, ANY PURCHASER
OR HOLDER OF THE CAPITAL SECURITIES OR ANY INTEREST THEREIN WILL
BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF
THAT EITHER (A) THE PURCHASER AND HOLDER IS NOT A PLAN OR A PLAN
6
<PAGE>
ASSET ENTITY AND IS NOT PURCHASING SUCH SECURITIES ON
BEHALF OF OR WITH "PLAN ASSETS" OF ANY PLAN OR (B) THE PURCHASE
AND HOLDING OF THE CAPITAL SECURITIES IS ELIGIBLE FOR THE
EXEMPTIVE RELIEF PROVIDED BY PTCE 96-23, 95-60, 91- 38, 90-1 OR
84-14 OR ANOTHER APPLICABLE EXEMPTION WITH RESPECT TO SUCH
PURCHASE OR HOLDING. SEE "TRANSFER RESTRICTIONS" AND "ERISA
CONSIDERATIONS."
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files reports and other
information with the Securities and Exchange Commission (the
"Commission"). Reports, proxy statements and other information
filed by the Company with the Commission pursuant to the
informational requirements of the Exchange Act may be inspected
and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Judiciary Plaza,
Washington, D.C. 20549, and at the following Regional Offices of
the Commission: Chicago Regional Office, Suite 1400, Citicorp
Center, 14th Floor, 500 West Madison Street, Chicago, Illinois
60661; and New York Regional Office, 7 World Trade Center, 13th
Floor, Suite 1300, New York, New York 10048. Copies of such
material can be obtained at prescribed rates from the Public
Reference Section of the Commission at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549. The Commission also
maintains a Web site (http://www.sec.gov) that contains reports,
proxy statements and other information regarding the Company. In
addition, such reports, proxy statements and other information
can be inspected at The New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005, on which the common stock of
the Company is listed.
This Prospectus constitutes a part of a registration
statement on Form S-4 (the "Registration Statement") filed by the
Company and the Trust with the Commission under the Securities
Act. This Prospectus does not contain all the information set
forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the
Commission, and reference is hereby made to the Registration
Statement and to the exhibits relating thereto for further
information with respect to the Company, the Trust and the New
Securities. Any statements contained herein concerning the
provisions of any document are not necessarily complete and, in
each instance, reference is made to the copy of such document
filed as an exhibit to the Registration Statement or otherwise
filed with the Commission. Each such statement is qualified in
its entirety by such reference.
No separate financial statements of the Trust have been
included or incorporated by reference herein. The Company does
not believe such financial statements would be material to
holders of the Capital Securities because (i) all of the Common
Securities of the Trust will be owned, directly or indirectly, by
the Company, a reporting company under the Exchange Act, (ii) the
Trust is a newly formed special purpose entity, has no operating
history or independent operations but exists for the sole purpose
of issuing securities representing undivided beneficial interests
in its assets and investing the proceeds thereof in Junior
Subordinated Debentures issued by the Company, and (iii) the
obligations of the Trust under the Capital Securities are
guaranteed by the Company to the extent described herein. See
"Relationship Among the Capital Securities, the Junior
Subordinated Debentures and the Guarantee."
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996 and the Company's Quarterly Reports
on Form 10-Q for the quarters ended March 31, 1997 and June 30,
7
<PAGE>
1997, previously filed by the Company with the Commission, are
incorporated by reference in this Prospectus and shall be deemed
to be a part hereof.
Each document filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of this Prospectus and prior to the
termination of any offering of securities made by this Prospectus
shall be deemed to be incorporated herein by reference and to be
a part hereof from the date of filing such document. Any
statement contained herein, or in a document all or a portion of
which is incorporated or deemed to be incorporated by reference
herein, shall be deemed to be modified or superseded for purposes
of the Registration Statement and this Prospectus to the extent
that a statement contained herein or in any other subsequently
filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of the
Registration Statement or this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH
ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THE COMPANY WILL
PROVIDE WITHOUT CHARGE TO ANY PERSON TO WHOM A COPY OF THIS
PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST, A COPY OF
ANY AND ALL OF THE DOCUMENTS THAT HAVE BEEN OR MAY BE
INCORPORATED BY REFERENCE HEREIN (OTHER THAN EXHIBITS TO SUCH
DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED BY REFERENCE
INTO SUCH DOCUMENTS). THESE DOCUMENTS ARE AVAILABLE UPON REQUEST
FROM GREENPOINT FINANCIAL CORP., ATTN. CHIEF FINANCIAL OFFICER,
90 PARK AVENUE, NEW YORK, NEW YORK 10016, TELEPHONE (212)
834-1711. IN ORDER TO ENSURE TIMELY DELIVERY OF THE DOCUMENTS,
ANY REQUEST SHOULD BE MADE BY OCTOBER 6, 1997, FIVE BUSINESS DAYS
PRIOR TO THE EXPIRATION DATE.
8
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SUMMARY
This summary is qualified by the more detailed information
and financial statements appearing elsewhere, or incorporated by
reference, in this Prospectus. Prospective investors are urged to
read this Prospectus in its entirety.
The Company
The Company is a bank holding company organized under the
laws of the state of Delaware and registered under the Bank
Holding Company Act of 1956. The Company provides a variety of
financial services, primarily through its bank subsidiary,
GreenPoint Bank, a New York State chartered savings bank (the
"Bank") and the Bank's wholly owned subsidiary, GreenPoint
Mortgage Corp. ("GPMC"), a national home mortgage lender
headquartered in Charlotte, North Carolina.
The Bank is supervised and examined by the New York State
Superintendent of Banks and the Federal Deposit Insurance
Corporation. The Bank operates 74 full-service branches in the
greater metropolitan New York City area. The Bank attracts retail
deposits from the public and invests those deposits, together
with funds generated from operations, in mortgage loans and
marketable securities. Its revenues are derived principally from
interest on its loan portfolio and investment securities.
Through the Bank and GPMC, the Company is primarily engaged
in mortgage lending in New York and across the nation. The
Company originates both adjustable-rate mortgage and fixed-rate
loans, primarily through a network of mortgage brokers, mortgage
bankers, attorneys and other real estate professionals and to a
lesser extent, from customers and members of the local
communities in the Company's lending area. The Company
specializes in a limited documentation mortgage loan product ("No
Doc" and "Low Doc" loans) which serves a particular niche of
borrowers willing to pay a premium, in the form of higher
interest rates and loan fees, and provide larger down payments in
exchange for more expedient loan processing by virtue of
providing less income and asset information as compared to loans
underwritten in conformance with Federal National Mortgage
Association ("FNMA") standards. In 1996, the Company's No Doc
lending program accounted for 93.4% of loan originations. As
compared to other lending institutions which rely more heavily
upon a borrower's income and demonstrated ability to repay the
loan, the Company may be more susceptible to increases in loan
delinquencies in periods of economic recession and to loan losses
in periods of declining real estate market values. As a result of
the Low Doc/No Doc lending strategy, the Company has
traditionally achieved higher interest margins and levels of net
interest income than those generated by lenders that concentrate
on FNMA conforming loans. This, in turn, has resulted in a
relatively high level of profitability despite traditionally
higher levels of loan delinquencies. During 1996, the Company
expanded its lending program to new markets in northern New
Jersey, Chicago, Boston, Philadelphia, Washington, D.C. and
Miami. Although the Company believes that it has implemented
appropriate underwriting and credit quality controls in these new
markets, there can of course be no assurance that the Company's
experience in these areas will be as favorable as it has been in
New York.
The Company maintains its principal executive offices at 90
Park Avenue, New York, New York 10016, telephone (212) 834-1711.
The Exchange Offer......
The Exchange Offer...... Up to $200,000,000 aggregate liquidation
amount of New Capital Securities are being
offered in exchange for a like aggregate
9
<PAGE>
liquidation amount of Old Capital
Securities. Old Capital Securities may
be tendered for exchange, in whole or in
part. The Company and the Trust are
making the Exchange Offer in order to
satisfy their obligations under the
Registration Rights Agreement relating
to the Old Capital Securities. For a
description of the procedures for
tendering Old Capital Securities, see
"The Exchange Offer -- Procedures for
Tendering Old Capital Securities."
Expiration Date......... The Expiration Date of the Exchange Offer
will be 5:00 p.m., New York City time, on
October 13, 1997, unless the Exchange
Offer is extended by the Company and the
Trust. See "The Exchange Offer -- Expira-
tion Date; Extensions; Amendments."
Conditions to
the Exchange
Offer................... The Exchange Offer is subject to certain
conditions, which may be waived by the
Company and the Trust in their sole
discretion. The Exchange Offer is not
conditioned upon any minimum liquidation
amount of Old Capital Securities being
tendered. See "The Exchange Offer -- Condi-
tions to the Exchange Offer."
The Company and the Trust reserve the
right in their sole discretion, subject
to applicable law, at any time and from
time to time, (i) to delay the
acceptance of the Old Capital Securities
for exchange, (ii) to terminate the
Exchange Offer if certain specified
events have occurred, (iii) to extend
the Expiration Date of the Exchange
Offer and retain all Old Capital
Securities tendered pursuant to the
Exchange Offer, subject, however, to the
right of holders of Old Capital
Securities to withdraw their tendered
Old Capital Securities, or (iv) to waive
any condition or otherwise amend the
terms of the Exchange Offer in any
respect. See "The Exchange Offer --
Expiration Date; Extensions;
Amendments."
Withdrawal Rights....... Tenders of Old Capital Securities
may be withdrawn at any time
on or prior to the Expiration Date by
delivering a written notice of such
withdrawal to The Bank of New York, as
Exchange Agent (the "Exchange Agent"),
in conformity with certain procedures
set forth below under "The Exchange
Offer --Withdrawal Rights."
Procedures for
Tendering Old
Capital Securities...... Tendering holders of Old Capital
Securities must complete and
sign a Letter of Transmittal in
accordance with the instructions
contained therein and forward the same
by mail, facsimile or hand delivery,
together with any other required
documents, to the Exchange Agent, either
with the Old Capital Securities to be
tendered or in compliance with the
specified procedures for guaranteed
delivery of Old Capital Securities.
Certain brokers,
10
<PAGE>
dealers, commercial banks, trust
companies and other nominees may
also effect tenders by book-entry
transfer, including an Agent's Message
in lieu of the Letter of Transmittal.
Holders of Old Capital Securities
registered in the name of a broker,
dealer, commercial bank, trust company
or other nominee are urged to contact
such person promptly if they wish to
tender Old Capital Securities pursuant
to the Exchange Offer. See "The Exchange
Offer -- Procedures for Tendering Old
Capital Securities."
Letters of Transmittal and certificates
representing Old Capital Securities should
not be sent to the Company or the Trust. Such
documents should only be sent to the Exchange
Agent. Questions regarding how to tender and
requests for information should be directed
to the Exchange Agent. See "The Exchange
Offer -- Exchange Agent."
Resales of New
Capital Securities..... Based on interpretations by the staff of the
Commission as set forth in no-action letters
issued to third parties, the Company and the
Trust believe that the New Securities issued
pursuant to the Exchange Offer may be offered
for resale, resold or otherwise transferred
by holders thereof (other than any holder
that is an "affiliate" of the Company or the
Trust as defined in Rule 405 under the
Securities Act) without compliance with the
registration and prospectus delivery
provisions of the Securities Act; provided
that such New Securities are acquired in the
ordinary course of such holders' business and
such holders are not engaged in, and do not
intend to engage in, a distribution of such
New Securities and have no arrangement or
understanding with any person to participate
in the distribution of such New Securities.
However, the staff of the Commission has not
considered the Exchange Offer in the context
of a no-action letter, and there can be no
assurance that the staff of the Commission
would make a similar determination with
respect to the Exchange Offer as in such
other circumstances. By tendering the Old
Capital Securities in exchange for New
Capital Securities, each holder, other than a
broker-dealer, will represent to the Company
and the Trust that: (i) it is not an
affiliate of the Company or the Trust (as
defined in Rule 405 under the Securities
Act); (ii) any New Capital Securities to be
received by it are being acquired in the
course of its ordinary business; and (iii) it
is not engaged in, and does not intend to
engage in, a distribution of the New Capital
Securities and has no arrangement or
understanding with any person to participate
in a distribution (within the meaning of the
Securities Act) of the New Capital
Securities.
Each broker-dealer that receives New Capital
Securities for its own account pursuant to
the Exchange Offer must acknowledge
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<PAGE>
that it will deliver a prospectus in
connection with any resale of such New
Capital Securities. The Letter of Transmittal
states that by so acknowledging and by
delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an
"underwriter" within the meaning of the
Securities Act. This Prospectus, as it may be
amended or supplemented from time to time,
may be used by a broker-dealer in connection
with resales of New Capital Securities
received in exchange for Old Capital
Securities where such Old Capital Securities
were acquired by such broker-dealer as a
result of market-making activities or other
trading activities. The Company and the Trust
have agreed that, starting on the date on
which the Exchange Offer is consummated and
ending on the close of business one year
after such date, they will make this
Prospectus available to any broker-dealer for
use in connection with any such resale. See
"Plan of Distribution."
In that regard, each Exchanging Dealer
who surrenders Old Capital Securities
pursuant to the Exchange Offer will be
deemed to have agreed, by execution of
the Letter of Transmittal or delivery of
an Agent's Message, that, upon receipt
of notice from the Company or the Trust
of the occurrence of any event or the
discovery of any fact which makes any
statement contained or incorporated by
reference in this Prospectus untrue in
any material respect or which causes
this Prospectus to omit to state a
material fact necessary in order to make
the statements contained or incorporated
by reference herein, in the light of the
circumstances under which they were
made, not misleading, or of the
occurrence of certain other events
specified in the Registration Rights
Agreement, such Exchanging Dealer will
suspend the sale of New Securities
pursuant to this Prospectus until the
Company or the Trust has amended or
supplemented this Prospectus to correct
such misstatement or omission and has
furnished copies of the amended or
supplemented Prospectus to such
Exchanging Dealer, or the Company or the
Trust has given notice that the sale of
the New Securities may be resumed, as
the case may be.
Exchange Agent.......... The Exchange Agent is The Bank of New York.
The address and telephone and facsimile
numbers of the Exchange Agent are set
forth under "The Exchange Offer -- Ex-
change Agent" and in the Letter of Transmittal.
Use of Proceeds......... Neither the Company nor the Trust
will receive any cash proceeds from
the issuance of the New Capital
Securities offered hereby. The
Old Capital Securities surrendered in
exchange for the New Capital Securities
will be retired and canceled. See "Use
of Proceeds."
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<PAGE>
Certain Federal
Income Tax
Consequences:
ERISA Considerations... Holders of Old Capital Securities should
carefully review the information set
forth under "Certain United States
Federal Income Tax Consequences" and
"ERISA Considerations" prior to
tendering Old Capital Securities in the
Exchange Offer.
The Capital Securities..
The Exchange Offer applies to the Old Securities. The terms
of the New Securities are identical in all material respects to
the respective terms of the Old Securities, except that (i) the
New Securities have been registered under the Securities Act and
therefore will not be subject to certain restrictions on transfer
applicable to the Old Securities, (ii) the New Capital Securities
will not provide for any increase in the distribution rate
thereon, and (iii) the New Junior Subordinated Debentures will
not provide for any increase in the interest rate thereon. In the
event that the Exchange Offer is consummated, any Old Capital
Securities which remain outstanding after consummation of the
Exchange Offer will vote together with the New Capital Securities
issued in the Exchange Offer as a single class for purposes of
determining whether holders of the requisite percentage in
outstanding liquidation amount thereof have taken certain actions
or exercised certain rights under the Declaration.
Securities Offered...... 9.10% New Capital Securities
evidencing undivided beneficial
ownership interests in the assets
of the Trust. The Holder thereof
will be entitled to a preference in
certain circumstances with respect to
Distributions and amounts payable on
redemption, liquidation or otherwise
over the Common Securities.
Distributions.......... Holders of the Capital Securities are
entitled to receive cumulative cash
distributions at an annual rate of 9.10% of
the liquidation amount of $1,000 per Capital
Security, accruing from June 3, 1997, the
date of original issuance of the Old Capital
Securities, and payable semi-annually in
arrears on the 1st day of June and December
of each year commencing on December 1, 1997.
The distribution rate and the distribution
and other payment dates for the Capital
Securities correspond to the interest rate
and interest and other payment dates on the
Junior Subordinated Debentures. See
"Description of Capital Securities."
Junior Subordinated
Debentures............ The Trust has invested the proceeds from the
issuance of the Old Capital Securities and
Common Securities in an equivalent amount of
Old Junior Subordinated Debentures of the
Company, which such amount of Old Junior
Subordinated Debentures will be exchanged for
New Junior Subordinated Debentures in the
Exchange Offer. The Junior Subordinated
Debentures will mature on June 1, 2027. The
Junior Subordinated Debentures rank
subordinate and junior in right of payment to
all Indebtedness of the Company. In addition,
the Company's obligations under the Junior
Subordinated Debentures are structurally
subordinated to all existing and future
liabilities and
13
<PAGE>
obligations of its subsidiaries. See
"Risk Factors -- Ranking of Subordinate
Obligations Under the Guarantee and the
Junior Subordinated Debentures", "Risk
Factors -- Status of Company as Holding
Company" and "Description of Junior
Subordinated Debentures --
Subordination."
Guarantee.............. Payment of distributions out of moneys held
by the Trust, and payments on liquidation of
the Trust or the redemption of Capital
Securities, are guaranteed by the Company to
the extent the Trust has funds available
therefor. If the Company does not make
principal or interest payments on the Junior
Subordinated Debentures, the Trust will not
have sufficient funds to make Distributions
on the Capital Securities, in which event the
Guarantee shall not apply to such
Distributions until the Trust has sufficient
funds available therefor. The Company's
obligations under the Guarantee, taken
together with its obligations under the
Junior Subordinated Debentures and the
Indenture, including its obligation to pay
all costs, expenses and liabilities of the
Trust (other than with respect to the Capital
Securities), constitute a full and
unconditional guarantee of all of the Trust's
obligations under the Capital Securities. See
"Description of Guarantee" and "Relationship
Among the Capital Securities, the Junior
Subordinated Debentures and the Guarantee."
The obligations of the Company under the
Guarantee are subordinate and junior in right
of payment to all Indebtedness of the
Company. See "Risk Factors -- Ranking of
Subordinated Obligations Under the Guarantee
and the Junior Subordinated Debentures" and
"Description of Guarantee."
Right to Defer
Interest............... The Company has the right to
defer payment of interest on
the Junior Subordinated Debentures by
extending the interest payment period on
the Junior Subordinated Debentures, from
time to time, for up to 10 consecutive
semi-annual periods. There could be
multiple Extension Periods of varying
lengths throughout the term of the
Junior Subordinated Debentures. If
interest payments on the Junior
Subordinated Debentures are so
deferred, distributions on the Capital
Securities will also be deferred for an
equivalent period and the Company may
not, and may not permit any subsidiary
of the Company to, (i) declare or pay
any dividends or distributions on, or
redeem, purchase, acquire, or make a
liquidation payment with respect to, the
Company's capital stock or (ii) make any
payment of principal, interest or
premium, if any, on or repay, repurchase
or redeem any debt securities that rank
pari passu with or junior to the Junior
Subordinated Debentures or make any
guarantee payments with respect to any
guarantee by the Company of the debt
securities of any subsidiary of the
Company if such guarantee ranks pari
passu with or junior to the Junior
Subordinated Debentures (other than (a)
repurchases, redemptions or other
14
<PAGE>
acquisitions of shares of capital stock
of the Company in connection with any
employment contract, benefit plan or
other similar arrangement with or for
the benefit of any one or more
employees, officers, directors or
consultants, or in connection with a
dividend reinvestment or stockholder
stock purchase plan, (b) as a result of
an exchange or conversion of any class
or series of the Company's capital stock
(or any capital stock of a subsidiary of
the Company) for any class or series of
the Company's capital stock or of any
class or series of the Company's
indebtedness for any class or series of
the Company's capital stock, (c) the
purchase of fractional interests in
shares of the Company's capital stock
pursuant to the conversion or exchange
provisions of such capital stock or the
security being converted or exchanged,
(d) any declaration of a dividend in
connection with any stockholder's rights
plans, or the issuance of rights, stock
or other property under any
stockholder's rights plan, or the
redemption or repurchase of rights
pursuant thereto, or (e) any dividend in
the form of stock, warrants, options or
other rights where the dividend stock or
the stock issuable upon exercise of such
warrants, options or other rights is the
same stock as that on which the dividend
is being paid (or ranks pari passu with
or junior to such stock). During an
Extension Period, interest on the Junior
Subordinated Debentures will continue to
accrue (and the amount of Distributions
to which holders of the Capital
Securities are entitled will accumulate)
at the rate of 9.10% per annum,
compounded semi-annually to the extent
permitted by applicable law. During an
Extension Period, holders of Capital
Securities will be required to include
the stated interest (and de minimis OID,
if any) on their pro rata share of the
Junior Subordinated Debentures in their
gross income as original issue discount
("OID") even though the cash payments
attributable thereto have not been made.
See "Description of Junior Subordinated
Debentures -- Option to Extend Interest
Payment Period" and "Certain United
States Federal Income Tax Consequences
-- Interest Income and Original Issue
Discount."
Redemption............ The Junior Subordinated Debentures are
redeemable by the Company in whole or in part
on or after June 1, 2007, or at any time, in
whole but not in part, upon the occurrence of
a Special Event, in either case subject to
any necessary prior approval of the Federal
Reserve. If the Junior Subordinated
Debentures are redeemed, the Trust must
redeem Trust Securities having an aggregate
liquidation amount equal to the aggregate
principal amount of the Junior Subordinated
Debentures so redeemed. The Trust Securities
will be redeemed upon maturity of the Junior
Subordinated Debentures. See "Description of
Capital Securities -- Redemption -- Mandatory
Redemption" and "-- Special Event Redemption
or Distribution of Junior Subordinated
Debentures."
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<PAGE>
Liquidation of
the Trust.............. The Company has the right at any
time, subject to any necessary
prior approval of the Federal Reserve,
to dissolve the Trust and after
satisfaction of the claims of creditors
of the Trust, if any, as provided by
applicable law cause the Junior
Subordinated Debentures to be
distributed to the holders of the
Capital Securities and the Common
Securities in liquidation of the Trust.
See "Description of Capital Securities
-- Redemption -- Special Event
Redemption or Distribution of Junior
Subordinated Debentures."
In the event of the liquidation of the
Trust, after satisfaction of the claims
of creditors of the Trust, if any, as
provided by applicable law, the holders
of the Capital Securities will be
entitled to receive a liquidation amount
of $1,000 per Capital Security plus
accumulated and unpaid Distributions
thereon to the date of payment, which
may be in the form of a distribution of
such amount in Junior Subordinated
Debentures as described above. If such
Liquidation Distribution (as defined
herein) can be paid only in part because
the Trust has insufficient assets
available to pay in full the aggregate
Liquidation Distribution, then the
amounts payable directly by the Trust on
the Capital Securities shall be paid on
a pro rata basis. The holder(s) of the
Common Securities will be entitled to
receive distributions upon any such
liquidation pro rata with the holders of
the Capital Securities, except that if
an Indenture Event of Default has
occurred and is continuing, the Capital
Securities shall have a priority over
the Common Securities. See "Description
of Capital Securities --Liquidation
Distribution Upon Dissolution."
Ratings................ It is expected that the New Capital
Securities will be rated "ba1" by Moody's
Investors Service, Inc., "BB" by Standard &
Poor's Ratings Services and "BBB--" by Duff &
Phelps Credit Rating Co. A security rating is
not a recommendation to buy, sell or hold
securities and may be subject to revision or
withdrawal at any time by the assigning
rating organization.
Absence of Market
for New Capital
Securities............. The New Capital Securities will be a new
issue of securities for which there is
currently no market. The New Capital
Securities will not be listed on a national
securities exchange and there can be no
assurance as to the development or liquidity
of any market for the New Capital Securities.
16
<PAGE>
RISK FACTORS
Prior to tendering Old Capital Securities in the Exchange
Offer, holders of the Old Capital Securities should carefully
review the information contained elsewhere in this Prospectus and
should particularly consider the following matters. To the extent
any of the information contained or incorporated by reference in
this Prospectus constitutes a "forward-looking statement" as
defined in Section 21E(i)(1) of the Exchange Act, the risk
factors set forth below are cautionary statements identifying
important factors that could cause actual results to differ
materially from those in the forward-looking statement.
Ranking of Subordinated Obligations under the Guarantee
and the Junior Subordinated Debentures
The obligations of the Company under the Guarantee issued
by the Company for the benefit of the holders of Capital
Securities and under the Junior Subordinated Debentures are
unsecured and rank subordinate and junior in right of payment to
all Indebtedness of the Company. At June 30, 1997, the
Indebtedness of the Company aggregated approximately $236
million. Neither the Indenture, the Guarantee nor the Declaration
(as defined herein) places any limitation on the amount of
secured or unsecured Indebtedness that may be incurred by the
Company. See "Description of Guarantee -- Status of the
Guarantee" and "Description of Junior Subordinated Debentures --
Subordination."
Status of Company as Holding Company
As a holding company, the ability of the Company to make
payments of interest and principal on the Junior Subordinated
Debentures will be dependent primarily upon the receipt of
dividends and other distributions from the Company's principal
subsidiaries, the Bank and its principal subsidiary, GPMC. There
are various regulatory restrictions on the ability of the Bank to
pay dividends or make other payments to the Company. At June 30,
1997, the Bank could pay an aggregate of $95.5 million in
dividends to the Company without prior regulatory approval. In
addition, the right of the Company to participate in any
distribution of assets of any subsidiary, including the Bank,
upon such subsidiary's liquidation or reorganization or otherwise
(and thus the ability of holders of the Capital Securities to
benefit indirectly from such distribution), will be subject to
the prior claims of creditors of that subsidiary, except to the
extent that any claims of the Company as a creditor of such
subsidiary may be recognized as such. Accordingly, the Capital
Securities will effectively be subordinated to all existing and
future liabilities and obligations of the Company's subsidiaries,
and holders of the Capital Securities should look only to the
assets of the Company for payments on the Capital Securities. As
of June 30, 1997, the Company's subsidiaries had indebtedness and
other liabilities of approximately $507 million.
Enforcement of Certain Rights by Holders of Capital Securities
If a Trust Enforcement Event (as defined herein) occurs and
is continuing, then the holders of Capital Securities would rely
on the enforcement by the Property Trustee (as defined herein) of
its rights as a holder of the Junior Subordinated Debentures
against the Company. The holders of a majority in liquidation
amount of the Capital Securities will have the right to direct
the time, method and place of
conducting any proceeding for any remedy available to the
Property Trustee or to direct the exercise of any trust or power
conferred upon the Property Trustee under the Declaration,
including the right to direct the Property Trustee to exercise
the remedies available to it as a holder of the Junior
Subordinated Debentures. If the Property Trustee fails to enforce
its rights with respect to the Junior Subordinated
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<PAGE>
Debentures held by the Trust, any record holder of Capital
Securities may, to the fullest extent permitted by law, institute
legal proceedings directly against the Company to enforce the
Property Trustee's rights under such Junior Subordinated
Debentures without first instituting any legal proceedings
against such Property Trustee or any other person or entity.
If the Company were to default on its obligation to pay
amounts payable under the Junior Subordinated Debentures, the
Trust would lack funds for the payment of Distributions or
amounts payable on redemption of the Capital Securities or
otherwise, and, in such event, holders of the Capital Securities
would not be able to rely upon the Guarantee for payment of such
amounts. However, in the event the Company failed to pay interest
on or principal of the Junior Subordinated Debentures on the
payment date on which such payment is due and payable, then a
holder of Capital Securities may directly institute a proceeding
against the Company under the Indenture for enforcement of
payment to such holder of the interest on or principal of such
Junior Subordinated Debentures having a principal amount equal to
the aggregate liquidation amount of the Capital Securities of
such holder (a "Direct Action"). In connection with such Direct
Action, the Company will be subrogated to the rights of such
holder of Capital Securities under the Declaration to the extent
of any payment made by the Company to such holder of Capital
Securities in such Direct Action. Except as set forth herein,
holders of Capital Securities will not be able to exercise
directly any other remedy available to the holders of Junior
Subordinated Debentures or assert directly any other rights in
respect of the Junior Subordinated Debentures. See "Description
of Capital Securities -- Enforcement of Certain Rights by Holders
of Capital Securities", "Description of Guarantee" and
"Description of Junior Subordinated Debentures Indenture Events
of Default." The Declaration provides that each holder of Capital
Securities by acceptance thereof agrees to the provisions of the
Guarantee and the Indenture.
Option to Extend Interest Payment Period; Tax Consequences
The Company has the right under the Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any
time or from time to time for a period not exceeding 10
consecutive semi-annual periods, provided that no Extension
Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. As a consequence of any such deferral,
semi-annual Distributions on the Capital Securities by the Trust
will be deferred during any such Extension Period but would
continue to accumulate at the rate of 9.10% per annum, compounded
semi-annually during any such Extension Period. During any such
Extension Period, the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital
stock or (ii) make any payment of principal, interest or premium,
if any, on or repay, repurchase or redeem any debt securities of
the Company that rank pari passu with or junior to the Junior
Subordinated Debentures or make any guarantee payments with
respect to any guarantee by the Company of the debt securities of
any subsidiary of the Company if such guarantee ranks pari passu
with or junior to the Junior Subordinated Debentures (other than
(a) repurchases, redemptions or other acquisitions of shares of
capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or
consultants, or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange
or conversion of any class or series of the Company's capital
stock (or any capital stock of a subsidiary of the Company) for
any class or series of the Company's capital stock or of any
class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of
fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any stockholder's
rights plans, or the issuance of rights, stock or other property
under
18
<PAGE>
any stockholder's rights plan, or the redemption or repurchase of
rights pursuant thereto, or (e) any dividend in the form of
stock, warrants, options or other rights where the dividend stock
or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is
being paid (or ranks pari passu with or junior to such stock).
Prior to the termination of any such Extension Period, the
Company may further extend the Extension Period, provided that no
Extension Period may exceed 10 consecutive semi-annual periods or
extend beyond the Stated Maturity of the Junior Subordinated
Debentures. Upon the termination of any Extension Period and the
payment of all amounts then due on any Interest Payment Date, the
Company may elect to begin a new Extension Period subject to the
above requirements. See "Description of Capital Securities --
Distributions" and "Description of Junior Subordinated Debentures
- -- Option to Extend Interest Payment Period."
Should the Company defer payment of interest on the Junior
Subordinated Debentures, a holder of Capital Securities will be
required to accrue income (in the form of OID) for United States
federal income tax purposes in respect of its pro rata share of
the Junior Subordinated Debentures held by the Trust. As a
result, a holder of Capital Securities will include such income
in gross income for United States federal income tax purposes in
advance of the receipt of cash attributable to such interest
income, and will not receive the cash related to such income from
the Trust if the holder disposes of the Capital Securities prior
to the record date for the payment of Distributions with respect
to such Extension Period. See "Certain United States Federal
Income Tax Consequences -- Interest Income and Original Issue
Discount" and "-- Sales of Capital Securities."
The Company has no current intention of exercising its
right to defer payments of interest by extending the interest
payment period on the Junior Subordinated Debentures. However,
should the Company elect to exercise such right in the future,
the market price of the Capital Securities is likely to be
adversely affected. A holder that disposes of its Capital
Securities during an Extension Period, therefore, might not
receive the same return on its investment as a holder that
continues to hold its Capital Securities. In addition, as a
result of the Company's right to defer interest payments, the
market price of the Capital Securities (which represent preferred
undivided beneficial interests in the Junior Subordinated
Debentures) may be more volatile than the market prices of other
similar securities where the issuer does not have such right to
defer interest payments.
Special Event Redemption
Upon the occurrence and continuation of a Special Event,
the Company has the right, subject to any necessary prior
approval of the Federal Reserve, to redeem the Junior
Subordinated Debentures in whole (but not in part) within 90 days
following the occurrence of such Special Event and thereby cause
a mandatory redemption of the Capital Securities and Common
Securities. A "Special Event" means a Tax Event, a Regulatory
Capital Event or an Investment Company Event (each as defined
herein).
Liquidation Distribution of Junior Subordinated Debentures
The Company has the right, at any time, subject to any
necessary prior approval of the Federal Reserve, to dissolve the
Trust and after satisfaction of claims of creditors of the Trust,
if any, as provided by applicable law cause the Junior
Subordinated Debentures to be distributed to the holders of the
Capital Securities and the Common Securities in liquidation of
the Trust. In addition, upon liquidation of the Trust and certain
other events, the Junior Subordinated Debentures may be
distributed to such holders. Under current United States federal
income tax law and interpretations thereof and assuming, as
expected, the Trust is treated as a grantor trust for United
States federal income tax purposes, a distribution by the Trust
of the Junior Subordinated Debentures pursuant to a liquidation
of the Trust will
19
<PAGE>
not be a taxable event to the Trust or to holders of the Capital
Securities, and will result in a holder of the Capital Securities
receiving directly such holder's pro rata share of the Junior
Subordinated Debentures (previously held indirectly through the
Trust). If, however, the liquidation of the Trust were to occur
because the Trust is subject to United States federal income tax
with respect to income accrued or received on the Junior
Subordinated Debentures as a result of the occurrence of a Tax
Event or otherwise, the distribution of Junior Subordinated
Debentures to holders of the Capital Securities by the Trust
could be a taxable event to the Trust and each holder, and
holders of the Capital Securities could be required to recognize
gain or loss as if they had exchanged their Capital Securities
for the Junior Subordinated Debentures they received upon the
liquidation of the Trust. See "Certain United States Federal
Income Tax Consequences -- Distribution of Junior Subordinated
Debentures or Cash Upon Liquidation of the Trust."
There can be no assurance as to the market prices for
Capital Securities or Junior Subordinated Debentures that may be
distributed in exchange for Capital Securities if a liquidation
of the Trust occurs. Accordingly, the Capital Securities that an
investor may purchase, whether in the Exchange Offer, the
secondary market or otherwise, or the Junior Subordinated
Debentures that a holder of Capital Securities may receive on
liquidation of the Trust, may trade at a discount to the price
that the investor paid to purchase the Capital Securities.
Because holders of Capital Securities may receive Junior
Subordinated Debentures on termination of the Trust, purchasers
of Capital Securities are also making an investment decision with
regard to the Junior Subordinated Debentures and should carefully
review all the information regarding the Junior Subordinated
Debentures contained herein. See "Description of Capital
Securities -- Redemption -- Special Event Redemption or
Distribution of Junior Subordinated Debentures" and "Description
of Junior Subordinated Debentures -- General."
Limited Voting Rights
Holders of Capital Securities generally will have limited
voting rights relating only to the modification of the Capital
Securities and certain other matters described herein. Holders of
Capital Securities will not be entitled to vote to appoint,
remove or replace any of the Trustees (as defined below), which
voting rights are vested exclusively in the holder of the Common
Securities. The Trustees and the Company may amend the
Declaration without the consent of holders of Capital Securities
to ensure that the Trust will be classified as a grantor trust
for United States federal income tax purposes even if such action
adversely affects the interests of such holders. See "Description
of Capital Securities -- Voting Rights; Amendment of the
Declaration."
Bank Regulatory Restrictions on Operations of the Trust
Because the Trust is a subsidiary of the Company, federal
banking authorities have the right to examine the Trust and its
activities. Under certain circumstances, including any
determination that the Company's relationship to the Trust
results in an unsafe and unsound banking practice, such banking
authorities will have the authority to issue orders which could
restrict the ability of the Trust to make distributions on or to
redeem the Capital Securities.
Absence of Public Market; Restrictions on Transfer
The Old Capital Securities are currently trading on the
PORTAL market. Prior to this Exchange Offer there has been no
public market for the New Capital Securities, however, and there
can be no assurance that such a market will develop. The New
Capital Securities will not be listed on any securities exchange.
The Initial Purchasers have previously advised the Company that
they intend to
20
<PAGE>
make a market in the Old Capital Securities; however, the Initial
Purchasers are not obligated to do so, and may discontinue any
such market-making activities at any time without notice. The
Initial Purchasers have also advised the Company that they intend
to make a market in the New Capital Securities after the
consummation of this Exchange Offer, as permitted by applicable
laws and regulations; however, the Initial Purchasers are not
obligated to do so, and may discontinue any such market-making
activities at any time without notice. Such market-making
activity will be subject to the limits imposed by the Securities
Act and the Exchange Act and may be limited during the Exchange
Offer. Therefore, there can be no assurance that an active market
for the Old Capital Securities or the New Capital Securities will
continue or develop, as the case may be. If a trading market for
the Capital Securities does develop, the Capital Securities may
trade at a discount from their initial offering price depending
upon prevailing interest rates, the market for similar
securities, the performance of the Company and other factors.
The Old Capital Securities have not been registered under
the Securities Act and may only be offered or sold pursuant to an
exemption from the registration requirements of the Securities
Act and applicable state securities laws or pursuant to an
effective registration statement under the Securities Act and
applicable state securities laws. Notwithstanding the
registration under the Securities Act of the New Capital
Securities in the Exchange Offer, which will generally permit
such New Capital Securities to be resold or otherwise transferred
without further registration under the Securities Act, holders
who are "affiliates" of the Company or the Trust within the
meaning of Rule 405 under the Securities Act may publicly offer
for sale or resell the New Capital Securities only in compliance
with such registration requirements or the provisions of Rule 144
under the Securities Act. Each tendering holder of the Old
Capital Securities will be deemed to have made certain
acknowledgments, representations and agreements in relation to
its affiliate status. In addition, each broker-dealer that
receives New Capital Securities for its own account pursuant to
the Exchange Offer, where the corresponding Old Capital
Securities were acquired by such broker-dealer as a result of
market-making activities or other trading activities, must
acknowledge that it will deliver a prospectus in connection with
any resale of such New Capital Securities. See "Plan of
Distribution."
Consequences of Highly Leveraged Transaction
The Indenture does not contain any provisions that afford
holders of the Junior Subordinated Debentures protection in the
event of a highly leveraged transaction, including a change of
control, or other similar transactions involving the Company that
may adversely affect such holders. See "Description of the Junior
Subordinated Debentures."
Guarantee Covers Distributions Only to the Extent the Trust
Has Sufficient Funds
The following payments with respect to the Capital
Securities, to the extent not paid by or on behalf of the Trust
(the "Guarantee Payments"), will be subject to the Guarantee: (i)
any accumulated and unpaid Distributions required to be paid on
the Capital Securities, to the extent that the Trust has
sufficient funds available therefor at the time, (ii) the
redemption price with respect to any Capital Securities called
for redemption, to the extent that the Trust has sufficient funds
available therefor at such time, or (iii) upon a voluntary or
involuntary dissolution, winding up or liquidation of the Trust
(unless the Junior Subordinated Debentures are distributed to
holders of the Capital Securities), the lesser of (a) the
aggregate liquidation amount of the Capital Securities and all
accrued and unpaid Distributions thereon to the date of payment
and (b) the amount of assets of the Trust remaining available for
distribution to holders of Capital Securities. The Company's
obligation to make a Guarantee Payment
21
<PAGE>
may be satisfied by direct payment of the required amounts by the
Company to the holders of the applicable Capital Securities or by
causing the Trust to pay such amounts to such holders.
The Guarantee is an irrevocable guarantee on a subordinated
basis of the Trust's obligations under the Capital Securities,
but applies only to the extent that the Trust has sufficient
funds available to make such payments.
Consequences of Failure to Exchange Old Capital Securities
The Old Capital Securities have not been registered under
the Securities Act or any state securities laws and therefore may
not be offered, sold or otherwise transferred except in
compliance with the registration requirements of the Securities
Act and any other applicable securities laws, or pursuant to an
exemption therefrom or in a transaction not subject thereto, and
in each case in compliance with certain other conditions and
restrictions. Old Capital Securities which remain outstanding
after consummation of the Exchange Offer will continue to bear a
legend reflecting such restrictions on transfer. In addition,
upon consummation of the Exchange Offer, holders of Old Capital
Securities which remain outstanding will not be entitled to any
rights to have such Old Capital Securities registered under the
Securities Act or to any similar rights under the Registration
Rights Agreement (subject to certain limited exceptions). The
Company and the Trust do not intend to register under the
Securities Act any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer (subject to
such limited exceptions, if applicable).
To the extent that Old Capital Securities are tendered and
accepted in the Exchange Offer, a holder's ability to sell
untendered Old Capital Securities could be adversely affected. In
addition, any trading market for Old Capital Securities which
remain outstanding after the Exchange Offer (including the PORTAL
market) could be adversely affected.
The New Capital Securities and any Old Capital Securities
which remain outstanding after consummation of the Exchange Offer
will constitute a single series of Capital Securities under the
Declaration and, accordingly, will vote together as a single
class for purposes of determining whether holders of the
requisite percentage in outstanding liquidation amount thereof
have taken certain actions or exercised certain rights under the
Declaration. See "Description of Capital Securities."
Exchange Offer Procedures
Issuance of the New Capital Securities in exchange for Old
Capital Securities pursuant to the Exchange Offer will be made
only after a timely receipt by the Exchange Agent of such Old
Capital Securities, a properly completed and duly executed Letter
of Transmittal or Agent's Message in lieu thereof and all other
required documents. Therefore, holders of the Old Capital
Securities desiring to tender such Old Capital Securities in
exchange for New Capital Securities should allow sufficient time
to ensure timely delivery. Neither the Company, the Trust nor the
Exchange Agent is under any duty to give notification of defects
or irregularities with respect to the tenders of Old Capital
Securities for exchange.
USE OF PROCEEDS
Neither the Company nor the Trust will receive any cash
proceeds from the issuance of the New Capital Securities offered
hereby. In consideration for issuing the New Capital Securities
in exchange for the Old Capital Securities as described in this
Prospectus, the Trust will receive Old Capital
22
<PAGE>
Securities in like liquidation amount. The Old Capital Securities
surrendered in exchange for the New Capital Securities will be
retired and canceled.
All of the proceeds from the sale of the Old Capital
Securities and the Common Securities were invested by the Trust
in Junior Subordinated Debentures. The Company has used and
expects to use the proceeds from the sale of such Junior
Subordinated Debentures for general corporate purposes, which may
include the repurchase of stock and the financing of possible
acquisitions. The Company regularly explores opportunities for
acquisitions of and holds discussions with financial institutions
and related businesses, and also regularly explores opportunities
for acquisitions of liabilities and assets of financial
institutions, and other financial services providers. Pending
such use, the net proceeds may be temporarily invested in
short-term obligations. See "Capitalization." The precise amounts
and timing of the application of proceeds will depend upon the
funding requirements of the Company and its subsidiaries and the
availability of other funds.
RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The Company's consolidated ratios of earnings to combined
fixed charges and preferred stock dividends requirements for each
of the periods indicated are set forth below:
Six Months
Six Months Ended Year Ended Ended Year Ended
June 30, December 31, December 30, June 30,
-------- ------------ ----------- ----------
1997 1996 1996 1995 1994 1993 1993 1992
----
Excluding 33.34x 56.92x 68.89x 193.62x 528.25x 488.50x 577.33x 571.40x
interest
on
deposits
Including 1.53x 1.40x 1.42x 1.57x 1.93x 1.85x 1.71x 1.47x
interest
on
deposits
For purposes of computing the ratio of earnings to combined
fixed charges and preferred stock dividend requirements, earnings
represents net income plus applicable income taxes, fixed charges
and preferred stock dividend requirements of a consolidated
subsidiary. Fixed charges, excluding interest expense on
deposits, represent interest expense on long-term debt and
one-third (the portion deemed to be representative of the
interest factor) of rents. Fixed charges, including interest
expense on deposits, represent interest expense on long-term
debt, one-third (the portion deemed to be representative of the
interest factor) of rents and interest expense on deposits.
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated
as a wholly-owned subsidiary of the Company and, accordingly, the
accounts of the Trust will be included in the consolidated
financial statements of the Company. The sole assets of the Trust
will be $206,185,567 aggregate principal amount of 9.10% Junior
Subordinated Debentures with a maturity date of June 1, 2027
issued by the Company to the Trust. The Capital Securities will
be presented in the consolidated statements of condition of the
Company as a separate line item in the liability section under
the caption "Guaranteed Preferred Beneficial Interests in
Company's Junior Subordinated Debentures" and appropriate
disclosures about the Capital Securities, the Guarantee and the
Junior Subordinated Debentures will be included in the notes to
the consolidated financial statements. For financial reporting
purposes, the Company will record Distributions payable on the
Capital Securities as interest expense in its consolidated
statements of income.
23
<PAGE>
REGULATORY TREATMENT
The Company is required by the Federal Reserve to maintain
certain levels of capital for bank regulatory purposes. The
Company expects that the Capital Securities will be treated as
Tier 1 capital of the Company for such purposes.
CAPITALIZATION
The following table sets forth the unaudited historical
consolidated capitalization of the Company and its subsidiaries
as of June 30, 1997. The issuance of the New Capital Securities
in the Exchange Offer will have no effect on the capitalization
of the Company.
(Dollars in Thousands)
Long-Term Debt
Guaranteed Preferred Beneficial
Interests in Company's Junior
Subordinated Debentures (1) $ 199,717
Stockholders' Equity (2) Capital ratios:
Tier 1 Capital 16.37%
Total Capital 17.62%
Tier 1 Leverage Ratio 7.95%
- ----------
(1) As described herein, the sole assets of the Trust are
$206,185,567 million principal amount of Junior
Subordinated Debentures issued by the Company to the Trust.
The Junior Subordinated Debentures will bear interest at
the rate of 9.10% per annum and will mature on June 1,
2027. The Company owns all of the Common Securities of the
Trust.
(2) In May, 1997, the Board of Directors of the Company
authorized the repurchase of up to $200 million of common
stock of the Company over an unspecified period, subject to
management's evaluation of market conditions and the
Company's financing needs.
THE TRUST
The Trust is a statutory business trust created under the
Delaware Business Trust Act, as amended (the "Trust Act"),
pursuant to a declaration of trust (as so amended and restated,
the "Declaration") and the filing of a certificate of trust with
the Secretary of State of the State of Delaware. The Company owns
Common Securities in an aggregate liquidation amount equal to at
least 3% of the total capital of the Trust. The Trust used all
the proceeds derived from the issuance of the Old Capital
Securities and the Common Securities to purchase the Old Junior
Subordinated Debentures and, accordingly, the assets of the Trust
consist solely of the Old Junior Subordinated Debentures. The
Trust exists for the exclusive purpose of (i) issuing the Trust
Securities representing undivided beneficial ownership interests
in the assets of the Trust, (ii) investing the gross proceeds of
the Trust Securities in the Junior Subordinated Debentures, and
(iii) engaging in only those other activities necessary or
incidental thereto.
24
<PAGE>
Pursuant to the Declaration, there are two trustees (the
"Trustees") for the Trust. One trustee is a financial institution
that is unaffiliated with the Company (the "Property Trustee").
The other trustee is an entity that maintains its principal place
of business in the State of Delaware and otherwise meets the
requirements of applicable law (the "Delaware Trustee"). The Bank
of New York is acting as initial Property Trustee, and its
affiliate, The Bank of New York (Delaware), is acting as initial
Delaware Trustee, and each of them will continue to so act until
removed or replaced by the holder of the Common Securities. The
Bank of New York also acts as trustee under the Guarantee (the
"Guarantee Trustee"). In addition, three individuals who are
employees or officers of or who are affiliated with the Company
act as administrators of the Trust (the "Administrators").
The Property Trustee holds title to the Junior Subordinated
Debentures for the benefit of the holders of the Trust
Securities, and the Property Trustee has the power to exercise
all rights, powers and privileges with respect to the Junior
Subordinated Debentures under the Indenture (as defined herein)
as the holder of the Junior Subordinated Debentures. In addition,
the Property Trustee maintains exclusive control of a segregated
non-interest bearing bank account (the "Property Account") to
hold all payments made in respect of the Junior Subordinated
Debentures for the benefit of the holders of the Trust
Securities. The Guarantee Trustee holds the Guarantee for the
benefit of the holders of the Capital Securities. The Company, as
the holder of all the Common Securities, has the right to
appoint, remove or replace any of the Trustees and to increase or
decrease the number of Trustees, provided that the number of
Trustees shall be at least two; provided further that at least
one Trustee shall be a Delaware Trustee and at least one Trustee
shall be the Property Trustee.
The Company, as borrower, has agreed to pay all fees and
expenses related to the organization and operations of the Trust
(including any taxes, duties, assessments or governmental charges
of whatever nature (other than withholding taxes) imposed by the
United States or any other domestic taxing authority upon the
Trust) and the offering of the Capital Securities and be
responsible for all debts and obligations of the Trust (other
than with respect to the Capital Securities).
For so long as the Capital Securities remain outstanding,
the Company will covenant (i) to maintain directly or indirectly
100% ownership of the Common Securities, (ii) to cause the Trust
to remain a statutory business trust and not to voluntarily
dissolve, wind-up, liquidate or be terminated, except as
permitted by the Declaration, (iii) to use its commercially
reasonable efforts to ensure that the Trust will not be an
"investment company" for purposes of the Investment Company Act
of 1940, as amended, and (iv) to take no action that would be
reasonably likely to cause the Trust to be classified as an
association or a publicly traded partnership taxable as a
corporation for United States federal income tax purposes.
The rights of the holders of the Capital Securities,
including economic rights, rights to information and voting
rights, are set forth in the Declaration and the Trust Indenture
Act. See "Description of Capital Securities." The Declaration and
the Guarantee also incorporate by reference the terms of the
Trust Indenture Act.
The location of the principal executive office of the Trust
is c/o GreenPoint Financial Corp., Attn. Chief Financial Officer,
90 Park Avenue, New York, New York 10016 and its telephone number
is (212) 834-1711.
25
<PAGE>
THE EXCHANGE OFFER
Purpose and Effect of Exchange Offer
In connection with the sale of the Old Capital Securities,
the Company and the Trust entered into the Registration Rights
Agreement with the Initial Purchasers pursuant to which the
Company and the Trust agreed to file and to use their best
efforts to cause to be declared effective by the Commission a
registration statement with respect to the exchange of the Old
Capital Securities for capital securities which have been
registered under the Securities Act with terms identical in all
material respects to the terms of the Old Capital Securities
(except as described below). A copy of the Registration Rights
Agreement has been filed as an exhibit to the Registration
Statement of which this Prospectus is a part.
The Exchange Offer is being made to satisfy the contractual
obligations of the Company and the Trust under the Registration
Rights Agreement. The form and terms of the New Capital
Securities are the same in all material respects as the form and
terms of the Old Capital Securities, except that the New Capital
Securities (i) have been registered under the Securities Act and
therefore will not be subject to certain restrictions on transfer
applicable to the Old Capital Securities and (ii) will not
provide for any increase in the distribution rate thereon. The
Old Capital Securities provide, among other things, that if,
under certain circumstances as set forth in the Registration
Rights Agreement, the Exchange Offer is not consummated by the
30th business day after the date on which the Registration
Statement was declared effective by the Commission, the
distribution rate borne by the Old Capital Securities will
increase by 0.05% per annum, increasing by increments of 0.05%
each week but in no event greater than 0.25%, until the Exchange
Offer is consummated. Upon consummation of the Exchange Offer,
holders of Old Capital Securities that remain outstanding will
not be entitled to any increase in the distribution rate thereon
or any further registration rights under the Registration Rights
Agreement, except under limited circumstances. See "Risk Factors
- -- Consequences of a Failure to Exchange Old Capital Securities"
and "Description of Capital Securities."
The Exchange Offer is not being made to, nor will the Trust
or the Company accept tenders for exchange from, holders of Old
Capital Securities in any jurisdiction in which the Exchange
Offer or the acceptance thereof would not be in compliance with
the securities or blue sky laws of such jurisdiction.
Unless the context requires otherwise, the term "holder"
with respect to the Exchange Offer means any person in whose name
the Old Capital Securities are registered on the books of the
Trust or any other person who has obtained a properly completed
bond power from the registered holder, or any person whose Old
Capital Securities are held of record by The Depository Trust
Company ("DTC") who desires to deliver such Old Capital
Securities by book-entry transfer at DTC.
Pursuant to the Exchange Offer, the Company will exchange
as soon as practicable after the date hereof all of the Old
Junior Subordinated Debentures, of which $206,185,567 aggregate
principal amount is outstanding, for a like aggregate principal
amount of the New Junior Subordinated Debentures. The New
Guarantee and the New Junior Subordinated Debentures have been
registered, to the extent required to be registered, under the
Securities Act.
Terms of Exchange
The Trust hereby offers, upon the terms and subject to the
conditions set forth in this Prospectus and in the accompanying
Letter of Transmittal, to exchange up to $200,000,000 aggregate
liquidation amount of New Capital Securities for a like aggregate
liquidation amount of Old Capital Securities
26
<PAGE>
properly tendered on or prior to the Expiration Date and not
properly withdrawn in accordance with the procedures described
below. The Trust will issue, promptly after the Expiration Date,
an aggregate liquidation amount of up to $200,000,000 of New
Capital Securities in exchange for a like aggregate liquidation
amount of outstanding Old Capital Securities tendered and
accepted in connection with the Exchange Offer. Holders may
tender their Old Capital Securities in whole or in part.
The Exchange Offer is not conditioned upon any minimum
liquidation amount of Old Capital Securities being tendered. As
of the date of this Prospectus, $200,000,000 aggregate
liquidation amount of the Old Capital Securities is outstanding.
Holders of Old Capital Securities do not have any appraisal
or dissenters' rights in connection with the Exchange Offer. Old
Capital Securities which are not tendered for, or are tendered
but not accepted in connection with, the Exchange Offer will
remain outstanding and be entitled to the benefits of the
Declaration, but will not be entitled to any further registration
rights under the Registration Rights Agreement, except under
limited circumstances. See "Risk Factors -- Consequences of a
Failure to Exchange Old Capital Securities" and "Description of
Capital Securities."
If any tendered Old Capital Securities are not accepted for
exchange because of an invalid tender, the occurrence of certain
other events set forth herein or otherwise, certificates for any
such unaccepted Old Capital Securities will be returned, without
expense, to the tendering holder thereof promptly after the
Expiration Date.
Holders who tender Old Capital Securities in connection
with this Exchange Offer will not be required to pay brokerage
commissions or fees or, subject to the instructions in the Letter
of Transmittal, transfer taxes with respect to the exchange of
Old Capital Securities in connection with the Exchange Offer. The
Company will pay all charges and expenses, other than certain
applicable taxes described below, in connection with the Exchange
Offer. See "-- Fees and Expenses."
NEITHER THE BOARD OF DIRECTORS OF THE COMPANY NOR ANY
ADMINISTRATOR OR TRUSTEE OF THE TRUST MAKES ANY RECOMMENDATION TO
HOLDERS OF OLD CAPITAL SECURITIES AS TO WHETHER TO TENDER OR
REFRAIN FROM TENDERING ALL OR ANY PORTION OF THEIR OLD CAPITAL
SECURITIES PURSUANT TO THE EXCHANGE OFFER. IN ADDITION, NO ONE
HAS BEEN AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. HOLDERS OF
OLD CAPITAL SECURITIES MUST MAKE THEIR OWN DECISION WHETHER TO
TENDER PURSUANT TO THE EXCHANGE OFFER AND, IF SO, THE AGGREGATE
AMOUNT OF OLD CAPITAL SECURITIES TO TENDER AFTER READING THIS
PROSPECTUS AND THE LETTER OF TRANSMITTAL AND CONSULTING WITH
THEIR ADVISERS, IF ANY, BASED ON THEIR OWN FINANCIAL POSITION AND
REQUIREMENTS.
Expiration Date; Extension; Amendments
The term "Expiration Date" means 5:00 p.m., New York City
time, on ________, 1997, unless the Exchange Offer is extended by
the Company and the Trust (in which case the term "Expiration
Date" shall mean the latest date and time to which the Exchange
Offer is extended).
The Company and the Trust expressly reserve the right in
their sole discretion, subject to applicable law, at any time and
from time to time, (i) to delay the acceptance of the Old Capital
Securities for exchange, (ii) to terminate the Exchange Offer
(whether or not any Old Capital Securities have theretofore been
accepted for exchange) if the Company and the Trust determine, in
their sole
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discretion, that any of the events referred to under "--
Conditions to the Exchange Offer" have occurred, (iii) to extend
the Expiration Date of the Exchange Offer, subject, however, to
the right of holders of Old Capital Securities to withdraw their
tendered Old Capital Securities as described under "-- Withdrawal
Rights," and (iv) to waive any condition or otherwise amend the
terms of the Exchange Offer in any respect. If the Exchange Offer
is amended in a manner determined by the Company and the Trust to
constitute a material change, or if the Company and the Trust
waive a material condition of the Exchange Offer, the Company and
the Trust will promptly disclose such amendment by means of an
amended or supplemented Prospectus that will be distributed to
the registered holders of the Old Capital Securities, and the
Company and the Trust will extend the Exchange Offer to the
extent required by Rule 14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination or
amendment will be followed promptly by oral or written notice
thereof to the Exchange Agent and by making a public announcement
thereof, and such announcement in the case of an extension will
be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date.
Without limiting the manner in which the Company and the Trust
may choose to make any public announcement and subject to
applicable law, the Company and the Trust shall have no
obligation to publish, advertise or otherwise communicate any
such public announcement other than by issuing a release to an
appropriate news agency.
Acceptance for Exchange and Issuance of New Capital Securities
Upon the terms and subject to the conditions of the
Exchange Offer, the Trust will exchange, and will issue to the
Exchange Agent, New Capital Securities for Old Capital Securities
validly tendered and not withdrawn (pursuant to the withdrawal
rights described under "-- Withdrawal Rights") promptly after the
Expiration Date.
In all cases, delivery of New Capital Securities in
exchange for Old Capital Securities tendered and accepted for
exchange pursuant to the Exchange Offer will be made only after
timely receipt by the Exchange Agent of (i) Old Capital
Securities or a book-entry confirmation of a book-entry transfer
of Old Capital Securities into the Exchange Agent's account at
DTC, (ii) the Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature
guarantees, or, in the case of a book-entry transfer, an Agent's
Message in lieu of the Letter of Transmittal, and (iii) any other
documents required by the Letter of Transmittal.
The term "book-entry confirmation" means a timely
confirmation of a book-entry transfer of Old Capital Securities
into the Exchange Agent's account at DTC. The term "Agent's
Message" means a message, transmitted by DTC to and received by
the Exchange Agent and forming a part of a book-entry
confirmation, which states that DTC has received an express
acknowledgment from the tendering Participant (as defined
herein), which acknowledgment states that such Participant has
received and agrees to be bound by the Letter of Transmittal and
that the Trust and the Company may enforce such Letter of
Transmittal against such Participant.
Subject to the terms and conditions of the Exchange Offer,
the Company and the Trust will be deemed to have accepted for
exchange, and thereby exchanged, Old Capital Securities validly
tendered and not withdrawn as, if and when the Trust gives oral
and written notice to the Exchange Agent of the Company's and the
Trust's acceptance of such Old Capital Securities for exchange
pursuant to the Exchange Offer. The Exchange Agent will act as
agent for the Company and the Trust for the purpose of receiving
tenders of Old Capital Securities, Letters of Transmittal and
related documents, and as agent
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for tendering holders for the purpose of receiving Old Capital
Securities, Letters of Transmittal and related documents and
transmitting New Capital Securities to validly tendering holders.
Such exchange will be made promptly after the Expiration Date. If
for any reason whatsoever acceptance for exchange or the exchange
of any Old Capital Securities tendered pursuant to the Exchange
Offer is delayed (whether before or after the Company's and the
Trust's acceptance for exchange of Old Capital Securities) or the
Company and the Trust extend the Exchange Offer or are unable to
accept for exchange or exchange Old Capital Securities tendered
pursuant to the Exchange Offer, then, without prejudice to the
Company's and the Trust's rights set forth herein, the Exchange
Agent may, nevertheless, on behalf of the Company and the Trust
and subject to Rule 14e-1(c) under the Exchange Act, retain
tendered Old Capital Securities and such Old Capital Securities
may not be withdrawn except to the extent tendering holders are
entitled to withdrawal rights as described under "-- Withdrawal
Rights."
Pursuant to the Letter of Transmittal or Agent's Message in
lieu thereof, a holder of Old Capital Securities will warrant and
agree that it has full power and authority to tender, exchange,
sell, assign and transfer Old Capital Securities, that the Trust
will acquire good, marketable and unencumbered title to the
tendered Old Capital Securities, free and clear of all liens,
restrictions, charges and encumbrances, and the Old Capital
Securities tendered for exchange are not subject to any adverse
claims or proxies. The holder also will warrant and agree that it
will, upon request, execute and deliver any additional documents
deemed by the Company, the Trust or the Exchange Agent to be
necessary or desirable to complete the exchange, sale, assignment
and transfer of the Old Capital Securities tendered pursuant to
the Exchange Offer.
Procedures for Tendering Old Capital Securities
Valid Tender. Except as set forth below, in order for Old
Capital Securities to be validly tendered pursuant to the
Exchange Offer, a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature
guarantees, or an Agent's Message in lieu of the Letter of
Transmittal, and any other required documents, must be received
by the Exchange Agent at its address set forth under "-- Exchange
Agent," on or prior to the Expiration Date and (i) tendered Old
Capital Securities must be received by the Exchange Agent, or
(ii) such Old Capital Securities must be tendered pursuant to the
procedures for book-entry transfer set forth below and a
book-entry confirmation, including an Agent's Message if the
tendering holder has not delivered a Letter of Transmittal, must
be received by the Exchange Agent, in each case on or prior to
the Expiration Date, or (iii) the guaranteed delivery procedures
set forth below must be complied with.
If less than all of the Old Capital Securities are
tendered, a tendering holder should fill in the amount of Old
Capital Securities being tendered in the appropriate box on the
Letter of Transmittal or so indicate in an Agent's Message in
lieu of the Letter of Transmittal. The entire amount of Old
Capital Securities delivered to the Exchange Agent will be deemed
to have been tendered unless otherwise indicated. See "-- Terms
of Exchange."
THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF
TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND
SOLE RISK OF THE TENDERING HOLDER, AND DELIVERY WILL BE DEEMED
MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF
DELIVERY IS BY MAIL, THEN REGISTERED MAIL, RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR AN OVERNIGHT DELIVERY SERVICE, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
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Book-Entry Transfer. The Exchange Agent will establish an
account with respect to the Old Capital Securities at DTC for
purposes of the Exchange Offer within two business days after the
date of this Prospectus. Any financial institution that is a
Participant in DTC's book-entry transfer facility system may make
a book-entry delivery of the Old Capital Securities by causing
DTC to transfer such Old Capital Securities into the Exchange
Agent's account at DTC in accordance with DTC's procedures for
transfers. However, although delivery of Old Capital Securities
may be effected through book-entry transfer into the Exchange
Agent's account at DTC, the Letter of Transmittal (or facsimile
thereof), properly completed and duly executed, with any required
signature guarantees, or an Agent's Message in lieu of the Letter
of Transmittal, and any other required documents, must in any
case be delivered to and received by the Exchange Agent at its
address set forth under "-- Exchange Agent" on or prior to the
Expiration Date, or the guaranteed delivery procedure set forth
below must be complied with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S
PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
Signature Guarantees. Certificates for the Old Capital
Securities need not be endorsed and signature guarantees on the
Letter of Transmittal are unnecessary unless (i) a certificate
for the Old Capital Securities is registered in a name other than
that of the person surrendering the certificate or (ii) such
registered holder completes the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" in the Letter of
Transmittal. In the case of (i) or (ii) above, such certificates
for Old Capital Securities must be duly endorsed or accompanied
by a properly executed bond power, with the endorsement or
signature on the bond power and on the Letter of Transmittal
guaranteed by a firm or other entity identified in Rule 17Ad-15
under the Exchange Act as an "eligible guarantor institution,"
including (as such terms are defined therein): (i) a bank; (ii) a
broker, dealer, municipal securities broker or dealer or
government securities broker or dealer; (iii) a credit union;
(iv) a national securities exchange, registered securities
association or clearing agency; or (v) a savings association that
is a participant in a Securities Transfer Association (an
"Eligible Institution"), unless surrendered on behalf of such
Eligible Institution. See Instruction 1 to the Letter of
Transmittal.
Guaranteed Delivery. If a holder desires to tender Old
Capital Securities pursuant to the Exchange Offer and the
certificates for such Old Capital Securities are not immediately
available or time will not permit all required documents to reach
the Exchange Agent on or before the Expiration Date, or the
procedures for book-entry transfer cannot be completed on a
timely basis, such Old Capital Securities may nevertheless be
tendered, provided that all of the following guaranteed delivery
procedures are complied with:
(i) such tenders are made by or through an Eligible
Institution;
(ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form accompanying
the Letter of Transmittal, is received by the Exchange
Agent, as provided below, on or prior to the Expiration
Date; and
(iii) the certificates (or book-entry confirmation)
representing all tendered Old Capital Securities, in proper
form for transfer, together with a properly completed and
duly executed Letter of Transmittal (or facsimile thereof)
or, in the case of a book-entry transfer, an Agent's
Message in lieu thereof, with any required signature
guarantees and any other documents required by the Letter
of Transmittal are received by the Exchange Agent within
three New York Stock Exchange trading days after the date
of execution of such Notice of Guaranteed Delivery.
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The Notice of Guaranteed Delivery may be delivered by hand,
or transmitted by facsimile or mail, to the Exchange Agent, and
must include a guarantee by an Eligible Institution in the form
set forth in such notice.
Notwithstanding any other provisions hereof, the delivery
of New Capital Securities in exchange for Old Capital Securities
tendered and accepted for exchange pursuant to the Exchange Offer
will in all cases be made only after timely receipt by the
Exchange Agent of such Old Capital Securities, or of a book-entry
confirmation with respect to such Old Capital Securities, and a
properly completed and duly
executed Letter of Transmittal (or facsimile thereof) or, in the
case of a book-entry transfer, an Agent's Message in lieu
thereof, together with any required signature guarantees and any
other documents required by the Letter of Transmittal.
Accordingly the delivery of New Capital Securities might not be
made to all tendering holders at the same time, and will depend
upon when Old Capital Securities, book-entry confirmations with
respect to Old Capital Securities and other required documents
are received by the Exchange Agent.
The Company's and the Trust's acceptance for exchange of
Old Capital Securities tendered pursuant to any of the procedures
described above will constitute a binding agreement among the
tendering holder, the Company and the Trust upon the terms and
conditions of the Exchange Offer.
Determination of Validity. All questions as to the form of
documents, validity, eligibility (including time of receipt) and
acceptance for exchange of any tendered Old Capital Securities
will be determined by the Company and the Trust, in their sole
discretion, whose determination shall be final and binding on all
parties. The Company and the Trust reserve the absolute right, in
their sole discretion, to reject any and all tenders determined
by them not to be in proper form or the acceptance of which may,
in the view of counsel to the Company or the Trust, be unlawful.
The Company and the Trust also reserve the absolute right,
subject to applicable law, to waive any of the conditions of the
Exchange Offer as set forth under "-- Conditions to the Exchange
Offer" or any condition or irregularity in any tender of Old
Capital Securities of any particular holder whether or not
similar conditions or irregularities are waived in the case of
other holders.
The Company's and the Trust's interpretation of the terms
and conditions of the Exchange Offer (including the Letter of
Transmittal and the instructions thereto) will be final and
binding. No tender of Old Capital Securities will be deemed to
have been validly made until all irregularities with respect to
such tender have been cured or waived. Neither the Company, the
Trust, any affiliates or assigns of the Company or the Trust, the
Exchange Agent nor any other person shall be under any duty to
give any notification of any irregularities in tenders or incur
any liability for failure to give any such notification.
If any Letter of Transmittal, endorsement, bond power,
power of attorney or any other document required by the Letter of
Transmittal is signed by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, such
person should so indicate when signing, and, unless waived by the
Trust, proper evidence satisfactory to the Company and the Trust,
in their sole discretion, of such person's authority to so act
must be submitted.
A beneficial owner of Old Capital Securities that are held
by or registered in the name of a broker, dealer, commercial
bank, trust company or other nominee or custodian is urged to
contact such entity promptly if such beneficial holder wishes to
participate in the Exchange Offer.
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<PAGE>
Resales of New Capital Securities
Based on existing interpretations by the staff of the
Commission set forth in no-action letters to third parties, and
subject to the immediately following sentence, the Company and
the Trust believe that New Securities issued pursuant to the
Exchange Offer in exchange for Old Securities may be offered for
resale, resold and otherwise transferred by a holder thereof
without further compliance with the registration and prospectus
delivery requirements of the Securities Act, provided that such
New Securities are acquired in the ordinary course of such
holder's business and that such holder is not participating, and
has no arrangement or understanding with any person to
participate, in a distribution (within the meaning of the
Securities Act) of such New Securities. However, any holder of
Old Capital Securities who is an "affiliate" of either the
Company or the Trust, a broker-dealer that acquires the Old
Capital Securities in a transaction other than a part of its
market-making activities or other trading activities or other
holder who intends to participate in the Exchange Offer for the
purpose of distributing New Capital Securities (i) will not be
able to rely on the interpretations by the staff of the
Commission set forth in the above-mentioned interpretative
letters, (ii) will not be able to tender such Old Capital
Securities in the Exchange Offer, and (iii) must comply with the
registration and prospectus delivery requirements of the
Securities Act in connection with any sale or other transfer of
such Old Capital Securities unless such sale is made pursuant to
an exemption from such requirements. Neither the Company nor the
Trust sought its own no-action letter and there can be no
assurance that the staff of the Commission would make a similar
determination with respect to the Exchange Offer as it has in
such no-action letters to third parties.
Each holder of Old Capital Securities (other than a
broker-dealer) who wishes to exchange Old Capital Securities for
New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an "affiliate" of the Company or the
Trust, (ii) any New Capital Securities to be received by it are
being acquired in the ordinary course of its business and (iii)
it has no arrangement or understanding with any person to
participate in a distribution (within the meaning of the
Securities Act) of such New Capital Securities. The Letter of
Transmittal contains the foregoing representations. In addition,
the Company and the Trust may require such holder, as a condition
to such holder's eligibility to participate in the Exchange
Offer, to furnish to the Company and the Trust (or an agent
thereof) in writing information as to the number of "beneficial
owners" (within the meaning of Rule 13d-3 under the Exchange Act)
on behalf of whom such holder holds the Old Capital Securities to
be exchanged in the Exchange Offer. Each broker-dealer that
receives New Capital Securities pursuant to the Exchange Offer in
exchange for Old Capital Securities acquired for its own account
as a result of market-making activities or other trading
activities (an "Exchanging Dealer") must acknowledge by execution
of the Letter of Transmittal or, in the case of a book-entry
transfer, delivery of an Agent's Message that it acquired the Old
Capital Securities for its own account as the result of
market-making activities or other trading activities and must
agree that it will deliver a prospectus meeting the requirements
of the Securities Act in connection with any resale of such New
Capital Securities. The Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, an Exchanging
Dealer will not be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act. Based on the position
taken by the staff of the Commission in the no-action letters
referred to above, the Company and the Trust believe that
Exchanging Dealers may fulfill their prospectus delivery
requirements with respect to the New Capital Securities received
upon exchange of such Old Capital Securities (other than Old
Capital Securities which represent an unsold allotment from the
original sale of the Old Capital Securities) with a prospectus
meeting the requirements of the Securities Act, which may be the
prospectus prepared for an exchange offer so long as it contains
a description of the plan of distribution with respect to the
resale of such New Capital Securities. Subject to certain
provisions set forth in the Registration Rights Agreement and to
the limitations set out herein, the Company and the Trust have
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agreed that this Prospectus, as it may be amended or supplemented
from time to time, may be used by an Exchanging Dealer in
connection with resales of such New Capital Securities for a
period ending one year after the Expiration Date (or longer, if
required by the Registration Rights Agreement). See "Plan of
Distribution." Any person, including any Exchanging Dealer, who
is an "affiliate" of the Company or the Trust may not rely on
such no-action letters and must comply with the registration and
prospectus delivery requirements of the Securities Act in
connection with any resale transaction.
In that regard, each Exchanging Dealer who surrenders Old
Capital Securities pursuant to the Exchange Offer will be deemed
to have agreed, by execution of the Letter of Transmittal or
delivery of the Agent's Message in lieu thereof, that, upon
receipt of notice from the Company or the Trust of the occurrence
of any event or the discovery of any fact which makes any
statement contained or incorporated by reference in this
Prospectus untrue in any material respect or which causes this
Prospectus to omit to state a material fact necessary in order to
make the statements contained or incorporated by reference
herein, in light of the circumstances under which they were made,
not misleading or of the occurrence of certain other events
specified in the Registration Rights Agreement, such Exchanging
Dealer will suspend the sale of New Securities pursuant to this
Prospectus until the Company or the Trust has amended or
supplemented this Prospectus to correct such misstatement or
omission and has furnished copies of the amended or supplemented
Prospectus to such Exchanging Dealer or the Company or the Trust
has given notice that the sale of the New Securities may be
resumed, as the case may be.
Withdrawal Rights
Except as otherwise provided herein, tenders of Old Capital
Securities may be withdrawn at any time on or prior to the
Expiration Date.
In order for a withdrawal to be effective a written or
facsimile transmission of such notice of withdrawal must be
timely received by the Exchange Agent at its address set forth
under "-- Exchange Agent" on or prior to the Expiration Date. Any
such notice of withdrawal must specify the name of the person who
tendered the Old Capital Securities to be withdrawn, the
aggregate liquidation amount of Old Capital Securities to be
withdrawn and (if certificates for such Old Capital Securities
have been tendered) the name of the registered holder of the Old
Capital Securities as set forth on the Old Capital Securities, if
different from that of the person who tendered such Old Capital
Securities. If Old Capital Securities have been delivered or
otherwise identified to the Exchange Agent, then prior to the
physical release of such Old Capital Securities, the tendering
holder must submit the certificate numbers shown on the
particular Old Capital Securities to be withdrawn and the
signature on the notice of withdrawal must be guaranteed by an
Eligible Institution, except in the case of Old Capital
Securities tendered for the account of an Eligible Institution.
If Old Capital Securities have been tendered pursuant to the
procedures for book-entry transfers set forth in "-- Procedures
for Tendering Old Capital Securities," the notice of withdrawal
must specify the name and number of the account at DTC to be
credited with the withdrawal of Old Capital Securities, in which
case a notice of withdrawal will be effective if delivered to the
Exchange Agent by written, telegraphic, telex or facsimile
transmission. Withdrawals of tenders of Old Capital Securities
may not be rescinded. Old Capital Securities properly withdrawn
will not be deemed validly tendered for purposes of the Exchange
Offer, but may be retendered at any subsequent time on or prior
to the Expiration Date by following any of the procedures
described above under "-- Procedures for Tendering Old Capital
Securities."
All questions as to the validity, form and eligibility
(including time of receipt) of such withdrawal notices will be
determined by the Company and the Trust, in their sole
discretion, whose
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determination shall be final and binding on all parties. Neither
the Company, the Trust, any affiliates or assigns of the Company
or the Trust, the Exchange Agent nor any other person shall be
under any duty to give any notification of any irregularities in
any notice of withdrawal or incur any liability for failure to
give any such notification. Any Old Capital Securities which have
been tendered but which are withdrawn will be returned to the
holder thereof promptly after withdrawal.
Distributions on New Capital Securities
Holders of Old Capital Securities whose Old Capital
Securities are accepted for exchange will not receive accumulated
distributions on such Old Capital Securities for any period from
and after the last Distribution Payment Date with respect to such
Old Capital Securities prior to the original issue date of the
New Capital Securities or, if no such distributions have been
made, will not receive any accumulated distributions on such Old
Capital Securities, and will be deemed to have waived the right
to receive any distributions on such Old Capital Securities
accumulated from and after such Distribution Payment Date or, if
no such distributions have been made, from and after June 3,
1997.
Conditions to the Exchange Offer
Notwithstanding any other provision of the Exchange Offer,
or any extension of the Exchange Offer, the Company and the Trust
will not be required to accept for exchange, or to exchange, any
Old Capital Securities for any New Capital Securities, and, as
described below, may terminate the Exchange Offer (whether or not
any Old Capital Securities have theretofore been accepted for
exchange) or may waive any conditions to or amend the Exchange
Offer, if because of any change in law, or applicable
interpretations thereof by the Commission, the Company or the
Trust determines that it is not permitted to effect the Exchange
Offer.
If the Company and the Trust determine in their sole
discretion that any of the foregoing events has occurred, the
Company and the Trust may, subject to applicable law, terminate
the Exchange Offer (whether or not any Old Capital Securities
have theretofore been accepted for exchange) or may waive any
condition to the Exchange Offer or otherwise amend the terms of
the Exchange Offer in any respect. If such waiver or amendment
constitutes a material change to the Exchange Offer, the Company
and the Trust will promptly disclose such waiver or amendment by
means of an amended or supplemented Prospectus that will be
distributed to the registered holders of the Old Capital
Securities, and the Company and the Trust will extend the
Exchange Offer to the extent required by Rule 14e-1 under the
Exchange Act.
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Exchange Agent
The Bank of New York has been appointed as Exchange Agent
for the Exchange Offer. Delivery of the Letters of Transmittal
and any other required documents, questions, requests for
assistance and requests for additional copies of this Prospectus
or of the Letter of Transmittal should be directed to the
Exchange Agent as follows:
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Enrique Lopez,
Reorganization Section, Floor 7E
Telephone: (212) 815-2742
Facsimile: (212) 815-6339
Delivery to other than the above address or facsimile
number will not constitute a valid delivery.
Fees and Expenses
The Company has agreed to pay the Exchange Agent reasonable
and customary fees for its services and will reimburse it for its
reasonable and documented out-of-pocket expenses in connection
therewith. The Company will also pay brokerage houses and other
custodians, nominees and fiduciaries the reasonable out-of-pocket
expenses incurred by them in forwarding copies of this Prospectus
and related documents to the beneficial owners of Old Capital
Securities, and in handling or tendering for their customers.
Holders who tender their Old Capital Securities for
exchange will not be obligated to pay any transfer taxes in
connection therewith. If, however, New Capital Securities are to
be delivered to, or are to be issued in the name of, any person
other than the registered holder of the Old Capital Securities
tendered, or if a transfer tax is imposed for any reason other
than the exchange of Old Capital Securities in connection with
the Exchange Offer, then the amount of any such transfer taxes
(whether imposed on the registered holder or any other persons)
will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted
with the Letter of Transmittal, the amount of such transfer taxes
will be billed to such tendering holder.
Neither the Company nor the Trust will make any payment to
brokers, dealers or others soliciting acceptance of the Exchange
Offer.
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DESCRIPTION OF CAPITAL SECURITIES
Pursuant to the terms of the Declaration, the Trust has
issued the Old Capital Securities and the Common Securities and
will issue the New Capital Securities. The Capital Securities
represent undivided beneficial ownership interests in the assets
of the Trust and the holders thereof are entitled to a preference
in certain circumstances with respect to Distributions and
amounts payable on redemption or liquidation over the Common
Securities, as well as other benefits as described in the
Declaration. This summary of certain provisions of the Capital
Securities and the Declaration does not purport to be complete
and is subject to, and is qualified in its entirety by reference
to, all the provisions of the Declaration, including the
definitions therein of certain terms, and the Trust Indenture
Act. Wherever particular defined terms of the Declaration (as
supplemented or amended from time to time) are referred to
herein, the definitions of such defined terms are incorporated
herein by reference.
General
The Capital Securities rank pari passu, and payments will
be made thereon pro rata, with the Common Securities except as
described under "-- Subordination of Common Securities." Legal
title to the Junior Subordinated Debentures is held by the
Property Trustee in trust for the benefit of the holders of the
Capital Securities and the Common Securities. The Guarantee
executed by the Company for the benefit of the holders of the
Capital Securities is a guarantee on a subordinated basis with
respect to the Capital Securities but does not guarantee payment
of Distributions or amounts payable on redemption or liquidation
of the Capital Securities when the Trust does not have sufficient
funds available to make such payments. See "Description of
Guarantee." The Company's obligations under the Guarantee, taken
together with its obligations under the Junior Subordinated
Debentures and the Indenture, including its obligation to pay all
costs, expenses and liabilities of the Trust (other than with
respect to the Capital Securities), constitute a full and
unconditional guarantee of all of the Trust's obligations under
the Capital Securities.
Holders of the Capital Securities have no preemptive or
similar rights.
Distributions
Distributions on each Capital Security are payable at the
annual rate of 9.10% of the liquidation amount of $1,000, payable
semi-annually in arrears on the 1st day of June and December of
each year. Distributions will accumulate from June 3, 1997, the
date of original issuance of the Old Capital Securities, and
commence on December 1, 1997. The amount of Distributions payable
for any period will be computed on the basis of a 360-day year of
twelve 30-day months.
Distributions on the Capital Securities must be paid on the
dates payable to the extent that the Trust has funds available
for the payment of such Distributions. The revenue of the Trust
available for distribution to holders of its Capital Securities
is limited to payments under the Junior Subordinated Debentures
owned by the Trust. See "Description of Junior Subordinated
Debentures." If the Company does not make interest payments on
the Junior Subordinated Debentures, the Property Trustee will not
have funds available to pay Distributions on the Capital
Securities.
The Company has the right under the Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any
time or from time to time for a period not exceeding ten
consecutive semi- annual periods (each, an "Extension Period"),
provided that no Extension Period may extend beyond the Stated
Maturity of the Junior Subordinated Debentures. Accordingly,
there could be multiple
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Extension Periods of varying lengths throughout the term of the
Junior Subordinated Debentures. As a consequence of any such
extension, semi-annual Distributions on the Capital Securities
will be deferred by the Trust during any such Extension Period.
Distributions to which holders of the Capital Securities are
entitled will accumulate and compound semi-annually to the extent
permitted by applicable law at the rate per annum of 9.10%
thereof from the relevant payment date for such Distributions.
The term "Distributions" as used herein shall include any such
compounded amounts unless the context otherwise requires. During
any such Extension Period, the Company may not, and may not
permit any subsidiary of the Company to, (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or
make a liquidation payment with respect to, any of the Company's
capital stock or (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt
securities of the Company that rank pari passu with or junior to
the Junior Subordinated Debentures or make any guarantee payments
with respect to any guarantee by the Company of the debt
securities of any subsidiary of the Company if such guarantee
ranks pari passu with or junior in interest to the Junior
Subordinated Debentures (other than (a) dividends or
distributions in common stock of the Company, (b) payments under
the Guarantee, (c) any declaration of a dividend in connection
with the implementation of a shareholders' rights plan, or the
issuance of stock under any such plan in the future, or the
redemption or repurchase of any such rights pursuant thereto, and
(d) purchases of common stock related to the issuance of common
stock or rights under any of the Company's benefit plans). Prior
to the termination of any such Extension Period, the Company may
further extend the Extension Period, provided that no Extension
Period may exceed 10 consecutive semi-annual periods or extend
beyond the Stated Maturity of the Junior Subordinated Debentures.
Upon the termination of any such Extension Period and the payment
of all amounts then due on any Interest Payment Date, the Company
may elect to begin a new Extension Period subject to the
foregoing requirements. See "Description of Junior Subordinated
Debentures -- Option to Extend Interest Payment Period." The
Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period of
the Junior Subordinated Debentures.
In the event that any date on which Distributions are
payable on the Capital Securities is not a Business Day, then
payment of the Distributions payable on such date will be made on
the next succeeding day that is a Business Day (and without any
additional Distributions or other payment in respect of any such
delay), with the same force and effect as if made on the date
such payment was originally payable (each date on which
Distributions are payable in accordance with the foregoing, a
"Distribution Date"). A "Business Day" shall mean any day other
than a Saturday or a Sunday, or a day on which banking
institutions in The City of New York are authorized or required
by law or executive order to remain closed or a day on which the
principal corporate trust office of the Property Trustee or the
Indenture Trustee (as defined herein) is closed for business.
Distributions on the Capital Securities (other than
distributions on a Redemption Date) will be payable to the
holders thereof as they appear on the register of the Trust on
the relevant record dates, which shall be the first day of the
month of the relevant Distribution Date. Distributions payable on
any Capital Securities that are not punctually paid on any
Distribution Date will cease to be payable to the person in whose
name such Capital Securities are registered on the relevant
record date, and such defaulted Distributions will instead be
payable to the person in whose name such Capital Securities are
registered on the special record date or other specified date
determined in accordance with the Declaration.
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Redemption
Mandatory Redemption. Unless a Special Event has occurred,
the Capital Securities will not be redeemable prior to June 1,
2007. Upon the repayment or redemption, in whole or in part, of
the Junior Subordinated Debentures, whether at Stated Maturity or
upon earlier redemption as provided in the Indenture, the
proceeds from such repayment or redemption shall be applied by
the Property Trustee to redeem Capital Securities and Common
Securities upon not less than 30 nor more than 60 days' notice
prior to the date fixed for repayment or redemption. If less than
all of the Junior Subordinated Debentures are to be repaid or
redeemed on a Redemption Date, then the proceeds from such
repayment or redemption shall be allocated to the redemption pro
rata of the Capital Securities and the Common Securities.
Special Event Redemption or Distribution of Junior
Subordinated Debentures. If a Special Event shall occur and be
continuing, the Company will have the right, subject to the
receipt of any necessary prior approval of the Federal Reserve,
to either (i) redeem within 90 days following the occurrence of
such Special Event the Junior Subordinated Debentures on the date
of redemption (the "Redemption Date") in whole (but not in part)
and thereby cause a mandatory redemption of the Capital
Securities in whole (but not in part) at a redemption price with
respect to the Capital Securities equal to the redemption price
in respect of the Junior Subordinated Debentures or (ii) dissolve
the Trust and, after satisfaction of the claims of creditors of
the Trust as provided by applicable law, cause the Junior
Subordinated Debentures to be distributed to the holders of the
Capital Securities in liquidation of the Trust. Under current
United States federal income tax law and interpretations thereof
and assuming, as expected, the Trust is treated as a grantor
trust, a distribution of the Junior Subordinated Debentures
should not be a taxable event to holders of the Capital
Securities. Should there be a change in law, a change in legal
interpretation, certain Tax Events or other circumstances,
however, the distribution could be a taxable event to holders of
the Capital Securities. See "Certain United States Federal Income
Tax Consequences -- Distribution of Junior Subordinated
Debentures or Cash upon Liquidation of the Trust."
If the Company does not elect either option described
above, the Capital Securities will remain outstanding until the
repayment of the Junior Subordinated Debentures, whether at
maturity or redemption, and in the event a Tax Event has occurred
and is continuing, the Company will be obligated to pay any
additional taxes, duties, assessments and other governmental
charges (other than withholding taxes) to which the Trust has
become subject as a result of a Tax Event.
A "Special Event" means a Tax Event, a Regulatory Capital
Event or an Investment Company Event. A "Tax Event" means the
receipt by the Company of an opinion of counsel, rendered by a
law firm having a recognized national tax practice, to the effect
that, as a result of any amendment to, change in or announced
proposed change in the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement or decision is
announced on or after May 29, 1997, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90
days of the date of such opinion, subject to United States
federal income tax with respect to income received or accrued on
the Junior Subordinated Debentures, (ii) interest payable by the
Company on such Junior Subordinated Debentures is not, or within
90 days of the date of such opinion will not be, deductible by
the Company, in whole or in part, for United States federal
income tax purposes, or (iii) the Trust is, or will be within 90
days of the date of such opinion, subject to more than a de
minimis amount of other taxes, duties or other governmental
charges. A "Regulatory Capital Event" means that the Company
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shall have received an opinion of independent bank regulatory
counsel experienced in such matters to the effect that, as a
result of (a) any amendment to or change (including any announced
prospective change) in the laws (or any regulations thereunder)
of the United States or any rules, guidelines or policies of the
Federal Reserve or (b) any official administrative pronouncement
or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such
pronouncement or decision is announced on or after June 3, 1997,
the Capital Securities do not constitute, or within 90 days of
the date thereof will not constitute, Tier I capital (or its then
equivalent); provided, however, that the distribution of the
Junior Subordinated Debentures in connection with the liquidation
of the Trust by the Company shall not in and of itself constitute
a Regulatory Capital Event unless such liquidation shall have
occurred in connection with a Tax Event or an Investment Company
Event. "Investment Company Event" means the receipt by the Trust
of an opinion of counsel, rendered by a law firm having a
recognized national securities practice, to the effect that, as a
result of the occurrence of a change in law or regulation or a
change in interpretation or application of law or regulation by
any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), the Trust is or will be
considered an "investment company" that is required to be
registered under the Investment Company Act of 1940, as amended,
which Change in 1940 Act Law becomes effective on or after June
3, 1997.
Redemption Procedures
Capital Securities redeemed on each Redemption Date shall
be redeemed at the redemption price in respect of the Junior
Subordinated Debentures (the "Redemption Price") with the
applicable proceeds from the contemporaneous redemption or
payment at Stated Maturity of the Junior Subordinated Debentures.
Redemptions of the Capital Securities shall be made and the
Redemption Price shall be payable on each Redemption Date only to
the extent that the Trust has sufficient funds available for the
payment of such Redemption Price. See also "-- Subordination of
Common Securities."
Notice of any redemption will be mailed at least 30 days
but not more than 60 days before the Redemption Date to each
holder of Capital Securities to be redeemed at its registered
address. If the Trust gives a notice of redemption in respect of
the Capital Securities, then, by 12:00 noon, New York City time,
on the Redemption Date, to the extent funds are available, the
Property Trustee will deposit irrevocably with DTC or its nominee
funds sufficient to pay the applicable Redemption Price for all
securities held in DTC and will give DTC irrevocable instructions
and authority to pay the Redemption Price to the holders of the
Capital Securities. See "-- Book-Entry Issuance." If any Capital
Securities are held in certificated form, the Trust, to the
extent funds are available, will irrevocably deposit with the
paying agent for such Capital Securities funds sufficient to pay
the applicable Redemption Price and will give the paying agent
irrevocable instructions and authority to pay the Redemption
Price to the holders thereof upon surrender of their certificates
evidencing the Capital Securities. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any
Capital Security called for redemption shall be payable to the
holders of such Capital Security on the relevant record dates for
the related Distribution Dates. If notice of redemption shall
have been given and funds deposited as required, then upon the
date of such deposit, all rights of the holders of such Capital
Securities so called for redemption will cease, except the right
of the holders of such Capital Securities to receive the
Redemption Price, but without interest on such Redemption Price,
and such Capital Securities will cease to be outstanding. In the
event that any date fixed for redemption of Capital Securities is
not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day which is a
Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day
falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with the same
force and effect as if made on the date such payment was
originally payable. In the event that payment of the Redemption
Price in respect of
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Capital Securities called for redemption is improperly
withheld or refused and not paid either by the Trust or by the
Company pursuant to the Guarantee as described under "Description
of Guarantee," Distributions on such Capital Securities will
continue to accrue at the then applicable rate, from the
Redemption Date originally established by the Trust for the
Capital Securities to the date such Redemption Price is actually
paid, in which case the actual payment date will be the date
fixed for redemption for purposes of calculating the Redemption
Price.
Subject to applicable law (including, without limitation,
United States federal securities law), the Company or its
subsidiaries may at any time and from time to time purchase
outstanding Capital Securities by tender, in the open market or
by private agreement.
The Trust may not redeem fewer than all of the outstanding
Capital Securities unless all accrued and unpaid distributions
have been paid on all Capital Securities for all semi-annual
distribution periods terminating on or prior to the date of
redemption. If less than all of the Capital Securities and Common
Securities issued by the Trust are to be redeemed on a Redemption
Date, then the aggregate amount of such Capital Securities and
Common Securities to be redeemed shall be allocated pro rata
among the Capital Securities and the Common Securities. If the
Capital Securities are in book-entry form, they will be redeemed
as described below under "Book-Entry Issuance." If not, the
particular Capital Securities to be redeemed shall be selected on
a pro rata basis not more than 60 days prior to the Redemption
Date by the Property Trustee from the outstanding Capital
Securities not previously called for redemption, by such method
as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for redemption of portions (equal
to $1,000 or an integral multiple of $1,000 in excess thereof) of
the liquidation amount of Capital Securities of a denomination
larger than $1,000. The Property Trustee shall promptly notify
the Trust registrar in writing of the Capital Securities selected
for redemption and, in the case of any Capital Security selected
for partial redemption, the liquidation amount thereof to be
redeemed. For all purposes of the Declaration, unless the context
otherwise requires, all provisions relating to the redemption of
Capital Securities shall relate, in the case of any Capital
Security redeemed or to be redeemed only in part, to the portion
of the aggregate liquidation amount of Capital Securities which
has been or is to be redeemed.
Subordination of Common Securities
Payment of Distributions on, and the Redemption Price of,
the Capital Securities and the Common Securities, as applicable,
shall be made pro rata based on the liquidation amount of such
Capital Securities and Common Securities; provided, however, that
if on any Distribution Date or Redemption Date an Indenture Event
of Default shall have occurred and be continuing, no payment of
any Distribution on, or Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption,
liquidation or other acquisition of such Common Securities, shall
be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Capital Securities
for all Distribution periods terminating on or prior thereto, or
in the case of payment of the Redemption Price the full amount of
such Redemption Price on all of the outstanding Capital
Securities then called for redemption, shall have been made or
provided for, and all funds available to the Property Trustee
shall first be applied to the payment in full in cash of all
Distributions on, or Redemption Price of, the Capital Securities
then due and payable.
Liquidation Distribution Upon Dissolution
Pursuant to the Declaration, the Trust shall automatically
dissolve upon expiration of its term and shall dissolve on the
first to occur of: (i) certain events of bankruptcy, dissolution
or liquidation of
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the Company; (ii) the distribution of the Junior Subordinated
Debentures to the holders of the Capital Securities and Common
Securities; (iii) the repayment of all of the Capital Securities
in connection with the maturity or redemption of all of the
Junior Subordinated Debentures; and (iv) the entry by a court of
competent jurisdiction of an order for the dissolution of the
Trust.
If an early dissolution occurs as described in clause (i),
(ii) or (iv) above, the Trust shall be liquidated by the Trustees
as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of
the Trust, if any, as provided by applicable law, to the holders
of the Capital Securities and Common Securities their pro rata
interest in the Junior Subordinated Debentures, unless such
distribution is determined by the Property Trustee not to be
practicable, in which event such holders will be entitled to
receive out of the assets of the Trust available for distribution
to holders, after satisfaction of liabilities to creditors of the
Trust, if any, as provided by applicable law, an amount equal to,
in the case of holders of Capital Securities, the aggregate of
the liquidation amount plus accrued and unpaid Distributions
thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can
be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution,
then the amounts payable directly by the Trust on the Capital
Securities shall be paid on a pro rata basis. The holder(s) of
the Common Securities will be entitled to receive distributions
upon any such liquidation pro rata with the holders of the
Capital Securities, except that if an Indenture Event of Default
has occurred and is continuing, the Capital Securities shall have
a priority over the Common Securities.
After the liquidation date is fixed for any distribution of
Junior Subordinated Debentures to holders of the Capital
Securities (i) the Capital Securities will no longer be deemed to
be outstanding, (ii) DTC or its nominee, as a record holder of
Capital Securities, will receive a registered global certificate
or certificates representing the Junior Subordinated Debentures
to be delivered upon such distribution and (iii) any certificates
representing Capital Securities held in certificated form will be
deemed to represent Junior Subordinated Debentures having a
principal amount equal to the liquidation amount of such Capital
Securities, and bearing accrued and unpaid interest in an amount
equal to the accrued and unpaid Distributions on such Capital
Securities until such certificates are presented for cancellation
whereupon the Company will issue to such holder, and the
Indenture Trustee will authenticate, a certificate representing
such Junior Subordinated Debentures.
Trust Enforcement Events
An Indenture Event of Default constitutes a Trust
Enforcement Event under the Declaration with respect to the Trust
Securities, provided that pursuant to the Declaration, the holder
of the Common Securities will be deemed to have waived any Trust
Enforcement Event with respect to the Common Securities until all
Trust Enforcement Events with respect to the Capital Securities
have been cured, waived or otherwise eliminated. Until such Trust
Enforcement Event with respect to the Capital Securities has been
so cured, waived or otherwise eliminated, the Property Trustee
will be deemed to be acting solely on behalf of the holders of
the Capital Securities and only the holders of the Capital
Securities will have the right to direct the Property Trustee
with respect to certain matters under the Declaration, and
therefore the Indenture.
Upon the occurrence of a Trust Enforcement Event, the
Indenture Trustee (as defined herein) or the Property Trustee as
the holder of the Junior Subordinated Debentures will have the
right under the Indenture to declare the principal of and
interest on the Junior Subordinated Debentures to be immediately
due and payable. Each of the Company and the Trust is required to
file annually with the
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Property Trustee an officer's certificate as to its compliance
with all conditions and covenants under the Declaration.
If the Property Trustee fails to enforce its rights with
respect to the Junior Subordinated Debentures held by the Trust,
any record holder of Capital Securities may, to the fullest
extent permitted by law, institute legal proceedings directly
against the Company to enforce the Property Trustee's rights
under such Junior Subordinated Debentures without first
instituting any legal proceedings against such Property Trustee
or any other person or entity. In addition, if a Trust
Enforcement Event has occurred and is continuing and such event
is attributable to the failure of the Company to pay interest,
principal or other required payments on the Junior Subordinated
Debentures issued to the Trust on the date such interest,
principal or other payment is otherwise payable, then a record
holder of Capital Securities may, on or after the respective due
dates specified in the Junior Subordinated Debentures, institute
a proceeding directly against the Company under the Indenture for
enforcement of payment on Junior Subordinated Debentures having a
principal amount equal to the aggregate liquidation amount of the
Capital Securities held by such holder. In connection with such
Direct Action, the Company will be subrogated to the rights of
such record holder of Capital Securities to the extent of any
payment made by the Company to such record holder of Capital
Securities.
Voting Rights; Amendment of the Declaration
Except as provided below and under "Description of
Guarantee -- Amendments and Assignment" and as otherwise required
by law and the Declaration, the holders of the Capital Securities
have no voting rights.
So long as any Junior Subordinated Debentures are held by
the Property Trustee, the Trustees shall not (i) direct the time,
method and place of conducting any proceeding for any remedy
available to the Indenture Trustee or executing any trust or
power conferred on the Property Trustee with respect to such
Junior Subordinated Debentures, (ii) waive any past default that
is waivable under the Indenture, (iii) exercise any right to
rescind or annul a declaration that the principal of all the
Junior Subordinated Debentures shall be due and payable, or (iv)
consent to any amendment, modification or termination of the
Indenture or such Junior Subordinated Debentures, where such
consent shall be required, without, in each case, obtaining the
prior approval of the holders of a majority in aggregate
liquidation amount of all outstanding Capital Securities;
provided, however, that where a consent under the Indenture would
require the consent of each holder of Junior Subordinated
Debentures affected thereby, no such consent shall be given by
the Property Trustee without the prior consent of each holder of
Capital Securities. The Trustees shall not revoke any action
previously authorized or approved by a vote of the holders of the
Capital Securities except pursuant to a subsequent vote of the
holders of the Capital Securities. The Property Trustee shall
notify each holder of record of the Capital Securities of any
notice of default which it receives with respect to the Junior
Subordinated Debentures. In addition to obtaining the foregoing
approvals of the holders of the Capital Securities, prior to
taking any of the foregoing actions, the Trustees shall receive
an opinion of counsel experienced in such matters to the effect
that the Trust will not be classified as other than a grantor
trust for United States federal income tax purposes on account of
such action.
The Declaration may be amended from time to time by the
Company and the Property Trustee without the consent of the
holders of the Capital Securities, (i) to cure any ambiguity,
correct or supplement any provisions in the Declaration that may
be inconsistent with any other provision, or to make any other
provisions with respect to matters or questions arising under the
Declaration that shall not be inconsistent with the other
provisions of the Declaration or (ii) to modify, eliminate or add
to any
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provisions of the Declaration to such extent as shall be
necessary to ensure that the Trust will be classified as a
grantor trust for United States federal income tax purposes at
all times that any Capital Securities and Common Securities are
outstanding or to ensure that the Trust will not be required to
register as an "investment company" under the Investment Company
Act; provided, however, that such action shall not adversely
affect in any material respect the interests of any holder of
Capital Securities or Common Securities, and any amendments of
the Declaration shall become effective when notice thereof is
given to the holders of Capital Securities and Common Securities.
The Declaration may be amended by the Company and a majority of
the Administrators with (i) the consent of holders representing
not less than a majority (based upon liquidation amounts) of the
outstanding Capital Securities and Common Securities and (ii)
receipt by the Administrators of an opinion of counsel to the
effect that such amendment or the exercise of any power granted
to the Administrators in accordance with such amendment will not
affect the Trust's status as a grantor trust for United States
federal income tax purposes or the Trust's exemption from status
as an "investment company" under the Investment Company Act,
provided, further that without the consent of each holder of
Capital Securities and Common Securities affected thereby, the
Declaration may not be amended to (i) change the amount or timing
of any Distribution on the Capital Securities and Common
Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Capital
Securities and Common Securities as of a specified date or (ii)
restrict the right of a holder of Capital Securities or Common
Securities to institute suit for the enforcement of any such
payment on or after such date.
Any required approval of holders of Capital Securities may
be given at a meeting of holders of Capital Securities convened
for such purpose or pursuant to written consent. The
Administrators will cause a notice of any meeting at which
holders of Capital Securities are entitled to vote, or of any
matter upon which action by written consent of such holders is to
be taken, to be given to each holder of record of Capital
Securities in the manner set forth in the Declaration.
No vote or consent of the holders of Capital Securities
will be required for the Trust to redeem and cancel its Capital
Securities in accordance with the Declaration.
Notwithstanding that holders of Capital Securities are
entitled to vote or consent under any of the circumstances
described above, any of the Capital Securities that are owned by
the Company, the Trustees or any affiliate of the Company or any
Trustees, shall, for purposes of such vote or consent, be treated
as if they were not outstanding.
Expenses and Taxes
In the Indenture, the Company, as borrower, has agreed to
pay all debts and other obligations (other than with respect to
the Capital Securities) and all costs and expenses of the Trust
(including costs and expenses relating to the organization of the
Trust, the fees and expenses of the Trustees and the costs and
expenses relating to the operation of the Trust) and to pay any
and all taxes and all costs and expenses with respect thereto
(other than United States withholding taxes) to which the Trust
might become subject. The foregoing obligations of the Company
under the Indenture are for the benefit of, and shall be
enforceable by, any person to whom any such debts, obligations,
costs, expenses and taxes are owed (a "Creditor") whether or not
such Creditor has received notice thereof. Any such Creditor may
enforce such obligations of the Company directly against the
Company, and the Company has irrevocably waived any right or
remedy to require that any such Creditor take any action against
the Trust or any other person before proceeding against the
Company. The Company has also agreed in the Indenture to execute
such additional agreements as may be necessary or desirable to
give full effect to the foregoing.
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Registrar and Transfer Agent
The Bank of New York will act as registrar and transfer
agent for the Capital Securities.
Registration of transfers of Capital Securities will be
effected without charge by or on behalf of the Trust, but upon
payment of any tax or other governmental charges that may be
imposed in connection with any transfer or exchange. The Trust
will not be required (i) to register or cause to be registered
the transfer or exchange of the Capital Securities during a
period beginning at the opening of business 15 days before the
day of the mailing of the relevant notice of redemption and
ending at the close of business on the day of mailing of such
notice of redemption or (ii) to register or cause to be
registered the transfer or exchange of any Capital Securities so
selected for redemption, except in the case of any Capital
Securities being redeemed in part, any portion thereof not to be
redeemed.
Information Concerning the Property Trustee
The Property Trustee, other than during the occurrence and
continuance of a Trust Enforcement Event, undertakes to perform
only such duties as are specifically set forth in the Declaration
and, after such Trust Enforcement Event, must exercise the same
degree of care and skill as a prudent person would exercise or
use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to
exercise any of the powers vested in it by the Declaration at the
request of any holder of Capital Securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities
that might be incurred thereby. If no Trust Enforcement Event has
occurred and is continuing and the Property Trustee is required
to decide between alternative causes of action, is required to
construe ambiguous provisions in the Declaration or is unsure of
the application of any provision of the Declaration, and the
matter is not one on which holders of Capital Securities are
entitled under the Declaration to vote, then the Property Trustee
may, but shall be under no duty to, take such action as is
directed by the Company and, if not so directed, shall take such
action as it deems advisable and in the best interests of the
holders of the Capital Securities and the Common Securities and
will have no liability except for its own bad faith, negligence
or willful misconduct.
Payment and Paying Agency
Payments in respect of the Global Capital Securities (as
defined herein) shall be made to DTC, which shall credit the
relevant accounts at DTC on the applicable Distribution Dates or,
if the Capital Securities are held in certificated form, such
payments shall be made by check mailed to the address of the
holder entitled thereto as such address shall appear on the
register maintained by the registrar. The paying agent (the
"Paying Agent") shall initially be the Property Trustee and any
co-paying agent chosen by the Property Trustee and acceptable to
the Administrators and the Company. The Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice
to the Property Trustee and the Company. In the event that the
Property Trustee shall no longer be the Paying Agent, the
Administrators shall appoint a successor (which shall be a bank
or trust company acceptable to the Administrators and the
Company) to act as Paying Agent.
Mergers, Consolidations, Amalgamations or Replacements of the Trust
The Trust may not merge with or into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its
properties and assets substantially as an entirety to any
corporation or other Person, except as described below or as
otherwise described in "Liquidation Distribution Upon
Dissolution." The
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Trust may, at the request of the Company, and without the consent
of the holders of the Capital Securities, the Delaware Trustee or
the Property Trustee, merge with or into, consolidate,
amalgamate, be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided that (i)
such successor entity (if not the Trust) either (a) expressly
assumes all of the obligations of the Trust with respect to the
Trust Securities or (b) substitutes for the Capital Securities
other securities having substantially the same terms as the
Capital Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Capital Securities in
priority with respect to distributions and payments upon
liquidation, redemption and otherwise, (ii) if the Trust is not
the successor entity, the Company expressly appoints a trustee of
such successor entity possessing the same powers and duties as
the Property Trustee as the holder of the Junior Subordinated
Debentures, (iii) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause the
Capital Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating
organization, (iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the holders of
the Capital Securities (including any Successor Securities) in
any material respect, (v) such successor entity has a purpose
substantially identical to that of the Trust, (vi) prior to such
merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease, the Company has received an opinion from
independent counsel to the Trust experienced in such matters to
the effect that (a) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the holders of
the Capital Securities (including any Successor Securities) in
any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or
lease, (1) neither the Trust nor such successor entity will be
required to register as an investment company under the
Investment Company Act and (2) the Trust or such successor entity
will continue to be classified as a grantor trust for United
States federal income tax purposes, (vii) the Company or any
permitted successor or assignee owns all of the common securities
of such successor entity and guarantees the obligations of such
successor entity under the Successor Securities at least to the
extent provided by the Guarantee, and (viii) such successor
entity (if not the Trust) expressly assumes all of the
obligations of the Trust with respect to the Trustees.
Notwithstanding the foregoing, the Trust shall not, except with
the consent of holders of 100% in aggregate liquidation amount of
the Trust Securities, consolidate, amalgamate, merge with or
into, be replaced by or convey, transfer or lease its properties
and assets substantially as an entirety to any other entity or
permit any other entity to consolidate, amalgamate, merge with or
into, or replace it if such consolidation, amalgamation, merger,
replacement, conveyance, transfer or lease would cause the Trust
or the successor entity to be classified as other than a grantor
trust for United States federal income tax purposes and each
holder of Trust Securities not to be treated as owning an
undivided interest in the Junior Subordinated Debentures.
Merger or Consolidation of Trustees
Any entity into which the Property Trustee or the Delaware
Trustee may be merged or converted or with which it may be
consolidated, or any entity resulting from any merger, conversion
or consolidation to which such Trustee shall be a party, or any
entity succeeding to all or substantially all the corporate trust
business of such Trustee, shall be the successor of such Trustee
under the Declaration, provided such entity shall be otherwise
qualified and eligible.
Miscellaneous
The Administrators, the Property Trustee and the holders of
a majority of the Common Securities are authorized and directed
to conduct the affairs of and to operate the Trust in such a way
that the Trust
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will not be deemed to be an "investment company" required to be
registered under the Investment Company Act or classified as
other than a grantor trust for United States federal income tax
purposes and so that the Junior Subordinated Debentures will be
treated as indebtedness of the Company for United States federal
income tax purposes. In this connection, the Company is
authorized to take any action, not inconsistent with applicable
law, the Certificate of Trust or the Declaration, that the
Company determines in its discretion to be necessary or desirable
for such purposes, as long as such action does not materially
adversely affect the interests of the holders of the Capital
Securities.
The Trust may not borrow money, issue debt, or mortgage or
pledge any of its assets.
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Old Junior Subordinated Debentures were issued, and the
New Junior Subordinated Debentures will be issued, as a separate
series under a Junior Subordinated Indenture (the "Indenture")
between the Company and The Bank of New York, as trustee (the
"Indenture Trustee"). The Indenture has been qualified under the
Trust Indenture Act. This summary of certain terms and provisions
of the Junior Subordinated Debentures and the Indenture does not
purport to be complete and is subject to, and is qualified in its
entirety by reference to, the Indenture.
General
Concurrently with the issuance of the Old Capital
Securities, the Trust invested the proceeds thereof and the
consideration paid by the Company for the Common Securities in
the Old Junior Subordinated Debentures issued by the Company. The
Junior Subordinated Debentures are in a principal amount equal to
the aggregate liquidation amount of the Capital Securities plus
the Company's concurrent investment in the Common Securities. The
Junior Subordinated Debentures bear interest at the annual rate
of 9.10% of the principal amount thereof, payable semi-annually
in arrears on the 1st day of June and December of each year
(each, an "Interest Payment Date"), commencing December 1, 1997,
to the person in whose name each Junior Subordinated Debenture is
registered, subject to certain exceptions, at the close of
business on the 15th day of the month preceding the relevant
Interest Payment Date. It is anticipated that, until the
liquidation, if any, of the Trust, each Junior Subordinated
Debenture will be held in the name of the Property Trustee in
trust for the benefit of the holders of the Capital Securities
and the Common Securities. The amount of interest payable for any
period will be computed on the basis of a 360-day year of twelve
30-day months. In the event that any date on which interest is
payable on the Junior Subordinated Debentures is not a Business
Day, then payment of the interest payable on such date will be
made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such
delay), with the same force and effect as if made on the date
such payment was originally payable. Accrued interest that is not
paid on the applicable Interest Payment Date will bear additional
interest on the amount thereof (to the extent permitted by law)
at the rate per annum of 9.10% thereof, compounded semi-annually.
The term "interest" as used herein shall include semi-annual
interest payments and interest on semi-annual interest payments
not paid on the applicable Interest Payment Date, as applicable.
The Junior Subordinated Debentures will mature on June 1,
2027 (the "Stated Maturity").
The Junior Subordinated Debentures are unsecured and rank
junior and subordinate in right of payment to all Indebtedness
(as defined below) of the Company. The Indenture does not limit
the incurrence or issuance of other secured or unsecured debt of
the Company, whether under the Indenture
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or any existing or other indenture that the Company may
enter into in the future or otherwise. See "-- Subordination."
The general provisions of the Indenture do not afford
holders of the Junior Subordinated Debentures protection in the
event of a highly leveraged or other transaction involving the
Company that may adversely affect holders of the Junior
Subordinated Debentures.
Option to Extend Interest Payment Period
So long as no Indenture Event of Default has occurred and
is continuing, the Company has the right under the Indenture to
defer the payment of interest at any time or from time to time
for a period not exceeding 10 consecutive semi-annual periods
with respect to each Extension Period, provided that no Extension
Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. At the end of such Extension Period, the
Company must pay all interest then accrued and unpaid (together
with interest thereon at the annual rate of 9.10%, compounded
semi-annually, to the extent permitted by applicable law). During
an Extension Period, stated interest will continue to accrue and
holders of Junior Subordinated Debentures (or holders of Capital
Securities while the Capital Securities are outstanding) will be
required to include such stated interest in income (as OID) for
United States federal income tax purposes. See "Certain United
States Federal Income Tax Consequences -- Interest Income and
Original Issue Discount."
During any such Extension Period, the Company may not, and
may not permit any subsidiary of the Company to, (i) declare or
pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of
the Company's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase
or redeem any debt securities of the Company that rank pari passu
with or junior in interest to the Junior Subordinated Debentures
or make any guarantee payments with respect to any guarantee by
the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu with or junior in
interest to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of
capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or
consultants, or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange
or conversion of any class or series of the Company's capital
stock (or any capital stock of a subsidiary of the Company) for
any class or series of the Company's capital stock or of any
class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) the purchase of
fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any stockholder's
rights plans, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on
which the dividend is being paid (or ranks pari passu with or
junior to such stock). Prior to the termination of any such
Extension Period, the Company may further extend the Extension
Period, provided that no Extension Period may exceed 10
consecutive semi-annual periods or extend beyond the Stated
Maturity of the Junior Subordinated Debentures. Upon the
termination of any such Extension Period and the payment of all
amounts then due on any Interest Payment Date, the Company may
elect to begin a new Extension Period subject to the above
requirements. No interest shall be due and payable during an
Extension Period, except at the end thereof. The Company must
give the Property Trustee, the Administrators and the Indenture
Trustee notice of its election of such Extension Period not less
than one
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Business Day prior to such record date. The Property Trustee
shall give notice of the Company's election to begin a new
Extension Period to the holders of the Capital Securities.
Redemption
The Junior Subordinated Debentures are not redeemable prior
to June 1, 2007 unless a Special Event has occurred. The Junior
Subordinated Debentures are redeemable prior to maturity at the
option of the Company, subject to the receipt of any necessary
prior approval of the Federal Reserve, on or after June 1, 2007,
in whole or in part at any time at the redemption prices
(expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest, if any, to the date of
redemption, if redeemed during the twelve-month period beginning
on June 1 of the years indicated below:
Year Percentage
2007 104.4790%
2008 104.0311%
2009 103.5832%
2010 103.1353%
2011 102.6874%
2012 102.2395%
2013 101.7916%
2014 101.3437%
2015 100.8958%
2016 100.4479%
On or after June 1, 2017, the redemption price will be
100%, plus accrued and unpaid interest, if any, to the date of
redemption.
The Junior Subordinated Debentures are also redeemable at
any time in whole (but not in part), within 90 days of the
occurrence of a Special Event, at a redemption price (the
"Special Event Prepayment Price") equal to the greater of (i)
100% of the principal amount of such Junior Subordinated
Debentures or (ii) as determined by a Quotation Agent (as defined
below), the sum of the present values of the principal amount and
premium payable with respect to an optional redemption of such
Junior Subordinated Debentures on June 1, 2007, together with
scheduled payments of interest from the prepayment date to June
1, 2007 (the "Remaining Life") discounted to the prepayment date
on a semi-annual basis (assuming a 360-day year consisting of
30-day months) at the Adjusted Treasury Rate, plus, in each case,
accrued interest thereon to the date of prepayment.
"Adjusted Treasury Rate" means, with respect to any
prepayment date, the Treasury Rate plus (i) 1.50% if such
prepayment date occurs on or before June 1, 1998 or (ii) 0.50% if
such prepayment date occurs after June 1, 1998.
"Treasury Rate" means (i) the yield, under the heading
which represents the average for the immediately prior week,
appearing in the most recently published statistical release
designated "H.15(519)" or any successor publication which is
published weekly by the Federal Reserve and which establishes
yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury
Constant Maturities," for the maturity corresponding to the
Remaining Life (if no maturity is within three months before or
after the Remaining Life, yields for the two published
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maturities most closely corresponding to the Remaining Life shall
be determined and the Treasury Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding
to the nearest month) or (ii) if such release (or any successor
release) is not published during the week preceding the
calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of
the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its
principal amount) equal to the Comparable Treasury Price for such
prepayment date. The Treasury Rate shall be calculated on the
third business day preceding the prepayment date.
"Comparable Treasury Issue" means with respect to any
prepayment date the United States Treasury security selected by
the Quotation Agent as having a maturity comparable to the
Remaining Life that would be utilized, at the time of selection
and in accordance with customary financial practice, in pricing
new issues of corporate debt securities of comparable maturity to
the Remaining Life. If no United States treasury security has a
maturity which is within a period from three months before to
three months after June 1, 2007, the two most closely
corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be
interpolated or extrapolated on a straight-line basis, rounding
to the nearest month using such securities.
"Quotation Agent" means (i) Lehman Brothers Inc. and its
successors; provided, however, that if the foregoing shall cease
to be a primary U.S. Government securities dealer in New York
City (a "Primary Treasury Dealer"), the Company shall substitute
therefor another Primary Treasury Dealer; and (ii) any other
Primary Treasury Dealer selected by the Indenture Trustee after
consultation with the Company.
"Comparable Treasury Price" means (A) the average of five
Reference Treasury Dealer Quotations for such prepayment date,
after excluding the highest and lowest such Reference Treasury
Dealer Quotations, or (B) if the Indenture Trustee obtains fewer
than three such Reference Treasury Dealer Quotations, the average
of all such Quotations.
"Reference Treasury Dealer Quotations" means, with respect
to each Reference Treasury Dealer and any prepayment date, the
average, as determined by the Company, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case
as a percentage of its principal amount) quoted in writing to the
Indenture Trustee by such Reference Treasury Dealer at 5:00 p.m.
New York City time, on the third business day preceding such
prepayment date.
If the Junior Subordinated Debentures are redeemed, the
Trust must redeem Trust Securities having an aggregate
liquidation amount equal to the aggregate principal amount of
Junior Subordinated Debentures so redeemed. See "Description of
Capital Securities -- Mandatory Redemption."
Notice of any redemption will be mailed at least 30 days
but not more than 60 days before the redemption date to each
holder of Junior Subordinated Debentures to be redeemed at its
registered address. Unless the Company defaults in payment of the
redemption price, on and after the redemption date interest
ceases to accrue on such Junior Subordinated Debentures or
portions thereof called for redemption.
Certain Covenants of the Company
The Company covenants in the Indenture that if and so long
as the Trust is the holder of all Junior Subordinated Debentures,
the Company, as borrower, will pay to the Trust all fees and
expenses
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related to the Trust and the offering of the Capital Securities
and will pay, directly or indirectly, all ongoing costs, expenses
and liabilities of the Trust (including any taxes, duties,
assessments or governmental charges of whatever nature (other
than withholding taxes) imposed by the United States or any
domestic taxing authority upon the Trust but excluding
obligations under the Capital Securities).
The Company also covenants that it will not, and will not
permit any subsidiary of the Company to, (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or
make a liquidation payment with respect to, any of the Company's
capital stock or (ii) make any payment of principal, interest or
premium, if any, on or repay or repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in
interest to the Junior Subordinated Debentures or make any
guarantee payments with respect to any guarantee by the Company
of the debt securities of any subsidiary of the Company if such
guarantee ranks pari passu with or junior in interest to the
Junior Subordinated Debentures (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of
the Company in connection with any employment contract, benefit
plan or other similar arrangement with or for the benefit of any
one or more employees, officers, directors or consultants, or in
connection with a dividend reinvestment or stockholder stock
purchase plan, (b) as a result of an exchange or conversion of
any class or series of the Company's capital stock (or any
capital stock of a subsidiary of the Company) for any class or
series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the
Company's capital stock, (c) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a
dividend in connection with any stockholder's rights plans, or
the issuance of rights, stock or other property under any
stockholder's rights plan, or the redemption or repurchase of
rights pursuant thereto, or (e) any dividend in the form of
stock, warrants, options or other rights where the dividend stock
or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is
being paid (or ranks pari passu with or junior to such stock) if
at such time (x) there shall have occurred any event of which the
Company has actual knowledge that (I) with the giving of notice
or the lapse of time, or both, would constitute an Indenture
Event of Default with respect to Junior Subordinated Debentures
and (II) in respect of which the Company shall not have taken
reasonable steps to cure, (y) the Company shall be in default
with respect to its payment of any obligations under the
Guarantee or (z) the Company shall have given notice of its
election of an Extension Period as provided in the Indenture and
shall not have rescinded such notice, or such Extension Period,
or any extension thereof, shall be continuing. The Indenture does
not contain provisions that afford holders of the Junior
Subordinated Debentures protection in the event of a highly
leveraged transaction or other similar transaction involving the
Company that may adversely affect such holders.
Subordination
In the Indenture, the Company has covenanted and agreed
that any Junior Subordinated Debentures issued thereunder will be
subordinated and junior in right of payment to all Indebtedness
to the extent provided in the Indenture. Upon any payment or
distribution of assets of the Company upon any liquidation,
dissolution, winding-up, reorganization, assignment for the
benefit of creditors, marshaling of assets or any bankruptcy,
insolvency, debt restructuring or similar proceedings in
connection with any insolvency or bankruptcy proceeding of the
Company, the holders of Indebtedness will first be entitled to
receive payment in full of principal of and premium, if any, and
interest, if any, on such Indebtedness before the holders of
Junior Subordinated Debentures or the Property Trustee on behalf
of the holders of Capital Securities will be entitled to receive
or retain any payment in respect of the principal of and premium,
if any, or interest, if any, on the Junior Subordinated
Debentures;
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provided, however, that holders of Indebtedness shall not be
entitled to receive payment of any such amounts to the extent
that such holders would be required by the subordination
provisions of such Indebtedness to pay such amounts over to the
obligees on trade accounts payable or other liabilities arising
in the ordinary course of the Company's business.
In the event of the acceleration of the maturity of any
Junior Subordinated Debentures, the holders of all Indebtedness
outstanding at the time of such acceleration will first be
entitled to receive payment in full of all amounts then due
thereon (including any amounts due upon acceleration) before the
holders of Junior Subordinated Debentures will be entitled to
receive or retain any payment in respect of the principal of and
premium, if any, or interest, if any, on the Junior Subordinated
Debentures; provided, however, that holders of Indebtedness shall
not be entitled to receive payment of any such amounts to the
extent that such holders would be required by the subordination
provisions of such Indebtedness to pay such amounts over to the
obligees on trade accounts payable or other liabilities arising
in the ordinary course of the Company's business.
No payments on account of principal (or premium, if any) or
interest, if any, in respect of the Junior Subordinated
Debentures may be made if there shall have occurred and be
continuing a default in any payment with respect to Indebtedness,
or an event of default with respect to any Indebtedness resulting
in the acceleration of the maturity thereof, or if any judicial
proceeding shall be pending with respect to any such default.
"Indebtedness" means with respect to any person, whether
recourse is to all or a portion of the assets of such person and
whether or not contingent, (i) every obligation of such person
for money borrowed; (ii) every obligation of such person
evidenced by bonds, debentures, notes or other similar
instruments, including obligations incurred in connection with
the acquisition of property, assets or businesses; (iii) every
reimbursement obligation of such person with respect to letters
of credit, bankers' acceptances or similar facilities issued for
the account of such person; (iv) every obligation of such person
issued or assumed as the deferred purchase price of property or
services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business); (v)
every capital lease obligation of such person; (vi) every
obligation of such person for claims (as defined in Section
101(4) of the United States Bankruptcy Code of 1978, as amended)
in respect of derivative products such as interest and foreign
exchange rate contracts, commodity contracts and similar
arrangements; and (vii) every obligation of the type referred to
in clauses (i) through (vi) of another person and all dividends
of another person the payment of which, in either case, such
person has guaranteed or is responsible or liable, directly or
indirectly, as obligor or otherwise; provided that "Indebtedness"
shall not include (i) any obligations which, by their terms, are
expressly stated to rank pari passu in right of payment with, or
to not be superior in right of payment to, the Junior
Subordinated Debentures, (ii) any Indebtedness of the Company
which when incurred and without respect to any election under
Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Company, (iii) any
Indebtedness of the Company to any of its subsidiaries, (iv)
Indebtedness to any employee of the Company, or (v) any
indebtedness of the Company in respect of debt securities issued
to any trust, or a trustee of such trust, partnership or other
entity affiliated with the Company that is a financing entity of
the Company in connection with the issuance by such financing
entity of securities that are similar to the Capital Securities.
The Indenture places no limitation on the amount of
additional Indebtedness that may be incurred by the Company or
any indebtedness or other liabilities that may be incurred by the
Company's subsidiaries. As of June 30, 1997, Indebtedness of the
Company aggregated approximately $236 million,
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and the Company's subsidiaries had indebtedness and other
liabilities of approximately $507 million to which the Junior
Subordinated Debentures would be effectively subordinated.
Indenture Events of Default
The Indenture provides that any one or more of the following
described events with respect to the Junior Subordinated
Debentures that has occurred and is continuing constitutes an
"Indenture Event of Default" with respect to the Junior
Subordinated Debentures:
(i) failure for 30 days to pay any interest on the Junior
Subordinated Debentures when due (subject to the deferral of any
due date in the case of an Extension Period); or
(ii) failure to pay any principal on the Junior Subordinated
Debentures when due whether at maturity, upon redemption by
declaration or otherwise; or
(iii) failure to observe or perform in any material respect
any other covenant contained in the Indenture for 90 days after
written notice to the Company from the Indenture Trustee or the
holders of at least 25% in aggregate outstanding principal amount
of Junior Subordinated Debentures; or
(iv) certain events in bankruptcy, insolvency or reorganization
of the Company.
The holders of a majority in aggregate outstanding
principal amount of Junior Subordinated Debentures have the right
to direct the time, method and place of conducting any proceeding
for any remedy available to the Indenture Trustee. The Indenture
Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of Junior Subordinated Debentures
may declare the principal due and payable immediately upon an
Indenture Event of Default, and, should the Indenture Trustee or
such holders of such Junior Subordinated Debentures fail to make
such declaration, the holders of at least 25% in aggregate
liquidation amount of the Capital Securities shall have such
right. The holders of a majority in aggregate outstanding
principal amount of Junior Subordinated Debentures may annul such
declaration and waive the default if the default (other than the
non-payment of the principal of Junior Subordinated Debentures
which has become due solely by such acceleration) has been cured
and a sum sufficient to pay all matured installments of interest
and principal due otherwise than by acceleration has been
deposited with the Indenture Trustee, and should the holders of
such Junior Subordinated Debentures fail to annul such
declaration and waive such default, the holders of a majority in
aggregate liquidation amount of the Capital Securities shall have
such right.
The holders of a majority in aggregate outstanding
principal amount of the Junior Subordinated Debentures affected
thereby may, on behalf of the holders of all the Junior
Subordinated Debentures, waive any past default, except a default
in the payment of principal or interest (unless such default has
been cured and a sum sufficient to pay all matured installments
of interest and principal due otherwise
than by acceleration has been deposited with the Indenture
Trustee) or a default in respect of a covenant or provision which
under the Indenture cannot be modified or amended without the
consent of the holder of each outstanding Junior Subordinated
Debenture, and should the holders of such Junior Subordinated
Debentures fail to waive such default, the holders of a majority
in aggregate liquidation amount of the Capital Securities shall
have such right. The Company is required to file annually with
the Indenture Trustee a certificate as to whether or not the
Company is in compliance with all the conditions and covenants
applicable to it under the Indenture.
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In case an Indenture Event of Default shall occur and be
continuing, the Property Trustee will have the right to declare
the principal of and the interest on such Junior Subordinated
Debentures and any other amounts payable under the Indenture to
be forthwith due and payable and to enforce its other rights as a
creditor with respect to such Junior Subordinated Debentures.
Enforcement of Certain Rights by Holders of Capital Securities
If an Indenture Event of Default has occurred and is
continuing and such event is attributable to the failure of the
Company to pay interest or principal on the Junior Subordinated
Debentures on the date such interest or principal is otherwise
payable, a holder of Capital Securities may institute a Direct
Action for payment. The Company may not amend the Indenture to
remove the foregoing right to bring a Direct Action without the
prior written consent of the holders of all of the Capital
Securities. Notwithstanding any payment made to such holder of
Capital Securities by the Company in connection with a Direct
Action, the Company shall remain obligated to pay the principal
of or interest on the Junior Subordinated Debentures held by the
Trust or the Property Trustee and the Company shall be subrogated
to the rights of the holder of such Capital Securities with
respect to payments on the Capital Securities to the extent of
any payments made by the Company to such holder in any Direct
Action. The holders of Capital Securities will not be able to
exercise directly any other remedy available to the holders of
the Junior Subordinated Debentures.
Consolidation, Merger, Sale of Assets and Other Transactions
The Indenture provides that the Company shall not consolidate
with or merge into any other Person or convey, transfer or lease
its properties and assets substantially as an entirety to any
Person, unless (i) in case the Company consolidates with or
merges into another Person or conveys, transfers or leases its
properties and assets substantially as an entirety to any Person,
the successor Person is organized under the laws of the United
States or any state or the District of Columbia, and such
successor Person expressly assumes the Company's obligations on
the Junior Subordinated Debentures issued under the Indenture;
(ii) immediately after giving effect thereto, no Indenture Event
of Default, and no event which, after notice or lapse of time or
both, would become an Indenture Event of Default, shall have
happened and be continuing; (iii) if at the time any Capital
Securities are outstanding, such transaction is permitted under
the Declaration and Guarantee and does not give rise to any
breach or violation of the Declaration or Guarantee; (iv) any
such lease shall provide that it will remain in effect so long as
any Junior Subordinated Debentures are outstanding; and (v)
certain other conditions as prescribed in the Indenture are met.
Modification of Indenture
From time to time the Company and the Indenture Trustee
may, without the consent of the holders of the Junior
Subordinated Debentures, amend, waive or supplement the Indenture
for specified purposes, including, among other things, curing
ambiguities, defects or inconsistencies (provided that any such
action does not materially adversely affect the interest of the
holders of Junior Subordinated Debentures) and qualifying, or
maintaining the qualification of, the Indenture under the Trust
Indenture Act and to add to, delete from or revise the terms of
the Junior Subordinated Debentures to provide for transfer
procedures and restrictions substantially similar to those
applicable to the Capital Securities (for purposes of assuring
that no registration of the Junior Subordinated Debentures is
required under the Securities Act). The Indenture contains
provisions permitting the Company and the Indenture Trustee, with
the consent of the holders of not less than a majority in
principal amount of outstanding Junior Subordinated Debentures
affected, to modify the Indenture in a manner affecting the
rights of the holders
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of such Junior Subordinated Debentures; provided that no such
modification may, without the consent of the holder of each
outstanding Junior Subordinated Debenture so affected, (i) change
the stated maturity of Junior Subordinated Debentures, or reduce
the principal amount thereof, or reduce the rate or extend the
time of payment of interest thereon (except such extension as is
contemplated hereby) or (ii) reduce the percentage of principal
amount of Junior Subordinated Debentures the holders of which are
required to consent to any such modification of the Indenture,
provided that, so long as any Capital Securities remain
outstanding, no such modification may be made that adversely
affects the holders of such Capital Securities in any material
respect, and no termination of the Indenture may occur, and no
waiver of any Indenture Event of Default or compliance with any
covenant under the Indenture may be effective, without the prior
consent of the holders of at least a majority of the aggregate
liquidation amount of the outstanding Capital Securities unless
and until the principal of the Junior Subordinated Debentures and
all accrued and unpaid interest thereon have been paid in full
and certain other conditions are satisfied.
Defeasance and Discharge
The Indenture provides that the Company, at the Company's
option: (a) will be discharged from any and all obligations in
respect of the Junior Subordinated Debentures (except for certain
obligations to register the transfer or exchange of Junior
Subordinated Debentures, replace stolen, lost or mutilated Junior
Subordinated Debentures, maintain paying agencies and hold moneys
for payment in trust) or (b) need not comply with certain
restrictive covenants of the Indenture (including that described
in the second paragraph under "-- Certain Covenants of the
Company"), in each case if the Company deposits, in trust with
the Indenture Trustee, money or U.S. Government Obligations which
through the payment of interest thereon and principal thereof in
accordance with their terms will provide money, in an amount
sufficient to pay all the principal of, and interest and premium,
if any, on the Junior Subordinated Debentures on the dates such
payments are due in accordance with the terms of such Junior
Subordinated Debentures. To exercise any such option, the Company
is required to deliver to the Indenture Trustee an opinion of
counsel to the effect that the deposit and related defeasance
would not cause the holders of the Junior Subordinated Debentures
to recognize income, gain or loss for United States federal
income tax purposes and, in the case of a discharge pursuant to
clause (a), such opinion shall be accompanied by a private letter
ruling to that effect received by the Company from the United
States Internal Revenue Service or revenue ruling pertaining to a
comparable form of transaction to such effect published by the
United States Internal Revenue Service.
Distributions of Junior Subordinated Debentures; Book-Entry Issuance
Under certain circumstances involving the termination of
the Trust, Junior Subordinated Debentures may be distributed to
the holders of the Capital Securities in liquidation of the Trust
after satisfaction of liabilities to creditors of the Trust as
provided by applicable law. If distributed to holders of Capital
Securities in liquidation, the Junior Subordinated Debentures
will initially be issued in the
form of global securities and certificated securities. DTC, or
any successor depositary, will act as depositary for such global
securities. It is anticipated that the depositary arrangements
for such global securities would be substantially identical to
those in effect for the Capital Securities. For a description of
global securities and certificated securities, see "Book-Entry
Issuance."
There can be no assurance as to the market price of any
Junior Subordinated Debentures that may be distributed to the
holders of Capital Securities.
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Payment and Paying Agents
The Company initially will act as Paying Agent with respect
to the Junior Subordinated Debentures except that, if the Junior
Subordinated Debentures are distributed to the holders of the
Capital Securities in liquidation of such holders' interests in
the Trust, the Indenture Trustee will act as the Paying Agent.
The Company at any time may designate additional Paying Agents or
rescind the designation of any Paying Agent or approve a change
in the office through which any Paying Agent acts, except that
the Company will be required to maintain a Paying Agent at the
place of payment.
Any moneys deposited with the Indenture Trustee or any
Paying Agent, or then held by the Company in trust, for the
payment of the principal of and premium, if any, or interest on
any Junior Subordinated Debentures and remaining unclaimed for
two years after such principal and premium, if any, or interest
has become due and payable shall, at the request of the Company,
be repaid to the Company, and the holder of such Junior
Subordinated Debentures shall thereafter look, as a general
unsecured creditor, only to the Company for payment thereof.
Governing Law
The Indenture and the Junior Subordinated Debentures are
governed by and will be construed in accordance with the laws of
the State of New York.
Information Concerning the Indenture Trustee
The Indenture Trustee is, and is subject to all the duties
and responsibilities specified with respect to, an indenture
trustee under the Trust Indenture Act. Subject to such
provisions, the Indenture Trustee is under no obligation to
exercise any of the powers vested in it by the Indenture at the
request of any holder of Junior Subordinated Debentures, unless
offered reasonable indemnity by such holder against the costs,
expenses and liabilities which might be incurred thereby. The
Indenture Trustee is not required to expend or risk its own funds
or otherwise incur personal financial liability in the
performance of its duties if the Indenture Trustee reasonably
believes that repayment or adequate indemnity is not reasonably
assured to it.
DESCRIPTION OF GUARANTEE
The Old Guarantee was executed and delivered by the Company
concurrently with the issuance by the Trust of the Trust
Securities for the benefit of the holders from time to time of
such Trust Securities. The Bank of New York acts as indenture
trustee ("Guarantee Trustee") under the Guarantee. As soon as
practicable after the date hereof, the Company will exchange the
Old Guarantee for the New Guarantee with respect to the Capital
Securities. The New Guarantee has been qualified under the Trust
Indenture Act. This summary of certain provisions of the
Guarantee does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all of the provisions
of the Guarantee, including the definitions therein of certain
terms. The Guarantee Trustee will hold the Guarantee for the
benefit of the holders of the Capital Securities.
General
The Company has irrevocably and unconditionally agreed to
pay in full on a subordinated basis, to the extent set forth
herein, the Guarantee Payments (as defined below) to the holders
of the Capital Securities, as and when due, regardless of any
defense, right of set-off or counterclaim that the Trust may
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have or assert other than the defense of payment. The following
payments with respect to the Capital Securities, to the extent
not paid by or on behalf of the Trust (the "Guarantee Payments"),
are subject to the Guarantee: (i) any accumulated and unpaid
Distributions required to be paid on the Capital Securities, to
the extent that the Trust has sufficient funds available therefor
at the time, (ii) the redemption price with respect to any
Capital Securities called for redemption, to the extent that the
Trust has sufficient funds available therefor at such time, or
(iii) upon a voluntary or involuntary dissolution, winding up or
liquidation of the Trust (unless the Junior Subordinated
Debentures are distributed to holders of the Capital Securities),
the lesser of (a) the aggregate liquidation amount of the Capital
Securities and all accrued and unpaid Distributions thereon to
the date of payment and (b) the amount of assets of the Trust
remaining available for distribution to holders of Capital
Securities. The Company's obligation to make a Guarantee Payment
may be satisfied by direct payment of the required amounts by the
Company to the holders of the applicable Capital Securities or by
causing the Trust to pay such amounts to such holders.
The Guarantee is an irrevocable guarantee on a subordinated
basis of the Trust's obligations under the Capital Securities,
but it applies only to the extent that the Trust has sufficient
funds available to make such payments.
If the Company does not make interest payments on the
Junior Subordinated Debentures held by the Trust, the Trust will
not be able to pay Distributions on the Capital Securities and
will not have funds legally available therefor. The Guarantee
ranks subordinate and junior in right of payment to all general
liabilities of the Company. See "-- Status of the Guarantee." The
Guarantee does not limit the incurrence or issuance of other
secured or unsecured debt of the Company, whether under the
Indenture or any existing or other indenture that the Company may
enter into in the future or otherwise.
The Company has, through the Guarantee, the Junior
Subordinated Debentures and the Indenture, taken together, fully
and unconditionally guaranteed all of the Trust's obligations
under the Capital Securities. No single document standing alone
or operating in conjunction with fewer than all of the other
documents constitutes such guarantee. It is only the combined
operation of these documents that has the effect of providing a
full and unconditional guarantee of the Trust's obligations under
the Capital Securities. See "Relationship Among the Capital
Securities, the Junior Subordinated Debentures and the Guarantee
- -- General."
Status of the Guarantee
The Guarantee constitutes an unsecured obligation of the
Company and ranks subordinate and junior in right of payment to
all Indebtedness of the Company. The Guarantee does not place a
limitation on the amount of additional Indebtedness that may be
incurred by the Company.
The Guarantee constitutes a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal
proceeding directly against the Company to enforce its rights
under the Guarantee without first instituting a legal proceeding
against any other person or entity). The Guarantee will be held
for the benefit of the holders of the Capital Securities. The
Guarantee will not be discharged except by payment of the
Guarantee Payments in full to the extent not paid by the Trust or
upon distribution of the Junior Subordinated Debentures to the
holders of the Capital Securities in exchange for all of the
Capital Securities.
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Amendments and Assignment
Except with respect to any changes that do not materially
adversely affect the rights of holders of the Capital Securities
(in which case no vote will be required), the Guarantee may not
be amended without the prior approval of the holders of not less
than a majority of the aggregate liquidation amount of the
outstanding Capital Securities. The manner of obtaining any such
approval will be as set forth under "Description of Capital
Securities -- Voting Rights; Amendment of the Declaration." All
guarantees and agreements contained in the Guarantee shall bind
the successors, assigns, receivers, trustees and representatives
of the Company and shall inure to the benefit of the registered
holders of the Capital Securities then outstanding.
Events of Default
An event of default under the Guarantee will occur upon the
failure of the Company to perform any of its payment or other
obligations thereunder. The holders of a majority in aggregate
liquidation amount of the Capital Securities have the right to
direct the time, method and place of conducting any proceeding
for any remedy available to the Guarantee Trustee in respect of
the Guarantee or to direct the exercise of any trust or power
conferred upon the Guarantee Trustee under the Guarantee.
Any holder of the Capital Securities may institute a legal
proceeding directly against the Company to enforce its rights
under the Guarantee without first instituting a legal proceeding
against the Trust, the Guarantee Trustee or any other person or
entity.
The Company, as guarantor, is required to file annually
with the Guarantee Trustee a certificate as to whether or not the
Company is in compliance with all the conditions and covenants
applicable to it under the Guarantee.
Information Concerning the Guarantee Trustee
The Guarantee Trustee, other than during the occurrence and
continuance of a default by the Company in performance of the
Guarantee, undertakes to perform only such duties as are
specifically set forth in each Guarantee and, after default with
respect to the Guarantee, must exercise the same degree of care
and skill as a prudent person would exercise or use in the
conduct of his or her own affairs. Subject to this provision, the
Guarantee Trustee is under no obligation to exercise any of the
powers vested in it by the Guarantee at the request of any holder
of any Capital Security unless it is offered reasonable indemnity
against the costs, expenses and liabilities that might be
incurred thereby.
Termination of the Guarantee
The Guarantee will terminate and be of no further force and
effect upon full payment of the redemption price of all of the
Capital Securities, upon full payment of the amounts payable upon
liquidation of the Trust or upon distribution of Junior
Subordinated Debentures to the holders of the Capital Securities
in exchange for all of the Capital Securities. The Guarantee will
continue to be effective or will be reinstated, as the case may
be, if at any time any holder of the Capital Securities must
restore payment of any sums paid under the Capital Securities or
the Guarantee.
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Governing Law
The Guarantee is governed by and will be construed in
accordance with the laws of the State of New York.
RELATIONSHIP AMONG THE CAPITAL SECURITIES,
THE JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
Payments of Distributions and other amounts due on the
Capital Securities (to the extent the Trust has funds available
for the payment of such Distributions) are irrevocably guaranteed
by the Company as and to the extent set forth under "Description
of Guarantee." If and to the extent that the Company does not
make payments under the Junior Subordinated Debentures, the Trust
will not pay Distributions or other amounts due on the Capital
Securities. The Guarantee does not cover payment of Distributions
when the Trust does not have sufficient funds to pay such
Distributions. In such event, a holder of Capital Securities may
institute a legal proceeding directly against the Company under
the Indenture to enforce payment of such Distributions to such
holder after the respective due dates. Taken together, the
Company's obligations under the Junior Subordinated Debentures,
the Indenture and the Guarantee provide, in the aggregate, a full
and unconditional guarantee of payment of distributions and other
amounts due on the Capital Securities. No single document
standing alone or operating in conjunction with fewer than all of
the other documents constitutes such guarantee. It is only the
combined operation of these documents that has the effect of
providing a full and unconditional guarantee of the Trust's
obligations under the Capital Securities. The obligations of the
Company under the Guarantee and the Junior Subordinated
Debentures are subordinate and junior in right of payment to all
Indebtedness of the Company to the extent provided in the
Indenture.
Sufficiency of Payments
As long as payments of interest and other payments are made
when due on the Junior Subordinated Debentures, such payments
will be sufficient to cover Distributions and other payments due
on the Capital Securities, primarily because (i) the aggregate
principal amount of the Junior Subordinated Debentures will be
equal to the sum of the aggregate stated liquidation amount of
the Capital Securities and the Common Securities; (ii) the
interest rate and interest and other payment dates on the Junior
Subordinated Debentures will match the Distribution rate and
Distribution and other payment dates for the related Capital
Securities; (iii) the Company will pay for all and any costs,
expenses and liabilities of the Trust except the Trust's
obligations under the Capital Securities; and (iv) the
Declaration further provides that the Trust will not engage in
any activity that is not consistent with the limited purposes of
the Trust.
Notwithstanding anything to the contrary in the Indenture,
the Company has the right to set-off any payment it is otherwise
required to make thereunder with and to the extent the Company
has theretofore made, or is concurrently on the date of such
payment making, a related payment under the Guarantee.
Enforcement Rights of Holders of Capital Securities
A holder of Capital Securities may institute a legal
proceeding directly against the Company to enforce its rights
under the Guarantee without first instituting a legal proceeding
against the Guarantee Trustee, the Trust or any other person or
entity.
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A default or event of default under any Indebtedness of the
Company will not constitute a default or Indenture Event of
Default. In addition, in the event of payment defaults under, or
acceleration of, Indebtedness of the Company, the subordination
provisions of the Indenture provide that no payments may be made
in respect of the Junior Subordinated Debentures until such
Indebtedness has been paid in full or any payment default
thereunder has been cured or waived. Failure to make required
payments on the Junior Subordinated Debentures would constitute
an Indenture Event of Default under the Indenture.
Limited Purpose of Trust
The Capital Securities evidence a beneficial interest in
the assets of the Trust, and the Trust exists for the sole
purpose of issuing the Capital Securities and the Common
Securities and investing the proceeds thereof in Junior
Subordinated Debentures. A principal difference between the
rights of a holder of Capital Securities and a holder of Junior
Subordinated Debentures is that a holder of Junior Subordinated
Debentures is entitled to receive from the Company the principal
amount of and interest accrued on Junior Subordinated Debentures
held, while a holder of Capital Securities is entitled to receive
Distributions from the Trust (or from the Company under the
Guarantee) if and to the extent the Trust has funds available for
the payment of such Distributions.
Rights Upon Dissolution
Upon any voluntary or involuntary dissolution, winding-up
or liquidation of the Trust involving the liquidation of the
Junior Subordinated Debentures, after satisfaction of liability
to creditors of the Trust as required by applicable law, the
holders of the Capital Securities will be entitled to receive,
out of assets held by the Trust, the liquidation distribution in
cash. See "Description of Capital Securities --Liquidation
Distribution Upon Dissolution." Upon any voluntary or involuntary
liquidation or bankruptcy of the Company, the Property Trustee,
as holder of the Junior Subordinated Debentures, would be a
subordinated creditor of the Company, subordinated in right of
payment to all Indebtedness to the extent provided in the
Indenture, but entitled to receive payment in full of principal
and interest before any stockholders of the Company receive
payments or distributions. Since the Company is the guarantor
under the Guarantee and has agreed to pay for all costs, expenses
and liabilities of the Trust (other than the Trust's obligations
to the holders of the Capital Securities), the positions of a
holder of Capital Securities and a holder of the Junior
Subordinated Debentures relative to other creditors and to
stockholders of the Company in the event of liquidation or
bankruptcy of the Company would be substantially the same.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Cleary, Gottlieb, Steen & Hamilton,
special United States federal income tax counsel to the Company
and the Trust ("Tax Counsel"), the following summary accurately
describes the material United States federal income tax
consequences that may be relevant to the purchase, ownership and
disposition of the Capital Securities. Unless otherwise stated,
this summary deals only with Capital Securities held as capital
assets by United States Holders (defined below) who purchased the
Old Capital Securities upon original issuance at their original
offering price. As used herein, a "United States Holder" means a
person that is a citizen or resident of the United States or a
U.S. domestic corporation or that otherwise will be subject to
United States federal income taxation on a net income basis in
respect of the Capital Securities. The tax treatment of a holder
may vary depending on his, her or its particular situation. This
summary does not address all the tax consequences that may be
relevant to a particular holder or to holders who may be subject
to special tax treatment, such as banks, real estate investment
trusts, regulated investment companies, insurance companies,
dealers in securities or currencies, or tax-
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exempt investors. In addition, this summary does not include any
description of any alternative minimum tax consequences or the
tax laws of any state, local or foreign government that may be
applicable to a holder of Capital Securities. This summary is
based on the Internal Revenue Code of 1986, as amended (the
"Code"), the Treasury regulations promulgated thereunder and
administrative and judicial interpretations thereof, as of the
date hereof, all of which are subject to change, possibly on a
retroactive basis. The authorities on which this summary is based
are subject to various interpretations and the opinions of Tax
Counsel are not binding on the Internal Revenue Service ("IRS")
or the courts, either of which could take a contrary position.
Moreover, no rulings have been or will be sought from the IRS
with respect to the transactions described herein. Accordingly,
there can be no assurance that the IRS will not challenge the
opinions expressed herein or that a court would not sustain such
a challenge. Nevertheless, Tax Counsel has advised that it is of
the view that, if challenged, the opinions expressed herein would
be sustained by a court with jurisdiction in a properly presented
case.
HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT
TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE CAPITAL SECURITIES, INCLUDING THE TAX
CONSEQUENCES UNDER STATE, LOCAL, FOREIGN, AND OTHER TAX LAWS AND
THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES FEDERAL OR OTHER
TAX LAWS.
Exchange of Capital Securities
The exchange of the Old Capital Securities for the New
Capital Securities pursuant to the Exchange Offer will not
constitute a taxable event to United States Holders.
Consequently, (i) no gain or loss will be realized by a United
States Holder upon receipt of a New Capital Security; (ii) the
holding period of the New Capital Security will include the
holding period of the Old Capital Security exchanged
therefor; and (iii) the adjusted tax basis of the New Capital
Security will be the same as the adjusted tax basis of the Old
Capital Security exchanged therefor immediately before the
exchange.
Classification of the Trust
Under current law and assuming full compliance with the
terms of the Declaration, the Trust will be classified as a
grantor trust and not as an association taxable as a corporation
for United States federal income tax purposes. Accordingly, for
United States federal income tax purposes, each beneficial owner
(a "holder") of Capital Securities will be treated as owning an
undivided beneficial interest in the Junior Subordinated
Debentures and, thus, will be required to include in its gross
income its pro rata share of the interest income or original
issue discount that is paid or accrued on the Junior Subordinated
Debentures.
Classification of the Junior Subordinated Debentures
The Company, the Trust and the holders of the Old Capital
Securities (by the acceptance of a beneficial interest in a
Capital Security) have agreed, and the holders of the New Capital
Securities will agree, to treat the Junior Subordinated
Debentures as indebtedness for all United States tax purposes. In
connection with the issuance of the Old Junior Subordinated
Debentures, Tax Counsel has rendered its opinion that, under then
current law, and based on certain representations, facts and
assumptions set forth in such opinion, the Junior Subordinated
Debentures will be classified as indebtedness for United States
federal income tax purposes.
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Interest Income and Original Issue Discount
Under the applicable Treasury regulations and based upon
certain representations, facts and assumptions provided by the
Company, the Junior Subordinated Debentures will not be treated
as issued with "original issue discount" ("OID") within the
meaning of section 1273(a) of the Code. Accordingly, except as
set forth below, stated interest on the Junior Subordinated
Debentures generally will be taxable to a holder as ordinary
income at the time it is paid or accrued in accordance with such
holder's regular method of tax accounting.
If, however, the Company exercises its right to defer
payments of stated interest on the Junior Subordinated
Debentures, the Junior Subordinated Debentures will become OID
instruments at such time and all holders of the Junior
Subordinated Debentures and, consequently, holders of the Capital
Securities will be required to accrue their pro rata share of OID
(which will include both the stated interest and the de minimis
OID, if any, on the Junior Subordinated Debentures) on a daily
economic accrual basis during the Extension Period even though
the Company will not pay such stated interest until the end of
the Extension Period, and even though some holders may use the
cash method of tax accounting. Moreover, thereafter the Junior
Subordinated Debentures will be taxed as OID instruments for as
long as they remain outstanding. Thus, even after the end of an
Extension Period, all holders would be required to continue to
include the stated interest (and de minimis OID, if any) on the
Junior Subordinated Debentures in income on a daily economic
accrual basis, regardless of their method of tax accounting and
in advance of receipt of the cash attributable to such income.
Under the OID economic accrual rules, a holder would accrue an
amount of interest income each year that approximates the stated
interest payments called for under the terms of the Junior
Subordinated Debentures, and actual cash payments of stated
interest on the Junior Subordinated Debentures would not be
reported separately as taxable income. Any amount of OID included
in a holder's gross income (whether or not during an Extension
Period) with respect to a Capital Security will increase such
holder's tax basis in such Capital Security, and the amount of
Distributions received by a holder in respect of such accrued OID
will reduce the tax basis of such Capital Security.
The Treasury regulations described above have not yet been
addressed in any rulings or other interpretations by the IRS, and
it is possible that the IRS could take a contrary position. If
the IRS were to assert successfully that the stated interest on
the Junior Subordinated Debentures was OID regardless of whether
the Company exercises its option to defer payments of interest on
such debentures, all holders of Capital Securities would be
required to include such stated interest in income on a daily
economic accrual basis as described above.
Corporate holders of Capital Securities will not be
entitled to a dividends-received deduction with respect to any
income recognized by such holders with respect to the Capital
Securities.
Distribution of Junior Subordinated Debentures or Cash upon
Liquidation of the Trust
As described under the caption "Description of Junior
Subordinated Debentures -- Distribution of Junior Subordinated
Debentures," Junior Subordinated Debentures may be distributed to
holders in exchange for the Capital Securities and in liquidation
of the Trust. Under current law, such a distribution would be
non-taxable, and will result in the holder receiving directly its
pro rata share of the Junior Subordinated Debentures previously
held indirectly through the Trust, with a holding period and
aggregate tax basis equal to the holding period and aggregate tax
basis such holder had in its Capital Securities before such
distribution. If, however, the liquidation of the Trust were to
occur because the Trust is subject to United States federal
income tax with respect to income accrued or received on the
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Junior Subordinated Debentures, the distribution of the Junior
Subordinated Debentures to holders would be a taxable event to
the Trust and to each holder and a holder would recognize gain or
loss as if the holder had exchanged its Capital Securities for
the Junior Subordinated Debentures it received upon liquidation
of the Trust. A holder would accrue interest in respect of the
Junior Subordinated Debentures received from the Trust in the
manner described above under "-- Interest Income and Original
Issue Discount."
Under certain circumstances described herein (see
"Description of Capital Securities -- Special Event Redemption or
Distribution of Junior Subordinated Debentures"), the Junior
Subordinated Debentures may be redeemed for cash, with the
proceeds of such redemption distributed to holders in redemption
of their Capital Securities. Under current law, such a redemption
would constitute a taxable disposition of the redeemed Capital
Securities for United States federal income tax purposes, and a
holder would recognize gain or loss as if it sold such redeemed
Capital Securities for cash. See "-- Sales of Capital
Securities."
Sales of Capital Securities
A holder that sells Capital Securities will recognize gain
or loss equal to the difference between the amount realized by
such holder on the sale of the Capital Securities (except to the
extent that such amount realized is characterized as a payment in
respect of accrued but unpaid interest on such holder's allocable
share of the Junior Subordinated Debentures that the holder had
not included in gross income previously) and the holder's
adjusted tax basis in the Capital Securities sold. Such gain or
loss generally will be a capital gain or loss and generally will
be taxable as a long-term capital gain or loss if the Capital
Securities have been held for more than one year. The Taxpayer
Relief Act of 1997 generally reduces the tax rates on capital
gains of individuals in respect of capital assets held for more
than 18 months. Holders are advised to consult with their own tax
advisors as to the consequences in their particular circumstances
of the capital gain provisions of the Taxpayer Relief Act of
1997. Subject to certain limited exceptions, capital losses
cannot be applied to offset ordinary income for United States
federal income tax purposes.
Non-United States Holders
As used herein, the term "Non-United States Holder" means a
holder of Capital Securities that is a nonresident alien
individual or a foreign corporation.
As discussed above, the Capital Securities will be treated
as evidence of an indirect beneficial ownership interest in the
Junior Subordinated Debentures. See "-- Classification of the
Trust." Thus, under present United States federal income tax law,
and subject to the discussion below concerning backup
withholding:
(a) no withholding of United States federal income tax will
be required with respect to the payment by the Company or any
paying agent (a "Paying Agent") of principal or interest (which
for purposes of this discussion includes any OID) in respect of
the Capital Securities (or on the Junior Subordinated Debentures)
to a Non-United States Holder, provided that (i) the beneficial
owner of the Capital Securities ("Beneficial Owner") does not
actually or constructively own 10% or more of the total combined
voting power of all classes of stock of the Company entitled to
vote within the meaning of Section 871(h)(3) of the Code and the
regulations thereunder, (ii) the Beneficial Owner is not a
controlled foreign corporation that is related to the Company
through stock ownership and (iii) the
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Beneficial Owner satisfies the statement requirement (described
generally below) set forth in Section 871(h) and Section 881(c)
of the Code and the regulations thereunder; and
(b) no withholding of United States federal income tax will
be required with respect to any gain realized by a Non-United
States Holder upon the sale or other disposition of the Capital
Securities.
To satisfy the requirement referred to in (a)(iii) above,
the Beneficial Owner, or a financial institution holding the
Capital Securities on behalf of such owner, must provide, in
accordance with specified procedures, to the Trust or any Paying
Agent, a statement to the effect that the Beneficial Owner is not
a United States person. Pursuant to current temporary Treasury
regulations, these requirements will be met if (1) the Beneficial
Owner provides his name and address, and certifies, under
penalties of perjury, that it is not a United States person
(which certification may be made on an IRS Form W-8 (or successor
form)) or (2) a financial institution holding the Capital
Securities on behalf of the Beneficial Owner certifies, under
penalties of perjury, that such statement has been received by it
and furnishes the Company or any Paying Agent with a copy
thereof.
If a Non-United States Holder cannot satisfy the
requirements of the "portfolio interest" exception described in
(a) above, payments of interest (including any OID) made to such
Non-United States Holder will be subject to a 30% United States
federal withholding tax unless the Beneficial Owner provides the
Company or its paying agent, as the case may be, with a properly
executed (1) IRS Form 1001 (or successor form) claiming an
exemption from, or a reduction of, such withholding tax under the
benefit of a United States tax treaty or (2) IRS Form 4224 (or
successor form) stating that interest paid in respect of the
Capital Securities (or on the Junior Subordinated Debentures) is
not subject to such withholding tax because it is effectively
connected with the Beneficial Owner's conduct of a trade or
business in the United States.
If a Non-United States Holder is engaged in a trade or
business in the United States and interest received in respect of
such Non-United States Holder's Capital Securities (or on such
Holder's Junior Subordinated Debentures) is effectively connected
with the conduct of such trade or business, the Non-United States
Holder, although exempt from the United States federal
withholding tax discussed above, will be subject to United States
federal income tax on such interest income on a net income basis
in the same manner as if it were a United States person. In
addition, if such Non-United States Holder is a foreign
corporation, it may be subject to a branch profits tax equal to
30% of its effectively connected earnings and profits for the
taxable year, subject to adjustments. For this purpose, such
interest income would be included in such foreign corporation's
effectively connected earnings and profits.
Any gain realized upon the sale or other taxable
disposition of the Capital Securities (or Junior Subordinated
Debentures) generally will not be subject to United States
federal income tax unless (i) such gain is effectively connected
with a trade or business carried on within the United States by
the Non-United States Holder, (ii) in the case of a Non-United
States Holder who is an individual, such individual is present in
the United States for 183 days or more in the taxable year of
such sale, exchange or other taxable disposition, and certain
other conditions are met, and (iii) in the case of any gain
representing accrued interest on the Junior Subordinated
Debentures, the requirements described above are not satisfied.
The exchange of the Old Capital Securities for the New
Capital Securities in the Exchange Offer should not constitute a
taxable event to Non-United States Holders.
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Information Reporting and Backup Withholding
Income on the Capital Securities (or Junior Subordinated
Debentures) held of record by United States Holders (other than
corporations and other exempt holders) will be reported annually
to such holders and to the IRS. The Administrators currently
intend to deliver such reports to holders of record prior to
January 31 following each calendar year. It is anticipated that
persons who hold Capital Securities (or Junior Subordinated
Debentures) as nominees for beneficial holders will report the
required tax information to beneficial holders on Form 1099.
"Backup withholding" at a rate of 31% will apply to
payments of interest (including OID) to non-exempt United States
Holders unless the holder furnishes its taxpayer identification
number in the manner prescribed in applicable Treasury
regulations, certifies that such number is correct, certifies as
to no loss of exemption from backup withholding and meets certain
other conditions.
No information reporting or backup withholding will be
required with respect to payments made by the Trust or any Paying
Agent to Non-United States Holders if a statement described in
(a)(iii) under "Non-United States Holders" has been received and
the payor does not have actual knowledge that the beneficial
owner is a United States person.
In addition, backup withholding and information reporting
will not apply if payments of the principal, interest, OID or
premium in respect of the Capital Securities (or Junior
Subordinated Debentures) are paid or collected by a foreign
office of a custodian, nominee or other foreign agent on behalf
of the Beneficial Owner, or if a foreign office of a broker (as
defined in applicable Treasury regulations) pays the proceeds of
the sale of the Capital Securities (or Junior Subordinated
Debentures) to the owner thereof. If, however, such nominee,
custodian, agent or broker is, for United States federal income
tax purposes, a United States person, a controlled foreign
corporation or a foreign person that derives 50% or more of its
gross income for certain periods from the conduct of a trade or
business in the United States, such payments will not be subject
to backup withholding but will be subject to information
reporting, unless (1) such custodian, nominee, agent or broker
has documentary evidence in its records that the Beneficial Owner
is not a United States person and certain other conditions are
met or (2) the Beneficial Owner otherwise establishes an
exemption.
Payment of the proceeds from disposition of Capital
Securities (or Junior Subordinated Debentures) to or through a
United States office of a broker is subject to information
reporting and backup withholding unless the holder or beneficial
owner establishes an exemption from information reporting and
backup withholding.
Any amounts withheld from a holder of the Capital
Securities (or Junior Subordinated Debentures) under the backup
withholding rules will be allowed as a refund or a credit against
such holder's United States federal income tax liability,
provided the required information is furnished to the IRS.
BOOK-ENTRY ISSUANCE
The New Capital Securities initially will be represented by
one or more Capital Securities in registered, global form
(collectively, the "Global Capital Securities"). The Global
Capital Securities will be deposited upon issuance with the
Property Trustee as custodian for The Depository Trust Company
("DTC"), in New York, New York, and registered in the name of DTC
or its nominee, in each case for credit to an account of a direct
or indirect participant in DTC as described below.
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Except as set forth below, the Global Capital Securities
may be transferred, in whole and not in part, only to another
nominee of DTC or to a successor of DTC or its nominee.
Beneficial interests in the Global Capital Securities may not be
exchanged for Capital Securities in certificated form except in
the limited circumstances described below. See "-- Exchange of
Book-Entry Capital Securities for Certificated Capital
Securities."
Other Capital Securities will be issued only in registered,
certificated (i.e., non-global) form. Other Capital Securities
may not be exchanged for beneficial interests in any Global
Capital Securities except in the limited circumstances described
below. See "-- Exchange of Certificated Capital Securities for
Book-Entry Capital Securities."
Transfer of beneficial interests in the Global Capital
Securities will be subject to the applicable rules and procedures
of DTC and its direct or indirect participants (including, if
applicable, those of Euroclear and CEDEL), which may change from
time to time.
Depositary Procedures
DTC has advised the Trust and the Company that DTC is a
limited-purpose trust company created to hold securities for its
participating organizations (collectively, the "Participants")
and to facilitate the clearance and settlement of transactions in
those securities between Participants through electronic
book-entry changes in accounts of its Participants. The
Participants include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations.
Access to DTC's system is also available to other entities such
as banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a Participant, either
directly or indirectly (collectively, the "Indirect
Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the
Participants or the Indirect Participants. The ownership interest
and transfer of ownership interest of each actual purchaser of
each security held by or on behalf of DTC are recorded on the
records of the Participants and Indirect Participants.
DTC has also advised the Trust and the Company that,
pursuant to procedures established by it, (i) upon deposit of the
Global Capital Securities, DTC will credit the accounts of
Participants with portions of the principal amount of the Global
Capital Securities and (ii) ownership of such interests in the
Global Capital Securities will be shown on, and the transfer of
ownership thereof will be effected only through, records
maintained by DTC (with respect to the Participants) or by the
Participants and the Indirect Participants (with respect to other
owners of beneficial interests in the Global Capital Securities).
All interests in a Global Capital Security, including those
held through Euroclear or CEDEL, may be subject to the procedures
and requirements of DTC. Those interests held through Euroclear
or CEDEL may also be subject to the procedures and requirements
of such system. The laws of some states require that certain
persons take physical delivery in certificated form of securities
that they own. Consequently, the ability to transfer beneficial
interests in a Global Capital Security to such persons will be
limited to that extent. Because DTC can act only on behalf of
Participants, which in turn act on behalf of Indirect
Participants and certain banks, the ability of a person having
beneficial interests in a Global Capital Security to pledge such
interests to persons or entities that do not participate in the
DTC system, or otherwise take actions in respect of such
interests, may be affected by the lack of a physical certificate
evidencing such interests. For certain other restrictions on the
transferability of the Capital Securities,
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see "-- Exchange of Book-Entry Capital Securities for
Certificated Capital Securities" and "-- Exchange of Certificated
Capital Securities for Book-Entry Capital Securities."
Except as described below, owners of interests in the
Global Capital Securities will not have Capital Securities
registered in their name, will not receive physical delivery of
Capital Securities in certificated form and will not be
considered the registered owners or holders thereof for any
purpose.
Payments in respect of the Global Capital Security
registered in the name of DTC or its nominee will be payable by
the Property Trustee to DTC in its capacity as the registered
holder. The Property Trustee will treat the persons in whose
names the Capital Securities, including the Global Capital
Securities, are registered as the owners thereof for the purpose
of receiving such payments and for any and all other purposes
whatsoever. Consequently, neither the Property Trustee nor any
agent thereof has or will have any responsibility or liability
for (i) any aspect of DTC's records or any Participant's or
Indirect Participant's records relating to or payments made on
account of beneficial ownership interests in the Global Capital
Securities, or for maintaining, supervising or reviewing any of
DTC's records or any Participant's or Indirect Participant's
records relating to the beneficial ownership interests in the
Global Capital Securities or (ii) any other matter relating to
the actions and practices of DTC or any of its Participants or
Indirect Participants. DTC has advised the Trust and the Company
that its current practice, upon receipt of any payment in respect
of securities such as the Capital Securities, is to credit the
accounts of the relevant Participants with the payment on the
payment date unless DTC has reason to believe it will not receive
payment on such payment date. Payments by the Participants and
the Indirect Participants to the beneficial owners of Capital
Securities will be governed by standing instructions and
customary practices and will be the responsibility of the
Participants or the Indirect Participants and will not be the
responsibility of DTC, the Property Trustee or the Trust. Neither
the Trust nor the Property Trustee will be liable for any delay
by DTC or any of its Participants in identifying the beneficial
owners of the Capital Securities, and the Trust and the Property
Trustee may conclusively rely on and will be protected in relying
on instructions from DTC or its nominee for all purposes.
Except for trades involving only Euroclear or CEDEL
participants, interests in the Global Capital Securities will
trade in DTC's Same-Day Funds Settlement System and secondary
market trading activity in such interests will therefore settle
in immediately available funds, subject in all cases to the rules
and procedures of DTC and its participants.
Transfers between Participants in DTC will be effected in
accordance with DTC's procedures, and will be settled in same-day
funds. Transfers between participants in Euroclear or CEDEL will
be effected in the ordinary way in accordance with their
respective rules and operating procedures.
Subject to compliance with the transfer restrictions
applicable to the Capital Securities described herein,
cross-market transfers between the Participants in DTC, on the
one hand, and Euroclear or CEDEL participants, on the other hand,
will be effected through DTC in accordance with DTC's rules on
behalf of Euroclear or CEDEL, as the case may be, by its
respective depositary; however, such cross-market transactions
will require delivery of instructions to Euroclear or CEDEL, as
the case may be, by the counterparty in such system in accordance
with the rules and procedures and within the established
deadlines (Brussels time) of such system. Euroclear or CEDEL, as
the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective depositary
to take action to effect final settlement on its behalf by
delivering or receiving interests in the relevant Global Capital
Securities in DTC, and making or receiving payment in accordance
with normal procedures for same-day funds settlement applicable
to DTC. Euroclear participants and CEDEL participants may not
deliver instructions directly to the depositaries for Euroclear
or CEDEL.
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Because of time zone differences, the securities account of
a Euroclear or CEDEL participant purchasing an interest in a
Global Capital Security from a Participant in DTC will be
credited, and any such crediting will be reported to the relevant
Euroclear or CEDEL participant, during the securities settlement
processing day (which must be a business day for Euroclear and
CEDEL) immediately following the settlement date of DTC. Cash
received in Euroclear or CEDEL as a result of sales of an
interest in a Global Capital Security by or through a Euroclear
or CEDEL participant to a Participant in DTC will be received
with value on the settlement date of DTC but will be available in
the relevant Euroclear or CEDEL cash account only as of the
business day for Euroclear or CEDEL following DTC's settlement
date.
DTC has advised the Trust and the Company that it will take
any action permitted to be taken by a holder of Capital
Securities only at the direction of one or more Participants to
whose account with DTC interests in the Global Capital Securities
are credited. However, if there is an Event of Default, DTC
reserves the right to exchange the Global Capital Securities for
legended Capital Securities in certificated form and to
distribute such Capital Securities to its Participants.
The information in this section concerning DTC, Euroclear and
CEDEL and their book-entry systems has been obtained from sources
that the Trust and the Company believe to be reliable, but
neither the Trust nor the Company takes responsibility for the
accuracy thereof.
Although DTC, Euroclear and CEDEL have agreed to the
foregoing procedures to facilitate transfers of interest in the
Regulation S Global Capital Securities and in the Restricted
Global Capital Securities among participants in DTC, Euroclear
and CEDEL, they are under no obligation to perform or to continue
to perform such procedures, and such procedures may be
discontinued at any time. Neither the Trust nor the Property
Trustee will have any responsibility for the performance by DTC,
Euroclear or CEDEL or their respective participants or indirect
participants of their respective obligations under the rules and
procedures governing their operations.
Exchange of Book-Entry Capital Securities for Certificated
Capital Securities
A Global Capital Security is exchangeable for Capital
Securities in registered certificated form if (i) DTC (x)
notifies the Trust that it is unwilling or unable to continue as
Depositary for the Global Capital Security and the Trust
thereupon fails to appoint a successor Depositary or (y) has
ceased to be a clearing agency registered under the Exchange Act,
(ii) the Company in its sole discretion elects to cause the
issuance of the Capital Securities in certificated form or (iii)
there shall have occurred and be continuing an Event of Default
or any event which after notice or lapse of time or both would be
an Event of Default under the Declaration. In addition,
beneficial interests in a Global Capital Security may be
exchanged for certificated Capital Securities upon request but
only upon at least 20 days' prior written notice given to the
Property Trustee by or on behalf of DTC in accordance with
customary procedures. In all cases, certificated Capital
Securities delivered in exchange for any Global Capital Security
or beneficial interests therein will be registered in the names,
and issued in any approved denominations, requested by or on
behalf of the Depositary (in accordance with its customary
procedures).
Exchange of Certificated Capital Securities for Book-Entry
Capital Securities
Capital Securities which will be issued in certificated
form may not be exchanged for beneficial interests in any Global
Capital Security unless such exchange occurs in connection with a
transfer of such certificated Capital Securities.
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ERISA CONSIDERATIONS
Each fiduciary of a pension, profit-sharing or other
employee benefit plan subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") (a "Plan"), should
consider the fiduciary standards of ERISA in the context of the
Plan's particular circumstances before authorizing an investment
in the Capital Securities. Accordingly, among other factors, the
fiduciary should consider whether the investment would satisfy
the prudence and diversification requirements of ERISA and would
be consistent with the documents and instruments governing the
Plan.
Section 406 of ERISA and Section 4975 of the Code prohibit
Plans, as well as individual retirement accounts and Keogh plans
subject to Section 4975 of the Code (also "Plans"), from engaging
in certain transactions involving "plan assets" with persons who
are "parties in interest" under ERISA or "disqualified persons"
under the Code (collectively, "Parties in Interest") with respect
to such Plan. A violation of these "prohibited transaction" rules
may result in an excise tax or other liabilities under ERISA
and/or Section 4975 of the Code for such persons, unless
exemptive relief is available under an applicable statutory or
administrative exemption. Employee benefit plans that are
governmental plans (as defined in Section 3(32) of ERISA),
certain church plans (as defined in Section 3(33) of ERISA) and
foreign plans (as described in Section 4(b)(5) of ERISA) are not
subject to the requirements of ERISA or Section 4975 of the Code.
Under a regulation (the "Plan Assets Regulation") issued by
the U.S. Department of Labor (the "DOL"), the assets of the Trust
would be deemed to be "plan assets" of a Plan for purposes of
ERISA and Section 4975 of the Code if "plan assets" of the Plan
were used to acquire an equity interest in such Trust and no
exception were applicable under the Plan Assets Regulation. An
"equity interest" is defined under the Plan Assets Regulation as
any interest in an entity other than an instrument which is
treated as indebtedness under applicable local law and which has
no substantial equity features and specifically includes a
beneficial interest in a trust.
Pursuant to an exception contained in the Plan Assets
Regulation, the assets of the Trust would not be deemed to be
"plan assets" of investing Plans if, immediately after the most
recent acquisition of any equity interest in the Trust, less than
25% of the value of each class of equity interests in the Trust
were held by Plans, other employee benefit plans not subject to
ERISA or Section 4975 of the Code (such as governmental, church
and foreign plans), and entities holding assets deemed to be
"plan assets" of any Plan (collectively, "Benefit Plan
Investors"). No assurance can be given that the value of the
Capital Securities held by Benefit Plan Investors will be less
than 25% of the total value of such Capital Securities at the
completion of the Exchange Offer or thereafter, and no monitoring
or other measures will be taken with respect to the satisfaction
of the conditions to this exception. All of the Common Securities
will be purchased and held by the Company.
Under another exception contained in the Plan Assets
Regulation, if the New Capital Securities were to qualify as
"publicly offered securities" under the Plan Assets Regulation
the assets of the Trust would not be deemed to be "plan assets"
by reason of a Plan's acquisition or holding of such securities.
The New Capital Securities would qualify as "publicly offered
securities" if, among other things, they are offered pursuant to
an effective registration statement, are owned by 100 or more
investors independent of the issuer and each other at the time of
the offering, and are subsequently registered under the Exchange
Act. It is expected that the 100 investor requirement will not be
satisfied and that the New Capital Securities will not be
registered under the Exchange Act.
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Certain transactions involving the Trust could be deemed to
constitute direct or indirect prohibited transactions under ERISA
and Section 4975 of the Code with respect to a Plan if the
Capital Securities of the Trust were acquired with "plan assets"
of such Plan and assets of the Trust were deemed to be "plan
assets" of Plans investing in the Trust. For example, if the
Company is a Party in Interest with respect to an investing Plan
(either directly or by reason of its ownership of its
subsidiaries), extensions of credit between the Company and the
Trust (as represented by the Junior Subordinated Debentures and
the Guarantees) would likely be prohibited by Section
406(a)(I)(B) of ERISA and Section 4975(e)(1)(B) of the Code,
unless exemptive relief were available under an applicable
administrative exemption (see below).
The DOL has issued five prohibited transaction class
exemptions ("PTCEs") that may provide exemptive relief for direct
or indirect prohibited transactions resulting from the purchase
or holding of the Capital Securities, assuming that assets of the
Trust were deemed to be "plan assets" of Plans investing in the
Trust (see above). Those class exemptions are PTCE 96-23 (for
certain transactions determined by in-house asset managers), PTCE
95-60 (for certain transactions involving insurance company
general accounts), PTCE 91-38 (for certain transactions involving
bank collective investment funds), PTCE 90-1 (for certain
transactions involving insurance company separate accounts), and
PTCE 84-14 (for certain transactions determined by independent
qualified asset managers).
Because the Capital Securities may be deemed to be equity
interests in the Trust for purposes of applying ERISA and Section
4975 of the Code, the Capital Securities may not be purchased or
held by any Plan, any entity whose underlying assets include
"plan assets" by reason of any Plan's investment in the entity (a
"Plan Asset Entity") or any person investing "plan assets" of any
Plan, unless such purchaser or holder is eligible for the
exemptive relief available under PTCE 96-23, 95-60, 91-38, 90-1
or 84-14 or another applicable exemption. Any purchaser or holder
of the Capital Securities or any interest therein will be deemed
to have represented by its purchase and holding thereof that
either (a) it is not a Plan or a Plan Asset Entity and is not
purchasing such securities on behalf of or with "plan assets" of
any Plan or (b) (i) it is eligible for the exemptive relief
available under PTCE 96-23, 95-60, 91-38, 90- 1 or 84-14 or
another applicable exemption with respect to such purchase or
holding, (ii) the Company and the Administrators are not
"fiduciaries," within the meaning of Section 3(21) of ERISA and
the regulations thereunder, with respect to the acquisition of
its interest in the Capital Securities or the Junior Subordinated
Debentures, and (iii) in purchasing the Capital Securities it
approved the purchase and holding of the Junior Subordinated
Debentures and the appointment and retention of the Issuer
Trustees. Any purchaser or holder of the Old Capital Securities
or any interest therein will be deemed to have represented by its
exchange thereof for New Capital Securities in the Exchange Offer
that either (a) it is not a Plan or a Plan Asset Entity and the
Old Capital Securities being exchanged by it are not "plan
assets" of any Plan or (b) (i) it is eligible for the exemptive
relief available under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or
another applicable exemption with respect to such exchange, (ii)
the Company and the Administrators are not "fiduciaries," within
the meaning of Section 3(21) of ERISA and the regulations
thereunder, with respect to the acquisition of its interest in
the New Capital Securities or the New Junior Subordinated
Debentures, and (iii) in exchanging the Old Capital Securities
for the New Capital Securities in the Exchange Offer, it approved
the purchase and holding of the New Junior Subordinated
Debentures and the appointment and retention of the Issuer
Trustees.
Due to the complexity of these rules and the penalties that
may be imposed upon persons involved in non-exempt prohibited
transactions, it is particularly important that fiduciaries or
other persons considering purchasing the Capital Securities on
behalf of or with "plan assets" of any Plan consult with their
counsel regarding the potential consequences if the assets of the
Trust were deemed to
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be "plan assets" and the availability of exemptive relief under
PTCE 96-23, 95-60, 91-38, 90-1 or 84-14, or another applicable
exemption.
Governmental plans and certain church plans are not subject
to ERISA and are also not subject to the prohibited transaction
provisions of Section 4975 of the Code. However, state laws or
regulations governing the investment and management of the assets
of such plans may contain fiduciary and prohibited transaction
provisions similar to those under ERISA and the Code discussed
above. Accordingly, fiduciaries of governmental plans and church
plans, in consultation with their advisers, should consider the
impact of their respective state laws on investments in the
Capital Securities, and the considerations discussed above, to
the extent applicable.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Capital Securities for
its own account pursuant to the Exchange Offer must acknowledge
that it will deliver a prospectus in connection with any resale
of such New Capital Securities. This Prospectus, as it may be
amended or supplemented from time to time, may be used by a
broker-dealer in connection with resales of New Capital
Securities received in exchange for Old Capital Securities where
such Old Capital Securities were acquired as a result of
market-making activities or other trading activities. The Company
and the Trust have agreed that, starting on the date on which the
Exchange Offer is consummated and ending on the close of business
one year after such date, they will make this Prospectus, as
amended or supplemented, available to any broker-dealer for use
in connection with any such resale. In addition, until December
14, 1997, all dealers effecting transactions in the New Capital
Securities may be required to deliver a prospectus.
The Company and the Trust will not receive any proceeds
from any sale of New Capital Securities by broker-dealers. New
Capital Securities received by broker-dealers for their own
account pursuant to the Exchange Offer may be sold from time to
time in one or more transactions in the over-the-counter market,
in negotiated transactions, through the writing of options on the
New Capital Securities or a combination of such methods of
resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to
or through brokers or dealers who may receive compensation in the
form of commissions or concessions from any such broker-dealer
and/or the purchasers of any such New Capital Securities. Any
broker-dealer that resells New Capital Securities that were
received by it for its own account pursuant to the Exchange Offer
and any broker or dealer that participates in a distribution of
such New Capital Securities may be deemed to be an "underwriter"
within the meaning of the Securities Act and any profit on any
such resale of New Capital Securities and any commissions or
concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of
Transmittal states that by acknowledging that it will deliver and
by delivering a prospectus, a broker-dealer will not be deemed to
admit that it is an "underwriter" within the meaning of the
Securities Act.
For a period of one year after the date on which the
Exchange Offer is consummated, the Company and the Trust will
promptly send additional copies of this Prospectus and any
amendment or supplement to this Prospectus to any broker-dealer
that requests such documents in the Letter of Transmittal. The
Company and the Trust have agreed to pay all expenses incident to
the Exchange Offer (including the expenses of one counsel for the
Holders of the New Capital Securities) other than commissions or
concessions of any brokers or dealers and will indemnify the
Holders of the New Capital Securities (including any
broker-dealers) against certain liabilities, including
liabilities under the Securities Act.
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LEGAL MATTERS
Certain matters of Delaware law relating to the validity of
the New Capital Securities will be passed upon for the Trust and
the Company by Richards, Layton & Finger, Wilmington, Delaware.
The validity under New York law of the New Junior Subordinated
Debentures and the New Guarantee will be passed upon for the
Company and the Trust by Cleary, Gottlieb, Steen & Hamilton, New
York, New York. Cleary, Gottlieb, Steen & Hamilton will rely as
to certain matters of Delaware law on the opinion of Richards,
Layton & Finger. Certain United States federal income tax matters
also will be passed upon for the Company and the Trust by Cleary,
Gottlieb, Steen & Hamilton.
INDEPENDENT ACCOUNTANTS
The consolidated financial statements for the year ended
December 31, 1996 incorporated herein by reference from the
Company's Annual Report on Form 10-K have been audited by Price
Waterhouse LLP, independent accountants, as stated in their
report, which is incorporated herein by reference. The
consolidated financial statements for the years ended December
31, 1995 and 1994 incorporated herein by reference from the
Company's Annual Report on Form 10-K for the year ended December
31, 1996 have been audited by KPMG Peat Marwick LLP, independent
accountants, as stated in their report, which is incorporated
herein by reference.
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=================================================================
No person has been authorized to give any information or to
make any representations other than those contained in this
Prospectus or the accompanying Letter of Transmittal, and, if
given or made, such information or representation must not be
relied upon as having been authorized. This Prospectus and the
accompanying Letter of Transmittal do not constitute an offer to
sell or the solicitation of an offer to buy any securities other
than the securities described in this Prospectus and the
accompanying Letter of Transmittal or an offer to sell or the
solicitation of an offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus or the accompanying
Letter of Transmittal nor any sale made hereunder shall, under
any circumstances, create any implication that the information
contained herein is correct as of any time subsequent to the date
of such information.
---------------
TABLE OF CONTENTS
Page
Available Information.... 7
Incorporation of Certain
Information by
Reference.............. 7
Summary.................. 9
Risk Factors............. 17
Use of Proceeds.......... 22
Ratio of Earnings to
Combined Fixed
Charges and Preferred
Stock Dividends........ 23
Accounting Treatment..... 23
Regulatory Treatment..... 24
Capitalization........... 24
The Trust................ 24
The Exchange Offer ...... 26
Description of
Capital Securities..... 36
Description of
Junior Subordinated
Debentures.............. 46
Description of Guarantee 55
Relationship Among
the Capital
Securities, the
Junior Subordinated
Debentures and
the Guarantee.......... 58
Certain United States
Federal Income Tax
Consequences........... 59
Book-Entry Issuance...... 64
ERISA Considerations..... 68
Plan of Distribution..... 70
Legal Matters............ 71
Independent Auditors..... 71
=================================================================
=================================================================
GREENPOINT
CAPITAL TRUST I
$200,000,000
9.10% Subordinated Capital Income
Securities
(Liquidation Amount $1,000 per
Capital Security)
Fully and Unconditionally
Guaranteed to the Extent Set Forth
Herein by
GREENPOINT FINANCIAL CORP.
---------------
PROSPECTUS
Dated September , 1997
---------------
=================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers.
(i) Section 102(b)(7) of the General Corporation Law of the
State of Delaware provides that a Delaware corporation may
include in its certificate of incorporation a provision
eliminating or limiting the personal liability of a director to
the corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, provided that such
provision may not eliminate or limit the liability of a director
for any breach of the director's duty of loyalty to the
corporation or its stockholders, for actions or omissions not in
good faith or which involve intentional misconduct or a knowing
violation of law, for the payment of unlawful dividends, or for
any transaction from which the director derived an improper
personal benefit. Article Eleventh of the Amended and Restated
Certificate of Incorporation of GreenPoint contains a provision
limiting the personal liability of a director to GreenPoint and
its stockholders for monetary damages for a breach of fiduciary
duty as a director to the full extent permitted by law.
(ii) Additionally, Section 145, "Indemnification of Officers,
Directors, Employees, and Agents; Insurance", of the General
Corporation Law of the State of Delaware provides as follows:
"(a) A corporation may indemnify any person who was or
is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of
the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a
director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in
a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to
believe that his conduct was unlawful.
(b) A corporation may indemnify any person who was or
is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in
the right of the corporation to procure a judgment in its
favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director,
officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense
or settlement of such action or suit if he acted in good
faith and in a manner he reasonably believed to be in or
not opposed to the best interest of the corporation and
except that no indemnification shall be made in respect of
any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless
and only to the extent that the Court of Chancery or the
court in which such
73
<PAGE>
action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of
all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem
proper.
(c) To the extent that a director, officer, employee
or agent of a corporation has been successful on the merits
or otherwise in defense of any action, suit or proceeding
referred to in subsections (a) and (b) of this section, or
in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection
therewith.
(d) Any indemnification under subsections (a) and (b)
of this section ( unless ordered by a court) shall be made
by the corporation only as authorized in the specific case
upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances
because he has met the applicable standard of conduct set
forth in subsections (a) and (b) of this section. Such
determination shall be made (1) by a majority vote of the
directors who are not parties to such action, suit or
proceeding, even though less than a quorum, or (2) if there
are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (3) by
the stockholders.
(e) Expenses (including attorneys' fees) incurred by
an officer or director in defending any civil, criminal,
administrative or investigative action, suit or proceeding
may be paid by the corporation in advance of the final
disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or
officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by other employees and
agents may be so paid upon such terms and conditions, if
any, as the board of directors deems appropriate.
(f) The indemnification and advancement of expenses
provided by, or granted pursuant to, the other subsections
of this section shall not be deemed exclusive of any other
rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw,
agreement, vote of stockholders or disinterested directors
or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such
office.
(g) A corporation shall have power to purchase and
maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a
director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and
incurred by him in any such capacity, or arising out of his
status as such, whether or not the corporation would have
the power to indemnify him against such liability under
this section.
(h) For purposes of this section, references to "the
corporation" shall include, in addition to the resulting
corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation
or merger which, if its separate existence had continued,
would have had power and authority to indemnify its
directors, officers, and employees or agents, so that any
person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at
the request of such constituent corporation as director,
officer, employee or agent of another corporation,
partnership, joint venture, trust or other
74
<PAGE>
enterprise, shall stand in the same position under this section
with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if
its separate existence had continued.
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans;
references to "fines" shall include any excise taxes
assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the
corporation" shall include any service as a director,
officer, employee or agent of the corporation which imposes
duties on, or involves services by, such director, officer,
employee or agent with respect to an employee benefit plan,
its participants or beneficiaries; and a person who acted
in good faith and in a manner he reasonably believed to be
in the interest of the participants and beneficiaries of an
employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the
corporation" as referred to in this section.
(j) The indemnification and advancement of expenses
provided by, or granted pursuant to, this section shall,
unless otherwise provided when authorized or ratified,
continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit
of the heirs, executors and administrators of such a
person.
(k) The Court of Chancery is hereby vested with
exclusive jurisdiction to hear and determine all actions
for advancement of expenses or indemnification brought
under this section or under any bylaw, agreement, vote of
stockholders or disinterested directors, or otherwise. The
Court of Chancery may summarily determine a corporation's
obligation to advance expenses (including attorneys' fees)."
(iii) Article Tenth of the Amended and Restated Certificate
of Incorporation of GreenPoint provides for indemnification of
directors and officers of GreenPoint against liability they may
incur in their capacities as such to the full extent permitted
under Delaware law.
(iv) GreenPoint maintains insurance policies that insure
the directors and officers of GreenPoint against loss arising
from any claim or claims made against such directors or officers,
individually or collectively, by reason of certain wrongful acts
such as any actual or alleged error or misstatement or misleading
statement or act, omission, neglect or breach of duty by the
officers and directors in the discharge of their duties. The
policies also insure GreenPoint against loss for which GreenPoint
is required to indemnify or for which GreenPoint, to the extent
permitted by law, has indemnified the officers or directors
arising from any claim against any of the directors or officers
of GreenPoint by reason of the wrongful acts described above. The
policies do not insure GreenPoint's directors and officers
against loss in connection with any claim relating to any
deliberately dishonest or fraudulent act or omission, any
criminal or malicious act or omission, any willful violation of
law or any accounting for profits for the purchase or sale of
securities of GreenPoint within the meaning of Section 16(b) of
the Exchange Act.
(v) Under the Declaration, GreenPoint has agreed to
indemnify each of the Trustees of the Trust, and to hold the
Trustees harmless against, any loss, liability or expense
incurred without negligence or bad faith on the Trustees' part,
arising out of or in connection with the acceptance or
administration of the Declaration, including the costs and
expenses of defending themselves against or investigating any
claim or liability in connection with the exercise or performance
of any of their powers or duties under the Declaration.
75
<PAGE>
Item 21. Exhibits and Financial Statement Schedules.
Exhibit
No. Description
- --- -----------
4.1 Indenture, dated as of June 3, 1997, between GreenPoint and
The Bank of New York, as Trustee, in respect of GreenPoint's
9.10% Junior Subordinated Debentures due 2027.*
4.2 Form of GreenPoint's 9.10% Junior Subordinated Debentures
due 2027 (included in the Indenture filed as Exhibit 4.1 to
this Registration Statement).*
4.3 Certificate of Trust of GreenPoint Capital Trust I, dated
May 23, 1997.*
4.4 Amended and Restated Declaration of Trust of GreenPoint
Capital Trust I, dated as of June 3, 1997, among GreenPoint,
as sponsor, the Administrators thereof, The Bank of New York
(Delaware), as Delaware Trustee, The Bank of New York, as
Institutional Trustee, and the holders from time to time of
undivided interests in the assets of GreenPoint Capital
Trust I.*
4.5 Form of Capital Security Certificate for GreenPoint Capital
Trust I (included in the Amended and Restated Declaration of
Trust filed as Exhibit 4.4 to this Registration Statement).*
4.6 Form of Guarantee Agreement, dated as of , 1997, between
GreenPoint and The Bank of New York, as Guarantee Trustee.*
4.7 Registration Rights Agreement, dated June 3, 1997, among
GreenPoint, GreenPoint Capital Trust I and Lehman Brothers
Inc., as Representative of the Initial Purchasers.*
5.1 Opinion of Richards, Layton & Finger as to the validity of
the New Capital Securities to be issued by GreenPoint
Capital Trust I.**
5.2 Opinion of Cleary, Gottlieb, Steen & Hamilton as to the
validity of the New Junior Subordinated Debentures and the
New Guarantee to be issued by GreenPoint.**
8 Opinion of Cleary, Gottlieb, Steen & Hamilton regarding
certain federal income tax matters.**
23.1 Consent of Price Waterhouse LLP.***
23.2 Consent of KPMG Peat Marwick LLP.***
23.3 Consent of Richards, Layton & Finger (included in Exhibit
5.1 to this Registration Statement).**
23.4 Consent of Cleary, Gottlieb, Steen & Hamilton (included in
Exhibit 5.2 to this Registration Statement).**
23.5 Consent of Cleary, Gottlieb, Steen & Hamilton (included in
Exhibit 8 to this Registration Statement).**
76
<PAGE>
Exhibit
No. Description
- --- -----------
24 Powers of Attorney.*
25.1 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Indenture.*
25.2 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Amended and Restated Declaration of
Trust.*
25.3 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Guarantee for the benefit of the
holders of Capital Securities.*
99.1 Form of Letter of Transmittal.*
99.2 Form of Notice of Guaranteed Delivery.*
99.3 Form of Exchange Agent Agreement.*
- --------
* Previously filed.
** Filed herewith.
*** Refiled herewith.
Item 22. Undertakings.
(a) Each of the undersigned registrants hereby undertakes
that, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(b) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of a registrant pursuant to the
foregoing provisions, or otherwise, each of the undersigned
registrants has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by a registrant
of expenses incurred or paid by a director, officer or
controlling director, officer or controlling person of a
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, each
of the undersigned registrants will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the act and will be governed by the final
adjudication of such issue.
(c) Each of the undersigned registrants hereby undertakes to
respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11 or 13
of this Form,
77
<PAGE>
within one business day of receipt of such request, and to send
the incorporated documents by first class mail or other equally
prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration
statement through the date of responding to the request.
(d) Each of the undersigned registrants hereby undertakes to
supply by means of post-effective amendment all information
concerning a transaction, and the company being acquired involved
therein, that was not the subject of and included in the
registration statement when it became effective.
78
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Amendment No. 1 to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of New York, State of New York, on September 11, 1997.
GREENPOINT FINANCIAL CORP.
(Registrant)
By /s/ Thomas S. Johnson
------------------------
Thomas S. Johnson
Chairman of the Board, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of
1933, this Amendment No. 1 to the Registration Statement has been
signed below by the following persons in the capacities and on the
dates indicated.
Name Title Date
---- ----- ----
/s/ Thomas S. Johnson Chairman of the Board, September 11, 1997
- ------------------------ President, Chief
Thomas S. Johnson Executive Officer and
Director (Principal
Executive Officer)
/s/ Charles P. Richardson Executive Vice President September 11, 1997
- ------------------------- and Chief Financial
Charles P. Richardson Officer (Principal
Financial Officer)
/s/ Mary Beth Farrell Senior Vice President September 11, 1997
- ------------------------ and Comptroller
Mary Beth Farrell (Principal Accounting
Officer)
/s/ Bernard S. Berman Director September 11, 1997
- ------------------------
Bernard S. Berman*
/s/ Edward C. Bessey Director September 11, 1997
- ------------------------
Edward C. Bessey*
/s/ Dan F. Huebner Director September 11, 1997
- ------------------------
Dan F. Huebner*
/s/ William M. Jackson Director September 11, 1997
- ------------------------
William M. Jackson*
/s/ Susan J. Kropf Director September 11, 1997
- ------------------------
Susan J. Kropf*
/s/ Robert M. McLane Director September 11, 1997
- ------------------------
Robert M. McLane*
79
<PAGE>
/s/ Charles B. McQuade Director September 11, 1997
- ------------------------
Charles B. McQuade*
/s/ Alvin N. Puryear Director September 11, 1997
- ------------------------
Alvin N. Puryear*
/s/ Robert P. Quinn Director September 11, 1997
- ------------------------
Robert P. Quinn*
/s/ Edward C. Schmults Director September 11, 1997
- ------------------------
Edward C. Schmults*
/s/ Wilfred O. Uhl Director September 11, 1997
- ------------------------
Wilfred O. Uhl*
/s/ Robert Vizza Director September 11, 1997
- ------------------------
Robert Vizza*
/s/ Jules Zimmerman Director September 11, 1997
- ------------------------
Jules Zimmerman*
*By /s/ Howard C. Bluver
80
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Amendment No. 1 to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of New York, State of New York, on September 11, 1997.
GREENPOINT CAPITAL TRUST I
(Registrant)
By /s/ Mary Beth Farrell
---------------------------
Mary Beth Farrell
Administrator
By /s/ Robert Beck
---------------------------
Robert Beck
Administrator
81
[Letterhead of Richards, Layton & Finger]
September 11, 1997
GreenPoint Capital Trust I
c/o GreenPoint Financial Corp.
90 Park Avenue
New York, NY 10016
Re: GreenPoint Capital Trust I
Ladies and Gentlemen:
We have acted as special Delaware counsel for
GreenPoint Financial Corp., a Delaware corporation (the "Company"),
and GreenPoint Capital Trust I, a Delaware business trust (the
"Trust"), in connection with the matters set forth herein. At
your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set
forth, our examination of documents has been limited to the
examination of originals or copies of the following:
(a) The Certificate of Trust of the Trust, dated as of
May 23, 1997 (the "Certificate"), as filed in the office of the
Secretary of State of the State of Delaware (the "Secretary of
State") on May 23, 1997;
(b) The Declaration of Trust of the Trust, dated as of
May 23, 1997, by and among the Company and the trustees of the Trust
named therein;
<PAGE>
GreenPoint Capital Trust I
September 11, 1997
Page 2
(c) The Amended and Restated Declaration of Trust of
the Trust, dated as of June 3, 1997 (including Exhibits A and B
thereto) (the "Amended Declaration"), among the Company, as
sponsor, the trustees of the Trust named therein, the
Administrators and the holders, from time to time, of undivided
beneficial interests in the assets of the Trust;
(d) The Correction Agreement, dated as of September 10,
1997 (the "Correction Agreement"), by and among the Company, as
Sponsor, Guarantor, Debenture Issuer and Common Securities
Holder; The Bank of New York, as Property Trustee and Guarantee
Trustee; The Bank of New York (Delaware), as Delaware Trustee;
and Mary Beth Farrell, Robert Beck and David Carroll, as
Administrators (the Amended Declaration and the Correction
Agreement being hereinafter jointly referred to as the
"Declaration");
(e) Amendment No. 1 to the Registration Statement on
Form S-4 (the "Registration Statement"), including a preliminary
prospectus (the "Prospectus"), relating to the 9.10% Subordinated
Capital Income Securities of the Trust representing undivided
beneficial interests in the assets of the Trust (each, a "Capital
Security" and collectively, the "Capital Securities"), as
proposed to be filed by the Company and the Trust with the
Securities and Exchange Commission on or about September 11,
1997; and
(f) A Certificate of Good Standing for the Trust, dated
September 11, 1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not
otherwise defined are used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a)
through (f) above. In particular, we have not reviewed any
document (other than the documents listed in paragraphs (a)
through (f) above) that is referred to in or incorporated by
reference into the documents reviewed by us. We have assumed that
there exists no provision in any document that we have not
reviewed that is inconsistent with the opinions stated herein. We
have conducted no independent factual investigation of our own
but rather have relied solely upon the foregoing documents, the
statements and information set forth therein and the additional
matters recited or assumed herein, all of which we have assumed
to be true, complete and accurate in all material respects.
<PAGE>
GreenPoint Capital Trust I
September 11, 1997
Page 3
With respect to all documents examined by us, we have
assumed (i) the authenticity of all documents submitted to us as
authentic originals, (ii) the conformity with the originals of
all documents submitted to us as copies or forms, and (iii) the
genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that
the Declaration constitutes the entire agreement among the
parties thereto with respect to the subject matter thereof,
including with respect to the creation, operation and termination
of the Trust, and that the Declaration and the Certificate are in
full force and effect and have not been amended, (ii) except to
the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents
examined by us under the laws of the jurisdiction governing its
creation, organization or formation, (iii) the legal capacity of
natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has
the power and authority to execute and deliver, and to perform
its obligations under, such documents, (v) the due authorization,
execution and delivery by all parties thereto of all documents
examined by us, (vi) the receipt by each Person to whom a Capital
Security is to be issued by the Trust (collectively, the "Capital
Security Holders") of a Capital Securities Certificate and the
consideration for the Capital Security acquired by it, in
accordance with the Declaration and the Registration Statement,
and (vii) that the Capital Securities are issued to the Capital
Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the
preparation of the Registration Statement and assume no
responsibility for its contents.
This opinion is limited to the laws of the State of
Delaware (excluding the securities laws of the State of
Delaware), and we have not considered and express no opinion on
the laws of any other jurisdiction, including federal laws and
rules and regulations relating thereto. Our opinions are rendered
only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of
such questions of law and statutes of the State of Delaware as we
have considered necessary or appropriate, and subject to the
assumptions, qualifications, limitations and exceptions set forth
herein, we are of the opinion that:
1. The Trust has been duly created and is validly
existing in good standing as a business trust under the Business
Trust Act.
<PAGE>
GreenPoint Capital Trust I
September 11, 1997
Page 4
2. The Capital Securities will represent valid and,
subject to the qualifications set forth in paragraph 3 below,
fully paid and nonassessable undivided beneficial interests in
the assets of the Trust.
3. The Capital Security Holders, as beneficial
owners of the Trust, will be entitled to the same limitation of
personal liability extended to stockholders of private
corporations for profit organized under the General Corporation
Law of the State of Delaware.
We consent to the filing of this opinion with the
Securities and Exchange Commission as an exhibit to the
Registration Statement. In addition, we hereby consent to the use
of our name under the heading "Legal Matters" in the Prospectus.
In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended, or the
rules and regulations of the Securities and Exchange Commission
thereunder. Except as stated above, without our prior written
consent, this opinion may not be furnished or quoted to, or
relied upon by, any other Person for any purpose.
Very truly yours,
/s/ RICHARDS, LAYTON & FINGER
BJK/bjr
[Letterhead of Cleary, Gottlieb, Steen & Hamilton]
Writer's Direct Dial: (212) 225-2520
September 11, 1997
GreenPoint Financial Corp.
90 Park Avenue
New York, New York 10016
Re: Registration Statement on Form S-4
Ladies and Gentlemen:
We have acted as counsel to GreenPoint Financial
Corp., a Delaware corporation (the "Company"), and Sponsor of
GreenPoint Capital Trust I, a Delaware statutory business trust
(the "Trust"), in connection with the Registration Statement on
Form S-4 of the Company and the Trust (the "Registration
Statement") filed today with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended
(the "Securities Act"), in respect of (i) the proposed issuance
by the Trust of $200,000,000 aggregate liquidation amount of
9.10% Subordinated Capital Income Securities (the "New Capital
Securities") registered under the Securities Act in exchange for
up to $200,000,000 aggregate liquidation amount of 9.10%
Subordinated Capital Income Securities (the "Old Capital
Securities"); (ii) the proposed issuance by the Company to the
Trust of $206,185,567 aggregate principal amount of the Company's
9.10% Junior Subordinated Debentures due 2027 (the "New Junior
Subordinated Debentures") registered under the Securities Act in
exchange for up to $206,185,567 aggregate principal amount of the
Company's 9.10% Junior Subordinated Debentures due 2027 (the "Old
Junior Subordinated Debentures"); and (iii) the Company's Guarantee
of the New Capital Securities registered under the Securities Act
in exchange for the Company's Guarantee of the Old Capital
<PAGE>
GreenPoint Financial Corp., p. 2
Securities, all as more fully described in the Registration
Statement and the Prospectus included as part of the Registration
Statement.
The New Capital Securities will be issued pursuant to
an Amended and Restated Declaration of Trust, dated as of June 3,
1997, among the Company, as Sponsor, the Administrators thereof,
The Bank of New York (Delaware), as Delaware Trustee, and The
Bank of New York, as Property Trustee (the "Amended
Declaration"); and the New Junior Subordinated Debentures will be
issued pursuant to an Indenture, dated as of June 3, 1997,
between the Company and The Bank of New York, as trustee (the
"Indenture").
We have participated in the preparation of the
Registration Statement and have reviewed originals or copies
certified or otherwise identified to our satisfaction of such
documents and records of the Company and the Trust and such other
instruments and other certificates of public officials, officers
and representatives of the Company and the Trust and such other
persons, and we have made such investigations of law, as we have
deemed appropriate as a basis for the opinions expressed below.
Based on the foregoing, and subject to the further
assumptions and qualifications set forth below, it is our opinion
that:
1. When the New Junior Subordinated Debentures, in the
form filed as an exhibit to the Registration Statement, have been
duly executed and authenticated in accordance with the Indenture,
and duly issued and delivered by the Company in exchange for an
equal principal amount of Old Junior Subordinated Debentures
pursuant to the terms of the Registration Rights Agreement, the
New Junior Subordinated Debentures will be valid and binding
obligations of the Company, entitled to the benefits of the
Indenture.
2. The Guarantee to be issued by the Company has been
duly and validly authorized and, upon proper execution and
delivery thereof, will be a valid and binding obligation of the
Company enforceable against the Company in accordance with its
terms.
The foregoing opinions are subject to applicable
bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to general principles of equity.
The foregoing opinions are limited to the law of the
State of New York.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement and to the reference to
this firm under the heading "Legal Matters" in the Prospectus
included in the Registration Statement. In giving such consent,
we do not thereby admit that we
<PAGE>
GreenPoint Financial Corp., p. 3
are "experts" within the meaning of the Securities Act or the
rules and regulations of the Securities and Exchange Commission
issued thereunder with respect to any part of the Registration
Statement, including this exhibit.
Very truly yours,
CLEARY, GOTTLIEB, STEEN & HAMILTON
By /s/ Michael L. Ryan
----------------------------
Michael L. Ryan, a Partner
[Letterhead of Cleary, Gottlieb, Steen & Hamilton]
Writer's Direct Dial: (212) 225-2540
September 11, 1997
Greenpoint Financial Corp.
90 Park Avenue
New York, New York 10016
Ladies and Gentlemen:
We have acted as counsel to GreenPoint Financial
Corp., a Delaware corporation (the "Company"), and Sponsor of
GreenPoint Capital Trust I, a Delaware statutory business trust
(the "Trust"), in connection with the Registration Statement on
Form S-4 of the Company and the Trust (the "Registration
Statement") filed today with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended
(the "Securities Act"), in respect of (i) the proposed issuance
by the Trust of $200,000,000 aggregate liquidation amount of
9.10% Subordinated Capital Income Securities (the "New Capital
Securities") registered under the Securities Act in exchange for
up to $200,000,000 aggregate liquidation amount of 9.10%
Subordinated Capital Income Securities (the "Old Capital
Securities") and (ii) the proposed issuance by the Company to the
Trust of $206,185,567 aggregate principal amount of the Company's
9.10% Junior Subordinated Debentures due 2027 (the "New Junior
Subordinated Debentures") registered under the Securities Act in
exchange for up to $206,185,567 aggregate principal amount of the
Company's 9.10% Junior Subordinated Debentures due 2027 (the "Old
Junior Subordinated Debentures"), all as more fully described in
the Registration Statement and the Prospectus included as part of
the Registration Statement.
Our opinion is based on the Internal Revenue Code of
1986, as amended, U.S. Treasury regulations promulgated
thereunder, and administrative and judicial interpretations
thereof, all as of the date hereof and all of which are subject
to change, possibly on a retroactive basis. In rendering this
opinion, we are expressing our views only as to the federal
income tax laws of the United States of America.
<PAGE>
Subject to the assumptions, qualifications, and conditions
set forth herein, it is our opinion that the discussion set forth
in the Registration Statement under the caption "Certain United
States Federal Income Tax Consequences" fairly and accurately
summarizes the specific tax matters addressed therein, based upon
current law and the assumptions stated or referred to therein.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement, and to the use of our name
under the heading "Certain United States Federal Income Tax
Consequences."
Very truly yours,
CLEARY, GOTTLIEB, STEEN & HAMILTON
By /s/ Yaron Z. Reich
----------------------------------
Yaron Z. Reich, a Partner
2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the
Prospectus constituting part of this Amendment No. 1 to the
Registration Statement on Form S-4 of GreenPoint Financial Corp.
and GreenPoint Capital Trust of our report dated January 21,
1997, which is incorporated by reference in GreenPoint Financial
Corp.'s Annual Report on Form 10-K for the year ended December
31, 1996. We also consent to the reference to us under the
heading "Independent Accountants" in such Prospectus.
/s/ Price Waterhouse LLP
September 11, 1997
New York, New York
Independent Auditors' Consent
-----------------------------
The Shareholders and the Board of Directors of
GreenPoint Financial Corp.
We consent to incorporation by reference in the registration statement
(No. 333- ) on Form S-4 of GreenPoint Financial Corp. of our report dated
January 19, 1996 relating to the consolidated statement of financial
condition of GreenPoint Financial Corp. and Subsidiaries as of December
31, 1995 and the related consolidated statements of income, changes in
stockholders' equity and cash flows for the years ended December 31, 1995
and 1994, which report is included in the December 31, 1996 annual report
on Form 10-K of GreenPoint Financial Corp. We also consent to the reference
to our Firm under the heading "Independent Accountants" in the registration
statement.
/s/ KPMG PEAT MARWICK LLP
Jericho, New York
August 19, 1997
