<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 21, 1996
REGISTRATION NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
KEYCORP
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
OHIO 34-6542451
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
ORGANIZATION)
</TABLE>
127 PUBLIC SQUARE
CLEVELAND, OHIO 44114-1306
(216) 689-6300
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------
THOMAS C. STEVENS, ESQ.,
EXECUTIVE VICE PRESIDENT,
GENERAL COUNSEL AND SECRETARY
KEYCORP
127 PUBLIC SQUARE
CLEVELAND, OHIO 44114-1306
(216) 689-6300
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------
COPIES TO:
<TABLE>
<S> <C>
DANIEL R. STOLZER, ESQ. STUART K. FLEISCHMANN, ESQ.
KEYCORP SHEARMAN & STERLING
127 PUBLIC SQUARE 599 LEXINGTON AVENUE
CLEVELAND, OHIO 44114-1306 NEW YORK, NEW YORK 10022
(216) 689-6300 (212) 848-4000
</TABLE>
------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF SECURITIES TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Form 434,
please check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
===========================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS AMOUNT OFFERING AGGREGATE AMOUNT OF
OF SECURITIES TO BE PRICE OFFERING REGISTRATION
TO BE REGISTERED(1) REGISTERED PER UNIT(3) PRICE(4) FEE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities................................ \ \ \
- ----------------------------------------------- | | |
Debt Warrants.................................. | | |
- ----------------------------------------------- | | |
Preferred Stock, with a par value of $1 each... | | |
- ----------------------------------------------- | | |
Depositary Shares.............................. | | |
- ----------------------------------------------- | | |
Preferred Stock Warrants....................... |--->$1,200,000,000 |-->$1,200,000,000 |---> $413,796
- ----------------------------------------------- | | |
Depositary Share Warrants...................... | | |
- ----------------------------------------------- | | |
Common Shares, with a par value of $1 | | |
each(5)...................................... | | |
- ----------------------------------------------- | | |
Common Share Warrants.......................... | | |
- ----------------------------------------------- | | |
Capital Securities(4).......................... / / /
===========================================================================================================================
</TABLE>
(Footnotes continued on next page)
<PAGE> 2
(Continued from previous page)
(1) This Registration Statement also covers contracts which may be issued by the
Registrant under which the counterparty may be required to purchase Debt
Securities, Preferred Stock or Depositary Shares. Such contracts would be
issued with the Debt Securities, Preferred Stock, Depositary Shares and/or
Warrants covered hereby. In addition, securities registered hereunder may be
sold separately, together or as units with other securities registered
hereunder.
(2) In no event will the aggregate offering price of the Debt Securities, Debt
Warrants, Preferred Stock, Preferred Stock Warrants, Depositary Shares,
Depositary Share Warrants, Common Shares, Common Share Warrants and Capital
Securities issued under this Registration Statement and in the case of
Warrants for which separate consideration is payable upon issuance of
underlying securities, securities issued upon exercise of Warrants, exceed
$1,261,500,000 (including those previously registered under the Securities
Act of 1933, as amended (the "Securities Act")) or the equivalent thereof in
one or more foreign currencies or units of one or more foreign currencies or
companies currencies (such as European Currency Units). The aggregate amount
of Common Shares registered hereunder is further limited to that which is
permissible under Rule 415(a)(4) under the Securities Act. If any securities
are issued at an original issue discount, then additional securities may be
issued so long as the aggregate initial offering price of all such
securities, together with the initial offering price of all other securities
reregistered hereunder or previously registered under the Securities Act,
does not exceed $1,261,500,000.
(3) The proposed maximum offering price per unit will be determined from time to
time by the Registrant in connection with the issuance by the Registrant of
the securities registered hereunder or previously registered under the
Securities Act.
(4) No separate consideration will be received for (i) Common Shares or other
Capital Securities (which may consist of Common Shares or Preferred Stock)
that are issued upon conversion at the option of a holder of Debt
Securities, Preferred Stock or Depositary Shares, or (ii) Capital Securities
or other debt securities that are issued upon conversion at the option of
the Corporation of Debt Securities, Preferred Stock or Depositary Shares.
The proposed maximum aggregate offering price has been estimated solely for
the purpose of computing the registration fee pursuant to Rule 457 of the
Securities Act.
(5) Includes associated rights (the "Rights") to purchase Common Shares. Until
the occurrence of certain prescribed events, none of which has occurred, the
Rights are not exercisable, are evidenced by the certificates representing
the Common Shares and will be transferred along with and only with the
Common Shares.
In accordance with Rule 429 under the Securities Act, the Prospectus
included herein is a combined prospectus which also relates to KeyCorp's
Registration Statement on Form S-3, File No. 33-58405, effective date April 21,
1995, with respect to Debt Securities, Debt Warrants, Preferred Stock,
Depositary Shares, Preferred Stock Warrants, Depositary Share Warrants, Common
Shares, Common Share Warrants and Capital Securities. This Registration
Statement, which is a new Registration Statement on Form S-3, also constitutes a
first post-effective amendment to KeyCorp's Registration Statement on Form S-3,
File No. 33-58405. Such post-effective amendment shall hereafter become
effective concurrently with the effectiveness of this Registration Statement and
in accordance with Section 8(c) of the Securities Act. The aggregate amount of
securities covered by this Registration Statement and the other Registration
Statement referred to above to which the Prospectus contained herein relates
shall not exceed $1,261,500,000.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE AS
MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
<PAGE> 3
PROSPECTUS SUPPLEMENT KEYCORP
(To Prospectus Dated August , 1996)
[LOGO]
$750,000,000
SENIOR MEDIUM-TERM NOTES, SERIES D
SUBORDINATED MEDIUM-TERM NOTES, SERIES C
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
KeyCorp (also referred to herein as the "Corporation") may offer from time to
time its Senior Medium-Term Notes, Series D (the "Senior Notes") and its
Subordinated Medium-Term Notes, Series C (the "Subordinated Notes" and, together
with the Senior Notes, the "Notes") with an aggregate principal amount of up to
U.S. $750,000,000, (or, if any Notes are to be Original Issue Discount Notes,
Foreign Currency Notes or Indexed Notes (as each term is defined under
"Description of Notes"), such principal amount as shall result in an initial
aggregate offering price equivalent to $750,000,000), subject to reduction as a
result of the sale of other Securities (as defined in the accompanying
Prospectus) of the Corporation. See "Plan of Distribution." Each Note will
mature on any day nine months or more from its date of issue, as agreed upon by
the Corporation and the purchaser, and may be subject prior to maturity to
redemption at the option of the Corporation or repayment at the option of the
registered holder. Each Note will bear interest either at a fixed rate (a "Fixed
Rate Note") established by the Corporation at the date of issue of such Note,
which may be zero in the case of certain Original Issue Discount Notes, or at a
floating rate (a "Floating Rate Note"), as set forth therein and specified in
the applicable Pricing Supplement (as defined under "Description of Notes"). A
Fixed Rate Note may pay a level amount in respect of both interest and principal
amortized over the life of the Note (an "Amortizing Note"). The Notes may be
issued as Senior Notes or Subordinated Notes, as set forth in the applicable
Pricing Supplement. Subordinated Notes will be subordinated to all existing and
future Senior Indebtedness and, in certain events involving the insolvency of
the Corporation, to Other Senior Obligations (as defined in the accompanying
Prospectus). See "Description of Debt Securities -- Subordination of
Subordinated Debt Securities" in the accompanying Prospectus.
Unless otherwise specified in the applicable Pricing Supplement, interest on
each Fixed Rate Note will be payable each June 1 and December 1 and at maturity.
Interest on each Floating Rate Note is payable on the dates set forth herein and
in the applicable Pricing Supplement. Unless otherwise specified in the
applicable Pricing Supplement, Amortizing Notes will pay principal and interest
semiannually each June 1 and December 1, or quarterly each March 1, June 1,
September 1 and December 1, and at maturity. See "Description of Notes." Unless
otherwise specified in the applicable Pricing Supplement, the Notes may not be
redeemed by the Corporation or repaid at the option of the holder prior to
maturity. Notes denominated in U.S. dollars will be issued in denominations of
$100,000 or any amount in excess thereof which is an integral multiple of
$1,000. The authorized denominations of Foreign Currency Notes will be set forth
in the applicable Pricing Supplement. Any terms relating to Notes being
denominated in one or more foreign currencies, currency units or composite
currencies ("Specified Currency") ("Foreign Currency Notes") will be set forth
in the applicable Pricing Supplement.
Each Note will be issued only in fully registered form and will be represented
either by a Global Security (as defined in the accompanying Prospectus)
registered in the name of The Depository Trust Company, as depository (the
"Depository") or a nominee thereof (a "Book-Entry Note"), or by a certificate
issued in definitive form (a "Certificated Note"), as set forth in the
applicable Pricing Supplement. Beneficial interests in Global Securities
representing Book-Entry Notes will be shown on, and transfer thereof will be
effected through, the records maintained by the Depository (with respect to
participants' interests) and its participants. Book-Entry Notes will not be
issuable as Certificated Notes except as described under "Description of Debt
Securities -- Book-Entry Procedures" in the accompanying Prospectus.
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 SUPPLEMENT, ANY SUPPLEMENT HERETO OR THE
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE NOTES OFFERED HEREBY ARE NOT DEPOSITS OR SAVINGS ACCOUNTS BUT ARE UNSECURED
DEBT OBLIGATIONS OF KEYCORP AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR INSTRUMENTALITY.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO AGENTS' DISCOUNTS PROCEEDS TO
PUBLIC(1) AND COMMISSIONS(2) CORPORATION(2)(3)
<S> <C> <C> <C>
Per Note............................. 100% .125%-.750% 99.875%-99.250%
Total(4)............................. $750,000,000 $937,500-5,625,000 $749,062,500-$744,375,000
- --------------------------------------------------------------------------------
<FN>
(1) Unless otherwise specified in the applicable Pricing Supplement, Notes will
be sold at 100% of their principal amount. If the Corporation issues any
Note at a discount from or at a premium over its principal amount, the Price
to Public of such Note will be set forth in the applicable Pricing
Supplement. Notes may be resold by the Agents (as defined under "Plan of
Distribution"), acting as principals, at market prices prevailing at the
time of sale, at prices related to such prevailing prices, or at negotiated
prices.
(2) Unless otherwise specified in the applicable Pricing Supplement, with
respect to Notes with a Stated Maturity (as defined under "Description of
Notes -- General") from 9 months to 30 years from the date of issue, the
Corporation will pay a commission to the Agents ranging from .125% to .750%
of the principal amount of each Note. With respect to Notes with a Stated
Maturity that is longer than 30 years from the date of issue sold through
any Agent, the rate of commission will be negotiated at the time of sale and
will be specified in the applicable Pricing Supplement. The Corporation may
also sell Notes to an Agent, as principal, at negotiated discounts, for
resale to investors and other purchasers. The Corporation has agreed to
indemnify each Agent against certain liabilities, including liabilities
under the Securities Act of 1933, as amended.
(3) Before deducting expenses payable by the Corporation estimated to be
$851,796.
(4) Or the equivalent thereof, if any of the Notes are denominated other than in
U.S. dollars.
</TABLE>
The Notes are being offered by the Corporation on a continuous basis through the
Agents, each of which has agreed to use its reasonable efforts to solicit offers
to purchase Notes. The Corporation may also sell Notes to an Agent acting as
principal for its own account or for resale to one or more investors and other
purchasers at varying prices related to prevailing market prices at the time of
resale or, if so agreed, at a fixed public offering price. No termination date
for the offering of the Notes has been established. The Corporation or an Agent
may reject any offer in whole or in part. The Corporation reserves the right to
withdraw, cancel or modify the offer made hereby without notice. The Corporation
reserves the right to sell Notes directly on its own behalf and accept (but not
solicit) offers to purchase Notes through additional agents on substantially the
same terms and conditions (including commission rates) as would apply to
purchases of Notes by or through the Agents. The Notes will not be listed on any
securities exchange, and there can be no assurance that the Notes offered hereby
will be sold or that there will be a secondary market for the Notes. See "Plan
of Distribution."
SALOMON BROTHERS INC CHASE SECURITIES INC.
CS FIRST BOSTON CITICORP SECURITIES, INC.
GOLDMAN, SACHS & CO. J.P. MORGAN & CO.
The date of this Prospectus Supplement is August , 1996.
<PAGE> 4
IN CONNECTION WITH THIS OFFERING MADE PURSUANT TO THIS PROSPECTUS
SUPPLEMENT AND THE APPLICABLE PRICING SUPPLEMENT, THE AGENTS MAY OVER-ALLOT OR
EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES
OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
SELECTED CONSOLIDATED FINANCIAL DATA
The following table presents summary consolidated financial data which has
been derived from, and should be read in conjunction with, the consolidated
financial statements of the Corporation and notes thereto and the financial
information with respect to the Corporation incorporated by reference into the
accompanying Prospectus. This summary is qualified in its entirety by the
detailed information and financial statements included in the documents
incorporated by reference under "Incorporation of Certain Documents by
Reference" in the accompanying Prospectus. The data presented for the six-month
periods ended June 30, 1996 and June 30, 1995 are not necessarily indicative of
the data for the entire year and have been derived from unaudited consolidated
financial statements of the Corporation. The comparability of the data presented
is affected by certain acquisitions and divestitures that KeyCorp has completed
in the time periods presented. These financial statements include, in the
opinion of management, all adjustments of a normal recurring nature which are
necessary to present fairly the data for such interim periods.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
------------------ ---------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------- ------- ------- ------- ------- ------- -------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
FOR THE PERIOD
Interest income.................... $ 2,470 $ 2,544 $ 5,121 $ 4,490 $ 4,214 $ 4,199 $ 4,652
Interest expense................... 1,119 1,234 2,485 1,797 1,535 1,750 2,519
Net interest income................ 1,351 1,310 2,636 2,693 2,679 2,449 2,133
Provision for loan losses.......... 91 39 100 125 212 338 466
Noninterest income................. 513 394 933 883 1,002 925 849
Noninterest expense................ 1,149 1,129 2,312 2,168 2,385 2,171 2,066
Income before income taxes and
extraordinary item............... 624 536 1,157 1,283 1,084 865 450
Income before extraordinary item... 425 373 789 853 710 592 314
Net income......................... 425 409 825 853 710 592 314
Net income applicable to Common
Shares........................... 417 401 809 837 692 568 298
PER COMMON SHARE
Income before extraordinary item... $ 1.80 $ 1.54 $ 3.30 $ 3.45 $ 2.89 $ 2.42 $ 1.31
Net income......................... 1.80 1.69 3.45 3.45 2.89 2.42 1.31
Cash dividends..................... .76 .72 1.44 1.28 1.12 .98 .92
Book value at period-end........... 21.63 19.71 21.36 18.88 17.53 15.64 14.10
Market Price:
High........................... 40.25 32.13 37.25 33.75 37.25 33.44 26.25
Low............................ 33.38 24.50 24.50 23.63 27.25 24.25 15.25
Close.......................... 38.75 31.38 36.25 25.00 29.75 32.13 24.75
Weighted average Common Shares
(000)............................ 232,220 237,651 234,787 243,067 239,775 235,005 227,116
AT PERIOD-END
Loans.............................. $47,826 $48,093 $47,692 $46,225 $40,071 $36,022 $35,534
Earning assets..................... 57,404 60,946 58,762 60,047 54,353 49,381 48,208
Total assets....................... 64,764 67,481 66,339 66,801 59,634 55,068 53,601
Deposits........................... 44,417 48,672 47,282 48,564 46,499 43,433 42,835
Long-term debt..................... 4,174 4,020 4,003 3,570 1,764 1,790 1,225
Common shareholders' equity........ 4,996 4,514 4,993 4,530 4,226 3,683 3,272
Total shareholders' equity......... 4,996 4,674 5,153 4,690 4,386 3,927 3,516
</TABLE>
S-2
<PAGE> 5
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
------------------ ---------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------- ------- ------- ------- ------- ------- -------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS AND PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C> <C>
PERFORMANCE RATIOS
Return on average total
assets(1)........................ 1.32% 1.24% 1.24% 1.36% 1.24% 1.13% .60%
Return on average common
equity(1)........................ 16.78 17.55 17.35 18.87 17.27 16.33 9.29
Return on average total
equity(1)........................ 16.58 17.30 17.10 18.56 16.95 15.91 9.31
Efficiency(2)...................... 60.86 63.58 63.03 59.39 60.50 60.96 65.27
Overhead(3)........................ 46.29 51.72 49.66 46.14 46.85 47.21 52.63
Net interest margin(1)(TE)......... 4.75 4.44 4.47 4.83 5.31 5.31 4.71
CAPITAL RATIOS AT PERIOD-END
Equity to assets................... 7.71% 6.93% 7.77% 7.03% 7.37% 7.13% 6.56%
Tangible equity to tangible
assets........................... 6.27 5.75 6.25 6.19 6.51 6.11 5.45
Tier I risk-adjusted capital....... 7.60 7.45 7.53 8.48 8.73 8.56 7.67
Total risk-adjusted capital........ 11.72 10.82 10.85 11.62 12.22 11.73 9.80
Leverage........................... 6.43 5.88 6.20 6.63 6.72 6.56 5.97
ASSET QUALITY DATA
Nonperforming loans................ $ 326 $ 311 $ 333 $ 256 $ 336 $ 553 $ 730
Nonperforming assets............... 371 366 379 340 500 900 1,072
Allowance for loan losses.......... 870 867 876 830 803 783 794
Net loan charge-offs............... 89 38 99 109 213 361 392
Nonperforming loans to period-end
loans............................ .68% .65% .70% .55% .84% 1.53% 2.05%
Nonperforming assets to period-end
loans plus OREO and other
nonperforming assets............. .77 .76 .79 .73 1.24 2.47 2.99
Allowance for loan losses to
nonperforming loans.............. 266.87 278.88 263.15 324.27 238.69 141.54 108.79
Allowance for loan losses to
period-end loans................. 1.82 1.80 1.84 1.80 2.00 2.17 2.23
Net loan charge-offs to average
loans............................ .37 .16 .21 .26 .56 1.02 1.11
RATIO OF EARNINGS TO FIXED CHARGES(4)
Excluding deposit interest......... 2.62x 2.34x 2.42x 3.50x 4.15x 3.67x 2.07x
Including deposit interest......... 1.55x 1.43x 1.46x 1.70x 1.69x 1.48x 1.18x
- ---------------
<FN>
(1) Annualized.
(2) Calculated as noninterest expense (excluding merger and integration charges
and certain other nonrecurring charges) divided by taxable-equivalent net
interest income plus noninterest income (excluding net securities gains
(losses) and gains on certain asset sales).
(3) Calculated as noninterest expense (excluding merger and integration charges
and certain other nonrecurring charges) less noninterest income (excluding
net securities gains (losses) and gains on certain asset sales) divided by
taxable-equivalent net interest income.
(4) Earnings represent consolidated income before income taxes and extraordinary
item plus fixed charges. Fixed charges include consolidated interest expense
(excluding or including interest on deposits, as the case may be) and the
proportion deemed representative of the interest factor of rental expense,
net of income from subleases.
TE = Taxable Equivalent.
</TABLE>
S-3
<PAGE> 6
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of the Debt Securities set forth
under the heading "Description of Debt Securities" in the accompanying
Prospectus, to which reference is hereby made. The particular terms of the Notes
sold pursuant to any pricing supplement (a "Pricing Supplement") will be
described therein. The terms and conditions set forth in this "Description of
Notes" will apply to each Note unless otherwise specified in the applicable
Pricing Supplement and in such Note. Capitalized terms not defined herein shall
have the same meanings assigned to such terms in the Prospectus or the
Applicable Indenture (as defined in the accompanying Prospectus). Reference
herein to "U.S. dollars" or "U.S. $" or "$" are to the currency of the United
States of America.
GENERAL
The Notes offered hereby, if Senior Debt Securities, will be issued under
the Senior Indenture, as amended or supplemented. Notes issued under the Senior
Indenture will rank equally with all other unsecured and unsubordinated
indebtedness of the Corporation which is not accorded a priority under
applicable law. Notes issued under the Subordinated Indenture will be
subordinated in right of payment to the prior payment in full of the Senior
Indebtedness of the Corporation and, in certain events involving the insolvency
of the Corporation, Other Senior Obligations of the Corporation. See
"Description of Debt Securities -- Subordination of Subordinated Debt
Securities" in the accompanying Prospectus. As of June 30, 1996, the Corporation
had outstanding approximately $1.0 billion aggregate principal amount of Senior
Indebtedness and $296.0 million of Other Senior Obligations.
The Notes will be offered on a continuous basis. The Notes offered by this
Prospectus Supplement issued under the Applicable Indenture will constitute all
or part of a single series for purposes of such Indenture. The Notes of such
series offered hereby are limited to an aggregate initial offering price of
U.S.$750.0 million subject to reduction as a result of the sale by the
Corporation of other Securities referred to in the accompanying Prospectus. See
"Plan of Distribution." For purposes of this Prospectus Supplement, (i) the
principal amount of any Original Issue Discount Note means the Issue Price (as
defined below) of such Note and (ii) the principal amount of any Note issued in
the Specified Currency means the U.S. dollar equivalent on the date of issue of
the Issue Price of such Note.
Each Note will mature on any day nine months or more from its date of
issue, as selected by the initial purchaser and agreed to by the Corporation
(the "Stated Maturity") which date may be subject to extension at the option of
the Corporation (subject to applicable regulatory approval in the case of
subordinated Notes) or the holder, and may be subject to redemption at the
option of the Corporation or repayment at the option of the holder prior to its
Stated Maturity as specified in the applicable Pricing Supplement. See "Optional
Redemption" and "Repayment at the Noteholder's Option" below.
Each Note will be issued initially as either a Book-Entry Note or a
Certificated Note. Except as set forth under "Description of Debt
Securities -- Book-Entry Procedures" in the accompanying Prospectus, Book-Entry
Notes will not be issuable as Certificated Notes. See "Book-Entry System" below.
Unless otherwise specified in the applicable Pricing Supplement, the Notes
will be denominated in U.S. dollars and payments of principal and any premium,
and interest on the Notes will be made in U.S. dollars. Except as specified for
Notes not denominated in U.S. dollars, or as otherwise provided in the
applicable Pricing Supplement, the Notes will be issued only in fully registered
form in denominations of U.S.$100,000 or any amount in excess thereof which is
an integral multiple of U.S.$1,000. If any of the Notes are to be denominated in
a Specified Currency other than U.S. dollars, additional information pertaining
to the terms of such Notes and other matters relevant to the holders thereof
will be described in the applicable Pricing Supplement.
The Notes may be issued as Original Issue Discount Notes (including Zero
Coupon Notes, as defined below) as indicated in the applicable Pricing
Supplement. An "Original Issue Discount Note" means any Note that provides for
an amount less than the entire principal amount thereof to be payable upon
declaration
S-4
<PAGE> 7
of acceleration of the maturity thereof pursuant to the Applicable Indenture.
See "United States Tax Considerations -- Original Issue Discount and Acquisition
Discount and Foreign Currency Notes" below.
The Notes may be issued as Indexed Notes, Amortizing Notes, Renewable Notes
and Extendible Notes, as indicated in the applicable Pricing Supplement. See
"Indexed Notes," "Fixed Rate Notes -- Amortizing Notes," "Renewable Notes" and
"Extension of Maturity" below.
The Pricing Supplement relating to each Note will specify the price
(expressed as a percentage of the aggregate principal amount thereof) at which
such Note will be issued if other than 100% (the "Issue Price"), the principal
amount, the interest rate or interest rate formula, ranking, maturity, currency,
(including one or more foreign currencies, currency units or composite
currencies), any redemption or repayment provisions and any other terms on which
each such Note will be issued that are not inconsistent with the provisions of
the Applicable Indenture.
Unless otherwise specified in the applicable Pricing Supplement, the Notes,
except for Amortizing Notes, will not be subject to any sinking fund.
The Notes may be presented for payment of principal and interest, transfer
of the Notes will be registrable, and the Notes will be exchangeable, at KeyBank
National Association, as paying agent (the "Paying Agent") in The City of
Cleveland; provided that Book-Entry Notes will be exchangeable only in the
manner and to the extent set forth below under "Description of Debt
Securities -- Book-Entry Procedures" in the accompanying Prospectus.
As used herein, "Business Day" shall mean any day other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which banking institutions
are generally authorized or required by law or regulation to close in The City
of New York and (i) in respect of LIBOR Notes (as defined below), in the city of
London, (ii) with respect to Notes denominated or payable in a Specified
Currency other than ECUs in the financial center of the country issuing the
Specified Currency, (iii) with respect to Notes denominated or payable in ECUs,
in the financial center of each country that issues a component currency of the
ECU, and that is not a non-ECU settlement day. "London Banking Day" shall mean
any day on which dealings in deposits in U.S. dollars are transacted in the
London interbank market.
As used herein, an "Interest Payment Date" with respect to any Note shall
be a date on which, under the terms of such Note, regularly scheduled interest
shall be payable. Unless otherwise specified in the applicable Pricing
Supplement, the "Record Date" with respect to any Interest Payment Date shall be
the date 15 calendar days (whether or not such date is a Business Day) prior to
such Interest Payment Date.
Unless otherwise specified in the applicable Pricing Supplement, KeyBank
National Association will act as Authenticating Agent for the Notes pursuant to
an appointment by the Trustee. Unless otherwise specified in the applicable
Pricing Supplement, KeyBank National Association will also act as Registrar for
the Notes pursuant to an appointment by the Trustee. Prior to December 31, 1996,
the debt services business of KeyBank National Association will be transferred
to an affiliated bank of Mellon Bank Corporation as successor in interest.
Accordingly, beginning at the time of the transfer, an affiliated bank of Mellon
Bank Corporation will act as Authenticating Agent, Registrar and Paying Agent
for the Notes. Until the transfer, processing will be handled on behalf of
KeyBank National Association by the debt services unit of Mellon Bank F.S.B.
PAYMENT CURRENCY AND CURRENCY EXCHANGE INFORMATION
Purchasers are required to pay for Notes denominated in a Specified
Currency in such Specified Currency, and payments of principal, premium, if any,
and interest on such Notes will be made in such Specified Currency, unless
otherwise provided in the applicable Pricing Supplement. Currently, there are
limited facilities in the United States for the conversion of U.S. dollars into
foreign currencies and vice versa. In addition, most banks do not currently
offer non-U.S. dollar-denominated checking or savings account facilities in the
United States. Accordingly, unless otherwise specified in the applicable Pricing
Supplement, or unless alternative arrangements are made, payment of principal,
premium, if any, and interest on Notes in a Specified Currency other than U.S.
dollars will be made to an account at a bank outside the United States.
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<PAGE> 8
If the applicable Pricing Supplement provides for payments of principal of,
premium, if any, and interest on a non-U.S. dollar-denominated Note to be made
in U.S. dollars or for payments of principal of, premium, if any, and interest
on a U.S. dollar-denominated Note to be made in a Specified Currency other than
U.S. dollars, the conversion of the Specified Currency into U.S. dollars or U.S.
dollars into the Specified Currency, as the case may be, will be handled by the
Exchange Rate Agent identified in the applicable Pricing Supplement. The costs
of such conversion will be borne by the holder of such Note through deductions
from such payments.
If the applicable Pricing Supplement provides for payments of principal of,
premium, if any, and interest on a non-U.S. dollar-denominated Note to be made,
at the option of the holder of such Note, in U.S. dollars, conversion of the
Specified Currency into U.S. dollars will be based on the highest bid quotation
in The City of New York received by the Exchange Rate Agent at approximately
11:00 A.M., New York City time, on the second Business Day preceding the
applicable payment date from three recognized foreign exchange dealers selected
by the Exchange Rate Agent (one of which may be the Exchange Rate Agent unless
the Exchange Rate Agent is the applicable Agent) for the purchase by the quoting
dealer of the Specified Currency for U.S. dollars for settlement on such payment
date in the aggregate amount of the Specified Currency payable to the holders of
Notes and at which the applicable dealer commits to execute a contract. If none
of such bid quotations are available, payments will be made in the Specified
Currency. All currency exchange costs will be borne by the holders of Notes by
deductions from such payments.
Except as set forth below, if the principal of, premium, if any, or
interest on, any Note is payable in a Specified Currency other than U.S. dollars
and such Specified Currency is not available to the Corporation for making
payments thereof due to the imposition of exchange controls or other
circumstances beyond the control of the Corporation or is no longer used by the
government of the country issuing such currency or for the settlement of
transactions by public institutions within the international banking community,
then the Corporation will be entitled to satisfy its obligations to holders of
the Notes by making such payments in U.S. dollars on the basis of the Market
Exchange Rate on the date of such payment or, if the Market Exchange Rate is not
available on such date, as of the most recent practicable date. Any payment made
under such circumstances in U.S. dollars where the required payment is in a
Specified Currency other than U.S. dollars will not constitute an Event of
Default or Default under the Applicable Indenture.
If payment in respect of a Note is required to be made in ECUs and ECUs are
unavailable due to the imposition of exchange controls or other circumstances
beyond the Corporation's control or are no longer used in the European Monetary
System, then all payments in respect of such Note shall be made in U.S. dollars
until ECUs are again available or so used. The amount of each payment in U.S.
dollars shall be computed on the basis of the equivalent of the ECU in U.S.
dollars, determined as described below, as of the second Business Day prior to
the date on which such payment is due.
The equivalent of the ECU in U.S. dollars as of any date shall be
determined by the Corporation or its agent on the following basis. The component
currencies of the ECU for this purpose (the "Components") shall be the currency
amounts that were components of the ECU as of the last date on which the ECU was
used in the European Monetary System. The equivalent of the ECU in U.S. dollars
shall be calculated by aggregating the U.S. dollar equivalents of the
Components. The U.S. dollar equivalent of each of the Components shall be
determined by the Corporation or such agent on the basis of the most recently
available Market Exchange Rates for such Components.
If the official unit of any Component is altered by way of combination or
subdivision, the number of units of that currency as a Component shall be
divided or multiplied in the same proportion. If two or more Components are
consolidated into a single currency, the amounts of those currencies as
Components shall be replaced by an amount in such single currency equal to the
sum of the appropriate amounts of the consolidated component currencies
expressed in such single currency. If any Component is divided into two or more
currencies, the amount of the original component currency shall be replaced by
the appropriate amounts of such two or more currencies, the sum of which shall
be equal to the amount of the original component currency.
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<PAGE> 9
All determinations referred to above made by the Corporation or its agent
shall be at the Corporation's sole discretion and shall, in the absence of
manifest error, be conclusive for all purposes and binding on holders of Notes.
INTEREST AND PRINCIPAL PAYMENTS
Interest will be payable to the person in whose name the Note is registered
at the close of business on the applicable Record Date; provided that the
interest payable upon maturity, redemption or repayment (whether or not the date
of maturity, redemption or repayment is an Interest Payment Date) will be
payable to the person to whom principal is payable. Unless otherwise specified
in the applicable Pricing Supplement, the initial interest payment on a Note
will be made on the first Interest Payment Date falling after the date the Note
is issued; provided, however, that payments of interest (or, in the case of an
Amortizing Note, principal and interest) on a Note issued less than 15 calendar
days before an Interest Payment Date will be paid on the next succeeding
Interest Payment Date to the holder of record on the Record Date with respect to
such succeeding Interest Payment Date, unless otherwise specified in the
applicable Pricing Supplement.
U.S. dollar payments of interest, other than interest payable at maturity
(or on the date of redemption or repayment, if a Note is redeemed or repaid
prior to maturity), will be made by check mailed to the address of the person
entitled thereto as shown on the Note register. U.S. dollar payments of
principal, premium, if any, and interest upon maturity, redemption or repayment
will be made in immediately available funds against presentation and surrender
of the Note. Notwithstanding the foregoing, (a) the Depository, as holder of
Book-Entry Notes, shall be entitled to receive payments of interest by wire
transfer of immediately available funds and (b) a holder of U.S.$1.0 million (or
the equivalent) or more in aggregate principal amount of Certificated Notes
(whether having identical or different terms and provisions) shall be entitled
to receive payments of interest by wire transfer of immediately available funds
upon written request to the Paying Agent not later than 15 calendar days prior
to the applicable Interest Payment Date.
Notwithstanding the foregoing, unless otherwise specified in the applicable
Pricing Supplement, a holder of a Foreign Currency Note may elect to receive
payment of the principal of and any premium and interest on such Note in the
Specified Currency by transmitting a written request for such payment to the
Trustee at its Corporate Trust Office in the Borough of Manhattan, The City of
New York, or the Paying Agent on or prior to the Record Date in the case of an
interest payment or at least 15 calendar days prior to the Stated Maturity in
the case of a principal or premium payment. Such request may be in writing with
a signature guarantee, (mailed or hand delivered), or by cable, telex or other
form of facsimile transmission. A holder of a Foreign Currency Note may elect to
receive payment in the Specified Currency for all principal and any premium and
interest payments and need not file a separate election for each payment. Such
election will remain in effect until revoked by written notice to the Trustee,
but written notice of any such revocation must be received by the Trustee on or
prior to the relevant Record Date or at least 15 calendar days prior to the
Stated Maturity, as the case may be. Holders of Foreign Currency Notes whose
Notes are to be held in the name of a broker or nominee should contact such
broker or nominee to determine whether and how an election to receive payments
in the Specified Currency may be made.
Unless otherwise specified in the applicable Pricing Supplement, a
beneficial owner of Book-Entry Notes denominated in a Specified Currency
electing to receive payments of principal or any premium or interest in the
Specified Currency must notify the Participant through which its interest is
held on or prior to the applicable Record Date, in the case of a payment of
interest, and on or prior to the 15th calendar day prior to the Stated Maturity,
in the case of payment of principal or premium, of such beneficial owner's
election to receive all or a portion of such payment in a Specified Currency.
Such Participant must notify the Depository of such election on or prior to the
third Business Day after such Regular Record Date. The Depository will notify
the Paying Agent of such election on or prior to the fifth Business Day after
such Regular Record Date. If complete instructions are received by the
Participant and forwarded by the Participant to the Depository, and by the
Depository to the Paying Agent, on or prior to such dates, the beneficial owner
will receive payments in the Specified Currency.
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<PAGE> 10
Unless otherwise specified in the applicable Pricing Supplement or unless
alternative arrangements are made, payments of principal, premium, if any, and
interest on Notes in a Specified Currency other than U.S. dollars will be made
by wire transfer of immediately available funds to an account maintained by the
payee with a bank located outside the United States if the holder of such Notes
provides the Paying Agent with the appropriate wire transfer instructions not
later than 15 calendar days prior to the applicable payment date. If such wire
transfer instructions are not so provided, payments of principal, premium, if
any, and interest on such Notes will be made by check payable in such Specified
Currency mailed to the address of the Person entitled thereto as such address
shall appear in the Note register.
Certain Notes, including Original Issue Discount Notes, may be considered
to be issued with original issue discount, which must be included in income for
United States federal income tax purposes at a constant rate. See "United States
Tax Considerations -- Original Issue Discount and Acquisition Discount" below.
Unless otherwise specified in the applicable Pricing Supplement, if the
principal of any Original Issue Discount Note is declared to be due and payable
immediately as described under "Description of Debt Securities -- Events of
Default" in the accompanying Prospectus, the amount of principal due and payable
with respect to such Note shall be limited to the aggregate principal amount of
such Note multiplied by the sum of its Issue Price (expressed as a percentage of
the aggregate principal amount) plus the original issue discount amortized from
the date of issue to the date of declaration, which amortization shall be
calculated using the "interest method" (computed in accordance with generally
accepted accounting principles in effect on the date of declaration). Special
considerations applicable to any such Notes will be set forth in the applicable
Pricing Supplement.
FIXED RATE NOTES
Each Fixed Rate Note will bear interest from the date of issuance at the
annual rate stated on the face thereof, except as described below under
"Extension of Maturity" or "Renewable Notes," until the principal thereof is
paid or made available for payment. Unless otherwise specified in the applicable
Pricing Supplement, such interest will be computed on the basis of a 360-day
year of twelve 30-day months. Unless otherwise specified in the applicable
Pricing Supplement, payments of interest on Fixed Rate Notes other than
Amortizing Notes will be made semiannually on each June 1 and December 1 and at
maturity or upon any earlier redemption or repayment.
If any Interest Payment Date for any Fixed Rate Note would fall on a day
that is not a Business Day, the interest payment shall be postponed to the next
day that is a Business Day, and no interest on such payment shall accrue for the
period from and after the Interest Payment Date. If the maturity date (or date
of redemption or repayment) of any Fixed Rate Note would fall on a day that is
not a Business Day, the payment of principal, premium, if any, and interest may
be made on the next succeeding Business Day, and no interest on such payment
shall accrue for the period from and after the maturity date (or date of
redemption or repayment).
Interest payments for Fixed Rate Notes will include accrued interest from
the date of issue or from the last date in respect of which interest has been
paid or duly provided for, as the case may be, to, but excluding, the Interest
Payment Date or the date of maturity or earlier redemption or repayment, as the
case may be.
Amortizing Notes
Unless otherwise specified in the applicable Pricing Supplement, payments
of principal and interest on Amortizing Notes, which are securities on which
payments of principal and interest are made in equal installments over the life
of the security, will be made either quarterly on each March l, June 1,
September 1 and December 1 or semiannually on each June l and December 1, as set
forth in the applicable Pricing Supplement, and at maturity or upon any earlier
redemption or repayment. Payments with respect to Amortizing Notes will be
applied first to interest due and payable thereon and then to the reduction of
the unpaid principal amount thereof. A table setting forth repayment information
in respect of each Amortizing Note will be provided to the original purchaser
and will be available, upon request, to subsequent holders.
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FLOATING RATE NOTES
Each Floating Rate Note will bear interest from the date of issuance until
the principal thereof is paid or made available for payment at a rate determined
by reference to an interest rate basis (the "Base Rate"), which may be adjusted
by a Spread and/or Spread Multiplier (each as defined below). The applicable
Pricing Supplement will designate one or more of the following Base Rates as
applicable to each Floating Rate Note: (a) the CD Rate (a "CD Rate Note"), (b)
the Commercial Paper Rate (a "Commercial Paper Rate Note"), (c) the Federal
Funds Rate (a "Federal Funds Rate Note"), (d) LIBOR (a "LIBOR Note"), (e) the
Prime Rate (a "Prime Rate Note"), (f) the Treasury Rate (a "Treasury Rate
Note"), (g) the CMT Rate (a "CMT Rate Note"), (h) the 11th District Cost of
Funds Rate (an "11th District Cost of Funds Rate Note") or (i) such other Base
Rate as is set forth in such Pricing Supplement and in such Floating Rate Note.
The "Index Maturity" for any Floating Rate Note is the period of maturity of the
instrument or obligation from which the Base Rate is calculated and will be
specified in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
interest rate on each Floating Rate Note will be calculated by reference to the
specified Base Rate (i) plus or minus the Spread, if any, and/or (ii) multiplied
by the Spread Multiplier, if any. The "Spread" is the number of basis points
(one one-hundredth of a percentage point) specified in the applicable Pricing
Supplement to be added to or subtracted from the Base Rate for such Floating
Rate Note, and the "Spread Multiplier" is the percentage specified in the
applicable Pricing Supplement to be applied to the Base Rate for such Floating
Rate Note.
As specified in the applicable Pricing Supplement, a Floating Rate Note may
also have either or both of the following: (i) a maximum limitation, or ceiling,
on the rate of interest which may accrue during any interest period ("Maximum
Interest Rate"); and (ii) a minimum limitation, or floor, on the rate of
interest which may accrue during any interest period ("Minimum Interest Rate").
In addition to any Maximum Interest Rate that may be applicable to any Floating
Rate Note pursuant to the above provisions, the interest rate on a Floating Rate
Note will in no event be higher than the maximum rate permitted by New York law,
as the same may be modified by United States law of general application.
Unless otherwise specified in the applicable Pricing Supplement, the rate
of interest on each Floating Rate Note will be reset daily, weekly, monthly,
quarterly, semiannually or annually (such period being the "Interest Reset
Period" for such Note, and the first day of each Interest Reset Period being an
"Interest Reset Date"), as specified in the applicable Pricing Supplement.
Unless otherwise specified in the Pricing Supplement, the Interest Reset Date
will be, in the case of Floating Rate Notes which reset daily, each Business
Day; in the case of Floating Rate Notes (other than Treasury Rate Notes) which
reset weekly, the Wednesday of each week; in the case of Treasury Rate Notes
which reset weekly, the Tuesday of each week, except as provided below; in the
case of Floating Rate Notes which reset monthly, the third Wednesday of each
month; in the case of Floating Rate Notes which reset quarterly, the third
Wednesday of March, June, September and December; in the case of Floating Rate
Notes which reset semiannually, the third Wednesday of two months of each year,
as specified in the applicable Pricing Supplement; and in the case of Floating
Rate Notes which reset annually, the third Wednesday of one month of each year,
as specified in the applicable Pricing Supplement; provided, however, that the
interest rate in effect from the date of issue to the first Interest Reset Date
with respect to a Floating Rate Note will be the initial interest rate set forth
in the applicable Pricing Supplement (the "Initial Interest Rate"). If any
Interest Reset Date for any Floating Rate Note would otherwise be a day that is
not a Business Day, such Interest Reset Date shall be postponed to the next
succeeding Business Day, except that in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the next preceding Business Day.
Except as provided below and unless otherwise specified in the applicable
Pricing Supplement, interest on Floating Rate Notes will be payable: (i) in the
case of Floating Rate Notes with a daily, weekly or monthly Interest Reset Date
(other than the 11th District Cost of Funds Rate Notes), on the third Wednesday
of each month or on the third Wednesday of March, June, September and December,
or in the case of the 11th District Cost of Funds Rate Notes, all of which reset
monthly, the first calendar day of each month, as specified in the applicable
Pricing Supplement; (ii) in the case of Floating Rate Notes with a quarterly
Interest Reset Date, on the third Wednesday of March, June, September and
December; (iii) in the case of
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<PAGE> 12
Floating Rate Notes with a semiannual Interest Reset Date, on the third
Wednesday of the two months specified in the applicable Pricing Supplement; and
(iv) in the case of Floating Rate Notes with an annual Interest Reset Date, on
the third Wednesday of the month specified in the applicable Pricing Supplement
and, in each case, at maturity. If any Interest Payment Date for any Floating
Rate Note would fall on a day that is not a Business Day with respect to such
Floating Rate Note, such Interest Payment Date will be the following day that is
a Business Day with respect to such Floating Rate Note, except that, in the case
of a LIBOR Note, if such Business Day is in the next succeeding calendar month,
such Interest Payment Date shall be the immediately preceding day that is a
Business Day with respect to such LIBOR Note. If the maturity date or any
earlier redemption or repayment date of a Floating Rate Note would fall on a day
that is not a Business Day, the payment of principal, premium, if any, and
interest will be made on the next succeeding Business Day, and no interest on
such payment shall accrue for the period from and after such maturity,
redemption or repayment date, as the case may be.
Unless otherwise specified in the applicable Pricing Supplement, interest
payments for Floating Rate Notes shall be the amount of interest accrued from,
and including, the date of issue or from, and including, the last date to which
interest has been paid to or duly provided for, to, but excluding, the Interest
Payment Date.
With respect to a Floating Rate Note, accrued interest shall be calculated
by multiplying the principal amount of such Floating Rate Note by an accrued
interest factor. Such accrued interest factor will be computed by adding the
interest factors calculated for each day in the period for which interest is
being paid. Unless otherwise specified in the applicable Pricing Supplement, the
interest factor for each such day is computed by dividing the interest rate
applicable to such day by 360, in the case of CD Rate Notes, Commercial Paper
Rate Notes, Federal Funds Rate Notes, LIBOR Notes, the 11th District Cost of
Funds Rate Notes and Prime Rate Notes or by the actual number of days in the
year, in the case of CMT Rate Notes and Treasury Rate Notes.
The interest rate in effect on any Interest Reset Date will be the
applicable rate as reset on such date. The interest rate applicable to any other
day is the interest rate from the immediately preceding Interest Reset Date (or,
if none, the Initial Interest Rate).
All percentages used in or resulting from any calculation of the rate of
interest on a Floating Rate Note will be rounded, if necessary, to the nearest
one hundred-thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward, and all dollar amounts used in or resulting
from such calculation on Floating Rate Notes will be rounded to the nearest
cent, with one-half cent rounded upward.
Unless otherwise specified in the applicable Pricing Supplement, KeyBank
National Association will be the calculation agent (the "Calculation Agent")
with respect to any issue of Floating Rate Notes. Upon the request of the holder
of any Floating Rate Note, the Calculation Agent will provide the interest rate
then in effect and, if determined, the interest rate that will become effective
on the next Interest Reset Date with respect to such Floating Rate Note.
Unless otherwise specified in the applicable Pricing Supplement, the
"Interest Determination Date" pertaining to an Interest Reset Date for CD Rate
Notes, Commercial Paper Rate Notes, Federal Funds Rate Notes, CMT Rate Notes and
Prime Rate Notes will be the second Business Day next preceding such Interest
Reset Date. The Interest Determination Date pertaining to an Interest Reset Date
for an 11th District Cost of Funds Rate Note (the "11th District Cost of Funds
Rate Interest Determination Date") will be the last working day of the month
immediately preceding such Interest Reset Date on which the Federal Home Loan
Bank of San Francisco (the "FHLB of San Francisco") publishes the Index (as
defined below under "-- 11th District Cost of Funds Rate Notes"). The Interest
Determination Date pertaining to an Interest Reset Date for a LIBOR Note will be
the second London Banking Day preceding such Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date for a Treasury Rate Note
will be the day of the week in which such Interest Reset Date falls on which
Treasury bills would normally be auctioned. Treasury bills are normally sold at
auction on Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday, but such auction may
be held on the preceding Friday. If, as the result of a legal holiday, an
auction is so held on the preceding Friday, such Friday will be the Interest
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<PAGE> 13
Determination Date pertaining to the Interest Reset Date occurring in the next
succeeding week. If an auction falls on a day that is an Interest Reset Date,
such Interest Reset Date will be the next following Business Day.
Unless otherwise specified in the applicable Pricing Supplement, the
"Calculation Date", where applicable, pertaining to an Interest Determination
Date will be the earlier of (i) the 10th calendar day after such Interest
Determination Date or, if any such day is not a Business Day, the next
succeeding Business Day or, (ii) the Business Day preceding the applicable
Interest Payment Date or Stated Maturity, as the case may be.
Interest rates will be determined (which determination, in the absence of
manifest error, will be conclusive and binding) by the Calculation Agent as
follows:
CD Rate Notes
CD Rate Notes will bear interest at the interest rate (calculated with
reference to the CD Rate and the Spread and/or Spread Multiplier, if any, and
subject to the Minimum Interest Rate and the Maximum Interest Rate, if any)
specified in the CD Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "CD Rate"
means, with respect to any Interest Determination Date, the rate on such date
for negotiable certificates of deposit having the Index Maturity designated in
the applicable Pricing Supplement as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates," or any successor publication of the Board of Governors of the Federal
Reserve System ("H.15(519)") under the heading "CDs (Secondary Market)" (or any
other heading that is the then applicable heading established to describe such
Index Maturity). However, if not so published by 9:00 A.M., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, the CD
Rate will be the rate on such Interest Determination Date for negotiable
certificates of deposit of the Index Maturity designated in the applicable
Pricing Supplement as published by the Federal Reserve Bank of New York in its
daily statistical release "Composite 3:30 P.M. Quotations for U.S. Government
Securities" (the "Composite Quotations") under the heading "Certificates of
Deposit." If such rate is not yet published in either H.15(519) or the Composite
Quotations by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the CD Rate on such Interest Determination
Date will be calculated by the Calculation Agent and will be the arithmetic mean
of the secondary market offered rates as of 10:00 A.M., New York City time, on
such Interest Determination Date for certificates of deposit in the denomination
of $5,000,000 with a remaining maturity closest to the Index Maturity designated
in the Pricing Supplement of three leading nonbank dealers in negotiable U.S.
dollar certificates of deposit in The City of New York (which may include one or
more of the Agents) selected by the Calculation Agent for negotiable
certificates of deposit of major United States money center banks of the highest
credit standing in the market for negotiable certificates of deposit; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting as set forth above, the CD Rate in effect for the applicable period
will be the same as the CD Rate for the immediately preceding Interest Reset
Period (or, if there was no such Interest Rate Period, the rate of interest
payable on the CD Rate Notes for which such CD Rate is being determined shall be
the Initial Interest Rate).
Commercial Paper Rate Notes
Commercial Paper Rate Notes will bear interest at the interest rate
(calculated with reference to the Commercial Paper Rate and the Spread and/or
Spread Multiplier, if any, and subject to the Minimum Interest Rate and the
Maximum Interest Rate, if any) specified in the Commercial Paper Rate Notes and
in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement,
"Commercial Paper Rate" means, with respect to any Interest Determination Date,
the Money Market Yield (as defined below) of the rate on such date for
commercial paper having the Index Maturity specified in the applicable Pricing
Supplement, as such rate shall be published in H.15(519), under the heading
"Commercial Paper." In the event that such rate is not published by 9:00 A.M.,
New York City time, on the Calculation Date pertaining to such Interest
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<PAGE> 14
Determination Date, then the Commercial Paper Rate shall be the Money Market
Yield of the rate on such Interest Determination Date for commercial paper of
the specified Index Maturity as published in Composite Quotations under the
heading "Commercial Paper." If by 3:00 P.M., New York City time, on such
Calculation Date such rate is not yet available in either H.15(519) or Composite
Quotations, then the Commercial Paper Rate shall be the Money Market Yield of
the arithmetic mean of the offered rates as of 11:00 A.M., New York City time,
on such Interest Determination Date of three leading dealers of commercial paper
in The City of New York (which may include one or more of the Agents) selected
by the Calculation Agent for commercial paper of the specified Index Maturity,
placed for an industrial issuer whose bond rating is "AA," or the equivalent,
from a nationally recognized rating agency; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not quoting offered
rates as mentioned in this sentence, the Commercial Paper Rate in effect for the
applicable period will be the same as the Commercial Paper Rate for the
immediately preceding Interest Reset Period (or, if there was no such Interest
Reset Period, the rate of interest payable on the Commercial Paper Rate Notes
for which such Commercial Paper Rate is being determined shall be the Initial
Interest Rate).
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
<TABLE>
<S> <C> <C>
D X 360
Money Market Yield = ------------- X 100
360 -(D X M)
</TABLE>
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the interest period for which interest is being calculated.
Federal Funds Rate Notes
Federal Funds Rate Notes will bear interest at the interest rate
(calculated with reference to the Federal Funds Rate and the Spread and/or
Spread Multiplier, if any, and subject to the Minimum Interest Rate and the
Maximum Interest Rate, if any) specified in the Federal Funds Rate Notes and in
the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Federal Funds Rate" means, with respect to any Interest Determination Date, the
rate on such date for Federal funds as published in H.15(519) under the heading
"Federal Funds (Effective)" (or any other heading that is the then applicable
heading established to describe such Index Maturity). However, if not so
published by 9:00 A.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Federal Funds Rate will be the rate on
such Interest Determination Date published in the Composite Quotations under the
heading "Federal Funds/Effective Rate." If such rate is not yet published in
either H.15(519) or the Composite Quotations by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, the
Federal Funds Rate for such Interest Determination Date will be calculated by
the Calculation Agent and will be the arithmetic mean of the rates for the last
transaction in overnight Federal funds, as of 11:00 A.M., New York City time, on
such Interest Determination Date, arranged by three leading brokers of Federal
funds transactions in The City of New York (which may include one or more of the
Agents) selected by the Calculation Agent; provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not quoting as set
forth above, the Federal Funds Rate in effect for the applicable period will be
the same as the Federal Funds Rate for the immediately preceding Interest Reset
Period (or, if there was no such Interest Reset Period, the rate of interest
payable on the Federal Funds Rate Notes for which such Federal Funds Rate is
being determined shall be the Initial Interest Rate).
LIBOR Notes
LIBOR Notes will bear interest at the interest rate (calculated with
reference to LIBOR and the Spread and/or Spread Multiplier, if any, and subject
to the Minimum Interest Rate and the Maximum Interest Rate, if any) specified in
the LIBOR Notes and in the applicable Pricing Supplement.
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Unless otherwise specified in the applicable Pricing Supplement, "LIBOR"
for each Interest Determination Date will be determined by the Calculation Agent
as follows:
(i) The rate for deposits in U.S. dollars of the Index Maturity
specified in the applicable Pricing Supplement, commencing on the second
Business Day immediately following such Interest Determination Date, that
appears on the Telerate Page 3750 as of 11:00 A.M., London time, on such
Interest Determination Date ("LIBOR Telerate"). "Telerate Page 3750" means
the display designated as page "3750" on the Telerate Service (or such
other page as may replace the page 3750 on that service or such other
service or services as may be designated by the British Bankers'
Association for the purpose of displaying London interbank offered rates
for U.S. dollar deposits).
(ii) As of the Interest Determination Date, the Calculation Agent will
determine the arithmetic mean of the offered rates for deposits in U.S.
dollars for the period of the Index Maturity designated in the applicable
Pricing Supplement, commencing on the second Business Day immediately
following such Interest Determination Date which appear on the Reuters
Screen LIBO Page at approximately 11:00 A.M., London time, on such Interest
Determination Date ("LIBOR Reuters"). "Reuters Screen LIBO Page" means the
display designated as Page "LIBO" on the Reuters Monitor Money Rates
Service (or such other page as may replace the LIBO page on that service
for the purpose of displaying London interbank offered rates of major
banks).
If neither LIBOR Telerate nor LIBOR Reuters is specified in the
applicable LIBOR Note, LIBOR will be determined as if LIBOR Telerate had
been specified.
(iii) If (a) in the case where paragraph (i) above applies, no rate
appears on the Telerate Page 3750 or (b) in the case where paragraph (ii)
above applies, fewer than two offered rates appear on the Reuters Screen
LIBO Page, the Calculation Agent will request the principal London offices
of each of four major banks in the London interbank market, as selected by
the Calculation Agent, to provide the Calculation Agent with its offered
quotation for deposits in United States dollars for the period of the
specified Index Maturity to prime banks in the London interbank market at
approximately 11:00 A.M., London time, on such Interest Determination Date
and in a principal amount equal to an amount of not less than U.S.$1
million that is representative of a single transaction in such market at
such time. If at least two such quotations are provided, LIBOR will be the
arithmetic mean of such quotations. If fewer than two quotations are
provided, LIBOR in respect of such Interest Determination Date will be the
arithmetic mean of rates quoted by three major banks in The City of New
York selected by the Calculation Agent (after consultation with the
Corporation) at approximately 11:00 A.M., New York City time, on such
Interest Determination Date for loans in U.S. dollars to leading European
banks, for the period of the specified Index Maturity and in a principal
amount of not less than U.S.$1 million that is representative of a single
transaction in such market at such time; provided however, that if fewer
than three banks selected as aforesaid by the Calculation Agent are quoting
rates as mentioned in this sentence, "LIBOR" for such Interest Reset Period
will be the same as LIBOR for the immediately preceding Interest Reset
Period (or, if there was no such Interest Reset Period, the rate of
interest payable on the LIBOR Notes for which LIBOR is being determined
shall be the Initial Interest Rate).
Prime Rate Notes
Prime Rate Notes will bear interest at the interest rate (calculated with
reference to the Prime Rate and the Spread and/or Spread Multiplier, if any, and
subject to the Minimum Interest Rate and the Maximum Interest Rate, if any)
specified in the Prime Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "Prime
Rate" means, with respect to any Interest Determination Date, the rate set forth
H.15(519) for such date opposite the caption "Bank Prime Loan" (or any other
heading that is the then applicable heading established to describe such Index
Maturity). If such rate is not yet published by 9:00 A.M., New York City time,
on the Calculation Date pertaining to such Interest Determination Date, the
Prime Rate for such Interest Determination Date will be the arithmetic mean of
the rates of interest publicly announced by each bank named on the Reuters
Screen NYMF Page (as defined below) as such bank's prime rate or base lending
rate as in effect for such Interest Determination Date
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as quoted on the Reuters Screen NYMF Page on such Interest Determination Date,
or, if fewer than four such rates appear on the Reuters Screen NYMF Page for
such Interest Determination Date, the rate shall be the arithmetic mean of the
prime rates quoted on the basis of the actual number of days in the year divided
by 360 as of the close of business on such Interest Determination Date by at
least two of the three major money center banks in The City of New York selected
by the Calculation Agent from which quotations are requested. If fewer than two
quotations are provided, the Prime Rate shall be calculated by the Calculation
Agent and shall be determined as the arithmetic mean on the basis of the prime
rates in The City of New York by the appropriate number of substitute banks or
trust companies organized and doing business under the laws of the United
States, or any State thereof, in each case having total equity capital of at
least U.S.$500 million and being subject to supervision or examination by
federal or state authority, selected by the Calculation Agent to quote such rate
or rates. "Reuters Screen NYMF Page" means the display designated as Page "NYMF"
on the Reuters Monitor Money Rates Services (or such other page as may replace
the NYMF Page on that service for the purpose of displaying prime rates or base
lending rates of major United States banks).
If in any month or two consecutive months the Prime Rate is not published
in H.15(519) and the banks or trust companies selected as aforesaid are not
quoting as mentioned in the preceding paragraph, the "Prime Rate" for such
Interest Reset Period will be the same as the Prime Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset Period,
the rate of interest payable on the Prime Rate Notes for which the Prime Rate is
being determined shall be the Initial Interest Rate). If this failure continues
over three or more consecutive months, the Prime Rate for each succeeding
Interest Determination Date until the maturity or redemption or repayment of
such Prime Rate Notes or, if earlier, until this failure ceases, shall be LIBOR
determined as if such Prime Rate Notes were LIBOR Notes with an Index Maturity
specified in the applicable Pricing Supplement, and the Spread, if any, shall be
the number of basis points specified in the applicable Pricing Supplement as the
"Alternative Rate Event Spread."
Treasury Rate Notes
Treasury Rate Notes will bear interest at the interest rate (calculated
with reference to the Treasury Rate and the Spread and/or Spread Multiplier, if
any, and subject to the Minimum Interest Rate and the Maximum Interest Rate, if
any) specified in the Treasury Rate Notes and in the applicable Pricing
Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Treasury Rate" means, with respect to any Interest Determination Date, the rate
for the auction held on such date of direct obligations of the United States
("Treasury Bills") having the Index Maturity designated in the applicable
Pricing Supplement, as published in H.15(519) under the heading "U.S. Government
Securities/Treasury Constant Maturities" (or any other heading that is the then
applicable heading established to describe such Index Maturity). However, if not
so published by 9:00 A.M., New York City time, on the Calculation Date
pertaining to such Interest Determination Date, the auction average rate on such
Interest Determination Date (expressed as a bond equivalent, on the basis of a
year of 365 or 366 days, as applicable, and applied on a daily basis) as
otherwise announced by the United States Department of the Treasury. In the
event that the results of the auction of Treasury Bills having the Index
Maturity designated in the applicable Pricing Supplement are not published or
reported are provided above by 3:00 P.M., New York City time, on such
Calculation Date or if no such auction is held on such Interest Determination
Date, then the Treasury Rate shall be calculated by the Calculation Agent and
shall be a yield to maturity (expressed as a bond equivalent, on the basis of a
year of 365 or 366 days, as applicable, and applied on a daily basis) calculated
using the arithmetic mean of the secondary market bid rates, as of approximately
3:30 P.M., New York City time, on such Interest Determination Date, of three
leading primary United States government securities dealers in The City of New
York (which may include one or more of the Agents) selected by the Calculation
Agent for the issue of Treasury Bills with a remaining maturity closest to the
Index Maturity designated in the applicable Pricing Supplement; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting bid rates as mentioned in this sentence, the Treasury Rate for the
applicable period will be the same as the Treasury Rate for the immediately
preceding Interest Reset Period (or, if there was no such Interest Reset
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Period, the rate of interest payable on the Treasury Rate Notes for which the
Treasury Rate is being determined shall be the Initial Interest Rate).
CMT Rate Notes
CMT Rate Notes will bear interest at the interest rate (calculated with
reference to the CMT Rate and the Spread and/or Spread Multiplier, if any, and
subject to the Minimum Interest Rate and Maximum Interest Rate, if any),
specified on the face of the CMT Rate Note and in the applicable Pricing
Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, "CMT Rate"
means, with respect to any Interest Determinate Date, the rate displayed on the
Designated CMT Telerate Page (as defined below) under the caption
" . . . Treasury Constant Maturities. . . . Federal Reserve Board Release
H.15 . . . Mondays Approximately 3:45 P.M.," under the column for the Designated
CMT Maturity Index (as defined below) for (i) if the Designated CMT Telerate
Page is 7055, the rate on such Interest Determination Date and (ii) if the
Designated CMT Telerate Page is 7052, the rate for the week, or the month, as
applicable, ended immediately preceding the week in which the related Interest
Determination Date occurs. If such rate is no longer displayed on the relevant
page, or if not displayed by 3:00 P.M., New York City time, on the related
Interest Calculation Date, then the CMT Rate for such Interest Determination
Date will be such Treasury Constant Maturity rate for the Designated CMT
Maturity Index as published in the relevant H.15(519). If such rate is no longer
published, or if not published by 3:00 P.M., New York City time, on the related
Interest Calculation Date, then the CMT Rate for such Interest Determination
Date will be such Treasury Constant Maturity rate for the Designated CMT
Maturity Index (or other United States Treasury rate for the Designated CMT
Maturity Index) for the Interest Determination Date with respect to such
Interest Reset Date as may then be published by either the Board of Governors of
the Federal Reserve System or the United States Department of the Treasury that
the Calculation Agent determines to be comparable to the rate formerly displayed
on the Designated CMT Telerate Page and published in the relevant H.15(519). If
such information is not provided by 3:00 P.M., New York City time, on the
related Interest Calculation Date, then the CMT Rate for the Interest
Determination Date will be calculated by the Calculation Agent and will be a
yield to maturity, based on the arithmetic mean (rounded to the nearest one
hundred-thousandth of a percentage point) of the secondary market closing offer
side prices as of approximately 3:30 P.M., New York City time, on the Interest
Determination Date reported, according to their written records, by three
leading primary United States government securities dealers (each, a "Reference
Dealer") in The City of New York (which may include one or more of the Agents)
selected by the Calculation Agent (from five such Reference Dealers selected by
the Calculation Agent and eliminating the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest)), for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury Note") with an original
maturity of approximately the Designated CMT Maturity Index and a remaining term
to maturity of not less than such Designated CMT Maturity Index minus one year.
If the Calculation Agent cannot obtain three such Treasury Note quotations, the
CMT Rate for such Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity based on the arithmetic mean
(rounded to the nearest one hundred-thousandth of a percentage point) of the
secondary market offer side prices as of approximately 3:30 P.M., New York City
time, on the Interest Determination Date of three Reference Dealers in The City
of New York (from five such Reference Dealers selected by the Calculation Agent
and eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for Treasury Notes with an original maturity of the number of years
that is the next highest to the Designated CMT Maturity Index and a remaining
term to maturity closest to the Designated CMT Maturity Index and in an amount
of at least U.S.$100 million. If three or four (and not five) of such Reference
Dealers are quoting as described above, then the CMT Rate will be based on the
arithmetic mean (rounded to the nearest one hundred-thousandth of a percentage
point) of the offer prices obtained and neither the highest nor lowest of such
quotes will be eliminated; provided, however, that if fewer than three Reference
Dealers in the City of New York (which may include one or more of the Agents)
selected by the Calculation Agent are quoting as described herein, the CMT Rate
will be the CMT Rate in effect on such Interest Determination Date. If two
Treasury Notes with an original maturity as described in the second
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preceding sentence have remaining terms to maturity equally close to the
Designated CMT Maturity Index, the quotes for the Treasury Note with the shorter
remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones Telerate
Service on the page designated in the applicable Pricing Supplement (or any
other page as may replace such page on the service for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519)), for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519). If no such
page is specified in the applicable Pricing Supplement, the Designated CMT
Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified in the applicable Pricing Supplement as the Index Maturity with
respect to which the CMT Rate will be calculated. If no such maturity is
specified in the applicable Pricing Supplement, the Designated CMT Maturity
Index shall be two years.
11th District Cost of Funds Rate Notes
Each 11th District Cost of Funds Rate Note will bear interest at the
interest rate (calculated with reference to the 11th District Cost of Funds Rate
and the Spread and/or Spread Multiplier, if any and subject to the Minimum
Interest Rate and Maximum Interest Rate, if any) specified in the applicable
11th District Cost of Funds Rate Notes.
Unless otherwise indicated in the applicable 11th District Cost of Funds
Rate Note, "11th District Cost of Funds Rate" means, with respect to any
Interest Determination Date, the rate equal to the monthly weighted average cost
of funds for the calendar month immediately preceding the month in which such
Interest Determination Date falls, as set forth under the caption "11th
District" on the Telerate Page 7058 as of 11 A.M., San Francisco time, on such
Interest Determination Date. If such rate does not appear on the Telerate 7058
on any related Interest Determination Date, the 11th District Cost of Funds Rate
means the rate equal to the monthly 11th District Cost of Funds Index (the "11th
District Cost of Funds Index") normally published by the Federal Home Loan Bank
of San Francisco (the "FHLB of San Francisco") during the month immediately
preceding the Interest Reset Date to which such Interest Determination Date
applies.
The 11th District Cost of Funds Index is normally published by the FHLB of
San Francisco on the last day on which the FHLB of San Francisco is open for
business in each month and represents the monthly weighted average cost of funds
for savings institutions in the 11th District (Arizona, California and Nevada)
of the Federal Home Loan Bank System for the month preceding the month in which
the 11th District Cost of Funds Index is published. Currently, the 11th District
Cost of Funds Index is computed by the FHLB of San Francisco for each month by
dividing the cost of funds (interest paid during the month by 11th District
savings institutions on savings, advances and other borrowings) by the average
of the total amount of those funds outstanding at the end of that month and the
prior month and annualizing and adjusting the result to reflect the actual
number of days in the particular month. If necessary, before these calculations
are made, the component figures are adjusted by the FHLB of San Francisco to
neutralize the effect of events such as member institutions leaving the 11th
District or acquiring institutions outside the 11th District. Receipt by mail of
Information Bulletins announcing 11th District Cost of Funds Index changes may
be arranged by contacting the FHLB of San Francisco.
If the FHLB of San Francisco shall fail in any month to publish the 11th
District Cost of Funds Index (each such failure being referred to herein as an
"Alternative Rate Event"), then the 11th District Cost of Funds Rate for the
Interest Determination Date after the Alternate Rate Event shall be calculated
on the basis of the 11th District Cost of Funds Index most recently published
prior to such Interest Determination Date. If an Alternate Rate Event occurs in
the month immediately following a month in which a prior Alternate Rate Event
occurred, then the 11th District Cost of Funds Rate for the Interest
Determination Date immediately following the second Alternate Rate Event shall
be calculated on the basis of the 11th District Cost of Funds Index most
recently published prior to such Interest Determination Date and, thereafter,
the 11th District Cost of Funds Rate for each succeeding Interest Determination
Date shall be LIBOR, determined as though the Interest Rate Basis were LIBOR and
the Spread shall be plus or minus the number
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of basis points specified in the applicable 11th District Cost of Funds Rate
Note at the "Alternate Rate Event Spread," if any.
In determining that the FHLB of San Francisco has failed in any month to
publish the 11th District Cost of Funds Index, the Calculation Agent may rely
conclusively on any written advice from the FHLB of San Francisco to such
effect.
INDEXED NOTES
The Notes may be issued, from time to time, as Notes of which the principal
amount payable on the Stated Maturity and/or on which the amount of interest
payable on an Interest Payment Date and/or any premium payable will be
determined by reference to prices, changes in prices, or differences between
prices, of securities, currencies, currency units, composite currencies,
intangibles, goods, articles, or commodities or other objective price, economic
or other measures (the "Indexed Notes"), as indicated in the applicable Pricing
Supplement. Holders of Indexed Notes may receive a principal amount at maturity
that is greater than or less than the face amount of such Notes depending upon
the fluctuation of the relative value, rate or price of the specified index.
Specific information pertaining to the method for determining the principal
amount payable at maturity, a historical comparison of the relative value, rate
or price of the specified index and the face amount of the Indexed Note and
certain additional United States federal tax and other relevant considerations
will be described in the applicable Pricing Supplement.
EXTENSION OF MATURITY
The Pricing Supplement relating to each Fixed Rate Note (other than an
Amortizing Note) will indicate whether the Corporation has the option to extend
the maturity of such Fixed Rate Note for one or more periods specified in the
applicable Pricing Supplement (each, an "Extension Period") up to but not beyond
the date (the "Final Maturity Date") set forth in such Pricing Supplement. If
the Corporation has such option with respect to any such Fixed Rate Note (an
"Extendible Note"), the following procedures will apply, unless modified as set
forth in the applicable Pricing Supplement.
The Corporation may exercise such option with respect to an Extendible Note
by notifying the Paying Agent of such exercise at least 50 but not more than 60
calendar days prior to the maturity date originally in effect with respect to
such Note (the "Original Maturity Date") or, if the maturity date of such Note
has already been extended, prior to the maturity date then in effect (an
"Extended Maturity Date"). No later than 40 calendar days prior to the Original
Maturity Date or an Extended Maturity Date, as the case may be (each, a
"Maturity Date"), the Paying Agent will mail to the holder of such Note a notice
(the "Extension Notice") relating to such Extension Period, by first class mail,
postage prepaid, setting forth (a) the election of the Corporation to extend the
maturity of such Note; (b) the new Extended Maturity Date; (c) the interest rate
applicable to the Extension Period; and (d) the provisions, if any, for
redemption during the Extension Period, including the date or dates on which,
the period or periods during which and the price or prices at which such
redemption may occur during the Extension Period. Upon the mailing by the Paying
Agent of an Extension Notice to the holder of an Extendible Note, the maturity
of such Note shall be extended automatically, and, except as modified by the
Extension Notice and as described in the next paragraph, such Note will have the
same terms it had prior to the mailing of such Extension Notice.
Notwithstanding the foregoing, not later than 10:00 A.M., New York City
time, on the 20th calendar day prior to the Maturity Date then in effect for an
Extendible Note (or, if such day is not a Business Day, not later than 10:00
A.M., New York City time, on the immediately succeeding Business Day), the
Corporation may, at its option, revoke the interest rate provided for in the
Extension Notice and establish a higher interest rate for the Extension Period
by causing the Paying Agent to send notice of such higher interest rate to the
holder of such Note by first class mail, postage prepaid, or by such other means
as shall be agreed between the Corporation and the Paying Agent. Such notice
shall be irrevocable. All Extendible Notes with respect to which the Maturity
Date is extended in accordance with an Extension Notice will bear such higher
interest rate for the Extension Period, whether or not tendered for repayment.
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If the Corporation elects to extend the maturity of an Extendible Note, the
holder of such Note will have the option to require the Corporation to repay
such Note on the Maturity Date then in effect at a price equal to the principal
amount thereof plus any accrued and unpaid interest to such date. In order for
an Extendible Note to be repaid on such Maturity Date, the holder thereof must
follow the procedures set forth below under "Repayment at the Noteholders'
Option" for optional repayment, except that the period for delivery of such Note
or notification to the Paying Agent shall be at least 25 but not more than 35
calendar days prior to the Maturity Date then in effect and except that a holder
who has tendered an Extendible Note for repayment pursuant to an Extension
Notice may, by written notice to the Paying Agent, revoke any such tender for
repayment until 3:00 P.M., New York City time, on the 10th calendar day prior to
the Maturity Date then in effect (or, if such day is not a Business Day, until
3:00 P.M., New York City time, on the next succeeding Business Day).
RENEWABLE NOTES
The Corporation may also issue from time to time variable rate renewable
notes (the "Renewable Notes") that will bear interest at the interest rate
(calculated with reference to a Base Rate and the Spread and/or Spread
Multiplier, if any, and subject to the Minimum Interest Rate and the Maximum
Interest Rate, if any) specified in the Renewable Notes and in the applicable
Pricing Supplement.
The Renewable Notes will mature on an Interest Payment Date as specified in
the applicable Pricing Supplement (the "Initial Maturity Date"), unless the
maturity of all or any portion of the principal amount thereof is extended in
accordance with the procedures described below. On the Interest Payment Dates in
June and December in each year (unless different Interest Payment Dates are
specified in the applicable Pricing Supplement) (each such Interest Payment
Date, an "Election Date"), the maturity of the Renewable Notes will be extended
to the Interest Payment Date occurring 12 months after such Election Date,
unless the holder thereof elects to terminate the automatic extension of the
maturity of the Renewable Notes or of any portion thereof having a principal
amount of $100,000 or any multiple of $100,000 in excess thereof by delivering a
notice to such effect to the Paying Agent not less than nor more than a number
of days to be specified in the applicable Pricing Supplement prior to such
Election Date. Such option may be exercised with respect to less than the entire
principal amount of the Renewable Notes; provided that the principal amount for
which such option is not exercised is at least $100,000 or any larger amount
that is an integral multiple of $100,000. Notwithstanding the foregoing, the
maturity of the Renewable Notes may not be extended beyond the Final Maturity
Date, as specified in the applicable Pricing Supplement (the "Final Maturity
Date"). If the holder elects to terminate the automatic extension of the
maturity of any portion of the principal amount of the Renewable Notes and such
election is not revoked as described below, such portion will become due and
payable on the Interest Payment Date falling six months (unless another period
is specified in the applicable Pricing Supplement) after the Election Date prior
to which the holder made such election.
An election to terminate the automatic extension of maturity may be revoked
as to any portion of the Renewable Notes having a principal amount of $100,000
or any multiple of $100,000 in excess thereof by delivering a notice to such
effect to the Paying Agent or any day following the effective date of the
election to terminate the automatic extension of maturity and prior to the date
15 calendar days before the date on which such portion would otherwise mature.
Such a revocation may be made for less than the entire principal amount of the
Renewable Notes for which the automatic extension of maturity has been
terminated; provided that the principal amount of the Renewable Notes for which
the automatic extension of maturity has been terminated and for which such a
revocation has not been made is at least $100,000 or any larger amount that is
an integral multiple of $100,000. Notwithstanding the foregoing, a revocation
may not be made during the period from and including a Record Date to but
excluding the immediately succeeding Interest Payment Date.
An election to terminate the automatic extension of the maturity of the
Renewable Notes, if not revoked as described above by the holder making the
election or any subsequent Holder, will be binding upon such subsequent holder.
The Renewable Notes may be redeemed in whole or in part at the option of
the Corporation on the Interest Payment Date for the year specified in the
applicable Pricing Supplement, commencing with the
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Interest Payment Date specified in the applicable Pricing Supplement, at a
redemption price as stated in the applicable Pricing Supplement, together with
accrued and unpaid interest to the date of redemption. Notwithstanding anything
to the contrary in this Prospectus Supplement, notice of redemption will be
provided by mailing a notice of such redemption to each holder by first class
mail, postage prepaid, at least 180 calendar days prior to the date fixed for
redemption.
BOOK-ENTRY SYSTEM
Unless otherwise indicated in the applicable Pricing Supplement, upon
issuance, all Fixed Rate Book-Entry Notes having the same Issue Date, interest
rate, if any, amortization schedule, if any, maturity date and other terms, if
any, will be represented by one or more Global Securities, and all Floating Rate
Book-Entry Notes having the same Issue Date, Initial Interest Rate, Base Rate,
Interest Reset Period, Interest Payment Dates, Index Maturity, Spread and/or
Spread Multiplier, if any, Minimum Interest Rate, if any, Maximum Interest Rate,
if any, maturity date and other terms, if any, will be represented by one or
more Global Securities. Each Global Security representing Book-Entry Notes will
be deposited with, or on behalf of, the Depository, and registered in the name
of a nominee of the Depository. Certificated Notes will not be exchangeable for
Book-Entry Notes. Book-Entry Notes will not be exchangeable for Certificated
Notes and will not otherwise be issuable as Certificated Notes, except under the
circumstances described in the Prospectus under "Description of Debt
Securities -- Book-Entry Procedures."
Settlement for the Book-Entry Notes will be made in immediately available
funds. The Book-Entry Notes will trade in the Depository's Same-Day Funds
Settlement System until maturity, and therefore the Depository will require
secondary trading activity in the Book-Entry Notes to be settled in immediately
available funds.
A further description of the Depository's procedures with respect to Global
Securities representing Book-Entry Notes is set forth in the accompanying
Prospectus under "Description of Debt Securities -- Book-Entry Procedures." The
Depository has confirmed to the Corporation, each Agent and the Trustee that it
intends to follow such procedures.
OPTIONAL REDEMPTION
Unless otherwise indicated in the applicable Pricing Supplement, Notes may
not be redeemed by the Corporation prior to maturity. If so specified in the
applicable Pricing Supplement, the Notes will be redeemable prior to maturity at
the option of the Corporation on the terms specified therein. Unless otherwise
indicated in the applicable Pricing Supplement, notice of redemption will be
provided by mailing a notice of such redemption to each holder by first class
mail, postage prepaid, at least 30 days and not more than 60 calendar days prior
to the date fixed for redemption to the respective address of each holder as
that address appears upon the books maintained by the Paying Agent.
REPAYMENT AT THE NOTEHOLDERS' OPTION
Unless otherwise indicated in the applicable Pricing Supplement, Notes may
not be repaid at the option of the holders thereof prior to maturity. If so
specified in the applicable Pricing Supplement, a Note will be repayable at the
option of the holder on a date or dates specified prior to its maturity date
and, unless otherwise specified in such Pricing Supplement, at the Repayment
Price together with accrued interest to the Repayment Date, each as specified in
the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, in order
for such a Note to be repaid, the Paying Agent must receive at least 30 days but
not more than 45 calendar days prior to the Repayment Date the Note with the
form entitled "Option to Elect Repayment" on the reverse of the Note duly
completed. Except in the case of Extendible Notes, and unless otherwise
specified in the applicable Pricing Supplement, exercise of the repayment option
by the holder of a Note will be irrevocable. On any Repayment Date with respect
to any Note, such Note will be repayable in whole or in part in increments of
$1,000 (provided that any remaining principal amount of such Note will not be
less than the minimum authorized
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denomination of such Note) at the option of the holder thereof at a Repayment
Price specified in the applicable Pricing Supplement together with interest
accrued thereon to the Repayment Date.
The Depository's nominee will be the holder of the Notes and, therefore,
will be the only entity that can exercise a right to repayment. In order to
ensure that the Depository's nominee will timely exercise a right to repayment
with respect to a particular Note, the beneficial owner of such Note must
instruct the broker or other direct or indirect participant through which it
holds an interest in such Note to notify the Depository of its desire to
exercise a right to repayment. Different Participants have different cut-off
times for accepting instructions from their customers and, accordingly, each
beneficial owner should consult the broker or other direct or indirect
participant through which it holds an interest in a Note in order to ascertain
the cut-off time by which such an instruction must be given in order for timely
notice to be delivered to the Depository.
REPURCHASE
The Corporation may purchase Notes at any price in the open market or
otherwise. Notes so purchased by the Corporation may, at the discretion of the
Corporation, be held or resold or surrendered to the relevant Trustee for
cancellation.
FOREIGN CURRENCY RISKS
EXCHANGE RATE AND EXCHANGE CONTROLS
Any investment in Notes that are denominated in, or the payment of which is
related to the value of, a Specified Currency other than U.S. dollars entails
significant risks that are not associated with a similar investment in a
security denominated in U.S. dollars. Such risks include, without limitation,
the possibility of significant changes in rates of exchange between the U.S.
dollar and the various foreign currencies (or composite currencies or currency
units) and the possibility of the imposition or modification of exchange
controls by either the U.S. or foreign governments. Such risks generally depend
on economic and political events over which the Corporation has no control. In
recent years, rates of exchange between U.S. dollars and certain foreign
currencies have been highly volatile and such volatility may be expected to
continue in the future. Fluctuations in any particular exchange rate that have
occurred in the past are not necessarily indicative, however, of fluctuations in
such rate that may occur during the term of any Note. Depreciation against the
U.S. dollar of the currency in which a Note is payable would result in a
decrease in the effective yield of such Note below its coupon rate and, in
certain circumstances, could result in a loss to the investor on a U.S. dollar
basis. In addition, depending on the specific terms of a currency linked Note,
changes in exchange rates relating to any of the currencies involved may result
in a decrease in its effective yield and, in certain circumstances, could result
in a loss of all or a substantial portion of the principal of a Note to the
investor.
THIS PROSPECTUS SUPPLEMENT AND THE ATTACHED PROSPECTUS DO NOT DESCRIBE ALL
THE RISKS OF AN INVESTMENT IN NOTES DENOMINATED IN, OR THE PAYMENT OF WHICH IS
RELATED TO THE VALUE OF, A FOREIGN CURRENCY OR A COMPOSITE CURRENCY. THE
MATERIAL RISKS RELATED TO THE PURCHASE OF ANY SUCH NOTES WILL BE DISCLOSED TO
PROSPECTIVE INVESTORS IN THE APPLICABLE PRICING SUPPLEMENT RELATING TO ANY SUCH
NOTES. IN ADDITION, PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN FINANCIAL AND
LEGAL ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN NOTES DENOMINATED
IN, OR THE PAYMENT OF WHICH IS RELATED TO THE VALUE OF, SPECIFIED CURRENCIES
OTHER THAN U.S. DOLLARS. SUCH NOTES ARE NOT AN APPROPRIATE INVESTMENT FOR
INVESTORS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY TRANSACTIONS.
Except as set forth below under "United States Tax
Considerations -- Non-U.S. Holders," the information set forth in this
Prospectus Supplement is directed to prospective purchasers who are United
States residents, and the Corporation disclaims any responsibility to advise
prospective purchasers who are residents of countries other than the United
States with respect to any matters that may affect the purchase, holding or
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receipt of payments of principal, premium, if any, and interest on the Notes.
Such persons should consult their own counsel with regard to such matters.
Governments have imposed from time to time, and may in the future impose,
exchange controls which could affect exchange rates as well as the availability
of a specified foreign currency at the time of payment of principal of, premium,
if any, or interest on a Note. Even if there are no actual exchange controls, it
is possible that the Specified Currency for any particular Note not denominated
in U.S. dollars would not be available when payments on such Note are due. In
that event, the Corporation would make required payments in U.S. dollars on the
basis of the Market Exchange Rate on the date of such payment, or if such rate
of exchange is not then available, on the basis of the Market Exchange Rate as
of the most recent practicable date. See "Description of Notes -- Payment
Currency and Currency Exchange Information."
With respect to any Note denominated in, or the payment of which is related
to the value of, a foreign currency or currency unit, the applicable Pricing
Supplement will include information with respect to applicable current exchange
controls, if any, and historic exchange rate information on such currency or
currency unit. The information contained therein shall constitute a part of this
Prospectus Supplement and is furnished as a matter of information only and
should not be regarded as indicative of the range of or trends in fluctuations
in currency exchange rates that may occur in the future.
GOVERNING LAW AND JUDGMENTS
The Notes will be governed by and construed in accordance with the laws of
the State of New York. In the event an action based on Notes denominated in a
Specified Currency other than U.S. dollars were commenced in a Federal or State
court in the United States, it is likely that such court would grant judgment
relating to the Notes only in U.S. dollars. The date used to determine the rate
of conversion of a Specified Currency into United States dollars will depend
upon various factors, including which court renders the judgment. In the event
of an action based on Notes denominated in a Specified Currency other than U.S.
dollars in a state court in the State of New York, such court would be required
to render such judgment in the Specified Currency in which the Note is
denominated, and such judgment would be converted into U.S. dollars at the
exchange rate prevailing on the date of entry of the judgment.
UNITED STATES TAX CONSIDERATIONS
In the opinion of Thompson Hine & Flory P.L.L., special tax counsel to the
Corporation, the following summary accurately describes certain material United
States federal income tax statutory and regulatory provisions which may pertain
to the purchase, ownership and disposition of Notes as of the date hereof. This
summary is based on laws, regulations, rulings and decisions now in effect (or,
in the case of certain regulations, in proposed form) all of which are subject
to change (including changes in effective dates) or possible differing
interpretations, which could result in federal income tax consequences different
from those discussed below. It deals only with Notes held as capital assets and
does not purport to deal with persons in special tax situations, such as
financial institutions, insurance companies, regulated investment companies,
dealers in securities or currencies, persons holding Notes as a hedge against
currency risks or as a position in a "straddle" for tax purposes, or persons
whose functional currency is not the United States dollar. It does not deal with
Notes other than Notes in the registered form. The federal income tax
consequences of purchasing, holding or disposing of Amortizing Notes, Extendible
Notes, Renewable Notes, Indexed Notes, Foreign Currency Notes (other than the
Single Foreign Currency Notes (as defined below)) and Floating Rate Notes that
provide for one Base Rate followed by a different Base Rate, a Base Rate
followed by a fixed rate, or a fixed rate followed by a Base Rate will be set
out in the applicable pricing supplement. It also does not deal with holders
other than original purchasers. Additional tax considerations or consequences
may result from the particular terms established in any Pricing Supplement or in
any Note. This opinion is limited to the present laws of the United States, and
Thompson Hine & Flory P.L.L. assumes no obligation to revise or supplement this
opinion with respect to Notes issued pursuant to this Registration Statement in
the event the present laws referred to above change by legislative action,
judicial decision, or otherwise, or the facts as they presently exist change to
the extent any such changes occur after the date of issue. PERSONS CONSIDERING
THE PURCHASE,
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OWNERSHIP, OR DISPOSITION OF THE NOTES SHOULD CONSULT THEIR OWN TAX ADVISORS
CONCERNING THE APPLICATION OF UNITED STATES FEDERAL INCOME TAX LAWS TO THEIR
PARTICULAR SITUATIONS AS WELL AS ANY CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE NOTES ARISING UNDER THE LAWS OF ANY OTHER TAXING
JURISDICTION.
As used herein, a "U.S. Holder" of a Note means a beneficial owner of a
Note that is for United States federal income tax purposes (i) a citizen or
resident of the United States, (ii) a corporation, partnership or other entity
created or organized in or under the laws of the United States, any state, or of
any political subdivision thereof, or (iii) an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source. As used herein, the term "Non-U.S. Holder" means a holder of a Note that
is not a U.S. Holder.
"Single Foreign Currency Note" means a Note on which all payments a holder
is entitled to receive are denominated in or determined by reference to the
value of a single Foreign Currency. "Foreign Currency" means a currency or
currency unit, other than a hyperinflationary currency or the U.S. dollar.
PAYMENTS OF INTEREST
Payments of interest on a Note generally will be taxable to a U.S. Holder
as ordinary interest income at the time such payments are accrued or received in
accordance with the U.S. Holder's method of accounting for tax purposes.
ORIGINAL ISSUE DISCOUNT AND ACQUISITION DISCOUNT
Notes with a term greater than one year may be issued with original issue
discount for United States federal income tax purposes (a "Discount Note").
Generally, original issue discount will arise if the stated redemption price at
maturity (generally, the principal amount) of a Note exceeds its issue price by
more than a de minimis amount or if a Note has certain interest payment
characteristics (e.g., interest holidays, interest payable in additional notes,
stepped interest rates or interest rates based upon multiple indices). The issue
price of Discount Notes that are issued for cash will be the first price at
which a substantial amount of the Discount Notes in such issue are sold. If a
Note is issued with original issue discount, a holder of the Note will be
required to include amounts in gross income for United States federal income tax
purposes on an accrual basis using the constant yield to maturity method and, as
a result, a holder may be required to include such amount in income in advance
of receipt of the cash payments to which such amounts are attributable. Any
amounts included in income as original issue discount with respect to a Discount
Note will increase a U.S. Holder's adjusted tax basis in the Discount Note.
In addition, Floating Rate Notes may be subject to rules that differ from
these general rules. Prospective investors should consult their own tax advisors
with respect to the tax consequences of any prospective purchase of Floating
Rate Notes. The following summary is based upon Treasury Regulations that were
published in the Federal Register on February 2, 1994, that became effective as
Final Treasury Regulations on April 4, 1994 and that were amended on June 11,
1996 to be generally effective on June 14, 1996, and Treasury Regulations
published in the Federal Register on June 11, 1996 and that are generally
effective as Final Treasury Regulations on August 13, 1996 (collectively, the
"OID Regulations").
In general, a Note will be treated as a "variable rate debt instrument" for
purposes of the OID Regulations if the Note is issued for an amount that does
not exceed the total noncontingent principal payments by more than an amount
equal to the lesser of (i) 0.015 multiplied by the product of the total
noncontingent principal and the number of complete years to maturity from the
issue date; or (ii) 15% of the total noncontingent principal payments. In
addition, to be a variable rate debt instrument, the Note must bear stated
interest (compounded or paid at least annually) at (i) one or more qualified
floating rates, (ii) a single fixed rate and one or more qualified floating
rates, (iii) a single objective rate or (iv) a single fixed rate and a single
objective rate that is a "qualified inverse floating rate". A qualified floating
rate or objective rate must be set at a "current value" of that rate; a "current
value" is the value of the variable rate on any day that is no earlier than
three months prior to the first day on which that value is in effect and no
later than one year following that day. A "qualified floating rate" generally is
a rate the variations in the value of which can reasonably be expected to
measure contemporaneous variations in the cost of newly borrowed funds in the
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currency in which the Note is denominated. A qualified floating rate may be
multiplied by a fixed, positive multiple not exceeding 1.35, which may be
increased or decreased by a fixed rate. However, for Notes issued on or after
August 13, 1996, a multiple of a qualified floating rate will be a qualified
floating rate only if it is a fixed multiple that is greater than .65, but less
than 1.35. If a Note provides for two or more qualified floating rates that can
reasonably be expected to have approximately the same values throughout the term
of the instrument, the qualified floating rates together constitute a single
qualified floating rate. A combination of such rates is conclusively presumed to
be a single qualified floating rate if the values of all rates on the issue date
are within 0.25 percentage points of each other. A variable rate that is subject
to an interest rate cap, floor, governor or similar restriction on rate
adjustment may be a qualified floating rate only if such restriction is fixed
throughout the term of the debt instrument, or is not reasonably expected as of
the issue date to cause the yield on the debt instrument to differ significantly
from its expected yield absent the restriction. An "objective rate" is a rate
(other than a qualified floating rate) that is determined using a single fixed
formula and that is based on: (i) one or more qualified floating rates, (ii) one
or more rates each of which would be a qualified floating rate for a debt
obligation denominated in a currency other than currency in which the debt
instrument is denominated, (iii) the yield or change in the price of one or more
items of actively traded personal property, other than the stock or debt of the
issuer or a related party, or (iv) a combination of the rates described in
(i)-(iii) herein. For Notes issued on or after August 13, 1996, the definition
of "objective rate" is amended to mean a rate (other than a qualified floating
rate) that is determined by using a single fixed formula and that is based on
objective financial or economic information (other than a rate based on
information that is within the control of the issuer (or related party) or that
is unique to the circumstances of the issuer (or related party), such as
dividends, profits or the value of the issuer's stock). The Internal Revenue
Service (the "IRS") may designate other variable rates that will be treated as
objective rates. However, a variable rate is not an objective rate if it is
reasonably expected that the average value of the rate during the first half of
the debt instrument's term will differ significantly from the average value of
such rate during the final half of its term. A "qualified inverse floating rate"
is a rate that is equal to a fixed rate minus a qualified floating rate and the
variations in which can reasonably be expected to inversely reflect
contemporaneous variations in the qualified floating rate, disregarding certain
restrictions on such rate such as caps, floors or governors. Finally, the OID
Regulations specify that a variable rate debt instrument may not provide for any
principal payments that are contingent.
In general, the rules for determining the amount and accrual of original
issue discount and qualified stated interest on a variable rate debt instrument
convert the debt instrument into a fixed rate debt instrument and then apply the
general original issue discount rules to the debt instrument. If a Note bears
interest that is unconditionally payable at least annually at a single qualified
floating rate or an objective rate, all stated interest is qualified stated
interest. In the case of a single qualified floating rate or a qualified inverse
floating rate, the accrual of original issue discount is determined by assuming
that the rate is fixed upon issuance at the initial value of the interest rate.
In the case of an objective interest rate (other than a qualified inverse
floating rate), the accrual of original issue discount is calculated by assuming
that the Note bears interest at a fixed rate that reflects the yield that is
reasonably expected for the Note. In both cases, the amount of qualified stated
interest (stated interest that is unconditionally payable at least annually at a
single fixed rate) allocable to an accrual period is increased (or decreased) if
the interest actually paid during that period exceeds (or is less than) the
interest assumed to be paid. If a Note bears interest at a variable rate other
than a single qualified floating rate or objective rate, the amount and accrual
of original issue discount are generally determined by converting the variable
rate debt instrument into a fixed rate debt instrument as generally described
above, applying the general original issue discount rules, and then making
appropriate adjustments for actual interest rates under the Note.
Notes that provide for a variable rate of interest but that do not qualify
as variable rate debt instruments are contingent payment debt instruments. The
OID Regulations relating to the tax treatment of contingent payment debt
instruments (effective for debt instruments issued on or after August 13, 1996)
adopt the "noncontingent bond method" for contingent payment debt instruments
that are issued for cash or publicly traded property. Under the noncontingent
bond method, the yield on the debt instrument must first be determined based on
the yield at which the issuer would issue a fixed rate debt instrument with
terms and conditions similar to those of the contingent payment debt instrument.
A projected payment schedule is then
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set to fit the yield. Once a projected payment schedule is determined for a debt
instrument as of the issue date, interest accrues on the debt instrument based
on this schedule. The projected payment schedule includes all noncontingent
payments as well as a projected amount for each contingent payment. Appropriate
adjustments are made to account for any difference between the projected amount
of a contingent payment and the actual amount of the payment. The projected
amounts are, in effect, treated as fixed, and interest accrual is required based
on these projected amounts whether or not the amount of any payment is fixed or
determinable in the taxable year. Thus, the noncontingent bond method may result
in recognition of income prior to the receipt of cash. Prospective investors
should consult their own tax advisors with respect to the application of the
contingent payment debt instrument provisions to Floating Rate Notes.
The OID Regulations provide special rules for Notes that provide for one or
more alternative payment schedules applicable upon the occurrence of a
contingency or contingencies, including optional redemption. Notes which may be
redeemed in whole or in part prior to their Stated Maturity will be treated as
having a maturity date for federal income tax purposes on such redemption date
if such redemption would result in a lower yield to maturity in the case of a
redemption at the issuer's option or a higher yield to maturity in the case of a
redemption at the holder's option. Notice will be given in the applicable
Pricing Supplement when the Corporation determines that a particular Note will
be deemed to have a maturity date for federal income tax purposes prior to its
Stated Maturity. Investors intending to purchase Notes with such features should
consult their own tax advisors, since the original issue discount consequences
will depend, in part, on the particular terms and features of such Notes.
SHORT-TERM NOTES
Notes that have a fixed maturity of one year or less ("Short-Term Notes")
generally will be deemed to have been issued with original issue discount
(generally, the excess of the Short-Term Note's principal amount, plus all
interest payable on the Note, over the Note's purchase price). In general, an
individual or other cash method U.S. Holder is not required to accrue original
issue discount on a Short-Term Note unless the holder elects to do so. If such
an election is not made, any gain recognized by the U.S. Holder on a taxable
disposition (including the maturity) of a Short-Term Note will be ordinary
income to the extent of the original issue discount accrued on a straight-line
basis, or upon election on a constant yield method (based on daily compounding)
through the date of sale or maturity, and a portion of the deductions otherwise
allowable to the U.S. Holder for interest on borrowings allocable to a
Short-Term Note will be deferred until a corresponding amount of income is
realized. U.S. Holders who report income for federal income tax purposes under
the accrual method, and certain other holders, including banks and dealers in
securities, are required to accrue original issue discount on a Short-Term Note
on a straight line basis unless an election is made to accrue the original issue
discount under a constant yield method (based on daily compounding).
MARKET DISCOUNT
If a U.S. Holder purchases a Note, other than a Discount Note, for an
amount that is less than its issue price or, in the case of a Discount Note, for
an amount that is less than its adjusted issue price as of the purchase date,
the amount of such difference will be treated as "market discount" for United
Stated federal income tax purposes, unless such difference is less than a
specified de minimis amount. Under the market discount rules, a U.S. Holder will
be required to treat any gain in the sale, exchange, retirement or other taxable
disposition of a Note as ordinary income to the extent that any market discount
has accrued with respect to such Note and was not previously included in income
by the U.S. Holder (pursuant to an election by the U.S. Holder to include such
market discount in income as it accrues) at the time of such disposition. Market
discount is accrued on a straight line basis unless the U.S. Holder elects to
accrue market discount under a constant yield method. If the Note is disposed of
in a nontaxable transaction (other than a nonrecognition transaction described
in Section 1276(c) of the Internal Revenue Code of 1986, as amended (the
"Code")), a U.S. Holder will include any accrued market discount in ordinary
income (generally, as interest) as if such holder had sold the Note at its then
fair market value. In addition, the holder may be required to defer, until the
maturity of the Note or its earlier disposition in a taxable transaction,
deductions
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for all or a portion of the interest expense on any indebtedness incurred or
maintained to purchase or carry such Note.
ACQUISITION PREMIUM; AMORTIZABLE BOND PREMIUM
A U.S. Holder who purchases a Note for an amount that is greater than its
adjusted issue price but equal to or less than its stated redemption price at
maturity (generally, the sum of all amounts payable on the Note after the
purchase date other than payments of qualified stated interest) will be
considered to have purchased such Note at an "acquisition premium." Under the
acquisition premium rules, the amount of original issue discount which such
holder must include in its gross income with respect to such Note for any
taxable year will be reduced by the portion of such acquisition premium properly
allocable to such taxable year.
A U.S. Holder who purchases a Note for an amount in excess of the Note's
stated redemption price at maturity will be considered to have purchased the
Note at a "premium" and will not be required to include any original issue
discount in income. A U.S. Holder generally may elect to amortize this premium
over the remaining term of the Note on a constant yield method. The amount
amortized in any taxable year will be treated as a reduction of the U.S.
Holder's interest income from the Note. If a U.S. Holder does not make such an
election, the amount of such premium will decrease the gain or increase the loss
otherwise recognized on a taxable disposition of the Note.
ELECTION TO TREAT ALL INTEREST AS ORIGINAL ISSUE DISCOUNT
Under the OID Regulations, a U.S. Holder may elect to treat all interest on
any Note as original issue discount and calculate the amount includable in gross
income under the constant yield method. For the purposes of this election,
interest includes stated interest, acquisition discount, original issue
discount, de minimis original issue discount, market discount, de minimis market
discount and unstated interest, as adjusted by any amortizable bond premium or
acquisition premium. If a U.S. Holder makes this election for a Note with market
discount or amortizable bond premium, the election is treated as an election
under the market discount or amortizable bond premium provisions described
above. The election is to be made for the taxable year in which the U.S. Holder
acquired the Note, and may not be revoked without the consent of the IRS. U.S.
Holders should consult with their own tax advisors about this election.
DISPOSITION OF A NOTE
Except as discussed above, upon the sale, exchange or retirement of a Note,
a U.S. Holder generally will recognize taxable gain or loss equal to the
difference between the amount realized on the sale, exchange or retirement of
the Note and such holder's adjusted tax basis in the Note. A U.S. Holder's
adjusted tax basis in a Note generally will equal such U.S. Holder's initial
investment in the Note increased by any original issue discount included in
income (and accrued market discount, if any, if the U.S. Holder has elected to
include such market discount in income) and decreased by the amount of any
payments made with respect to the Notes, other than payments of qualified stated
interest, and the amount of any amortizable bond premium taken with respect to
such Note. Such gain or loss generally will be long term capital gain or loss if
the Note is held for more than one year.
NON-U.S. HOLDERS
A Non-U.S. Holder will not be subject to United States federal income taxes
on payments of interest (including original issue discount, if any) on a Note,
unless such Non-U.S. Holder is (i) a direct or indirect 10% or greater
shareholder of the Corporation that issued such Note, (ii) a controlled foreign
corporation related to the Corporation that issued such Note, or (iii) a bank
described in section 881(c)(3)(A) of the Code. To qualify for the "portfolio
interest" exemption described above, the last United States payor in the chain
of payment prior to payment to a Non-U.S. Holder (the "Withholding Agent") must
receive in the year in which a payment of interest occurs, or in either of the
two preceding calendar years, a statement that (i) is signed by the beneficial
owner of the Note under penalties of perjury, (ii) certifies that such owner is
not a U.S. Holder and (iii) provides the name and address of the beneficial
owner. The statement may be made on
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an IRS Form W-8 or a substantially similar form, and the beneficial owner must
inform the Withholding Agent of any change in the information on the statement
within 30 days of such change. If a Note is held through a securities clearing
organization or certain other financial institutions, the organization or
institution may provide a signed statement to the Withholding Agent. However, in
such case, the signed statement must be accompanied by a copy of the IRS Form
W-8 or the substitute form provided by the beneficial owner to the organization
or institution. The Treasury Department is considering implementation of further
certification requirements aimed at determining whether the issuer of a debt
obligation is related to holders thereof.
Generally, a Non-U.S. Holder will not be subject to United States federal
income or withholding taxes on any amount of capital gain recognized by the
Non-U.S. Holder upon a sale, retirement or disposition of a Note, provided (i)
such capital gain is not effectively connected with the conduct of a trade or
business in the United States by the Non-U.S. Holder, and (ii) in the case of an
individual, the Non-U.S. Holder is not present in the United States for 183 days
or more in the taxable year in which the sale, retirement or disposition takes
place or certain other conditions are not met. Certain other exemptions may be
applicable, and a Non-U.S. Holder should consult its own tax advisor in this
regard. Proposed Treasury Regulations were published in the Federal Register on
April 22, 1996 regarding the withholding of United States tax on payments of
certain kinds of income to Non-U.S. Holders (the "Proposed Regulations"). If
finalized in their proposed form, these Proposed Regulations would make
significant changes to certain of the procedures and certification requirements
described above in order to secure reduction and/or an exemption from U.S.
withholding tax otherwise due with respect to payments to holders who are
Non-U.S. Holders. The Proposed Regulations are proposed to be generally
effective for payments made after December 31, 1997 without regard to the date
of issuance of the debt instrument with respect to which the payments are made.
Because of the uncertainty of the state of law in this area, prospective
investors who are Non-U.S. Holders should consult their own tax advisors with
respect to the possible impact of the Proposed Regulations on their particular
situation.
UNITED STATES ESTATE TAX CONSIDERATIONS
The Notes will not be includible in the estate of a Non-U.S. Holder unless
the individual is a direct or indirect 10% or greater shareholder of the
Corporation or, at the time of such individual's death, payments in respect of
the Notes would have been effectively connected with the conduct by such
individual of a trade or business in the United States.
FOREIGN CURRENCY NOTES
A holder who uses the cash method of accounting and who receives a payment
of interest (including qualified stated interest) in Foreign Currency with
respect to a Note (other than with respect to a Discount Note, except to the
extent any qualified stated interest is received) will be required to include in
income the U.S. dollar value of the Foreign Currency payment (determined based
on the "spot" exchange rate in effect on the date such payment is received)
regardless of whether the payment is in fact converted to U.S. dollars at that
time, and such U.S. dollar value will be the holder's tax basis in the Foreign
Currency.
A holder (to the extent the preceding paragraph is not applicable) will be
required to include in income the U.S. dollar value of the amount of interest
income (including original issue discount) that has accrued and is otherwise
required to be taken into account with respect to a Single Foreign Currency Note
during an accrual period. The U.S. dollar value of such accrued interest income
will be determined by translating such income at the average rate of exchange
for the accrual period or, with respect to an interest accrual period that spans
two taxable years, at the average rate for the partial period within the taxable
year. The average rate of exchange for the interest accrual period (or partial
period) is the simple average of the "spot" exchange rates for each business day
of such period or other average exchange rate for the period if such rate is
reasonably derived and consistently applied by the taxpayer. Such holder may
elect to determine the U.S. dollar value of any interest income accrued in a
Foreign Currency under an alternative method, as described below under "Spot
Rate Convention Election." Such holder will recognize ordinary income or loss
with respect to Foreign Currency relating to accrued interest income on the date
such income is actually received. The amount of ordinary income or loss
recognized on the date such interest is actually received will equal the
difference
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<PAGE> 29
between the U.S. dollar value of the Foreign Currency payments received
(determined by using the "spot" exchange rate in effect on the date such payment
is received) in respect of such accrual period and the U.S. dollar value of the
interest income that has accrued during such accrual period as determined by
using one of the two conventions described above.
A holder will have a tax basis in any Foreign Currency received on the
sale, exchange or retirement of a Single Foreign Currency Note equal to the U.S.
dollar value of such Foreign Currency, determined by using the "spot" exchange
rate in effect at the time of such sale, exchange or retirement. Any gain or
loss realized by a holder on a sale or other disposition of Foreign Currency
(including its exchange for U.S. dollars or its use to purchase Single Foreign
Currency Notes) will be ordinary income or loss.
A holder's tax basis in a Single Foreign Currency Note, and the amount of
any subsequent adjustment to such holder's tax basis, will be the U.S. dollar
value of the Foreign Currency amount paid for such Single Foreign Currency Note,
or of the Foreign Currency amount of the adjustment, determined on the date of
such purchase or adjustment. A holder who converts U.S. dollars to a Foreign
Currency and immediately uses that currency to purchase a Single Foreign
Currency Note denominated in the same currency ordinarily will not recognize
gain or loss in connection with such conversion and purchase. However, a holder
who purchases a single Foreign Currency Note with previously owned Foreign
Currency will recognize ordinary income or loss in an amount equal to the
difference, if any, between such holder's tax basis in the Foreign Currency and
the U.S. dollar fair market value of the Single Foreign Currency Note on the
date of purchase.
Gain or loss realized with respect to principal upon the sale, exchange or
retirement of a Single Foreign Currency Note will be ordinary income or loss to
the extent it is attributable to fluctuations in currency exchange rates. Gain
or loss attributable to fluctuations in exchange rates will equal the difference
between the U.S. dollar value of the Foreign Currency principal amount of such
Note, determined by using the "spot" exchange rate in effect on the date such
payment is received or such Note is disposed of and the U.S. dollar value of the
Foreign Currency principal amount of such Note, determined by using the "spot"
exchange rate in effect on the date such Holder acquired such Note. The foreign
currency principal amount of a Single Foreign Currency Note generally equals the
issue price in foreign currency of such Note. Such foreign currency gain or loss
will be recognized only to the extent of the total gain or loss recognized by a
holder on the sale, exchange or retirement of the single Foreign Currency Note.
The source of exchange gain or loss will be determined by reference to the
residence of the holder or the "qualified business unit" of the holder on whose
books the Note is properly reflected. Any gain or loss recognized by such a
holder in excess of such foreign currency gain or loss will be capital gain or
loss (except in the case of an original issue Discount Note, to the extent of
any accrued original issue discount), and generally will be long-term capital
gain or loss if the holding period of the single Foreign Currency Notes exceeds
one year.
Any gain or loss which is treated as ordinary income or loss, as described
above, generally will not be treated as interest income or expense except to the
extent provided by administrative pronouncements of the Internal Revenue
Service.
The amount of original issue discount on a Foreign Currency Note is
determined in the relevant foreign currency. The amount of such original issue
discount that is taken into account currently under general rules applicable to
Notes other than single Foreign Currency Notes is to be determined for any
accrual period in the relevant foreign currency and then translated into U.S.
dollars on the basis of the average exchange rate in effect during such accrual
period (or, with respect to an accrual period that spans two taxable years, the
partial period within the taxable year) unless the holder elects to use the
alternative method, as described below under "Spot Rate Convention Election."
SPOT RATE CONVENTION ELECTION
For taxable years beginning after March 17, 1992, a United States Holder
may elect to translate foreign currency original issue discount (and, in the
case of an accrual basis United States Holder, accrued interest) into U.S.
dollars at the exchange rate in effect on the last day of an accrual period for
such original issue discount or interest, or in the case of the accrual period
that spans two taxable years, at the exchange rate in effect on the last day of
the partial period within the taxable year. Additionally, if a payment of
original issue
S-27
<PAGE> 30
discount or interest is actually received within five business days of the last
day of the accrual period or partial accrual period within the taxable year, an
electing United States Holder may instead translate such original issue discount
or accrued interest into U.S. dollars at the exchange rate in effect on the date
of such receipt. Any such election will apply to all debt instruments held by
the United States Holder at the beginning of the first taxable year to which the
election applies or thereafter acquired by the United States Holder, and will be
irrevocable without the consent of the Internal Revenue Service.
BACKUP WITHHOLDING AND INFORMATION REPORTING
Backup withholding of United States federal income tax may apply at a rate
of 31% to payments including original issue discount made in respect of the
Notes to holders who are not "exempt recipients" and who fail to provide and
certify certain identifying information (such as the holder's taxpayer
identification number) in the required manner. Generally, individuals are not
exempt recipients, whereas corporations and certain other entities generally are
exempt recipients. Payments made in respect of the Notes to a U.S. Holder must
be reported to the IRS, unless the U.S. Holder establishes that it is an exempt
recipient or otherwise establishes an exemption. Compliance with the
identification procedures described under "Non-U.S. Holders" generally would
establish an exemption from backup withholding for Non-U.S. Holders who are not
exempt recipients.
Any amounts withheld under the backup withholding rules from a payment to a
beneficial owner would be allowed as a refund or a credit against such
beneficial owner's United States federal income tax provided the required
information is furnished to the IRS.
If finalized in their current form, the Proposed Regulations would make
significant changes to the proceeding summary of backup withholding and
information reporting requirements. Thus, prospective investors who are Non-U.S.
Holders should consult their own tax advisors as to the potential tax
consequences to them of these Proposed Regulations.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER'S PARTICULAR
SITUATION. HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE TAX
CONSEQUENCES TO THEM OF THE OWNERSHIP AND DISPOSITION OF THE NOTES, INCLUDING
THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE
POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAWS.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuous basis by the Corporation
through Salomon Brothers Inc, Chase Securities Inc., Citicorp Securities, Inc.,
CS First Boston Corporation, Goldman, Sachs & Co. and J.P. Morgan Securities
Inc. (the "Agents"), each of which will agree to use its reasonable efforts to
solicit offers to purchase Notes. The Corporation will have the sole right to
accept offers to purchase Notes and may reject any offer to purchase Notes in
whole or in part. An Agent will have the right to reject any offer to purchase
Notes solicited by it in whole or in part. Payment of the purchase price of the
Notes will be required to be made in immediately available funds. Unless
otherwise specified in the applicable Pricing Supplement, with respect to Notes
with a Stated Maturity of from nine months to 30 years from the date of issue,
the Company will pay each Agent a commission, in the form of a discount ranging
from .125% to .750% of the principal amount of each Note, depending upon the
Stated Maturity, sold through such Agent. With respect to Notes with a Stated
Maturity that is longer than 30 years from the date of issue sold through any
Agent, the rate of commission will be negotiated at the time of sale and will be
specified in the applicable Pricing Supplement. The Corporation may appoint
additional agents to solicit sales of the Notes or accept (but not solicit)
offers from additional agents for the sale of Notes; provided that any such
solicitation and sale of the Notes shall be on the same terms and conditions as
the Agents have agreed to. The Corporation may also sell Notes directly to
investors on its own behalf. In the case of sales made directly by the
Corporation, no commission will be payable.
S-28
<PAGE> 31
The Corporation may also sell Notes to an Agent as principal for its own
account or to a group of underwriters for whom an Agent acts as representative
at discounts or premiums to be agreed upon at the time of sale. Such Notes may
be resold to investors and other purchasers at prevailing market prices, or
prices related thereto at the time of such resale, at negotiated prices or
otherwise, as determined by the Agent. In addition, the Agents may offer the
Notes they have purchased as principal to other dealers. The Agents may sell
Notes to any dealer at a discount and, unless otherwise specified in the
applicable Pricing Supplement, such discount allowed to any dealer will not be
in excess of the discount received by such Agent from the Corporation unless
otherwise specified in the applicable Pricing Supplement. After the initial
public offering of Notes to be resold to investors and other purchasers on a
fixed public offering price basis, the public offering price, concession and
discount may be changed.
An Agent may be deemed to be an "underwriter" within the meaning of the
Securities Act. The Corporation and the Agents have agreed to indemnify each
other against certain liabilities, including liabilities under the Securities
Act, or to contribute to payments made in respect thereof. The Corporation has
also agreed to reimburse the Agents for certain expenses, including the fees and
expenses of counsel.
The Corporation does not intend to apply for the listing of the Notes on
any national or regional securities exchange. The Corporation has been advised
by the Agents that the Agents intend to make a market in the Notes, as permitted
by applicable laws and regulations. The Agents are not obligated to do so,
however, and the Agents may discontinue making a market at any time without
notice. No assurance can be given as to the liquidity of any trading market for
the Notes.
Concurrently with the offering of Notes through the Agents as described
herein, the Corporation may issue other Securities as described in the
accompanying Prospectus.
In the ordinary course of their respective businesses, certain of the
Agents and their affiliates have engaged, and may in the future engage, in
investment banking and commercial banking transactions with the Corporation and
certain of its affiliates.
VALIDITY OF THE NOTES
The validity of the Notes will be passed upon for the Corporation by any
Senior Managing Counsel to the Corporation authorized to render an opinion in
the State of Ohio, and for the Agents by Shearman & Sterling, New York, New
York. The Senior Managing Counsel to the Corporation will rely as to all matters
of New York law upon the opinion of Shearman & Sterling. Shearman & Sterling
will rely as to all matters of Ohio law upon the opinion of the Senior Managing
Counsel to the Corporation. Thompson Hine & Flory P.L.L. will pass on certain
tax matters related to the Notes. See "United States Tax Considerations."
The opinion of the Senior Managing Counsel to the Corporation and Shearman
& Sterling will be conditioned upon, and subject to certain assumptions
regarding, future action required to be taken by the Corporation and the Trustee
in connection with the issuance and sale of Notes, the specific terms of Notes
and other matters which may affect the validity of Notes but which cannot be
ascertained on the date of such opinions. As of July 31, 1996, attorneys at
Thompson Hine & Flory P.L.L. owned an aggregate of approximately 55,050 common
shares of the Corporation. In addition, as of July 31, 1996, the Senior Managing
Counsel to the Corporation currently authorized to render the opinion on behalf
of the Corporation owned approximately 5,300 common shares of the Corporation,
including stock options which were immediately exercisable.
S-29
<PAGE> 32
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<PAGE> 33
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 AN 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 AUGUST , 1996
PROSPECTUS
KEYCORP
<TABLE>
<S> <C>
DEBT SECURITIES DEBT WARRANTS
PREFERRED STOCK PREFERRED STOCK WARRANTS
DEPOSITARY SHARES DEPOSITARY SHARE WARRANTS
COMMON SHARES COMMON SHARE WARRANTS
</TABLE>
CAPITAL SECURITIES
KeyCorp, an Ohio corporation (the "Corporation"), intends to issue from time
to time, either separately or together, (i) one or more series of its unsecured
debt securities, which may be either senior debentures, notes, bonds and/or
other evidences of indebtedness (the "Senior Debt Securities") or subordinated
debentures, notes, bonds and/or other evidences of indebtedness which may be
convertible at the option of a holder or the Corporation into Capital Securities
(as described herein) of the Corporation (the "Subordinated Debt Securities"
and, together with the Senior Debt Securities, the "Debt Securities"), (ii)
warrants to purchase Debt Securities (the "Debt Warrants"), (iii) shares of
Preferred Stock, with a par value of $1 each (the "Preferred Stock") which may
be convertible, at the option of the holder, into Common Shares or any other
class or series of Capital Securities of the Corporation or convertible at the
option of the Corporation into Capital Securities or other debt securities of
the Corporation, (iv) shares of Preferred Stock represented by depositary shares
("Depositary Shares"), (v) warrants to purchase shares of Preferred Stock (the
"Preferred Stock Warrants"), (vi) warrants to purchase Depositary Shares (the
"Depositary Share Warrants"), (vii) Common Shares, with a par value of $1 each
(the "Common Shares"), together with the related rights to purchase Common
Shares (the "Rights") and (viii) warrants to purchase Common Shares, together
with the Rights (the "Common Share Warrants," and together with the Debt
Warrants, the Preferred Stock Warrants, and the Depositary Share Warrants, being
collectively referred to herein as the "Securities Warrants"), in amounts, at
prices, and on terms to be determined at the time of the offering. The Debt
Securities, Securities Warrants, Preferred Stock, Depositary Shares, and Common
Shares offered hereby, together with the Capital Securities, are collectively
referred to herein as the "Securities."
The Securities offered pursuant to this Prospectus may be offered separately
or together in one or more series up to an aggregate initial public offering
price of $1,261,500,000 or the equivalent thereof in one or more foreign
currencies or units of one or more foreign currencies or composite currencies
(such as European Currency Units), at individual prices and on terms to be set
forth in one or more supplements to this Prospectus (each, a "Prospectus
Supplement"). The particular terms of the Securities offered by any Prospectus
Supplement will be described in the Prospectus Supplement relating to such
Securities (an "Applicable Prospectus Supplement").
The Senior Debt Securities, when issued, will rank equally with all other
unsubordinated and unsecured indebtedness of the Corporation. The Subordinated
Debt Securities will be subordinate to all existing and future Senior
Indebtedness (as defined herein) of the Corporation and, in certain events
involving the insolvency of the Corporation, to Other Senior Obligations (as
defined herein) of the Corporation. See "Description of Debt
Securities -- Subordination of Subordinated Debt Securities." The Debt
Securities of any series may be issued with Securities Warrants, and, in the
case of the Subordinated Debt Securities, may be convertible into Capital
Securities of the Corporation. Unless otherwise indicated in a Prospectus
Supplement, the maturity of the Subordinated Debt Securities will be subject to
acceleration only in the event of certain events of bankruptcy, insolvency, or
reorganization of the Corporation or upon receivership of a Major Bank (as
defined herein). See "Description of Debt Securities -- Subordination of
Subordinated Debt Securities."
The specific terms of the Securities in respect of which this Prospectus is
being delivered will be set forth in a Prospectus Supplement and, among other
things, will include, where applicable, (i) in the case of Debt Securities, the
specific designation, aggregate principal amount, currency, denomination,
maturity, priority, premium, if any, rate of interest (which may be variable or
fixed), time of payment of interest, terms for optional redemption or repayment
by the Corporation or any holder and for sinking fund payments, terms for
conversion, the initial public offering price, any special provisions related to
Debt Securities denominated in a foreign currency or issued as medium-term
notes, original issue discount securities, or with other special terms, and the
designation of any applicable trustee, security registrar, or paying agent, (ii)
in the case of shares of Preferred Stock, the specific title and stated value,
number of shares or fractional interests therein, any dividend, liquidation,
redemption, voting, and other rights, the terms for conversion, the initial
public offering price, and whether such shares are to be issued as Depositary
Shares, and, if so, the fraction of a share to be represented by each Depositary
Share and the designation of the Depositary (as defined herein), (iii) in the
case of Common Shares, the aggregate number of shares offered and the initial
offering price, and (iv) in the case of Securities Warrants, where applicable,
the applicable type and amount of securities covered thereby, and, where
applicable, the aggregate amount, duration, offering price, exercise price, and
detachability.
A Prospectus Supplement will also contain information, where applicable,
about certain U.S. Federal income tax, accounting, and other considerations
relating to, and any listing on a securities exchange of, the Securities covered
by the Prospectus Supplement.
THE SECURITIES WILL BE OBLIGATIONS OF THE CORPORATION, ARE NOT AND WILL NOT
BE SAVINGS ACCOUNTS, DEPOSITS, OR OTHER OBLIGATIONS OF ANY BANK OR NONBANK
SUBSIDIARY OF THE CORPORATION, AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE BANK INSURANCE FUND, THE SAVINGS ASSOCIATION
INSURANCE FUND, OR ANY OTHER GOVERNMENT AGENCY OR INSTRUMENTALITY.
------------------------
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 Securities may be sold to underwriters pursuant to the terms of the
offering fixed at the time of sale, directly by the Corporation, or through
dealers or agents designated from time to time by the Corporation, which agents
may be affiliates of the Corporation. Each Prospectus Supplement will set forth
the names of the underwriters, dealers or agents, if any, and any applicable
fees, commissions or discounts and the net proceeds to the Corporation from such
sale together with the terms of the offering. The Corporation may also issue
contracts under which the counterparty may be required to purchase Debt
Securities, Preferred Stock, or Depositary Shares. Such contracts would be
issued with the Debt Securities, Preferred Stock, Depositary Shares and/or
Securities Warrants in amounts, at prices, and on terms to be set forth in a
Prospectus Supplement. See "Plan of Distribution."
THE DATE OF THIS PROSPECTUS IS AUGUST , 1996.
<PAGE> 34
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements, and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements, and other information filed by the Corporation can be inspected and
copied at the public reference facilities maintained by the Commission at Room
1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's regional offices at Northwestern Atrium Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center,
Thirteenth Floor, New York, New York 10048. Copies of such materials can be
obtained at prescribed rates by writing to the Securities and Exchange
Commission, Public Reference Section, 450 Fifth Street, N.W., Washington, D.C.
20549. The Commission maintains a Web site (http://www.sec.900) that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission. Certain securities of
the Corporation are listed on the New York Stock Exchange, and such reports,
proxy statements and other information concerning the Corporation also may be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005.
This Prospectus constitutes part of a registration statement on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Corporation with the Commission under the Securities
Act of 1933, as amended (the "Securities Act"). This Prospectus does not contain
all of the information set forth in the Registration Statement, certain parts of
which are omitted from this Prospectus in accordance with the rules and
regulations of the Commission. Reference is made to the Registration Statement
and to the exhibits thereto for further information pertaining to the
Corporation and the Securities offered hereby. The Registration Statement (and
exhibits thereto) may be inspected without charge at the office of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and copies thereof
may be obtained from the Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are hereby incorporated by reference in this Prospectus the following
documents and information heretofore filed by the Corporation with the
Commission pursuant to Sections 12 or 13 of the Exchange Act:
1. The Corporation's Annual Report on Form 10-K for the year ended
December 31, 1995;
2. The Corporation's Quarterly Reports on Form 10-Q for the periods
ended March 31, 1996 and June 30, 1996;
3. The Corporation's Current Reports on Form 8-K, filed on January 19,
1996, April 22, 1996 and July 18, 1996;
4. The description of the Corporation's Common Shares and the Rights
to purchase Common Shares contained in the Corporation's Registration
Statement on Form 8-A filed July 31, 1992, as amended by Form 8-A/A filed
on February 25, 1994 under Section 12 of the Exchange Act; and
All reports subsequently filed by the Corporation pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of the
offering of the Securities offered hereby shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the date of filing
of such documents. Any statement contained herein or in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this Prospectus to the extent that a statement
contained herein or in a Prospectus Supplement, or in any other subsequently
filed document which also is or is deemed to be incorporated by reference
herein, modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
THE CORPORATION WILL PROVIDE UPON REQUEST AND WITHOUT CHARGE TO EACH PERSON
TO WHOM THIS PROSPECTUS IS DELIVERED A COPY OF ANY OR ALL OF THE FOREGOING
DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN EXHIBITS TO SUCH
DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED THEREIN BY REFERENCE). WRITTEN
REQUESTS
2
<PAGE> 35
SHOULD BE DIRECTED TO THOMAS C. STEVENS, EXECUTIVE VICE PRESIDENT, GENERAL
COUNSEL AND SECRETARY, KEYCORP, 127 PUBLIC SQUARE, CLEVELAND, OHIO 44114-1306
(TELEPHONE (216) 689-6300).
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR
THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
CORPORATION OR ANY UNDERWRITER OR AGENT. THIS PROSPECTUS MAY NOT BE USED TO
CONSUMMATE SALES OF THE SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS
SUPPLEMENT. THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
OTHER THAN THE REGISTERED SECURITIES TO WHICH THEY RELATE AND DO NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES IN
ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS OR
ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF OR THEREOF OR THAT THE
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN OR THEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO SUCH DATE.
UNLESS OTHERWISE INDICATED, CURRENCY AMOUNTS IN THIS PROSPECTUS AND ANY
PROSPECTUS SUPPLEMENT ARE STATED IN U.S. DOLLARS ("$," "DOLLARS," "U.S.
DOLLARS," OR "U.S.$").
3
<PAGE> 36
THE CORPORATION
OVERVIEW
The Corporation was formed on March 1, 1994, when "old KeyCorp," a bank
holding company headquartered in Albany, New York, with approximately $33
billion in assets at December 31, 1993, merged into and with Society
Corporation, a bank holding company headquartered in Cleveland, Ohio
("Society"), with approximately $27 billion in assets at December 31, 1993. In
the merger, Society, an Ohio corporation, was the surviving corporation, but
changed its name to KeyCorp. The merger was accounted for as a pooling of
interests. Accordingly, all financial data of KeyCorp set forth herein (or
incorporated by reference) has been restated to give effect to the merger of old
KeyCorp into and with Society. At June 30, 1996, KeyCorp was one of the nation's
largest bank holding companies, based upon consolidated total assets of
approximately $64.8 billion.
KeyCorp is a legal entity separate and distinct from its banking and other
subsidiaries. Accordingly, the rights of KeyCorp, its security holders and its
creditors to participate in any distribution of the assets or earnings of its
banking and other subsidiaries is necessarily subject to the prior claims of the
respective creditors of such banking and other subsidiaries, except to the
extent that claims of KeyCorp in its capacity as a creditor of such banking and
other subsidiaries may be recognized.
The executive offices of KeyCorp are located at 127 Public Square,
Cleveland, Ohio 44114-1306, and its telephone number is (216) 689-6300.
SUBSIDIARIES
KeyCorp provides a wide range of banking, fiduciary and other financial
services to its corporate, individual and institutional customers through four
primary lines of business: Corporate Banking, National Consumer Finance,
Community Banking and Key PrivateBank (Personal Financial Services). These
services are provided across much of the country through a network of banking
subsidiaries operating 1,239 full-service banking centers, a 24-hour telephone
banking call center services group and approximately 1,452 automated teller
machines in 14 states as of June 30, 1996. KeyCorp's largest banking
subsidiaries include KeyBank National Association, headquartered in Cleveland,
Ohio, which is one of the nation's major regional banks with $27.1 billion in
total assets and 391 full-service banking offices in Indiana, Michigan and Ohio
at June 30, 1996; Key Bank of New York, headquartered in Albany, New York, with
$14.8 billion in total assets and 317 full-service banking offices at June 30,
1996 ("Key-NY"); and Key Bank of Washington, headquartered in Tacoma,
Washington, with $7.7 billion in total assets and 176 full-service banking
offices at June 30, 1996 ("Key-Washington"). In addition, KeyCorp operates bank
subsidiaries in Alaska, Colorado, Idaho, Maine, Oregon, Utah, Vermont and
Wyoming, a private bank in Florida, and either a trust company subsidiary or an
office of a trust company subsidiary in each of the aforementioned states except
Vermont.
In addition to the customary banking services of accepting deposits and
making loans, KeyCorp's bank and trust company subsidiaries provide specialized
services tailored to specific markets, including personal and corporate trust
services, personal financial services, customer access to mutual funds, cash
management services, investment banking services and international banking
services. Through its subsidiary banks, trust companies and registered
investment adviser subsidiaries, KeyCorp provides investment management services
to institutional and individual clients, including large corporate and public
retirement plans, Taft-Hartley plans, foundations and endowments, and high net
worth individuals. Several of KeyCorp's investment management subsidiaries also
serve as investment advisers to KeyCorp's proprietary mutual funds.
KeyCorp also provides other financial services both in and outside of its
primary banking markets through its nonbank subsidiaries. These services include
accident and health insurance on loans made by subsidiary banks, venture capital
and small business investment financing services, equipment lease financing,
community development financing, stock transfer agent services, securities
underwriting and brokerage, automobile financing and other financial services.
KeyCorp is also an equity participant in a joint venture with a number of other
unaffiliated bank holding companies in Electronic Payment Services, Inc.
4
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USE OF PROCEEDS
Unless otherwise set forth in the Applicable Prospectus Supplement, the
Corporation intends to use the net proceeds from the sale of the Securities for
general corporate purposes, including investments in and advances to the
Corporation's banking and nonbanking subsidiaries, reduction of short-term
borrowings, investments, and financing possible future acquisitions including,
without limitation, the acquisition of banking and nonbanking companies and
financial assets and liabilities. All or a portion of the net proceeds from the
sale of the Securities may also be used to finance, in whole or in part, the
repurchase by the Corporation of shares of its outstanding common stock pursuant
to the Corporation's stock repurchase program announced on January 18, 1996 and
described in a Current Report on Form 8-K filed with the Commission on January
19, 1996, which is incorporated herein by reference (see "Incorporation of
Certain Documents by Reference"), and additional share repurchases undertaken
from time to time in connection with the Corporation's acquisition of banking
and nonbanking companies.
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DESCRIPTION OF DEBT SECURITIES
The Senior Debt Securities are to be issued under an Indenture, dated as of
June 10, 1994 (the "Senior Indenture"), between the Corporation and Bankers
Trust Company, as Trustee. The Subordinated Debt Securities are to be issued
under an Indenture, dated as of June 10, 1994 (the "Subordinated Indenture"),
also between the Corporation and Bankers Trust Company, as Trustee. Copies of
the Senior Indenture and the Subordinated Indenture have been filed with the
Commission as exhibits to the Registration Statement of which this Prospectus is
a part. The Senior Indenture and the Subordinated Indenture are sometimes
referred to collectively herein as the "Indentures." Bankers Trust Company is
hereinafter referred to as the "Senior Trustee" when referring to it in its
capacity as trustee under the Senior Indenture, as the "Subordinated Trustee"
when referring to it in its capacity as trustee under the Subordinated
Indenture, and as the "Trustee" when referring to it in its capacity as trustee
under both of the Indentures. The following summaries of certain provisions of
the Senior Debt Securities, the Subordinated Debt Securities, and the Indentures
do not purport to be complete and are subject to, and are qualified in their
entirety by reference to, all the provisions of the Debt Securities and the
Indenture applicable to a particular series of Debt Securities (the "Applicable
Indenture"), including the definitions therein of certain terms. Wherever
particular Sections, Articles or defined terms of the Applicable Indenture are
referred to, it is intended that such Sections, Articles or defined terms shall
be incorporated herein by reference. Article and Section references used herein
are references to the Applicable Indenture. Capitalized terms not otherwise
defined herein shall have the meaning given to them in the Applicable Indenture.
The following sets forth certain general terms and provisions of the Debt
Securities offered hereby.
GENERAL TERMS
The Indentures provide that the Debt Securities issued thereunder may be
issued without limit as to aggregate principal amount and provide that Debt
Securities may be issued thereunder from time to time in one or more series. The
Senior Debt Securities will rank equally with all other unsecured and
unsubordinated indebtedness of the Corporation which is not accorded a priority
under applicable law. The Subordinated Debt Securities will rank equally with
all other unsecured indebtedness of the Corporation, but, as described below,
will be subordinated in right of payment to the prior payment in full of the
Senior Indebtedness of the Corporation and, in certain events involving the
insolvency of the Corporation, Other Senior Obligations of the Corporation. The
Debt Securities will be unsecured obligations of the Corporation.
Unless otherwise indicated in the Applicable Prospectus Supplement,
principal of (and premium, if any), or interest, if any, on the Debt Securities
will be payable, and the transfer of the Debt Securities will be registrable, at
the office or agency of the Corporation in the Borough of Manhattan, The City of
New York, maintained for such purpose and at any other office or agency
maintained by the Corporation for such purpose, except that, at the option of
the Corporation, interest may be paid by mailing a check to the address of the
person entitled thereto as it appears on the register for the Debt Securities or
by transfer to an account maintained with a bank located in the United States.
(Sections 301, 305, and 1002) Debt Securities of a series may be issuable solely
as Registered Securities, solely as Bearer Securities or as both Registered
Securities and Bearer Securities (both as defined in the Indentures). Unless
otherwise provided in the Applicable Prospectus Supplement, Debt Securities
denominated in U.S. dollars are issuable in denominations of $1,000 and integral
multiples of $1,000 (in the case of Registered Securities) and in denominations
of $5,000 (in the case of Bearer Securities). The Indentures also provide that
Debt Securities of a series may be issuable in global form, which may be of any
denomination. See "Book-Entry Procedures." Unless otherwise indicated in the
Applicable Prospectus Supplement, Bearer Securities will have interest coupons
attached. (Sections 201 and 302) No service charge will be made for any
registration of transfer or exchange of the Debt Securities, but the Corporation
may require payment of a sum sufficient to cover any tax or other governmental
charge imposed in connection therewith. (Section 305)
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The Applicable Prospectus Supplement will describe the following terms of
the Debt Securities offered thereby:
(1) The title of such Debt Securities and whether such Debt Securities
will be Senior Debt Securities or Subordinated Debt Securities.
(2) The aggregate principal amount of such Debt Securities and any
limit on the aggregate principal amount of Debt Securities of such series.
(3) If other than the principal amount thereof, the portion of the
principal amount thereof payable upon declaration of acceleration of the
maturity thereof or the method by which such portion shall be determined.
(4) The date or dates, or the method by which such date or dates will
be determined or extended, on which the principal of such Debt Securities
will be payable.
(5) The rate or rates at which such Debt Securities will bear
interest, if any, or the method by which such rate or rates will be
determined, the calculation agent, if any, the date or dates from which any
interest will accrue or the method by which such date or dates will be
determined, the date or dates on which such interest, if any, will be
payable and the regular record date or dates, if any, for the interest
payable on any registered security on any interest payment date, or the
method by which any such date will be determined, and the basis upon which
interest will be calculated if other than that of a 360-day year of twelve
30-day months.
(6) The period or periods within which, the price or prices at which,
the currency or currencies, currency unit or units or composite currency or
currencies in which, and the other terms and conditions upon which, such
Debt Securities may be redeemed in whole or in part at the option of the
Corporation, if the Corporation is to have that option.
(7) The obligation, if any, of the Corporation to redeem, repay or
purchase such Debt Securities in whole or in part, pursuant to any sinking
fund or analogous provision or at the option of a holder thereof and the
period or periods within which or the date or dates on which, the price or
prices at which, the currency or currencies, currency unit or units or
composite currency or currencies in which, and the other terms and
conditions upon which, such Debt Securities will be so redeemed, repaid or
purchased.
(8) Whether such Debt Securities are to be issuable as Registered
Securities, Bearer Securities or both, any restrictions applicable to the
offer, sale or delivery of Bearer Securities and the terms, if any, upon
which Bearer Securities of the series may be exchanged for Registered
Securities of the series and vice versa (if permitted by applicable laws
and regulations), whether such Debt Securities will be issuable initially
in temporary global form, whether any such Debt Securities will be issuable
in permanent global form with or without coupons and, if so, whether
beneficial owners of interests in any such permanent global security may
exchange such interests for Debt Securities of such series and of like
tenor of any authorized form and denomination and the circumstances under
which any such exchanges may occur, if other than in the manner provided in
the Applicable Indenture, and, if Registered Securities are to be issuable
as a global security, the identity of the depository for such Debt
Securities.
(9) If other than U.S. dollars, the currency or currencies, currency
unit or units or composite currency or currencies in which payments of the
principal of (and premium, if any) or interest, if any, on such Debt
Securities will be payable or in which such Debt Securities will be
denominated.
(10) Whether the amount of payments of principal of (and premium, if
any) and/or interest, if any, on such Debt Securities may be determined
with reference to an index, formula, or other method and the manner in
which such amounts will be determined.
(11) Whether the Corporation or a holder may elect payment of the
principal of (and premium, if any), or interest, if any, on such Debt
Securities in one or more currency or currencies, currency unit or units or
composite currency or currencies, other than that in which such Debt
Securities are denominated or stated to be payable, the period or periods
within which, and the terms and conditions upon which,
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such election may be made, and the time and manner of determining the
exchange rate between the currency or currencies, currency unit or units or
composite currency or currencies in which such Debt Securities are
denominated or stated to be payable and the currency or currencies in which
such Debt Securities are to be so payable.
(12) The place or places, if any, other than or in addition to The
City of New York, where the principal of (and premium, if any) or interest,
if any, on such Debt Securities will be payable, where any Registered
Securities may be surrendered for registration of transfer, where Debt
Securities may be surrendered for conversion and where notices or demands
to or upon the Corporation in respect of such Debt Securities and the
Applicable Indenture may be served.
(13) The denomination or denominations in which such Debt Securities
will be issuable, if other than $1,000 or any integral multiple thereof in
the case of Registered Securities and $5,000 or any integral multiple
thereof in the case of Bearer Securities.
(14) If other than the applicable Trustee, the identity of each
Security Registrar and/or Paying Agent.
(15) The date as of which any Bearer Securities of the series and any
temporary Debt Security issued in global form representing outstanding
Securities of the series will be dated if other than the date of original
issuance of the first Debt Security of the series to be issued.
(16) The applicability, if at all, to such Debt Securities of the
provisions of Article Thirteen of the respective Indenture described under
"Defeasance and Covenant Defeasance" and any provisions in modification of,
in addition to or in lieu of any of the provisions of such Article.
(17) The person to whom any interest on any Registered Security of the
series shall be payable, if other than the person in whose name such
Registered Security (or one or more predecessor securities) is registered
at the close of business on the Regular Record Date for such interest, the
manner in which, or the person to whom, any interest on any Bearer Security
of the series will be payable, if otherwise than upon presentation and
surrender of the coupons appertaining thereto as they severally mature, and
the extent to which, or the manner in which, any interest payable on a
temporary Debt Security issued in global form will be paid in other than in
the manner provided in the applicable Indenture.
(18) If such Debt Securities are to be issuable in definitive form
(whether upon original issue or upon exchange of a temporary Debt Security
of such series) only upon receipt of certain certificates or other
documents or satisfaction of other conditions, the form and/or terms of
such certificates, documents or conditions.
(19) If such Debt Securities will be issuable upon the conversion of
other Securities or upon the exercise of Debt Warrants, the time, manner,
and place for such Debt Securities to be authenticated and delivered.
(20) The provisions, if any, granting special rights to the holders of
such Debt Securities upon the occurrence of such events as may be
specified.
(21) Any deletions from, modifications of or additions to the Events
of Default and, in the case of the Subordinated Debt Securities, the
Defaults or covenants of the Corporation with respect to such Debt
Securities, whether or not such Events of Default, Defaults or covenants
are consistent with the Events of Default, Defaults or covenants set forth
in the general provisions of the Applicable Indenture.
(22) The designation of the initial Exchange Rate Agent, if any.
(23) Whether such Subordinated Debt Securities will be convertible
into Capital Securities of the Corporation and, if so, the terms and
conditions upon which such Subordinated Debt Securities will be so
convertible.
(24) Any other terms of such Debt Securities not inconsistent with the
provisions of the Applicable Indenture.
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The Corporation may be required to pay Additional Amounts, as contemplated
by Section 1004 of each Indenture, to any holder of Debt Securities who is not a
U.S. person (including any modification to the definition of such term as
contained in the Applicable Indenture as originally executed) in respect of
certain taxes, assessments, or governmental charges and, if so, the Corporation
may have the option to redeem such Debt Securities rather than pay such
Additional Amounts (and the terms of any such option). The Indentures provide
that "Additional Amounts" means any additional amounts which are required by the
Debt Securities or by or pursuant to a resolution of the Board of Directors to
be paid by the Corporation in respect of certain taxes imposed on such non-U.S.
persons and which are owing to such holders. If the terms of any series of Debt
Securities provide that the Corporation must pay Additional Amounts in respect
thereof, for purposes of this Prospectus, any reference to the payment of (or
premium, if any, on) or interest, if any, on such Debt Securities will be deemed
to include mention of the payment of Additional Amounts provided for by the
terms of such Debt Securities.
Debt Securities may provide for an amount less than the entire principal
amount thereof to be due and payable upon declaration of acceleration of the
maturity thereof ("Original Issue Discount Securities"). (Section 101) Certain
Federal income tax and other considerations pertaining to any such Original
Issue Discount Securities will be described in the Applicable Prospectus
Supplement.
The Debt Securities may be issued under the Indentures as Original Issue
Discount Securities to be offered and sold at a substantial discount from the
principal amount thereof and may also be issued under the Indentures upon
exercise of Debt Warrants issued by the Corporation. See "Description of
Securities Warrants."
Unless otherwise indicated in the Applicable Prospectus Supplement, the
covenants contained in the Indentures and the Debt Securities will not afford
holders protection in the event of a sudden decline in credit rating that might
result from a recapitalization, restructuring, or other highly leveraged
transaction.
BOOK-ENTRY PROCEDURES
Upon issuance, the Debt Securities may be issued in the form of one or more
fully registered global securities (the "Global Securities"). Each such Global
Security will be deposited with, or on behalf of, The Depository Trust Company,
as depository (the "Depository"), and registered in the name of the Depository
or a nominee thereof. Unless and until it is exchanged in whole or in part for
Debt Securities in definitive form, no Global Security may be transferred except
as a whole by the Depository to a nominee of such Depository or by a nominee of
such Depository to such Depository.
The Depository has advised the Corporation as follows: The Depository is a
limited-purpose trust company organized under the Banking Law of the State of
New York, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Exchange
Act. The Depository was created to hold securities of its participating
organizations ("Participants") and to facilitate the clearance and settlement of
transactions among its Participants in such securities through electronic
book-entry changes in accounts of the Participants, thereby eliminating the need
for physical movement of securities certificates. The Depository's Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations, some of which (and/or their
representatives) own the Depository. Access to the Depository's book-entry
system is also available to others, such as banks, brokers, dealers, and trust
companies that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly. The rules applicable to the
Depository and its Participants are on file with the Commission.
Ownership of beneficial interests in the Debt Securities will be limited to
Participants or persons that may hold interests through Participants
("Beneficial Owners"). The Depository has advised the Corporation that upon the
issuance of Global Securities representing the Debt Securities, the Depository
will credit, on its book-entry registration and transfer system, the
Participants' accounts with the respective principal amounts of the Debt
Securities beneficially owned by such Participants. Ownership of beneficial
interests in the Debt Securities represented by such Global Securities will be
shown on, and the transfer of such ownership interests
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will be effected only through, records maintained by the Depository (with
respect to interests of Participants) and on the records of Participants (with
respect to interests of Beneficial Owners). The laws of some states may require
that certain purchasers of securities take physical delivery of such securities
in definitive form. Such laws may impair the ability to own, transfer, or pledge
beneficial interests in Debt Securities represented by Global Securities.
So long as the Depository, or its nominee, is the registered owner of a
Global Security, the Depository or its nominee, as the case may be, will be
considered the sole owner or holder of the Debt Securities represented by such
Global Security for all purposes under the Applicable Indenture. Except as
provided below, Beneficial Owners will not be entitled to have the Debt
Securities represented by Global Securities registered in their names, will not
receive or be entitled to receive physical delivery of the Debt Securities in
definitive form, and will not be considered the owners or holders thereof under
the Applicable Indenture. Accordingly, each Participant must rely on the
procedures of the Depository and, if such person is a Beneficial Owner, on the
procedures of the Participant through which such Beneficial Owner owns its
interest, to exercise any rights of a holder under the Applicable Indenture. The
Corporation understands that under existing industry practices, in the event
that the Corporation requests any action of holders, or a Beneficial Owner
desires to give or take any action which a holder is entitled to give or take
under the Applicable Indenture, the Depository would authorize the Participants
holding the relevant beneficial interests to give or take such action, and such
Participants would authorize Beneficial Owners owning through such Participants
to give or take such action or would otherwise act upon the instructions of
Beneficial Owners holding through them.
Payment of principal of (and premium, if any) and interest, if any, owing
on Debt Securities registered in the name of the Depository or its nominee will
be made to the Depository or its nominee, as the case may be, as the holder of
such Debt Securities represented by the Global Securities. None of the
Corporation, the Trustee, or any other agent of the Corporation or agent of the
Trustee will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests or for
supervising or reviewing any records relating to such beneficial ownership
interests. The Corporation expects that the Depository, upon receipt of any
payment of principal, premium, if any, or interest in respect of Debt Securities
represented by Global Securities, will credit the accounts of the Participants
with payment in amounts proportionate to their respective beneficial interests
in the Debt Securities represented by such Global Securities as shown on the
records of the Depository. The Corporation also expects that payments by
Participants to Beneficial Owners will be governed by standing customer
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name," and
will be the responsibility of such Participants subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
principal (and premium, if any) and interest to the Depository is the
responsibility of the Corporation, disbursement of such payments to Participants
is the responsibility of the Depository, and disbursement of such payments to
the Beneficial Owners is the responsibility of the Participants.
If (a) the Depository notifies the Corporation that it is at any time
unwilling or unable to continue as depository for the Global Securities or the
Depository ceases to be a clearing agency registered under the Exchange Act, (b)
the Corporation executes and delivers to the Trustee an order of the Corporation
to the effect that the Global Securities shall be transferable and exchangeable
or (c) an Event of Default has occurred and is continuing with respect to the
Debt Securities, or any event which after notice or lapse of time, or both,
would constitute an Event of Default has occurred and is continuing, the Global
Securities will be transferable or exchangeable for Debt Securities in
definitive form of like tenor and of an equal aggregate principal amount, in
denominations of $1,000 and integral multiples thereof. Such definitive Debt
Securities shall be registered in such name or names as the Depository shall
instruct the Trustee. It is expected that such instructions may be based upon
directions received by the Depository from Participants with respect to
ownership of beneficial interests in Debt Securities represented by such Global
Securities.
In the event of an issuance of Global Securities, procedures for initial
settlement and secondary trades will be set forth in the Applicable Prospectus
Supplement.
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SUBORDINATION OF SUBORDINATED DEBT SECURITIES
Unless otherwise indicated in the Applicable Prospectus Supplement, the
following provisions shall apply to the Subordinated Debt Securities and the
Subordinated Indenture.
In 1992, the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board") issued an interpretation of its capital adequacy regulations,
and a clarification of such interpretation (collectively, the "Interpretation"),
that imposed additional restrictions on subordinated debt securities in order
for such securities to qualify as Tier II capital and which provided that
subordinated debt of bank holding companies issued on or after September 4, 1992
cannot qualify as Tier II capital unless the subordination of the debt meets
certain criteria, the subordinated debt is not subject to covenants and other
provisions inconsistent with safe and sound banking practices and the
subordinated debt may be accelerated only upon the bankruptcy of the bank
holding company or the receivership of a major banking subsidiary. The
Corporation's Subordinated Indenture entered into as of June 10, 1994 permits
the Corporation to issue Subordinated Debt Securities that qualify as Tier II
capital, subject to certain limits, in accordance with the Interpretation. Since
the Federal Reserve Board issued the Interpretation, the Corporation has issued
$467.5 million principal amount of such Subordinated Debt Securities, consisting
of $250.0 million of 7.50% Subordinated Notes due June 15, 2006, $200.0 million
of 6 3/4% Subordinated Notes due March 15, 2006 and $17.5 million of
Subordinated Medium-Term Notes, Series B, due November 7, 2005. In addition to
the Corporation's aforementioned Subordinated Debt Securities, as of June 30,
1996, all of the Old KeyCorp Subordinated Indebtedness (as defined below) and
the Society Subordinated Indebtedness (as defined below), which was incurred by
old KeyCorp and Society, respectively, prior to the issuance of the
Interpretation, continued to constitute, and be treated by the Corporation as,
Tier II capital.
The Subordinated Debt Securities will be direct unsecured subordinated
obligations of the Corporation and the indebtedness evidenced by the
Subordinated Debt Securities and the payment of the principal of, premium, if
any, and interest, if any, on the Subordinated Debt Securities will be
subordinated in right of payment to the extent described below to the prior
payment in full of all Senior Indebtedness. (Section 1601) In addition, no
payments shall be made by the Corporation on account of the Subordinated Debt
Securities if there shall have occurred and be continuing a default in any
payment with respect to any Senior Indebtedness, or an event of default with
respect to any Senior Indebtedness permitting the holders thereof to accelerate
the maturity thereof, or if any judicial proceeding shall be pending with
respect to any such default or event of default. (Section 1603) In certain
circumstances relating to an insolvency, bankruptcy, reorganization or similar
proceedings of or relating to the Corporation, or any liquidation, dissolution
or winding-up, or any assignment for the benefit of creditors or marshalling of
assets and liabilities, of the Corporation (an "insolvency event"), the payment
of the principal of, premium, if any, and interest, if any, on the Subordinated
Debt Securities also will be subordinated in right of payment to the extent
described below to the prior payment in full of all Other Senior Obligations (as
defined below). (Section 1614)
The Subordinated Indenture provides that "Senior Indebtedness" shall mean
the principal of (and premium, if any) and interest on (a) all indebtedness of
the Corporation for money borrowed, whether outstanding on the date of execution
of the Subordinated Indenture or thereafter created, assumed, incurred or
guaranteed, except (i) indebtedness on account of all Subordinated Debt
Securities issued under the Subordinated Indenture, indebtedness on account of
all Existing Subordinated Indebtedness (as defined below) and all indebtedness
which specifically by its terms ranks equally with and not prior to the
Subordinated Debt Securities or the Existing Subordinated Indebtedness in right
of payment upon an insolvency event and (ii) indebtedness which specifically by
its terms ranks junior to and not equally with or prior to indebtedness referred
to in clause (i) above in right of payment upon an insolvency event and (b) any
renewals, extensions, modifications and refundings of any such Senior
Indebtedness. The term "indebtedness of the Corporation for money borrowed"
shall mean the principal of (and premium, if any) and interest, if any, on all
(a) indebtedness of the Corporation (including indebtedness of others guaranteed
by the Corporation), whether outstanding on the date of the Subordinated
Indenture or thereafter created, incurred, assumed or guaranteed, which is for
money borrowed and (b) any renewals, extensions, modifications and refundings of
any such indebtedness. (Section 101) As of June 30, 1996, the Corporation had
outstanding approximately $1.0 billion aggregate principal amount of Senior
Indebtedness.
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The Subordinated Indenture provides that "Other Senior Obligations" shall
mean any obligation of the Corporation to its creditors, whether outstanding on
the date of execution of the Subordinated Indenture or thereafter created,
assumed, incurred or guaranteed, except (i) Senior Indebtedness, (ii)
indebtedness on account of all Subordinated Debt Securities issued under the
Subordinated Indenture, indebtedness on account of all Existing Subordinated
Indebtedness and all indebtedness which specifically by its terms ranks equally
with and not prior to the Subordinated Debt Securities or the Existing
Subordinated Indebtedness in right of payment upon the happening of an
insolvency event and (iii) indebtedness which specifically by its terms ranks
junior to and not equally with or prior to indebtedness referred to in clause
(ii) above in right of payment upon any insolvency event. (Section 101) As of
June 30, 1996, the Corporation had $296.0 million of Other Senior Obligations
outstanding.
The Subordinated Indenture does not limit or prohibit the incurrence of
additional Senior Indebtedness or Other Senior Obligations, and additional
Senior Indebtedness may include indebtedness of the Corporation for money
borrowed that is senior to the Subordinated Debt Securities, but subordinate to
other obligations of the Corporation. The Senior Debt Securities, if issued,
will constitute Senior Indebtedness.
The Subordinated Indenture provides that "Existing Subordinated
Indebtedness" shall include all indebtedness for borrowed money of the
Corporation under its 8.40% Subordinated Capital Notes due April 1, 1999
(originally issued by old KeyCorp and assumed by the Corporation), 8.125%
Subordinated Notes due June 15, 2002 (originally issued by Society), 8.00%
Subordinated Notes due July 1, 2004 (also originally issued by old KeyCorp and
assumed by the Corporation), Medium-Term Notes Series IV due 1998, 2000, 2002,
and 2003 (originally issued by old KeyCorp and assumed by the Corporation), and
any renewals, extensions, modifications and refundings of any such indebtedness.
All of the Existing Subordinated Indebtedness originally issued by old KeyCorp
and assumed by the Corporation as a result of the merger on March 1, 1994 is
referred to herein as "Old KeyCorp Subordinated Indebtedness" and all of the
Existing Subordinated Indebtedness originally issued by Society is referred to
herein as "Society Subordinated Indebtedness." As of June 30, 1996, the
Corporation had outstanding $565.0 million aggregate principal amount of
Existing Subordinated Indebtedness, which included $365.0 million aggregate
principal amount of Old KeyCorp Subordinated Indebtedness and $200.0 million
aggregate principal amount of Society Subordinated Indebtedness.
As of June 30, 1996, the Corporation also had outstanding $467.5 million of
Subordinated Debt Securities, consisting of $250.0 million of 7.50% Subordinated
Notes due June 15, 2006, $200.0 million of 6 3/4% Subordinated Notes due March
15, 2006 and $17.5 million of Subordinated Medium-Term Notes, Series B, due
November 7, 2005, all of which constitute Subordinated Debt Securities under the
Subordinated Indenture and as described herein, and none of which constitute
Existing Subordinated Indebtedness under the Subordinated Indenture.
The Society Subordinated Indebtedness is subordinated and subject in right
of payment, by its terms, to the prior payment in full of all "senior
indebtedness" (as defined in the indenture relating to the Society Subordinated
Indebtedness, generally, as indebtedness of the Corporation whenever created,
guaranteed, incurred, or assumed, for borrowed money, but excluding the Society
Subordinated Indebtedness and any other indebtedness as to which it is provided
in the instrument evidencing or creating such indebtedness that such
indebtedness is not superior in right of payment to the Society Subordinated
Indebtedness). The Old KeyCorp Subordinated Indebtedness is subordinate and
junior in right of payment, by its terms, to all "senior indebtedness" (as
defined in the indentures relating to the Old KeyCorp Subordinated Indebtedness,
generally, as any obligations of the Corporation to its creditors, whenever
incurred, other than Old KeyCorp Subordinated Indebtedness and any obligation as
to which, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is provided that such obligation is not "senior
indebtedness"). Because the Old KeyCorp Subordinated Indebtedness and the
Society Subordinated Indebtedness were issued by old KeyCorp and Society,
respectively, prior to the merger of old KeyCorp and Society, the relationship
between the Old KeyCorp Subordinated Indebtedness and the Society Subordinated
Indebtedness is not expressly provided for in the respective indentures relating
to such indebtedness.
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The Subordinated Indenture excludes Existing Subordinated Indebtedness from
the definition of Senior Indebtedness and, accordingly, the Subordinated Debt
Securities will not be subordinated in right of payment to Existing Subordinated
Indebtedness. The Subordinated Indenture also provides that the Subordinated
Debt Securities are not superior in right of payment to any of the Existing
Subordinated Indebtedness and do not constitute "senior indebtedness" as defined
in the indentures governing the Society Subordinated Indebtedness and the Old
KeyCorp Subordinated Indebtedness and, accordingly, the Subordinated Debt
Securities will not have the benefit of the subordination provisions contained
in such indentures.
Upon any payment or distribution of assets to creditors upon an insolvency
event relating to the Corporation, the holders of all Senior Indebtedness will
first be entitled to receive payment in full of all amounts due on or in respect
of all Senior Indebtedness before the holders of the Subordinated Debt
Securities will be entitled to receive any payment on account of the principal
of, premium, if any, or interest, if any, on the Subordinated Debt Securities
(Section 1602) or before the holders of Existing Subordinated Indebtedness will
be entitled to receive any payment on account of the principal of and interest
on such Existing Subordinated Indebtedness. In addition, upon any payment or
distribution of assets to creditors upon an insolvency event, the holders of all
Other Senior Obligations will first be entitled to receive payment in full of
all amounts due on or in respect of such Other Senior Obligations before the
holders of the Old KeyCorp Subordinated Indebtedness will be entitled to receive
any payment on account of the principal of and interest on the Old KeyCorp
Subordinated Indebtedness. If upon any such payment or distribution of assets to
creditors, after giving effect to such subordination provisions applicable to
the Subordinated Debt Securities and the Existing Subordinated Indebtedness in
favor of the holders of Senior Indebtedness and also, in the case of the Old
KeyCorp Subordinated Indebtedness, in favor of the holders of Other Senior
Obligations, there remain any amounts of cash, property, or securities available
for payment or distribution in respect of Subordinated Debt Securities ("Excess
Proceeds") and if, at such time, any Entitled Persons (as defined below) in
respect of Other Senior Obligations have not received payment in full of all
amounts due on or in respect of such Other Senior Obligations, then such Excess
Proceeds shall first be applied to pay or provide for the payment in full of
such Other Senior Obligations before any payment or distribution may be made in
respect of the Subordinated Debt Securities. (Section 1614) "Entitled Persons"
means persons who are entitled to payment pursuant to the terms of Other Senior
Obligations. (Section 101)
By reason of the subordination of the Subordinated Debt Securities in favor
of the holders of Senior Indebtedness and Other Senior Obligations, in the event
of a distribution of assets upon an insolvency event involving the Corporation,
the holders of the Subordinated Debt Securities may recover less than the
holders of Senior Indebtedness and the holders of Other Senior Obligations, and
as a result of the differences among the subordination provisions applicable to
the Society Subordinated Indebtedness, the Old KeyCorp Subordinated Indebtedness
and the Subordinated Debt Securities, including differences in the definitions
of senior indebtedness in the various indentures, in an insolvency event
involving the Corporation, any distribution of assets among the holders of
Society Subordinated Indebtedness, Old KeyCorp Subordinated Indebtedness and the
Subordinated Debt Securities may not be ratable.
OWNERSHIP OF VOTING STOCK OF SIGNIFICANT BANKS
The Senior Indenture provides that the Corporation will not sell or
otherwise dispose of, or grant a security interest in, or permit a Significant
Bank (as defined below) to issue, any shares of voting stock of such Significant
Bank (as defined below), unless the Corporation will own free of any security
interest at least 80% of the issued and outstanding voting stock of such
Significant Bank; provided, however, that the foregoing will not apply to (i)
any sale or disposition where the proceeds are invested, within 90 days thereof,
in any subsidiary (including any corporation which upon such investment becomes
a subsidiary) engaged in a banking business or any business legally permissible
for bank holding companies; provided, however, that if the proceeds are so
invested in any subsidiary engaged in a business legally permissible for bank
holding companies other than a banking business, the Corporation shall be
prohibited from selling or otherwise disposing of, or granting a security
interest in, or permitting such subsidiary to issue, any shares of voting stock
of such subsidiary to the same extent as if such subsidiary were a Significant
Bank if, upon making such investment, the assets of or held for the account of
such subsidiary constitutes 10% or more of the consolidated
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assets of the Corporation, or (ii) any disposition in exchange for stock of any
bank. (Section 1009) The term "Significant Bank" is defined in the Senior
Indenture as any directly or indirectly owned banking subsidiary of the
Corporation the assets of which constitute 10% or more of the consolidated
assets of the Corporation (currently, KeyBank National Association, Key Bank of
New York and Key Bank of Washington.) (Section 101)
The Subordinated Indenture does not contain a similar restriction on the
Corporation's ability to sell or otherwise dispose of or grant a security
interest in, or permit a Significant Bank to issue any shares of voting stock of
any Significant Bank because inclusion of such a provision, under the
Interpretation, would result in the Subordinated Debt Securities issued
thereunder not qualifying as Tier II capital. The holders of Society
Subordinated Indebtedness have the benefit of a covenant in the subordinated
indenture relating thereto substantially similar to the covenant described above
and the holders of Old KeyCorp Subordinated Indebtedness have the benefit of a
covenant in the subordinated indentures relating thereto that restricts the
sale, issuance or disposition of shares of stock of, or mergers or asset sales
involving, certain banking subsidiaries. In order to conform to the
Interpretation, the Subordinated Indenture does not contain either such
covenant.
EVENTS OF DEFAULT
The Senior Indenture. The Senior Indenture defines an "Event of Default"
(with respect to any series of Senior Debt Securities) as any one of the
following events: (a) default in the payment of any interest upon any Senior
Debt Security when such interest becomes due and payable, and continuance of
such default for a period of 30 days; (b) default in the payment of the
principal of (or premium, if any, on) any Senior Debt Security when due and
payable at its maturity; (c) default in the deposit of any sinking fund payment
when and as due; (d) failure to perform, or default in the performance or breach
of, any other covenant, warranty, or agreement of the Corporation in the Senior
Indenture (other than a default in the performance or breach of a covenant or
warranty or agreement included in the Senior Indenture solely for the benefit of
a series of Senior Debt Securities thereunder other than that series) and
continuance of such default or breach for a period of 60 days after the holders
of at least 25% in principal amount of the outstanding Senior Debt Securities of
such series have given written notice as provided in the Senior Indenture; (e)
acceleration of any indebtedness for borrowed money in an aggregate principal
amount exceeding $20 million of the Corporation or a Significant Bank if such
acceleration is not annulled within 10 days after written notice is given by the
holders of at least 25% in principal amount of the outstanding Senior Debt
Securities of such series requiring the Corporation to cause such acceleration
to be annulled as provided in the Senior Indenture; (f) certain events involving
the bankruptcy, insolvency, or reorganization of the Corporation or the
receivership or conservatorship of any Significant Bank, and (g) any other Event
of Default with respect to Senior Debt Securities of that series. (Section 501)
Under certain circumstances not involving a default in the payment of principal
of (premium, if any), or interest, if any, owing on the Senior Debt Securities
of any series, or in the payment of any sinking fund installment, the Senior
Trustee shall be protected in withholding notice to the holders of the Senior
Debt Securities of such series of a default if the Senior Trustee in good faith
determines that the withholding of such notice is in the interests of such
holders and the Senior Trustee shall withhold such notice for certain defaults
for a period of 60 calendar days. (Section 601)
If an Event of Default described in clauses (a), (b), (c), (d), (e) or (g)
above with respect to Senior Debt Securities of any series at the time
outstanding occurs and is continuing, either the Senior Trustee or the holders
of at least 25% in principal amount of the outstanding Senior Debt Securities of
that series may declare the principal amount (or, if the Senior Debt Securities
of that series are Original Issue Discount Debt Securities or Indexed
Securities, such portion of the principal amount as may be specified in the
terms thereof) of all the Senior Debt Securities of that series to be due and
payable immediately. If an Event of Default described in clause (f) above occurs
and is continuing, either the Senior Trustee or the holders of at least 25% in
principal amount of all outstanding Senior Debt Securities then outstanding may
declare the principal amount (or, if the Senior Debt Securities of any series
are Original Issue Discount Debt Securities or Indexed Securities, such portion
of the principal amount as may be specified in the terms thereof) of all the
Senior Debt Securities to be due and payable immediately. At any time after a
declaration of acceleration with
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respect to Senior Debt Securities of any series has been made and before a
judgment or decree for payment of the money due has been obtained, the holders
of a majority in principal amount of outstanding Senior Debt Securities of that
series may, under certain circumstances, rescind and annul such acceleration.
(Section 502)
The Subordinated Indenture. The Subordinated Indenture defines an "Event
of Default" (with respect to any series of Subordinated Debt Securities) as
certain (a) events involving the bankruptcy, insolvency, or reorganization of
the Corporation or the receivership of a Major Bank (as defined below) and (b)
any other Event of Default provided with respect to Subordinated Debt Securities
of that series. (Section 501) The term "Major Bank" is defined in the
Subordinated Indenture as any directly or indirectly owned banking subsidiary of
the Corporation, the consolidated assets of which constitute 75% or more of the
consolidated assets of the Corporation. As of the date of this Prospectus, no
banking subsidiary of the Corporation constitutes a Major Bank. If an Event of
Default described in clause (a) above occurs and is continuing, either the
Subordinated Trustee or the holders of not less than 25% in principal amount of
the outstanding Subordinated Debt Securities may declare the principal amount
(or, if the Subordinated Debt Securities of any series are Original Issue
Discount Debt Securities or Indexed Securities, such portion of the principal
amount as may be specified in the terms of that series) of all Subordinated Debt
Securities to be due and payable immediately. If an Event of Default described
in clause (b) above with respect to Subordinated Debt Securities of any series
at the time outstanding occurs and is continuing, either the Subordinated
Trustee or the holders of not less than 25% in principal amount of the
outstanding Subordinated Debt Securities of that series may declare the
principal amount (or, if the Subordinated Debt Securities of that series are
Original Issue Discount Debt Securities or Indexed Securities, such portion of
the principal amount as may be specified in the terms of that series) of all
Subordinated Debt Securities of that series to be due and payable immediately.
At any time after a declaration of acceleration with respect to Subordinated
Debt Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained, the holders of a majority in
principal amount of the outstanding Subordinated Debt Securities of that series
may, under certain circumstances, rescind and annul such acceleration. (Section
502)
Unless otherwise provided in the terms of a series of Subordinated Debt
Securities, there will be no right of acceleration of the payment of principal
of a series of Subordinated Debt Securities upon a default in the payment of
principal of (premium, if any), or interest, if any, owing on, or in the
performance of any covenant or agreement in, the Subordinated Debt Securities of
the particular series, or in the Subordinated Indenture.
In case a Default (as defined below) shall occur and be continuing, the
Subordinated Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the holders of Subordinated Debt Securities by
appropriate judicial proceeding as the Subordinated Trustee deems most
effective. The Subordinated Indenture defines a "Default" (with respect to any
series of Subordinated Debt Securities) as any one of the following events: (a)
an Event of Default; (b) default in the payment of any installment of interest,
if any, on any Subordinated Debt Security when such interest becomes due and
payable, and the continuance of such default for a period of 30 calendar days
(whether or not such payment is prohibited by the subordination provisions); (c)
default in payment of principal of (or premium, if any, on) any Subordinated
Debt Security at its maturity (whether or not such payment is prohibited by the
subordination provisions); (d) failure to deposit any sinking fund payment when
due; (e) failure to perform any other covenants or warranties of the Corporation
in the Subordinated Indenture (other than a covenant or warranty included in the
Subordinated Indenture solely for the benefit of a series of Subordinated Debt
Securities other than that series) continued for a period of 60 calendar days
after holders of at least 25% in principal amount of outstanding Subordinated
Debt Securities have given written notice as provided in the Subordinated
Indenture; and (f) any other Default specified in the Subordinated Indenture
with respect to Subordinated Debt Securities of that series. (Section 503) Under
certain circumstances not involving a default in the payment of principal of
(premium, if any), or interest, if any, owing on the Subordinated Debt
Securities of any series, or in the payment of any sinking fund installment, the
Subordinated Trustee shall be protected in withholding notice to the holders of
the Subordinated Debt Securities of such series of a default if the Subordinated
Trustee in good faith determines that the withholding of such notice is in the
interests of such holders and the Subordinated Trustee shall withhold such
notice for certain defaults for a period of 60 calendar days. (Section 601)
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In comparison to the Events of Default provided for in the Subordinated
Indenture and the subordinated indenture relating to the Old Key Subordinated
Indebtedness, the holders of Society Subordinated Indebtedness have the benefit
of broader events of default and related acceleration rights in the subordinated
indenture relating thereto, including, without limitation, any one of the
following "events of default" as defined in the subordinated indenture: (a)
default in the payment of any interest upon the Society Subordinated
Indebtedness when such interest becomes due and payable; (b) default in the
payment of principal of (or premium, if any, on) any Society Subordinated
Indebtedness when due and payable at its maturity; (c) default in the
performance, or breach, of any covenant or warranty of the Corporation; and (d)
acceleration of any indebtedness for borrowed money of the Corporation or a
principal bank (as defined in such subordinated indenture). In order to conform
to the Interpretation, the Subordinated Indenture does not contain any of such
events of default or acceleration rights.
Senior and Subordinated Indentures. Subject to the duty of the Trustee
during default to act with the required standard of care, under both the Senior
Indenture and the Subordinated Indenture, the applicable Trustee will be under
no obligation to exercise any of the rights or powers vested in it by the
Applicable Indenture at the request or direction of any of the holders of Debt
Securities of any series, unless such holders shall have offered to the Trustee
security or indemnity reasonably satisfactory to the Trustee. (Section 602)
Subject to such provisions for the indemnification of the Trustee and to certain
other conditions, the holders of a majority in aggregate principal amount of
outstanding Senior Debt Securities or outstanding Subordinated Debt Securities
of any series will have the right, subject to certain limitations, to direct the
time, method, and place of conducting any proceeding for any remedy available to
the Senior Trustee or Subordinated Trustee, respectively, or exercising any
trust or power conferred on the Senior Trustee or Subordinated Trustee,
respectively. (Section 512)
No holder of any series of Debt Securities will have any right to institute
any proceeding with respect to the Applicable Indenture, or for the appointment
of a receiver or trustee, or for any remedy thereunder, unless such holder shall
have previously given to the Trustee under the Applicable Indenture written
notice of a continuing Event of Default (in the case of Senior Debt Securities)
or a continuing Event of Default or Default (in the case of Subordinated Debt
Securities) and unless the holders of not less than 25% in principal amount of
the outstanding Debt Securities of that series shall have made written request,
and offered security or indemnity reasonably satisfactory to the Trustee, to
such Trustee to institute such proceeding as trustee, and such Trustee shall not
have received from the holders of a majority in aggregate principal amount of
the outstanding Debt Securities of that series a direction inconsistent with
such request and shall have failed to institute such proceeding within 60
calendar days. (Section 507) However, such limitations do not apply to a suit
instituted by a holder of a Debt Security for enforcement of payment of the
principal of (premium, if any) or subject to certain conditions, or interest, if
any, on or after the respective due dates expressed in such Debt Security.
(Section 508)
The Corporation is required to furnish to the Trustee annually a statement
as to the performance by the Corporation of certain of its obligations under the
Indentures and as to any default in such performance. (Section 1005)
MODIFICATION AND WAIVER
Modifications and amendments of each of the Senior Indenture and the
Subordinated Indenture may be made by the Corporation and the Trustee under the
Applicable Indenture with the consent of the holders of not less than 66 2/3% in
principal amount of the outstanding Debt Securities of each series issued under
such Indenture and affected by the modification or amendment; provided, however,
that no such modification or amendment may, without the consent of the holders
of each outstanding Debt Security of the series affected thereby, (1) change the
stated maturity of any principal of (or premium, if any), or any installment of
principal of or interest, if any, on, any Debt Security of such series; (2)
reduce the principal amount of, the rate of interest on, or any premium payable
upon the redemption of any, Debt Security of such series; (3) change any
obligation of the Corporation to pay Additional Amounts in respect of any Debt
Security of such series; (4) reduce the portion of principal of an Original
Issue Discount Security or Indexed Security that would be due and payable upon a
declaration of acceleration of the maturity thereof or provable in bankruptcy;
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(5) adversely affect any right of repayment at the option of the holder of any
Debt Security of such series; (6) change the place or currency or currencies of
payment of principal of or any premium or interest on any Debt Security of such
series; (7) impair the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof (or, in the case of redemption
or repayment, on or after any Redemption Date or Repayment Date, as the case may
be); (8) adversely affect the right to convert any Debt Security of such series
as may be provided pursuant to the Applicable Indenture; (9) in the case of the
Subordinated Indenture, modify the subordination provisions in a manner adverse
to the holders of the Subordinated Debt Securities of such series; (10) reduce
the percentage in principal amount of the outstanding Debt Securities, the
consent of whose holders is required for modification or amendment of the
Indenture or for waiver of compliance with certain provisions of the Indentures
or for waiver of certain defaults; (11) reduce the requirements for voting or
quorum relating to Bearer Securities; or (12) modify any of the provisions
relating to supplemental indentures requiring the consent of holders, relating
to the waiver of past defaults or relating to the waiver of certain covenants,
except to increase the percentage of such Outstanding Securities required for
such actions or to provide that certain other provisions of such Indenture
cannot be modified or waived without the consent of the holder of each
Outstanding Security affected thereby. (Section 902)
In addition, under the Subordinated Indenture, no modification or amendment
thereof may adversely affect the rights of any holder of Senior Indebtedness or
Other Senior Obligations under Article Sixteen of such Indenture (described
under the caption "Subordination of Subordinated Debt Securities") without the
consent of such holder of Senior Indebtedness or Other Senior Obligations.
(Subordinated Indenture Section 907)
The holders of at least 66 2/3% in principal amount of the outstanding
Senior Debt Securities of any series or outstanding Subordinated Debt Securities
of any series may, on behalf of all holders of the outstanding Senior Debt
Securities of that series or outstanding Subordinated Debt Securities of that
series, respectively, waive compliance by the Corporation with certain
restrictive provisions of the Applicable Indenture. (Senior Indenture Section
1010; Subordinated Indenture Section 1009) The holders of not less than 66 2/3%
in aggregate principal amount of the outstanding Senior Debt Securities of any
series or the outstanding Subordinated Debt Securities of any series may, on
behalf of all holders of the outstanding Senior Debt Securities of that series
or the outstanding Subordinated Debt Securities of that series, respectively,
waive any past default under the Applicable Indenture, except a default in the
payment of principal (or premium, if any), or interest, if any, or in the
performance of certain covenants. (Section 513)
SATISFACTION AND DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Corporation may discharge certain obligations to holders of Debt
Securities of a series that have not already been delivered to the applicable
Trustee for cancellation and that either have become due and payable or are by
their terms due and payable within one year (or scheduled for redemption within
one year) by irrevocably depositing with the applicable Trustee, in trust, funds
in an amount sufficient to pay the entire indebtedness on such Debt Securities
for principal (and premium, if any) and interest, with respect thereto, to the
date of such deposit (if such Debt Securities have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be. (Section 401)
Each Indenture provides that, if the provisions of Article Thirteen are
made applicable to the Debt Securities of or within a series pursuant to Section
301 thereunder, the Corporation may elect either (i) to defease and be
discharged from any and all obligations with respect to such Debt Securities
(except for the obligations to pay Additional Amounts, if any; to register the
transfer or exchange of such Debt Securities; to replace temporary or mutilated,
destroyed, lost or stolen Debt Securities; to maintain one or more offices or
agencies in respect of such Debt Securities; and to hold moneys for payment in
trust) ("defeasance") or (ii) to be released (a) in the case of any such Debt
Securities that are Senior Debt Securities, from its obligations under Section
1009 of such Indenture or (b) in the case of any such Debt Securities (whether
they are Senior Debt Securities or Subordinated Debt Securities), if so provided
in the Applicable Prospectus Supplement, from its obligations with respect to
any other covenant and, in the case of either (a) or (b) above, any omission to
comply with such obligations will not constitute a Default or an Event of
Default with respect to such Debt Securities ("covenant defeasance"), in either
case upon the irrevocable deposit by the
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Corporation with the applicable Trustee (or other qualifying trustee), in trust,
of (1) an amount, in the currency or currencies in which such Debt Securities
are then specified as payable at Stated Maturity, (2) Government Obligations (as
defined in the Indenture) applicable to such Debt Securities (with such
applicability being determined on the basis of the currency in which such Debt
Securities are then specified as payable at Stated Maturity) that, through the
payment of principal and interest in accordance with their terms, will provide
money in an amount or (3) a combination thereof in an amount, sufficient to pay
the principal of (and premium, if any, on) and interest, if any, on such Debt
Securities, and any mandatory sinking fund or analogous payments thereon, on the
scheduled due dates therefor.
Such a trust may only be established if, among other things, the
Corporation has delivered to the applicable Trustee an opinion of counsel to the
effect that the holders of such Debt Securities to be defeased will not
recognize income, gain or loss for U.S. Federal income tax purposes as a result
of such defeasance or covenant defeasance and will be subject to U.S. Federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance or covenant defeasance had not
occurred, and such opinion of counsel, in the case of defeasance under clause
(i) above, must refer to and be based upon a ruling of the Internal Revenue
Service or a change in applicable U.S. Federal income tax law occurring after
the date of the Applicable Indenture. (Article Thirteen)
Unless otherwise provided in the Applicable Prospectus Supplement, if,
after the Corporation has deposited funds, Government Obligations, or both to
effect defeasance or covenant defeasance with respect to Debt Securities of a
series, (a) the holder of a Debt Security of such series is entitled to, and
does, elect pursuant to the terms of such Debt Security to receive payment in a
currency or currency unit other than that in which such deposit has been made in
respect of such Debt Security or (b) a Currency Conversion Event (as defined in
the applicable Indenture) occurs, then the indebtedness represented by such Debt
Security will be deemed to have been, and will be, fully discharged and
satisfied through the payment of the principal of (and premium, if any) and
interest, if any, on such Debt Security as they become due out of the proceeds
yielded by converting the amount so deposited in respect of such Debt Security
into the currency in which such Debt Security becomes payable as a result of
such election or such Currency Conversion Event based on the applicable Market
Exchange Rate. (Section 1305) Unless otherwise provided in the Applicable
Prospectus Supplement, all payments of principal of (and premium, if any) and
interest, if any, on any Debt Security that is payable in a foreign currency
with respect to which a Currency Conversion Event occurs shall be made in U.S.
dollars. (Section 312)
In the event the Corporation effects covenant defeasance with respect to
any Debt Securities and such Debt Securities are declared due and payable
because of the occurrence of any Event of Default other than the Event of
Default described in clause (d) under "Events of Default" with respect to the
obligations described under "Ownership of Voting Stock of Significant Banks"
above (which obligations would no longer be applicable to such Debt Securities)
or described in clause (d) or (g) under "Events of Default" with respect to any
other covenant with respect to which there has been defeasance, the amount in
such currency in which such Debt Securities are payable, and Government
Obligations on deposit with the applicable Trustee will be sufficient to pay
amounts due on such Debt Securities at the time of their Stated Maturity but may
not be sufficient to pay amounts due on such Debt Securities at the time of the
acceleration resulting from such Event of Default. However, the Corporation
would remain liable to make payment of such amounts due at the time of
acceleration.
If the applicable Trustee or any Paying Agent is unable to apply any money
in accordance with the applicable Indenture by reason of any order or judgment
of any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Corporation's obligations under such
Indenture and such Debt Securities shall be revived and reinstated as though no
deposit had occurred pursuant to such Indenture, until such time as such Trustee
or Paying Agent is permitted to apply all such money in accordance with such
Indenture; provided, however, that, if the Corporation makes any payment of
principal of (or premium, if any) or interest on any such Debt Security or
coupon following the reinstatement of its obligations, the Corporation shall be
subrogated to the rights of the holders of such Debt Securities to receive such
payment from the money held by such Trustee or Paying Agent.
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The Applicable Prospectus Supplement may further describe the provisions,
if any, permitting defeasance or covenant defeasance, including any
modifications to the provisions described above, with respect to the Debt
Securities of or within a particular series and any related coupons.
CONSOLIDATION, MERGER, AND SALE OF ASSETS
The Corporation, without the consent of the holders of any of the Debt
Securities under the Indentures, may consolidate with or merge into any other
person, may convey, transfer, or lease its assets substantially as an entirety
to any person, or may permit any person to merge into or consolidate with the
Corporation or convey, transfer or lease its property and assets substantially
as an entirety to the Corporation, provided that: (1) any successor or purchaser
is a corporation organized under the laws of any domestic jurisdiction; (2) any
such successor or purchaser assumes the Corporation's obligations on such Debt
Securities and under the Indentures; (3) after giving effect to the transaction,
with respect to any Senior Debt Securities, no Event of Default and no event
which, after notice of or lapse of time or both would become an Event of Default
or, with respect to any Subordinated Debt Securities, no Default and no event
that, after notice or lapse of time, would become an Event of Default or a
Default, shall have occurred and be continuing; (4) with respect to the Senior
Indenture, if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, shares of voting stock of any Significant Bank
would become subject to a security interest not permitted under the Senior
Indenture, the Corporation or successor, as the case may be, shall take such
steps as shall be necessary effectively to secure the Senior Debt Securities
equally and ratably with (or prior to) all indebtedness secured thereby; and (5)
certain other conditions are met. (Section 801)
CONVERSION
The holders of Subordinated Debt Securities of a specified series that are
convertible into Capital Securities ("Subordinated Convertible Debt Securities")
may be entitled or, if so provided in the Applicable Prospectus Supplement, may
be required at such time or times specified in the Applicable Prospectus
Supplement relating to such Subordinated Convertible Debt Securities, subject to
prior redemption, repayment, or repurchase, to convert any Subordinated
Convertible Debt Securities of such series into Capital Securities, at the
conversion price set forth in such Applicable Prospectus Supplement, subject to
adjustment and to such other terms as are set forth in such Applicable
Prospectus Supplement. No separate consideration will be received for any
Capital Securities issued upon conversion of Subordinated Convertible Debt
Securities.
RISK FACTORS OF DEBT SECURITIES DENOMINATED IN FOREIGN CURRENCIES
Debt Securities denominated or payable in foreign currencies may entail
significant risks. These risks include, without limitation, the possibility of
significant fluctuations in the foreign currency market, the imposition of
foreign exchange controls, and potential illiquidity in the secondary market.
These risks will vary depending upon the currency involved. These risks may be
more fully described in the Applicable Prospectus Supplement.
CONCERNING THE TRUSTEE
Bankers Trust Company is Trustee under both the Senior Indenture and the
Subordinated Indenture. The Corporation and certain of its subsidiaries maintain
deposit accounts and conduct other banking transactions with Bankers Trust
Company in the ordinary course of business. Bankers Trust Company also serves as
trustee under a senior indenture of old KeyCorp.
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DESCRIPTION OF PREFERRED STOCK
The following description of the terms of the shares of Preferred Stock,
which sets forth certain general terms and provisions of the Preferred Stock to
which any Prospectus Supplement may relate, does not purport to summarize any
particular series of Preferred Stock. Certain terms of any offered series of
Preferred Stock will be described in the Applicable Prospectus Supplement
relating to such series of Preferred Stock. If so indicated in the Applicable
Prospectus Supplement, the terms of any series may differ from the terms set
forth below. The description of certain provisions of the Preferred Stock set
forth below does not purport to be complete and is subject to and qualified in
its entirety by reference to the Amended and Restated Articles of Incorporation
(the "Articles") and the Certificate of Amendment of the Amended and Restated
Articles of Incorporation of the Corporation that relates to a particular series
of Preferred Stock (the "Certificate") which will be filed with the Secretary of
State of the State of Ohio at or prior to the time of the sale of the related
series of Preferred Stock and which will be filed as an exhibit to or
incorporated by reference in the Registration Statement.
GENERAL
The Corporation is authorized by its Articles to issue from time to time up
to 25,000,000 shares of Preferred Stock, with a par value of $1 each. All shares
of Preferred Stock must be of equal rank and the express terms thereof must be
identical, except in respect of the terms that may be fixed by the Board of
Directors as described below, and each share of each series shall be identical
with all other shares of such series, except that in the case of a series as to
which dividends are cumulative, the dates from which dividends are cumulative
may vary to reflect differences in the dates of issue. The Preferred Stock will,
when issued against payment therefor, be fully paid and nonassessable. The
Corporation currently has no Preferred Stock issued and outstanding.
The Board of Directors is authorized by the Articles to cause shares of
Preferred Stock to be issued in one or more series and with respect to each such
series to fix: (1) the designation of the series, which may be by distinguishing
number, letter, or title; (2) the authorized number of shares of such series,
which number the Board of Directors may, except to the extent otherwise provided
in the creation of the series, from time to time, increase or decrease, but not
below the number of shares thereof then outstanding; (3) the dividend rate or
rates (which may be fixed or adjustable) of the shares of the series; (4) the
dates on which dividends, if declared, shall be payable and, in the case of
series on which dividends are cumulative, the dates from which dividends shall
be cumulative; (5) the redemption rights and price or prices, if any, for shares
of the series, (6) the amount, terms, conditions, and manner of operation of any
retirement or sinking fund to be provided for the purchase or redemption of
shares of the series; (7) the amounts payable on shares of the series in the
event of any liquidation, dissolution, or winding up of the affairs of the
Corporation; (8) whether the shares of the series shall be convertible into
Common Shares or shares of any other series or class, and, if so, the
specification of such other class or series, the conversion price or prices or
rate or rates, any adjustment thereof, and all other terms and conditions upon
which such conversion may be made; and (9) the restrictions, if any, upon the
issue of any additional shares of the same series or of any other class or
series. The Board of Directors is authorized to amend from time to time the
Articles fixing, with respect to any unissued shares of Preferred Stock, the
matters described in clauses (1) through (9). Each series of Preferred Stock
will be offered on such of the above terms and at such offering price as
specified in the Applicable Prospectus Supplement.
As described under "Depositary Shares" below, the Corporation may, at its
option, elect to offer Depositary Shares (evidenced by depositary receipts)
which will represent a fraction to be specified in the Applicable Prospectus
Supplement relating to the particular series of Preferred Stock of a share of
the particular series of Preferred Stock issued and deposited with the
Depositary (as defined below), in lieu of offering full shares of such series of
the Preferred Stock.
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CERTAIN DEFINITIONS
For the purposes of this Description of Preferred Stock:
Whenever reference is made to shares "ranking prior to the Preferred
Stock," such reference shall mean and include all shares of the Corporation in
respect of which the rights of the holders thereof either as to the payment of
dividends or as to distribution in the event of a liquidation, dissolution, or
winding up of the Corporation are given preference over the rights of the
holders of Preferred Stock.
Whenever reference is made to shares "on a parity with the Preferred
Stock," such reference shall mean and include all shares of the Corporation in
respect of which the rights of the holders thereof as to the payment of
dividends or as to distributions in the event of a liquidation, dissolution, or
winding up of the Corporation rank on an equality or parity with the rights of
the holders of Preferred Stock.
Whenever reference is made to shares "ranking junior to the Preferred
Stock," such reference shall mean and include all shares of the Corporation in
respect of which the rights of the holders thereof as to the payment of
dividends and as to distributions in the event of a liquidation, dissolution, or
winding up of the Corporation are junior or subordinate to the rights of the
holders of Preferred Stock.
DIVIDENDS
The holders of Preferred Stock of each series, in preference to the holders
of Common Shares and of any other class of shares of the Corporation ranking
junior to the Preferred Stock shall be entitled to receive, out of any funds
legally available for the payment of dividends and when and as declared by the
Board of Directors, cash dividends at the rates set forth in the Applicable
Prospectus Supplement, and no more, payable on the dividend payment dates fixed
for such series set forth therein (each, a "Dividend Payment Date"). If any date
specified as a Dividend Payment Date is not a business day, dividends, if
declared, on the Preferred Stock will be paid on the immediately succeeding
business day, without interest. Such rates may be fixed or variable. If
variable, the formula used for determining the dividend rate for each dividend
period will be set forth in the Applicable Prospectus Supplement. Dividends on
the Preferred Stock may be cumulative or non-cumulative as provided in the
Applicable Prospectus Supplement.
No full dividends may be paid upon, declared, or set apart for the payment
of dividends on shares ranking on a parity with or junior to the Preferred Stock
unless dividends shall have been paid or set apart for payment on the Preferred
Stock.
REDEMPTION
A series of Preferred Stock may be redeemable at any time, in whole or in
part, at the option of the Corporation or the holder thereof upon terms and at
the redemption prices set forth in the Applicable Prospectus Supplement relating
to such series.
RIGHTS UPON LIQUIDATION
The holders of shares of Preferred Stock of any series shall, in case of
liquidation, dissolution, or winding up of the Corporation, be entitled to
receive in full out of the assets of the Corporation, including its capital,
before any amount shall be paid or distributed among the holders of Common
Shares or any other shares ranking junior to the Preferred Stock, the amounts
set forth in the Applicable Prospectus Supplement with respect to shares of such
series, plus all accrued and unpaid dividends for such series, in accordance
with the terms set forth in the Applicable Prospectus Supplement.
CONVERSION
The holders of specified series of Preferred Stock may be entitled or, if
so provided in the Applicable Prospectus Supplement, may be required, to convert
such shares into Common Shares or any other class or series of Capital
Securities or, in the case of Preferred Stock that is convertible at the option
of the
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Corporation, other debt securities of the Corporation, at such conversion price
or prices and on such other terms as may be set forth in the Applicable
Prospectus Supplement relating to such series of Preferred Stock.
VOTING RIGHTS
The holders of Preferred Stock shall not be entitled to vote upon matters
presented to the shareholders, except as provided herein or as required by law.
If the Corporation shall fail to pay full cumulative dividends on any
series of Preferred Stock for six quarterly dividend payment periods, whether or
not consecutive, the number of directors will be increased by two, and the
holders of all outstanding series of Preferred Stock, voting as a single class
without regard to series, will be entitled to elect such additional two
directors until full cumulative dividends for all past dividend payment periods
on all series of Preferred Stock have been paid or declared and set apart for
payment or until non-cumulative dividends have been paid regularly for at least
one full year. Such right to vote separately as a class to elect directors
shall, when vested, be subject, always, to the same provisions for the vesting
of such right to elect directors separately as a class in the case of future
dividend defaults. At any time when such right to elect directors separately as
a class shall have so vested, the Corporation may, and upon the written request
of the holders of record of not less than 20% of the total number of shares of
the Preferred Stock of the Corporation then outstanding shall, call a special
meeting of shareholders for the election of such directors. In the case of such
a written request, such special meeting shall be held within 90 days after the
delivery of such request and, in either case, at the place and upon the notice
provided by law and in the Regulations of the Corporation, provided that the
Corporation shall not be required to call such a special meeting if such request
is received less than 120 days before the date fixed for the next ensuing annual
meeting of shareholders of the Corporation. Directors elected as aforesaid shall
serve until the next annual meeting of shareholders of the Corporation or until
their respective successors shall be elected and qualify. If, prior to the end
of the term of any director elected as aforesaid, a vacancy in the office of
such director shall occur during the continuance of a default in dividends on
any series of Preferred Stock by reason of death, resignation, or disability,
such vacancy shall be filled for the unexpired term by the appointment by the
remaining director or directors elected as aforesaid of a new director for the
unexpired term of such former director.
Under existing interpretations of the Federal Reserve Board, if the holders
of any series of Preferred Stock become entitled to vote for the election of
directors because dividends on such series are in arrears, such series may then
be deemed a "class of voting securities" and a holder of 25% or more of such
series (or a holder of 5% or more if such holder otherwise exercises a
"controlling influence" over the Corporation) may then be subject to regulation
as a bank holding company in accordance with the Bank Holding Company Act of
1956, as amended (the "BHCA"). In addition, at such time, (i) any bank holding
company or foreign bank with a United States presence may be required to obtain
the approval of the Federal Reserve Board under the BHCA to acquire or retain 5%
or more of such series and (ii) any person other than a bank holding company may
be required to obtain the approval of the Federal Reserve Board under the Change
in Bank Control Act of 1978 to acquire or retain 10% or more of such series.
The affirmative vote or consent of the holders of at least two-thirds of
the then outstanding shares of Preferred Stock, given in person or by proxy,
either in writing or at a meeting called for the purpose at which the holders of
Preferred Stock shall vote separately as a class, shall be necessary to effect
any amendment, alteration, or repeal of any of the provisions of the
Corporation's Articles or the Regulations of the Corporation which would be
substantially prejudicial to the voting powers, rights, or preferences of the
holders of Preferred Stock (but so far as the holders of Preferred Stock are
concerned, such action may be effected with such vote or consent); provided,
however, that neither the amendment of the Corporation's Articles to authorize
or to increase the authorized or outstanding number of shares of any class
ranking junior to or on a parity with the Preferred Stock, nor the amendment of
the Regulations so as to change the number of directors of the Corporation shall
be deemed to be substantially prejudicial to the voting powers, rights, or
preferences of the holders of Preferred Stock (and any such amendment referred
to in this proviso may be made without the vote or consent of the holders of the
Preferred Stock); and provided further that if such amendment, alteration, or
repeal would be substantially prejudicial to the rights or preferences of one or
more but not all then
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outstanding series of Preferred Stock, the affirmative vote or consent of the
holders of at least two-thirds of the then outstanding shares of the series so
affected shall be required.
The affirmative vote or consent of the holders of at least two-thirds of
the then outstanding shares of Preferred Stock, given in person or by proxy,
either in writing or at a meeting called for the purpose at which the holders of
Preferred Stock shall vote as a single class, shall be necessary to effect any
one or more of the following:
(a) The authorization of, or the increase in the authorized number of,
any shares of any class ranking prior to the Preferred Stock; or
(b) The purchase or redemption for sinking fund purposes or otherwise
of less than all of the then outstanding Preferred Stock except in
accordance with a purchase offer made to all holders of record of Preferred
Stock, unless all dividends on all Preferred Stock then outstanding for all
previous dividend periods shall have been declared and paid or declared and
funds therefor set apart and all accrued sinking fund obligations
applicable thereto shall have been complied with.
PREEMPTIVE RIGHTS
No holder of Preferred Stock is entitled as a matter of right to subscribe
for or purchase any part of any issue of shares of the Corporation, of any class
whatsoever, or any part of any issue of securities convertible into shares of
the Corporation, of any class whatsoever, and whether issued for cash, property,
services, or otherwise.
REPURCHASE OF SHARES
Subject to the express terms of any series of Preferred Stock, the
Corporation, by action of its Board of Directors and without action by its
shareholders, is authorized by its Articles to purchase any shares of any series
of Preferred Stock from time to time in accordance with the provisions of the
Ohio General Corporation Law. Such purchases may be made either in the open
market, or at public or private sales, in such manner and amounts and at such
price as the directors shall, from time to time, determine.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of certain
provisions of the Deposit Agreement (as defined below) and of the Depositary
Shares and Depositary Receipts (as defined below) does not purport to be
complete and is subject to, and qualified in its entirety by reference to, the
forms of Deposit Agreement and Depositary Receipt relating to each series of the
Preferred Stock, which are filed with the Commission as exhibits to the
Registration Statement of which this Prospectus is a part, copies of which may
be obtained from the Corporation upon request.
GENERAL
The Corporation may elect to offer fractional shares of Preferred Stock
rather than full shares of Preferred Stock. In such event, the Corporation will
cause depositary receipts ("Depositary Receipts") to be issued for Depositary
Shares, each of which will represent a fraction (to be set forth in the
Applicable Prospectus Supplement relating to a particular series of Preferred
Stock) of a share of a particular series of Preferred Stock as described below.
The shares of any series of Preferred Stock represented by Depositary
Shares will be deposited under a Deposit Agreement (the "Deposit Agreement")
between the Corporation and a bank or trust company selected by the Corporation
having its principal office in the United States and having a combined capital
and surplus of at least $50,000,000, and any successor as depositary (the
"Depositary"). Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fraction of a
share of Preferred Stock represented by such Depositary Share, to all the
rights, preferences, and
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privileges of the Preferred Stock represented thereby, including any and all
dividend, voting, redemption, conversion, and liquidation rights provided for in
the Certificate.
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the Deposit Agreement. Depositary Receipts will be distributed to
those persons purchasing the fractional shares of Preferred Stock in accordance
with the terms of the offering.
Pending the preparation of definitive Depositary Receipts, the Depositary
will, upon the written order of the Corporation or any holder of Preferred
Stock, execute and deliver temporary Depositary Receipts which are substantially
identical to, and entitle the holders thereof to all the benefits pertaining to,
the definitive Depositary Receipts. Definitive Depositary Receipts will be
prepared thereafter without unreasonable delay, and temporary Depositary
Receipts will be exchangeable for definitive Depositary Receipts upon surrender
of the temporary Depositary Receipts at the Depositary's principal office or
such other office or offices, if any, as the Depositary may designate, at the
Corporation's expense and without charge to the holder.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute cash dividends or other cash distributions
received in respect of the deposited shares of Preferred Stock, including any
cash received upon redemption of any shares of Preferred Stock, to the record
holders of Depositary Receipts relating to such Preferred Stock in such amounts
as are, as nearly as practicable, in proportion to the numbers of Depositary
Shares evidenced by the Depositary Receipts held by such holders.
In the event of a distribution other than in cash on the deposited shares
of Preferred Stock, the Depositary will distribute property received by it to
the record holders of Depositary Receipts in such amounts as are, as nearly as
practicable, in proportion to the numbers of such Depositary Shares evidenced by
the Depositary Receipts held by such holders, in any manner that the Depositary
and the Corporation may deem equitable and practicable for accomplishing such
distribution. If the Depositary, after consultation with the Corporation,
determines that such distribution cannot be made proportionately or that it is
otherwise not feasible to make such distribution, it may, with the approval of
the Corporation, adopt such method as it deems equitable and practicable for the
purpose of effecting such distribution, including the public or private sale of
the property received. The Depositary will distribute or make available for
distribution the net proceeds of any such sale to the holders entitled thereto.
REDEMPTION OF PREFERRED STOCK
A series of Preferred Stock may be redeemable at any time, in whole or in
part, at the option of the Corporation or the holder thereof, as set forth in
the Applicable Prospectus Supplement relating to such series of Preferred Stock.
Whenever the Corporation elects to redeem shares of Preferred Stock held by the
Depositary, the Depositary will redeem as of the same redemption date the number
of Depositary Shares representing shares of Preferred Stock so redeemed,
provided the Corporation shall have paid in full to the Depositary the
redemption price of the Preferred Stock to be redeemed. In the event of such a
redemption at the option of the Corporation, the Depositary Shares will be
redeemed from the proceeds received by the Depositary resulting from the
redemption of such Preferred Stock held by the Depositary. If fewer than all the
outstanding Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by the Depositary by lot or pro rata or by any other
equitable method, in each case as may be determined by the Corporation.
In addition, although Depositary Shares, as such, are not redeemable at the
option of the holder of Depositary Receipts evidencing Depositary Shares, such
holder may, if so specified in the Applicable Prospectus Supplement relating to
an offering of Depositary Shares, surrender Depositary Receipts with written
instructions to the Depositary to instruct the Corporation to cause the
redemption of any specified number of whole or fractional shares of Preferred
Stock represented by the Depositary Shares evidenced by such Depositary
Receipts. The Corporation will thereafter cause the redemption of the Preferred
Stock at the redemption price utilizing the same procedures as those provided
for delivery of Preferred Stock to effect such redemption.
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In the event of redemption at the option of either the Corporation or the
holders of Depositary Receipts, the redemption price per Depositary Share will
be equal to the applicable fraction of the redemption price per share paid in
respect of the shares of the deposited Preferred Stock so redeemed, plus any
other money and other property, if any, represented by each such Depositary
Share, including an amount equal to any accrued and unpaid dividends thereon to
the date of such redemption.
Unless the Corporation defaults in the payment of the redemption price of
any Preferred Stock called for redemption by the Corporation or the holder
thereof and unless otherwise specified in the Certificate, (i) from and after
the redemption date, all dividends in respect of the shares of Preferred Stock
called for redemption will cease to accrue, the Depositary Shares so called for
redemption shall no longer be deemed outstanding, and, except as set forth in
clause (ii) below, all rights of holders of such Depositary Shares shall
terminate except for the right to receive the redemption price thereof, and (ii)
in the case of any redemption at the option of the Corporation or at the option
of the holder, any rights of conversion in respect of such shares of Preferred
Stock shall terminate on the close of business on the redemption date.
CONVERSION OF PREFERRED STOCK AT THE OPTION OF THE CORPORATION
The holders of Depositary Shares may be obligated at any time or upon
maturity of the Preferred Stock represented by the Depositary Shares to convert
the Depositary Shares for the number of whole shares of Capital Securities or
other debt securities of the Corporation (as the case may be, in accordance with
the terms of such series of Preferred Stock) in proportion to the number of
shares of Preferred Stock represented by the Depositary Shares. Whenever the
Corporation exercises its option to convert shares of Preferred Stock held by
the Depositary in whole or in part, the Depositary will convert as of the same
conversion date the number of Depositary Shares representing shares of Preferred
Stock so converted provided the Corporation shall have issued and deposited with
the Depositary the Capital Securities or other debt securities for the Preferred
Stock to be converted and paid in full to the Depositary any accrued and unpaid
dividends thereon. In the event of such conversion at the option of the
Corporation, the Depositary Shares will be converted at a conversion rate per
Depositary Share equal to the applicable fraction of the conversion rate per
share then in effect in respect of the shares of deposited Preferred Stock so
converted as such conversion rate may be adjusted from time to time as provided
in the Certificate of Amendment, plus any other money and other property, if
any, represented by each such Depositary Share, including all amounts paid by
the Corporation in respect of dividends which on the conversion date have
accrued on the shares of Preferred Stock to be so converted and have not
theretofore been paid. If fewer than all the outstanding Depositary Shares are
to be converted, the Depositary Shares to be converted will be selected by the
Depositary by lot or pro rata or by any other equitable method, in each case as
may be determined by the Corporation.
From and after the dated fixed for conversion, all dividends in respect of
the shares of Preferred Stock called for conversion shall cease to accrue to the
extent set forth in the Certificate, any rights of conversion or redemption at
the option of the holders of the Depositary Shares represented by Depositary
Receipts evidencing the shares of Preferred Stock called for conversion shall
terminate at the close of business on such conversion date to the extent set
forth in the Certificate, the Depositary Shares called for conversion will no
longer be deemed to be outstanding, and all rights of the holders of the
Depositary Receipts evidencing the Depositary Shares will cease, except the
right to receive the securities payable upon such conversion and any money and
other property, if any, to which the holders of such Depositary Shares were
entitled upon such conversion upon surrender to the Depositary of the Depositary
Receipts evidencing such Depositary Shares.
CONVERSION OF PREFERRED STOCK AT THE OPTION OF THE HOLDER
The Depositary Shares, as such, are not convertible at the option of the
holder thereof into Common Shares or any other securities or property of the
Corporation. Nevertheless, if so specified in the Applicable Prospectus
Supplement relating to an offering of Depositary Shares, any holder of
Depositary Shares representing any series of Preferred Stock which is
convertible at the option of the holder, upon surrender of the Depositary
Receipts therefor and delivery of instructions to the Depositary, may cause the
Corporation to convert any specified number of shares of Preferred Stock
represented by the Depositary Shares evidenced by such Depositary Receipts into
the number of whole Common Shares or whole number of shares of any other
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class or series of Capital Securities of the Corporation (as the case may be, in
accordance with the terms of such series of Preferred Stock) as are issuable, as
provided in the Certificate upon conversion of such shares of Preferred Stock at
the conversion rate (as such term is defined in the Certificate) then in effect,
as such conversion rate may be adjusted by the Corporation from time to time as
provided in the Certificate. In the event that a holder delivers Depositary
Receipts to the Depositary for conversion which in the aggregate are convertible
either into less than one whole Common Share or one whole share of any other
class or series of Capital Securities or into any number of whole Common Shares
or whole shares of any other class or series of Capital Securities plus an
excess constituting less than one whole Common Share or one whole share of any
other class or series of Capital Securities, the holder shall receive payment in
lieu of such fractional Common Shares or fractional shares of such Capital
Securities.
WITHDRAWAL OF PREFERRED STOCK
Any holder of Depositary Receipts may, upon surrender of such Depositary
Receipts therefor to the Depositary (unless the related Preferred Stock has
previously been called for redemption or conversion at the option of the
Corporation), receive the number of whole shares of the related series of
Preferred Stock and any money and other property represented by such Depositary
Receipts. Holders of Depositary Receipts making such withdrawals will be
entitled to receive whole shares of Preferred Stock on the basis set forth in
the Applicable Prospectus Supplement for such series of Preferred Stock, but
holders of such whole shares of Preferred Stock will not thereafter be entitled
to deposit such Preferred Stock under the Deposit Agreement or to receive
Depositary Shares therefor. If the Depositary Shares represented by the
Depositary Receipts surrendered by the holder in connection with such withdrawal
exceed the number of Depositary Shares that represent the number of whole shares
of Preferred Stock to be withdrawn, the Depositary will deliver to such holder
at the same time a new Depositary Receipt evidencing such excess number of
Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of shares of the
Preferred Stock are entitled to vote, the Depositary will, as soon as
practicable thereafter, mail the information contained in such notice of meeting
to the record holders of the Depositary Receipts representing the Depositary
Shares relating to such Preferred Stock. Each record holder of such Depositary
Receipt on the record date (which will be the same date as the record date of
the Preferred Stock) will be entitled to instruct the Depositary as to the
exercise of the voting rights pertaining to the amount of Preferred Stock
represented by such holder's Depositary Shares. Upon the written request of a
record holder of such Depositary Receipt, the Depositary will, insofar as
practicable, vote or cause to be voted the amount of Preferred Stock represented
by such Depositary Shares evidenced by such Depositary Receipt in accordance
with such instructions, and the Corporation will agree to take all reasonable
actions which may be deemed necessary by the Depositary in order to enable the
Depositary to do so. The Depositary will abstain from voting shares of the
Preferred Stock to the extent it does not receive specific instructions from the
holder of Depositary Receipts evidencing the Depositary Shares representing such
Preferred Stock. The Depositary will not be required to exercise discretion in
voting any Preferred Stock represented by the Depositary Shares evidenced by
such Receipts.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time and from time to time be
amended by agreement between the Corporation and the Depositary in any respect
that they may deem necessary or desirable. However, any amendment which
materially and adversely alters the rights of the holders of Depositary Receipts
or which would be materially and adversely inconsistent with the rights granted
to the holders of the Preferred Stock will not be effective unless such
amendment has been approved by the holders of at least a majority of the
Depositary Shares then outstanding.
The Deposit Agreement automatically terminates if (i) all outstanding
Depositary Shares have been redeemed, converted, or withdrawn; (ii) each share
of Preferred Stock has been converted into Common Shares or shares of any other
class or series of Capital Securities; or (iii) there has been a final
distribution in
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respect of the Preferred Stock in connection with any liquidation, dissolution,
or winding up of the Corporation and such distribution has been distributed to
the holders of Depositary Receipts. The Deposit Agreement also may be terminated
by the Corporation at any time upon not less than 60 days prior written notice
to the Depositary, in which case the Depositary will, upon a date not later than
30 days after the date of such notice, deliver to the record holders, upon
surrender of the Depositary Receipts, such number of whole shares of Preferred
Stock as are represented by such Depositary Receipts. In the event that such
Depositary Receipts represent a fractional number of shares of Preferred Stock,
the Depositary will aggregate all interests in such fractional shares, and, with
the approval of the Corporation, adopt such method as it deems equitable and
practicable for the purpose of effecting the distribution of such interests,
including the public or private sale of the whole number of shares of Preferred
Stock so aggregated, or any part thereof, after which the Depositary will
distribute or make available for distribution to the holders of such Depositary
Receipts, as the case may be, the net proceeds of any such sale.
CHARGES OF DEPOSITARY AND OTHER TAXES AND CHARGES
The Corporation will pay all fees and expenses of the Depositary, and all
charges of the Depositary in connection with the initial deposit of the
Preferred Stock and the initial issuance of the Depositary Shares evidenced by
the Depositary Receipts, all withdrawals of shares of Preferred Stock by holders
of Depositary Shares, any redemption or conversion of the Preferred Stock at the
option of such holder and any redemption or conversion of the Preferred Stock at
the option of the Corporation. The Corporation will pay all transfer and other
taxes and governmental charges arising solely from the existence of the
depositary arrangements. Holders of Depositary Shares will pay such other
transfer and other taxes and governmental charges as are expressly provided in
the Deposit Agreement to be for their accounts.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to the Corporation
notice of its election to do so, and the Corporation may at any time remove the
Depositary by notice of such removal delivered to the Depositary, any such
resignation or removal to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment. Such successor Depositary
must be appointed within 60 calendar days after delivery of the notice of
resignation or removal and must be a bank or trust company having its principal
office in the United States and having a combined capital and surplus of at
least $50 million.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Receipts all
notices, reports and proxy solicitation material from the Corporation which are
delivered to the Depositary in its capacity as holder of Preferred Stock and
which the Corporation is required to furnish to the holders of the Preferred
Stock.
Neither the Depositary nor the Corporation will be liable to any holder of
any Depositary Receipt if it is prevented or delayed by reason of any present or
future law or regulation of the United States or of any other governmental
authority, or by reason of any present or future provision of the Articles or
the Certificate or by any other circumstance beyond its control in performing
its obligations under the Deposit Agreement or by reason of any exercise of, or
failure to exercise, any discretion provided for in the Deposit Agreement. The
obligations and liabilities of the Corporation to holders of Depositary Receipts
and the Depositary under the Deposit Agreement or any Depositary Receipt will be
limited to performance in good faith of such duties as are specifically set
forth in the Deposit Agreement and the Corporation and the Depositary will not
be obligated to appear in, prosecute, or defend any action, suit, or other
proceeding in respect of deposited shares of Preferred Stock, Depositary Shares,
or Depositary Receipts that in its opinion may subject it to expense or
liability unless satisfactory indemnity is furnished. The Depositary and the
Corporation may rely upon the written advice of counsel and the written advice
of and information provided by any accountant, any holders of Depositary
Receipts and any other persons believed by it in good faith to be competent to
give such advice or information and upon documents believed by it to be genuine
and to have been signed or presented by the proper party or parties.
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In the event the Depositary shall receive conflicting claims, requests, or
instructions from any holders of Depositary Receipts, on the one hand, and the
Corporation, on the other hand, the Depositary shall be entitled to act on such
claims, requests, or instructions received from the Corporation.
DESCRIPTION OF COMMON SHARES
The description of certain provisions of the Common Shares set forth below
does not purport to be complete and is subject to and qualified in its entirety
by reference to the Articles and the Regulations (i.e. by-laws) of KeyCorp which
are exhibits to the Registration Statement.
GENERAL
The Corporation's Common Shares as of June 30, 1996 consisted of
900,000,000 authorized shares, with a par value of $1 each, of which there were
230,979,017 shares outstanding (exclusive of treasury shares). The Common Shares
are traded on the New York Stock Exchange. The transfer agent and registrar for
the Common Shares is KeyCorp Shareholder Services, Inc., a wholly owned
subsidiary of KeyBank National Association.
Common Shares of the Corporation may be issued from time to time, in such
amounts and proportion and for such consideration as may be fixed by the Board
of Directors of the Corporation. No holder of Common Shares has any preemptive
or preferential rights to purchase or to subscribe for any shares of capital
stock or other securities which may be issued by the Corporation. The Common
Shares have no redemption or sinking fund provisions applicable thereto. Common
Shares do not have any conversion rights. The rights of holders of Common Shares
will be subject to, and may be adversely affected by, the rights of holders of
any Preferred Stock that may be issued in the future.
The Corporation may issue authorized but unissued Common Shares in
connection with several employee benefit and stock option and incentive plans
maintained by the Corporation or its subsidiaries, and the Corporation's
Automatic Dividend Reinvestment and Cash Payment Plan.
The outstanding Common Shares are fully paid and non-assessable and future
issuances of Common Shares, when fully paid for, will be non-assessable except
that in both cases Section 1701.95 of the Ohio General Corporation Law provides
that a shareholder who knowingly receives any dividend, distribution, or payment
made contrary to law or the articles of a corporation shall be liable to the
Corporation for the amount received by him that is in excess of the amount that
could have been paid or distributed without violation of law or the articles.
DIVIDENDS
When, as, and if dividends, payable in cash, stock, or other property, are
declared by the Board of Directors of the Corporation out of funds legally
available therefor, the holders of Common Shares are entitled to share equally,
share for share, in such dividends. The payment of dividends on the Common
Shares is subject to the prior payment of dividends on the Preferred Stock.
VOTING
Except as described under "Outstanding Preferred Stock" above, holders of
Common Shares have exclusive voting rights of the Corporation and are entitled
to one vote for each share on all matters voted upon by the shareholders.
Holders of Common Shares do not have the right to cumulate their voting power.
LIQUIDATION
In the event of any liquidation, dissolution, or winding up of the
Corporation, whether voluntary or involuntary, the holders of the Common Shares
are entitled to receive, on a share for share basis, any assets or funds of the
Corporation which are distributable to its holders of Common Shares upon such
events, subject to the prior rights of creditors of the Corporation and holders
of the Corporation's outstanding Preferred Stock.
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SHAREHOLDER RIGHTS PLAN
In August 1989, the Corporation's Board of Directors declared a dividend
consisting of Rights to Purchase Common Shares ("Rights"). One of the Rights was
distributed with respect to each Common Share outstanding on September 12, 1989.
Rights have been and will continue to be issued in respect to all Common Shares
that are issued after September 12, 1989 but before the earlier of the
expiration or redemption of the Rights or the occurrence of a Triggering Event
(as defined below), or upon the exercise of any employee stock option granted
prior to a Triggering Event. The description and terms of the Rights are set
forth in the Rights Agreement, dated as of August 25, 1989, between the
Corporation and First Chicago Trust Company of New York, as Rights Agent, as
amended by the First Amendment to Rights Agreement, dated as of February 21,
1991, between the Corporation and the First Chicago Trust Company of New York,
as Rights Agent, a Second Amendment to Rights Agreement, dated as of September
12, 1991, between the Corporation and First Chicago Trust Company of New York,
as Rights Agent, a letter of resignation of First Chicago Trust Company of New
York, dated June 26, 1992, a letter of the Corporation, dated June 26, 1992, to
Ameritrust Texas National Association (now KeyBank National Association), and a
Third Amendment to Rights Agreement, dated as of October 1, 1993, between the
Corporation and Society National Bank (now KeyBank National Association), as
Rights Agent (such documents being hereinafter collectively referred to as
"Rights Agreement" which is filed as an exhibit to the Registration Statement).
The Rights are designed to protect the interests of the Corporation and its
shareholders against coercive takeover tactics. The purpose of the Rights
Agreement is to encourage potential acquirors to negotiate with the
Corporation's Board of Directors prior to attempting a takeover and to give the
Board leverage in negotiating on behalf of all shareholders the terms of any
proposed takeover. The Rights Agreement may, but is not intended to, deter
takeover proposals.
Each of the Rights initially represents the right to purchase one Common
Share for $65 (the "Purchase Price"). The Rights will become exercisable 20
calendar days after the earlier of (1) the commencement of a tender offer or
exchange offer that would result in a person or group becoming an Acquiring
Person (as defined below) or (2) a public announcement that a person or group
has become the beneficial owner of 15% or more of the outstanding Common Shares
(such person or group being an "Acquiring Person").
Until the Rights become exercisable, they will trade with the Common
Shares, and any transfer of Common Shares will also constitute a transfer of the
associated Rights. When the Rights become exercisable, they will begin to trade
separate and apart from the Common Shares. At that time, separate certificates
representing the Rights will be mailed to holders.
Twenty days after certain events occur ("Flip-in Events"), each of the
Rights will become the right to purchase one Common Share for the then par value
per share (now $1.00 per share), and the Rights beneficially owned by an
Acquiring Person will become void. The Flip-in Events are (1) the beneficial
ownership by a person or group of 15% or more of the outstanding Common Shares,
unless the Common Shares are acquired in a tender or exchange offer for all of
the Common Shares at a price and on other terms approved in advance by the
Corporation's Board of Directors, (2) certain self-dealing transactions between
the Corporation and an Acquiring Person and (3) a reclassification or
recapitalization of the Corporation that has the effect of increasing by more
than 1% the percentage of the Common Shares owned by an Acquiring Person.
If, after a person or group becomes an Acquiring Person, the Corporation is
acquired in a merger or other business combination or 50% or more of its assets
or earning power is sold, each of the Rights will "flip-over" and become the
right to purchase common shares of the acquiror (a "Flip-over Event"). The
holder (other than the Acquiring Person) of each Right would, upon the
occurrence of a Flip-over Event, be entitled to purchase for the then par value
of a Common Share (now $1.00) the number of common shares of the acquiror having
a market price equal to the market price of a Common Share.
The Purchase Price and/or the number of Common Shares (or common shares of
an acquiror) to be purchased upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution in the event the Corporation:
(1) declares a dividend on the Common Shares payable in Common Shares, (2)
subdivides or combines the outstanding Common Shares, (3) issues any shares
other than Common Shares in a reclassification of the Common Shares or (4) makes
a distribution to all holders of Common
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Shares, of debt securities, subscription rights, warrants or other assets
(except regular cash dividends). With certain exceptions, no adjustment will be
required until a cumulative adjustment of at least 1% is required. The
Corporation is not required to issue fractional shares and, instead, may make a
cash payment based on the market price of the Common Shares.
The Corporation's Board of Directors may redeem the Rights for 1/2(c) each
(the "Redemption Price") at any time before a "Triggering Event" (which is
defined as the occurrence of a Flip-over Event or the 20th day after a Flip-in
Event). However, the Rights may not be redeemed while there exists an Acquiring
Person unless (1) Continuing Directors, as defined below, constitute a majority
of the Board of Directors and (2) a majority of the Continuing Directors
approves the redemption. "Continuing Directors" are defined as directors who
were in office prior to a person or group becoming an Acquiring Person or whose
election to office was recommended by a majority of the Continuing Directors and
who are not affiliated with the Acquiring Person. The Rights will expire on
September 12, 1999, unless they are redeemed before that date.
Until the Rights are exercised, the holders of the Rights, as such, will
have no rights as shareholders of the Corporation, including the right to vote
or receive dividends. Upon exercise of the Rights, the holder of the Common
Share received upon the exercise thereof will be entitled to all the rights of
any other holder of Common Shares.
The provisions of the Rights Agreement may be amended by the Corporation's
Board of Directors to cure any ambiguity or correct any defect or inconsistency
or, prior to a Triggering Event, to make other changes that the Board of
Directors deems to be desirable and not adverse to the interests of the
Corporation and its shareholders.
DESCRIPTION OF CAPITAL SECURITIES
The following description of Capital Securities is included in this
Prospectus because a Prospectus Supplement may provide that Capital Securities
will be issuable upon conversion at the option of the Corporation of a series of
Subordinated Debt Securities or Preferred Stock. Whenever Capital Securities are
issued upon conversion of Subordinated Debt Securities, the Corporation will be
obligated to deliver Capital Securities with a Market Value (as defined below)
equal to the principal amount of such Subordinated Debt Securities. In addition,
the Corporation will unconditionally undertake to sell the Capital Securities in
a sale (the "Secondary Offering") on behalf of any holders who elect to receive
cash for the Capital Securities in which event the Corporation will bear all
expenses of the Secondary Offering, including underwriting discounts and
commissions. There can be no assurance, however, that there will be a market for
the Capital Securities when issued or at any time thereafter. If the Corporation
fails to deliver any Capital Securities when required to be delivered, the
Trustee may institute judicial proceedings for (i) specific performance, (ii)
money damages equal to the principal amount of the Subordinated Debt Securities
for which Capital Securities were to be converted or (iii) any other proper
remedy. If the Corporation fails to effect the Secondary Offering, it will
deliver to the holders Capital Securities and not cash, upon exchange of the
Subordinated Debt Securities. In such event, the Corporation will have no
specifically enforceable obligation to effect the Secondary Offering, but will
not be relieved of any liability for money damages it would have for breach of
its obligation to effect a Secondary Offering of sufficient amounts of Capital
Securities. The "Market Value" of any Capital Securities means their sale price
in the Secondary Offering. If the Corporation does not effect the Secondary
Offering, the Market Value of such Capital Securities shall be their fair value
when exchanged as determined by three independent nationally recognized
investment banking firms selected by the Corporation.
Whenever Preferred Stock is convertible at the option of the Corporation
into Capital Securities, the Corporation will be obligated to deliver Capital
Securities in an amount either based upon a conversion price or with a required
conversion value. The conversion value will be determined by then market prices,
by an auction or bidding procedure or by such other method as set forth in the
Applicable Prospectus Supplement.
The staff of the Commission has advised that Rules 13e-4 and 14e-1 of the
Commission's rules and regulations relating to tender offers by issuers, as
currently in effect and interpreted, would be applicable to the
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conversion of Capital Securities for Subordinated Debt Securities of any series
and the Secondary Offering. If, at the time of the conversion of Capital
Securities for Subordinated Debt Securities of any series and the Secondary
Offering, Rule 13e-4 or Rule 14e-1 (or any successor rule or rules) applies to
such transactions, the Corporation will comply with such rule (or any successor
rule or rules) and will afford holders of such Subordinated Securities all
rights and will make all filings required by such rule (or successor rule or
rules). Rule 13e-4 and Rule 14e-1 may also be deemed to apply to Preferred Stock
that is convertible at the option of the Corporation.
The Capital Securities may consist of Common Shares or Preferred Stock. All
Capital Securities which will be issuable upon conversion of Subordinated Debt
Securities or Preferred Stock will, upon issuance, be duly authorized, validly
issued and, if applicable, fully paid and non-assessable.
Any shares of Preferred Stock to be so issued will have such designations,
preferences, dividend, and other rights, qualifications, limitations, and
restrictions as may be determined by the Corporation and approved by the Board
of Directors.
DESCRIPTION OF SECURITIES WARRANTS
The Corporation may issue, separately or together with any Debt Securities,
Preferred Stock, Common Shares, or Depositary Shares, Securities Warrants for
the purchase of other Debt Securities, Preferred Stock, Common Shares, or
Depositary Shares (collectively, the "Underlying Securities"). The Securities
Warrants will be issued under a warrant agreement (a "Securities Warrant
Agreement") to be entered into between the Corporation and a bank or trust
company, as warrant agent (the "Securities Warrant Agent"), all as set forth in
the Applicable Prospectus Supplement relating to the particular issue of
Securities Warrants. The form of Securities Warrant Agreement, including the
form of certificates representing the Securities Warrants ("Securities Warrant
Certificates"), reflecting the alternative provisions to be included in the
Securities Warrant Agreements that will be entered into with respect to
particular offerings of Securities Warrants, is filed as an exhibit to the
Registration Statement. The following summaries of certain provisions of the
Securities Warrant Agreement and the Securities Warrant Certificates, which are
filed as exhibits to the Registration Statement, do not purport to be complete
and are subject to, and are qualified in their entirety by reference to, all of
the provisions of the Securities Warrant Agreement and the Securities Warrant
Certificates, respectively, including the definitions therein of certain terms.
Wherever defined terms of the Securities Warrant Agreement are referred to, it
is intended that such defined terms shall be incorporated herein by reference.
GENERAL
The Applicable Prospectus Supplement relating to the particular issue of
Securities Warrants offered thereby will describe the terms of the offered
Securities Warrants, the Securities Warrant Agreement relating to the offered
Securities Warrants, and the Securities Warrant Certificates representing the
offered Securities Warrants, including the following where applicable: (1) if
the Securities Warrants are offered for separate consideration, the offering
price and the currency for which Securities Warrants may be purchased; (2) the
title, aggregate principal amount, currency, and terms of the series of Debt
Securities purchasable upon exercise of the Debt Warrants and the price at which
such Debt Securities may be purchased upon such exercise; (3) the title, number
of shares, stated value, and terms (including, without limitation, liquidation,
dividend, conversion, redemption, and voting rights) of the series of Preferred
Stock purchasable upon exercise of Preferred Stock Warrants and the price at
which such number of shares of Preferred Stock of such series may be purchased
upon such exercise; (4) the number of Common Shares purchasable upon the
exercise of Common Share Warrants and the price at which such number of Common
Shares may be purchased upon such exercise; (5) the number of Depositary Shares
purchasable upon the exercise of Depositary Share Warrants, the terms of the
Preferred Stock which the Depositary Shares represent and the price at which
such number of Depositary Shares may be purchased upon such exercise; (6) the
date, if any, on and after which the offered Securities Warrants and the related
Debt Securities, Preferred Stock, Common Shares and/or Depositary Shares will be
separately transferable; (7) the time or times at which, or period or
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periods during which, the offered Securities Warrants may be exercised and the
final date on which the offered Securities Warrants may be exercised (the
"Expiration Date"); (8) a discussion of the specific United States Federal
income tax, accounting, and other considerations applicable to the Securities
Warrants; (9) the location where the offered Securities Warrants represented by
the Securities Warrant Certificates may be transferred and registered; and (10)
any other terms of the offered Securities Warrants.
Securities Warrant Certificates will be exchangeable on the terms specified
in the Applicable Prospectus Supplement for new Securities Warrant Certificates
of different denominations evidencing the same aggregate number of Warrants of
the same title, and may be transferred in whole or in part on the terms
specified in the Applicable Prospectus Supplement.
Prospective purchasers of Securities Warrants should be aware that special
U.S. federal income tax, accounting and other considerations may be applicable
to instruments such as Securities Warrants. The Applicable Prospectus Supplement
relating to any issue of Securities Warrants will describe such considerations.
EXERCISE OF WARRANTS
Each Securities Warrant will entitle the holder to purchase the principal
amount of or number of Underlying Securities provided for therein, at such
exercise price as shall in each case be set forth in, or be determinable from,
the Applicable Prospectus Supplement relating to the Securities Warrants, by
payment of such exercise price (the "Warrant Price") in full in the currency and
in the manner specified in the Applicable Prospectus Supplement. Securities
Warrants may be exercised at any time at or before 5:00 P.M., New York City time
on the Expiration Date (or such later date to which such Expiration Date may be
extended by the Corporation), and unexercised Securities Warrants will become
void at such time. Securities Warrants may be exercised at the corporate trust
office of the Securities Warrant Agent or any other office indicated in the
Applicable Prospectus Supplement relating to the Securities Warrants.
Upon receipt at the corporate trust office of the Securities Warrant Agent
or any other office indicated in the Applicable Prospectus Supplement of (i)
payment of the Warrant Price and (ii) the form of election to purchase set forth
on the reverse side of the Securities Warrant Certificate properly completed and
duly executed, the Corporation will, as soon as practicable, issue the
Underlying Securities purchasable upon such exercise. If fewer than all of the
Securities Warrants represented by such Securities Warrant Certificate are
exercised, a new Securities Warrant Certificate will be issued for the remaining
number of unexercised Securities Warrants.
MODIFICATIONS
The Warrant Agreement may be supplemented or amended by the Corporation and
the Warrant Agent from time to time, without the approval of any Holder (as
defined in the Warrant Agreement), in order to cure any ambiguity, to correct or
supplement any defective or inconsistent provision contained therein, or to make
any other provision in regard to matters or questions arising thereunder that
the Corporation and the Warrant Agent may deem necessary or desirable and which
will not adversely affect the interests of the Holders.
The Corporation and the Warrant Agent may also modify or amend the Warrant
Agreement and the Securities Warrant Certificates with the consent of the
Holders of not fewer than a majority in number of the then outstanding
unexercised Warrants affected by such modification or amendment, for any
purpose, provided that no such modification or amendment that shortens the
period of time during which the Warrants may be exercised, or otherwise
materially and adversely affects the exercise rights of the Holders or reduces
the percentage of Holders of outstanding Warrants the consent of which is
required for modification or amendment of the Warrant Agreement or the Warrants
may be made without the consent of each Holder affected thereby.
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COMMON SHARE WARRANT ADJUSTMENTS
The terms and conditions on which the Warrant Price of and/or the number of
Common Shares covered by a Warrant to purchase Common Shares (a "Common Share
Warrant") are subject to adjustment will be set forth in the Warrant Agreement
and the Applicable Prospectus Supplement. Such terms will include provisions for
adjusting the Warrant Price and/or the number of Common Shares covered by such
Common Share Warrant; the events requiring such adjustment; the events upon
which the Corporation may, in lieu of making such adjustment, make proper
provision so that the holder of such Common Share Warrant, upon exercise
thereof, would be treated as if such holder had exercised such Common Share
Warrant prior to the occurrence of such events; and provisions affecting
exercise in the event of certain events affecting the Common Shares.
MERGER, CONSOLIDATION, SALE, OR OTHER DISPOSITIONS
If at any time there shall be a merger, consolidation, sale, conveyance,
transfer, lease, or other disposition of substantially all of the assets of the
Corporation, then the successor or assuming corporation shall succeed to and be
substituted for the Corporation in, and the Corporation will be relieved of any
further obligation under, the Warrant Agreement or the Warrants.
ENFORCEABILITY OF RIGHTS OF HOLDERS
The Warrant Agent will act solely as an agent of the Corporation in acting
under the Warrant Agreement and in connection with any Warrant Certificate. The
Warrant Agent shall have no duty or responsibility in case of any default by the
Corporation in the performance of its covenants or agreements contained in the
Warrant Agreement or in any Warrant Certificate. Each Holder may, without the
consent of the Warrant Agent, enforce by appropriate legal action, on its own
behalf, the Holder's right to exercise its Warrants in the manner provided in
the Warrant Agreement and its Warrant Certificate.
NO RIGHTS AS HOLDERS OF UNDERLYING SECURITIES
Prior to the exercise of any Securities Warrants to purchase Underlying
Securities, holders of such Securities Warrants will not have any of the rights
of holders of the Underlying Securities purchasable upon such exercise,
including, without limitation, the right to receive the payment of principal of,
or premium on, if any, or interest, if any, dividends or distributions of any
kind, if any, on Underlying Securities, the right to enforce any of the
covenants in the Indentures, if applicable, or the right to exercise any voting
rights.
PLAN OF DISTRIBUTION
The Corporation may sell Securities to one or more underwriters for public
or private offering and sale by them or may sell Securities to investors
directly or through agents (which agents may be affiliates of the Corporation)
that solicit or receive offers on behalf of the Corporation or through dealers
or through a combination of any such methods of sale.
The Applicable Prospectus Supplement will set forth the terms of the
offering of the particular series of Securities to which such Applicable
Prospectus Supplement relates, including (i) the name or names of any
underwriters or agents with whom the Corporation has entered into arrangements
with respect to the sale of such series of Securities; (ii) the initial public
offering or purchase price of such series of Securities; (iii) any underwriting
discounts, commissions, and other items constituting underwriters' compensation
from the Corporation and any other discounts, concessions, or commissions
allowed or reallowed or paid by any underwriters to other dealers; (iv) any
commissions paid to any agents; (v) the net proceeds to the Corporation; and
(vi) the securities exchanges, if any, on which such series of Securities will
be listed.
Unless otherwise set forth in the Applicable Prospectus Supplement relating
to a particular series of Securities, the obligations of the underwriters to
purchase such series of Securities will be subject to certain conditions
precedent and each of the underwriters with respect to such series of Securities
will be obligated to purchase all of the Securities of such series allocated to
it if any such Securities are purchased. Any initial
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public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
The Securities may be offered and sold by the Corporation directly or
through agents designated by the Corporation from time to time. Unless otherwise
indicated in the Applicable Prospectus Supplement, each such agent will be
acting on a reasonable efforts basis for the period of its appointment. Any
agent participating in the distribution of Securities may be deemed to be an
"underwriter," as that term is defined in the Securities Act, of the Securities
so offered and sold. The Securities also may be sold to dealers at the
applicable price to the public set forth in the Applicable Prospectus Supplement
relating to a particular series of Securities who later resell to investors.
Such dealers may be deemed to be "underwriters" within the meaning of the
Securities Act.
Underwriters, dealers, and agents may be entitled, under agreements entered
into with the Corporation, to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act.
The Corporation may also issue contracts under which the counterparty may
be required to purchase Debt Securities, Preferred Stock, or Depositary Shares.
Such contracts would be issued with Debt Securities, Preferred Stock, or
Depositary Shares and/or Securities Warrants in amounts, at prices and on terms
to be set forth in a Prospectus Supplement.
If so indicated in the Applicable Prospectus Supplement, the Corporation
will authorize underwriters, dealers, or agents to solicit offers by certain
institutions to purchase Securities of a series from the Corporation at the
public offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts (each, a "Contract") providing for payment and delivery at a
future date. Each Contract will be subject only to those conditions set forth in
the Applicable Prospectus Supplement and the Applicable Prospectus Supplement
will set forth the commission payable for solicitation of such offers.
Any of the underwriters, dealers, and agents of the Corporation and their
associates may be customers of, engage in transactions with, and perform
services for the Corporation in the ordinary course of business.
The place and time of delivery of the Securities will be set forth in the
Applicable Prospectus Supplement.
LEGAL OPINIONS
The validity of the Securities offered hereby will be passed upon for the
Corporation, as shall be indicated in the Applicable Prospectus Supplement, by
either the General Counsel or a Senior Managing Counsel to the Corporation or by
Thompson Hine & Flory P.L.L., 3900 Key Tower, 127 Public Square, Cleveland, Ohio
44114-1216, and for the Underwriters by Shearman & Sterling, 599 Lexington
Avenue, New York, New York 10022. Shearman & Sterling will rely as to all
matters of Ohio law on the opinion rendered on behalf of the Corporation. The
General Counsel or a Senior Managing Counsel to the Corporation or Thompson Hine
& Flory P.L.L., as the case may be, will rely as to all matters of New York law
on the opinion of Shearman & Sterling. The aggregate number of shares owned by
attorneys at Thompson Hine & Flory P.L.L. or the General Counsel or Senior
Managing Counsel of the Corporation rendering the opinion referred to above on
behalf of the Corporation will be set forth in the Applicable Prospectus
Supplement.
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EXPERTS
The consolidated financial statements of KeyCorp and subsidiaries
incorporated by reference in KeyCorp's Annual Report (Form 10-K) for the year
ended December 31, 1995, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon incorporated therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
With respect to the unaudited condensed consolidated interim financial
information for the three-month periods ended March 31, 1996 and March 31, 1995
and for the three and six-month periods ended June 30, 1996 and 1995
incorporated by reference in this Prospectus, Ernst & Young LLP have reported
that they have applied limited procedures in accordance with professional
standards for a review of such information. However, their separate reports,
included in KeyCorp's Quarterly Report on Form 10-Q for the quarters ended March
31, 1996 and June 30, 1996, and incorporated herein by reference, states that
they did not audit and they do not express an opinion on that interim financial
information. Accordingly, the degree of reliance on their report on such
information should be restricted considering the limited nature of the review
procedures applied. The independent auditors are not subject to the liability
provisions of Section 11 of the Securities Act for their report on the unaudited
interim financial information because that report is not a "report" or a "part"
of the Registration Statement prepared or certified by the auditors within the
meaning of Sections 7 and 11 of the Securities Act.
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION
OR MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT, THE
ACCOMPANYING PROSPECTUS OR ANY PRICING SUPPLEMENT IN CONNECTION WITH THE OFFER
CONTAINED HEREIN AND, IF GIVEN OR MADE, ANY SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY AGENT,
DEALER OR UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT, THE
ACCOMPANYING PROSPECTUS OR ANY PRICING SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR
THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN OR IN THE ACCOMPANYING PROSPECTUS OR ANY PRICING
SUPPLEMENT IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF OR THEREOF OR
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THEREOF. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE ACCOMPANYING
PROSPECTUS NOR ANY PRICING SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PROSPECTUS SUPPLEMENT
Selected Consolidated Financial
Data............................... S-2
Description of Notes................. S-4
Foreign Currency Risks............... S-20
United States Tax Considerations..... S-21
Plan of Distribution................. S-28
Validity of the Notes................ S-29
PROSPECTUS
Available Information................ 2
Incorporation of Certain Documents by
Reference.......................... 2
The Corporation...................... 4
Use of Proceeds...................... 5
Description of Debt Securities....... 6
Description of Preferred Stock....... 20
Description of Depositary Shares..... 23
Description of Common Shares......... 28
Description of Capital Securities.... 30
Description of Securities Warrants... 31
Plan of Distribution................. 33
Legal Opinions....................... 34
Experts.............................. 35
</TABLE>
KEYCORP
$750,000,000
SENIOR MEDIUM-TERM NOTES,
SERIES D
SUBORDINATED MEDIUM-TERM
NOTES, SERIES C
DUE NINE MONTHS
OR MORE FROM DATE
OF ISSUE
KEYCORP
LOGO
SALOMON BROTHERS INC
CHASE SECURITIES INC.
CITICORP SECURITIES, INC.
CS FIRST BOSTON
GOLDMAN, SACHS & CO.
J.P. MORGAN & CO.
PROSPECTUS SUPPLEMENT
DATED AUGUST , 1996
<PAGE> 71
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses in connection with the issuance and distribution of the
securities being registered other than underwriting compensation are as follows:
<TABLE>
<S> <C>
SEC Registration Fee.............................................. $413,796
Fees of Rating Agencies........................................... 200,000
Printing and Engraving Expenses................................... 50,000
Legal Fees and Expenses........................................... 75,000
Accounting Fees and Expenses...................................... 20,000
Fees of Indenture Trustees........................................ 8,000
Blue Sky Fees and Expenses........................................ 35,000
Miscellaneous..................................................... 50,000
--------
Total................................................... $851,796
========
</TABLE>
- ---------------
All the above amounts except the SEC registration fee are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Ohio law, Ohio corporations are authorized to indemnify directors,
officers, employees, and agents within prescribed limits and must indemnify them
under certain circumstances. Ohio law does not provide statutory authorization
for a corporation to indemnify directors, officers, employees, and agents for
settlements, fines, or judgments in the context of derivative suits. However, it
provides that directors (but not officers, employees, and agents) are entitled
to mandatory advancement of expenses, including attorneys' fees, incurred in
defending any action, including derivative actions, brought against the
director, provided the director agrees to cooperate with the corporation
concerning the matter and to repay the amount advanced if it is proved by clear
and convincing evidence that his act or failure to act was done with deliberate
intent to cause injury to the corporation or with reckless disregard for the
corporation's best interests.
Ohio law does not authorize payment of judgments to a director, officer,
employee, or agent after a finding of negligence or misconduct in a derivative
suit absent a court order. Indemnification is required, however, to the extent
such person succeeds on the merits. In all other cases, if a director, officer,
employee, or agent acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, indemnification
is discretionary except as otherwise provided by a corporation's articles, code
of regulations, or by contract except with respect to the advancement of
expenses of directors.
Under Ohio law, a director is not liable for monetary damages unless it is
proved by clear and convincing evidence that his action or failure to act was
undertaken with deliberate intent to cause injury to the corporation or with
reckless disregard for the best interests of the corporation. There is, however,
no comparable provision limiting the liability of officers, employees, or agents
of a corporation. The statutory right to indemnification is not exclusive in
Ohio, and Ohio corporations may, among other things, procure insurance for such
persons.
The KeyCorp Regulations provide that KeyCorp shall indemnify to the fullest
extent permitted by law any person made or threatened to be made a party to any
action, suit, or proceeding by reason of the fact that he is or was a director,
officer, or employee of KeyCorp or of any other bank, corporation, partnership,
trust, or other enterprise for which he was serving as a director, officer, or
employee at the request of KeyCorp.
Reference is made to the Form of Underwriting Agreement and the
Distribution Agreement for additional provisions for the indemnification of
directors, controlling persons, and certain officers of the Registrant by the
underwriters. The Forms of Underwriting Agreement and Distribution Agreement are
II-1
<PAGE> 72
exhibits to the Registration Statement.
Except as stated above, neither the Amended and Restated Articles of
Incorporation of KeyCorp nor any other contract or arrangement to which KeyCorp
is a party provides for such indemnification. Under the terms of KeyCorp's
directors' and officers' liability and company reimbursement insurance policy,
directors and officers of KeyCorp are insured against certain liabilities,
including liabilities arising under the Securities Act.
KeyCorp is a party to agreements with, respectively, Robert W. Gillespie,
Roger Noall and Victor J. Riley, Jr., and KeyCorp is party to Change of Control
Agreements with certain other executive officers (the provisions of which became
effective as a result of the merger of old KeyCorp with and into Society),
pursuant to which KeyCorp has agreed to indemnify the officer, to the full
extent permitted or authorized by Ohio law, if the officer is made or threatened
to be made a party to any action, suit, or proceeding by reason of the officer's
serving as an employee, officer, or director of KeyCorp and/or any of its
subsidiaries or any other company at the request of KeyCorp or any of its
subsidiaries, and KeyCorp has agreed to advance expenses incurred by the officer
in defending any such action, suit, or proceeding.
ITEM 16. EXHIBITS.
See Index to Exhibits.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if
the registration statement is on Form S-3 or Form S- 8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") that are incorporated by
reference in the registration statement.
(2) that, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) to remove from registration by means of post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
II-2
<PAGE> 73
The undersigned Registrant hereby further undertakes to file an application
for the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act ("Act") in accordance
with the rules and regulations prescribed by the Commission under Section
305(b)(2) of the Act.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the provisions described in Item 15 above, or otherwise,
the Registrant 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 the
Registrant of expenses incurred or paid by a director, officer, or controlling
person of the 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, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-3
<PAGE> 74
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL
OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS FORM S-3
REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO
DULY AUTHORIZED, IN THE CITY OF CLEVELAND, STATE OF OHIO, ON THIS 21ST DAY OF
AUGUST, 1996.
KEYCORP
By /s/THOMAS C. STEVENS
------------------------------
Thomas C. Stevens
Executive Vice President,
General Counsel and Secretary
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
THIS FORM S-3 REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN
THE CAPACITIES INDICATED.
Robert W. Gillespie, President, Chief Executive Officer and Director
(Principal Executive Officer); K. Brent Somers, Senior Executive Vice President
and Chief Financial Officer (Principal Financial Officer); Lee G. Irving,
Executive Vice President and Chief Accounting Officer (Principal Accounting
Officer); Cecil D. Andrus, Director; William G. Bares, Director; Albert C.
Bersticker, Director; Thomas A. Commes, Director; Kenneth M. Curtis, Director;
John C. Dimmer, Director; Stephen R. Hardis, Director; Henry S. Hemingway,
Director; Charles R. Hogan, Director; Douglas J. McGregor, Director; Steven A.
Minter, Director; M. Thomas Moore, Director; Victor J. Riley, Jr., Director;
Ronald B. Stafford, Director; Dennis W. Sullivan, Director; Peter G. Ten Eyck,
II, Director; and Nancy B. Veeder, Director.
KEYCORP
By /s/THOMAS C. STEVENS
------------------------------
Thomas C. Stevens
Attorney-in-Fact
August 21, 1996
II-4
<PAGE> 75
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 21, 1996
REGISTRATION NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
KEYCORP
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
---------------------------------
EXHIBITS
---------------------------------
<PAGE> 76
KEYCORP
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
FORM S-3
EXHIBIT NO. DESCRIPTION
- -----------
<S> <C>
(1)(a) Form of Underwriting Agreement.
(1)(b) Form of Distribution Agreement.
(4)(a) Amended and Restated Articles of Incorporation of KeyCorp. Incorporated herein by
reference to Exhibit 7 to Form 8-A/A filed on February 25, 1994.
(4)(b) Regulations of KeyCorp. Incorporated herein by reference to Exhibit 6 to Form
8-A/A filed on February 25, 1994.
(4)(c) Senior Indenture between KeyCorp and Bankers Trust Company, as Trustee.
Incorporated herein by reference to Exhibit (4)(c) to Registration Statement on
Form S-3, Commission No. 33-58405, filed with the SEC on April 3, 1995
("Registration Statement No. 33-58405").
(4)(d) Subordinated Indenture between KeyCorp and Bankers Trust Company, as Trustee.
Incorporated herein by reference to Exhibit (4)(d) to Registration Statement No.
33-58405.
(4)(e) Form of Senior Debt Securities. Incorporated herein by reference to Exhibit (4)(e)
to Registration Statement No. 33-58405.
(4)(f) Form of Subordinated Debt Securities. Incorporated herein by reference to Exhibit
(4)(f) to Registration Statement No. 33-58405.
(4)(g) Form of Warrant Agreement. Incorporated herein by reference to Exhibit (4)(g) to
Registration Statement No. 33-58405.
(4)(h) Form of Warrant Certificate. Incorporated herein by reference to Exhibit (4)(h) to
Registration Statement No. 33-58405.
(4)(i) Form of Deposit Agreement. Incorporated herein by reference to Exhibit (4)(i) to
Registration Statement No. 33-58405.
(4)(j) Form of Depositary Receipt. Incorporated herein by reference to Exhibit (4)(j) to
Registration Statement No. 33-58405.
(4)(k) Rights Agreement, dated as of August 25, 1989, between Society Corporation
(renamed KeyCorp on March 1, 1994) and First Chicago Trust Company of New York, as
Rights Agent, including as Exhibit A thereto the form of Rights Certificate.
Incorporated herein by reference to Exhibit 1 to Form 8-A filed on August 29,
1989.
(4)(l) First Amendment to Rights Agreement, dated February 21, 1991, between Society
Corporation (renamed KeyCorp on March 1, 1994) and First Chicago Trust Company of
New York, as Rights Agent. Incorporated herein by reference to Exhibit 1 to Form
8-A filed on February 28, 1991.
(4)(m) Second Amendment to Rights Agreement, dated September 12, 1991, between Society
Corporation (renamed KeyCorp on March 1, 1994) and First Chicago Trust Company of
New York, as Rights Agent. Incorporated herein by reference to Exhibit 4 to
Schedule 13D filed on September 23, 1991.
(4)(n) Third Amendment to Rights Agreement, dated October 1, 1993, between Society
Corporation (renamed KeyCorp on March 1, 1994) and Society National Bank (renamed
KeyBank National Association on June 17, 1996), as Rights Agent. Incorporated
herein by reference to Exhibit 4 to Schedule 13D filed on October 12, 1993.
(5) Opinion of Daniel R. Stolzer, Senior Managing Counsel to the Corporation as to the
legality of the securities to be registered.
(12) Computation of KeyCorp's Consolidated Ratios of Earnings to Fixed Charges and
Combined Fixed Charges and Preferred Stock Dividends.
(23)(a) Consent of Ernst & Young LLP.
(23)(b) Consent of Daniel R. Stolzer, Senior Managing Counsel to the Corporation (included
as part of Exhibit (5)).
(23)(c) Consent of Thompson Hine & Flory P.L.L.
(24)(a) Powers of Attorney.
(24)(b) Certified Resolutions of Board of Directors of KeyCorp.
(25) Form T-1 Statement of Eligibility and Qualifications under the Trust Indenture Act
of 1939 of Bankers Trust Company, as Trustee.
</TABLE>
<PAGE> 1
Exhibit (1)(a)
KeyCorp
(an Ohio corporation)
Senior Debt
Securities, Subordinated
Debt Securities, Preferred Stock,
Depositary Shares representing Preferred
Stock, Warrants to Purchase Debt Securities,
Preferred Stock, Depositary Shares or Common Stock
UNDERWRITING AGREEMENT STANDARD PROVISIONS
------------------------------------------
From time to time, KeyCorp, an Ohio corporation (the
"Company"), may enter into one or more Terms Agreements in the form of Exhibit A
hereto (each a "Terms Agreement") that provide for the sale of designated
securities to the several underwriters named therein. The standard provisions
set forth herein may be incorporated by reference in any such Terms Agreement.
The Terms Agreement including the provisions incorporated therein by reference,
is herein referred to as "this Agreement". Unless otherwise defined herein,
terms defined in the Terms Agreement are used herein as therein defined.
1. DESCRIPTION OF SECURITIES. The Company proposes to issue
and sell from time to time, either together or separately, certain of its (i)
senior debt securities (the "Senior Debt Securities") and/or (ii) subordinated
debt securities (the "Subordinated Debt Securities", and together with the
Senior Debt Securities, the "Debt Securities"), and/or (iii) preferred stock
(the "Preferred Stock"), and/or (iv) depositary shares which represent
fractional interests in the Preferred Stock (the "Depositary Shares") and/or (v)
warrants (the "Warrants") to purchase Debt Securities, Preferred Stock,
Depositary Shares or the Company's Common Shares, with a par value of $1 each
(the "Common Stock"), in one or more offerings on terms determined at the time
of sale and set forth in a Terms Agreement. The Subordinated Debt Securities may
be convertible into Capital Securities (as defined below) of the Company and the
Preferred Stock may be convertible into shares of Common Stock, Debt Securities
or any class or series of Capital Securities in each case as set forth in the
applicable Terms Agreement relating thereto. As used herein, "Capital
Securities" means any securities issued by the Company which consist of (i)
Common Stock, (ii) perpetual
<PAGE> 2
2
preferred stock or (iii) other capital securities of the Company permitted by
the Company's primary federal banking regulator. Capital Securities may have
such terms, rights and preferences as may be determined by the Company.
The Senior Debt Securities are to be issued under an Indenture
dated as of June 10, 1994, as amended or supplemented (the "Senior Indenture"),
between the Company and Bankers Trust Company, as trustee (the "Senior
Trustee"). The Subordinated Debt Securities are to be issued under an Indenture
dated as of June 10, 1994, as amended or supplemented (the "Subordinated
Indenture"), between the Company and Bankers Trust Company, as trustee (the
"Subordinated Trustee", and together with the Senior Trustee, the "Trustees").
The Senior Indenture and the Subordinated Indenture are collectively referred to
herein as the "Indentures". The Senior Debt Securities and the Subordinated Debt
Securities may have varying titles, maturities, rates and times of payment of
interest, if any, selling prices, redemption terms, if any, conversion terms, if
any, and other specific terms as set forth in the applicable Terms Agreement
relating thereto.
The Warrants are to be issued under warrant agreements (each a
"Warrant Agreement"), between the Company and a bank or trust company, as
warrant agent (the "Warrant Agent"). The Warrants may have varying titles,
expiration dates, selling prices, redemption terms, if any, adjustment terms, if
any, and other specific terms as set forth in the applicable Terms Agreement
relating thereto.
Each issue of Preferred Stock may vary as to the specific
number of shares, title, stated value and liquidation preference, issuance
price, dividend rate or rates (or method of calculation), dividend payment
dates, redemption or sinking fund requirements, conversion provisions and any
other variable terms as set forth in the applicable Terms Agreement relating to
such Preferred Stock. If the shares of Preferred Stock are to be offered in the
form of Depositary Shares, the Preferred Stock will, when issued, be deposited
by the Company against delivery of depositary receipts (the "Depositary
Receipts") to be issued under a deposit agreement (the "Deposit Agreement"), to
be entered into among the Company, a depositary institution (the "Depositary")
and the holders from time to time of the Depositary Receipts issued thereunder.
The Depositary Receipts will evidence the Depositary Shares and each Depositary
Share will represent a fraction of a share of Preferred Stock. The Preferred
Stock, together, if applicable, with the Depositary Shares is hereinafter
referred to as the "Shares".
The Debt Securities, Warrants and Shares to be issued and sold
as specified in the applicable Terms Agreement, shall collectively be referred
to herein as the "Offered Securities". The Company may also grant to the
Underwriters an option to purchase additional Offered Securities to cover
over-allotments, if any, as specified in the applicable Terms Agreement (the
"Option Securities"). The Offered Securities and Option Securities, if any,
shall collectively be referred to as the "Securities". As used herein, unless
the context
<PAGE> 3
3
otherwise requires, the term "Underwriters" shall mean the firm or firms
specified as Underwriter or Underwriters in the applicable Terms Agreement
relating to the Securities and the term "you" shall mean the Underwriter or
Underwriters, if no underwriting syndicate is purchasing the Securities, or the
representative or representatives of the Underwriters specified in the
applicable Terms Agreement (the "Representatives"), if an underwriting syndicate
is purchasing the Securities, as specified in the applicable Terms Agreement.
The Debt Securities, Preferred Stock, Depositary Shares and
Warrants may be sold either separately or as units (the "Units").
Whenever the Company determines to make an offering of
Securities, the Company will enter into a Terms Agreement providing for the sale
of the applicable Securities to, and the purchase and offering thereof by, the
Underwriters. The Terms Agreement relating to the Securities shall specify the
type of Securities to be issued, the names of the Underwriters participating in
such offering (subject to substitution as provided in Section 9 hereof), the
number of Offered Securities which each such Underwriter severally agrees to
purchase, the price at which the Securities are to be purchased by the
Underwriters from the Company, the initial public offering price of the
Securities, the time and place of delivery and payment and other specific terms.
The Terms Agreement may take the form of an exchange of any standard form of
written telecommunication between you and the Company. Each offering of
Securities will be governed by this Agreement and shall inure to the benefit of
and be binding upon the Company and each Underwriter participating in the
offering of such Securities.
The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(File No. 33- ), including a prospectus, relating to the Securities and the
offering thereof from time to time in accordance with Rule 415 under the
Securities Act of 1933, as amended (the "Securities Act" and the rules and
regulations thereto being referred to as the "Securities Act Regulations"),
which registration statement also constitutes post-effective amendment no. 1 to
registration statement no. 33-58405 relating to the Company's Debt Securities,
Common Shares, Preferred Stock, Depositary Shares, Warrants and Capital
Securities. Such registration statement and such post-effective amendment, as
amended, have been declared effective by the Commission. As provided in Section
4(a), a prospectus supplement reflecting the terms of the Securities, the terms
of the offering thereof and the other matters set forth therein has been
prepared and will be filed pursuant to Rule 424 under the Securities Act. Such
prospectus supplement, in the form first filed after the date of the applicable
Terms Agreement pursuant to Rule 424, is herein referred to as the "Prospectus
Supplement". Such registration statement and such post-effective amendments, as
amended at the date of the applicable Terms Agreement, including the exhibits
thereto and the documents incorporated by reference therein, are herein called
the "Registration Statement", and the basic prospectus included therein relating
to all offerings of securities under the
<PAGE> 4
4
Registration Statement, as supplemented by the Prospectus Supplement, is herein
called the "Prospectus", except that, if such basic prospectus is amended or
supplemented on or prior to the date on which the Prospectus Supplement is first
filed pursuant to Rule 424, the term "Prospectus" shall refer to the basic
prospectus as so amended or supplemented and as supplemented by the Prospectus
Supplement, in either case including the documents filed by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that are incorporated by reference therein. Any preliminary
prospectus supplement included in such Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the Securities Act Regulations is herein
called a "Preliminary Prospectus".
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, each Representative and each
Underwriter that:
(a) The Registration Statement has been declared effective by
the Commission under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
the Company, threatened by the Commission.
(b) The Company meets the requirements for use of Form S-3
under the Securities Act and the Registration Statement and the
Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) comply, or will
comply, as the case may be, in all material respects with the
Securities Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the rules and regulations of the Commission
thereunder; each part of the Registration Statement and any amendment
or supplement thereto, as of the date such part became or becomes
effective, did not or will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading;
each Prospectus, and any amendment or supplement thereto, as of the
date thereof, did not or will not include an untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading; provided, however, that the Company makes no
representations or warranties as to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility (Form
T-1) under the Trust Indenture Act of the Trustee or (ii) the
information contained in or omitted from the Registration Statement or
the Prospectus or any amendment thereof or supplement thereto in
reliance upon and in conformity with information furnished in writing
to the Company by or on behalf of any Underwriter through the
Representatives specifically for use in connection with the preparation
of the Registration Statement and such Prospectus.
<PAGE> 5
5
(c) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, comply, or will comply, as the case may be, in all
material respects to the requirements of the Exchange Act and, if
applicable, the Securities Act and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus, or any amendment or
supplement thereto, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material
respects to the requirements of the Exchange Act and, as applicable,
the Securities Act and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(d) (i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Ohio, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended, and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in
good standing, considering all such cases in the aggregate, does not
involve a material risk to the business, properties, financial position
or results of operations of the Company and its subsidiaries; (ii) each
of its national bank subsidiaries is a duly organized and validly
existing national banking association under the laws of the United
States, continues to hold a valid certificate to do business as such
and has full power and authority to conduct its business as such; each
of its state-chartered bank subsidiaries is a duly organized and
validly existing state-chartered bank under the laws of the
jurisdiction of its organization, continues to hold a valid certificate
to do business as such and has full power and authority to conduct its
business as such; each of its other significant subsidiaries, as
defined in Regulation S-X (the "Significant Subsidiaries"), is duly
organized and validly existing under the laws of the jurisdiction of
its organization with corporate power and authority under such laws to
conduct its business; and (iii) all of the outstanding shares of
capital stock of each such subsidiary have been duly authorized and
validly issued, are fully paid and non-assessable (except, with respect
to any subsidiary that is a national bank, as provided by Section 55 of
Title 12 of the United States Code; and, with respect to any subsidiary
that is a bank incorporated under state law, except as provided by the
laws of any such states and (except as otherwise stated in the
Registration Statement) are owned beneficially by the Company subject
to no security interest, pledge, lien, charge or other encumbrance or
adverse claim.
<PAGE> 6
6
(e) The execution and delivery of this Agreement, the
Indentures, the Warrant Agreement, and the Deposit Agreement, if any,
and the consummation of the transactions contemplated herein and
therein, have been duly authorized by all necessary corporate action
and when executed by the Company and the other parties thereto will not
result in any breach of any of the terms, conditions or provisions of,
or constitute a default under, or result in the creation or imposition
of any security interest, lien, charge or encumbrance upon any property
or assets of the Company or its subsidiaries, pursuant to any
indenture, loan agreement, contract or other material agreement or
instrument to which the Company or its subsidiaries is a party or by
which the Company may be bound or to which any of the property or
assets of the Company or its subsidiaries is subject, nor will such
action result in any violation of the provisions of the Amended and
Restated Articles of Incorporation or the Regulations of the Company or
its subsidiaries or any applicable statute, rule or regulation or, to
the best of its knowledge, any order of any court or governmental
agency or body having jurisdiction over the Company, its subsidiaries
or any of their respective properties.
(f) If the Securities include Debt Securities, such Debt
Securities shall, on the date of the Terms Agreement relating to such
Securities, be duly authorized and, when such Debt Securities are duly
executed, authenticated and delivered in the manner provided for in the
applicable Indenture and issued and paid for in accordance with this
Agreement and the applicable Terms Agreement, such Debt Securities will
constitute legal, valid and binding obligations of the Company entitled
to the benefits of the applicable Indenture and enforceable against the
Company in accordance with their terms subject, as to enforcement, to
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
similar laws relating to or affecting creditors' rights generally and
to general equity principles; and, if the Securities include
Subordinated Debt Securities that are convertible into Capital
Securities, then such Subordinated Debt Securities shall be convertible
into Capital Securities in accordance with their terms and the terms of
the Subordinated Indenture.
(g) If the Securities include Preferred Stock, such shares of
Preferred Stock shall, on the date of the Terms Agreement relating to
such Securities, be duly authorized and, when such shares of Preferred
Stock are duly executed and delivered and issued and paid for in
accordance with this Agreement and the applicable Terms Agreement, such
shares of Preferred Stock will have been validly issued, fully paid and
non-assessable; no holder thereof will be subject to personal liability
by reason of being such a holder; such shares of Preferred Stock will
not be subject to the preemptive rights of any stockholder of the
Company; and all corporate action required to be taken for the
authorization, issue and sale of such shares of Preferred Stock has
been, or at the Closing Date will be, validly and sufficiently taken;
and, if
<PAGE> 7
7
the Securities include shares of Preferred Stock that are to be
represented by Depositary Shares, then, upon deposit by the Company of
such shares of Preferred Stock with the Depositary pursuant to the
Deposit Agreement and the execution by the Depositary of the Depositary
Receipts evidencing the Depositary Shares, such Depositary Shares shall
represent legal and valid interests in such shares of Preferred Stock;
and, if the Securities include shares of Preferred Stock that are
convertible into Capital Securities, Debt Securities or other preferred
stock, then such shares of Preferred Stock shall be convertible into
Capital Securities, Debt Securities or other preferred stock in
accordance with their terms and the terms of the Certificate of
Amendment establishing a series of a class of stock relating to such
shares of Preferred Stock (the "Certificate of Amendment").
(h) If the Securities include Warrants, such Warrants shall,
on the date of the Terms Agreement relating to such Securities, be duly
authorized and, when such Warrants are duly executed, countersigned and
delivered in the manner provided for in the Warrant Agreement and
issued and paid for in accordance with this Agreement and the
applicable Terms Agreement, such Warrants will constitute legal, valid
and binding obligations of the Company entitled to the benefits of the
Warrant Agreement and enforceable against the Company in accordance
with their terms subject, as to enforcement, to bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws relating to or
affecting creditors' rights generally and to general equity principles;
and the Warrants shall be exercisable for Debt Securities or Preferred
Stock in accordance with their terms and the terms of the Warrant
Agreement.
(i) If the Securities include Preferred Stock convertible into
Debt Securities or Debt Securities, the Indentures have been duly
authorized by the Company and qualified under the Trust Indenture Act,
will be substantially in the forms filed as exhibits to the
Registration Statement and, when duly executed and delivered by the
Company and the Trustees, will constitute legal, valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms subject, as to enforcement, to bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
relating to or affecting creditors' rights generally and to general
equity principles; and the summary descriptions of the Indentures set
forth in the Prospectus conform in all material respects to the
provisions contained in the Indentures.
(j) If the Securities include Preferred Stock convertible into
Capital Securities or other preferred stock and/or Subordinated Debt
Securities convertible into Capital Securities, the Capital Securities
or preferred stock issuable upon conversion of the shares of Preferred
Stock pursuant to their terms and the terms of the Certificate of
Amendment and/or the Capital Securities issuable upon conversion
<PAGE> 8
8
of the Subordinated Debt Securities pursuant to their terms and the
terms of the Subordinated Indenture, on the date of the Terms Agreement
relating to such Securities, shall be duly authorized and validly
reserved for issuance upon such conversion by all necessary corporate
action and such Capital Securities or other preferred stock, when
issued upon such conversion will be validly issued, fully paid and
non-assessable; no holder thereof will be subject to personal liability
by reason of being such a holder; and the issuance of such Capital
Securities or other preferred stock upon such conversion will not be
subject to preemptive rights.
(k) If the Securities include Depositary Shares, the Deposit
Agreement has been duly authorized by the Company, will be
substantially in the form filed as an exhibit to the Registration
Statement and, when duly executed and delivered by the Company and the
Depositary, will constitute a legal, valid and binding obligation of
the Company enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization, moratorium
or other similar laws relating to or affecting creditors' rights
generally and to general equity principles; and the summary description
of the Deposit Agreement set forth in the Prospectus conforms in all
material respects to the provisions contained in the Deposit Agreement.
(l) If the Securities include Warrants, the Warrant Agreement
has been duly authorized by the Company, will be substantially in the
form filed as an exhibit to the Registration Statement and, when duly
executed and delivered by the Company and the Warrant Agent, will
constitute a legal, valid and binding obligation of the Company
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency (including, without limitation, laws relating
to fraudulent transfer), reorganization, moratorium or similar laws
relating to or affecting creditors' rights generally and to general
equity principles; and the summary description of the Warrant Agreement
conforms in all material respects to the provisions contained in the
Warrant Agreement.
(m) If applicable, the shares of a Company's Common Stock,
issuable upon conversion or exercise of any issue of Offered Securities
have been duly authorized and reserved for issuance upon such
conversion by all necessary corporate action and, when issued and
delivered in accordance with the provisions of this Agreement relating
thereto, will be validly issued, fully paid and non-assessable, no
holder thereof will be subject to personal liability by reason of being
such a holder; and the issuance of such shares upon such conversion
will not be subject to preemptive rights.
(n) The Securities conform in all material respects to the
summary descriptions thereof contained or incorporated by reference in
the Prospectus and such
<PAGE> 9
9
summary descriptions conform to the rights set forth in the instruments
defining the same.
(o) To the knowledge of the Company and except as set forth in
the Prospectus, there is no threatened action, suit or proceeding that
could reasonably be expected to result in any material adverse change
in the condition (financial or other), business or results of
operations of the Company and its subsidiaries, or could reasonably be
expected to materially and adversely affect the properties or assets
thereof.
(p) The Company has not taken and will not take, directly or
indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Securities or the Capital Securities.
(q) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change in the condition (financial or other),
business or results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Prospectus.
(r) The Company has complied and will comply with all
applicable provisions of Florida H.B. 1771, codified as Section 517.075
of the Florida statutes, and all regulations promulgated thereunder
relating to issuers doing business in Cuba.
(s) The aggregate amount of Securities to be purchased
pursuant to this Agreement does not exceed the amount remaining
registered under the Registration Statement.
Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters in connection
with an offering of Securities shall be deemed a representation and warranty by
the Company, as to the matters covered thereby, to each Underwriter
participating in such offering.
3. PURCHASE, SALE AND DELIVERY OF SECURITIES. On the basis of
the representations, warranties and agreements herein contained and contained in
the applicable Terms Agreement, but subject to the terms and conditions herein
and therein set forth, the Company agrees to issue and sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase from the
Company pursuant to the terms of a Terms Agreement.
If so authorized in the Terms Agreement, the Underwriters
may solicit offers from investors of the types set forth in the Prospectus to
purchase Securities from the
<PAGE> 10
10
Company pursuant to delayed delivery contracts ("Delayed Delivery Contracts").
Such contracts shall be substantially in the form of Exhibit I hereto but with
such changes therein as the Company may approve. As compensation for arranging
Delayed Delivery Contracts, the Company will pay to the Representatives on the
Closing Date, for the accounts of the Underwriters, a fee as follows: (i) in the
case of Debt Securities, Debt Warrants and Units consisting of Debt Securities
and Debt Warrants, an amount equal to the percentage set forth in the applicable
Terms Agreement of the principal amount of the Debt Securities or number of Debt
Warrants for which such Delayed Delivery Contracts are made; (ii) in the case of
Preferred Stock, Depositary Shares and Units consisting of Preferred Stock and
any other Securities, an amount equal to the percentage set forth in the
applicable Terms Agreement of the aggregate liquidation preference of the
Preferred Stock, including shares represented by such Depositary Shares, for
which Delayed Delivery Contracts are made; (iii) in the case of all other
Securities, an amount as set forth in the applicable Terms Agreement of
Securities for which such Delayed Delivery Contracts are made. Securities to be
purchased pursuant to Delayed Delivery Contracts are herein called "Contract
Securities". When Delayed Delivery Contracts are authorized in the applicable
Terms Agreement, the Company will enter into a Delayed Delivery Contract in each
case where a sale of Contract Securities arranged through you has been approved
by the Company but, except as the Company may otherwise agree, such Delayed
Delivery Contracts must be for at least the minimum amount of Contract
Securities set forth in the applicable Terms Agreement hereto, and the aggregate
amount of Contract Securities may not exceed the amount set forth in such
Schedule. The Company will advise you not later than 10:00 A.M., New York City
time, on the third full business day preceding the Closing Date (or at such
later time as you may otherwise agree) of the sales of Contract Securities that
have been so approved. You and the other Underwriters will not have any
responsibility in respect of the validity or performance of Delayed Delivery
Contracts.
The Representatives shall submit to the Company, at least
three business days prior to Closing Date, the names of any institutional
investors with which it is proposed that the Company will enter into Delayed
Delivery Contracts and the amount or number of Securities to be purchased by
each of them, and the Company will advise the Representatives, at least two
business days prior to Closing Date, of the names of the institutions with which
the making of Delayed Delivery Contracts is approved by the Company and the
amount or number of Securities to be covered by each such Delayed Delivery
Contract.
The amount of Securities to be purchased by each Underwriter
as set forth in the applicable Terms Agreement shall be reduced by an amount
which shall bear the same proportion to the total amount of Contract Securities
as the amount of Securities set forth opposite the name of such Underwriter
bears to the total amount of Securities set forth in the applicable Terms
Agreement, except to the extent that you determine that such reduction shall
be otherwise than in such proportion and so advise the Company; provided,
however,
<PAGE> 11
11
that the total amount of Securities to be purchased by all Underwriters shall be
the total amount of Securities set forth in the applicable Terms Agreement less
the aggregate amount of Contract Securities.
The Offered Securities to be purchased by the Underwriters
will be delivered by the Company to you for the accounts of the several
Underwriters at the office specified in the applicable Terms Agreement against
payment of the purchase price therefor by certified or official bank check or
checks in New York Clearing House (next day) funds payable to the order of the
Company at the office, on the date and at the times specified in such Terms
Agreement, or at such other time not later than eight full business days
thereafter as you and the Company determine, such time being herein referred to
as the "Offered Securities Closing Date". The Option Securities to be purchased
by the Underwriters will be delivered by the Company to you for the accounts of
the several Underwriters at the office specified in the applicable Terms
Agreement against payment of the purchase price therefor by certified or
official bank check or checks in New York Clearing House (next day) funds
payable to the order of the Company at the office, on the date and at the times
specified in such Terms Agreement, or at such other time not later than eight
full business days thereafter as you and the Company determine, such time being
herein referred to as the "Option Closing Date". The Offered Securities Closing
Date and the Option Securities Closing Date are hereinafter collectively
referred to as the "Closing Date". Such Securities will be prepared in
definitive form and in such authorized denominations and registered in such
names as you may require upon at least two business days' prior notice to the
Company and will be made available for checking and packaging at the office at
which they are to be delivered on the applicable Closing Date (or such other
office as may be specified for that purpose in the Terms Agreement) at least one
business day prior to the applicable Closing Date.
It is understood that you, acting individually and not in a
representative capacity, may (but shall not be obligated to) make payment to the
Company on behalf of any other Underwriter for Securities to be purchased by
such Underwriter. Any such payment by you shall not relieve any such Underwriter
of any of its obligations hereunder.
The Company will pay to you on the applicable Closing Date for
the account of each Underwriter any commission or other compensation that is
specified in the Terms Agreement. Such payment will be made by certified or
official bank check in New York Clearing House (next day) funds.
4. COVENANTS. The Company covenants and agrees with each
Representative and each Underwriter that:
(a) (i) If reasonably requested by you in connection with the
offering of the Offered Securities, the Company will prepare a
Preliminary Prospectus containing such information concerning the
Securities as you and the Company deem appropriate
<PAGE> 12
12
and (ii) immediately following the execution of each Terms Agreement,
the Company will prepare a Prospectus Supplement that complies with the
Securities Act and the Securities Act Regulations and that sets forth
the number or principal amount of Securities covered thereby, the names
of the Underwriters participating in the offering and the number or
principal amount of Securities which each severally has agreed to
purchase, the name of each Underwriter, if any, acting as
representative in connection with the offering, the price at which the
Securities are to be purchased by the Underwriters from the Company,
the initial public offering price, the selling concession and
reallowance, if any, and such other information concerning the
Securities as you and the Company deem appropriate in connection with
the offering of the Securities. The Company will promptly transmit
copies of the Prospectus Supplement to the Commission for filing
pursuant to Rule 424 under the Securities Act and will furnish to the
Underwriters named therein as many copies of any Preliminary
Prospectus, the Prospectus and the Prospectus Supplement as you shall
reasonably request.
(b) If at any time when the Prospectus is required by the
Securities Act to be delivered in connection with sales of the Offered
Securities any event shall occur or condition exist as a result of
which it is necessary, in the opinion of counsel for the Underwriters
or counsel for the Company, to amend the Registration Statement or
amend or supplement the Prospectus in order that the Prospectus will
not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein not
misleading in the light of the circumstances under which they were
made, or if it shall be necessary, in the opinion of either such
counsel, at any such time to amend the Registration Statement or amend
or supplement the Prospectus in order to comply with the requirements
of the Securities Act or the Securities Act Regulations, the Company
will promptly prepare and file with the Commission, subject to Section
4(d), such amendment or supplement as may be necessary to correct such
untrue statement or omission or to make the Registration Statement or
the Prospectus comply with such requirements. Neither the
Representatives' consent to, nor the Underwriters' delivery of, any
such amendment or supplement shall constitute a waiver of the
conditions set forth in Section 5.
(c) During the period when the Prospectus is required by the
Securities Act to be delivered in connection with sales of the Offered
Securities, the Company will, subject to Section 4(d), file promptly
all documents required to be filed with the Commission pursuant to
Section 13, 14 or 15(d) of the Exchange Act.
(d) During the period between the date of the applicable Terms
Agreement and the Closing Date, the Company will inform you of its
intention to file any amendment to the Registration Statement, any
supplement to the Prospectus or any document that would as a result
thereof be incorporated by reference in the
<PAGE> 13
13
Prospectus, will furnish you with copies of any such amendment,
supplement or other document and will not file any such amendment,
supplement or other document in a form to which you or your counsel
shall reasonably object.
(e) During the period when the Prospectus is required by the
Securities Act to be delivered in connection with sales of the Offered
Securities, the Company will notify you immediately, and confirm the
notice in writing, (i) of the effectiveness of any amendment to the
Registration Statement; (ii) of the mailing or the delivery to the
Commission for filing of any supplement to the Prospectus or any
document that would as a result thereof be incorporated by reference in
the Prospectus; (iii) of the receipt of any comments from the
Commission with respect to the Registration Statement, the Prospectus
or the Prospectus Supplement; (iv) of any request by the Commission for
any amendment to the Registration Statement or any supplement to the
Prospectus or for additional information relating thereto or to any
document incorporated by reference in the Prospectus; and (v) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, of the suspension of the
qualification of the Offered Securities for offering or sale in any
jurisdiction, or of the institution or threatening of any proceeding
for any of such purposes. The Company will use every reasonable effort
to prevent the issuance of any such stop order or of any order
suspending such qualification and, if any such order is issued, the
Company will use every reasonable effort to obtain the lifting thereof
at the earliest possible moment.
(f) The Company has furnished or will furnish to you as many
copies of the Registration Statement as originally filed and of all
amendments thereto, whether filed before or after the Registration
Statement becomes effective, copies of all exhibits and documents filed
therewith (including documents incorporated by reference into the
Prospectus pursuant to Item 12 of Form S-3 under the Securities Act)
and copies of all consents and certificates of experts as you may
reasonably request, and has furnished or will furnish to you, for each
other Underwriter, one copy of the Registration Statement as originally
filed and of each amendment thereto (including documents incorporated
by reference into the Prospectus but without exhibits).
(g) The Company will use its reasonable best efforts to
qualify the Offered Securities and, if applicable, any Debt Securities,
Preferred Stock or Common Stock which may be issuable pursuant to the
exercise of the applicable Warrants and Capital Securities into or for
which the Subordinated Debt Securities are convertible and the
Capital Securities, other preferred stock or Debt Securities into which
the shares of Preferred Stock are convertible for offering and sale
under the applicable securities laws of such states and other
jurisdictions as you may reasonably designate and to maintain such
qualifications in effect for a period of not less than one year from
the
<PAGE> 14
14
effective date of the Terms Agreement applicable to such Offered
Securities; provided, however, that the Company shall not be obligated
to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not
otherwise so subject. The Company will file such statements and reports
as may be required by the laws of each jurisdiction in which the
Offered Securities have been qualified as above provided.
(h) With respect to each sale of Offered Securities, the
Company will make generally available to its security holders as soon
as practicable, but not later than 90 days after the close of the
period covered thereby, an earnings statement of the Company (in form
complying with the provisions of Rule 158 of the Securities Act
Regulations) covering a period of 12 months beginning, in each case,
not later than the first day of the Company's fiscal quarter next
following the effective date (as defined in Rule 158) of the
Registration Statement relating to the Offered Securities.
(i) If and to the extent specified in the applicable Terms
Agreement, the Company will use its best efforts to effect the listing
of the Offered Securities and, if applicable, any Debt Securities,
Preferred Stock or Common Stock which may be issuable pursuant to the
exercise of the applicable Warrants and the Capital Securities, other
preferred stock or Debt Securities issuable upon conversion of
Preferred Stock and/or Capital Securities issuable upon conversion of
Subordinated Debt Securities, on the New York Stock Exchange or such
other national securities exchange as may be designated in the
applicable Terms Agreement by the Closing Date with respect to the
applicable Terms Agreement.
(j) For a period of five years after the Closing Date, the
Company will furnish to you copies of all annual reports, quarterly
reports and current reports filed with the Commission on Forms 10-K,
10-Q and 8-K, or such other similar forms as may be designated by the
Commission, and such other documents, reports and information as shall
be furnished by the Company to its stockholders generally.
(k) Between the date of the applicable Terms Agreement and the
Closing Date or such other date as is set forth in such Terms
Agreement, the Company will not, without your prior written consent,
directly or indirectly, sell, offer to sell, grant any option for the
sale of, or otherwise dispose of, the securities set forth in such
Terms Agreement, other than as set forth in such Terms Agreement.
(l) The Company, whether or not the transactions contemplated
hereunder are consummated or the Agreement is terminated, will pay all
expenses incident to the performance of its obligations hereunder, will
pay the expenses of printing or
<PAGE> 15
15
otherwise producing all documents relating to the offering, and will
pay, or reimburse the Underwriters, for any reasonable expenses
(including fees and disbursements of counsel) incurred by them in
connection with the matters referred to in Section 4(g) hereof and the
preparation of memoranda relating thereto, for any filing fee of the
National Association of Securities Dealers, Inc. relating to the
Securities, for any fees charged by investment rating agencies for
rating the Securities, for any fees and expenses of any Trustee and any
agent of any Trustee in connection with any Indenture and the
Securities, for any listing fees and for the cost of mailing any
Preliminary Prospectus. Notwithstanding the foregoing, if there is a
mistake in the written information furnished by the Representative or
Representatives to the Company for use in the Prospectus and if such
Prospectus is required to be reprinted pursuant to Sections 4(b) and
4(d), then the expense of reprinting such Prospectus shall be borne,
severally, by the Underwriter or Underwriters who shall have furnished
such incorrect information to such Representative or Representatives.
(m) The Company will apply the net proceeds from the sale of
the Securities as set forth in the Prospectus.
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the several Underwriters to purchase and pay for the Offered Securities as
provided herein shall be subject to the accuracy, as of the date hereof and the
date of any such Terms Agreement and the Closing Date (as if made at the Closing
Date), of the representations and warranties of the Company herein, to the
accuracy of the statements of the Company's officers made in any certificate
furnished pursuant to the provisions hereof, to the performance by the Company
of all of its covenants and other obligations hereunder and to the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission
in accordance with the Securities Act Regulations and Section 4(a) of
this Agreement. No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for
that purpose shall have been instituted or, to the knowledge of the
Company or any Underwriter, threatened by the Commission.
(b) Subsequent to the execution of the Terms Agreement, there
shall not have occurred (i) any change or any development in or
affecting particularly the business or properties of the Company or its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters, materially impairs the investment quality of the
Securities; (ii) the suspension of trading in any securities of the
Company by the Commission or a national securities exchange, or the
suspension of trading on the New York Stock Exchange or the American
Stock Exchange, or the fixing of minimum or maximum prices for trading,
or the requirement of maximum ranges for prices for securities, on the
New York Stock Exchange or the American Stock
<PAGE> 16
16
Exchange, by such Exchange or by order of the Commission or any other
governmental authority having jurisdiction; (iii) any banking
moratorium declared by Federal or New York authorities; (iv) any
downgrading in the rating accorded the Company's Debt Securities or
Preferred Stock by any "nationally recognized statistical rating
organization", as that term is defined by the Commission for purposes
of Rule 436(g)(2) under the Securities Act or any public announcement
that any such organization has under surveillance or review, with
possible negative implications, its rating of any of the Company's Debt
Securities or Preferred Stock; or (v) any outbreak or escalation of
hostilities in which the United States is involved, a declaration of
war by Congress, any other substantial national or international
calamity or any other event or occurrence of a similar character if, in
the judgment of a majority in interest of the Underwriters, including
any Representatives, the effect of any such outbreak, escalation,
declaration, calamity or other event or occurrence makes it impractical
or inadvisable to proceed with the completion of the sale of and
payment for the Securities. Promptly after the determination by such
majority in interest of the Underwriters that it is impractical or
inadvisable to proceed with the completion of the sale and payment for
the Securities, the Representatives shall notify the Company of such
determination in writing; but the omission so to notify the Company
shall not act to modify the rights of the Underwriters under this
Section 5(b).
(c) On the applicable Closing Date, you shall have received
the opinion of the General Counsel or any Senior Managing Counsel to
the Company and/or Thompson Hine & Flory P.L.L., counsel to the
Company, as indicated in the applicable Prospectus Supplement (it being
understood that any opinion with respect to Key Bank of New York, Key
Bank of Washington, Key Bank of Oregon, Key Bank of Maine, Key Bank of
Idaho, Key Bank of Utah, Key Bank of Wyoming, Key Bank of Alaska or Key
Bank of Colorado may be delivered by the General Counsel or any Senior
Managing Counsel to the Company), dated the Closing Date, together with
signed or reproduced copies of such opinion for each of the other
Underwriters, in form and substance satisfactory to you or your
counsel, to the effect that:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of Ohio
and is duly registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended; each of KeyBank
National Association and Key Bank USA, National Association
(the "National Banks") is a duly organized and validly
existing national banking association under the laws of the
United States and continues to hold a valid certificate to do
business as such; each of Key Bank of New York, Key Bank of
Washington, Key Bank of Oregon, Key Bank of Maine, Key Bank of
Idaho, Key Bank of Utah, Key Bank of Wyoming, Key Bank of
Alaska and Key Bank of Colorado (the "State Banks") is a duly
<PAGE> 17
17
organized and validly existing state-chartered banking
association under the laws of the States of New York,
Washington, Oregon, Maine, Idaho, Utah, Wyoming, Alaska and
Colorado, respectively, and each continues to hold a valid
certificate to do business as such; each of the Company, the
National Banks and the State Banks has full corporate power
and authority to conduct its business as described in the
Registration Statement and Prospectus and is duly qualified to
do business in each jurisdiction in which it owns or leases
real property, except where the failure to be so qualified,
considering all such cases in the aggregate, does not involve
a material risk to the business, properties, financial
position or results of operations of the Company and its
subsidiaries taken as a whole; and all of the outstanding
shares of capital stock of each of the National Banks and the
State Banks have been duly authorized and validly issued, are
fully paid and non-assessable (exceptions to be specified) and
(except as otherwise stated in the Registration Statement) are
owned beneficially by the Company subject to no security
interest, other encumbrance or adverse claim.
(ii) This Agreement, the applicable Terms Agreement
and any Delayed Delivery Contracts have been duly authorized,
executed and delivered by the Company.
(iii) The Offered Securities conform in all material
respects to the description thereof contained or incorporated
by reference in the Prospectus and such description conforms
in all material respects to the rights set forth in the
instruments defining the same.
(iv) If the Offered Securities include Debt
Securities, such Debt Securities have been duly authorized
and, when such Debt Securities are duly executed,
authenticated and delivered in the manner provided for in the
applicable Indenture and issued and paid for in accordance
with this Agreement and the applicable Terms Agreement, such
Debt Securities will constitute valid and binding obligations
of the Company entitled to the benefits of the applicable
Indenture and enforceable against the Company in accordance
with their terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other similar laws of general
applicability relating to or affecting creditors' rights and
to general equity principles; and, if the Offered Securities
include Subordinated Debt Securities that are convertible into
Capital Securities, then such Subordinated Debt Securities are
convertible into Capital Securities in accordance with their
terms and the terms of the Subordinated Indenture.
<PAGE> 18
18
(v) If the Offered Securities include Preferred
Stock, such shares of Preferred Stock have been duly
authorized and, when such shares of Preferred Stock are duly
executed and delivered and issued and paid for in accordance
with this Agreement and the applicable Terms Agreement, such
shares of Preferred Stock will have been validly issued, fully
paid and non-assessable and no holder thereof will be subject
to personal liability by reason of being such a holder; such
shares of Preferred Stock will not be subject to the
preemptive rights of any stockholder of the Company; and all
corporate action required to be taken for the authorization,
issue and sale of such shares of Preferred Stock has been
validly and sufficiently taken; and, if the Offered Securities
include shares of Preferred Stock that are to be represented
by Depositary Shares, then, upon deposit by the Company of
such shares of Preferred Stock with the Depositary pursuant to
the Deposit Agreement and the execution by the Depositary of
the Depositary Receipts evidencing the Depositary Shares, such
Depositary Shares shall represent legal and valid interests in
such shares of Preferred Stock; and, if the Offered
Securities, Debt Securities and Debt Securities include shares
of Preferred Stock that are convertible into Capital
Securities, Debt Securities or other preferred stock, then
such shares of Preferred Stock are convertible into Capital
Securities, Debt Securities or other preferred stock in
accordance with their terms and the terms of the Certificate
of Amendment.
(vi) If the Offered Securities include Warrants, such
Warrants have been duly authorized and, when such Warrants are
duly executed, authenticated and delivered in the manner
provided for in the Warrant Agreement and issued and paid for
in accordance with this Agreement and the applicable Terms
Agreement, such Warrants will constitute valid and binding
obligations of the Company entitled to the benefits of the
Warrant Agreement and enforceable against the Company in
accordance with their terms subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other similar laws
of general applicability relating to or affecting creditors'
rights and to general equity principles; and the Warrants are
exercisable for Debt Securities, shares of Preferred Stock or
Common Stock in accordance with their terms and the terms of
the Warrant Agreement.
(vii) If the Offered Securities include Debt
Securities or Preferred Stock convertible into Debt
Securities, the applicable Indenture has been duly authorized,
executed and delivered by the Company and constitutes a valid
and legally binding instrument of the Company enforceable in
accordance with its terms subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other similar laws
of general applicability relating to or affecting creditors'
<PAGE> 19
19
rights and to general equity principles; and each applicable
Indenture has been duly qualified under the Trust Indenture
Act.
(viii) If the Offered Securities include Preferred
Stock convertible into Capital Securities or other preferred
stock and/or Subordinated Debt Securities convertible into
Capital Securities, the Capital Securities or other preferred
stock issuable upon conversion of the shares of Preferred
Stock pursuant to their terms and the terms of the Certificate
of Amendment and/or the Capital Securities issuable upon
conversion of the Subordinated Debt Securities pursuant to
their terms and the terms of the Subordinated Indenture, have
been duly authorized and validly reserved for issuance upon
such conversion by all necessary corporate action and such
Capital Securities or other preferred stock, when issued upon
such conversion, will be validly issued, fully paid and
nonassessable and no holder thereof will be subject to
personal liability by reason of being such a holder; and the
issuance of such Capital Securities or other preferred stock
upon such conversion will not be subject to preemptive rights.
(ix) If the Offered Securities include Depositary
Shares, the Deposit Agreement has been duly authorized,
executed and delivered by the Company, and assuming due
authorization, execution and delivery thereof by the
Depositary, constitutes a valid and binding obligation of the
Company enforceable in accordance with its terms, subject, as
to enforcement, to bankruptcy, insolvency, reorganization and
other similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(x) If the Offered Securities include Warrants, the
Warrant Agreement has been duly authorized, executed and
delivered by the Company and, assuming due authorization,
execution and delivery thereof by the Warrant Agent,
constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and
other similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(xi) The issue and sale of the Offered Securities and
the performance by the Company of its obligations under the
Offered Securities, the Indenture and this Agreement or other
agreement pursuant to which the Underwriters purchase Offered
Securities and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a
breach or violation of any of the terms and provisions of, or
constitute a default under,
<PAGE> 20
20
any statute, rule or regulation, any agreement or instrument
known to such counsel to which the Company is a party or by
which it is bound, the Company's Articles of Incorporation or
Regulations, or any order known to such counsel of any court
or governmental agency or body having jurisdiction over the
Company.
(xii) No consent, approval, authorization, order,
registration or qualification of or filing with any court or
governmental agency or body is required for the issue and sale
of Securities or the consummation of the other transactions
contemplated by this Agreement, any applicable Terms Agreement
or other agreement pursuant to which an Underwriter purchases
Securities, except such consents, approvals, authorizations,
registrations or qualifications as have been obtained under
the Securities Act and the Trust Indenture Act and as may be
required under state securities or Blue Sky laws in connection
with purchases of Securities.
(xiii) The Registration Statement has become
effective under the Securities Act; any required amendment or
supplement to the Prospectus has been filed as required by
Section 4(a) hereof; and to the best knowledge of such counsel
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose
has been instituted or threatened by the Commission.
(xiv) Such counsel is of the opinion ascribed to it
in the Prospectus under the caption "United States Tax
Considerations", if any.
(xv) The Registration Statement and the Prospectus,
each as amended or supplemented on the Closing Date (except
for the financial statements and other financial and
statistical data contained therein or omitted therefrom and
the Statement of Eligibility (Form T-1) under the Trust
Indenture Act of the Trustee as to which such counsel need
express no opinion) complied as to form in all material
respects with the requirements of the Securities Act and the
Exchange Act and the respective rules thereunder, and such
counsel has no reason to believe that the Registration
Statement, as amended (except for the financial statements and
other financial or statistical data contained or incorporated
therein or omitted therefrom and the Statement of Eligibility
(Form T-1) under the Trust Indenture Act of the Trustee as to
which such counsel need express no opinion) at the time it
became effective and at the date of this Agreement, contained
any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading or that the
Prospectus, as amended or supplemented (except for the
financial statements and other financial or
<PAGE> 21
21
statistical data contained or incorporated therein or omitted
therefrom and the Statement of Eligibility (Form T-1) under
the Trust Indenture Act of the Trustee as to which such
counsel need express no opinion) as of the Closing Date,
contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; and they do not know of any
amendment to the Registration Statement required to be filed
which is not filed as required.
Such opinion or opinions shall be to such further effect with respect
to other legal matters relating to this Agreement, any Delayed Delivery
Contracts and the sale of the Offered Securities, pursuant to this
Agreement as counsel for the Underwriters may reasonably request. Such
opinion or opinions shall be limited to New York, Ohio, Washington and
Federal law and, if applicable, the law of the state of incorporation
of any other Significant Subsidiary. In giving such opinion, such
counsel may rely, as to all matters governed by the laws of
jurisdictions in which such counsel is not qualified and the federal
law of the United States, upon opinions of other counsel, who shall be
counsel satisfactory to counsel for the Underwriters, in which case the
opinion shall state that they believe you and they are entitled to so
rely. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company, the National
Banks and the State Banks and the Significant Subsidiaries and
certificates of public officials.
In rendering their opinion, such counsel may rely upon the
opinion of Shearman & Sterling referred to below as to any matters
governed by New York law covered therein.
(d) At the applicable Closing Date, you shall have received
the favorable opinion of Shearman & Sterling, Counsel for the
Underwriters, such opinion or opinions, dated the Closing Date,
together with signed or reproduced copies of such opinion for each of
the other Underwriters, to the effect that the opinion delivered
pursuant to Section 5(c) appears on its face to be appropriately
responsive to the requirements of this Agreement and the applicable
Terms Agreement and with respect to the incorporation of the Company,
the validity of the Securities, the Registration Statement, the
Prospectus and other related matters as you reasonably may request and
such counsel shall have received such papers and information as they
request to enable them to pass upon such matters. In rendering their
opinion, such counsel may rely upon the opinion rendered on behalf of
the Company referred to above as to all matters governed by Ohio law.
<PAGE> 22
22
(e) At or prior to the time of execution of the applicable
Terms Agreement and on the Closing Date, you shall have received a
letter from Ernst & Young LLP, dated the date of delivery thereof, to
the effect set forth in Exhibit II hereto.
(f) You shall have received from the Company a certificate,
signed by the Chairman of the Board, the President or an Executive Vice
President, and by the principal financial or accounting officer, of the
Company, dated the Closing Date, to the effect that, to the best of
their knowledge based upon reasonable investigation:
(i) The representations and warranties of the Company
in this Agreement are true and correct, as if made at and as
of the Closing Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date; and
(ii) No stop order suspending the effectiveness of
the Registration Statement has been issued, and no proceeding
for that purpose has been instituted or is threatened by the
Commission.
(g) The Securities shall have been duly authorized for listing
on such exchange, if any, and at such time as specified in the
applicable Terms Agreement.
(h) In the event the Underwriters exercise their option
provided in a Terms Agreement to purchase all or a portion of the
Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by
the Company hereunder shall be true and correct as of each Option
Securities Closing Date, and you shall have received:
(1) A certificate, dated such Option Securities
Closing Date, signed by the Chairman of the Board, the
President or an Executive Vice President, and by the principal
financial or accounting officer of the Company, confirming
that the certificate delivered at the Closing Date pursuant to
Section 5(f) hereof remains true and correct as of such Option
Securities Closing Date.
(2) The favorable opinion of the General Counsel or
any Senior Managing Counsel to the Company and/or Thompson
Hine & Flory P.L.L., Counsel to the Company, in the form and
substance satisfactory to Counsel for the Underwriters, dated
the Option Securities Closing Date, relating to the Option
Securities and otherwise in substantially to the same effect
as the opinion required by Section 5(c) hereof.
<PAGE> 23
23
(3) The favorable opinion of Shearman & Sterling,
Counsel for the Underwriters, dated the Option Securities
Closing Date, relating to the Option Securities and otherwise
in substantially to the same effect as the opinion required by
Section 5(d) hereof.
(4) A letter from Ernst & Young LLP in the form and
substance satisfactory to you and dated the Option Securities
Closing Date, substantially the same in scope and substance as
the letter furnished to you pursuant to Section 5(e) hereof,
except that the "specified date" in the letter shall be a date
not more than five days prior to such Option Securities
Closing Date.
(i) The Company shall have furnished to you such further
certificates and documents as you shall have reasonably requested.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you. The Company will furnish you with such conformed copies of
such opinions, certificates, letters and other documents as you shall reasonably
request. If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, the applicable Terms Agreement
may be terminated by you by notice to the Company at any time at or prior to the
applicable Closing Date, and such termination shall be without liability of any
party to any other party except as provided in Section 4 hereof. Notwithstanding
any such termination, the provisions of Sections 6, 7, 8 and 9 shall remain in
effect.
6. UNDERWRITERS' EXPENSES. If the sale of the Securities
provided for herein is not consummated by reason of any failure, refusal or
inability on the part of the Company to perform any agreement on its part to be
performed, or because any other condition of the Underwriters' obligations
hereunder required to be fulfilled by the Company is not fulfilled, other than
by reason of a default by any of the Underwriters or the occurrence of any event
specified in clause (ii), (iii) or (v) of Section 5(b), the Company will
reimburse the Underwriters severally upon demand for all reasonable
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities. Except as otherwise provided for herein or in the
applicable Terms Agreement, the Underwriters shall pay their own expenses
(including fees and disbursements of counsel) in connection with the offering
and sale of the Securities.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material
<PAGE> 24
24
fact contained in any part of the Registration Statement when such part became
effective, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, or any other prospectus with respect to the Securities, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending against such loss, claim, damage, liability or action
as such expenses are incurred; provided, however, that (i) the Company shall not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by you, or by any
Underwriter through you, specifically for use therein and (ii) such indemnity
with respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) to the extent that any
such loss, claim, damage or liability of such Underwriter results from the fact
that such Underwriter sold Securities to a person as to whom it shall be
established that there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or of the Prospectus as then amended or supplemented
(excluding documents incorporated by reference) in any case where such delivery
is required by the Securities Act if the Company has previously furnished copies
thereof in sufficient quantity to such Underwriter and the loss, claim, damage
or liability of such Underwriter results from an untrue statement or omission of
a material fact contained in the Preliminary Prospectus which was corrected in
the Prospectus (excluding documents incorporated by reference) or in the
Prospectus as then amended or supplemented (excluding documents incorporated by
reference).
(b) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any part of the Registration Statement when such part
became effective, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, or any other prospectus relating to the Securities, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made therein in reliance upon and in conformity with written
information furnished to the Company by you, or by such Underwriter through you,
specifically for use therein, and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending against any such loss, claim, damage, liability or
action as such expenses are incurred.
<PAGE> 25
25
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party; provided,
however, that, if the defendants in any such action (including any impleaded
parties) include both the indemnified party and the indemnifying party and
representations of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them, the indemnified party
or parties shall have the right to select separate counsel to participate in the
defense of such action on behalf of such indemnified party or parties (and the
reasonable fees and expenses of one such separate counsel shall be paid by the
indemnifying party). No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities,
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law or if the indemnified party failed to
give the notice required under subsection (c) above, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the
Underwriters on the other in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand and the Underwriters on the other shall be deemed to be in the
same proportion as the total proceeds from the offering of the Securities
(before deducting expenses) received by the Company bear to the total
compensation or profit (before deducting expenses) received or realized by the
Underwriters from the purchase and resale, or underwriting, of the Securities.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters and the parties' relative intent,
knowledge, access to
<PAGE> 26
26
information and opportunity to correct or prevent such untrue statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were to be determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the first sentence of this
subsection (d). The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
against any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute shall be several in proportion to their
respective underwriting obligations and not joint.
(e) The obligations of the Company under this Section 7 shall
be in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter within the meaning of the Securities Act; and the obligations of
the Underwriters under this Section 7 shall be in addition to any liability that
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company (including any person who,
with his consent, is named in the Registration Statement as about to become a
director of the Company), to each officer of the Company who has signed the
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Securities Act.
8. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties, indemnities and agreements of the Company herein or
in certificates of officers of the Company delivered pursuant hereto, and the
agreements of the several Underwriters contained in Section 7 hereof, shall
remain operative and in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf of any
Underwriter or any controlling person, or the Company or any of its officers,
directors or any controlling person, and shall survive delivery of and payment
for the Securities.
9. SUBSTITUTION OF UNDERWRITERS. If one or more of the
Underwriters participating in an offering of Offered Securities shall fail at
the applicable Closing Date to
<PAGE> 27
27
purchase the Offered Securities which it or they are obligated to purchase
hereunder and under the applicable Terms Agreement (the "Defaulted Securities"),
you shall have the right, within 36 hours thereafter, to make arrangements
satisfactory to you and the Company for one or more of the nondefaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, you have not completed such arrangements
within such 36- hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the number of Offered Securities to be purchased pursuant to such
Terms Agreement, the nondefaulting Underwriters named in such Terms
Agreement shall be obligated to purchase the full amount thereof in the
proportions that their respective underwriting obligations bear to the
underwriting obligations of all nondefaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
Offered Securities to be purchased pursuant to such Terms Agreement,
the applicable Terms Agreement shall terminate without liability on the
part of any nondefaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default under this
Agreement and the applicable Terms Agreement.
In the event of any such default that does not result in the
termination of the applicable Terms Agreement, either you or the Company shall
have the right to postpone the applicable Closing Date for a period not
exceeding seven days in order to effect any required changes in the Registration
Statement or Prospectus or in any other documents or arrangements. As used
herein, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 9.
10. NOTICES. All notices or communications hereunder shall be
in writing and if sent to you shall be mailed, delivered, telexed or telecopied
and confirmed to you at the address set forth for that purpose in the Terms
Agreement, or if sent to the Company, shall be mailed, delivered, telexed,
telecopied or telegraphed and confirmed to the Company at 127 Public Square,
Cleveland, Ohio 44114-1306, ATTENTION: Secretary and General Counsel, telecopy
number: (216) 689-4121, with a COPY TO Senior Managing Counsel -- Securities.
Notice to any Underwriter pursuant to Section 7 hereof shall be mailed,
delivered, telexed, telecopied or telegraphed and confirmed to such
Underwriter's address as it appears in such Underwriter's questionnaire or other
notice furnished to the Company in writing for the purpose of communications
hereunder. Any party to this Agreement may change such address for notices by
sending to the parties to this Agreement written notice of a new address for
such purpose.
<PAGE> 28
28
11. PARTIES. This Agreement shall inure solely to the benefit
of and be binding upon the Company and the Underwriters and their respective
successors and the controlling persons, officers and directors referred to in
Section 7 hereof, and no other person will have any right or obligation
hereunder. In all dealings with the Company under this Agreement, you shall act
on behalf of each of the several Underwriters, and any action under this
Agreement taken by you or by any one of you designated in the applicable Terms
Agreement will be binding upon all the Underwriters.
12. APPLICABLE LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
<PAGE> 29
EXHIBIT A
KEYCORP
(an Ohio corporation)
[Title of Securities]
TERMS AGREEMENT
Dated: ______________, 199_
To: KeyCorp
127 Public Square
Cleveland, Ohio 44114
Attention:
Dear Sirs:
We (the "Representative") understand that KeyCorp, an Ohio
corporation (the "Company"), proposes to issue and sell [[$ aggregate
principal amount] of its [senior debt securities] [and] [subordinated
[convertible] debt securities] (the "Debt Securities")] [and]_________ [shares
of its [convertible]] preferred stock (the "Preferred Stock")] [_____________
depositary shares (the "Depositary Shares") each representing ______ of a
share of____________ preferred stock]. Subject to the terms and conditions set
forth herein or incorporated by reference herein, the Underwriters named below
(the "Underwriters") offer to purchase, severally and not jointly, the
respective amounts of [Debt Securities] [and] [Preferred Stock] [Depositary
Shares] set forth below.
<TABLE>
<CAPTION>
Principal Principal Principal
Amount of Amount of Amount of
Name of Debt Preferred Depositary
UNDERWRITER SECURITIES STOCK SHARES
----------- ---------- ----- ------
<S> <C> <C> <C>
---------- ---------- ----------
Total $ $ $
---------- ---------- ----------
</TABLE>
<PAGE> 30
A-2
DEBT SECURITIES
---------------
Title of Debt Securities:
Principal amount to be issued: $
Senior or Subordinated:
Currency:
Current ratings:
Interest rate or formula: %
Interest payment dates:
Date of maturity:
Redemption provisions:
Sinking fund requirements:
Initial public offering price % of the principal amount, plus
accrued interest, if any, [or amortized original
issue discount, if any,] from ____, 19__.
Purchase price: % of the principal amount, plus
accrued interest, if any, [or amortized
original issue discount, if any,] from ____,
19__ (payable in next day funds).
Listing requirement: [None] [NYSE] [OTHER]
Convertible:
Conversion provisions:
Closing date and location:
Additional representations, if any:
<PAGE> 31
A-3
Redemption provisions:
Lock-up provisions:
Sinking fund requirements:
Number of Option Securities, if any:
Other terms and conditions:
<PAGE> 32
A-4
PREFERRED STOCK
---------------
Title of Preferred Stock:
Principal amount to be issued: $
Currency:
Annual cash dividend rate: % Payable:
Liquidation preference per Share:
Initial public offering price %, plus accrued interest or
amortized original issue discount, if any, from
______, 19___.
Purchase price: %, plus accrued interest or amortized
original issue discount, if any, from
______, 19____ (payable in next day funds).
Listing requirement: [None] [NYSE] [OTHER]
Convertible:
Initial Conversion price: $___ per share of [Common Stock] [Preferred
Stock] [Capital Securities].
Other conversion provisions:
Closing date and location:
Additional representations, if any:
Redemption provisions:
Lock-up provisions:
Sinking fund requirements:
Number of Option Securities, if any:
Other terms and conditions:
<PAGE> 33
A-5
DEPOSITARY SHARES
-----------------
Title of Depositary Shares:
Principal amount to be issued: $
Currency:
Fractional amount of Preferred
Stock represented by
each Depositary Share:
Initial public offering price
per Depositary Share: % of the principal amount, plus accrued
interest [or amortized original issue
discount], if any, from _______, 19__.
Purchase price per Depositary Share:
(amount equal to the initial public
offering price set forth above, less
$_____ per Depositary Share).
Annual cash dividend amount: $ Payable:
Closing date and location:
Additional representations, if any:
Redemption provisions:
Lock-up provisions:
Sinking fund requirements:
Number of Option Securities, if any:
Other terms and conditions:
<PAGE> 34
A-6
WARRANTS
--------
Title of Warrants:
Number to be issued:
Currency:
Initial public offering price per Warrant: $
Purchase price per Warrant: $
Listing requirement: [None] [NYSE] [OTHER]
Exercisable for:
Exercise price:
Exercise provisions:
Closing date and location:
Additional representations, if any:
Redemption provisions:
Lock-up provisions:
Other terms and conditions:
Each Underwriter severally agrees, subject to the terms and
provisions of the above referenced Underwriting Agreement Standard Provisions
which is incorporated herein in its entirety and made a part hereof, to purchase
the principal amount of Offered Securities set forth opposite its name and a
proportionate share of Option Securities to the extent any are purchased.
This Agreement shall be governed by and construed in
accordance with, the laws of the State of New York.
<PAGE> 35
A-7
If the foregoing is in accordance with your understanding of
the agreement between you and the Company, please sign and return to the Company
a counterpart hereof, whereupon this instrument, along with all counterparts and
together with the Underwriting Agreement Standard Provisions, shall be a binding
agreement between the Underwriters named herein and the Company in accordance
with its terms and the terms of the Underwriting Agreement Standard Provisions.
[Representative[s]]
By _______________________________________
Acting on behalf of themselves and the
other named Underwriters
Confirmed and accepted as of
the date first above written:
KeyCorp
By_________________________
Name and Title:
<PAGE> 36
EXHIBIT I
KEYCORP
[Title of Securities]
DELAYED DELIVERY CONTRACT
-------------------------
-------------------------
[Insert date]
KeyCorp
[Names of Representatives]
Gentlemen:
The undersigned hereby agrees to purchase from KeyCorp (the
"Company"), and the Company agrees to sell to the undersigned, as of the date
hereof, for delivery on _______, 19__ ("Delivery Date") $_________ principal
amount of the Company's [insert title of Security] (the "Securities"), offered
by the Company's Prospectus relating thereto, receipt of a copy of which is
hereby acknowledged, at a purchase price of [ % of the principal amount thereof
plus accrued interest, if any, from ______, 19__,] [and $____ per share of
Preferred Stock] [and $ per Warrant, respectively] to the Delivery Date and on
the further terms and conditions set forth in this contract.
Payment for the Securities that the undersigned has agreed to
purchase for delivery on a Delivery Date shall be made to the Company or its
order by certified or official bank check in New York Clearing House (next day)
funds at the office of______________________________________________________ at
__ A.M. on that Delivery Date upon delivery to the undersigned of the Securities
to be purchased by the undersigned for delivery on that Delivery Date in
definitive form and in such denominations and registered in such names as the
undersigned may designate by written or telegraphic communication addressed to
the Company not less than five full business days prior to that Delivery Date.
The obligation of the Company to make delivery of and accept
payment for, and the obligation of the undersigned to take delivery of and make
payment for, Securities on the Delivery Date shall be subject only to the
conditions that (1) investment in the Securities shall not on the Delivery Date
be prohibited under the laws of any jurisdiction to which the
<PAGE> 37
I-2
undersigned is subject, which investment the undersigned represents is not
prohibited on the date hereof, and (2) the Company, on or before _______, 19__,
shall have sold to the Underwriters the amount of the Securities to be sold to
them pursuant to the Underwriting Agreement referred to in the Prospectus
mentioned above.
Promptly after completion of the sale to the Underwriters, the
Company will mail or deliver to the undersigned at its address set forth below
notice to such effect, accompanied by a copy of the opinion of counsel for the
Company delivered to the Underwriters in connection therewith.
This contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors, but will not be assignable
by either party hereto without the written consent of the other.
It is understood that the Company will not accept Delayed
Delivery Contracts for an aggregate principal amount of Securities in excess of
$_____ and that the acceptance of this contract and any other similar contracts
is in the Company's sole discretion and, without limiting the foregoing, need
not be on a first-come, first-served basis. If this contract is acceptable to
the Company, it is requested that the Company sign the form of acceptance below
and mail or deliver one of the counterparts hereof to the undersigned at its
address set forth below. This will become a binding contract between the
Company and the undersigned when such counterpart is so mailed or delivered.
<PAGE> 38
I-3
This contract shall be governed by, and construed in
accordance with, the laws of the State of New York.
Very truly yours,
---------------------------------
(Name of Purchaser)
By:
---------------------------------
(Title of Signatory)
---------------------------------
---------------------------------
(Address of Purchaser)
Accepted, as of the above date.
KeyCorp
By:___________________________
[Insert title]
<PAGE> 39
EXHIBIT II
Pursuant to Section 5(e) of the Underwriting Agreement, the
independent auditors shall furnish letters to the Underwriters to the effect
that:
(1) They are independent public accountants with respect to
the Company and its subsidiaries within the meaning of the Securities Act and
the applicable published Securities Act Regulations.
(2) In their opinion, the consolidated financial statements
and any supplemental financial information or schedules audited by them and
included or incorporated by reference in the Registration Statement or
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Securities Act or the Exchange Act, as
applicable, and the published rules and regulations thereunder.
(3) On the basis of procedures referred to in such letter,
including a reading of the minute books of the Company since the end of the most
recent fiscal year with respect to which an audit report has been issued,
performing the procedures specified by the American Institute of Certified
Public Accountants for a review of interim financial information as described in
SAS No. 71, Interim Financial Information, on the unaudited consolidated interim
financial statements of the Company included or incorporated by reference in the
Registration Statement and Prospectus and reading the internal unaudited
consolidated interim financial data, if any, for the period from the date of the
latest balance sheet included or incorporated by reference in the Registration
Statement and Prospectus to the date of the latest available internal interim
financial data (which internal unaudited interim financial data, if any, will be
attached to each such letter to the Underwriters); and making inquiries of
officials of the Company responsible for financial and accounting matters
(including inquiries with respect to whether the unaudited consolidated
financial statements comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act and inquiries of certain
officials of the Company who have responsibility for financial and accounting
matters whether the internal unaudited consolidated interim financial statements
are stated on a basis substantially consistent with that of the audited
consolidated financial statements incorporated by reference in the Registration
Statement), nothing caused them to believe that:
(A) (i) any material modifications should be made to the
unaudited consolidated financial statements included in any Quarterly
Reports on Form 10-Q which are incorporated by reference in the
Registration Statement or Prospectus (the "10-Q Financials") for them
to be in conformity with generally accepted accounting principles
applicable to such financial statements and (ii) the 10-Q Financials do
not comply as to form in all material respects with the applicable
requirements of the Exchange Act as it applies to Form 10-Q and the
related published rules and regulations; or
<PAGE> 40
II-2
(B) the internal unaudited consolidated interim financial
statements of the Company are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
that of the audited consolidated financial statements incorporated by
reference in the Registration Statement; or
(C) at the date of the latest available internal unaudited
consolidated interim financial statements of the Company, there was ANY
INCREASE IN CONSOLIDATED LONG-TERM DEBT OR any decrease in consolidated
shareholders' equity as compared with amounts shown in the latest
balance sheet included or incorporated by reference in the Prospectus
except in all instances for decreases that the Prospectus discloses
have occurred or may occur or as may be set forth in such letter; or
(D) for the period from the date of the latest balance sheet
included or incorporated by reference in the Prospectus to the date of
the latest available internal financial statements of the Company,
there was any decrease, as compared with the corresponding period of
the previous year, in consolidated net interest income, consolidated
net interest income after provision for possible loan losses,
consolidated income before taxes or in the total or per common share
amounts of consolidated net income, except in all cases for changes or
decreases that the Prospectus discloses have occurred or may occur or
as may be set forth in such letter;
(E) as of a specified date not more than five days prior to
the date of delivery of such letter to the Representative(s), there was
ANY INCREASE IN CONSOLIDATED LONG-TERM DEBT OR any decrease in
consolidated shareholders' equity as compared with the [amount shown in
the latest balance sheet included or incorporated by reference in the
Prospectus/amount shown in the latest internal unaudited consolidated
interim financial statements], except for any decrease that the
Registration Statement discloses has occurred or may occur.
(4) In addition to their examination referred to in their
reports incorporated by reference in the Registration Statement and Prospectus
and the procedures referred to in (3) above, (a) they have carried out certain
other procedures, not constituting an audit, with respect to certain of the
dollar amounts, percentages and other financial information (in each case to the
extent that such dollar amounts, percentages and other financial information,
either directly or by analysis or computation, are derived from the general
accounting records of the Company and its subsidiaries) which are included or
incorporated by reference in the Prospectus (other than those appearing in the
audited financial statements included therein) and appear in the Prospectus or
incorporated documents, as agreed to by officers of the Company and the
Representative(s), and have found such dollar amounts, percentages and financial
information to be in agreement with the general accounting records of the
Company and its subsidiaries and (b) if any pro forma financial information is
included or incorporated by reference in the Registration Statement and
Prospectus, they have carried out other
<PAGE> 41
II-3
procedures, not constituting an audit, with respect to such pro forma
financial information and indicated the results thereof, if requested by the
Representative(s) and agreed to by officers of the Company.
<PAGE> 1
EXHIBIT (1)(b)
KeyCorp
$750,000,000
Senior Medium-Term Notes, Series D
Subordinated Medium-Term Notes, Series C
Due 9 months or more from Date of Issue
DISTRIBUTION AGREEMENT
----------------------
August , 1996
SALOMON BROTHERS INC
Seven World Trade Center
New York, New York 10048
CHASE SECURITIES INC.
270 Park Avenue
New York, New York 10017
CITICORP SECURITIES, INC.
399 Park Avenue
New York, New York 10043
CS FIRST BOSTON CORPORATION
Park Avenue Plaza
55 East 52nd Street
New York, New York 10005
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, New York 10260
Dear Sirs:
KeyCorp, an Ohio corporation (the "Company"), confirms its
agreement with each of you with respect to the issue and sale from time to time
by the Company of its Senior Medium-Term Notes, Series D and Subordinated
Medium-Term Notes, Series C due 9 months or more from date of issue (the
"Notes") in an aggregate initial offering price of up to $750,000,000 (or the
equivalent thereof in one or more foreign currencies or composite
<PAGE> 2
2
currencies), as such amount shall be reduced by the aggregate initial offering
price of any other debt securities issued by the Company, whether within or
without the United States ("Other Securities") pursuant to the registration
statement referred to below, and agrees with each of you (individually, an
"Agent", and collectively, the "Agents", which term shall include any
additional agents appointed pursuant to Section 13 hereof) as set forth in this
Agreement. The Notes may be issued as senior indebtedness (the "Senior Notes")
or as subordinated indebtedness (the "Subordinated Notes") of the Company. The
Senior Notes will be issued under an indenture, dated as of June 10, 1994 (as
the same may be supplemented or amended from time to time, the "Senior
Indenture"), between the Company and Bankers Trust Company, as Trustee (the
"Senior Trustee"), and the Subordinated Notes will be issued under an
indenture, dated as of June 10, 1994 (as the same may be supplemented or
amended from time to time, the "Subordinated Indenture"), between the Company
and Bankers Trust Company, as Trustee (the "Subordinated Trustee"). The Senior
Indenture and Subordinated Indenture are herein sometimes collectively referred
to individually as an "Indenture" and collectively as "Indentures" and the
Senior Trustee and Subordinated Trustee are herein sometimes collectively
referred to individually as a "Trustee" and collectively as the "Trustees".
Wherever the terms "Indenture" and "Trustee" are used with respect to a
specific issuance of Notes they shall mean the Senior Indenture and Senior
Trustee, in the case of an issuance of unsecured and unsubordinated Notes, and
the Subordinated Indenture and Subordinated Trustee, in the case of an issuance
of unsecured and subordinated Notes. The Notes shall have the maturities,
interest rates, redemption provisions, if any, and other terms set forth in the
supplement to the Basic Prospectus referred to below. The Notes will be issued,
and the terms and rights thereof established, from time to time by the Company
in accordance with the Indenture.
On the basis of the representations and warranties herein
contained, but subject to the terms and conditions stated herein and to the
reservation by the Company of the right to sell Notes directly to investors
(other than broker-dealers, except as provided in Section 2(a)) on its own
behalf, the Company hereby (i) appoints the Agents as the agents of the Company
for the purpose of soliciting and receiving offers to purchase Notes from the
Company by others pursuant to Section 2(a) hereof and (ii) agrees that, except
as otherwise contemplated herein, whenever it determines to sell Notes directly
to any Agent as principal, it will enter into a separate agreement (each such
agreement, a "Terms Agreement"), substantially in the form of Exhibit A hereto,
relating to such sale in accordance with Section 2(b) hereof.
The Company has prepared and filed a registration statement on
Form S-3 (No. 33- ), including a prospectus, relating to the Notes with the
Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Securities Act").
The Company also has filed with, or proposes to file with, the Commission
pursuant to Rule 424 under the Securities Act supplements to the Basic
Prospectus included in the Registration Statement that will describe certain
terms of the Notes. The Registration Statement, including the exhibits thereto,
as amended to the Commencement Date (as hereinafter defined) is hereinafter
referred to as the "Registration Statement" and the prospectus in the form in
which it appears in the Registration Statement is hereinafter referred to as
the "Basic Prospectus." The Basic Prospectus as supplemented by the prospectus
supplement or supplements (each, a "Prospectus Supplement") specifically
relating to the
<PAGE> 3
3
Notes in the form filed with, or transmitted for filing to, the Commission
pursuant to Rule 424 under the Securities Act is hereinafter referred to as the
"Prospectus." Any reference in this Agreement to the Registration Statement,
the Basic Prospectus, any preliminary form of Prospectus (a "preliminary
prospectus") previously filed with the Commission pursuant to Rule 424 or the
Prospectus shall be deemed to refer to and include the documents, if any,
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Securities Act which were filed under the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") on or before the date of this Agreement or
the date of the Basic Prospectus, any preliminary prospectus or the Prospectus,
as the case may be; and any reference to "amend", "amendment" or "supplement"
with respect to the Registration Statement, the Basic Prospectus, any
preliminary prospectus or the Prospectus, including any supplement to the
Prospectus that sets forth only the terms of a particular issue of the Notes (a
"Pricing Supplement"), shall be deemed to refer to and include any documents
filed under the Exchange Act after the date of this Agreement, or the date of
the Basic Prospectus, any preliminary prospectus or the Prospectus, as the case
may be, which are deemed to be incorporated by reference therein.
1. REPRESENTATIONS. The Company represents and warrants to,
and agrees with, each Agent as of the Commencement Date (as hereinafter
defined), as of each date on which you solicit offers to purchase Notes, as of
each date on which the Company accepts an offer to purchase Notes (including any
purchase by an Agent as principal pursuant to a Terms Agreement or otherwise),
as of each date the Company issues and sells Notes and as of each date the
Registration Statement or the Basic Prospectus is amended or supplemented, as
follows (it being understood that such representations and warranties shall be
deemed to relate to the Registration Statement, the Basic Prospectus and the
Prospectus, each as amended or supplemented to each such date):
(a) The Registration Statement has been declared effective by
the Commission under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
the Company, threatened by the Commission.
(b) The Company meets the requirements for use of Form S-3
under the Securities Act and the Registration Statement and Prospectus
(as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) comply, or will comply, as the case
may be, in all material respects with the Securities Act and the Trust
Indenture Act of 1939, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Trust Indenture Act"); each
part of the Registration Statement and any amendment or supplement
thereto, as of the date such part became or becomes effective, did not
or will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading; each Prospectus, and any
amendment or supplement thereto, as of the date thereof, did not or
will not include an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representations or
warranties as to (i) that part of the Registration Statement which
shall
<PAGE> 4
4
constitute the Statement of Eligibility (Form T-1) under the Trust
Indenture Act of the Trustee or (ii) the information contained in or
omitted from the Registration Statement or the Prospectus or any
amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of any Agent specifically for use in connection with the
preparation of the Registration Statement and such Prospectus.
(c) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, comply, or will comply, as the case may be, in all
material respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus, or any amendment or
supplement thereto, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
(d) (i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Ohio, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and
is duly registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended, and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each jurisdiction in which it owns or leases
properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in
good standing, considering all such cases in the aggregate, does not
involve a material risk to the business, properties, financial position
or results of operations of the Company and its subsidiaries; (ii) each
of its national bank subsidiaries is a duly organized and validly
existing national banking association under the laws of the United
States, continues to hold a valid certificate to do business as such
and has full power and authority to conduct its business as such; each
of its state-chartered bank subsidiaries is a duly organized and
validly existing state-chartered bank under the laws of the
jurisdiction of its organization, continues to hold a valid certificate
to do business as such and has full power and authority to conduct its
business as such; each of its other significant subsidiaries, as
defined in Regulation S-X (the "Significant Subsidiaries"), is duly
organized and validly existing under the laws of the jurisdiction of
its organization with corporate power and authority under such laws to
conduct its business; and (iii) all of the outstanding shares of
capital stock of each such subsidiary have been duly authorized and
validly issued, are fully paid and non-assessable (except, with
respect to any subsidiary that is a national bank, as provided by
Section 55 of Title 12 of the United States Code; and, with respect to
any subsidiary that is a bank incorporated under state law, except as
provided by the laws of any such states and except as otherwise stated
in the Registration Statement) are owned
<PAGE> 5
5
beneficially by the Company subject to no security interest, pledge,
lien, charge or other encumbrance or adverse claim.
(e) Each of this Agreement and any other applicable Terms
Agreement has been duly authorized, executed and delivered by the
Company.
(f) The Notes have been duly authorized and established in
conformity with the provisions of the relevant Indenture, and, when
issued and delivered in accordance with the Indenture and delivered to
and paid for by the purchasers thereof in accordance with this
Agreement and any applicable Terms Agreement, will have been duly
executed, issued and delivered by the Company and will constitute valid
and binding obligations of the Company enforceable in accordance with
their terms subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other similar laws of general applicability relating
to or affecting creditors' rights and to general equity principles and
will be entitled to the benefits provided by the Indenture, the
Indenture has been duly authorized, executed and delivered by the
Company and qualified under the Trust Indenture Act and constitutes a
valid and binding instrument enforceable in accordance with its terms
subject, as to enforcement, to bankruptcy, insolvency, reorganization
and other similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture conforms, and the Notes of any particular issuance of Notes
will conform in all material respects, to the summary descriptions
thereof in the Prospectus as amended or supplemented to relate to such
issuance of Notes.
(g) The execution and delivery by the Company of this
Agreement, the Notes, the Indentures and any applicable Terms
Agreement, the issue and sale of the Notes and the performance by the
Company of all of its obligations under this Agreement, the Notes, the
Indentures and any Terms Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other material agreement or instrument to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action
contravene or result in any violation of the provisions of the Amended
and Restated Articles of Incorporation or the Regulations of the
Company or any applicable statute, rule or regulation or to the best of
its knowledge, any order of any court or governmental agency or body
having jurisdiction over the Company, its subsidiaries or any of their
respective properties.
(h) To the knowledge of the Company and except as set forth in
the Prospectus, there is no threatened action, suit or proceeding that
could reasonably be expected to result in any material adverse change
in the condition (financial or other), business or results of
operations of the Company and its subsidiaries, or could reasonably be
expected to materially and adversely affect the properties or assets
thereof.
<PAGE> 6
6
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change in the condition (financial or other),
business or results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Prospectus.
(j) The Company has complied and will comply with all
applicable provisions of Florida H.B. 1771, codified as Section 517.075
of the Florida Statutes, and all regulations promulgated thereunder
relating to issuers doing business in Cuba.
(k) Immediately after any sale of Notes by the Company
hereunder or under any applicable Terms Agreement, the aggregate amount
of Notes which shall have been issued and sold by the Company hereunder
or under any Terms Agreement and of any securities of the Company
(other than the Notes) that shall have been issued and sold pursuant to
the Registration Statement will not exceed the amount of securities
registered under the Registration Statement.
2. SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL. (a)
SOLICITATIONS AS AGENT. On the basis of the representations and warranties
herein contained, but subject to the terms and conditions herein set forth, each
of the Agents hereby severally and not jointly agrees, as agent of the Company,
to use its reasonable efforts to solicit offers to purchase the Notes from the
Company upon the terms and conditions set forth in the Prospectus as amended or
supplemented from time to time. So long as this Agreement shall remain in effect
with respect to any Agent, the Company shall not, without the consent of such
Agent, solicit or accept offers to purchase, or sell, Notes or any other debt
securities with a maturity at the time of original issuance of 9 months or more
except pursuant to this Agreement and any Terms Agreement, or except pursuant to
a private placement not constituting a public offering under the Securities Act
or except in connection with a firm commitment underwriting pursuant to an
underwriting agreement that does not provide for a continuous offering of
medium-term debt securities. However, the Company reserves the right to sell,
and may solicit and accept offers to purchase, Notes directly on its own behalf
to investors (other than broker-dealers, except to the extent set forth in the
next succeeding sentence). The Company may also sell Notes to an Agent acting as
principal for its own account or for resale to one or more investors. The
Company may from time to time offer Notes for sale otherwise than through an
Agent; provided, however, that so long as this Agreement shall be in effect the
Issuer shall not solicit or accept offers to purchase Notes through any agent
other than an Agent without amending this Agreement to appoint such agent an
additional Agent hereunder on the same terms and conditions as provided herein
for the Agents and without giving the Agents prior notice of such appointment;
except, that if from time to time the Company is approached by a prospective
agent offering to solicit a specific purchase of Notes, the Company may engage
such agent with respect to such specific purchase, only if, (i) such agent is
engaged on terms substantially similar (including the same commission schedule
as set forth herein) to the applicable terms of this Agreement (without being
required to become a party hereto) and (ii) the Agents are given notice of such
purchase promptly, in each case after the purchase is agreed to.
<PAGE> 7
7
The Company reserves the right, in its sole discretion, to
instruct the Agents to suspend at any time, for any period of time or
permanently, the solicitation of offers to purchase Notes. Upon receipt of at
least one business day's prior notice from the Company, each Agent will suspend
solicitation of offers to purchase Notes from the Company until such time as the
Company has advised such Agent or Agents that such solicitation may be resumed.
During the period of time that such solicitation is suspended, the Company shall
not be required to deliver any opinions, letters or certificates in accordance
with Sections 4(i), 4(j) and 4(k); provided that if the Registration Statement
or Prospectus is amended or supplemented during the period of suspension (other
than by an amendment or supplement providing solely for a change in the interest
rates, redemption provisions, amortization schedules or maturities offered for
the Notes or for a change that the Agents deem to be immaterial), no Agent shall
be required to resume soliciting offers to purchase Notes until the Company has
delivered such opinions, letters and certificates as such Agent may request.
The Company agrees to pay each Agent, as consideration for the
sale of each Note resulting from a solicitation made or an offer to purchase
received by such Agent, a commission in the form of a discount from the purchase
price of such Note in an amount equal to the following applicable percentage of
the principal amount of such Note sold:
<TABLE>
<CAPTION>
Commission
(percentage of
aggregate
principal amount
RANGE OF MATURITIES OF NOTES SOLD)
<S> <C>
From 9 months to less than 1 year ...................................................... .125%
From 1 year to less than 18 months...................................................... .150%
From 18 months to less than 2 years..................................................... .200%
From 2 years to less than 3 years....................................................... .250%
From 3 years to less than 4 years....................................................... .350%
From 4 years to less than 5 years....................................................... .450%
From 5 years to less than 6 years....................................................... .500%
From 6 years to less than 7 years....................................................... .550%
From 7 years to less than 10 years...................................................... .600%
From 10 years to less than 15 years..................................................... .625%
From 15 years to less than 20 years..................................................... .700%
From 20 years to 30 years............................................................... .750%
Greater than 30 years................................................................... Negotiated at the
time of issuance
</TABLE>
<PAGE> 8
8
The Agents are authorized to solicit offers to purchase Notes
only in the principal amount of $100,000 (or, in the case of Notes not
denominated in U.S. dollars, the equivalent thereof in the applicable foreign
currency or composite currency, rounded down to the nearest 1,000 units of such
foreign currency or composite currency) or any amount in excess thereof which is
an integral multiple of $1,000 (or, in the case of Notes not denominated in U.S.
dollars, 1,000 units of such foreign currency or composite currency). Each Agent
shall communicate to the Company, orally or in writing, each offer to purchase
Notes received by such Agent as agent that in its judgment should be considered
by the Company. The Company shall have the sole right to accept offers to
purchase the Notes and may reject any such offer in whole or in part. Each Agent
shall have the right, in its sole discretion, to reject any offer to purchase
Notes, as a whole or in part, that it considers to be unacceptable and any such
rejection shall not be deemed a breach of its agreements herein contained. The
procedural details relating to the issue and delivery of Notes sold by an Agent
as agent and the payment therefor are set forth in the Administrative Procedures
(as hereinafter defined).
(b) PURCHASE AS PRINCIPAL. Each sale of Notes to any Agent as
principal shall be made in accordance with the terms of this Agreement and
(unless such Agent shall otherwise agree) a Terms Agreement which will provide
for the sale of such Notes to, and the purchase and reoffering thereof by, such
Agent. Each Terms Agreement will take the form of Exhibit A hereto but may take
the form of either (i) a written agreement between you and the Company which may
be substantially in the form of Exhibit A hereto or (ii) an oral agreement
between you and the Company confirmed in writing by you to the Company.
The commitment of any Agent to purchase Notes as principal,
whether pursuant to any Terms Agreement or otherwise, shall be deemed to have
been made on the basis of the representations and warranties (made or deemed to
have been made as of the date of the Terms Agreement and as of the Time of
Delivery (as defined below)) of the Company herein contained and shall be
subject to the terms and conditions set forth herein and in the applicable Terms
Agreement. Each Terms Agreement by an Agent to purchase Notes as principal
(pursuant to a Terms Agreement or otherwise) shall specify the principal amount
of Notes to be purchased by such Agent pursuant thereto, the price to be paid to
the Company for such Notes, the maturity date of such Notes, the interest rate
or interest rate basis, if any, applicable to such Notes, any other terms of
such Notes, the time and date and place of delivery of and payment for such
Notes (the time and date of any and each such delivery and payment, the "Time of
Delivery"), any provisions relating to rights of, and default by, underwriters
acting together with such Agent in the reoffering of Notes, and shall also
specify any requirements for opinions of counsel, accountants' letters and
officers' certificates pursuant to Section 4 hereof. Unless otherwise specified
in a Terms Agreement, the procedural details relating to the issue and delivery
of Notes purchased by an Agent as principal and the payment therefor shall be
as set forth in the Administrative Procedures.
Unless otherwise specified in a Terms Agreement, if you are
purchasing Notes as principal you may resell such Notes to other dealers or to
investors and other purchasers.
<PAGE> 9
9
Any such sales to other dealers may be at a discount, which shall not exceed
the amount set forth in the Prospectus Supplement relating to such Notes. Any
such sales to investors and other purchasers may be at prevailing market
prices, or prices related thereto at the time of such resale, at negotiated
prices or otherwise, as determined by the Agent.
(c) OBLIGATIONS SEVERAL. The Company acknowledges that the
obligations of the Agents are several and not joint and, subject to the
provisions of this Section 2, each Agent shall have complete discretion as to
the manner in which it solicits purchasers for the Notes and as to the identity
thereof.
(d) ADMINISTRATIVE PROCEDURES. The Agents and the Company
agree to perform their respective duties and obligations specifically provided
to be performed in the Medium-Term Notes Administrative Procedures (the
"Administrative Procedures") attached hereto as Exhibit B, as the same may be
amended from time to time. The Administrative Procedures may be amended only by
written agreement of the Company and the Agents.
3. COMMENCEMENT DATE. The documents required to be delivered
pursuant to Section 6 hereof on the Commencement Date (as defined below) or as a
condition precedent to your obligation to begin soliciting offers to purchase
Notes as agent of the Company shall be delivered to the Agents at the offices of
Shearman & Sterling, 599 Lexington Avenue, New York, New York, at 11:00 A.M.,
New York City time, on the date of this Agreement, which date and time of such
delivery may be postponed by agreement between the Agents and the Company but in
no event shall be later than the day prior to the date on which solicitation of
offers to purchase Notes is commenced or the first date on which the Company
accepts an offer by any Agent to purchase Notes as principal (such time and date
being referred to herein as the "Commencement Date").
4. COVENANTS OF THE COMPANY. The Company covenants and agrees
with each Agent:
(a) (i) To make no amendment or supplement to the Registration
Statement or the Prospectus prior to the termination of the offering of
the Notes pursuant to this Agreement or any Terms Agreement which shall
be reasonably disapproved by any Agent after reasonable opportunity to
comment thereon, provided, however, that the foregoing shall not apply
to any of the Company's periodic filings with the Commission described
in subsection (iii) below, copies of which filings the Company will
cause to be delivered to the Agents promptly after their transmission
to the Commission for filing; (ii) subject to the foregoing clause
(i), promptly to cause each Prospectus Supplement to be filed with or
transmitted for filing to the Commission in accordance with Rule
424(b) under the Securities Act and to prepare, with respect to any
Notes to be sold through or to such Agent pursuant to this Agreement,
a Pricing Supplement with respect to such Notes in a form previously
approved by such Agent and to file such Pricing Supplement in
accordance with Rule 424(b) under the
<PAGE> 10
10
Securities Act; and (iii) promptly to file all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act for so long as the delivery of a prospectus
is required in connection with the offering or sale of the Notes. The
Company will promptly advise each Agent (A) of the filing of any
amendment or supplement to the Basic Prospectus or any amendment to
the Registration Statement and of the effectiveness of any such
amendment to the Registration Statement; (B) of the receipt of any
comments from the Commission with respect to the Registration
Statement, the Prospectus or the Prospectus Supplement; (C) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement; of the suspension of the
qualification of the Notes for offering or sale in any jurisdiction,
or the institution or threatening of any proceeding for any such
purpose, or of any request by the Commission for any amendment or
supplement of the Registration Statement or Prospectus or for
additional information relating thereto or to any document
incorporated by reference in the Prospectus; and (D) of the receipt by
the Company of any notification with respect to any suspension of the
qualification of the Notes for offering or sale in any jurisdiction,
or the initiation or threatening of any proceeding for any such
purpose. The Company agrees to use every reasonable effort to prevent
the issuance of any such stop order or of any order suspending any
such qualification and, if issued, to use every reasonable effort to
obtain the lifting thereof at the earliest possible moment. If the
Basic Prospectus is amended or supplemented as a result of the filing
under the Exchange Act of any document incorporated by reference in
the Prospectus, no Agent shall be obligated to solicit offers to
purchase Notes so long as it is not reasonably satisfied with such
document.
(b) To use its reasonable best efforts to qualify the Notes
for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Agents shall reasonably request and to continue
such qualification in effect so long as reasonably required in
connection with the distribution of the Notes and to pay all fees and
expenses (including fees and disbursements of counsel to the Agents)
reasonably incurred in connection with such qualification and in
connection with the determination of the eligibility of the Notes for
investment under the laws of such jurisdictions as such Agent may
reasonably designate; provided, however, that the Company shall not be
required to file a general consent to service of process or to qualify
as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. The Company will file such statements and
reports as may be required by the laws of each jurisdiction in which
the Notes have been qualified as above provided.
(c) To furnish each Agent and counsel to the Agents, at the
expense of the Company, a signed copy of the Registration Statement (as
originally filed) and each amendment thereto, in each case including
exhibits and documents incorporated by
<PAGE> 11
11
reference therein and, during the period mentioned in paragraph (d)
below, to furnish each Agent as many copies of the Prospectus
(including all amendments and supplements thereto) and documents
incorporated by reference therein as such Agent may reasonably
request.
(d) If at any time when a prospectus relating to the Notes is
required to be delivered under the Securities Act, any event shall
occur as a result of which, in the opinion of counsel for the Agents or
counsel for the Company, the Prospectus, as then amended or
supplemented, would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made not misleading, or, if in the opinion of the Agents or the
Company, it is necessary at any time to amend or supplement the
Prospectus, as then amended or supplemented, to comply with law, to
immediately notify the Agents by telephone (with confirmation in
writing) and request each Agent (i) in its capacity as agent of the
Company, to suspend solicitation of offers to purchase Notes from the
Company (and, if so notified, such Agent shall cease such solicitations
and cease using the Prospectus as soon as practicable, but in any event
not later than one business day later); and (ii) to cease sales of any
Notes such Agent may then own as principal. If the Company shall decide
to amend or supplement the Registration Statement or the Prospectus, as
then amended or supplemented, it shall so advise each Agent promptly by
telephone (with confirmation in writing) and, at its expense, shall
prepare and cause to be filed promptly with the Commission an amendment
or supplement to the Registration Statement or the Prospectus, as then
amended or supplemented, reasonably satisfactory in all respects to the
Agents, that will correct such statement or omission or effect such
compliance and will supply such amended or supplemented Prospectus to
the Agents in such quantities as you may reasonably request.
Notwithstanding the foregoing, if there is incorrect information in the
written information furnished by the Agent or Agents to the Company for
use in the Prospectus and if such Prospectus is required to be
reprinted, then the expense of reprinting such Prospectus shall be
borne, severally, by the Agent or Agents who shall have furnished such
incorrect information. If any such amendment or supplement and any
documents, opinions, letters and certificates furnished to the Agents
pursuant to Sections 4(e), 4(i), 4(j) and 4(k) in connection with the
preparation and filing of such amendment or supplement are reasonably
satisfactory in all respects to the Agents, upon the filing with the
Commission of such amendment or supplement to the Prospectus or upon
the effectiveness of an amendment to the Registration Statement, the
Agents will resume the solicitation of offers to purchase Notes
hereunder. Notwithstanding any other provision of this Section 4(d),
until the distribution of any Notes any Agent may own as principal has
been completed or in the event such Agent, in the opinion of its
counsel, is otherwise required to deliver a prospectus in respect of a
transaction in the Notes, if any event described in this Section 4(d)
occurs the Company will, at its own expense, promptly prepare and file
with the Commission an amendment or supplement, satisfactory in all
respects to such Agent; that will correct such statement or omission
<PAGE> 12
12
or effect such compliance, will supply such amended or supplemented
Prospectus to such Agent in such quantities as such Agent may
reasonably request and shall furnish to such Agent pursuant to
Sections 4(e), 4(i), 4(j) and 4(k) such documents, certificates,
opinions and letters as it may request in connection with the
preparation and filing of such amendment or supplement.
(e) To furnish to the Agents during the term of this Agreement
such relevant documents and certificates of officers of the Company
relating to the business, operations and affairs of the Company, the
Registration Statement, the Basic Prospectus, any amendments or
supplements thereto, the Indentures, the Notes, this Agreement, the
Administrative Procedures, any applicable Terms Agreement and the
performance by the Company of its obligations hereunder or thereunder
as the Agents may from time to time reasonably request and shall notify
the Agents promptly in writing of any downgrading, or on its receipt of
any notice of (i) any intended or potential downgrading or (ii) any
review or possible change that does not indicate an improvement in the
rating accorded any of the securities of, or guaranteed by, the Company
by any "nationally recognized statistical rating organization," as such
term is defined for purposes of Rule 436(g)(2) under the Securities
Act.
(f) To make generally available to its security holders and to
such Agent as soon as practicable but not later than 90 days after the
close of the period covered thereby earnings statements which shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule
158 of the Commission promulgated thereunder covering periods of at
least 12 months beginning in each case with the first day of the fiscal
quarter of the Company occurring after the "effective date" (as defined
in Rule 158) of the Registration Statement with respect to each sale of
Notes.
(g) So long as any Notes are outstanding, to furnish to such
Agent copies of all reports or other communications (financial or
other) furnished to holders of the Notes and copies of all annual
reports, quarterly reports and current reports filed with the
Commission on Forms 10-K, 10-Q and 8-K, or such other similar forms as
may be designated by the Commission, and all material reports or other
communications (financial or other) furnished to or filed with any
national securities exchange on which any class of securities of the
Company is listed.
(h) That, from the date of any applicable Terms Agreement with
such Agent or other agreement by such Agent to purchase Notes as
principal with a maturity of one year or longer and continuing to and
including the business day following the related Time of Delivery, not
to offer, sell, contract to sell or otherwise dispose of any debt
securities of or guaranteed by the Company which are denominated in the
same currency as such Notes and with a maturity of one year or longer,
without the prior written consent of such Agent.
<PAGE> 13
13
(i) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an amendment
or supplement providing solely for a change in the interest rates,
redemption provisions, amortization schedules or maturities offered on
the Notes or for a change the Agents deem to be immaterial) and each
time the Company sells Notes to such Agent as principal pursuant to a
Terms Agreement or other agreement and such Terms Agreement or other
agreement specified the delivery of an opinion under this Section 4(i)
as a condition to the purchase of Notes pursuant to such Terms
Agreement or other agreement, the Company shall furnish or cause to be
furnished forthwith to such Agent a written opinion of Thompson Hine &
Flory P.L.L., and/or the General Counsel or any Senior Managing Counsel
to the Company, dated the date of such amendment or supplement, or the
related Time of Delivery relating to such sale, as the case may be, in
form satisfactory to such Agent, of the same tenor as the opinion
referred to in Section 6(b) hereof but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented
to the date of such opinion, or, in lieu of such opinion, counsel last
furnishing such an opinion, may furnish to the Agents a letter to the
effect that such Agent may rely on the opinion of such counsel which
was last furnished to such Agent to the same extent as though it were
dated the date of such letter (except that the statements in such last
opinion shall be deemed to relate to the Registration Statement and the
Prospectus as amended or supplemented to date of delivery of such
letter).
(j) That each time the Registration Statement or the
Prospectus shall be amended or supplemented to include or incorporate
amended or supplemented financial information and each time the Company
sells Notes to such Agent as principal pursuant to a Terms Agreement or
other agreement and such Terms Agreement or other agreement specifies
the delivery of a letter under this Section 4(j) as a condition to the
purchase of Notes pursuant to such Terms Agreement or other agreement,
the Company shall cause the independent certified public accountants
who have certified the financial statements of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement forthwith to furnish such Agent a letter, dated the date of
such amendment or supplement or the related Time of Delivery relating
to such sale, as the case may be, of the same tenor as the letter
referred to in Section 6(d) hereof but modified to relate to the
Registration Statement and the Prospectus as amended or supplemented to
the date of such letter with such changes as may be necessary to
reflect such amended or supplemented financial information included or
incorporated by reference in the Registration Statement or the
Prospectus as amended or supplemented; provided, however, that, with
respect to any financial information or other matter, such letter may
reconfirm as true and correct at such date, as though made at and as of
such date, rather than repeat, statements with respect to such
financial information or other matter made in the letter referred to in
Section 6(d) hereof which was last furnished to such Agent.
<PAGE> 14
14
(k) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an amendment
or supplement providing solely for a change in the interest rates,
redemption provisions, amortization schedules or maturities offered on
the Notes or for a change the Agents deem to be immaterial), and each
time the Company sells Notes to such Agent as principal and the
applicable Terms Agreement or other agreement specifies the delivery of
a certificate under this Section 4(k) as a condition to the purchase of
Notes pursuant to such Terms Agreement or other agreement, the Company
shall furnish or cause to be furnished forthwith to such Agent a
certificate signed by an executive officer of the Company, dated the
date of such amendment or supplement or the related Time of Delivery
relating to such sale, as the case may be, of the same tenor as the
certificates referred to in Section 6(e) but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented
to the date of delivery of such certificate or to the effect that the
statements contained in the certificate referred to in Section 6(e)
hereof which was last furnished to such Agent are true and correct at
such date as though made at and as of such date (except that such
statements shall be deemed to relate to the Registration Statement and
the Prospectus as amended or supplemented to such date).
5. COSTS AND EXPENSES. The Company covenants and agrees with
each Agent that the Company will, whether or not any sale of Notes is
consummated, pay all costs and expenses incident to the performance of its
obligations hereunder and under any applicable Terms Agreement, including
without limiting the generality of the foregoing, all costs and expenses: (i)
incident to the preparation, issuance, execution, authentication and delivery of
the Notes, including any expenses of the Trustee; (ii) incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement, the Prospectus and any preliminary prospectus (including in each case
all exhibits, amendments and supplements thereto); (iii) incurred in connection
with the registration or qualification and determination of eligibility for
investment of the Notes under the laws of such jurisdictions as the Agents (or
in connection with any Terms Agreement, the applicable Agent) may designate
(including fees of counsel for the Agents (or such Agent) and their
disbursements); (iv) in connection with the listing of the Notes on any stock
exchange; (v) related to any filing with the National Association of Securities
Dealers, Inc.; (vi) in connection with the printing (including word processing
and duplication costs) and delivery of this Agreement, the Indenture, any Blue
Sky Memoranda and any Legal Investment Survey and the furnishing to the Agents
and dealers of copies of the Registration Statement and the Prospectus,
including mailing and shipping, as herein provided; (vii) payable to rating
agencies in connection with the rating of the Notes; (viii) the reasonable fees
and disbursements of counsel for the Agents incurred in connection with the
offering and sale of the Notes, including any opinions to be rendered by such
counsel hereunder; and (ix) any advertising and out-of-pocket expenses incurred
by the Agents.
6. CONDITIONS. The obligation of any Agent, as agent of the
Company, at any time ("Solicitation Time") to solicit offers to purchase the
Notes, the obligation of any Agent to purchase Notes as principal pursuant to
any Terms Agreement or otherwise, and the
<PAGE> 15
15
obligation of any other purchaser to purchase Notes shall in each case be
subject (1) to the condition that all representations and warranties of the
Company herein and all statements of officers of the Company made in any
certificate furnished pursuant to the provisions hereof are accurate (i) in the
case of an Agent's obligation to solicit offers to purchase Notes, at and as of
such Solicitation Time and (ii) in the case of any Agent's or any other
purchaser's obligation to purchase Notes, at and as of the time the Company
accepts the offer to purchase such Notes and, as the case may be, at and as of
the related Time of Delivery or time of purchase; (2) to the condition that at
or prior to such Solicitation Time, time of acceptance, Time of Delivery or
time of purchase, as the case may be, the Company shall have complied with all
its agreements and all conditions on its part to be performed or satisfied
hereunder; and (3) to the following additional conditions when and as
specified:
(a) Prior to such Solicitation Time or corresponding Time of
Delivery or time of purchase, as the case may be:
(i) the Prospectus as amended or supplemented
(including, if applicable, the Pricing Supplement) with
respect to such Notes shall have been filed with the
Commission pursuant to Rule 424(b) under the Securities Act
within the applicable time period prescribed for such filing
by the rules and regulations under the Securities Act; no stop
order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the
Commission;
(ii) there shall not have occurred any downgrading,
nor shall any notice have been given of (i) any intended or
potential downgrading or (ii) any review or possible change
that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company by any
"nationally recognized statistical rating organization", as
that term is defined by the Commission for purposes of Rule
436(g)(2) under the Securities Act;
(iii) there shall not have occurred any change or any
development in or affecting particularly the business or
properties of the Company or its subsidiaries which, in the
judgment of the applicable Agent, materially impairs the
investment quality of the Notes; and
(iv) (A) trading generally shall not have been
suspended on or by, as the case may be, any of the New York
Stock Exchange or the American Stock Exchange, minimum or
maximum prices for trading shall not have been fixed, or
maximum ranges for prices for securities shall not have been
required, on the New York Stock Exchange or the American Stock
Exchange, by such Exchange or by order of the Commission or
any other governmental authority having jurisdiction; (B)
trading in any securities of the Company shall not have been
suspended by the Commission or a national securities exchange
or in any over-
<PAGE> 16
16
the-counter market; (C) a general moratorium on commercial
banking activities in New York shall not have been declared
by either Federal or New York State authorities; or (D) there
shall not have occurred any outbreak or escalation of
hostilities in which the United States is involved, a
declaration of war by Congress, any other substantial
national or international calamity or any other event or
occurrence of a similar character if, in the judgment of such
Agent or Agents or of such other purchaser, the effect of any
such outbreak, escalation, declaration, calamity or other
event or occurrence makes it impracticable or inadvisable to
market the Notes on the terms and in the manner contemplated
in the Prospectus as amended or supplemented at the
Solicitation Time or at the time such offer to purchase was
made. Promptly after the determination by any such Agent or
other purchaser that it is impractical or inadvisable to
market the Notes, such Agent or other purchaser shall notify
the Company of such determination in writing; but the
omission so to notify the Company shall not act to modify the
rights of the Agent or other purchaser under this Section
6(a)(iv)(A).
(b) On the Commencement Date, and in the case of a purchase of
Notes by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, the General Counsel
or Senior Managing Counsel to the Company and/or Thompson Hine & Flory
P.L.L., Counsel to the Company, as indicated in the applicable
Prospectus Supplement (it being understood that any opinion with
respect to Key Bank of New York, Key Bank of Washington, Key Bank of
Oregon, Key Bank of Maine, Key Bank of Idaho, Key Bank of Utah, Key
Bank of Wyoming, Key Bank of Alaska or Key Bank of Colorado may be
delivered by the General Counsel or Senior Managing Counsel to the
Company) shall have furnished to the relevant Agent or Agents their
written opinion, dated the Commencement Date or Time of Delivery, as
the case may be, in form and substance satisfactory to such Agent or
Agents, to the effect that:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of Ohio
and is duly registered as a bank holding company under the
Bank Holding Company Act of 1956, as amended; each of Key Bank
National Association and Key Bank USA, National Association
(the "National Banks") is a duly organized and validly
existing national banking association under the laws of the
United States and continues to hold a valid certificate to do
business as such; each of Key Bank of New York, Key Bank of
Washington, Key Bank of Oregon, Key Bank of Maine, Key Bank
of Idaho, Key Bank of Utah, Key Bank of Wyoming, Key Bank of
Alaska and Key Bank of Colorado (the "State Banks") is a duly
organized and validly existing state chartered banking
association under the laws of the States of New York,
Washington, Oregon, Maine, Idaho, Utah, Wyoming, Alaska and
<PAGE> 17
17
Colorado, respectively, and each continues to hold a valid
certificate to do business as such; each of the Company, the
National Banks and the State Banks has full corporate power
and authority to conduct its business as described in the
Registration Statement and Prospectus and is duly qualified to
do business in each jurisdiction in which it owns or leases
real property, except where the failure to be so qualified,
considering all such cases in the aggregate, does not involve
a material risk to the business, properties, financial
position or results of operations of the Company and its
subsidiaries taken as a whole; and all of the outstanding
shares of capital stock of each of the National Banks and the
State Banks have been duly authorized and validly issued, are
fully paid and non-assessable (exceptions to be specified) and
(except as otherwise stated in the Registration Statement) are
owned beneficially by the Company subject to no security
interest, other encumbrance or adverse claim.
(ii) This Agreement and any applicable Terms
Agreement have been duly authorized, executed and delivered by
the Company.
(iii) The Notes conform in all material respects to
the description thereof contained or incorporated by reference
in the Prospectus and such description conforms in all
material respects to the rights set forth in the instruments
defining the same.
(iv) The Notes have been duly authorized and, when
executed, authenticated and delivered in accordance with the
terms of the applicable Indenture and issued to and paid for
by any purchaser of Notes sold through an Agent as agent or
any Agent as principal pursuant to any Terms Agreement or
other agreement, will be entitled to the benefits of such
applicable Indenture and will constitute valid and legally
binding obligations of the Company enforceable in accordance
with their terms subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other similar laws of general
applicability relating to or affecting creditors' rights and
to general equity principles.
(v) The Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and
legally binding instrument of the Company enforceable in
accordance with its terms subject, as to enforcement,
to bankruptcy, insolvency, reorganization and other similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the
Indenture has been duly qualified under the Trust Indenture
Act.
(vi) The issue and sale of the Notes and the
performance by the Company of its obligations under the Notes,
the Indenture, this Agreement and any applicable Terms
Agreement or other agreement pursuant to which an
<PAGE> 18
18
Agent purchases Notes as principal and the consummation of
the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of
the terms and provisions of, or constitute a default under,
any statute, rule or regulation, any agreement or instrument
known to such counsel to which the Company is a party or by
which it is bound, the Company's Articles of Incorporation or
Regulations, or any order known to such counsel of any court
or governmental agency or body having jurisdiction over the
Company.
(vii) No consent, approval, authorization, order,
registration or qualification of or filing with any court or
governmental agency or body is required for the issue and sale
of the Notes or the consummation of the other transactions
contemplated by this Agreement, any applicable Terms Agreement
or other agreement pursuant to which an Agent purchases Notes
as principal, or the Indenture, except such consents,
approvals, authorizations, registrations or qualifications as
have been obtained under the Securities Act and the Trust
Indenture Act and as may be required under state securities or
Blue Sky laws in connection with offers and sales of the
Notes from the Company and with purchases of Notes.
(viii) The Registration Statement has become
effective under the Securities Act; any required amendment or
supplement to the Prospectus has been filed as required by
Section 4(a) hereof; and to the best knowledge of such counsel
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose
has been instituted or threatened by the Commission.
(ix) Such counsel is of the opinion ascribed to it in
the Prospectus under the caption "United States Tax
Considerations", if any.
(x) Such counsel (A) is of the opinion that the
Registration Statement and the Prospectus each as amended or
supplemented on the Commencement Date or the applicable Time
of Delivery (except for the financial statements and other
financial and statistical data included therein or omitted
therefrom and the Statement of Eligibility (Form T-1) under
the Trust Indenture Act of the Trustee as to which such
counsel need express no opinion) complied as to form in all
material respects with the requirements of the Securities Act
and the Exchange Act and the respective rules thereunder; (B)
has no reason to believe that (except for the financial
statements or other financial and statistical data included
therein or omitted therefrom and the Statement of Eligibility
(Form T- 1) under the Trust Indenture Act of the Trustee as
to which such counsel need express no belief) each part of
the Registration Statement, as amended (including the
documents incorporated by reference therein), filed with the
<PAGE> 19
19
Commission pursuant to the Securities Act relating to the
Notes, when such part became effective and, as of the date
such opinion is delivered, contained any untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading; (C) has no reason to believe that (except for
the financial statements and other financial and statistical
data included therein or omitted therefrom and the Statement
of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee as to which such counsel need express no belief) the
Prospectus, as amended or supplemented, if applicable, as of
the date such opinion is delivered contains any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; and (D) does not know of any amendment to the
Registration Statement required to be filed which is not filed
as required; provided that in the case of an opinion delivered
on the Commencement Date or pursuant to Section 4(i) (other
than in connection with a Terms Agreement), the opinion and
belief set forth in clauses (A) and (C) above shall be deemed
not to cover information concerning an offering of particular
Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
Such opinion or opinions shall be to such further effect with
respect to other legal matters relating to this Agreement, and the sale
of the Notes, pursuant to this Agreement as counsel for the Agents may
reasonably request. Such opinion or opinions shall be limited to New
York, Ohio, Washington and federal law and, if applicable, the law of
the state of incorporation of any other Significant Subsidiary. In
giving such opinion, such counsel may rely, as to all matters governed
by the laws of jurisdictions in which such counsel is not qualified and
the federal law of the United States, upon opinions of other counsel,
who shall be counsel satisfactory to counsel for the Agents, in which
case the opinion shall state that they believe you and they are
entitled to so rely. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company, the National
Banks and the State Banks and the Significant Subsidiaries and
certificates of public officials.
In rendering their opinion, such counsel may rely upon the
opinion of Shearman & Sterling referred to below as to any matters
governed by New York law covered therein.
(c) On the Commencement Date, and in the case of a purchase of
Notes by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, Shearman & Sterling,
counsel to the Agents, shall have furnished to the relevant Agent or
Agents such opinion or opinions, dated the Commencement Date or
<PAGE> 20
20
Time of Delivery, as the case may be, to the effect that the opinion
delivered pursuant to Section 6(b) appears on its face to be
appropriately responsive to the requirements of this Agreement and
with respect to the incorporation of the Company, the validity of the
Indenture, the securities, the Registration Statement, the Prospectus
as amended or supplemented and other related matters as such Agent or
Agents may reasonably request, and in each case such counsel shall
have received such papers and information as they may reasonably
request to enable them to pass upon such matters. In rendering their
opinion, such counsel may rely upon the opinion rendered on behalf of
the Company referred to above as to all matters of Ohio law.
(d) On the Commencement Date, and in the case of a purchase of
Notes by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, the Company's
independent certified public accountants who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement and Prospectus,
as then amended or supplemented, shall have furnished to the relevant
Agent or Agents a letter, dated the Commencement Date or Time of
Delivery, as the case may be to the effect set forth in Annex I hereto.
(e) On the Commencement Date, and in the case of a purchase of
Notes by an Agent as principal pursuant to a Terms Agreement or
otherwise, if called for by the applicable Terms Agreement or other
agreement, at the corresponding Time of Delivery, the relevant Agent or
Agents shall have received from the Company a certificate or
certificates signed by the Chairman of the Board, the President or an
Executive Vice President, and by the principal financial or accounting
officer, dated the Commencement Date or Time of Delivery, as the case
may be, to the effect that, to the best of their knowledge based upon
reasonable investigation (1) the representations and warranties of the
Company contained herein are true and correct on and as of the
Commencement Date or Time of Delivery, as the case may be, as if made
on and as of such date, and the Company has complied with all
agreements and all conditions on its part to be performed or satisfied
hereunder or under the applicable Terms Agreement or other agreement at
or prior to the Commencement Date or Time of Delivery, as the case may
be, and (2) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceeding for that
purpose has been instituted or is threatened by the Commission.
(f) On the Commencement Date and at each Time of Delivery, the
Company shall have furnished to the relevant Agent or Agents such
further certificates and documents as such Agent or Agents may
reasonably request. All such opinions, certificates, letters and other
documents will be in compliance with the provisions hereof only if they
are satisfactory in form and substance to the relevant Agent or Agents.
The Company will furnish the relevant Agent or Agents with such
conformed
<PAGE> 21
21
copies of such opinions, certificates, letters and other
documents as the relevant Agent or Agents shall reasonably request.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will
indemnify and hold harmless each Agent against any losses, claims, damages or
liabilities, joint or several, to which such Agent may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
part of the Registration Statement when such part became effective, any
preliminary prospectus, the Prospectus or any amendment or supplement thereto,
or any other prospectus with respect to the Notes, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Agent for any legal or other expenses reasonably
incurred by it in connection with investigating or defending against such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that (i) the Company shall not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by you, or by any Agent through you, specifically for
use therein and (ii) such indemnity with respect to any Preliminary Prospectus
shall not inure to the benefit of any Agent (or any person controlling such
Agent) to the extent that any such loss, claim, damage or liability of such
Agent results from the fact that such Agent sold Notes to a person as to whom it
shall be established that there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or of the Prospectus as then amended or supplemented
(excluding documents incorporated by reference) in any case where such delivery
is required by the Securities Act if the Company has previously furnished copies
thereof in sufficient quantity to such Agent and the loss, claim, damage or
liability of such Agent results from an untrue statement or omission of a
material fact contained in the Preliminary Prospectus which was corrected in the
Prospectus (excluding documents incorporated by reference) or in the Prospectus
as then amended or supplemented (excluding documents incorporated by reference).
(b) Each Agent will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in any part of the Registration Statement when such part became
effective, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, or any other prospectus relating to the Notes, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
<PAGE> 22
22
omission was made therein in reliance upon and in conformity with written
information furnished to the Company by you, or by such Agent through you,
specifically for use therein, and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending against any such loss, claim, damage, liability or
action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party; provided,
however, that, if the defendants in any such action (including any impleaded
parties) include both the indemnified party and the indemnifying party and
representations of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them, the indemnified party
or parties shall have the right to select separate counsel to participate in the
defense of such action on behalf of such indemnified party or parties (and the
reasonable fees and expenses of one such separate counsel shall be paid by the
indemnifying party). No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities,
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Agents on the other from the
offering of the Notes or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the Agents
on the other in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Agents on the other shall be deemed to be in the same
proportion as the total proceeds from the offering of the Notes (before
deducting expenses) received by the Company bear to the total compensation or
profit (before deducting expenses) received or
<PAGE> 23
23
realized by the Agents from the purchase and resale, or underwriting, of the
Notes. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Agents and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Agents agree that it would not
be just and equitable if contributions pursuant to this subsection (d) were to
be determined by pro rata allocation (even if the Agents were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the first sentence of
this subsection (d). The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
against any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Agent shall be
required to contribute any amount in excess of the amount by which the total
price at which the Notes underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such Agent has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Agents' obligations in this subsection (d) to
contribute shall be several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 7 shall
be in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Agent within the meaning of the Securities Act; and the obligations of the
Agents under this Section 7 shall be in addition to any liability that the
respective Agents may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company (including any person who, with his
consent, is named in the Registration Statement as about to become a director of
the Company), to each officer of the Company who has signed the Registration
Statement and to each person, if any, who controls the Company within the
meaning of the Securities Act.
8. TERMINATION. (a) This Agreement may be terminated at any
time (i) by the Company with respect to any or all of the Agents or (ii) by any
Agent with respect to itself only, in each case upon the giving of written
notice of such termination to each other party hereto. Any Terms Agreement shall
be subject to termination in the discretion of the Agent or Agents that are
parties thereto by notice given to the Company prior to the payment for any Note
to be purchased thereunder, if at or prior to such time any of the conditions
specified in Section 6(a) hereof shall not have been satisfied. The termination
of this Agreement shall not require termination of any agreement by an Agent to
purchase Notes as principal (whether pursuant to a Terms Agreement or otherwise)
and the termination of such an agreement shall not require termination of this
Agreement. In the event this Agreement is terminated with
<PAGE> 24
24
respect to any Agent, (x) this Agreement shall remain in full force and effect
with respect to any Agent as to which such termination has not occurred, (y)
this Agreement shall remain in full force and effect with respect to the rights
and obligations of any party which have previously accrued or which relate to
Notes which are already issued, agreed to be issued or the subject of a pending
offer at the time of such termination and (z) in any event, the provisions of
the fourth paragraph of Section 2(a), Section 2(c), the last sentence of
Section 4(d) and Sections 4(f), 4(g), 5, 7, 9, 10, 12 and 15 shall survive;
provided that if at the time of termination an offer to purchase Notes has been
accepted by the Company but the time of delivery to the purchaser or its agent
of such Notes has not yet occurred, the provisions of Sections 2(b), 2(d), 4(a)
through 4(e), 4(h) through 4(k) and 6 shall also survive. If any Terms
Agreement is terminated, the provisions of the last sentence of Section 4(d)
and Sections 2(b), 2(d), 4(a), 4(b), 4(e), 4(g) through 4(k), 5, 6, 7, 9, 10,
12 and 15 (which shall have been incorporated by reference in such Terms
Agreement) shall survive.
(b) If this Agreement or any Terms Agreement shall be
terminated by an Agent or Agents because of any failure or refusal on the part
of the Company to comply with the terms or to fulfill any of the conditions of
this Agreement or any Terms Agreement or if for any reason the Company shall be
unable to perform its obligations under this Agreement or any Terms Agreement or
any condition of any Agent's obligations cannot be fulfilled, the Company agrees
to reimburse each Agent or such Agents as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including the
fees and expenses of their counsel) reasonably incurred by such Agent or Agents
in connection with this Agreement or the offering of Notes.
9. POSITION OF THE AGENTS. Each Agent, in soliciting offers to
purchase Notes from the Company and in performing the other obligations of such
Agent hereunder (other than in respect of any purchase by an Agent as principal,
pursuant to a Terms Agreement or otherwise), is acting solely as agent for the
Company and not as principal and does not assume any obligation towards or
relationship of agency or trust with any purchaser of Notes. Each Agent will
make reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes from the Company was solicited by such
Agent and has been accepted by the Company, but such Agent shall not have any
liability to the Company in the event such purchase is not consummated for any
reason. If the Company shall default on its obligation to deliver Notes to a
purchaser whose offer it has accepted, the Company shall (i) hold the relevant
Agent harmless against any loss, claim, damage or liability arising from or as
a result of such default by the Company and (ii) notwithstanding such default,
pay to the Agent that solicited such offer any commission to which it would be
entitled in connection with such sale.
10. REPRESENTATIONS AND AGREEMENTS TO SURVIVE. The respective
indemnities and contribution agreements, representations, warranties and
agreements of the Company herein or certificates of its officers and the Agents
set forth in or made pursuant to this Agreement or any agreement by an Agent to
purchase Notes as principal shall remain in full
<PAGE> 25
25
force and effect regardless of any termination of this Agreement or any such
agreement, any investigation made by or on behalf of any Agent or any
controlling person of any Agent, or the Company, or any officer or director or
any controlling person of the Company, and shall survive each delivery of and
payment for any of the Notes.
11. NOTICES. Except as otherwise specifically provided herein
or in the Administrative Procedures, all statements, requests, notices and
advices hereunder shall be in writing, and effective only on receipt, and will
be delivered by hand, by mail (postage prepaid), by telegram (charges prepaid)
or by telecopier. Communications to the Agents will be sent, in the case of
Salomon Brothers Inc, Seven World Trade Center, New York, New York 10048,
Attention: Medium Term Note Department (Facsimile Number: 212-783- 2274); in the
case of Chase Securities Inc., 270 Park Avenue, New York, New York 10017,
Attention: Rick Zellweger (Facsimilie Number: 212-834-6534); in the case of
Citicorp Securities, Inc., 399 Park Avenue, New York, New York 10043, Attention:
J. Darrell Thomas (Facsimile Number: 212-291-3910); in the case of CS First
Boston Corporation, to Park Avenue Plaza, 55 East 52nd Street, New York, New
York 10005, Attention: Robert W. Mitchell, Short and Medium-Term Finance
Department (Facsimile Number: 212-318-1498), in the case of Goldman, Sachs &
Co., to 85 Broad Street, New York, New York 10004, Attention: Credit Department
(Credit Control-Medium Term Notes) (Facsimile Number: 212-357-8680); in the case
of J.P. Morgan Securities Inc., to 60 Wall Street, 3rd Floor, New York, New York
10260, Attention: Medium Term Note Desk (Facsimile Number: 212-648- 5909); and,
if sent to the Company, to it at 127 Public Square, Cleveland, Ohio 44114,
ATTENTION: Secretary and General Counsel (Telephone Number: (216) 689-3196;
Telecopier Number: (216) 689-4121) with a COPY TO: the Senior Managing Counsel
- -- Securities.
12. SUCCESSORS. This Agreement and any Terms Agreement shall
be binding upon, and inure solely to the benefit of, each Agent and the Company,
and their respective successors and the officers, directors and controlling
persons referred to in Section 7 and (to the extent expressly provided in
Section 6) the purchasers of Notes, and no other person shall acquire or have
any right or obligation under or by virtue of this Agreement or any Terms
Agreement.
13. AMENDMENTS. This Agreement may be amended or supplemented
if, but only if, such amendment or supplement is in writing and is signed by the
Company and each Agent; provided that the Company may from time to time, on 7
days prior written notice to the Agents but without the consent of any Agent,
amend this Agreement to add as a party hereto one or more additional firms
registered under the Exchange Act, whereupon each such firm shall become an
Agent hereunder on the same terms and conditions as the other Agents that are
parties hereto. The Agents shall sign any amendment or supplement giving effect
to the addition of any such firm as an Agent under this Agreement.
14. BUSINESS DAY. Time shall be of the essence in this
Agreement and any Terms Agreement. As used herein, the term "business day" shall
mean any day which is not a
<PAGE> 26
26
Saturday or Sunday or legal holiday or a day on which banks in New York City
are generally required or authorized by law or executive order to close.
15. APPLICABLE LAW. This Agreement and any Terms Agreement
shall be governed by, and construed in accordance with, the laws of the State of
New York, without giving effect to the conflict of laws provisions thereof.
16. COUNTERPARTS. This Agreement and any Terms Agreement may
be signed in counterparts, each of which shall be an original, and all of which
together shall constitute one and the same instrument.
17. HEADINGS. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
<PAGE> 27
27
If the foregoing is in accordance with your understanding,
please sign and return to us five counter-parts hereof, whereupon this letter
and the acceptance by each of you thereof shall constitute a binding agreement
between the Company and each of you in accordance with its terms.
Very truly yours,
KeyCorp
By:____________________
Accepted in New York, New York, as of the date first above written:
Salomon Brothers Inc
By:____________________________
Name:
Title:
Chase Securities Inc.
By:____________________________
Name:
Title:
Citicorp Securities, Inc.
By:____________________________
Name:
Title:
<PAGE> 28
28
CS First Boston Corporation
By:____________________________
Name:
Title:
_______________________________
(Goldman, Sachs & Co.)
J.P. Morgan Securities Inc.
By:____________________________
Name:
Title:
<PAGE> 29
ANNEX I
Pursuant to Section 6(d) of the Distribution Agreement, the
independent auditors shall furnish letters to the Agents to the effect that:
(1) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the Securities Act and the
applicable published Securities Act Regulations.
(2) In their opinion, the consolidated financial statements and
any supplemental financial information or schedules audited by them and included
or incorporated by reference in the Registration Statement or Prospectus comply
as to form in all material respects with the applicable accounting requirements
of the Securities Act or the Exchange Act, as applicable, and the published
rules and regulations thereunder.
(3) On the basis of procedures referred to in such letter,
including a reading of the minute books of the Company since the end of the most
recent fiscal year with respect to which an audit report has been issued,
performing the procedures specified by the American Institute of Certified
Public Accountants for a review of interim financial information as described in
SAS No. 71, Interim Financial Information, on the unaudited consolidated interim
financial statements of the Company included or incorporated by reference in the
Registration Statement and Prospectus and reading the internal unaudited
consolidated interim financial data, if any, for the period from the date of the
latest balance sheet included or incorporated by reference in the Registration
Statement and Prospectus to the date of the latest available internal interim
financial data (which internal unaudited interim financial data, if any, will be
attached to each such letter to the Underwriters); and making inquiries of
officials of the Company responsible for financial and accounting matters
(including inquiries with respect to whether the unaudited consolidated
financial statements comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act and inquiries of certain
officials of the Company who have responsibility for financial and accounting
matters whether the internal unaudited consolidated interim financial statements
are stated on a basis substantially consistent with that of the audited
consolidated financial statements incorporated by reference in the Registration
Statement), nothing caused them to believe that:
(A) (i) any material modifications should be made to the unaudited
consolidated financial statements included in any Quarterly Reports on
Form 10-Q which are incorporated by reference in the Registration
Statement or Prospectus (the "10-Q Financials") for them to be in
conformity with generally accepted accounting principles applicable to
such financial statements and (ii) the 10-Q Financials do not comply as to
form in all material respects with the applicable requirements of the
Exchange Act as it applies to Form 10-Q and the related published rules
and regulations; or
<PAGE> 30
2
(B) the internal unaudited consolidated interim financial
statements of the Company are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
that of the audited consolidated financial statements incorporated by
reference in the Registration Statement; or
(C) at the date of the latest available internal unaudited
consolidated interim financial statements of the Company, there was any
increase in consolidated long-term debt or any decrease in consolidated
shareholders' equity as compared with amounts shown in the latest balance
sheet included or incorporated by reference in the Prospectus except in
all instances for decreases that the Prospectus discloses have occurred or
may occur or as may be set forth in such letter; or
(D) for the period from the date of the latest balance sheet
included or incorporated by reference in the Prospectus to the date of the
latest available internal financial statements of the Company, there was
any decrease, as compared with the corresponding period of the previous
year, in consolidated net interest income, consolidated net interest
income after provision for possible loan losses, consolidated income
before taxes or in the total or per common share amounts of consolidated
net income, except in all cases for changes or decreases that the
Prospectus discloses have occurred or may occur or as may be set forth in
such letter;
(E) as of a specified date not more than five days prior to the
date of delivery of such letter to the Agent(s), there was any increase in
consolidated long-term debt or any decrease in consolidated shareholders'
equity as compared with the [amount shown in the latest balance sheet
included or incorporated by reference in the Prospectus/amount shown in
the latest internal unaudited consolidated interim financial statements],
except for any decrease that the Registration Statement discloses has
occurred or may occur.
(4) In addition to their examination referred to in their reports
incorporated by reference in the Registration Statement and Prospectus and the
procedures referred to in (3) above, (a) they have carried out certain other
procedures, not constituting an audit, with respect to certain of the dollar
amounts, percentages and other financial information (in each case to the extent
that such dollar amounts, percentages and other financial information, either
directly or by analysis or computation, are derived from the general accounting
records of the Company and its subsidiaries) which are included or incorporated
by reference in the Prospectus (other than those appearing in the audited
financial statements included therein) and appear in the Prospectus or
incorporated documents, as agreed to by officers of the Company and the
Representative(s), and have found such dollar amounts, percentages and financial
information to be in agreement with the general accounting records of the
Company and its subsidiaries and (b) if any pro forma financial information is
included or incorporated by reference in the Registration Statement and
Prospectus, they have carried out other procedures,
<PAGE> 31
3
not constituting an audit, with respect to such pro forma financial information
and indicated the results thereof, if requested by the Agent(s) and agreed to
by officers of the Company.
<PAGE> 32
Exhibit A
KEYCORP
SENIOR MEDIUM-TERM NOTES, SERIES D
SUBORDINATED MEDIUM-TERM NOTES, SERIES C
TERMS AGREEMENT
___________, 199_
KeyCorp
127 Public Square
Cleveland, Ohio 44114
Attention: ______________
Re: Distribution Agreement dated August __, 1996 (the "Distribution Agreement")
The undersigned agrees to purchase your Medium-Term Notes
having the following terms:
Title: ________________________
Specified Currency:_____________
Principal Amount:______________________
Original Issue Date:_____________
Settlement Date, Time and Place:_______________
Stated Maturity:_____________
Purchase _____% of Principal Amount, plus accrued interest,
if any, from Settlement Date
Price to _____% of Principal Amount, plus accrued interest,
if any, from Settlement Date
Redemption:
<PAGE> 33
2
Initial Redemption Date (Dates): , commencing
Additional Redemption Dates:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Repayment Price:
Initial accrual period OID:
Original Yield to Maturity
[(FOR FIXED RATE NOTES)]
Interest Rate:________________
Applicability of modified payment upon acceleration:
If yes, state issue price:
Amortization schedule:
[(FOR FLOATING RATE NOTES)]*
Initial Interest Rate:_________________
Base Rate (CD, Commercial Paper, Federal Funds, LIBOR, Prime,
Treasury, CMT, 11th District Cost of Funds, ______ ):______
Index Maturity (30, 60, 90 days, 6 months, 1 year,
other):_________________
Interest Reset Period (daily, weekly, monthly, quarterly,
semiannually, annually):_________________
Spread:__________ points (+/-)
Spread Multiplier:_____%
Maximum Interest Rate:_____%
Minimum Interest Rate:_____%
Initial Interest Reset Date:___________
___________________
* See Prospectus Supplement dated ___________ for explanation of terms.
<PAGE> 34
3
Interest Reset Dates:___________
Interest Determination Dates:___________
Interest Payment Dates:____________
Calculation Agent:
Other terms of Securities:
Provisions relating to underwriter
default, if any:
The provisions of Sections 1, 2(b) and 2(d) and 4 through 7,
10, 11, 12 and 15 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
This Agreement is subject to termination in our absolute
discretion on the terms incorporated by reference herein. If this Agreement is
so terminated, the provisions set forth in the last sentence of Section 8 of the
Distribution Agreement shall survive for the purposes of this Agreement.
[THE CERTIFICATE REFERRED TO IN SECTION 4(K) OF THE
DISTRIBUTION AGREEMENT, THE OPINION REFERRED TO IN SECTION 4(I) OF THE
DISTRIBUTION AGREEMENT AND THE ACCOUNTANTS' LETTER REFERRED TO IN SECTION 4(J)
OF THE DISTRIBUTION AGREEMENT WILL BE REQUIRED.]
[AGENT]
By:_____________________
(Title)
Accepted:
KEYCORP
By:___________________________
(Title)
<PAGE> 35
Exhibit B
KEYCORP
SENIOR MEDIUM-TERM NOTES, SERIES D
SUBORDINATED MEDIUM-TERM NOTES, SERIES C
ADMINISTRATIVE PROCEDURES
The Senior Medium-Term Notes, Series D (the "Notes") and the
Subordinated Medium-Term Notes, Series C, are to be offered on a continuous
basis by KeyCorp (the "Company"). Each of Salomon Brothers Inc, Chase Securities
Inc., Citicorp Securities, Inc., CS First Boston Corporation, Goldman Sachs &
Co., J.P. Morgan Securities Inc. (each, an "Agent" and collectively, the
"Agents") has agreed to solicit offers to purchase the Notes. The Notes are
being sold pursuant to a Distribution Agreement dated August __, 1996 (the
"Agreement") between the Company and the Agents. In the Agreement, each Agent
has agreed to use reasonable efforts to solicit purchases of the Notes. Each
Agent, as principal, may purchase Notes for its own account and, if such Agent
so elects, the Company and such Agent will enter into a Terms Agreement, as
contemplated by the Agreement. The Company may also solicit offers to purchase
and may sell Notes directly on its own behalf to investors (other than
broker-dealers).
The Notes will be issued under an Indenture, dated as of June
10, 1994 (as supplemented or amended from time to time, the "Senior Indenture")
between the Company and Bankers Trust Company, as trustee (the "Senior
Trustee"), with respect to unsecured and unsubordinated Notes, or the Indenture,
dated as of June 10, 1994 (as supplemented or amended from time to time, the
"Subordinated Indenture"), between the Company and Bankers Trust Company, as
trustee (the "Subordinated Trustee"), with respect to unsecured and subordinated
Notes. The Senior Indenture and Subordinated Indenture are herein collectively
referred to as the "Indenture" and the Senior Trustee and Subordinated Trustee
are herein collectively referred to as the "Trustee." Wherever the terms
"Indenture" and "Trustee" are used with respect to a specific issuance of Notes
they shall mean the Senior Indenture and Senior Trustee, in the case of an
issuance of unsecured and unsubordinated Notes, and the Subordinated Indenture
and Subordinated Trustee, in the case of an issuance of unsecured and
subordinated Notes. Mellon Bank F.S.B., as agent for the Trustee, will be the
Paying Agent, Registrar and Authenticating Agent and Mellon Bank F.S.B. will be
the Calculation Agent for the Notes, and will perform the duties specified
herein. Notes will bear interest at a fixed rate (the "Fixed Rate Notes"), which
may be zero in the case of certain original issue discount notes (the "OID
Notes"), or at floating rates (the "Floating Rate Notes"). Fixed Rate Notes may
pay a level amount in respect of both interest and principal amortized over the
life of the Notes ("Amortizing Notes"). Each Note will be represented by either
a Global Security (as defined below) delivered to the Trustee, as agent for The
Depository Trust Company ("DTC"), and recorded in the book-entry system
maintained by DTC (a "Book-Entry Note") or a certificate delivered to the holder
thereof or a person designated by such holder (a
<PAGE> 36
2
"Certificated Note"). Except in limited circumstances, an owner of a Book-Entry
Note will not be entitled to receive a Certificated Note.
Unless otherwise indicated in the applicable Pricing
Supplement, the Notes will be denominated in U.S. dollars and payments of
principal of and any premium and interest on the Notes will be made in U.S.
dollars in the manner indicated in the Prospectus and the Prospectus Supplement.
Notes denominated in one or more currencies or currency units other than U.S.
Dollars are referred to herein as "Foreign Currency Notes". For special
provisions relating to Foreign Currency Notes, see the sections entitled
"Special Provisions Relating to Foreign Currency Notes" in the Prospectus
Supplement and "Foreign Currency Risks" in the Prospectus. Specific information
concerning the foreign currency or currency unit in which a particular Foreign
Currency Note is denominated, including historical exchange rates and a
description of the currency and any exchange controls, shall be contained in a
Pricing Supplement to the Prospectus Supplement reflecting the terms of such
Note.
The Company will advise each Agent in writing of those persons
representing the Company with whom such Agent is to communicate regarding offers
to purchase Securities and the related settlement details.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes
for eligibility in the book-entry system maintained by DTC, the Trustee will
perform the custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representation from the Company and the Trustee to DTC, dated as of the date
hereof (the "Letter of Representation"), and a Medium-Term Note Certificate
Agreement between the Trustee and DTC, dated as of April 18, 1989 and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: On any date of settlement (as defined under "Settlement"
below) for one or more Book-Entry Notes, the Company will
issue a single global security in fully registered form
without coupons (a "Global Security") representing up to U.S
$200,000,000 principal amount of all such Notes that have the
same Maturity Date, redemption or repayment provisions,
Interest Payment Dates, Original Issue Date, original issue
discount provisions (if any), and, in the case of Fixed Rate
Notes, Interest Rate, modified payment upon acceleration (if
any), amortization schedule (if any) or, in the case of
Floating Rate Notes, Initial Interest Rate, Interest Payment
Dates, Interest Payment Period, Calculation Agent, Base Rate,
Index Maturity, Interest Reset Period, Interest Reset Dates,
Spread or Spread Multiplier (if any), Minimum Interest Rate
(if any) and Maximum Interest Rate (if any) and, in each case,
any other relevant
<PAGE> 37
3
terms (collectively "Terms"). Each Global Security will be
dated and issued as of the date of its authentication by the
Trustee. Each Global Security will bear an "Interest Accrual
Date," which will be (i) with respect to an original Global
Security (or any portion thereof), its original issuance date
and (ii) with respect to any Global Security (or any portion
thereof) issued subsequently upon exchange of a Global
Security, or in lieu of a destroyed, lost or stolen Global
Security, the most recent Interest Payment Date to which
interest has been paid or duly provided for on the predecessor
Global Security or Securities (or if no such payment or
provision has been made, the original issuance date of the
predecessor Global Security), regardless of the date of
authentication of such subsequently issued Global Security.
Each Global Security will bear an "Interest Accrual Date,"
which will be (i) with respect to an original Global Security
(or any portion thereof), its original issuance date and (ii)
with respect to any Global Security (or any portion thereof)
issued subsequently upon exchange of a Global Security, or in
lieu of a destroyed, lost or stolen Global Security, the most
recent Interest Payment Date to which interest has been paid
or duly provided for on the predecessor Global Security or
Securities (or if no such payment or provision has been made,
the original issuance date of the predecessor Global
Security), regardless of the date of authentication of such
subsequently issued Global Security. Book-Entry Notes may
currently be denominated and payable only in U.S. dollars. No
Global Security will represent (i) both Fixed Rate and
Floating Rate Book-Entry Notes or (ii) any Certificated Note.
Identification The Company has arranged with the CUSIP Service Bureau of
Numbers: Standard & Poor's Corporation (the "CUSIP Service Bureau") for
the reservation of a series of approximately 900 CUSIP numbers
(including tranche numbers) for assignment to the Global
Securities representing the Book-Entry Notes. The Company has
obtained from the CUSIP Service Bureau a written list of such
series of reserved CUSIP numbers and has delivered to the
Trustee, Registrar and DTC the written list of 900 CUSIP
numbers of such series. The Company will assign CUSIP numbers
to Global Securities as described below under Settlement
Procedure "B". DTC will notify the CUSIP Service Bureau
periodically of the CUSIP numbers that the Company has
assigned to Global Securities. At any time when fewer than 100
of the reserved CUSIP numbers remain unassigned to Global
Securities, the Trustee shall so advise the Company and, if it
deems necessary, the Company will reserve additional CUSIP
numbers for assignment to Global Securities representing
Book-Entry Notes. Upon obtaining such additional CUSIP
<PAGE> 38
4
numbers, the Company shall deliver a list of such additional
CUSIP numbers to the Trustee, Registrar and DTC.
Registration: Each Global Security will be registered in the name of Cede &
Co., as nominee for DTC, on the security register maintained
under the Indenture. The beneficial owner of a Book-Entry Note
(or one or more indirect participants in DTC designated by
such owner) will designate one or more participants in DTC
with respect to such Note (the "Participants") to act as agent
or agents for such owner in connection with the book-entry
system maintained by DTC and DTC will record in book-entry
form, in accordance with instructions provided by such
Participants, a credit balance with respect to such beneficial
owner in such Note in the account of such Participants. The
ownership interest of such beneficial owner in such Note will
be recorded through the records of such Participants or
through the separate records of such Participants and one or
more indirect participants in DTC.
Transfers: Transfers of a Book-Entry Note will be accompanied by book
entries made by DTC and, in turn, by Participants (and in
certain cases, one or more indirect participants in DTC)
acting on behalf of beneficial transferors and transferees of
such Note.
Exchanges: The Registrar may deliver to DTC and the CUSIP Service Bureau
at any time a written notice of consolidation specifying (i)
the CUSIP numbers of two or more Outstanding Global Securities
that represent Book-Entry Notes having the same Terms and for
which interest has been paid to the same date, (ii) a date,
occurring at least thirty days after such written notice is
delivered and at least thirty days before the next Interest
Payment Date for such Book-Entry Notes, on which such Global
Securities shall be exchanged for a single replacement Global
Security and (iii) a new CUSIP number to be assigned to such
replacement Global Security. Upon receipt of such a notice,
DTC will send to its Participants (including the Trustee) a
written reorganization notice to the effect that such exchange
will occur on such date. Prior to the specified exchange date,
the Registrar will deliver to the CUSIP Service Bureau a
written notice setting forth such exchange date and the new
CUSIP number and stating that, as of such exchange date, the
CUSIP numbers of the Global Securities to be exchanged will no
longer be valid. On the specified exchange date, the Registrar
will exchange such Global Securities for a single Global
Security bearing the new CUSIP number and a new Interest
Accrual Date, and the CUSIP numbers of the exchanged Global
Securities will, in accordance with CUSIP Service Bureau
procedures, be cancelled and not immediately reassigned.
<PAGE> 39
5
Notwithstanding the foregoing, if the Global Securities to be
exchanged exceed $200,000,000 in aggregate principal amount,
one Global Security will be authenticated and issued to
represent each $200,000,000, principal amount of the exchanged
Global Security and an additional Global Security will be
authenticated and issued to represent any remaining principal
amount of such Global Securities (see "Denominations" below).
Maturities: Each Book-Entry Note will mature on a date nine months or more
from date of issue.
Notice of The Paying Agent will give notice to DTC prior to each
Redemption and Redemption Date or Repayment Date (as specified in the Note),
Repayment Dates: if any, at the time and in the manner set forth in the Letter
of Representation. Such notice shall be sent to DTC by a
secure means (E.G., legible telecopy, registered or certified
mail, overnight delivery) in a timely manner designed to
assure that such notice is in DTC's possession no later than
two business days before the Publication Date. The Trustee
shall forward such notice either in a separate secure
transmission for each CUSIP number or in a secure transmission
for multiple CUSIP numbers (if applicable) which includes a
manifest or list of each CUSIP number submitted in that
transmission. The Trustee shall verify the use of such means
and the timeliness of such notice. The Publication Date shall
not be less than 30 days nor more than 60 days prior to the
redemption date.
With respect to repayment of Notes at the option of the
holder, the Trustee shall send notice to DTC on the day which
is the earlier of 60 days prior to the purchase date or five
days prior to the commencement of the tender exercise period,
and such notice shall specify the CUSIP number of such issue,
the start date and end date of the tender exercise period, the
repayment price, and the purchase date. The Trustee shall send
such notice with respect to an issue of Notes with a "one time
only" repayment option when such option arises; in the case of
an issue of Notes that are repayable on a regular quarterly,
semi-annual, annual, or less frequent cycle, the Trustee shall
send such notice with respect to each repayment option as it
arises, or shall send such notice with respect to all
repayment options when the first such option arises; and, for
an issue of Notes that are repayable on a regular monthly
cycle, the Trustee shall send such notice with respect to the
first repayment option and annually thereafter; provided,
however, the Trustee shall in all cases promptly send notice
of any change in the issue's operational terms affecting the
repayment options (E.G., an upcoming mandatory tender), when
known. The Trustee recognizes that DTC will use its Repayment
<PAGE> 40
6
Option Procedures, a copy of which previously has been
furnished to the Trustee, to process tenders of the Notes. It
is understood that under the Repayment Option Procedures DTC
will receive daily instructions from its Participants to
tender Notes for purchase. On the purchase date, if after
paying DTC for tendered Notes the Trustee wishes to retire the
tendered Notes, it shall notify DTC to reduce the principal
amount of the issue of the Notes by the aggregate principal
amount of the tendered Notes and shall reduce the principal
amount of the Global Security evidencing the tendered Notes
accordingly.
Denominations: Book-Entry Notes will be issued in principal amounts of
$100,000 or an integral multiple of $1,000 in excess thereof.
Global Securities will be denominated in principal amounts not
in excess of $200,000,000. If one or more Book-Entry Notes
having an aggregate principal amount in excess of $200,000,000
would, but for the preceding sentence, be represented by a
single Global Security, then one Global Security will be
issued to represent each $200,000,000 principal amount of such
Book-Entry Note or Notes and an additional Global Security
will be issued to represent any remaining principal amount of
such Book-Entry Note or Notes. In such a case, each of the
Global Securities representing such Book-Entry Note or Notes
shall be assigned the same CUSIP number.
Interest: GENERAL. Interest on each Book-Entry Note will accrue from the
Interest Accrual Date of the Global Security representing such
Note. Unless otherwise specified therein, each payment of
interest on a Book-Entry Note will include interest accrued to
but excluding the Interest Payment Date. Interest payable at
the maturity or upon redemption or repayment of a Book-Entry
Note will be payable to the person to whom the principal of
such Note is payable. Standard & Poor's Corporation will use
the information received in the pending deposit message
described under Settlement Procedure "C" below in order to
include the amount of any interest payable and certain other
information regarding the related Global Security in the
appropriate weekly bond report published by Standard & Poor's
Corporation.
RECORD DATES. The Record Date with respect to any Interest
Payment Date shall be the date 15 calendar days immediately
preceding such Interest Payment Date.
FIXED RATE BOOK-ENTRY NOTES. Unless otherwise specified
pursuant to Settlement Procedure "A" below, interest payments
on Fixed Rate Book-Entry Notes, other than Amortizing Notes,
will be made semiannually on June 1 and December 1 of each
year, and at maturity or upon any
<PAGE> 41
7
earlier redemption or repayment and principal and interest
payments on Book-Entry Amortizing Notes will be made
semiannually on June 1 and December 1 of each year or
quarterly on March 1, June 1, September 1 and December 1 of
each year, and at maturity (or any redemption or repayment
date); PROVIDED, HOWEVER, that in the case of a Fixed Rate
Book-Entry Note issued between a Record Date and an Interest
Payment Date or on an Interest Payment Date, the first
interest payment will be made on the Interest Payment Date
following the next succeeding Record Date. If any Interest
Payment Date for a Fixed Rate Book-Entry Note is not a
Business Day, the payment due on such day shall be made on the
next succeeding Business Day and no interest shall accrue on
such payment for the period from and after such Interest
Payment Date.
FLOATING RATE BOOK-ENTRY NOTES. Interest payments will be made
on Floating Rate Book-Entry Notes monthly, quarterly,
semiannually or annually. Unless otherwise specified pursuant
to Settlement Procedure "A" below, interest will be payable,
in the case of Floating Rate Book-Entry Notes with a daily,
weekly or monthly Interest Reset Date (other than the 11th
District Cost of Funds Rate Notes), on the third Wednesday of
each month or on the third Wednesday of March, June, September
and December or, in the case of 11th District Cost of Funds
Rate Notes, all of which reset monthly, the first calendar day
of each month, as specified pursuant to Settlement Procedure
"A" below; in the case of Floating Rate Book-Entry Notes with
a quarterly Interest Reset Date, on the third Wednesday of
March, June, September and December of each year; in the case
of Floating Rate Book-Entry Notes with a semiannual Interest
Reset Date, on the third Wednesday of the two months specified
pursuant to Settlement Procedure "A" below; and in the case of
Floating Rate Book-Entry Notes with an annual Interest Reset
Date, on the third Wednesday of the month specified pursuant
to Settlement Procedure "A" below and, in each case at
maturity; PROVIDED, HOWEVER, that if an Interest Payment Date
for Floating Rate Book-Entry Notes would otherwise be a day
that is not a Business Day with respect to such Floating Rate
Book-Entry Notes, such Interest Payment Date will be the next
succeeding Business Day with respect to such Floating Rate
Book-Entry Notes, except in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such
Interest Payment Date will be the immediately preceding
Business Day; and PROVIDED, FURTHER, that in the case of a
Floating Rate Book-Entry Note issued between a Record Date and
the related Interest Payment Date (a "Book-Entry Gap Note"),
the first interest payment will be made on the Interest
Payment Date following the next succeeding Record Date.
<PAGE> 42
8
NOTICE OF INTEREST PAYMENT AND RECORD DATES. On the first
Business Day of February, May, August and November of each
year, the Paying Agent will deliver to the Trustee and DTC a
written list of Record Dates and Interest Payment Dates that
will occur with respect to Book-Entry Notes during the
six-month period beginning on such first Business Day.
Promptly after each date upon which interest is determined for
Floating Rate Notes issued in book-entry form, the Calculation
Agent, if other than the Company, will notify the Company, the
Trustee, Paying Agent and Standard & Poor's Corporation of the
interest rates determined on such dates.
Calculation of FIXED RATE BOOK-ENTRY NOTES. Interest on Fixed Rate
Interest: Book-Entry Notes (including interest for partial periods) will
be calculated on the basis of a 360-day year of twelve
thirty-day months.
FLOATING RATE BOOK-ENTRY NOTES. Interest rates on Floating
Rate Book-Entry Notes will be determined as set forth in the
form of such Notes or in the applicable Pricing Supplement.
Interest on Floating Rate Book-Entry Notes will be calculated
on the basis of actual days elapsed and a year of 360 days,
except that, in the case of Treasury Rate Notes and CMT Rate
Notes, interest will be calculated on the basis of the actual
number of days in the year.
Payments of PAYMENTS OF INTEREST ONLY. Promptly after each Record Date,
Principal and the Trustee will deliver to the Company and DTC a written
Interest: notice specifying by CUSIP number the amount of interest to be
paid on each Global Security other than an Amortizing Note on
the following Interest Payment Date (other than an Interest
Payment Date coinciding with maturity or any earlier
redemption or repayment date) and the total of such amounts.
DTC will confirm the amount payable on each such Global
Security on such Interest Payment Date by reference to the
daily bond reports published by Standard & Poor's Corporation.
In the case of Amortizing Notes, the Paying Agent, if other
than the Company, will provide separate written notice to the
Company, the Trustee and to DTC prior to each Interest Payment
Date at the time and in the manner set forth in the Letter of
Representation. If the Paying Agent is the Company, then
notice need only be given to the Trustee and to DTC. The
Company will pay to the Paying Agent, the total amount of
interest due on such Interest Payment Date (and, in the case
of an Amortizing Note, principal and interest) (other than at
maturity), and the Paying Agent will pay such amount to DTC at
the times and in the manner set forth below under "Manner of
Payment."
<PAGE> 43
9
PAYMENTS AT MATURITY OR UPON REDEMPTION OR REPAYMENT. On or
about the first Business Day of each month, the Paying Agent
will deliver to the Company and DTC a written list of
principal and interest to be paid on each Global Security
other than an Amortizing Note maturing either at maturity or
on a redemption or repayment date in the following month. The
Company and DTC will confirm the amounts of such principal and
interest payments with respect to each such Global Security on
or about the fifth Business Day preceding the Maturity Date or
redemption or repayment date of such Global Security. In the
case of Amortizing Notes, the Paying Agent will provide
separate written notice to the Company (if required) and to
DTC prior to the Maturity Date and any redemption or repayment
date, as the case may be, at the times and in the manner set
forth in the Letter of Representation. The Company will pay to
the Paying Agent the principal amount of such Global Security,
together with interest due at such Maturity Date or redemption
or repayment date. The Paying Agent will pay such amounts to
DTC at the times and in the manner set forth below under
"Manner of Payment."
PAYMENTS NOT ON BUSINESS DAYS. If any Interest Payment Date or
the Maturity Date or redemption or repayment date of a Global
Security representing Fixed Rate Book-Entry Notes is not a
Business Day, the payment due on such day shall be made on the
next succeeding Business Day and no interest shall accrue on
such payment for the period from and after such Interest
Payment Date, Maturity Date or redemption or repayment date,
as the case may be. If any Interest Payment Date or the
Maturity Date or redemption or repayment date of a Global
Security representing a Floating Rate Book-Entry Note would
otherwise fall on a day that is not a Business Day, the
payment due on such day shall be made on the next succeeding
day that is a Business Day with respect to such Notes with the
same effect as if such Business Day were the Interest Payment
Date, Maturity Date or date of redemption or repayment, as the
case may be, except that, in the case of Book-Entry LIBOR
Notes, if such Business Day is in the next succeeding calendar
month, such Interest Payment Date or redemption or repayment
date shall be the immediately preceding day that is a Business
Day with respect to such Book-Entry LIBOR Notes. Promptly
after payment to DTC of the principal and interest due on the
Maturity Date or redemption or repayment date of such Global
Security, the Registrar will cancel such Global Security in
accordance with the terms of the Indenture and deliver it to
the Company with a certificate of cancellation. On the first
Business Day of each month, the Trustee will deliver to the
Company a
<PAGE> 44
10
written statement indicating the total principal amount of
outstanding Book-Entry Notes as of the immediately preceding
Business Day.
MANNER OF PAYMENT. The total amount of any principal and
interest due on Global Securities on any Interest Payment Date
or at maturity or upon redemption or repayment shall be paid
by the Company to the Paying Agent in funds available for
immediate use by the Paying Agent as of 9:30 A.M. (New York
City time) on such date. The Company will make such payment on
such Global Securities by wire transfer to the Paying Agent or
by instructing the Paying Agent to withdraw funds from an
account maintained by the Company at the Paying Agent solely
for such purpose. The Company will confirm such instructions
in writing to the Trustee and the Paying Agent. Prior to 10
A.M. (New York City time) on each Maturity Date or redemption
or repayment date or, if either such date is not a Business
Day, as soon as possible thereafter, following receipt of such
funds from the Company the Paying Agent will pay by separate
wire transfer (using Fedwire message entry instructions in a
form previously specified by DTC) to an account at the Federal
Reserve Bank of New York previously specified by DTC, in funds
available for immediate use by DTC, each payment of principal
(together with interest thereon) due on Global Securities on
any Maturity Date or redemption or repayment date. On each
Interest Payment Date or, if any such date is not a Business
Day, as soon as possible thereafter, interest payments and, in
the case of Amortizing Notes, interest and principal payments
shall be made to DTC in same day funds in accordance with
existing arrangements between the Trustee and DTC. Thereafter
on each such date, DTC will pay, in accordance with its SDFS
operating procedures then in effect, such amounts in funds
available for immediate use to the respective Participants in
whose names the Book-Entry Notes represented by such Global
Securities are recorded in the book-entry system maintained by
DTC. Neither the Company, the Trustee, nor the Paying Agent
shall have any responsibility or liability for the payment by
DTC to such Participants of the principal of and interest on
the Book-Entry Notes.
WITHHOLDING TAXES. The amount of any taxes required under
applicable law to be withheld from any interest payment on a
Book-Entry Note will be determined and withheld by the
Participant, indirect participant in DTC or other person
responsible for forwarding payments directly to the beneficial
owner of such Note.
Preparation of If any order to purchase a Book-Entry Note is accepted by
or on behalf
<PAGE> 45
11
Pricing of the Company, the Company will prepare a pricing supplement
Supplement: (a "Pricing Supplement") reflecting the terms of such Note and
will arrange to file 10 copies of such Pricing Supplement with
the Commission in accordance with the applicable paragraph of
Rule 424(b) under the Securities Act and will deliver the
number of copies of such Pricing Supplement to the relevant
Agent as such Agent shall request by the close of business on
the following Business Day. The relevant Agent will cause such
Pricing Supplement to be delivered to the purchaser of the
Note.
Pricing Supplements shall be sent to the applicable Agent as
indicated below:
If to Salomon Brothers Inc:
Salomon Brothers Inc
8800 Hidden River Parkway
Tampa, FL 33637
Attn: Enrique Castro
Facsimile Number: (813) 558-4123
If to Chase Securities Inc.:
Chase Securities Inc.
270 Park Avenue
New York, New York 10017
Attn: Rick Zellweger
Telephone Number: (212) 834-3155
Facsimile Number: (212) 834-6534
If to Citicorp Securities, Inc.:
Citicorp Securities, Inc.
399 Park Avenue
New York, New York 10043
Attn: J. Darrell Thomas
Telephone Number: (212) 291-4096
Facsimile Number: (212) 291-3910
If to CS First Boston Corporation:
<PAGE> 46
12
CS First Boston Corporation
5 World Trade Center
New York, New York 10048
Attn: Joan Bryan
Telephone Number: (212) 322-5105
Facsimile Number: (212) 803-4096
with a copy for recordkeeping purposes to:
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10005
Attn: Short and Medium Term Finance
Facsimile Number: (212) 318-1498
If to Goldman, Sachs & Co.:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attn: Medium-Term Note Trading
Facsimile Number: (212) 902-0658
If to J.P. Morgan Securities Inc.:
J.P. Morgan Securities Inc.
60 Wall Street, 3rd Floor
New York, New York 10260
Attn: Medium-Term Note Desk
Facsimile Number: (212) 648-5909
In each instance that a Pricing Supplement is prepared, the
Agent receiving such Pricing Supplement will affix the Pricing
Supplement to Prospectuses prior to their use. Outdated
Pricing Supplements, and the Prospectuses to which they are
attached (other than those retained for files), will be
destroyed.
Settlement: The receipt by the Company of immediately available funds in
payment for a Book-Entry Note and the authentication and
issuance of the Global Security representing such Note shall
constitute "settlement" with respect
<PAGE> 47
13
to such Note. All orders accepted by the Company will be
settled on the fifth Business Day following such acceptance
pursuant to the timetable for settlement set forth below
unless the Company and the purchaser agree to settlement on
another day, which shall be no earlier than the next Business
Day.
Settlement Settlement Procedures with regard to each Book-Entry Note sold
Procedures: by the Company to or through an Agent shall be as follows
(unless otherwise specified pursuant to a Terms Agreement, as
defined in the Agreement):
A. The relevant Agent will advise the Company by telephone or
facsimile transmission or other acceptable means of the
following settlement information:
1. Title.
2. Specified Currency, if any.
3. Principal amount.
4. Original Issue Date.
5. Settlement Date, Time and Place.
6. Stated Maturity.
7. In the case of a Fixed Rate Book-Entry
Note, the Interest Rate, whether such Note
will pay interest annually or semi-annually
and whether such Note is an Amortizing Note
and, if so, the Amortization Schedule, or,
in the case of a Floating Rate Book- Entry
Note, the Initial Interest Rate (if known at
such time), Interest Payment Date(s),
Interest Accrual Date, Calculation Agent,
Exchange Rate Agent (if any), Base Rate,
Index Maturity, Interest Reset Period,
Initial Interest Reset Date, Interest Reset
Dates, Spread or Spread Multiplier (if any),
Minimum Interest Rate (if any), Maximum
Interest Rate (if any) and the Interest
Determination Date).
8. Redemption or repayment provisions, if any.
9. Extension Provisions, if any.
10. Amortization provisions, if any.
<PAGE> 48
14
11. Purchase Price.
12. Price to Public.
13. Agent's commission, if any, determined as
provided in the Agreement.
14. Net proceeds to the Company.
15. The Agent's Participant account number at DTC.
16. Any other applicable Terms.
B. The Company will advise the Registrar and the Trustee by
telephone facsimile transmission or other acceptable means of
the information set forth in Settlement Procedure "A" above
(which transmission shall constitute "Instructions" as such
term is defined in the Officer's Certificates relating to the
Notes pursuant to Section 301 of the Senior Indenture and the
Subordinated Indenture). The Company will then assign a CUSIP
number to the Global Security representing such Note and will
notify the Company and the Agent of such CUSIP number by
telephone or electronic transmission (confirmed in writing) as
soon as practicable.
C. The Registrar will enter a pending deposit message through
DTC's Participant Terminal System, providing the following
settlement information to DTC, the relevant Agent and Standard
& Poor's Corporation:
1. The information set forth in Settlement Procedure
"A".
2. The Initial Interest Payment Date for such Note, the
number of days by which such date succeeds the
related DTC Record Date (which in the case of
Floating Rate Notes which reset daily or weekly,
shall be the date five calendar days immediately
preceding the applicable Interest Payment Date and,
in the case of all other Notes, shall be the Record
Date as defined in the Note) and, if known, the
amount of interest payable on such Initial Interest
Payment Date.
3. The CUSIP number of the Global Security representing
such Note.
<PAGE> 49
15
4. Whether such Global Security will represent any other
BookEntry Note (to the extent known at such time) and
whether such Note is an Amortizing Note (by an
appropriate notation in the comments field of DTC's
Participant Terminal System).
5. The DTC participant number of the institution through
which the Company will hold the Book-Entry Note.
D. The Registrar will complete and authenticate the Global
Security representing such Note in accordance with the terms
of the written order of the Company then in effect.
E. DTC will credit such Note to the Registrar's participant
account at DTC.
F. The Registrar will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i) debit
such Note to the Registrar's participant account and credit
such Note to the relevant Agent's participant settlement
account and credit the Registrar's settlement account for an
amount equal to the price of such Note less such Agent's
commission, if any. The entry of such a deliver order shall
constitute a representation and warranty by the Registrar to
DTC that (a) the Global Security representing such Book-Entry
Note has been issued and authenticated and (b) the Registrar
is holding such Global Security pursuant to the Medium- Term
Note Certificate Agreement between the Trustee, the Registrar
and DTC.
G. Unless the relevant Agent purchased such Note as principal,
such Agent will enter an SDFS deliver order through DTC's
Participant Terminal System instructing DTC (i) to debit such
Note to such Agent's participant account and credit such Note
to the participant accounts of the Participants with respect
to such Note and (ii) to debit the settlement account of such
Participants and credit the settlement account of such Agent
for an amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS deliver orders
described in Settlement Procedures "F" and "G" will be settled
in accordance with SDFS operating procedures in effect on the
settlement date.
I. The Registrar, upon confirming receipt of such funds, will
credit to the U.S. dollar account of the Company maintained at
a bank in New
<PAGE> 50
16
York City, notified to the Registrar from time to time, in
funds available for immediate use in the amount transferred to
the Registrar, in accordance with Settlement Procedure "F".
J. Unless the relevant Agent purchased such Note as principal,
such Agent will confirm the purchase of such Note to the
purchaser either by transmitting to the Participants with
respect to such Note a confirmation order or orders through
DTC's institutional delivery system or by mailing a written
confirmation to such purchaser.
K. Monthly, the Registrar will send to the Trustee and the
Company a statement setting forth the principal amount of
Notes Outstanding as of that date under the Indenture and
setting forth a brief description of any sales of which the
Company has advised the Registrar but which have not yet been
settled.
Settlement For sales by the Company of Book-Entry Notes to or through an
Procedures Agent (unless otherwise specified pursuant to a Terms
Timetable: Agreement) for settlement on the first Business Day after the
sale date, Settlement Procedures "A" through "J" set forth
above shall be completed as soon as possible but not later
than the respective times (New York City time) set forth
below:
SETTLEMENT
PROCEDURE TIME
--------- ----
A 11:00 A.M. on the sale date
B 12:00 noon on the sale date
C 2:00 P.M. on the sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one Business Day after
the sale date, Settlement Procedures "A", "B" and "C" shall be
completed as soon as practicable but no later than 11:00 A.M.,
12 noon and 2:00 P.M., respectively, on the first Business Day
after the sale date. If the Initial Interest Rate for a
Floating Rate Book-Entry Note has not been determined at the
time that Settlement Procedure "A" is completed, Settlement
Procedures "B" and "C" shall be completed as soon as such
<PAGE> 51
17
rate has been determined but no later than 12 noon and 2:00
P.M., respectively, on the second Business Day before the
settlement date. Settlement Procedure "H" is subject to
extension in accordance with any extension of Fedwire closing
deadlines and in the other events specified in the SDFS
operating procedures in effect on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
cancelled, the Trustee, after receiving notice from the
Company or the Agent, will deliver to DTC, through DTC's
Participant Terminal System, a cancellation message to such
effect by no later than 2:00 P.M. on the Business Day
immediately preceding the scheduled settlement date.
Failure If the Registrar fails to enter an SDFS deliver order with
to Settle: respect to a Book-Entry Note pursuant to Settlement Procedure
"F", the Registrar may deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to the
Registrar's participant account, provided that the Registrar's
participant account contains a principal amount of the Global
Security representing such Note that is at least equal to the
principal amount to be debited. If a withdrawal message is
processed with respect to all the Book-Entry Notes represented
by a Global Security, the Registrar will mark such Global
Security "cancelled", make appropriate entries in the
Registrar's records and send such cancelled Global Security to
the Company. The CUSIP number assigned to such Global Security
shall, in accordance with CUSIP Service Bureau procedures, be
cancelled and not immediately reassigned. If a withdrawal
message is processed with respect to one or more, but not all,
of the Book-Entry Notes represented by a Global Security, the
Registrar will exchange such Global Security for two Global
Securities, one of which shall represent such Book-Entry Note
or Notes and shall be cancelled immediately after issuance and
the other of which shall represent the remaining Book-Entry
Notes previously represented by the surrendered Global
Security and actions described in the preceding paragraph.
If the purchase price for any Book-Entry Note is not timely
paid to the Participants with respect to such Note by the
beneficial purchaser thereof (or a person, including an
indirect participant in DTC, acting on behalf of such
purchaser), such Participants and, in turn, the Agent may
enter a deliver order through DTC's Participant Terminal
System debiting such Note to such Agent's participant account
and crediting such Note to the participant account of the
Trustee and shall notify the Trustee and the Company thereof.
Thereafter, the Trustee, (i) will immediately notify the
Company, once the Trustee has confirmed that such Note has
been
<PAGE> 52
18
credited to its participant account, and the Company shall
immediately transfer by Fedwire (in immediately available
funds) to the Agent an amount equal to the price of such Note
which was previously sent by wire transfer to the account of
the Company maintained at and
(ii) the Trustee will deliver the withdrawal message and take
the related actions described in the preceding paragraph. Such
debits and credits will be made on the settlement date, if
possible, and in any event not later than 5:00 P.M. on the
following Business Day. If the fail shall have occurred for
any reason other than failure of such Agent to provide the
settlement information to the Company or to provide a
confirmation to the purchaser, the Company will reimburse the
Agent on an equitable basis for its loss of the use of funds
during the period when the funds were credited to the account
of the Company.
Notwithstanding the foregoing, upon any failure to settle with
respect to a Book-Entry Note, DTC may take any action in
accordance with its SDFS operating procedures then in effect.
In the event of a failure to settle with respect to one or
more, but not all, of the Book-Entry Notes to have been
represented by a Global Security, the Trustee will provide, in
accordance with Settlement Procedures "D" and "F", for the
authentication and issuance of a Global Security representing
the Book-Entry Notes to be represented by such Global Security
and will make appropriate entries in its records.
Posting Rates The Company and the Agents will discuss from time to
by Company: time the rates of interest per annum to be borne by and the
maturity of Securities that may be sold as a result of the
solicitation of offers by an Agent. The Company may establish
a fixed set of interest rates and maturities for an offering
period ("posting"). If the Company decides to change already
posted rates, it will promptly advise the Agents to suspend
solicitation of offers until the new posted rates have been
established with the Agent.
Trustee Not To Nothing herein shall be deemed to require the Paying
Risk Funds: Agent or the Trustee to risk or expend its own funds in
connection with any payments to the Company, the Agents, DTC
or any holders of Notes, it being understood by all parties
that payments made by the Trustee or the Paying Agent to the
Company, the Agents, DTC or any holders of Notes shall be made
only to the extent that funds are provided to the Trustee for
such purpose.
<PAGE> 53
19
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
The Trustee will serve as registrar in connection with the
Certificated Notes.
Issuance: Each Certificated Note will be dated and issued as of the date
of its authentication by the Trustee. Each Certificated Note
will bear an Original Issue Date, which will be (i) with
respect to an original Certificated Note (or any portion
thereof), its original issuance date (which will be the
settlement date) and (ii) with respect to any Certificated
Note (or any portion thereof) issued subsequently upon
exchange of a Certificated Note, or in lieu of a destroyed,
lost or stolen Certificated Note, the original issuance date
of the predecessor Certificated Note, regardless of the date
of authentication of such subsequently issued Certificated
Note.
Registration: Certificated Notes will be issued only in fully registered
form without coupons.
Transfers and A Certificated Note may be presented for transfer or
Exchanges: exchange at the principal corporate trust office of the
Registrar. Certificated Notes will be exchangeable for other
Certificated Notes having identical terms but different
authorized denominations without service charge. Certificated
Notes will not be exchangeable for Book-Entry Notes.
Maturities: Each Certificated Note will mature on a date nine months or
more from date of issue.
Currency: The currency denomination with respect to any Certificated
Note and the currency of payment of interest and principal
with respect to any such Certificated Note shall be as set
forth therein and in the applicable pricing supplement.
Denominations: Unless otherwise provided in a Prospectus Supplement, the
denomination of any Certificated Note will be a minimum of
$100,000 or any amount in excess thereof that is an integral
multiple of $1,000 (or in the case of Notes not denominated in
U.S. dollars as specified in the applicable Pricing
Supplement).
Interest: GENERAL. Interest on each Certificated Note will accrue from
the Original Issue Date of such Note for the first interest
period and from the most recent date to which interest has
been paid for all subsequent interest periods. Unless
otherwise specified therein, each payment of interest on a
Certificated Note will include interest accrued to but
<PAGE> 54
20
excluding the Interest Payment Date; provided that in the case
of Floating Rate Notes with respect to which the Interest
Reset Period is daily or weekly, interest payable on any
Interest Payment Date (other than interest payable on any date
on which principal thereof is payable, and, if the Note is a
Certificated Gap Note (as defined below), other than interest
payable on the first Interest Payment Date after the Original
Issue Date thereof) will include interest accrued through and
including the Record Date immediately preceding the Interest
Payment Date, except that at maturity or earlier redemption or
repayment, the interest payable will include interest accrued
to, but excluding, the Maturity Date or the date of redemption
or repayment, as the case may be.
RECORD DATES. The Record Date with respect to any Interest
Payment Date in respect of a Certificated Note shall be the
date 15 calendar days immediately preceding such Interest
Payment Date.
FIXED RATE CERTIFICATED NOTES. Unless otherwise specified
pursuant to Settlement Procedure "A" below, interest payments
on Fixed Rate Certificated Notes, other than Amortizing Notes,
will be made semiannually on June 1 and December 1 of each
year, and at maturity or upon any earlier redemption or
repayment and principal and interest payments on Certificated
Amortizing Notes will be made semiannually on June 1 and
December 1 of each year or quarterly on March 1, June 1,
September 1 and December 1 of each year, and at maturity (or
any redemption or repayment date); PROVIDED, HOWEVER, that in
the case of a Fixed Rate Certificated Note issued between a
Record Date and an Interest Payment Date or on an Interest
Payment Date, the first interest Payment will be made on the
Interest Payment Date following the next succeeding Record
Date.
FLOATING RATE CERTIFICATED NOTES. Interest payments will be
made on Floating Rate Certificated Notes monthly, quarterly,
semiannually or annually. Unless otherwise specified pursuant
to Settlement Procedure "A" below, interest will be payable,
in the case of Floating Rate Certificated Notes with a daily,
weekly or monthly Interest Reset Date (other than the 11th
District Cost of Funds Rate Notes), on the third Wednesday of
each month or on the third Wednesday of March, June, September
and December or, in the case of 11th District Cost of Funds
Rate Notes, all of which reset monthly, the first calendar day
of each month, as specified pursuant to Settlement Procedure
"A" below; in the case of Floating Rate Certificated Notes
with a quarterly Interest Reset Date, on the third Wednesday
of March, June, September and December of each year; in the
case of Floating Rate Certificated Notes with a
<PAGE> 55
21
semiannual Interest Reset Date, on the third Wednesday of the
two months specified pursuant to Settlement Procedure "A"
below; and in the case of Floating Rate Certificated Notes
with an annual Interest Reset Date, on the third Wednesday of
the month specified pursuant to Settlement Procedure "A"
below; PROVIDED, HOWEVER, that if an Interest Payment Date for
Floating Rate Certificated Notes would otherwise be a day that
is not a Business Day with respect to such Floating Rate
Certificated Notes, such Interest Payment Date will be the
next succeeding Business Day with respect to such Floating
Rate Certificated Notes, except in the case of a LIBOR Note if
such Business Day is in the next succeeding calendar month,
such Interest Payment Date will be the immediately preceding
Business Day; and PROVIDED, FURTHER, that in the case of a
Floating Rate Certificated Note issued between a Record Date
and the related Interest Payment Date (a "Certificated Gap
Note"), the first interest payment will be made on the
Interest Payment Date following the next succeeding Record
Date, and in such case, notwithstanding the fact that an
Interest Reset Date may occur prior to such Interest Payment
Date, the Initial Interest Rate shall remain in effect until
the first Interest Reset Date occurring on or subsequent to
such Interest Payment Date.
NOTICE OF INTEREST PAYMENT AND RECORD DATES. On the first
Business Day of February, May, August and November of each
year, the Paying Agent will deliver to the Company and to the
Trustee a written list of Record Dates and Interest Payment
Dates that will occur with respect to Certificated Notes
during the six-month period beginning on such first Business
Day. Promptly after each date upon which interest is
determined for Floating Rate Notes issued in certificated
form, the Calculation Agent will notify the Company, the
Paying Agent and the Trustee of the interest rates determined
on such dates.
Calculation of FIXED RATE CERTIFICATED NOTES. Interest on Fixed Rate
Interest: Certificated Notes (including interest for partial periods)
will be calculated on the basis of a 360-day year of twelve
30-day months.
FLOATING RATE CERTIFICATED NOTES. Interest rates on Floating
Rate Certificated Notes will be determined as set forth in the
form of such Notes. Interest on Floating Rate Certificated
Notes will be calculated on the basis of actual days elapsed
and a year of 360 days, except that, in the case of Treasury
Rate Notes, interest will be calculated on the basis of the
actual number of days in the year.
Payments of The Company will pay to the Paying Agent, the principal
<PAGE> 56
22
Principal and amount of each Certificated Note (other than an Amortizing
Interest: Note), together with interest due thereon, at its Maturity
Date or upon redemption or repayment of such Note in funds
available for immediate use by the Paying Agent. In the case
of an Amortizing Note, the Company will pay to the Paying
Agent the principal amount due on such Note on such date,
together with interest due thereon, at its Maturity Date or
upon redemption or repayment of such Note in funds available
for immediate use by the Paying Agent. The Paying Agent will
pay such amount to the holder of such Note at its Maturity
Date or upon redemption or repayment of such Note upon
presentation and surrender of such Note to the Paying Agent.
Such payment, together with payment of interest due at
maturity or upon redemption or repayment, will be made in
funds available for immediate use by the holder of such Note.
Promptly after such presentation and surrender, the Registrar
will cancel such Certificated Note in accordance with the
terms of the Indenture and deliver it to the Company with a
certificate of cancellation. Unless otherwise specified in the
applicable Pricing Supplement, all interest payments on a
Certificated Note or, in the case of a Certificated Amortizing
Note, payments of principal and interest (other than interest
(or interest and principal) due at maturity or upon redemption
or repayment) will be made by check drawn on the Trustee (or
another person appointed by the Trustee) and mailed by the
Paying Agent to the person entitled thereto as provided in
such Note and the Indenture; PROVIDED, HOWEVER, that (i) the
holder of $10,000,000 or more of Notes having the same
Interest Payment Date will be entitled to receive payment by
wire transfer of immediately available funds and (ii) unless
otherwise specified in the applicable Pricing Supplement or
unless alternative arrangements are made, payments on Notes in
a currency other than U.S. dollars will be made by wire
transfer of immediately available funds to an account
maintained by the payee with a bank located outside the United
States and, with respect to clauses (i) and (ii) above, the
holder of such Notes will provide the Paying Agent with
appropriate and timely wire transfer instructions.
Promptly after each Record Date, the Paying Agent will deliver
to the Company a written notice specifying the amount of
interest to be paid on each Certificated Note other than an
Amortizing Note on the following Interest Payment Date (other
than an Interest Payment Date coinciding with maturity or any
earlier redemption or repayment date) and the total of such
amounts. In the case of Amortizing Notes, the Paying Agent
will provide separate written notice to the Company specifying
the amount of interest and principal to be paid on each
Amortizing Note on the following Interest Payment Date (other
than an Interest Payment
<PAGE> 57
23
Date coinciding with maturity or any earlier redemption or
repayment date) and the total of such amounts. Interest at
maturity or upon redemption or repayment will be payable to
the person to whom the payment of principal is payable. On or
about the first Business Day of each month, the Paying Agent
will deliver to the Company and the Trustee a written list of
principal and interest, to the extent ascertainable, to be
paid on each Certificated Note including Amortizing Notes
maturing or to be redeemed or repaid in the following month.
The Paying Agent will be responsible for withholding taxes on
interest paid on Certificated Notes as required by applicable
law.
If any Interest Payment Date or the Maturity Date or
redemption or repayment date of a Fixed Rate Certificated Note
is not a Business Day, the payment due on such day shall be
made on the next succeeding Business Day and no interest shall
accrue on such payment for the period from and after such
Interest Payment Date, Maturity Date or redemption or
repayment date, as the case may be. If any Interest Payment
Date or the Maturity Date or redemption or repayment date of a
Floating Rate Certificated Note would otherwise fall on a day
that is not a Business Day with respect to such Note, the
payment due on such day shall be made on the next succeeding
day that is a Business Day with respect to such Note with the
same effect as if such Business Day were the stated Interest
Payment Date, Maturity Date or date of redemption or
repayment, as the case may be, except that, in the case of
Certificated LIBOR Notes, if such Business Day is in the next
succeeding calendar month, such Interest Payment Date,
Maturity Date or redemption or repayment date shall be the
immediately preceding day that is a Business Day with respect
to such Certificated LIBOR Notes.
Preparation of If any order to purchase a Certificated Note is accepted by
Pricing or on behalf of the Company, the Company will prepare a
Supplement: Pricing Supplement reflecting the terms of such Note and will
arrange to file 10 copies of such Pricing Supplement with the
Commission in accordance with the applicable paragraph of Rule
424(b) under the Act and will deliver the number of copies of
such Pricing Supplement to the relevant Agent as such Agent
shall request by the close of business on the following
Business Day. The relevant Agent will cause such Pricing
Supplement to be delivered to the purchaser of the Note.
Pricing Supplements shall be sent to the applicable Agent as
indicated below:
If to Salomon Brothers Inc:
<PAGE> 58
24
Salomon Brothers Inc
8800 Hidden River Parkway
Tampa, FL 33637
Attn: Enrique Castro
Facsimile Number: (813) 558-4123
If to Chase Securities Inc.:
Chase Securities Inc.
270 Park Avenue
New York, New York 10017
Attn: Rick Zellweger
Telephone Number: (212) 834-3155
Facsimile Number: (212) 834-6534
If to Citicorp Securities, Inc.:
Citicorp Securities, Inc.
399 Park Avenue
New York, New York 10043
Attn: J. Darrell Thomas
Telephone Number: (212) 291-4096
Facsimile Number: (212) 291-3910
If to CS First Boston Corporation:
CS First Boston Corporation
5 World Trade Center
New York, New York 10048
Attn: Joan Bryan
Telephone Number: (212) 322-5105
Facsimile Number: (212) 803-4096
with a copy for recordkeeping purposes to:
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10005
Attn: Short and Medium Term Finance
Facsimile Number: (212) 318-1498
<PAGE> 59
25
If to Goldman, Sachs & Co.:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attn: Medium-Term Note Trading
Facsimile Number: (212) 902-0658
If to J.P. Morgan Securities Inc.:
J.P. Morgan Securities Inc.
60 Wall Street, 3rd Floor
New York, New York 10260
Attn: Medium-Term Note Desk
Facsimile Number: (212) 648-5909
In each instance that a Pricing Supplement is prepared, the
Agent receiving such Pricing Supplement will affix the Pricing
Supplement to Prospectuses prior to their use. Outdated
Pricing Supplements, and the Prospectuses to which they are
attached (other than those retained for files), will be
destroyed.
Settlement: The receipt by the Company of immediately available funds in
payment for an authenticated Certificated Note delivered to
the relevant Agent and such Agent's delivery of such Note
against receipt of immediately available funds shall
constitute "settlement" with respect to such Note. All orders
accepted by the Company will be settled on the fifth Business
Day following such acceptance pursuant to the timetable for
settlement set forth below unless the Company and the
purchaser agree to settlement on another day, which shall be
no earlier than the next Business Day.
Settlement Settlement Procedures with regard to each Certificated Note
Procedures: sold by the Company to or through an Agent shall be as follows
(unless otherwise specified pursuant to a Terms Agreement):
A. The relevant Agent will advise the Company by
facsimile transmission or other acceptable means that
such Note is a Certificated Note and of the following
settlement information:
1. Name in which such Note is to be registered
("Registered Owner").
<PAGE> 60
26
2. Address of the Registered Owner and address
for payment of principal and interest.
3. Taxpayer identification number of the
Registered Owner (if available).
4. Title.
5. Specified Currency.
6. Principal Amount.
7. Original Issue Date.
8. Settlement Date, Time and Place.
9. Stated Maturity.
10. In the case of a Fixed Rate Certificated
Note, the Interest Rate, whether such Note
will pay interest annually or semi- annually
and whether such Note is an Amortizing Note
and, if so, the Amortization Schedule, or,
in the case of a Floating Rate Certificated
Note, the Initial Interest Rate (if known at
such time), Interest Payment Date(s),
Interest Accrual Date, Calculation Agent,
Exchange Rate Agent (if any), Base Rate,
Index Maturity, Interest Reset Period,
Initial Interest Reset Date, Interest Reset
Dates, Spread or Spread Multiplier (if any),
Minimum Interest Rate (if any), Maximum
Interest Rate (if any) and the Interest
Determination Date.
11. Redemption or repayment provisions, if any.
12. Extension Provisions, if any.
13. Amortization Provisions, if any.
14. Purchase Price.
15. Price to Public.
16. Agent's commission, if any, determined as
provided in the Agreement.
<PAGE> 61
27
17. Denominations.
18. Net proceeds to the Company.
19. Any other applicable Terms.
B. The Company will advise the Registrar and the Trustee
by telephone, facsimile transmission or other
acceptable means of the information set forth in
Settlement Procedure "A" above (which transmission
shall constitute "Instructions" as such term is
defined in the Officer's Certificates relating to the
Notes pursuant to Section 301 of the Senior Indenture
and the Subordinated Indenture).
C. The Company will have delivered to the Registrar a
pre-printed four-ply packet for such Note, which
packet will contain the following documents in forms
that have been approved by the Company, the relevant
Agent and the Trustee:
1. Note with customer confirmation.
2. Stub One - For the Trustee.
3. Stub Two - For the relevant Agent.
4. Stub Three - For the Company.
D. The Registrar will complete such Note and
authenticate such Note and deliver it (with the
confirmation) and Stubs One and Two to the relevant
Agent, and such Agent will acknowledge receipt of the
Note by stamping or otherwise marking Stub One and
returning it to the Registrar. Such delivery will be
made only against such acknowledgement of receipt and
evidence that instructions have been given by such
Agent for payment to the account of the Company
maintained at the Trustee, New York, New York (or,
with respect to Notes payable in a Specified Currency
other than U.S. dollars, to an account maintained at
a bank selected by the Company notified to the
relevant Agent from time to time in writing) in funds
available for immediate use, of an amount equal to
the price of such Note less such Agent's commission,
if any. In the event that the instructions given by
such Agent for payment to the account of the Company
are revoked, the Company will as promptly as possible
wire transfer to the account of such Agent an amount
of
<PAGE> 62
28
immediately available funds equal to the amount of
such payment made.
E. Unless the relevant Agent purchased such Note as
principal, such Agent will deliver such Note (with
confirmation) to the customer against payment in
immediately available funds. Such Agent will obtain
the acknowledgment of receipt of such Note by
retaining Stub Two.
F. The Registrar will send Stub Three to the Company by
first-class mail. Periodically, the Registrar will
also send to the Company and to the Trustee a
statement setting forth the principal amount of the
Notes outstanding as of that date under the Indenture
and setting forth a brief description of any sales of
which the Company has advised the Registrar but which
have not yet been settled.
Settlement For sales by the Company of Certificated Notes to or through
Procedures an Agent (unless otherwise specified pursuant to a Terms
Timetables: Agreement), Settlement Procedures "A" through "F" set forth
above shall be completed on or before the respective times
(New York City time) set forth below:
SETTLEMENT
PROCEDURE TIME
--------- ----
A 2:00 P.M. on day before settlement date
B 3:00 P.M. on day before settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
Failure If a purchaser fails to accept delivery of and make payment
to Settle: for any Certificated Note, the relevant Agent will notify the
Company and the Registrar by telephone and return such Note to
the Registrar. Upon receipt of such notice, the Company will
immediately wire transfer to the account of such Agent an
amount equal to the amount previously credited thereto in
respect of such Note. Such wire transfer will be made on the
settlement date, if possible, and in any event not later than
the Business Day following the settlement date. If the failure
shall have occurred for any reason other than a default by
such Agent in the performance of its obligations hereunder and
under the Agreement, then the Company will reimburse such
Agent or the Trustee or the Registrar, as appropriate, on an
equitable basis for its loss of the use of the funds
<PAGE> 63
29
during the period when they were credited to the account of
the Company (such reimbursement for loss of the use of such
funds to be based on the federal funds effective rate then in
effect). Immediately upon receipt of the Certificated Note in
respect of which such failure occurred, the Registrar will
mark such Note "cancelled", make appropriate entries in the
Registrar's records and send such Note to the Company.
Posting Rates The Company and the Agents will discuss from time to
by Company: time the rates of interest per annum to be borne by and the
maturity of Notes that may be sold as a result of the
solicitation of offers by an Agent. The Company may establish
a fixed set of interest rates and maturities for an offering
period ("posting"). If the Company decides to change already
posted rates, it will promptly advise the Agents to suspend
solicitation of offers until the new posted rates have been
established with the Agent.
Trustee Not to Nothing herein shall be deemed to require the Trustee
Risk Funds: to risk or expend its own funds in connection with any
payments to the Company, the Agents or any holders of Notes,
it being under stood by all parties that payments made by the
Trustee to the Company, the Agents or any holders of Notes
shall be made only to the extent that funds are provided to
the Trustee for such purpose.
<PAGE> 1
[KEYCORP LOGO]
Exhibit (5)
August 21, 1996
Board of Directors
KeyCorp
127 Public Square
Cleveland, Ohio 44114
RE: Registration Statement on Form S-3
----------------------------------
Ladies and Gentlemen:
I am Senior Vice President and Senior Managing Counsel of KeyCorp
Management Company, an affiliate of KeyCorp (the "Corporation"), and I have
acted as counsel to the Corporation in connection with the Registration
Statement on Form S-3 filed on August 21, 1996 with the Securities and Exchange
Commission (the "Commission") pursuant to the Securities Act of 1933, as amended
(the "Registration Statement"). The Registration Statement covers
$1,261,500,000 of securities of the Corporation, consisting of:
(a) senior unsecured debt securities (the "Senior Debt Securities") to
be issued from time to time under an Indenture, a copy of which is incorporated
by reference to Exhibit 4(c) to the Registration Statement No. 33-58405, filed
with the Commission on April 3, 1995 ("Registration Statement No. 33-58405"),
between the Corporation and Bankers Trust New York Corporation, as trustee (the
"Senior Indenture");
(b) subordinated unsecured debt securities (the "Subordinated Debt
Securities" and, together with the Senior Debt Securities, being referred to
herein collectively as the "Debt Securities") to be issued from time to time
under an Indenture, a copy of which is incorporated by reference to Exhibit 4(d)
to the Registration Statement No. 33-58405, between the Corporation and Bankers
Trust New York Corporation, as trustee (the "Subordinated Indenture" and,
together with the Senior Indenture, being referred to herein collectively as the
"Indentures");
(c) shares of preferred stock, with a par value of $1 each, of the
Corporation (the "Preferred Stock");
<PAGE> 2
Board of Directors
Page 2
(d) depositary receipts (the "Depositary Receipts") for depositary
shares (the "Depositary Shares") representing an interest in shares of Preferred
Stock of the Corporation to be issued under a Deposit Agreement, substantially
in the form that is incorporated by reference to Exhibit 4(i) to the
Registration Statement No. 33-58405 (the "Deposit Agreement"), between the
Corporation and a bank or trust company, as depositary (the "Depositary");
(e) common shares, with a par value of $1 each, of the Corporation (the
"Common Shares"); and
(f) warrants entitling the holder to purchase Debt Securities (the
"Debt Warrants"); Preferred Stock (the "Preferred Stock Warrants"), Common
Shares (the "Common Share Warrants") or Depositary Shares (the "Depositary Share
Warrants") and together with the Debt Warrants, the Preferred Stock Warrants and
the Common Share Warrants, being referred to herein collectively as the
"Securities Warrants") to be issued from time to time under a Warrant Agreement,
substantially in the form that is incorporated by reference to Exhibit 4(g) to
the Registration Statement No. 33-58405 (the "Securities Warrant Agreement"),
between the Corporation and a bank or trust company, as warrant agent (the
"Securities Warrant Agent").
The Debt Securities, Preferred Stock, Depositary Shares, Common Shares,
Debt Warrants, Preferred Stock Warrants, Depositary Share Warrants and Common
Share Warrants are referred to herein collectively as the "Securities." Certain
issues of Debt Securities may provide that such Debt Securities are convertible
at the option of the holder or the Corporation into Capital Securities (as
defined in the Registration Statement) of the Corporation and certain series of
Preferred Stock may provide that the Preferred Stock of such series is
convertible at the option of the holder into Common Shares or any other class or
series of Capital Securities of the Corporation or convertible at the option of
the Corporation into Capital Securities or other debt securities of the
Corporation.
I am familiar with the corporate proceedings of the Corporation to date
with respect to the proposed issuance and sale of the Securities, and I have
examined such corporate records of the Corporation and such other documents and
certificates as I have deemed necessary as a basis for the opinions hereinafter
expressed. In rendering this opinion, I have assumed, without any independent
investigation, that (i) all documents that have been submitted to me as
originals are authentic, and that all documents that have been submitted to me
as copies conform to authentic, original documents; and (ii) all persons
executing agreements, instruments or documents examined or relied upon by me had
the capacity to sign such agreements, instruments or documents, and all such
signatures are genuine.
I have assumed that each of the documents have been duly authorized,
executed and delivered by each of the parties thereto other than the Corporation
and constitute valid and legally binding obligations of such parties enforceable
in accordance with their respective
<PAGE> 3
Board of Directors
Page 3
terms, except as limited by Title 11 of the United States Code (Bankruptcy) and
other applicable bankruptcy, insolvency, reorganization, arrangement, fraudulent
transfer, moratorium or other laws relating to or affecting creditors' rights
generally and general principles of equity, constitutional rights and public
policy, regardless of whether enforceability is considered in a proceeding at
law or in equity and except that the provisions requiring payment of attorneys'
fees may not be enforced by courts applying Ohio law.
Based on the foregoing, and having regard for such legal considerations
as I have deemed relevant, I am of the opinion that:
(1) The Corporation is a corporation duly organized and validly
existing under the laws of the State of Ohio.
(2) When in accordance with applicable law appropriate corporate action
has been taken to fix the terms of one or more issues of the Debt Securities
under the applicable Indenture and to authorize their issuance and sale, and
when the Debt Securities with the terms so fixed shall have been duly
authenticated under the applicable Indenture, and issued and sold as described
in the Prospectus included in the Registration Statement as it may at any time
be amended, and in any prospectus supplement relating thereto, pursuant to and
in a manner consistent with such corporate action, such Debt Securities will
constitute valid and legally binding obligations of the Corporation entitled to
the benefits provided by the applicable Indenture.
(3) When and if any Debt Securities that have been issued in accordance
with paragraph 2 or paragraph 7 have been surrendered to the Corporation for
conversion in accordance with the applicable Indenture, and Common Shares,
shares of Preferred Stock or Debt Securities, as the case may be, so issuable
upon such conversion have been, in the case of Common Shares, validly issued or
delivered from Common Shares duly authorized and reserved therefor by
appropriate corporate action, or in the case of shares of Preferred Stock,
validly issued or delivered from shares of any Preferred Stock duly authorized
and reserved therefor after appropriate corporate and other action has been
taken in accordance with paragraph 4, or, in the case of Debt Securities,
validly issued or delivered from Debt Securities duly authorized and the terms
of which have been fixed by appropriate corporate action and authenticated under
an applicable Indenture, such Common Shares or Preferred Stock will be validly
issued, fully paid and nonassessable and such Debt Securities will constitute
valid and legally binding obligations of the Corporation entitled to the
benefits provided by the applicable Indenture.
(4) When appropriate corporate action has been taken to authorize the
issuance and fix the terms of one or more issues of Preferred Stock in
accordance with applicable law and the Corporation's charter documents, such
shares of Preferred Stock will have been duly authorized and, when issued and
sold as described in the Prospectus included in the Registration Statement as it
may at any time be amended, and in any prospectus supplement
<PAGE> 4
Board of Directors
Page 4
relating thereto, pursuant to and in a manner consistent with such corporate
action, such shares of Preferred Stock will be validly issued, fully paid and
nonassessable.
(5) When and if any shares of Preferred Stock that have been issued in
accordance with paragraph 4 or paragraph 7 have been surrendered to the
Corporation for conversion, and Common Shares or Debt Securities, as the case
may be, so issuable upon such conversion, have been duly issued or delivered
from Common Shares duly authorized and reserved therefor by appropriate
corporate action, or, in accordance with paragraph 2, from Debt Securities duly
authorized and the terms of which have been fixed by appropriate corporate
action and authenticated under the applicable Indenture, as the case may be,
such Common Shares will be validly issued, fully paid and nonassessable and such
Debt Securities will constitute valid and legally binding obligations of the
Corporation entitled to the benefits provided by the applicable Indenture.
(6) When appropriate action has been taken to authorize the issuance
and fix the terms of one or more issues of Depositary Shares and the underlying
Preferred Stock in accordance with paragraph 4, and to authorize the execution
and delivery of the related Deposit Agreement, and when such Deposit Agreement
shall have been duly executed and delivered by the Corporation and the
Depositary, such Depositary Shares and shares of underlying Preferred Stock will
have been duly authorized and, when Depositary Receipts for such Depositary
Shares and the Depositary Shares shall have been issued and sold as described in
the prospectus included in the Registration Statement as it may at any time be
amended, and in any prospectus supplement relating thereto, or in accordance
with paragraph 7, pursuant to and in a manner consistent with such
authorization, and when the underlying Preferred Stock shall have been validly
issued after appropriate corporate action and other action has been taken in
accordance with paragraph 4, such Depositary Shares will be validly issued and
will entitle the holders thereof to the rights specified in the Depositary
Receipts and the Deposit Agreement.
(7) When appropriate corporate action has been taken to authorize the
Corporation to execute and deliver the Securities Warrant Agreement, to fix the
terms of one or more issues thereunder of Securities Warrants, and to authorize
their issue, and such Securities Warrant Agreement shall have been duly executed
and delivered by the Corporation and the Securities Warrant Agent, and when
Securities Warrants with terms so fixed shall have been duly countersigned by
the Securities Warrant Agreement in accordance with such corporate action, such
Securities Warrants shall constitute valid and legally binding obligations of
the Corporation, and, where applicable (i) the Debt Securities issuable upon
exercise of any such Securities Warrants, when, in accordance with paragraph 2,
duly authorized by appropriate corporate action and authenticated under the
applicable Indenture, and when paid for in accordance with the terms of the
applicable Securities Warrants, will constitute valid and legally binding
obligations of the Corporation entitled to the benefits provided by the
applicable Indenture; (ii) the shares of Preferred Stock issuable upon exercise
of any such Securities Warrants, when duly authorized and reserved therefor
after appropriate corporate
<PAGE> 5
Board of Directors
Page 5
and other action has been taken in accordance with paragraph 4, and when paid
for in accordance with the terms of the applicable Securities Warrants, will
be validly issued, fully paid and nonassessable; (iii) the Common Shares
issuable upon exercise of any such Securities Warrants when duly authorized and
reserved for issuance therefor by appropriate corporate action, and when paid
for in accordance with the terms of the applicable Securities Warrants, will be
validly issued, fully paid and nonassessable; and (iv) the Depositary Shares
issuable upon exercise of any such Securities Warrants when duly authorized by
appropriate corporate action and other action has been taken in accordance
with paragraph 6, and when paid for in accordance with the applicable
Securities Warrants, will be validly issued and will entitle the holders to the
rights specified in the Depositary Receipts and the Deposit Agreement.
The opinions set forth above are subject to (i) bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium and other similar laws relating to or affecting the
enforcement of creditors' rights generally; (ii) general equitable principles
(regardless of whether enforcement is considered in a proceeding in equity or at
law); and (iii) provisions of law that require that a judgment for money damages
rendered by a court in the United States be expressed only in United States
dollars.
This opinion is given on the basis of the law and the facts existing as
of the date hereof. I assume no obligation to advise you of changes in matters
of fact or law which may thereafter occur. My opinion is based on statutory laws
and judicial decisions that are in effect on the date hereof, and I do not opine
with respect to any law, regulation, rule or governmental policy which may be
enacted or adopted after the date hereof.
I am licensed to practice law in the State of Ohio and, accordingly,
the foregoing opinions are limited solely to the laws of the State of Ohio and
applicable federal laws of the United States. I call your attention to the fact
that the Indentures, the Deposit Agreement, the Securities Warrant Agreement and
certain other documents, agreements and instruments referred to above may be
governed by the laws of New York or a jurisdiction other than Ohio. I express no
opinion as to matters governed by any laws other than laws of the State of Ohio
and the federal laws of the United States of America.
This opinion is intended solely for your use in connection with the
Corporation's Registration Statement on Form S-3 and may not be reproduced,
filed publicly, or relied upon by you for any other purpose or by any other
person for any purpose without our prior written consent.
<PAGE> 6
Board of Directors
Page 6
I hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement and to the use of my name therein.
Very truly yours,
/s/ Daniel R. Stolzer
Daniel R. Stolzer
Senior Vice President and
Senior Managing Counsel
<PAGE> 1
EXHIBIT (12)
KEYCORP
COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(UNAUDITED)
<TABLE>
<CAPTION>
For the Six Months Ended Year ended December 31,
--------------------------------- --------------------------
JUNE 30, 1996 June 30, 1995 1995 1994
-------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
Computation of Earnings:
Net income $ 425 $ 409 $ 825 $ 853
Add: Provision for income taxes 199 163 368 430
Less: Cumulative effect of accounting change -- -- -- --
Extraordinary item -- 36 36 --
-------------- ------------- ------------ ------------
Income before income taxes and
extraordinary item 624 536 1,157 1,283
Fixed charges, excluding interest on deposits 386 400 818 513
-------------- ------------- ------------ ------------
Total earnings for computation,
excluding interest on deposits 1,010 936 1,975 1,796
Interest on deposits 751 853 1,705 1,325
-------------- ------------- ------------ ------------
Total earnings for computation,
including interest on deposits $1,761 $1,789 $ 3,680 $ 3,121
============== ============= ============ ============
Computation of Fixed Charges:
Net rental expense $ 56 $ 57 $ 117 $ 124
============== ============= ============ ============
Portion of net rental expense deemed
representative of interest $ 18 $ 19 $ 39 $ 41
Interest on short-term borrowed funds 235 255 518 334
Interest on long-term debt 133 126 261 138
-------------- ------------- ------------ ------------
Total fixed charges, excluding interest
on deposits 386 400 818 513
Interest on deposits 751 853 1,705 1,325
-------------- ------------- ------------ ------------
Total fixed charges, including interest
on deposits $1,137 $1,253 $ 2,523 $ 1,838
============== ============= ============ ============
Combined Fixed Charges and Preferred Stock
Dividends:
Preferred stock dividend requirement on
a pre-tax basis $ 12 $ 11 $ 23 $ 24
Total fixed charges, excluding interest
on deposits 386 400 818 513
-------------- ------------- ------------ ------------
Combined fixed charges and preferred stock
dividends, excluding interest on deposits 398 411 841 537
Interest on deposits 751 853 1,705 1,325
-------------- ------------- ------------ ------------
Combined fixed charges and preferred stock
dividends, including interest on deposits $1,149 $1,264 $ 2,546 $ 1,862
============== ============= ============ ============
Ratio of Earnings to Fixed Charges:
Excluding deposit interest 2.62 x 2.34 x 2.42 x 3.50 x
Including deposit interest 1.55 x 1.43 x 1.46 x 1.70 x
Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends:
Excluding deposit interest 2.54 x 2.28 x 2.35 x 3.34 x
Including deposit interest 1.53 x 1.42 x 1.45 x 1.68 x
</TABLE>
<TABLE>
<CAPTION>
Year ended December 31,
----------------------------------------
1993 1992 1991
------------ ------------ ------------
<S> <C> <C> <C>
Computation of Earnings:
Net income $ 710 $ 592 $ 314
Add: Provision for income taxes 374 280 137
Less: Cumulative effect of accounting change -- 7 --
Extraordinary item -- -- --
------------ ------------ ------------
Income before income taxes and
extraordinary item 1,084 865 451
Fixed charges, excluding interest on deposits 345 324 422
------------ ------------ ------------
Total earnings for computation,
excluding interest on deposits 1,429 1,189 873
Interest on deposits 1,233 1,469 2,136
------------ ------------ ------------
Total earnings for computation,
including interest on deposits 2,662 2,658 $ 3,009
============ ============ ============
Computation of Fixed Charges:
Net rental expense $ 130 $ 131 $ 119
============ ============ ============
Portion of net rental expense deemed
representative of interest $ 43 $ 43 $ 38
Interest on short-term borrowed funds 175 174 288
Interest on long-term debt 127 107 96
------------ ------------ ------------
Total fixed charges, excluding interest
on deposits 345 324 422
Interest on deposits 1,233 1,469 2,136
------------ ------------ ------------
Total fixed charges, including interest
on deposits $ 1,578 $ 1,793 $ 2,558
============ ============ ============
Combined Fixed Charges and Preferred Stock
Dividends:
Preferred stock dividend requirement on
a pre-tax basis $ 28 $ 36 $ 23
Total fixed charges, excluding interest
on deposits 345 324 422
------------ ------------ ------------
Combined fixed charges and preferred stock
dividends, excluding interest on deposits 373 360 445
Interest on deposits 1,233 1,469 2,136
------------ ------------ ------------
Combined fixed charges and preferred stock
dividends, including interest on deposits $ 1,606 $ 1,829 $2,581
============ ============ ============
Ratio of Earnings to Fixed Charges:
Excluding deposit interest 4.15 x 3.67 x 2.07 x
Including deposit interest 1.69 x 1.48 x 1.18 x
Ratio of Earnings to Combined Fixed Charges:
and Preferred Stock Dividends
Excluding deposit interest 3.84 x 3.31 x 1.96 x
Including deposit interest 1.66 x 1.45 x 1.17 x
</TABLE>
<PAGE> 1
EXHIBIT (23)(a)
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Post-Effective Amendment No. 1 to Form S-3 (No. 33-58405) and to the
Registration Statement (Form S-3) and related Prospectus of KeyCorp for the
registration of a combined $1,261,500,000 of securities and to the incorporation
by reference therein of our report dated January 16, 1996, with respect to the
consolidated financial statements of KeyCorp incorporated by reference in its
Annual Report (Form 10-K) for the year ended December 31, 1995, filed with the
Securities and Exchange Commission.
/s/ Ernst & Young LLP
Cleveland, Ohio
August 14, 1996
<PAGE> 1
EXHIBIT(23)(c)
August 21, 1996
KeyCorp
127 Public Square
Cleveland, Ohio 44114
Ladies and Gentlemen:
We hereby consent to the quotation of our opinion under the heading "United
States Tax Considerations" in the Prospectus Supplement filed as a part of
KeyCorp's Registration Statement on Form S-3 filed with the Securities and
Exchange Commission on August 21, 1996, which Registration Statement also
constitutes the first post-effective amendment to KeyCorp's Registration
Statement on Form S-3, File No. 33-58405, and to the use of our name therein.
Very truly yours,
/s/ Thompson Hine & Flory P.L.L.
<PAGE> 1
EXHIBIT (24)(a)
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ R. W. Gillespie
-------------------
<PAGE> 2
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ K. Brent Somers
-------------------
<PAGE> 3
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Lee G. Irving
-----------------
<PAGE> 4
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Cecil D. Andrus
-------------------
<PAGE> 5
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ William G. Bares
--------------------
<PAGE> 6
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ A. C. Bersticker
--------------------
<PAGE> 7
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ T. A. Commes
----------------
<PAGE> 8
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Kenneth M. Curtis
---------------------
<PAGE> 9
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ John C. Dimmer
------------------
<PAGE> 10
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Stephen R. Hardis
---------------------
<PAGE> 11
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Henry S. Hemingway
-----------------------
<PAGE> 12
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Charles R. Hogan
--------------------
<PAGE> 13
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Douglas J. McGregor
-----------------------
<PAGE> 14
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Steven A. Minter
--------------------
<PAGE> 15
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ M. Thomas Moore
-------------------
<PAGE> 16
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Victor J. Riley, Jr.
------------------------
<PAGE> 17
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Ronald B. Stafford
----------------------
<PAGE> 18
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Dennis W. Sullivan
----------------------
<PAGE> 19
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Peter G. Ten Eyck, II
-------------------------
<PAGE> 20
KEYCORP
-------
POWER OF ATTORNEY
-----------------
The undersigned, an officer or director, or both an officer and
director of KeyCorp, an Ohio corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions
of the Securities Act of 1933, as amended, such registration statements or
amendments to existing registration statements (on Form S-3 or such other
form or forms as are applicable) to effect the shelf registration pursuant
to Rule 415 of the Securities and Exchange Commission of debt, equity,
capital securities and warrants to purchase such securities with an
aggregate issue price of up to $1,261,500,000 to be issued and sold from
time to time in one or more public or private offerings, hereby constitutes
and appoints K. Brent Somers, James W. Wert, John A. Simonson, Thomas C.
Stevens, John H. Mancuso and Daniel R. Stolzer, and each of them, as
attorney for the undersigned, with full power of substitution and
resubstitution for and in the name, place and stead of the undersigned, to
sign and file the proposed registration statements and any and all
amendments, post-effective amendments, and exhibits thereto, and any and all
applications and other documents to be filed with the Securities and
Exchange Commission pertaining to such securities or such registration with
full power and authority to do and perform any and all acts and things
whatsoever requisite and necessary to be done in the premises, hereby
ratifying and approving the acts of such attorney or any such substitute or
substitutes.
IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand
as of July 18, 1996.
/s/ Nancy B. Veeder
-------------------
<PAGE> 1
Exhibit (24)(b)
CERTIFICATION
-------------
I, Steven N. Bulloch, hereby certify that I am the duly elected
Assistant Secretary of KeyCorp, a corporation duly organized and existing under
the laws of the State of Ohio (the "Corporation"), that I have in my possession
the corporate records regarding the Corporation, that attached hereto is a true
and correct copy of a resolution authorizing the increase in the aggregate issue
price of securities available for issuance under Shelf Registration dated July
18, 1996, duly adopted by the Board of Directors of the Corporation in a meeting
thereof duly called and held on July 18, 1996, at which meeting a quorum of the
Board was present throughout, and that the resolution has not been rescinded or
amended and remains in full force and effect.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and the
seal of the Corporation this 21st day of August, 1996.
{SEAL} /s/ Steven N. Bulloch
----------------------------------
Steven N. Bulloch
Assistant Secretary
<PAGE> 2
RESOLUTIONS ADOPTED BY THE BOARD OF DIRECTORS OF KEYCORP ON JULY 18, 1996.
WHEREAS, the Board of Directors has previously authorized by resolution
adopted by the Board of Directors on March 16, 1995 (the "Shelf Resolution") the
issuance and sale by the Corporation of securities pursuant to a Registration
Statement designated by the U.S. Securities and Exchange Commission (the
"Commission") as No. 33-58405 (the "KeyCorp Registration Statement"); and
WHEREAS, unissued securities remaining available for issuance under the
KeyCorp Registration Statement may be issued and sold for an aggregate issue
price of up to $61,500,000 (the "Available Shelf Securities"); and
WHEREAS, the Corporation desires to increase the aggregate issue price
of securities over the amount which may be issued and sold pursuant to the Shelf
Resolution by an additional $1,200,000,000 (the "New Shelf Securities") and also
allow for the possible issuance of the New Shelf Securities and the Available
Shelf Securities pursuant to either private or foreign offerings, whether or not
exempt from registration under the securities laws of the United States; and
WHEREAS, the Board of Directors desires to restate and replace the
matters authorized under the Shelf Resolution with the resolutions contained
herein which shall apply to both the Available Shelf Securities and the New
Shelf Securities (referred to collectively herein as "securities"); and
WHEREAS, the Board of Directors deems it advisable to authorize and
approve certain actions to be taken in connection with the issuance and sale of
the securities.
.........................................
RESOLVED, that the Corporation is hereby authorized to issue, from time
to time, in one or more offerings, pursuant to either a registration statement
under the securities laws of the United States or an exemption therefrom,
whether for private offerings or exempt foreign offerings, the Available Shelf
Securities and New Shelf Securities with an aggregate issue price of up to
$1,261,500,000. The securities may be either: (a) debt securities ("Debt
Securities") which may be either senior or subordinated indebtedness, including
without limitation, medium-term notes; (b) warrants to purchase Debt Securities
("Debt Warrants"); (c) Common Shares with a par value of $1.00 each of the
Corporation ("Common Shares") accompanied by rights to purchase Common Shares
("Rights") under the Corporation's Rights Agreement, dated August 25, 1989, as
amended; (d) shares of the Corporation's preferred stock with a par value of
$1.00 each ("Preferred Stock"), which may be issued in the form of depositary
shares ("Depositary Shares") evidenced by depositary receipts; (e) warrants to
purchase Common Shares, Preferred Stock, or Depositary Shares ("Stock
Warrants"), or any combination of the foregoing, either individually or as units
consisting of one or more securities. Any issue of
1
<PAGE> 3
subordinated Debt Securities (the "Subordinated Debt Securities") may be
exchangeable for Common Shares or Preferred Stock ("Capital Securities"), and
any issue of Preferred Stock may be exchangeable for any class or series of
Capital Securities, or other debt securities of the Corporation. The
Subordinated Debt Securities may be subject to conversion by the Corporation
into Capital Securities of the Corporation. Preferred Stock may be subject to
conversion by the Corporation into any class or series of Capital Securities.
The Debt Securities, the Preferred Stock, the Depositary Shares, and the Common
Shares are hereinafter referred to collectively as "Warrant Exercise Items". The
Debt Warrants and the Stock Warrants are collectively referred to as the
"Warrants" and the Debt Securities, Warrants, Common Shares, Rights, Preferred
Stock, and Depositary Shares are collectively referred to herein as
"Securities". The Securities may be offered and sold in either a single offering
or a series of offerings in the United States or elsewhere, may be denominated
when issued in U.S. dollars or any foreign currency, currency unit, or composite
currency ("Currency") and may be issued on such terms as hereafter shall be
determined, in accordance with these resolutions or otherwise, by this Board of
Directors.
........................................
RESOLVED, that the Executive Committee of the Board of Directors or, if
and to the full extent permissible under law, any one of the Chief Executive
Officer, Chief Financial Officer, the Chief Investment Officer, and the
Treasurer, each of the Corporation, the Senior Vice President of KeyBank
National Association with responsibility for funds management, and the Vice
President of KeyCorp Management Company with responsibility for capital planning
functions (each, an "Authorized Pricing Official") is hereby authorized, in the
name and on behalf of the Corporation, subject to the limitations set forth in
these resolutions, to exercise all of the authority of the Board of Directors in
connection with the authorization and issuance of Securities. Within the
limitations specified in these resolutions, the Executive Committee of the Board
of Directors or, if and to the full extent permissible under law, an Authorized
Pricing Official is hereby authorized and empowered to approve, for and on
behalf of the Corporation:
(A) FOR EACH ISSUANCE OF SECURITIES: (i) the underwriter(s) or
dealer(s), if any, to which such Securities are to be sold, or the
agent(s), if any, for such sales by the Corporation of such Securities;
(ii) the price (or a range of prices) to be paid by underwriters or
dealers, if any, or the offering prices (or a range of offering prices)
to other purchasers and any discount (or a range of discounts) to be
received by or commission (or a range of commissions) paid to, any
underwriters, dealers, or sales agents; (iii) the Currency in which the
Securities are to be denominated; (iv) the date on which such
Securities shall be issued and sold; (v) any trustees, security
registrars, authenticating or paying agents, exchange agents, or
transfer agents; and (vi) any and all other terms and conditions of
such Securities as the Executive Committee or, if and to the full
extent permissible under law, an Authorized Pricing Official,
determines to establish or to authorize any Authorized Official to
establish within a range of choices established by the Executive
Committee or an Authorized Pricing Official, as the case may be,
including without limitation:
2
<PAGE> 4
(A) FOR EACH ISSUANCE OF PREFERRED STOCK: (1) the designation
of each series, which may be by distinguishing number, letter,
or title; (2) the authorized number of shares of each series;
(3) the dividend rate or rates of the shares of each series;
(4) the dates on which dividends, if declared, shall be
payable, and in the case of series on which dividends are
cumulative, the dates from which dividends shall be
cumulative; (5) the redemption rights and price or prices, if
any, for shares of each series; (6) the amount, terms,
conditions, and manner of operation of any retirement or
sinking fund to be provided for the purchase or redemption of
shares of each series; (7) the amounts payable on shares of
each series in the event of any voluntary or involuntary
liquidation, dissolution, or winding up of the affairs of the
Corporation; (8) the authorization of Depositary Shares and
the issuance of depositary receipts, if any, including the
determination of the fractional interest in a share of
Preferred Stock represented by each depositary receipt, as
well as the terms and conditions of any related agreement, the
selection of a depositary, and the fees and expenses of such
depositary; (9) the restrictions, if any, upon the issuance of
any additional shares of the same series or of any other class
or series; (10) the appointment of any registrar and transfer
agent for the registration, transfer, and exchange of the
Preferred Stock and the appointment of a dividend disbursing
and withholding agent, if any, for the Preferred Stock; (11)
the terms of conversion if such shares of Preferred Stock are
convertible into other Capital Securities of the Corporation;
and (12) all other terms and conditions of the Preferred
Stock;
(B) FOR EACH ISSUANCE OF DEBT SECURITIES: (1) the form(s) of
such Debt Securities; (2) the title of such Debt Securities
and whether such Debt Securities are senior or subordinated;
(3) the terms of subordination of the Subordinated Debt
Securities; (4) any limit upon the aggregate principal amount
of such Debt Securities that may be authenticated and
delivered under the applicable indenture; (5) the date or
dates, or the methods by which such date or dates will be
determined or extended, on which the principal of such Debt
Securities shall be payable; (6) the rate or rates at which
such Debt Securities shall bear interest, if any, or the
methods by which such rate or rates shall be determined, the
date or dates from which such interest, if any, shall accrue
or the methods by which such date or dates shall be
determined, the date or dates on which such interest, if any,
will be payable and the record date or dates, if any, for the
interest payable on any registered Debt Security on any
interest payment date, or the methods by which such date shall
be determined, and the basis upon which interest shall be
calculated if other than that of a 360-day year of twelve
30-day months; (7) the maturity date of such Debt Securities;
(8) the period or periods within which, the price or prices at
which, the Currency or Currencies in which, and other terms
and conditions upon which, such Debt Securities may be
redeemed, in whole or in part, at the option of the
Corporation, and whether the Corporation is to have the
option; (9) if such Debt Securities are to be convertible into
3
<PAGE> 5
Capital Securities of the Corporation, the terms upon which
such Debt Securities will be converted into Capital Securities
of the Corporation; and (10) all other terms and conditions of
such Debt Securities; and
(C) FOR EACH ISSUANCE OF WARRANTS: (1) the designation,
aggregate amounts, price, and terms of the Warrants and the
Warrant Exercise Items which may be issued or sold upon the
exercise of such Warrants; (2) the designation and terms of
any related Securities with which such Warrants may be issued
and the number of such Warrants issued with each such
Security; (3) the designation, number, purchase price, and
terms of the Warrant Exercise Items purchasable upon the
exercise of the Warrants; (4) the date, if any, on and after
which such Warrants and the related Securities will be
separately transferable; (5) the principal or other amount of
Warrant Exercise Items which may be purchased or sold upon
exercise of each Warrant and the price at which such principal
or other amount of Warrant Exercise Items may be purchased or
sold upon such exercise; (6) the date on which the right to
exercise such Warrants shall commence and the date on which
such right shall expire; and (7) all other terms and
conditions of the Warrants;
and the Executive Committee or an Authorized Pricing Official, as appropriate,
is hereby authorized, in the name and on behalf of the Corporation, to take any
and all such action to do, or authorize to be done, all such things as the
Executive Committee or such Authorized Pricing Official may deem necessary and
appropriate to effectuate the purposes of these resolutions.
FURTHER RESOLVED, that, with respect to the issuance and sale of the
Securities, the Executive Committee or, if and to the full extent permissible
under law, an Authorized Pricing Official is authorized: (a) to reserve for
issuance out of the Corporation's authorized but unissued Common Shares and
Preferred Stock such number of shares as shall be issuable upon conversion of
all Debt Securities into such Capital Securities in accordance with the terms of
the applicable indenture; (b) to reserve for issuance out of the Corporation's
authorized but unissued Common Shares such number of shares as shall be issuable
upon conversion of all Preferred Stock into such Common Shares in accordance
with the express terms of the applicable class of Preferred Stock; and (c) to
issue such reserved Common Shares or shares of Preferred Stock.
........................................
RESOLVED, that each of the Authorized Pricing Officials, the Senior
Executive Vice President and Chief Administrative Officer, the General Counsel,
and the Deputy General Counsel, each of the Corporation, and the Senior Vice
President and Senior Managing Counsel of KeyCorp Management Company with
responsibility for mergers and acquisitions, securities, and capital markets
matters of the Corporation (each, an "Authorized Official"), or any other
officer of the Corporation or any affiliate thereof, designated by any one of
them, are hereby
4
<PAGE> 6
authorized, for and on behalf of the Corporation, to take the following actions
with respect to the issuance and sale of Securities:
(a) in connection with the proposed sale of Debt Securities, to execute
and deliver one or more trust indentures or fiscal agency agreements,
including any amendment or supplements thereto with such trustees or
fiscal agents as shall be selected by an Authorized Official, or any
other officer designated by an Authorized Official, signing such
indenture, in such form and with such provisions as such Authorized
Official or other officer executing such document shall approve;
(b) in connection with any proposed sale of Preferred Stock, to execute
and cause to be filed with the Secretary of State of the State of Ohio
a Certificate of Amendment of the Amended and Restated Articles of
Incorporation of the Corporation relating to each series of the
Preferred Stock, with a par value of $1.00 each, of the Corporation,
setting forth the initial number of shares and the designation,
relative rights, preferences and limitations, to the extent not set
forth in Part B of Article IV of the Amended and Restated Articles of
Incorporation, of each series of Preferred Stock, as provided in these
resolutions and in the Certificate of Amendment as so filed;
(c) to execute and deliver forms of certificates evidencing the Debt
Securities, Preferred Stock, Depositary Shares, Common Shares, or
Warrants which signatures may be facsimiles (if an Authorized Official,
or any other officer of the Corporation or an affiliate thereof
designated by an Authorized Official, whose manual or facsimile
signature appears on any of such certificates ceases to be such an
officer of the Corporation or an affiliate thereof prior to the
issuance of such certificate, such certificates shall nevertheless be
valid);
(d) in connection with the registration with the Commission and the
public offering and sale of the Securities by such underwriters or
agents as are selected by the Executive Committee or an Authorized
Pricing Official, as appropriate, to (i) approve and authorize the form
of underwriting agreement or distribution agreement setting forth,
among other things, (A) the terms of the public offering and sale, (B)
the Corporation's representations, warranties, and agreements with
respect to the filing with the Commission of a registration statement
on Form S-3 (or such other form or forms as are applicable) under the
Securities Act of 1933, as amended (the "Securities Act"), and (C) the
agreement of the Corporation to indemnify the underwriters or agents
against certain losses or liabilities which may arise out of actual, or
alleged misstatements of material facts or actual or alleged omissions
to state material facts, in such a Registration Statement, and (ii)
negotiate, execute, deliver, and perform such underwriting agreement or
distribution agreement;
(e) if he or she deems it advisable, (i) to apply for listing on the
New York Stock Exchange of all or part of the Securities; (ii) to
execute and file in the name and on behalf of the Corporation any
applications on Form 8-A or on any amendment to any Form 8-A
theretofore filed for the registration of all or part of the Securities
under the
5
<PAGE> 7
Securities Exchange Act of 1934, as amended, in connection with the
listing of such Securities on a national securities exchange and any
other documents or agreements which may be necessary or desirable (in
the opinion of the executing officer as evidenced by such execution) to
effect such listing; and (iii) to appear or authorize representatives
to appear on behalf of the Corporation, if required, before the
committee on listing of such exchange;
(f) to execute one or more warrant agreements relating to Warrants in
such form as an Authorized Official, or any other officer of the
Corporation or any affiliate thereof designated by an Authorized
Official, executing such agreements shall approve;
(g) to negotiate and establish a form of depositary agreement for
shares of Preferred Stock of which Depositary Shares shall be sold and
to execute one or more depositary agreements substantially in such
form, with such changes or amendments thereto as an Authorized
Official, or any other officer of the Corporation or any affiliate
thereof designated by an Authorized Official, executing the same may
deem necessary or advisable;
(h) to enter into such agreements with a third party or parties as are
necessary to provide interest rate protection to the Corporation
relating to the issuance of the Securities (or a portion thereof) for
such period or periods and pursuant to such other terms and conditions
as an Authorized Pricing Official, or any other officer of the
Corporation or any affiliate thereof designated by an Authorized
Official, may deem necessary or advisable, including future, hedging,
or other transactions;
(i) to take any and all actions as such Authorized Official may deem
necessary or desirable to effect the global issuance and sale of the
Securities, including but not limited to the appointment of and
negotiation of agreements with Euroclear System and Cedel, societe
anonyme, the issuance of Debt Securities in registered or bearer form,
and any and all other actions for the authorization and issuance of
Securities pursuant to a registration statement filed with the
Commission or an exemption therefrom; and
(j) to negotiate, prepare or cause to be prepared, execute, and deliver
all other agreements or documents as an Authorized Official, or any
other officer of the Corporation or any affiliate thereof designated by
an Authorized Official, may deem necessary or desirable in order to
implement or effect any of the resolutions contained herein.
........................................
RESOLVED, that, with respect to registration of the Securities, each of
the Authorized Officials or any other officer of the Corporation or any
affiliate thereof designated by any one of them is hereby authorized, for and on
behalf of the Corporation, to take the following actions:
6
<PAGE> 8
(a) prepare or cause to be prepared amendments to the KeyCorp
Registration Statement or one or more new registration statements on
Form S-3 (or such other form or forms as are applicable) to be filed
with the Commission under the Securities Act, pursuant to Rule 415
thereunder, for the purpose of registering the offering of the
additional amount of Securities authorized by these resolutions on a
delayed or continuous basis, and any amendments, post-effective
amendments, or supplements thereto, and exhibits and other documents in
connection therewith; and, in order to carry out such actions, each of
the Authorized Officials is hereby appointed as the attorney of the
Corporation, with full power of substitution and resubstitution, for
and in the name, place, or stead of the Corporation, to sign and file
(i) any registration statement on Form S-3 (or on such other form or
forms as applicable), (ii) any and all amendments, post-effective
amendments, or supplements thereto, and exhibits, and (iii) any and all
applications and other documents to be filed with the Commission
pertaining to the Securities or such registration, with full power and
authority to do and perform any and all such acts and things whatsoever
requisite and necessary to effect such registration;
(b) to take any action which any of them may deem necessary or
advisable to effect the registration or qualification of the Securities
under the securities or blue sky laws of any of the States of the
United States of America or to carry out such offering, and, in
connection therewith, to execute, acknowledge, verify, deliver, file,
and publish all such applications, reports, issuer's covenants,
resolutions, and other papers and instruments, to post bonds or
otherwise give security as may be required under such laws and to take
all such further action as any of them may deem necessary or advisable
in order to maintain any such registration or qualification for as long
as an Authorized Official, or any other officer of the Corporation or
an affiliate thereof designated by an Authorized Official, may deem to
be in the best interests of the Corporation;
(c) to execute and file irrevocable written consents to service of
process in all States of the United of America where such consents may
be required or advisable under the securities law thereof in connection
with the registration or qualification of the Securities, and to
appoint the appropriate person as agent of the Corporation for the
purpose of receiving and accepting such process; and
(d) to include the Debt Securities, if any, under one or more new
indentures or the existing Debt Securities Indenture dated as of June
10, 1994, between the Corporation and Bankers Trust Company, as
Trustee, or, in the case of Subordinated Debt Securities, the
Subordinated Debt Securities Indenture dated as of June 10, 1994,
between the Corporation and Bankers Trust Company.
........................................
RESOLVED, that any form of additional resolution or resolutions
required by law or regulation in connection with the foregoing resolutions be
and hereby are adopted, and that the Secretary or any Assistant Secretary of the
Corporation be and each of them hereby is
7
<PAGE> 9
authorized to certify as having been adopted by the Board of Directors of the
Corporation any such form of resolution, and a copy of each form of resolution
so certified shall be attached to the minutes of this meeting.
FURTHER RESOLVED, that each Authorized Official of the Corporation be
and each of them is hereby authorized to take any and all action as may be
necessary or advisable to carry out the intent and purposes of the foregoing
resolutions, and that the signature of any such Authorized Official to any
document shall be conclusive as to the approval of the Corporation and this
Board of Directors of the form and substance of such written instrument.
8
<PAGE> 1
Exhibit (25)
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT
TO SECTION 305(b)(2) ___________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
---------------------------------
KEYCORP
(Exact name of obligor as specified in its charter)
OHIO 34-6542451
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
127 PUBLIC SQUARE
CLEVELAND, OHIO 44114
(Address of principal executive offices) (Zip Code)
===========================
DEBT SECURITIES
(Title of the indenture securities)
- --------------------------------------------------------------------------------
<PAGE> 2
-2-
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising
authority to which it is subject.
<TABLE>
<CAPTION>
NAME ADDRESS
---- -------
<S> <C>
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
</TABLE>
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each
such affiliation.
None.
ITEM 3. -15. NOT APPLICABLE
ITEM 16. LIST OF EXHIBITS.
EXHIBIT 1 - Restated Organization Certificate of
Bankers Trust Company dated August 7, 1990
and Certificate of Amendment of the
Organization Certificate of Bankers Trust
Company dated June 21, 1995 - Incorporated
herein by reference to Exhibit 1 filed with
Form T-1 Statement, Registration No.
33-65171.
EXHIBIT 2 - Certificate of Authority to commence
business - Incorporated herein by reference
to Exhibit 2 filed with Form T-1 Statement,
Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise
corporate trust powers - Incorporated herein
by reference to Exhibit 2 filed with Form
T-1 Statement, Registration No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust
Company, dated as amended on October 19,
1995. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement,
Registration No. 33-65171.
<PAGE> 3
-3-
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company
required by Section 321(b) of the Act. -
Incorporated herein by reference to Exhibit
4 filed with Form T-1 Statement,
Registration No. 22-18864.
EXHIBIT 7 - A copy of the latest report of condition of
Bankers Trust Company dated as of
March 31, 1996.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, a corporation organized and
existing under the laws of the State of New York, has duly caused this statement
of eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York, and State of New York, on the 6th day
of August, 1996.
BANKERS TRUST COMPANY
By: /s/ Kevin Weeks
_______________________________
Kevin Weeks
Assistant Treasurer
<PAGE> 5
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 3/31/96 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS MARCH 31, 1996
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, reported the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
----------------
| C400 |
---------------------------
Dollar Amounts in Thousands |CFD Bil Mil Thou |
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS | / / / / / / / / / / / |
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / |
a. Noninterest-bearing balances and currency and coin(1) ..................... |0081 1,145,000|1.a.
b. Interest-bearing balances(2) .............................................. |0071 1,403,000|1.b.
2. Securities: | / / / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ................ |1754 0 |2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)............... |1773 3,535,000|2.b.
3 Federal funds sold and securities purchased under agreements to resell in domestic offices | / / / / / / / / / / / |
of the bank and of its Edge and Agreement subsidiaries, and in IBFs: | / / / / / / / / / / / |
a. Federal funds sold ......................................................... |0276 3,190,000|3.a.
b. Securities purchased under agreements to resell ............................ |0277 2,242,000|3.b.
4. Loans and lease financing receivables: |/ / / / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 24,678,000 |/ / / / / / / / / / / / |4.a.
b. LESS: Allowance for loan and lease losses.....................RCFD 3123 938,000 |/ / / / / / / / / / / / |4.b.
c. LESS: Allocated transfer risk reserve ........................RCFD 3128 0 |/ / / / / / / / / / / / |4.c.
d. Loans and leases, net of unearned income, |/ / / / / / / / / / / / |
allowance, and reserve (item 4.a minus 4.b and 4.c) ....................... |2125 23,740,000|4.d.
5. Assets held in trading accounts ................................................. |3545 32,261,000|5.
6. Premises and fixed assets (including capitalized leases) ........................ |2145 857,000|6.
7. Other real estate owned (from Schedule RC-M) .................................... |2150 247,000|7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) |2130 253,000|8.
9. Customers' liability to this bank on acceptances outstanding .................... |2155 402,000|9.
10. Intangible assets (from Schedule RC-M) .......................................... |2143 12,000|10.
11. Other assets (from Schedule RC-F) ............................................... |2160 11,579,000|11.
12. Total assets (sum of items 1 through 11) ........................................ |2170 80,866,000|12.
---------------------------
<FN>
- --------------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held in trading accounts.
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 3/31/96 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State ZIP: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
SCHEDULE RC--CONTINUED ---------------------------
Dollar Amounts in Thousands |/ / / / Bil Mil Thou |
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
LIABILITIES |/ / / / / / / / |
13. Deposits: |/ / / / / / / / |
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) |RCON 2200 7,327,000 |13.a.
(1) Noninterest-bearing(1).......................RCON 6631 2,132,000.......... |/ / / / / / / / |13.a.(1)
(2) Interest-bearing .............................RCON 6636 5,195,000.......... |/ / / / / / / / |13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E |/ / / / / / / / |
part II) |RCFN 2200 18,575,000 |13.b.
(1) Noninterest-bearing .........................RCFN 6631 552,000 |/ / / / / / / / |13.b.(1)
(2) Interest-bearing ............................RCFN 6636 18,023,000 |/ / / / / / / / |13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase in |/ / / / / / / / |
domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: |/ / / / / / / / |
a. Federal funds purchased ...................................................... |RCFD 0278 2,324,000 |14.a.
b. Securities sold under agreements to repurchase ............................... |RCFD 0279 651,000 |14.b.
15. a. Demand notes issued to the U.S. Treasury ..................................... |RCON 2840 0 |15.a.
b. Trading liabilities .......................................................... |RCFD 3548 18,807,000 |15.b.
16. Other borrowed money: |/ / / / / / / / / |
a. With original maturity of one year or less ................................... |RCFD 2332 13,784,000 |16.a.
b. With original maturity of more than one year ................................. |RCFD 2333 3,462,000 |16.b.
17. Mortgage indebtedness and obligations under capitalized leases .................... |RCFD 2910 34,000 |17.
18. Bank's liability on acceptances executed and outstanding .......................... |RCFD 2920 415,000 |18.
19. Subordinated notes and debentures ................................................. |RCFD 3200 1,227,000 |19.
20. Other liabilities (from Schedule RC-G) ............................................ |RCFD 2930 9,724,000 |20.
21. Total liabilities (sum of items 13 through 20) .................................... |RCFD 2948 76,330,000 |21.
|/ / / / / / / / / / / |
22. Limited-life preferred stock and related surplus .................................. |RCFD 3282 0 |22.
EQUITY CAPITAL |/ / / / / / / / / / / |
23. Perpetual preferred stock and related surplus ..................................... |RCFD 3838 500,000 |23.
24. Common stock ...................................................................... |RCFD 3230 1,002,000 |24.
25. Surplus (exclude all surplus related to preferred stock) .......................... |RCFD 3839 528,000 |25.
26. a. Undivided profits and capital reserves ....................................... |RCFD 3632 2,879,000 |26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities ....... |RCFD 8434 ( 8,000) |26.b.
27. Cumulative foreign currency translation adjustments ............................... |RCFD 3284 ( 365,000) |27.
28. Total equity capital (sum of items 23 through 27) ................................. |RCFD 3210 4,536,000 |28.
29. Total liabilities, limited-life preferred stock, and equity capital (sum of items |/ / / / / / / / / / / |
21, 22, and 28) ................................................................... |RCFD 3300 80,866,000 |29.
---------------------------
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1994 ...........................................................|RCFD 6724 2 |M.1
-------------------------
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
<FN>
- ----------------------
(1) Including total demand deposits and noninterest-bearing time and savings deposits.
</TABLE>
