<PAGE>
<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 1, 1996
REGISTRATION NO. 333-12071
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
LEUCADIA NATIONAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
NEW YORK 13-2615557
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
315 PARK AVENUE SOUTH
NEW YORK, N.Y. 10010-3607
(212) 460-1900
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
JOSEPH A. ORLANDO
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
LEUCADIA NATIONAL CORPORATION
315 PARK AVENUE SOUTH
NEW YORK, N.Y. 10010-3607
(212) 460-1900
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
STEPHEN E. JACOBS, ESQ. GERALD S. TANENBAUM, ESQ.
WEIL, GOTSHAL & MANGES LLP CAHILL GORDON & REINDEL
767 FIFTH AVENUE 80 PINE STREET
NEW YORK, NEW YORK 10153 NEW YORK, NEW YORK 10005
(212) 310-8000 (212) 701-3000
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
------------------------
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, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
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(c)
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 Rule 434,
please check the following box. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES 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 OF 1933 OR UNTIL THE REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE
COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
________________________________________________________________________________
<PAGE>
<PAGE>
<PAGE>
SUBJECT TO COMPLETION, DATED OCTOBER 1, 1996
PROSPECTUS
$135,000,000
LEUCADIA NATIONAL CORPORATION
% SENIOR SUBORDINATED NOTES DUE 2006
(Interest payable and )
------------------------
The Notes will bear interest from the date of their original issue, at the
rate per annum set forth above, payable semiannually on each and
, commencing , 1997. The Notes will mature on
, 2006 and are not redeemable by the Company prior to maturity.
Upon a Change of Control (as defined), each Noteholder will have the right,
subject to certain conditions and restrictions, to require the Company to
repurchase the Notes at 101% of the principal amount thereof, plus accrued
interest.
The Notes will be subordinated to all Senior Indebtedness (as defined) of
the Company. At June 30, 1996, the Company's Senior Indebtedness was
$150,000,000 and the indebtedness of the Company's consolidated subsidiaries, to
which the Notes are effectively subordinated, was $21,939,000, exclusive of
customer banking deposits ('Deposits'). The Notes will rank pari passu with the
Company's 8 1/4% Senior Subordinated Notes due 2005, of which, at June 30, 1996,
$100,000,000 aggregate principal amount was outstanding, and any 10 3/8% Senior
Subordinated Notes due 2002 (the '10 3/8% Notes') that remain outstanding after
the Tender Offer (as defined), of which, at June 30, 1996, $125,000,000
aggregate principal amount was outstanding.
The Company has commenced a cash tender offer (the 'Tender Offer') for all
of the $125,000,000 outstanding aggregate principal amount of the 10 3/8% Notes
at a price of $1,072.50 per $1,000 principal amount, plus accrued interest
thereon to, but not including, the payment date for the 10 3/8% Notes pursuant
to the Tender Offer. This offering is contingent upon not less than 80% of the
outstanding principal amount of 10 3/8% Notes being validly tendered and not
withdrawn pursuant to the Tender Offer. The net proceeds of this offering will
be used to purchase 10 3/8% Notes tendered pursuant to the Tender Offer. See
'Use of Proceeds.' The Company may reduce the aggregate principal amount of
Notes actually offered hereunder if less than all of the outstanding 10 3/8%
Notes are tendered in the Tender Offer.
------------------------
Application to list the Notes on the New York Stock Exchange under the
symbol 'LUK/06' has been approved.
------------------------
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.
------------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2) COMPANY(3)
------------- ----------- ------------
<S> <C> <C> <C>
Per Note.............................................................. % % %
Total................................................................. $ $ $
</TABLE>
- ------------
(1) Plus accrued interest, if any, from the date of original issue of the Notes.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See 'Underwriting.'
(3) Before deducting expenses payable by the Company estimated at $ .
------------------------
The Notes are offered by the Underwriters, subject to prior sale, when, as
and if issued to and accepted by them, and subject to approval of certain legal
matters by counsel for the Underwriters. It is expected that delivery of the
Notes will be made against payment therefor in New York, New York on or about
, 1996.
------------------------
JEFFERIES & COMPANY, INC. CS FIRST BOSTON
, 1996
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.
<PAGE>
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the 'Exchange Act'), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the 'Commission'). The reports, proxy
statements and other information filed by the Company with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the Commission's Regional Offices at 7 World Trade Center, 13th Floor, New York,
New York 10048 and Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511. Copies of such material also can be obtained
from the Public Reference Section of the Commission, Washington, D.C. 20549 at
prescribed rates. The Commission maintains a site on the World Wide Web that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission at
http://www.sec.gov. In addition, material filed by the Company can be inspected
at the offices of the New York Stock Exchange, Inc. (the 'NYSE'), 20 Broad
Street, New York, New York 10005 and the Pacific Stock Exchange, Incorporated,
301 Pine Street, San Francisco, California 94104, on which the Company's common
shares, par value $1.00 per share (the 'Common Shares'), are listed.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with any amendments thereto, the 'Registration Statement') under
the Securities Act of 1933, as amended (the 'Securities Act'), with respect to
the securities offered hereby. This Prospectus does not contain all the
information set forth in the Registration Statement. Such additional information
may be obtained from the Commission's principal office in Washington, D.C.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents which have been filed by the Company (File No.
1-5721) with the Commission are incorporated by reference in this Prospectus:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995 (the 'Annual Report');
(b) the Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended March 31, 1996; and
(c) the Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1996 (the 'Second Quarter 10-Q').
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the Notes contemplated hereby shall be deemed to
be incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated by reference or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for all purposes of this Prospectus to
the extent that a statement contained herein or in any subsequently filed
document which also is incorporated or deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of
this Prospectus has been delivered, on the written or oral request of such
person, a copy of any and all of the documents referred to above which have been
or may be incorporated in this Prospectus by reference, other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
therein. Requests for such copies should be directed to: Leucadia National
Corporation, 315 Park Avenue South, New York, N.Y. 10010 (telephone number (212)
460-1900), Attention: Corporate Secretary.
------------------------
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE NOTES OFFERED
HEREBY AND THE COMPANY'S OUTSTANDING 8 1/4% SENIOR SUBORDINATED NOTES DUE 2005,
10 3/8% SENIOR SUBORDINATED NOTES DUE 2002 AND 7 3/4% SENIOR NOTES DUE 2013 AT
LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
FOR NORTH CAROLINA RESIDENTS: THE COMMISSIONER OF INSURANCE OF THE STATE OF
NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE
COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
2
<PAGE>
<PAGE>
PROSPECTUS SUMMARY
This summary is qualified in its entirety by the detailed information
appearing elsewhere or incorporated by reference in this Prospectus. As used
herein, the term 'Company' means Leucadia National Corporation and its
subsidiaries, except as the context otherwise may require.
THE OFFERING
<TABLE>
<S> <C>
Issue........................................ $135,000,000 principal amount of % Senior Subordi-
nated Notes due 2006 (the 'Notes').
Maturity..................................... , 2006.
Interest Rate................................ % per annum.
Interest Payment Dates....................... and , commencing
, 1997.
Optional Redemption.......................... The Notes are not redeemable at the option of the Company prior to
maturity.
Mandatory Redemption......................... The Notes are not subject to sinking fund payments.
Certain Covenants............................ The indenture under which the Notes will be issued (the
'Indenture') will contain covenants which, among other things,
place restrictions on the ability of the Company and its
subsidiaries to incur additional indebtedness, to make certain
investments, to redeem or repurchase shares of capital stock of
the Company and to enter into certain transactions with
affiliates, on the ability of the Company's insurance
subsidiaries to invest in non-investment grade investments and
on the ability of the Company to pay dividends and to consummate
certain mergers. In addition, if the Company's Consolidated
Tangible Net Worth (as defined) is below a certain level at the
end of two consecutive fiscal quarters, the Company will be
required, under certain circumstances, to offer to repurchase a
portion of the Notes at 100% of their principal amount, plus
accrued but unpaid interest to the repurchase date. In the event
of a Change of Control (as defined) of the Company, each holder
of a Note (a 'Noteholder') will have the right, subject to
certain exceptions, to require the Company to repurchase all or
any portion of such Noteholder's Notes at 101% of the principal
amount thereof, plus accrued but unpaid interest to the date of
such repurchase.
Ranking...................................... The Notes will be subordinated to all existing and future Senior
Indebtedness. At June 30, 1996, the Company's Senior
Indebtedness was $150,000,000 and the indebtedness of the
Company's consolidated subsidiaries, to which the Notes are
effectively subordinated, was $21,939,000, exclusive of
Deposits. The Notes will rank pari passu with the Company's
8 1/4% Senior Subordinated Notes due 2005 (the '8 1/4% Notes'),
of which, at June 30, 1996, $100,000,000 aggregate principal
amount was outstanding, and any 10 3/8% Notes that remain
outstanding after completion of the Tender Offer, of which, at
June 30, 1996, $125,000,000 was outstanding. The Notes will rank
senior to the Company's 5 1/4% Convertible Subordinated
Debentures due 2003 (the '5 1/4% Debentures'), of which
$100,000,000 aggregate principal amount was outstanding at June
30, 1996. The Company may not incur any indebtedness senior to
the Notes which is not Senior Indebtedness.
</TABLE>
3
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Listing...................................... Application to list the Notes on the NYSE under the symbol
'LUK/06' has been approved.
Use of Proceeds.............................. The net proceeds to the Company from the sale of the Notes are
estimated to be $ . Such net proceeds will be used to
purchase 10 3/8% Notes tendered pursuant to the Tender Offer. If
less than all of the outstanding 10 3/8% Notes are purchased
pursuant to the Tender Offer, the Company may reduce the
aggregate principal amount of Notes actually offered hereunder.
To the extent the net proceeds of the offering exceed the amount
necessary to purchase the 10 3/8% Notes tendered pursuant to the
Tender Offer, such excess net proceeds will be used for general
corporate purposes, which may include the purchase of 10 3/8%
Notes in the open market or in privately negotiated transactions
or the redemption of the 10 3/8% Notes (which are first
redeemable on June 15, 1997 at a price of 104.5% of their
principal amount, plus accrued and unpaid interest, if any, to
the date of redemption) or for working capital, acquisitions or
investment opportunities. See 'Use of Proceeds.'
</TABLE>
4
<PAGE>
<PAGE>
THE COMPANY
GENERAL
The Company is a diversified financial services holding company principally
engaged in personal and commercial lines of property and casualty insurance,
life and health insurance, banking and lending and manufacturing. The Company
concentrates on return on investment and cash flow to build long-term
shareholder value, rather than emphasizing volume or market share. Additionally,
the Company continuously evaluates the retention and disposition of its existing
operations and investigates possible acquisitions of new businesses in order to
maximize shareholder value.
Shareholders' equity has grown to $1,102,402,000 at June 30, 1996 from a
deficit of $7,657,000 at December 31, 1978 (prior to the acquisition of a
controlling interest in the Company by the Company's Chairman and President),
and book value per common share has grown to $18.28 at June 30, 1996 from
negative $.11 at December 31, 1978. The Company's Chairman and President and
their families currently beneficially own in the aggregate approximately 35% of
the Company's outstanding Common Shares.
The Company's principal operations are its insurance businesses, where it
is a specialty markets provider of property and casualty and life insurance
products to niche markets. The Company's principal personal lines insurance
products are automobile insurance, homeowners insurance, graded benefit life
insurance marketed primarily to the age 50-and-over population and variable
annuity products. The Company's principal commercial lines are property and
casualty products provided for multi-family residential real estate, retail
establishments and taxicabs and other livery vehicles in the New York
metropolitan area. For the year ended December 31, 1995, the Company's insurance
segments contributed 78% of total revenues and, at December 31, 1995,
constituted 77% of consolidated assets.
The property and casualty insurance industry, which is highly regulated and
competitive, has historically been cyclical in nature, with periods of less
intense price competition and high underwriting standards generating significant
profits, followed by periods of increased price competition and lower
underwriting standards resulting in reduced profitability or loss. The current
cycle of intense price competition has continued for a longer period than in the
past, suggesting that the significant infusion of capital into the industry in
recent years, coupled with larger investment returns has been, and may continue
to be, a depressing influence on policy rates. As indicated in the Selected
Financial Data included herein, the statutory combined ratios for the Company's
property and casualty business have been better than the industry averages for
each of the past five years. This has been due, in part, to the low expense
ratios of the Company's insurance subsidiaries.
The Company's insurance subsidiaries have a diversified investment
portfolio of securities, substantially all of which are issued or guaranteed by
the U.S. Treasury or by U.S. governmental agencies or are rated 'investment
grade' by Moody's Investors Service Inc. ('Moody's') and/or Standard & Poor's
Corporation ('S&P'). Investments in mortgage loans, real estate and
non-investment grade securities represented 2.5% of the insurance subsidiaries'
portfolio at December 31, 1995.
The Company's banking and lending operations principally consist of making
instalment loans to niche markets primarily funded by Deposits insured by the
Federal Deposit Insurance Company. One of the Company's principal lending
activities is providing automobile loans to individuals with poor credit
histories. The Company's manufacturing operations primarily manufacture products
for the 'do-it-yourself' home improvement market and for industrial markets.
At December 31, 1995, the Company had minimum tax loss carryforwards of
approximately $141,600,000. The amount and availability of the tax loss
carryforwards are subject to certain qualifications, limitations and
uncertainties as more fully discussed in Note 14 of Notes to Consolidated
Financial Statements contained in the Annual Report.
5
<PAGE>
<PAGE>
RECENT DEVELOPMENTS
The Company has commenced the Tender Offer to purchase for cash all of the
outstanding $125,000,000 aggregate principal amount of the 10 3/8% Notes at a
price of $1,072.50 per $1,000 principal amount, plus accrued interest thereon
to, but not including the payment date therefor. The Tender Offer is conditioned
upon, among other conditions, the consummation of this offering and the valid
tender (without withdrawal) of not less than 80% of the outstanding principal
amount of the 10 3/8% Notes, and will be funded by the application of the net
proceeds from this offering, which is intended to replace the indebtedness
represented by the 10 3/8% Notes with indebtedness bearing interest at a lower
rate and maturing at a later date.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Notes are estimated to
be $ . Such net proceeds will be used to purchase 10 3/8% Notes
tendered pursuant to the Tender Offer, of which $125,000,000 aggregate principal
amount is outstanding. If less than all of the outstanding 10 3/8% Notes are
purchased pursuant to the Tender Offer, the Company may reduce the aggregate
principal amount of Notes actually offered hereunder. To the extent the net
proceeds of the offering exceed the amount necessary to purchase the 10 3/8%
Notes tendered pursuant to the Tender Offer, such excess net proceeds will be
used for general corporate purposes, which may include the purchase of 10 3/8%
Notes in the open market or in privately negotiated transactions or the
redemption of the 10 3/8% Notes (which are first redeemable on June 15, 1997 at
a price of 104.5% of their principal amount, plus accrued and unpaid interest,
if any, to the date of redemption) or for working capital, acquisitions or
investment opportunities. The stated maturity of the 10 3/8% Notes is June 15,
2002. Except as otherwise publicly disclosed, the Company has no material
arrangement, commitment or understanding with respect to any acquisition or
investment opportunity. Pending such uses, the proceeds will be invested in
short-term investment grade obligations.
6
<PAGE>
<PAGE>
CAPITALIZATION
The following table sets forth the (unaudited) consolidated capitalization
of the Company at June 30, 1996, and as adjusted to give effect to the sale of
the Notes and the use of the net proceeds therefrom to purchase all outstanding
10 3/8% Notes pursuant to the Tender Offer.
<TABLE>
<CAPTION>
AS
ACTUAL ADJUSTED
---------- ----------
(IN THOUSANDS)
<S> <C> <C>
Long-term debt (a):
Revolving bank credit agreement borrowings....................................... $ -- $ --
Term loans with banks, due in 1999............................................... 50,000 50,000
7 3/4% Senior Notes due 2013, less debt discount of $856......................... 99,144 99,144
Industrial revenue bonds......................................................... 5,600 5,600
Other senior debt................................................................ 16,339 16,339
% Senior Subordinated Notes due 2006.......................................... -- 135,000
8 1/4% Senior Subordinated Notes due 2005........................................ 100,000 100,000
10 3/8% Senior Subordinated Notes due 2002, less debt
discount of $559............................................................... 124,441 --
5 1/4% Convertible Subordinated Debentures due 2003.............................. 100,000 100,000
---------- ----------
Total long-term debt, including current maturities.......................... 495,524 506,083
---------- ----------
Shareholders' Equity (b):
Common shares, par value $1 per share, authorized 150,000,000 shares; 60,316,825
shares issued and outstanding, after deducting shares held in treasury.......... 60,317 60,317
Additional paid-in capital....................................................... 160,506 160,506
Net unrealized (loss) on investments............................................. (8,522) (8,522)
Retained earnings................................................................ 890,101 881,582(c)
---------- ----------
Total shareholders' equity.................................................. 1,102,402 1,093,883
---------- ----------
Total.................................................................. $1,597,926 $1,599,966
---------- ----------
---------- ----------
</TABLE>
- ------------
(a) Excludes Deposits of approximately $211,020,000. For information with
respect to interest rates, maturities, priorities and restrictions related
to outstanding long-term debt and the Notes, see Note 10 of Notes to
Consolidated Financial Statements contained in the Annual Report and
'Description of Notes,' respectively.
(b) For information with respect to stock options and contingent obligations,
see Notes 11 and 17 of Notes to Consolidated Financial Statements contained
in the Annual Report.
(c) Reflects a $8,519,000 extraordinary loss, net of taxes, related to the
early extinguishment of the 10 3/8% Notes pursuant to the Tender Offer.
7
<PAGE>
<PAGE>
SELECTED FINANCIAL DATA
The selected financial data set forth below has been derived from and
should be read in conjunction with the audited financial statements and other
financial information contained in the Annual Report and with the unaudited
financial statements contained in the Second Quarter 10-Q, which are
incorporated by reference in this Prospectus.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
--------------------- ----------------------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
-------- -------- ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS AND RATIOS)
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED INCOME STATEMENT
DATA:(a)
Revenues................. $763,139 $737,445 $1,558,314 $1,384,385 $1,408,058 $1,573,015 $1,086,748
Net securities gains
(losses)............... 11,575 (228) 20,027 (12,004) 51,923 51,778 50,391
Interest expense(b)...... 27,282 24,405 52,871 44,003 39,465 38,507 36,925
Insurance losses, policy
benefits and
amortization of
deferred acquisition
costs.................. 486,284 452,428 942,803 819,010 789,752 896,673 558,127
Income before income
taxes and cumulative
effects of changes in
accounting
principles............. 40,422 47,703 132,182 100,318 176,868 143,553 95,030
Income before cumulative
effects of changes in
accounting
principles(c).......... 28,774 33,732 107,503 70,836 116,259 130,607 94,830
Cumulative effects of
changes in accounting
principles............. -- -- -- -- 129,195 -- --
Net income............... 28,774 33,732 107,503 70,836 245,454 130,607 94,830
Ratio of earnings to
fixed charges:(d)
Excluding interest on
Deposits............. 2.89x 3.20x 3.84x 3.49x 5.80x 5.24x 4.54x
Including interest on
Deposits............. 2.50x 2.75x 3.26x 3.08x 4.86x 4.14x 3.27x
Per share:
Primary earnings per
common and dilutive
common equivalent
share:
Income before
cumulative effects of
changes in accounting
principles........... $.48 $.58 $1.81 $1.22 $1.98 $2.67 $2.00
Cumulative effects of
changes in accounting
principles........... -- -- -- -- 2.21 -- --
Net income........... $.48 $.58 $1.81 $1.22 $4.19 $2.67 $2.00
Fully diluted earnings
per common share:
Income before
cumulative effects of
changes in accounting
principles........... $.48 $.57 $1.77 $1.21 $1.94 $2.66 $1.98
Cumulative effects of
changes in accounting
principles........... -- -- -- -- 2.10 -- --
Net income........... $.48 $.57 $1.77 $1.21 $4.04 $2.66 $1.98
Number of shares used in
calculation:
Primary................ 60,569 58,587 59,271 58,202 58,539 48,870 47,409
Fully Diluted.......... 60,569 62,140 62,807 61,715 61,486 49,032 47,835
</TABLE>
- ------------
Footnotes on following page.
8
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
AT JUNE 30, AT DECEMBER 31,
----------- ------------------------------------------------------------------
1996 1995 1994 1993 1992 1991
----------- ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C>
SELECTED BALANCE SHEET
DATA:(a)
Cash and investments..... $3,055,323 $3,146,639 $2,764,890 $2,989,384 $3,371,624 $3,627,542
Total assets............. 5,150,133 5,107,874 4,674,046 4,689,272 4,330,580 4,590,096
Debt, including current
maturities............. 495,524 520,862 425,848 401,335 225,588 220,728
Customer banking
deposits............... 211,020 203,061 179,888 173,365 186,339 194,862
Common shareholders'
equity................. 1,102,402 1,111,491 881,815 907,856 618,161 365,495
Book value per Common
Share.................. $18.28 $18.47 $15.72 $16.27 $11.06 $7.95
</TABLE>
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
--------------- ---------------------------------------------
1996 1995 1995 1994 1993 1992 1991
----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
SELECTED INFORMATION ON
PROPERTY
AND CASUALTY INSURANCE
OPERATIONS
(Unaudited):(a)(e)(f)
GAAP Combined Ratio...... 104.5% 102.2% 103.5% 99.1% 96.9% 101.7% 102.1%
SAP Combined Ratio....... 100.5% 99.4% 101.2% 98.8% 93.7% 102.8% 103.3%
Industry SAP Combined
Ratio(g)............... N/A 106.3% 106.4% 108.4% 106.9% 115.7% 108.8%
Premium to Surplus
Ratio(h)............... N/A N/A 1.8x 1.9x 1.6x 2.0x 2.2x
</TABLE>
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(a) Data includes acquired companies from date of acquisition.
(b) Includes interest on customer banking deposits of $12,034,000, $8,304,000,
$9,001,000, $11,954,000 and $15,138,000 for the years ended December 31,
1995, 1994, 1993, 1992 and 1991, respectively, and $6,322,000 and
$5,680,000 for the six month periods ended June 30, 1996 and 1995,
respectively.
(c) The provision for income taxes for the years ended December 31, 1995, 1994
and 1993 and for the six month periods ended June 30, 1996 and 1995 were
calculated under Statement of Financial Accounting Standards No. 109,
'Accounting for Income Taxes,' which does not reflect the benefit from
utilization of tax loss carryforwards. The provision for income taxes for
the years ended December 31, 1992 and 1991 have been reduced for the
benefit from utilization of tax loss carryforwards.
(d) For purposes of computing these ratios, earnings represent consolidated
pre-tax income before cumulative effects of changes in accounting
principles and equity in undistributed earnings or loss of less than 50%
owned companies, plus 'fixed charges.' Fixed charges excluding interest on
Deposits include interest expense (other than on Deposits), the portion of
net rental expense representative of the interest factor and amortization
of debt expense. Fixed charges including interest on Deposits include all
interest expense, the portion of net rental expense representative of the
interest factor and amortization of debt expense.
(e) Combined Ratios and the Premium to Surplus Ratios include both Colonial
Penn Group, Inc. and its subsidiaries for the relevant periods since August
16, 1991 and Empire Insurance Company.
(f) The Combined Ratio is the sum of the Loss Ratio and the Underwriting
Expense Ratio determined in accordance with generally accepted accounting
principles or statutory accounting principles ('SAP'), as the case may be.
The Loss Ratio is the ratio of incurred losses and loss adjustment expenses
to net premiums earned. The Expense Ratio is the ratio of underwriting
expenses (policy acquisition costs, commissions and a portion of
administrative, general and other expenses attributable to underwriting
operations) to net premiums written, if determined in accordance with SAP,
or to net premiums earned, if determined in accordance with generally
accepted accounting principles. A Combined Ratio under 100% indicates an
underwriting profit and a Combined Ratio above 100% indicates an
underwriting loss. The Combined Ratio does not include the effect of
investment income. Certain accident and health insurance business, which is
included in the statutory results of operations of the property and
casualty insurance segment and is reflected in the SAP Combined Ratio, is
reported in the life insurance segment for financial reporting purposes and
therefore is not included in the GAAP Combined Ratios reflected herein. For
the six month periods ended June 30, 1996 and 1995, the difference between
the GAAP Combined Ratio and the SAP Combined Ratio principally reflects
adjustments to SAP reinsurance reserves and, in 1996, the accounting for
certain expenses which are treated differently under SAP and generally
accepted accounting principles. For 1995, a change in the statutory
accounting treatment for retrospectively rated reinsurance agreements was
the principal reason for the difference between the GAAP Combined Ratio and
the SAP Combined Ratio. For 1993, the difference in the treatment of costs
for generally accepted accounting principles and SAP purposes was a
principal reason for the difference between the GAAP Combined Ratio and the
SAP Combined Ratio. For 1992, the results of certain accident and health
insurance business had a non-recurring income item which reduced the SAP
Combined Ratio. In addition, in 1992, certain income credits were
recognized only for generally accepted accounting principles purposes.
(g) Source: Best's Aggregate & Averages, Property/Casualty, 1996 edition, with
respect to annual information for 1991 through 1995, and Best Week P/C
Supplement, September 18, 1995 Release 12, with respect to interim
information for 1995. Industry Combined Ratios may not be fully comparable
as a result of, among other things, differences in geographical
concentration and in the mix of property and casualty insurance products.
(h) The Premium to Surplus Ratio was calculated by dividing statutory property
and casualty insurance premiums written by statutory capital at the end of
the year.
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DESCRIPTION OF NOTES
The Notes are to be issued under an Indenture to be dated as of
, 1996, between the Company and Fleet National Bank, as Trustee
(the 'Trustee').
The statements herein relating to the Notes and the Indenture are summaries
and make use of defined terms in the Indenture, which are incorporated herein by
reference, and are qualified in their entirety by express reference to the
Indenture, a copy of which is filed as an exhibit to the Registration Statement
of which this Prospectus is a part.
GENERAL
The Notes will bear interest from the date of original issue at the rate
shown on the cover page of this Prospectus, payable on and
in each year to the Noteholders of record at the close of business
on the and immediately preceding such interest payment
date, commencing , 1997. The Notes will be due on ,
2006, will be issued only in denominations of $1,000 and integral multiples of
$1,000, and will be general unsecured obligations of the Company. The Indenture
authorizes an aggregate principal amount of $135,000,000 of the Notes.
OPTIONAL REDEMPTION
The Notes are not redeemable at the option of the Company prior to
maturity.
SINKING FUND
The Notes are not subject to sinking fund payments.
SUBORDINATION OF NOTES
The payment of all Obligations with respect to the Notes will be
subordinated in right of payment, as set forth in the Indenture, to the prior
payment in full of all Senior Indebtedness (as defined in the Indenture) of the
Company whether outstanding on the date of the Indenture or thereafter created,
incurred, assumed or guaranteed. Upon (a) the maturity of Senior Indebtedness by
lapse of time, acceleration or otherwise or (b) any distribution of the assets
of the Company upon any dissolution, winding up, liquidation or reorganization
of the Company, the holders of Senior Indebtedness will be entitled to receive
payment in full before the Noteholders are entitled to receive any payment. In
addition, the Indenture will provide that no payments in respect of any
Obligations with respect to the Notes may be made if (i) any payment default on
any Senior Indebtedness shall have occurred or (ii) any other default under any
Senior Indebtedness shall have occurred which would permit the holders thereof
to accelerate such Indebtedness and the Company shall have received notice of
such default, unless, in the case of clauses (i) or (ii), such default shall
have been cured or waived; provided, that (a) payments on the Notes may resume
in the case of any default described in clause (ii) on the date which is 179
days after the giving of such notice (provided there is not then a default under
clause (i)) and (b) in no event shall such payment blockage be applicable for
more than 179 days in each 360-day period. If in any of the situations referred
to in clause (i) or (ii) above a payment is made to the Trustee or to
Noteholders before all Senior Indebtedness has been paid in full or provision
has been made for such payment, the payment to the Trustee or Noteholders must
be paid over to the holders of the Senior Indebtedness.
The Indenture defines 'Senior Indebtedness' to mean all Obligations of the
Company with respect to the following, whether outstanding at the date of
original execution of the Indenture or thereafter incurred, created or assumed:
(a) indebtedness of the Company for money borrowed, including, without
limitation, indebtedness of the Company for money borrowed which is evidenced by
notes, debentures, bonds or other securities issued under the provisions of an
indenture or other instrument, and also including indebtedness represented by
Purchase Money Obligations (as defined), but only to the extent such
indebtedness is enforceable by a money judgment; (b) guarantees or assumptions
by the Company of indebtedness of others of any of the kinds described in the
preceding clause (a); and (c) renewals, extensions and refundings of, and
indebtedness of a successor corporation issued in exchange for or in
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replacement of, indebtedness, guarantees and assumptions of the kinds described
in the preceding clauses (a) or (b), unless, in the case of any particular
indebtedness, obligation, guarantee, assumption, renewal, extension or
refunding, the instrument creating or evidencing the same expressly provides
that such indebtedness, obligation, guarantee, assumption, renewal, extension or
refunding is not superior in right of payment to the Notes; provided, that
Senior Indebtedness shall not be deemed to include (i) any indebtedness of the
Company to any Subsidiary, (ii) any liability for taxes, (iii) any amounts
payable or other liabilities to trade creditors arising in the ordinary course
of business, (iv) any indebtedness which is subordinate or junior by its terms
to any other indebtedness of the Company, (v) the 8 1/4% Notes, (vi) the 10 3/8%
Notes or (vii) the 5 1/4% Debentures. At June 30, 1996, the amount of
outstanding Senior Indebtedness of the Company was $150,000,000 and the amount
of indebtedness of Subsidiaries of the Company, to which the Notes are
effectively subordinated, was $21,939,000, exclusive of $211,020,000 of
Deposits. The Indenture will provide that no indebtedness of the Company shall
be senior in right of payment to the Notes unless such indebtedness is pari
passu in right of payment with the Company's other Senior Indebtedness.
'Obligations' means any principal, interest, penalties, fees, indemnities
and other obligations and liabilities payable under the documentation governing
the applicable Indebtedness.
By reason of such subordination, in the event of insolvency, general
creditors of the Company may recover less, ratably, than holders of Senior
Indebtedness and may recover more, ratably, than Noteholders or holders of other
subordinated indebtedness of the Company.
The Notes will rank senior in right of payment to the 5 1/4% Debentures and
pari passu with the 8 1/4% Notes and any 10 3/8% Notes that remain outstanding.
CERTAIN COVENANTS
The Indenture will contain the following covenants:
Restriction on Incurrence of Indebtedness by the Company and on Incurrence
of Indebtedness and Issuance of Preferred Stock by Its Subsidiaries. The Company
shall not, and shall not permit any Subsidiary to, create, incur, assume or
guarantee the payment of any Indebtedness, and shall not permit any of its
Subsidiaries to issue any Preferred Stock, if, at the time of such event and
after giving effect thereto on a pro forma basis, the Company's ratio of
Consolidated Debt to Consolidated Tangible Net Worth, as of the most recent date
for which consolidated financial statements are available and adjusted for the
incurrence of all Indebtedness and the issuance of all Preferred Stock by
Subsidiaries (other than Permitted Indebtedness) since that date, would be
greater than 1.75 to 1. This restriction shall not preclude the incurrence of
Permitted Indebtedness.
'Consolidated Debt' means, on any date, the sum of (i) total Indebtedness
of the Company and its Subsidiaries, at such date, determined in accordance with
generally accepted accounting principles as in effect on December 31, 1995
('GAAP') on a consolidated basis, and (ii) the aggregate liquidation preference
of all Preferred Stock of Subsidiaries of the Company, at such date, other than
Preferred Stock to the extent held by the Company and its Subsidiaries;
provided, that Consolidated Debt shall not include Permitted Indebtedness.
'Indebtedness' of any Person means (i) any liability of such Person (a) for
borrowed money, (b) evidenced by a note, debenture or similar instrument
(including a Purchase Money Obligation or deferred payment obligation) given in
connection with the acquisition of any property or assets (other than inventory
or similar property acquired in the ordinary course of business), including
securities, (c) for the payment of a Capitalized Lease Obligation of such Person
or (d) with respect to the reimbursement of any letter of credit, banker's
acceptance or similar credit transaction (other than trade letters of credit
issued in the ordinary course of business; provided, that the failure to make
prompt reimbursement of any trade letter of credit shall be deemed to be the
incurrence of Indebtedness); and (ii) any guarantee by such Person of any
liability of others described in clause (i) above or any obligation of such
Person with respect to any liability of others described in clause (i) above.
Indebtedness shall not include Deposits.
'Permitted Indebtedness' means (i) any Indebtedness of the Company and its
Subsidiaries outstanding on the date of the Indenture, or any refinancing or
replacement thereof; provided, that the
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aggregate amount of such Indebtedness is not increased, (ii) Acquired
Indebtedness, (iii) Preferred Stock of Subsidiaries held by the Company or its
Subsidiaries (it being understood that the sale of such Preferred Stock by the
Company or such Subsidiary to any Person other than the Company or a Subsidiary
of the Company or such Subsidiary no longer being a Subsidiary shall be deemed
the issuance of Preferred Stock for purposes of the above test) and (iv)
intercompany Indebtedness.
'Acquired Indebtedness' means Indebtedness or Preferred Stock of a Person
either (i) existing at the time such Person becomes a Subsidiary, (ii) assumed
in connection with the acquisition of assets of such Person or (iii) any
refinancing or replacement by such Person of such Indebtedness or Preferred
Stock; provided, that the aggregate amount of such Indebtedness or Preferred
Stock then outstanding is not increased. Acquired Indebtedness shall not include
(x) any such Indebtedness created or Preferred Stock issued in anticipation of
such Person becoming a Subsidiary (other than a refinancing or replacement of
Indebtedness or Preferred Stock of such Person, which original Indebtedness or
Preferred Stock was not incurred or issued in anticipation of such Person
becoming a Subsidiary), or (y) any Indebtedness or Preferred Stock that is
recourse to the Company or any Subsidiary or any of their respective assets,
other than to such Person and its Subsidiaries and their respective assets.
Restriction on Investments by Insurance Subsidiaries. The Indenture will
provide that the Company shall not permit any Subsidiary which is an insurance
company to make, directly or indirectly, any Investment other than in Investment
Grade Securities if, after giving effect thereto at the time of such Investment,
less than 80% of the aggregate Investments of such insurance company would
consist of Investment Grade Securities, valuing Investments for purposes of this
restriction at original cost. The foregoing restriction shall not (i) apply to
Investments in the Company or any Subsidiary of the Company, (ii) prevent the
Company or its Subsidiaries from acquiring the Capital Stock of, or all or
substantially all of the assets of, an insurance company or (iii) apply to
securities issued in a restructuring or exchange offer or similar transaction
offered generally to all holders of another security then held by such
Subsidiary.
'Investment Grade Securities' means (i) securities having any of the
following ratings: at least BBB- or the equivalent thereof by S&P or at least
Baa3 or the equivalent thereof by Moody's or at least BBB- or the equivalent
thereof by Duff & Phelps Inc. ('Duff & Phelps') or (ii) cash or Cash
Equivalents.
'Cash Equivalents' shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States or any agency or instrumentality
thereof, (ii) U.S. dollar denominated time deposits, certificates of deposit,
eurodollar time deposits, eurodollar certificates of deposit and bankers
acceptances of any domestic commercial bank of recognized standing having
capital and surplus in excess of $500 million, (iii) commercial paper having a
rating from S&P of at least A-2 or the equivalent thereof or from Moody's of at
least P-2 or the equivalent thereof or from Duff & Phelps of at least D-2 or the
equivalent thereof and maturing within nine months from the date of acquisition,
and (iv) tax-exempt commercial paper of United States municipal, state or local
governments rated at least A-2 or the equivalent thereof by S&P or at least P-2
or the equivalent thereof by Moody's or at least D-2 or the equivalent thereof
by Duff & Phelps and maturing within nine months from the date of acquisition.
Restricted Payments and Restricted Investments. The Company shall not, and
shall not permit any Subsidiary to, make, directly or indirectly, any Restricted
Payment or Restricted Investment if, immediately after giving effect to such
Restricted Payment or Restricted Investment, as the case may be: (a) a Default
or Event of Default under the Indenture shall have occurred and be continuing,
(b) the Company's Consolidated Tangible Net Worth would be less than $250
million, (c) the Company would not be permitted to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to the
covenant contained under 'Restriction on Incurrence of Indebtedness by the
Company and on Incurrence of Indebtedness and Issuance of Preferred Stock by its
Subsidiaries' above or (d) the sum of (x) the aggregate amount expended for all
Restricted Payments subsequent to March 31, 1992 and (y) the aggregate amount of
Restricted Investments made subsequent to March 31, 1992 and then outstanding
reduced by any write down of any such Restricted Investment to the extent that
such write down otherwise reduced Consolidated Net Income (the amount so
expended for a Restricted Payment or a Restricted Investment, if other than in
cash, to be determined by the Board of Directors of the Company, whose
determination shall be conclusive and evidenced by a Board
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Resolution) would exceed the sum of (1) $35 million, (2) 50% of the aggregate
Consolidated Net Income of the Company (or minus 100% of the aggregate
Consolidated Net Loss of the Company) accrued on a cumulative basis subsequent
to March 31, 1992, and (3) the aggregate net proceeds, including the fair value
of property other than cash (as determined by the Board of Directors of the
Company, whose determination shall be conclusive and evidenced by a Board
Resolution), received by the Company in respect of the issue or sale subsequent
to March 31, 1992 of (i) any shares of Capital Stock of the Company, or (ii) any
Indebtedness of the Company to the extent converted into or exchanged for
Capital Stock of the Company subsequent to March 31, 1992. The foregoing
restrictions shall not prevent (x) the payment of any dividend or distribution
within 60 days after the date of declaration thereof, if at such date of
declaration such payment complied with the foregoing provisions, or (y) the
retirement of any shares of the Company's Capital Stock by exchange for, or upon
conversion of, or out of the proceeds of the substantially concurrent sale
(other than to a Subsidiary) of, other shares of the Capital Stock of the
Company, and neither such retirement, exchange or conversion nor the proceeds of
any such sale shall be included in any computation made above. At June 30, 1996,
the amount available for Restricted Payments and Restricted Investments was
approximately 38% of the Company's total shareholders' equity at that date. On
the first day on which the aggregate Restricted Payments and Restricted
Investments exceed by $100 million (calculated on the date of payment or
investment) the amount of Restricted Payments and Restricted Investments that
could otherwise be made pursuant to this paragraph if gains on sales of
segments, businesses or major lines of business, net of losses on such sales
(whether sold as assets or stock), had been excluded from the definition of
'Consolidated Net Income,' then each Noteholder shall have the right, at such
Noteholder's option, to require the Company to purchase all or any portion (in
integral multiples of $1,000) of such Noteholder's Notes at 101% of the
principal amount thereof, plus accrued interest; provided, that the Company will
not be obligated to purchase any of such Notes unless Noteholders holding at
least 10% of the Notes outstanding at the date of such Restricted Payment or
Restricted Investment (other than Notes held by the Company and its Affiliates)
shall have tendered their Notes for repurchase. The mechanics, timing and other
terms of the offer will be substantially the same as those with respect to a
'Change of Control,' as described below.
'Consolidated Net Income' and 'Consolidated Net Loss' mean, for any period,
the net income or loss, as the case may be, of the Company and its Subsidiaries
for such period determined on a consolidated basis in accordance with GAAP
(provided, that, for periods ended prior to January 1, 1995, Consolidated Net
Income shall mean the reported income before cumulative effects of changes in
accounting principles of the Company and its Subsidiaries); provided, that there
shall be excluded therefrom (to the extent otherwise included therein) (i) the
net income (or net loss) of any Person that is not the Company or a Subsidiary
of the Company, except net income of such Person may be included to the extent
of the amount of dividends or other distributions actually paid or made to the
Company or any of its Subsidiaries by such other Person during such period, (ii)
except to the extent includible pursuant to the foregoing clause (i), the net
income (or net loss) of any other Person accrued prior to the date it becomes a
Subsidiary of the Company or is merged into or consolidated with the Company or
any of its Subsidiaries or such other Person's assets are acquired by the
Company or any of its Subsidiaries, (iii) all extraordinary gains, to the extent
they exceed extraordinary losses, in each case, determined in accordance with
GAAP and (iv) all gains or losses resulting from the effect of any accounting
change.
'Consolidated Tangible Net Worth' with respect to the Company means, as of
any date, the total shareholders' equity of the Company determined in accordance
with GAAP less (a) (to the extent not otherwise deducted from total
shareholders' equity at such date) the amount of Restricted Investments of the
Company and its Subsidiaries outstanding on such date and (b) any and all
goodwill and other intangible assets reflected on the consolidated balance sheet
of the Company as of such date. Deferred policy acquisition costs ('DPAC') and
that portion of the value of insurance in force resulting from an acquisition
and equivalent to the amount of DPAC of the acquired entity outstanding
immediately prior to such acquisition shall not be deemed goodwill or other
intangible assets for purposes of determining Consolidated Tangible Net Worth.
'Restricted Investment' means, with respect to the Company or any
Subsidiary of the Company, an Investment by such Person in an Affiliate of the
Company (other than (x) in the Company or a
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Subsidiary of the Company or (y) in a Person that is an Affiliate of the Company
solely because of (i) the ownership of securities of such Person by the Company
or its Subsidiaries, (ii) contractual arrangements between the Company and its
Subsidiaries and such Person or (iii) a combination of (i) and (ii)).
'Restricted Payment' means (i) the declaration or making of any dividend or
of any other payment or distribution on or with respect to the Company's Capital
Stock (other than dividends, payments or distributions payable solely in shares
of the Company's Capital Stock), (ii) any payment on account of the purchase,
redemption, retirement or other acquisition for value of the Company's Capital
Stock; provided, that so long as there shall not be a Default or Event of
Default under the Indenture any payment to the estate of Ian M. Cumming or
Joseph S. Steinberg (or any trustee or other legal representative on behalf of
the legatees or heirs of such Persons) on account of the repurchase or
redemption of Voting Stock owned by such estates (or trustees or legal
representatives), solely from the net proceeds of any life insurance maintained
by the Company on either of such Persons, shall not be a Restricted Payment and
(iii) the declaration or making of any dividend or any other payment or
distribution with respect to the Capital Stock of any Subsidiary of the Company
and any payment on account of the purchase, redemption, retirement or other
acquisition for value of the Capital Stock of any Subsidiary of the Company but,
with respect to this clause (iii), only to the extent such dividend, payment or
distribution is received by an Affiliate of the Company (other than (x) the
Company or a Subsidiary of the Company or (y) a Person that is an Affiliate of
the Company solely because of (A) the ownership of securities of such Person by
the Company or its Subsidiaries, (B) contractual arrangements between the
Company and its Subsidiaries and such Person or (C) a combination of (A) and
(B)).
Maintenance of Consolidated Tangible Net Worth. The Company is required to
furnish the Trustee with an Officers' Certificate within 55 days after the end
of any fiscal quarter (100 days after the end of any fiscal year) notifying the
Trustee that the Company's Consolidated Tangible Net Worth has declined below
the Minimum Tangible Net Worth at the end of any fiscal quarter in which the
Company's Consolidated Tangible Net Worth has so declined. If, on the last day
of each of any two consecutive fiscal quarters (the last day of the second
fiscal quarter being referred to herein as a 'Deficiency Date'), the Company's
Consolidated Tangible Net Worth is less than the Minimum Tangible Net Worth,
then the Company is required, no later than 65 days after each such Deficiency
Date (110 days if such Deficiency Date is the last day of the Company's fiscal
year), to make an offer to all Noteholders to purchase (an 'Offer') 10% of the
aggregate principal amount of the Notes originally issued (the 'Offer Amount')
at a purchase price of 100% of the principal amount of the Notes, plus accrued
interest to the date of purchase. The Offer is required to remain open for a
period of 20 business days following its commencement (unless required to remain
open for a longer period by applicable law) and the Company is required to
purchase the Offer Amount of the Notes on a designated date no later than five
business days after the termination of the Offer or, if less than the Offer
Amount has been tendered, all Notes then tendered; provided, however, that the
Company will not be obligated to purchase any of such Notes unless Noteholders
holding at least 10% of the Offer Amount of Notes shall have tendered and not
subsequently withdrawn their Notes for repurchase. If the aggregate principal
amount of Notes tendered to the Company exceeds the Offer Amount, the Company is
required to purchase the Notes tendered to it pro rata among the Notes tendered
(with such adjustments as may be appropriate so that only Notes in denominations
of $1,000 and integral multiples thereof shall be purchased). The Company will
comply with all applicable Federal and state securities laws in connection with
each Offer. In no event will the failure of the Company's Consolidated Tangible
Net Worth to equal or exceed the Minimum Tangible Net Worth at the end of any
fiscal quarter be counted toward the making of more than one Offer. The Company
may reduce the principal amount of Notes to be purchased pursuant to the Offer
by subtracting 100% of the principal amount of Notes acquired by the Company
subsequent to the Deficiency Date through purchase or exchange and surrendered
for cancellation. The Company, however, may not credit Notes that have been
previously used as a credit against any obligation to repurchase Notes pursuant
to this provision, pursuant to a Change of Control offer or pursuant to the
repurchase obligation described under 'Restricted Payments and Restricted
Investments.'
'Minimum Tangible Net Worth' means $250 million.
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Limitation on Payment Restrictions Affecting Subsidiaries. The Company
shall not, and shall not permit any Subsidiary to, directly or indirectly,
create or otherwise cause to exist or become effective any encumbrance or
restriction on the ability of any Subsidiary to (a) pay dividends or make any
other distributions on its Capital Stock or any other interest or participation
in, or measured by, its profits, owned by the Company or any Subsidiary, or pay
any Indebtedness owed to the Company or any Subsidiary, (b) make loans or
advances to the Company or any Subsidiary or (c) transfer any of its properties
or assets to the Company, except for such encumbrances or restrictions existing
under or by reasons of (i) applicable law, (ii) the Indenture, (iii) customary
provisions restricting subletting or assignment of any lease governing a
leasehold interest of the Company or any Subsidiary, (iv) any instrument
governing Acquired Indebtedness, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
such Person and its Subsidiaries, or the property or assets of such Person and
its Subsidiaries, so acquired, (v) Indebtedness existing on the date of the
Indenture and any refinancing of such existing Indebtedness so long as the terms
and conditions of any such refinancing agreements are no less favorable to the
Company than those contained in the agreements governing the Indebtedness being
refinanced or (vi) other Indebtedness; provided, that the Board of Directors of
the Company shall have concluded, in good faith, that the terms thereof do not
have a materially adverse effect on the Company, on a stand-alone basis, or the
Company's ability, on a stand-alone basis, to meet its obligations.
Limitation on Issuance of Other Subordinated Debt. The Company shall not
issue, assume, guarantee, incur or otherwise become liable, directly or
indirectly, for any Indebtedness subordinate or junior in ranking in any respect
to any Senior Indebtedness but senior in right of payment to the Notes.
REPURCHASE AT OPTION OF HOLDERS UPON A CHANGE OF CONTROL
In the event of any Change of Control, each Noteholder shall have the
right, at such Noteholder's option, to require the Company to purchase all or
any portion (in integral multiples of $1,000) of such Noteholder's Notes on the
date (the 'Change of Control Payment Date') which is 20 business days after the
date the Change of Control Notice (as defined below) is mailed (or such later
date as is required by applicable law) at 101% of the principal amount thereof,
plus accrued interest to the Change of Control Payment Date; provided, that the
Company will not be obligated to purchase any of such Notes unless Noteholders
holding at least 10% of the Notes outstanding at the Change of Control Payment
Date (other than Notes held by the Company and its Affiliates) shall have
tendered their Notes for repurchase. In addition, in the event of any Change of
Control, the Company will not, and will not permit any of its Subsidiaries to,
purchase or redeem any Indebtedness ranking junior to the Notes pursuant to any
analogous provisions prior to the Change of Control Payment Date.
The Company is obligated to send to all Noteholders, within five business
days after the occurrence of each Change of Control, a notice of the occurrence
of such Change of Control (the 'Change of Control Notice'), specifying a date by
which a Noteholder must notify the Company of such Noteholder's intention to
exercise the repurchase right and describing the procedure that such Noteholder
must follow to exercise such right. The Company is required to deliver a copy of
such notice to the Trustee and to cause a copy of such notice to be published in
a daily newspaper of national circulation. To exercise the repurchase right, the
Noteholder must deliver, on or before the fifth calendar day prior to the Change
of Control Payment Date, written notice (which shall be irrevocable, except as
provided below) to the Company (or an agent designated by the Company for such
purpose) of the Noteholder's exercise of such right, together with (i) the Note
or Notes with respect to which the right is being exercised, duly endorsed for
transfer with the form entitled 'Option of Holder to Elect Purchase' on the
reverse of the Note completed, and (ii) if the Change of Control Payment Date
falls between any record date for the payment of interest on the Notes and the
next succeeding interest payment date, an amount equal to the interest which the
Noteholder is entitled to receive on such interest payment date. The Company
will comply with all applicable Federal and state securities laws in connection
with each Change of Control Notice.
A 'Change of Control' shall be deemed to occur if (i) the Company has any
other Indebtedness outstanding (other than Indebtedness under a bank credit
agreement or similar bank financing) which provides for a Change of Control (as
defined in the instrument governing such Indebtedness) if Ian M.
15
<PAGE>
<PAGE>
Cumming, Chairman of the Board of the Company, or Joseph S. Steinberg, President
of the Company, ceases to beneficially own, in the aggregate, a certain
percentage of the outstanding Common Shares, which percentage ownership
requirement is in excess of 10%, and a Change of Control (as defined in the
instrument governing such Indebtedness) occurs under such Indebtedness or (ii)
at any time when the Company does not have any other Indebtedness outstanding of
the type referred to in clause (i), Ian M. Cumming or Joseph S. Steinberg,
individually or in the aggregate, sells, transfers or otherwise disposes of (a
'Disposition'), after the date of the Indenture, Common Shares so that, after
giving effect thereto, the sole beneficial ownership of outstanding Common
Shares by Mr. Cumming and/or Mr. Steinberg would, in the aggregate, fall below
10% of the then outstanding Common Shares; provided, that no Change of Control
shall be deemed to have occurred under clause (ii) if the Notes are rated by
Moody's or S&P as Investment Grade both at the time of such Disposition and for
a period of 90 days from the date of such Disposition (it being understood that,
with respect to the foregoing proviso, a Change of Control shall be deemed to
occur on the first date during such 90-day period when the Notes are rated below
Investment Grade by both Moody's and S&P). The term 'Common Shares' shall
include any securities issued as dividends or distributions on the Common
Shares. For purposes hereof, 'sole beneficial ownership' of Common Shares shall
be deemed to include (i) all Common Shares received after June 15, 1992 from Mr.
Cumming or Mr. Steinberg by any member of their respective immediate families or
by any trust for the benefit of either of them or any member of their respective
immediate families (a 'Recipient'), which Common Shares remain held by a
Recipient during the lifetime of Mr. Cumming or Mr. Steinberg (unless sold,
transferred or disposed of by such Recipient during the lifetime of Mr. Cumming
or Mr. Steinberg, as the case may be, in which case such Disposition by such
Recipient shall constitute a Disposition by Mr. Cumming or Mr. Steinberg, as the
case may be) and (ii) after the death of Mr. Cumming and/or Mr. Steinberg, all
Common Shares owned as of the date of death by the decedent, and any Recipient
of the decedent, regardless of whether such Recipient continues to own such
Common Shares after the date of death. In determining the number of outstanding
Common Shares then held by Messrs. Cumming and Steinberg and the total number of
outstanding Common Shares, there shall be excluded Common Shares issued by the
Company after December 31, 1991, or the conversion into or exchange for, after
December 31, 1991, Common Shares or securities convertible into or exchangeable
for Common Shares. As calculated pursuant to this provision, Messrs. Cumming and
Steinberg beneficially owned, in the aggregate, approximately 45.8% of the
Common Shares as of June 30, 1996.
As of the date hereof, the Company's most restrictive outstanding
Indebtedness that contains a change of control provision requires that Mr.
Cumming and/or Mr. Steinberg continue to have sole beneficial ownership of
outstanding Common Shares equal to at least 32% of the then outstanding Common
Shares; provided that, under such Indebtedness, Messrs. Cumming and/or Steinberg
may sell, transfer or otherwise dispose of additional Common Shares if, after
giving effect thereto, they would, in the aggregate, then have sole beneficial
ownership of Common Shares equal to at least 23% of the then outstanding Common
Shares, but only if, after giving effect to any such Disposition, the aggregate
market value of the Common Shares then so owned by Mr. Cumming and/or Mr.
Steinberg on the date of such Disposition would be at least $200 million;
provided, further, that, under such Indebtedness, upon the death of either Mr.
Cumming or Mr. Steinberg, the aggregate market value of the Common Shares then
so owned by the survivor on the date of such Disposition would be at least $100
million. There can be no assurance that the Company will have sufficient funds
or the financing to satisfy its obligations to repurchase the Notes and other
Indebtedness that may come due upon a Change of Control. In such case, the
Company's failure to purchase tendered Notes would constitute an Event of
Default under the Indenture.
The Noteholders holding a majority in principal amount of Notes then
outstanding may waive compliance by the Company of its obligation to repurchase
Notes upon a Change of Control. The Company may not waive such provisions. See
'Modification of the Indenture.'
The term 'Investment Grade' is defined as BBB- or higher by S&P or Baa3 or
higher by Moody's or the equivalent of such ratings by Moody's or S&P.
16
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<PAGE>
TRANSACTIONS WITH AFFILIATES
The Company shall not, and shall not permit any Subsidiary to, directly or
indirectly, enter into any transaction or series of related transactions with
any Affiliate (other than (a) with the Company or a Wholly Owned Subsidiary or
(b) the making of a Restricted Payment or Restricted Investment otherwise
permitted by the covenant described under 'Restricted Payments and Restricted
Investments' above), including, without limitation, any loan, advance or
investment or any purchase, sale, lease or exchange of property or the rendering
of any service, unless such transaction or series of transactions is in good
faith and at arm's-length and on terms which are at least as favorable as those
available in a comparable transaction from an unrelated Person. Any such
transaction that involves in excess of $10 million shall be approved by a
majority of the Independent Directors on the Board of Directors of the Company;
or, in the event that at the time of any such transaction or series of related
transactions there are no Independent Directors serving on the Board of
Directors of the Company, such transaction or series of related transactions
shall be approved by a nationally recognized expert with experience in
appraising the terms and conditions of the type of transaction for which
approval is required.
SUCCESSOR CORPORATION
The Company may not consolidate with, merge into or transfer all or
substantially all of its assets (i.e., 90% or more) to another corporation
unless (a) the successor corporation shall be existing under the laws of the
United States, any state thereof or the District of Columbia, (b) there shall
not be any Default or Event of Default under the Indenture, (c) such successor
corporation assumes all of the Obligations of the Company under the Notes and
the Indenture, (d) after giving effect to such transaction, such successor
corporation shall have a Consolidated Net Worth equal to or greater than the
Company and (e) after giving effect to such transaction, the Company or such
successor corporation is permitted to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) as provided in the Indenture.
Thereafter all such obligations of the Company will terminate.
REPORTS TO NOTEHOLDERS
The Company will mail copies of its annual reports and quarterly reports
mailed to its shareholders to Noteholders. If the Company is not required to
furnish annual or quarterly reports to its shareholders, the Company will, upon
request, mail to each Noteholder, at such Noteholder's address as appearing on
the Note register, audited annual financial statements and unaudited condensed
quarterly financial statements. Such financial statements shall be accompanied
by management's discussion and analysis of the results of operations and
financial condition of the Company for the period reported upon in substantially
the form required under the rules and regulations of the Commission in effect
from time to time.
THE TRUSTEE
Fleet National Bank will be the Trustee under the Indenture.
The Noteholders holding a majority in principal amount of all outstanding
Notes will have the right to direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee. The Indenture
will provide that, in case an Event of Default thereunder shall occur and be
continuing, the Trustee will be required to use the degree of care of a prudent
person in the conduct of his own affairs in the exercise of its power. Subject
to such provisions, the Trustee will be under no obligation to exercise any of
its rights or powers under the Indenture at the request of any of the
Noteholders, unless they shall have offered to the Trustee security and
indemnity satisfactory to it.
EVENTS OF DEFAULT AND NOTICE THEREOF
The term 'Event of Default' when used in the Indenture shall mean any one
of the following: (i) failure to pay (whether or not prohibited by the
subordination provisions) interest for 30 days or principal; (ii) failure to
perform any covenants not described in clause (i) for 30 days after receipt of
17
<PAGE>
<PAGE>
notice; (iii) the occurrence of any event of default under an instrument
evidencing or securing other indebtedness of the Company or any Material
Subsidiary for borrowed money in excess of $15 million resulting in the
acceleration of such indebtedness, which acceleration is not rescinded or
annulled pursuant to the terms of such instrument; and (iv) certain events of
bankruptcy, insolvency or reorganization relating to the Company or any Material
Subsidiary.
The term 'Material Subsidiary' means (i) any Subsidiary of the Company
which at December 31, 1995 was a 'significant subsidiary' under Regulation S-X
promulgated by the Commission or any successor to such Subsidiary and (ii) any
other Subsidiary of the Company; provided that the Company's investments in and
advances to such Subsidiary at the date of determination thereof, without giving
effect to any write-downs in such investments or advances taken within the prior
12 months, represent 20% or more of the Company's Consolidated Tangible Net
Worth as of such time; provided, however, that this clause (ii) shall not
include any Subsidiary if, at the time that it became a Subsidiary, the Company
contemplated commencing a voluntary case or proceeding under the Bankruptcy Law
with respect to such Subsidiary.
The Indenture will provide that the Trustee shall, within 90 days after the
occurrence of a default, provide to the Noteholders notice of all uncured
defaults known to it (the term default to include the events specified above
without grace or notice); provided, that, except in the case of default in the
payment of principal of or interest on any of the Notes, the Trustee shall be
protected in withholding such notice if and so long as a committee of its Trust
Officers in good faith determines that the withholding of such notice is in the
interests of the Noteholders.
In case an Event of Default shall have occurred and be continuing, the
Trustee or the Noteholders holding at least 25% in aggregate principal amount of
the Notes then outstanding, by notice in writing to the Company and to the
Trustee, may declare to be due and payable immediately the outstanding principal
amount and accrued interest, premiums, penalties and other amounts in respect of
the Notes and the Indenture. Such declaration may be annulled and past defaults
(except, unless theretofore cured, a default in payment of principal of or
interest on the Notes) may be waived by the holders of a majority in principal
amount of the Notes, upon the conditions provided in the Indenture.
The Indenture will include a covenant that the Company will file annually
with the Trustee a statement regarding compliance by the Company with the terms
thereof and specifying any defaults of which the signers may have knowledge.
MODIFICATION OF THE INDENTURE
Under the Indenture, the rights and obligations of the Company and the
rights of Noteholders may be modified by the Company and the Trustee only with
the consent of the Noteholders holding a majority in principal amount of the
Notes then outstanding; but no extension of the maturity of any Notes, or
reduction in the interest rate or extension of the time of payment of principal
of or interest on, or any change in the subordination of the Notes that is
adverse to the Noteholders, or any other modification in the terms of payment of
the principal of or interest on the Notes or reduction of the percentage
required for modification will be effective against any Noteholder without such
Noteholder's consent. The Noteholders holding a majority in principal amount of
Notes then outstanding may waive compliance by the Company with certain
covenants, including those described under 'Certain Covenants -- Maintenance of
Consolidated Tangible Net Worth' and 'Repurchase at Option of Holders Upon a
Change of Control.'
SATISFACTION AND DISCHARGE OF INDENTURE
The Indenture will be discharged and cancelled upon payment of all the
Notes or upon deposit with the Trustee, within not more than one year prior to
the maturity of the Notes, of funds sufficient for such payment.
18
<PAGE>
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
between Jefferies & Company, Inc. and CS First Boston Corporation (collectively,
the 'Underwriters') and the Company, such Underwriters have severally agreed to
purchase from the Company $ and $ aggregate principal amount of the
Notes, respectively.
The Underwriting Agreement provides that the obligations of the
Underwriters thereunder are subject to certain conditions precedent and that the
Underwriters will be obligated to purchase all of the Notes if they purchase any
of the Notes.
The Underwriters propose to offer the Notes directly to the public at the
public offering price set forth on the cover page of this Prospectus and to
certain dealers at such price less a concession not in excess of % of the
principal amount of the Notes. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of % of the principal amount of the Notes
to certain other dealers. After the initial public offering, the offering price,
concession and discount may be changed.
The Company has agreed to indemnify the Underwriters against certain
liabilities including liabilities under the Securities Act or to contribute to
payments the Underwriters may be required to make in respect thereof.
Each of Jefferies & Company, Inc. and CS First Boston Corporation has
previously performed investment banking and other financial advisory services
for the Company for which they have received customary compensation. Jefferies &
Company, Inc. is also acting as Dealer Manager of the Tender Offer, for which it
will receive compensation in connection therewith.
LEGAL MATTERS
The validity of the securities offered hereby and certain legal matters
will be passed upon by Weil, Gotshal & Manges LLP, New York, New York, General
Counsel to the Company (members of which own approximately 165,000 Common
Shares). Certain legal matters will be passed upon for the Underwriters by
Cahill Gordon & Reindel (a partnership including a professional corporation),
New York, New York.
EXPERTS
The consolidated balance sheets as of December 31, 1995 and 1994 and the
consolidated statements of income, changes in shareholders' equity and cash
flows for each of the three years in the period ended December 31, 1995,
incorporated by reference in this Prospectus, have been incorporated herein in
reliance on the report of Coopers & Lybrand L.L.P., independent accountants,
given on the authority of that firm as experts in accounting and auditing.
19
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<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
DESCRIBED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY THE
UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO
MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO ITS DATE.
------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Available Information............................. 2
Incorporation of Certain Documents by Reference... 2
Prospectus Summary................................ 3
The Company....................................... 5
Use of Proceeds................................... 6
Capitalization.................................... 7
Selected Financial Data........................... 8
Description of Notes.............................. 10
Underwriting...................................... 19
Legal Matters..................................... 19
Experts........................................... 19
</TABLE>
$135,000,000
LEUCADIA NATIONAL
CORPORATION
% SENIOR SUBORDINATED NOTES
DUE 2006
PROSPECTUS
JEFFERIES & COMPANY, INC.
CS FIRST BOSTON
, 1996
<PAGE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses payable by the Registrant in connection with the
securities being registered are as follows:
<TABLE>
<S> <C>
SEC Registration Fee.............................................................. $ 46,552
Accounting Fees and Expenses...................................................... 100,000
Printing and Photocopying......................................................... 40,000
Legal Fees and Expenses........................................................... 150,000
Blue Sky Fees and Expenses........................................................ 25,000
Fees of Trustees.................................................................. 8,000
Miscellaneous Expenses............................................................ 10,448
--------
Total Expenses............................................................... $380,000
--------
--------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 722 through 725 of the New York Business Corporation Law (the
'Business Corporation Law') provide that a corporation may indemnify, with
certain limitations and exceptions, a director or officer as follows: (1) in a
derivative action, against his reasonable expenses, including attorneys' fees
but excluding certain settlement costs, actually and necessarily incurred by him
in connection with the defense thereof, or an appeal therein, if such director
or officer acted, in good faith, for a purpose which he reasonably believed to
be in (or in the case of service for another corporation, not opposed to) the
best interests of the corporation; and (2) in a civil or criminal non-derivative
action or proceeding including a derivative action by another corporation,
partnership or other enterprise in which any director or officer of the
indemnifying corporation served in any capacity at the indemnifying
corporation's request, against judgments, fines, settlement payments and
reasonable expenses, including attorneys' fees, incurred as a result thereof, or
any appeal therein, if such director or officer acted in good faith, for a
purpose which he reasonably believed to be in (or, in the case of service for
any other corporation, not opposed to) the best interests of the corporation
and, in criminal actions and proceedings, in addition, had no reasonable cause
to believe that his conduct was unlawful. Such indemnification is a matter of
right where the director or officer has been successful on the merits or
otherwise, and otherwise may be granted upon corporate authorization or court
award as provided in the statute.
Section 721 of the Business Corporation Law provides that indemnification
arrangements can be established for directors and officers, by contract, by-law,
charter provision, action of shareholders or board of directors, on terms other
than those specifically provided by Article 7 of the Business Corporation Law,
provided that no indemnification may be made to or on behalf of any director or
officer if a judgment or other final adjudication adverse to the director or
officer establishes that his acts were committed in bad faith or were the result
of active and deliberate dishonesty and were material to the cause of action so
adjudicated, or that he personally gained in fact a financial profit or other
advantage to which he was not legally entitled. Article V of the Company's
By-Laws provides for the indemnification, to the full extent authorized by law,
of any person made or threatened to be made a party in any civil or criminal
action or proceeding by reason of the fact that he, his testator or intestate is
or was a director or officer of the Company.
Section 726 of the Business Corporation Law provides that a corporation may
obtain insurance to indemnify itself and its directors and officers. The Company
maintains an insurance policy providing both directors and officers liability
coverage and corporate reimbursement coverage.
Article Sixth of the Company's Certificate of Incorporation contains a
charter provision eliminating or limiting director liability for monetary
damages arising from breaches of fiduciary duty, subject only to certain
limitations imposed by statute.
II-1
<PAGE>
<PAGE>
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------------------------------------------------------------------------------------------------------
<C> <S>
1 -- Form of Underwriting Agreement.
4.1 -- Form of Indenture, dated as of , 1996, between the Company and Fleet National Bank, as
Trustee, in respect of the Company's % Senior Subordinated Notes due 2006.
4.2 -- Form of Senior Subordinated Note (included in the form of Indenture filed as Exhibit 4.1 to this
Registration Statement).
5 -- Opinion of Weil, Gotshal & Manges LLP.
12 -- Statement of Computation of Ratio of Earnings to Fixed Charges.**
23.1 -- Consent of Coopers & Lybrand L.L.P.**
23.2 -- Consent of Weil, Gotshal & Manges LLP (included in the opinion filed as Exhibit 5 to this Registration
Statement).
24 -- Power of Attorney.**
25 -- Statement of Eligibility and Qualification of Fleet National Bank, as Trustee on Form T-1 with respect
to the % Senior Subordinated Notes due 2006.
99 -- Schedule P of the 1995 Annual Statement to Insurance Departments of the Colonial Penn Insurance Company
and Affiliated Property/Casualty Insurers and the Empire Insurance Company, Principal Insurer (filed as
Exhibit 28 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995).*
</TABLE>
- ------------
* Incorporated by reference.
** Previously filed.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions in Item 15 above, or otherwise, the
Company 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 of 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.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4), or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
II-2
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<PAGE>
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
The undersigned registrant hereby 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 (the 'Act') in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Act.
II-3
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City and State of New York, on this first day of
October, 1996.
LEUCADIA NATIONAL CORPORATION
By: /s/ JOSEPH A. ORLANDO
...................................
JOSEPH A. ORLANDO
VICE PRESIDENT AND CHIEF FINANCIAL
OFFICER
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the registrant and in the capacities indicated, on the date set forth above.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------ -------------------------------------------- -------------------
<C> <S> <C>
* Chairman of the Board October 1, 1996
......................................... (Principal Executive Officer)
(IAN M. CUMMING)
* President and Director October 1, 1996
......................................... (Principal Executive Officer)
(JOSEPH S. STEINBERG)
/S/ JOSEPH A. ORLANDO Vice President and Chief Financial Officer October 1, 1996
......................................... (Principal Financial Officer)
(JOSEPH A. ORLANDO)
* Vice President and Comptroller October 1, 1996
......................................... (Principal Accounting Officer)
(BARBARA L. LOWENTHAL)
* Director October 1, 1996
.........................................
(PAUL M. DOUGAN)
* Director October 1, 1996
.........................................
(LAWRENCE D. GLAUBINGER)
* Director October 1, 1996
.........................................
(JAMES E. JORDAN)
* Director October 1, 1996
.........................................
(JESSE CLYDE NICHOLS, III)
*By: /s/ JOSEPH A. ORLANDO
.........................................
JOSEPH A. ORLANDO
(ATTORNEY-IN-FACT)
</TABLE>
II-4
<PAGE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXEMPTION
EXHIBITS INDICATION
- -------- ---------
<C> <S> <C>
1 -- Form of Underwriting Agreement.............................................................
4.1 -- Form of Indenture, dated as of , 1996, between the Company and Fleet
National Bank, as Trustee, in respect of the Company's % Senior Subordinated Notes due
2006........................................................................................
4.2 -- Form of Senior Subordinated Notes (included in the form of Indenture filed as Exhibit 4.1
to this Registration Statement).............................................................
5 -- Opinion of Weil, Gotshal & Manges LLP......................................................
12 -- Statement of Computation of Ratio of Earnings to Fixed Charges.**..........................
23.1 -- Consent of Coopers & Lybrand L.L.P.**......................................................
23.2 -- Consent of Weil, Gotshal & Manges LLP (included in the opinion filed as Exhibit 5 to this
Registration Statement).....................................................................
24 -- Power of Attorney.**.......................................................................
25 -- Statement of Eligibility and Qualification of Fleet National Bank, as Trustee on Form T-1
with respect to the % Senior Subordinated Notes due 2006.................................
99 -- Schedule P of the 1995 Annual Statement to Insurance Departments of the Colonial Penn
Insurance Company and Affiliated Property/Casualty Insurers and the Empire Insurance
Company, Principal Insurer (filed as Exhibit 28 to the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1995).*..............................................
</TABLE>
- ------------
* Incorporated by reference.
** Previously filed.
<PAGE>
<PAGE>
Leucadia National Corporation
(a New York corporation)
$135,000,000
[ ]% Senior Subordinated Notes due 2006
UNDERWRITING AGREEMENT
October [ ], 1996
Jefferies & Company, Inc.
11100 Santa Monica Boulevard
Los Angeles, California 90025
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Dear Sirs:
Leucadia National Corporation, a New York corporation (the
"Company"), hereby confirms its agreement with each of you (the "Underwriters")
with respect to the sale by the Company and the purchase by the Underwriters,
acting severally and not jointly, of $135,000,000 aggregate principal amount of
the Company's [ ]% Senior Subordinated Notes due 2006 (the "Securities") as set
forth in Schedule A hereto.
The Securities are to be issued pursuant to an indenture (the
"Indenture") between the Company and [
], as Trustee (the "Trustee").
You have advised us that you desire to purchase the Securities
and that you propose to make a public offering of the Securities as soon as you
deem advisable after the Registration Statement referred to below becomes
effective, the Pricing Agreement (as defined below) has been executed and
delivered and the Indenture has been qualified under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act").
<PAGE>
<PAGE>
-2-
Prior to the purchase and public offering of the Securities by
the Underwriters, the Company and the Underwriters shall enter into an agreement
substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any standard form of
written telecommunication between the Company and the Underwriters and shall
specify such applicable information as is indicated in Exhibit A hereto. The
offering of the Securities will be governed by this Agreement, as supplemented
by the Pricing Agreement. From and after the date of execution and delivery of
the Pricing Agreement, this Agreement shall be deemed to incorporate the Pricing
Agreement.
The terms which follow, when used in this Agreement, shall have
the meanings indicated. "Preliminary Prospectus" shall mean any preliminary
prospectus referred to in Section 1(a)(i) below and any preliminary prospectus
included in the Registration Statement on the date that the Registration
Statement becomes effective (the "Effective Date") that omits Rule 430A
Information (as defined below). "Registration Statement" shall mean the
registration statement referred to in Section 1(a)(i) below, including exhibits,
as amended at the Representation Date (as defined below) (or, if not effective
at the Representation Date, in the form in which it shall become effective) and,
in the event any post-effective amendment thereto becomes effective prior to the
Closing Date (as defined in Section 2 hereof), shall also mean such registration
statement as so amended. Such term shall include Rule 430A Information deemed to
be included therein at the Effective Date as provided by Rule 430A (as defined
below). The prospectus constituting a part of the Registration Statement
(including the Rule 430A Information) as from time to time amended or
supplemented, is hereinafter referred to as the "Prospectus", except that if any
revised prospectus shall be provided to the Underwriters by the Company which
differs from the prospectus on file at the Securities and Exchange Commission
(the "Commission") at the Effective Date (whether or not such revised prospectus
is required to be filed by the Company pursuant to Rule 424 of the Act
Regulations), the term "Prospectus" shall refer to each such revised prospectus
from and after the time it is first provided to the Underwriters for such use.
"Rule 158," "Rule 424" and "Rule 430A" refer to such rules under the Securities
Act of 1933, as amended (the "Act"; the rules and regulations under the Act, the
"Act Regulations"). "Rule 430A Information" means information with respect to
the Securities and the offering thereof permitted to be omitted from the
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Registration Statement when it becomes effective pursuant to Rule 430A. Any
reference herein to the Registration Statement, a Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3, which have been filed under
the Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission promulgated thereunder (collectively, the "Exchange Act") as
of the Effective Date, and any reference herein to the terms "amend,"
"amendment" or "supplement" with respect to the Registration Statement, a
Preliminary Prospectus or Prospectus shall be deemed to refer to and include the
filing after the execution hereof of any document with the Commission deemed to
be incorporated by reference therein (all such incorporated documents being
herein called the "Incorporated Documents").
SECTION 1. Representations and Warranties. (a) The Company
represents and warrants to the Underwriters as of the date hereof and as of the
date of execution of the Pricing Agreement (such date being referred to as the
"Representation Date") and as of the Closing Date (as defined in Section 2
below), as follows:
(i) The Company meets the requirements for use of Form S-3 under
the Act and has filed with the Commission a registration statement
(Registration No. 333-[ ]) on such Form, including a related preliminary
prospectus, for the registration under the Act of the offering and sale
of the Securities. The Company may have filed one or more amendments
thereto, including the related preliminary prospectus, each of which has
previously been furnished to the Underwriters. The Company will file
with the Commission either (A) prior to effectiveness of such
registration statement, a further amendment to such registration
statement (including the form of final prospectus) or (B) after
effectiveness of such registration statement, a final prospectus in
accordance with Rules 430A and 424(b) of the Act Regulations. The
Company has included in such registration statement, as amended at the
Effective Date, all information (other than Rule 430A Information in the
case of clause (B)) required by the Act and the Act Regulations to be
included in the Prospectus with respect to the Securities and the
offering thereof. As filed, such amendment and form of final prospectus,
or such final prospectus, shall contain all Rule 430A Information,
together with all other such required information, with respect to
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the Securities and the offering thereof and, except to the extent the
Underwriters shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to the Underwriters prior to
the date hereof.
(ii) On the Effective Date and on the Representation Date and the
Closing Date, the Registration Statement did and will, and when the
Prospectus is first filed (if required) in accordance with Rule 424(b)
and on the Representation Date and the Closing Date, the Prospectus
(together with any supplements thereto) will comply in all material
respects with the applicable requirements of the Act and the Act
Regulations; on the Effective Date and the Closing Date, the
Registration Statement did not and will not contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Representation Date and the
Closing Date, and on the date of any filing pursuant to Rule 424(b), the
Prospectus (together with any supplements thereto) did not and will not
include 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;
provided, that the Company makes no representations or warranties to an
Underwriter as to the information contained in or omitted from the
Registration Statement or the Prospectus (or any supplement thereto) in
reliance upon and in conformity with information furnished in writing to
the Company by or on behalf of such Underwriter with respect to such
Underwriter for use in connection with the preparation of the
Registration Statement or the Prospectus (or any supplement thereto).
(iii) In reliance in part upon representations of Coopers &
Lybrand L.L.P., the accountants who have certified or shall certify the
financial statements filed or to be filed with the Commission as part of
the Registration Statement and the Prospectus (including the
Incorporated Documents) are independent accountants as required by the
Act.
(iv) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of New York, with all requisite
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-5-
corporate power and authority to own its properties and conduct its
business as described in the Prospectus, and is duly qualified to
transact business and is in good standing as a foreign corporation in
each jurisdiction where the nature of its activities requires such
qualification except where the failure of the Company to be so qualified
would not, singly or in the aggregate, have a Material Adverse Effect
(as defined below).
(v) Each of the Company's subsidiaries listed in Exhibit 21 to
the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995 and such other subsidiaries created after such date
that would be required to be so listed if in existence at such date
(collectively, the "Subsidiaries") has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction in which it is chartered or organized, with all requisite
corporate power and authority to own its properties and conduct its
business as described in the Prospectus, and is duly qualified to
transact business and is in good standing as a foreign corporation in
each jurisdiction where the nature of its activities requires such
qualification except where the failure of such Subsidiary to be so
qualified would not, singly or in the aggregate, have a Material Adverse
Effect.
(vi) All the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued and are fully
paid and non-assessable, and, except as otherwise set forth in the
Registration Statement and the Prospectus, all outstanding shares of
capital stock of such Subsidiaries are owned by the Company, either
directly or through wholly-owned Subsidiaries, free and clear of any
security interests, claims, liens or encumbrances.
(vii) The Company and each of its Subsidiaries have all requisite
power and authority, and all necessary material authorizations,
approvals, orders, licenses, certificates and permits of and from
regulatory or governmental officials, bodies and tribunals, to own or
lease their respective properties and to conduct their respective
businesses as now being conducted and as described in the Prospectus,
and neither the Company nor any of its Subsidiaries has received any
notice of proceedings relating to
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the revocation or modification of any such authorizations, approvals,
orders, licenses, certificates or permits which, singly or in the
aggregate, if the failure to be so licensed or approved or if the
subject of an unfavorable decision, ruling or finding, would have a
materially adverse effect on the condition (financial or otherwise),
earnings or business of the Company and its Subsidiaries, considered as
one enterprise, whether or not occurring in the ordinary course of
business (a "Material Adverse Effect"); and the Company and its
Subsidiaries are in compliance with all applicable laws, rules,
regulations and orders and consents, the violation of which would have a
Material Adverse Effect.
(viii) The Incorporated Documents, when they became effective or
were or are filed with the Commission, as the case may be, complied or
will comply, as the case may be, in all material respects with the
applicable requirements of the Act, the Act Regulations and the Exchange
Act, as applicable.
(ix) Since the respective dates as of which information is
provided in the Prospectus, except as otherwise specifically stated
therein, there has been no material adverse change or development with
respect to the condition (financial or otherwise), earnings or business
of the Company and its Subsidiaries, considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material
Adverse Change").
(x) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus or the Incorporated Documents,
without giving effect to any exercise of outstanding options subsequent
to the date of the Prospectus and prior to the filing of any subsequent
Incorporated Document; all of the Company's issued and outstanding
common shares, $1.00 par value per share (the "Common Shares"), have
been duly authorized and validly issued and are fully paid and
non-assessable.
(xi) Neither the Company nor any of its Subsidiaries is in
violation of its respective charter or by-laws or similar organizational
documents or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement
<PAGE>
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-7-
or instrument (including, without limitation, any Senior Indebtedness of
the Company (as defined in the Indenture)) to which the Company or any
of its Subsidiaries is a party or by which it or any of them may be
bound, or to which any of the property or assets of the Company or any
of its Subsidiaries is subject, the effect of which violation or default
in performance or observance would be a Material Adverse Effect.
(xii) The Indenture has been duly authorized by the Company and,
upon execution and delivery by the Company (assuming the due
authorization, execution and delivery by the Trustee), will constitute a
valid and binding agreement of the Company, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting creditors' rights
and remedies generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law), including principles of commercial
reasonableness, good faith and fair dealing.
(xiii) The Securities, when executed by the Company and
authenticated by the Trustee in accordance with the terms of the
Indenture (assuming the due authorization, execution and delivery of the
Indenture by the Trustee), and delivered to and paid for by you in
accordance with the terms of this Agreement and the Pricing Agreement,
will constitute valid and binding obligations of the Company entitled to
the benefits of the Indenture.
(xiv) The Securities and the Indenture conform to the respective
descriptions thereof in the Registration Statement and Prospectus.
(xv) The Company is not (a) an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, or (b) a bank
holding company under the Bank Holding Company Act.
(xvi) There are no contracts or documents binding upon or
affecting the Company or any of its Subsidiaries that are required to be
filed as exhibits to the Registration Statement or to any of the
documents incorporated by reference therein by the Act, the Act
Regulations or the Exchange Act that have not been so filed.
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(xvii) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the
transactions contemplated hereby, except such as have been obtained
under the Act and the Trust Indenture Act and such as may be required
under the blue sky or insurance laws of any jurisdiction in connection
with the purchase and distribution of the Securities by the Underwriters
and such other approvals as have been obtained.
(xviii) Neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein contemplated, nor
the fulfillment of the terms hereof, will conflict with, result in a
breach of, or constitute a default under the terms of, any indenture or
other agreement or instrument to which the Company or any of its
Subsidiaries is a party or bound or any order, regulation, consent or
memorandum of understanding applicable to the Company or any of its
Subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Company or
any of its Subsidiaries (where such conflict, breach or default would,
singly or in the aggregate, have a Material Adverse Effect) or the
charter or by-laws of the Company.
(b) Any certificate signed by any officer of the Company and
delivered to the Underwriters or to counsel for the Underwriters pursuant to the
terms of this Agreement shall be deemed a representation and warranty by the
Company to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to the Underwriters; Closing. (a)The
Company agrees to sell to each Underwriter, severally and not jointly, and, on
the basis of the representations and warranties herein contained and subject to
the terms and conditions herein set forth, each Underwriter agrees to purchase
from the Company, at the purchase price set forth in the Pricing Agreement, the
aggregate principal amount of Securities set forth in Schedule A hereto opposite
the name of such Underwriter. The Company will have no obligation to sell to the
Underwriters any of the Securities hereunder unless the Underwriters purchase
all of the Securities hereunder.
If the Company has elected not to rely upon Rule 430A, the
initial public offering price of the Securities and the purchase price of the
Securities to be paid by the
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Underwriters and certain other principal terms of the Securities have each been
determined and set forth in the Pricing Agreement, dated the date hereof, and an
amendment to the Registration Statement and the Prospectus containing such
information will be filed before the Registration Statement becomes effective.
If the Company has elected to rely upon Rule 430A, the initial
public offering price of the Securities, the purchase price for the Securities
to be paid by the Underwriters and certain other principal terms of the
Securities shall be agreed upon and set forth in the Pricing Agreement. In the
event that such price and terms have not been agreed upon and the Pricing
Agreement has not been executed and delivered by all parties thereto by the
close of business on the fourth business day following the date of this
Agreement, this Agreement shall terminate forthwith, without liability of any
party to any other party, except as set forth in Section 4 hereof.
(b) Payment of the purchase price for, and delivery of, the
Securities to be purchased by the Underwriters shall be made at the offices of
Cahill Gordon & Reindel, 80 Pine Street, New York, New York 10005, or at such
other place as shall be agreed upon by the Underwriters and the Company, at
10:00 A.M. on the third business day following the date the Registration
Statement becomes effective (or, if the Company has elected to rely upon Rule
430A, the third business day after the date of execution of the Pricing
Agreement), or such other time not later than ten business days after such date
as shall be agreed upon by the Underwriters and the Company (such time and date
of payment and delivery being herein called "Closing Date").
Payment shall be made to the Company by wire transfer of
immediately available funds against delivery to the Underwriters of the
Securities to be purchased by them. The Securities shall be in such
denominations and registered in such names as the Underwriters may request in
writing at least two business days before the Closing Date. The Securities will
be made available for examination and packaging by the Underwriters not later
than 1:00 P.M. on the last business day prior to the Closing Date at the offices
of the Trustee in New York City.
SECTION 3. Covenants of the Company. The Company
covenants with each of the Underwriters as follows:
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(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the date of this Agreement,
and any amendment thereof, to become effective, as promptly as possible
after the filing thereof. The Company will not file any amendment to the
Registration Statement or amendment or supplement to the Prospectus
(including any document required to be filed under the Exchange Act that
upon filing is deemed to be incorporated by reference therein) to which
the Underwriters shall reasonably object in writing after a reasonable
opportunity to review such amendment or supplement. The Company shall
furnish to the Underwriters copies of any document that upon filing is
deemed to be incorporated by reference in the Registration Statement or
Prospectus. Subject to the foregoing sentences in this clause (a), if
the Registration Statement has become or becomes effective pursuant to
Rule 430A, or filing of the Prospectus or supplement to the Prospectus
is otherwise required under Rule 424(b), the Company will cause the
Prospectus, properly completed, or such supplement thereto to be filed
with the Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed and will provide evidence satisfactory
to the Underwriters of such timely filing. The Company will promptly
advise the Underwriters (A) when the Registration Statement, if not
effective at the date of this Agreement, and any amendment thereto,
shall have become effective, (B) when the Prospectus, and any supplement
thereto, shall have been filed (if required) with the Commission
pursuant to Rule 424(b), (C) when any amendment to the Registration
Statement shall have been filed or become effective, (D) of any request
by the Commission for any amendment of the Registration Statement or
supplement to the Prospectus or for any additional information, (E) of
the receipt by the Company of any notification of, or if the Company
otherwise has knowledge of, the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (F) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance
of any such stop order and, if issued, to obtain as soon as possible the
withdrawal thereof.
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(b) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a result
of which the Prospectus as then amended or supplemented would include
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to amend the Registration Statement or amend or supplement
the Prospectus to comply with the Act or the Act Regulations, the
Company promptly will prepare and file with the Commission, subject to
the second sentence of Section 3(a), an amendment or supplement which
will correct such statement or omission or effect such compliance.
(c) As soon as practicable, the Company will make generally
available to its securityholders and to the Underwriters an earning
statement or statements of the Company and its Subsidiaries covering the
twelve-month period ending December 31, 1997 which will satisfy the
provisions of Section 11(a) of the Act and Rule 158.
(d) The Company will furnish to the Underwriters and counsel for
the Underwriters, without charge, three signed copies of the
Registration Statement (including exhibits thereto and all documents
incorporated by reference therein) and, so long as delivery of a
prospectus by an Underwriter or dealer may be required by the Act, as
many copies of each Preliminary Prospectus and the Prospectus and all
amendments and supplements thereto as the Underwriters may reasonably
request.
(e) The Company will cooperate with the Underwriters and their
counsel in connection with endeavoring to obtain the qualification or
registration, or exemption from qualification, of the Securities for
offer and sale under the applicable securities and insurance laws of
such states and other jurisdictions of the United States as the
Underwriters may designate; provided, that in no event shall the Company
be obligated to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action which would subject it to
taxation or general service of process in any jurisdiction where it is
not now so subject; and will maintain such qualifications in effect for
a period of not less than one year from the Effective Date.
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SECTION 4. Payment of Expenses. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the printing and filing of the Registration Statement and the Form T-1 as
originally filed and of each amendment thereto, (ii) the printing and/or copying
of this Agreement, the Pricing Agreement and the Indenture, (iii) the
preparation, issuance and delivery of the Securities to the Underwriters,
including capital duties, stamp duties and transfer taxes, if any, payable upon
issuance of any of the Securities, the sale of the Securities to the
Underwriters and the fees and expenses of the Trustee, (iv) the fees and
disbursements of the Company's counsel and accountants, (v) the qualification of
the Securities under state securities and insurance laws in accordance with the
provisions of Section 3(e), including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of any Blue Sky Survey, (vi) the printing and
delivery to the Underwriters of copies of the Registration Statement as
originally filed and of each amendment thereto, of the Preliminary Prospectus,
and of the Prospectus and any amendments or supplements thereto, (vii) the
printing and/or copying and delivery to the Underwriters of copies of the Blue
Sky Survey, (viii) the fee of any filing for review of the offering with the
National Association of Securities Dealers, Inc., (ix) the fees and expenses
incurred in connection with the rating of the Securities by rating agencies and
(x) the fees and expenses incurred in connection with the listing of the
Securities on the New York Stock Exchange.
If this Agreement is terminated by the Underwriters in accordance
with the provisions of Section 5 or Sections 8(a)(i) or 8(a)(ii), the Company
shall reimburse the Underwriters for all of their reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
SECTION 5. Conditions of the Underwriters' Obligations. The
obligations of the Underwriters to purchase the Securities hereunder are subject
to the continued accuracy in all material respects of the representations and
warranties of the Company herein contained, to the accuracy of the statements of
the Company made in any certificate pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder, and to the following
further conditions:
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(a) The Registration Statement shall have become effective not
later than 5:30 P.M. on the date hereof, or at such later time and date
as may be approved by the Underwriters and by the Company and shall
remain effective at the Closing Date. No stop order suspending the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings therefor initiated or threatened by the
Commission. If the Company has elected to rely upon Rule 430A, the price
of the Securities and any price-related information previously omitted
from the effective Registration Statement pursuant to Rule 430A shall
have been transmitted to the Commission for filing pursuant to Rule
424(b) within the prescribed time period, and prior to the Closing Date,
the Company shall have provided evidence satisfactory to the
Underwriters of such timely filing, or a post-effective amendment
providing such information shall have been promptly filed and declared
effective in accordance with the requirement of Rule 430A.
(b) The Company shall have furnished to the Underwriters the
opinion of Weil, Gotshal & Manges, counsel for the Company, dated the
Closing Date, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of New York, with all requisite corporate power and
authority to own its properties and conduct its business as
described in the Prospectus, and, to the best knowledge of such
counsel, is duly qualified to transact business and is in good
standing as a foreign corporation in each jurisdiction where the
nature of its business requires such qualification except where
the failure of the Company to be so qualified would not, singly
or in the aggregate, have a materially adverse effect on the
condition (financial or otherwise), earnings or business of the
Company and the Subsidiaries (as defined below), considered as a
whole (solely for purposes of this Section 5(b), a "Material
Adverse Effect");
(ii) Each of Leucadia, Inc. and LNC Investments, Inc. and
any other corporations of which the Company owns more than 50% of
the outstanding capital stock, directly or indirectly, and which
contributed 10% or
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more of the Company's consolidated revenues for the year ended
December 31, 1995 or which represented 10% or more of the
Company's consolidated total assets at December 31, 1995, which
information may be based upon a certificate of an officer of the
Company (collectively, solely for purposes of this Section 5(b),
the "Subsidiaries") (other than Charter National Life Insurance
Company ("Charter"), Empire Insurance Company ("Empire") and
Colonial Penn Group, Inc. ("CPG") and its subsidiaries
(collectively, the "Insurance Subsidiaries") and other than
Phlcorp, Inc. ("Phlcorp")) has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the jurisdiction in which it is organized, with all requisite
corporate power and authority to own its properties and conduct
its business as described in the Prospectus, and, to the best
knowledge of such counsel, is duly qualified to transact business
and is in good standing as a foreign corporation in each
jurisdiction where the nature of its activities requires such
qualification, except where the failure of such Subsidiary to be
so qualified would not, singly or in the aggregate, have a
Material Adverse Effect;
(iii) To the knowledge of such counsel, all the
outstanding shares of capital stock of each Subsidiary (other
than the Insurance Subsidiaries and Phlcorp) have been duly
authorized and validly issued and are fully paid and
non-assessable, and, except as otherwise set forth in the
Registration Statement and the Prospectus, to such counsel's
knowledge, all outstanding shares of capital stock of such
Subsidiaries (other than the Insurance Subsidiaries and Phlcorp)
are owned by the Company, either directly or through wholly-owned
Subsidiaries, free and clear of any security interests, claims,
liens or encumbrances;
(iv) Such counsel does not know of any pending or
threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator
involving the Company or any of the Subsidiaries required to be
disclosed in the Prospectus, which is not adequately disclosed in
the Prospectus, or any franchise, contract or other document that
is material to the Company and its Subsidiaries,
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considered as a whole, and required to be described in the
Registration Statement or the Prospectus, or to be filed as an
exhibit, which is not described or filed as required;
(v) (a) The Registration Statement has become effective
under the Act; (b) any required filing of the Prospectus, and any
supplements thereto, pursuant to Rule 424(b) has been made in the
manner and within the time period required by Rule 424(b); and
(c) to the knowledge of such counsel, no stop order suspending
the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
threatened;
(vi) The Company meets the requirements for the use of
Form S-3 under the Act;
(vii) (a) Each of the Registration Statement and the
Prospectus (other than the financial statements (including the
notes thereto) and schedules and other financial and statistical
data contained or incorporated by reference therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act and
the rules thereunder; and (b) the Incorporated Documents (other
than the financial statements (including the notes thereto) and
schedules and other financial and statistical data contained or
incorporated by reference therein, as to which such counsel need
express no opinion), when filed, or as amended or supplemented,
complied as to form in all material respects with the
requirements of the Exchange Act;
(viii) Each of this Agreement and the Pricing Agreement
has been duly authorized, executed and delivered by the Company;
(ix) No consent, approval, authorization or order of any
New York, Delaware corporate or Federal governmental agency or
body or, to our knowledge, any court, is required for the
consummation of the transactions contemplated hereby, except such
as have been obtained under the Act and the Trust Indenture Act
and such as may be required under the blue sky or
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insurance laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the Underwriters
(as to which such counsel need express no opinion);
(x) Neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein
contemplated, nor the fulfillment of the terms hereof, will
conflict with, result in a breach of, or constitute a default
under, the terms of any indenture or other agreement or
instrument known to such counsel to which the Company or any of
the Subsidiaries is bound or any order, regulation, consent or
memorandum of understanding of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Company or any of the Subsidiaries of which
such counsel is aware and known by such counsel to be applicable
to the Company or any of the Subsidiaries (where such conflict,
breach or default would, singly or in the aggregate, have a
Material Adverse Effect) or the charter or by-laws of the
Company;
(xi) The Securities have been duly authorized by the
Company for issuance; the Securities, when executed by the
Company and authenticated by the Trustee in accordance with the
Indenture (assuming the due authorization, execution and delivery
of the Indenture by the Trustee) and delivered to and paid for by
the Underwriters in accordance with the terms of this Agreement
and the Pricing Agreement, will constitute valid and legally
binding obligations of the Company entitled to the benefits of
the Indenture, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar
laws affecting creditors' rights and remedies generally, and
subject, as to enforceability, to general principles of equity
(regardless of whether enforcement is sought in a proceeding in
equity or at law);
(xii) The Company's outstanding Common Shares have been
duly authorized and validly issued and are fully paid and
non-assessable; and the shareholders of the Company have no
preemptive rights with respect to the Common Shares;
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(xiii) The Indenture has been duly and validly authorized
by the Company and has been duly qualified under the Trust
Indenture Act and, when duly executed and delivered by the
Company (assuming the due authorization, execution and delivery
by the Trustee), will constitute a valid and legally binding
obligation of the Company, enforceable against the Company in
accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally,
and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a
proceeding in equity or at law);
(xiv) The Securities, when issued, and the Indenture
conform in all material respects to the description thereof
contained in the Prospectus;
(xv) The Company is not (a) an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended, or (b) a bank holding company under the Bank Holding
Company Act.
In addition, such counsel shall also state that such counsel have
participated in conferences with representatives of the Underwriters, officers
and other representatives of the Company and its subsidiaries and
representatives of the independent certified public accountants of the Company,
at which conferences the contents of the Registration Statement and the
Prospectus and related matters were discussed and, although such counsel have
not independently verified and are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus (except as set forth
in clause (xiv) of this Section 5(b)), on the basis of the foregoing (relying as
to materiality to a large extent upon the opinions of officers and other
representatives of the Company), no facts have come to the attention of such
counsel which lead such counsel to believe that the Registration Statement at
the time it became effective or at the Representation Date 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 or
that the Prospectus, at the Representation Date (unless the term "Prospectus"
refers to a prospectus which has been provided to the
<PAGE>
<PAGE>
-18-
Underwriters by the Company for use in connection with the offering of the
Securities which differs from the Prospectus on file at the Commission at the
Representation Date, in which case at the time it is first provided to the
Underwriters for such use) or at the Closing Date, contained or contains an
untrue statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements contained
therein, in the light of the circumstances under which they were made, not
misleading; provided, that such counsel need not express any view with respect
to (i) the Form T-1 and (ii) the financial statements (including the notes
thereto), supporting schedules or any other financial and statistical data set
forth or referred to or incorporated by reference in the Registration Statement
or the Prospectus.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than New
York or the federal law of the United States, to the extent they deem proper and
specified in such opinion, upon the opinions of other counsel and (B) as to
matters of fact, to the extent they deem proper, on representations or
certificates of responsible officers of the Company and certificates of public
officials. References to the Prospectus in this Section 5(b) include any
supplements thereto at or prior to the Closing Date.
(c) The General Counsel or Compliance Officer, as the case may
be, of each of Charter, Empire and CPG and its subsidiaries shall have furnished
to the Underwriters their opinions or certificates, as the case may be, dated
the Closing Date, to the effect that:
(i) The applicable Insurance Subsidiary has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is chartered or
organized, with all requisite corporate power and authority to own its
properties and conduct its business as described in the Prospectus, and
is duly qualified to transact business and is in good standing as a
foreign corporation in each jurisdiction where the nature of its
activities requires such qualification, except where the failure of such
Insurance Subsidiary to be so qualified would not, singly or in the
aggregate, have a materially adverse effect on the condition (financial
or otherwise), earnings or business of such
<PAGE>
<PAGE>
-19-
Insurance Subsidiary (solely for purposes of this Section 5(c), a
"Material Adverse Effect");
(ii) To the knowledge of such counsel or officer, as the case may
be, all the outstanding shares of capital stock of such Insurance
Subsidiary has been duly authorized and validly issued and are fully
paid and non-assessable, and, except as otherwise set forth in the
Registration Statement and the Prospectus, all outstanding shares of
capital stock of such Insurance Subsidiary are owned by the Company,
either directly or through wholly owned Subsidiaries, free and clear of
any security interests, claims, liens or encumbrances;
(iii) To the knowledge of such counsel or officer, as the case may
be, each of the applicable Insurance Subsidiaries has all necessary
federal, state or local governmental licenses, authorizations, consents,
approvals and have made all necessary filings required under any
federal, state or local law, regulation or rule in order to conduct its
respective business, except where the failure to be so licensed, have
such authorizations, consents or approvals or to have made such filings
would not, singly or in the aggregate, have a Material Adverse Effect;
and to the knowledge of such counsel or officer, as the case may be,
such Insurance Subsidiary is not in violation of, or in default under,
any such license, authorization, consent or approval or any federal,
state or local law, regulation or rule or any decree, order or judgment
applicable to such Insurance Subsidiary, except where such violation or
default would not, singly or in the aggregate, have a Material Adverse
Effect; and
(iv) Each applicable Insurance Subsidiary which is an insurer or
an insurance holding company is duly licensed or admitted as an insurer
or an insurance holding company in each jurisdiction where it is
required to be so licensed to conduct its respective businesses as
described in the Prospectus, and each has all other necessary
authorizations, approvals, orders, certificates and permits of and from
all insurance authorities, commissions or other insurance or other
applicable regulatory authorities to conduct their respective businesses
as described in the Prospectus, except where the failure to be so
licensed or admitted or to have such authorizations, approvals,
<PAGE>
<PAGE>
-20-
orders, certificates and permits would not, singly or in the aggregate,
have a Material Adverse Effect.
(d) The Company shall have furnished to the Underwriters the
opinion of Dilworth, Paxson, Kalish & Kauffman, counsel for Phlcorp, dated the
Closing Date, to the effect that:
(i) Phlcorp has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the jurisdiction in
which it is chartered or organized, with all requisite corporate power
and authority to own its properties and conduct its business as
described in the Prospectus, and is duly qualified to transact business
and is in good standing as a foreign corporation in each jurisdiction
where the nature of its activities requires such qualification, except
where the failure of Phlcorp to be so qualified would not, singly or in
the aggregate, have a Material Adverse Effect; and
(ii) To the knowledge of such counsel, all the outstanding shares
of capital stock of Phlcorp have been duly authorized and validly issued
and are fully paid and non-assessable, and, except as otherwise set
forth in the Registration Statement and the Prospectus, all outstanding
shares of capital stock of Phlcorp are owned by the Company, free and
clear of any security interests, claims, liens or encumbrances.
(e) The favorable opinion, dated as of the Closing Date, of
Cahill Gordon & Reindel, counsel for the Underwriters, with respect to the
matters set forth in clauses (v) (clauses (a) and (c) only), (vii) (clause (a)
only), (viii), (xi), (xiii) and (xiv) of Section 5(b).
In addition, such counsel shall also state that such counsel have
participated in conferences with representatives of the Underwriters, officers
and other representatives of the Company and its subsidiaries, counsel for the
Company and representatives of the independent public accountants for the
Company, at which the contents of the Registration Statement and the Prospectus
and related matters were discussed and, although such counsel are not passing
upon and do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus, on the basis of the foregoing (relying as to
<PAGE>
<PAGE>
-21-
materiality to a large extent upon the opinions of officers and other
representatives of the Company), no facts have come to the attention of such
counsel which lead such counsel to believe that the Registration Statement, at
the time it became effective, 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, or that the Prospectus (unless
the term "Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of the
Securities which differs from the Prospectus on file at the Commission at the
Representation Date, in which case at the time it is first provided to the
Underwriters for such use) at the Representation Date, 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, in the light of the
circumstances under which they were made, not misleading; provided, that such
counsel need express no comment with respect to (i) the Form T-1 and (ii) the
financial statements (including the notes thereto), supporting schedules or any
other financial or statistical data set forth or referred to or incorporated by
reference in the Registration Statement or the Prospectus.
(f) The following conditions contained in clauses (i), (ii) and
(iii) of this Section 5(f) shall have been satisfied on and as of the Closing
Date and the Company shall have furnished to the Underwriters a certificate of
the Company, signed by the Chairman of the Board or the President and the
principal financial or accounting officer of the Company, dated the Closing
Date, to the effect that the signers of such certificate have carefully examined
the Registration Statement, the Prospectus, any supplement to the Prospectus,
the Incorporated Documents and this Agreement and that, to the best of their
knowledge:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of the
Closing Date with the same effect as if made on the Closing Date and the
Company has complied with all the agreements and satisfied all the
conditions under this Agreement on its part to be performed or satisfied
at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no
<PAGE>
<PAGE>
-22-
proceedings for that purpose have been instituted or threatened; and
(iii) since the date of the most recent financial statements
included in the Prospectus (exclusive of any supplement thereto), there
has been no Material Adverse Change.
(g) At the time of execution of this Agreement and at the Closing
Date, Coopers & Lybrand shall have furnished to the Underwriters a letter or
letters, dated respectively as of the Representation Date and as of the Closing
Date, in form and substance reasonably satisfactory to the Underwriters,
containing statements and information of the type customarily included in
accountants' "comfort letters" to underwriters with respect to the financial
statements and certain financial and statistical information pertaining to the
Company and its subsidiaries contained in the Registration Statement, the
Prospectus and the Incorporated Documents and any document or instrument deemed
to be incorporated by reference in the Registration Statement and Prospectus.
(h) At the Closing Date, counsel for the Underwriters shall have
been furnished with such information, certificates and documents as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Securities as contemplated herein and related proceedings, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained, or otherwise in
connection with the offering contemplated hereby; and all opinions and
certificates mentioned above or elsewhere in this Agreement shall be reasonably
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters.
If any condition specified in this Section 5 shall not have been
fulfilled in all material respects when and as required to be fulfilled, this
Agreement may be terminated by the Underwriters by notice to the Company, and
such termination shall be without liability of any party to any other party
except as provided in Section 4.
SECTION 6. Indemnification and Contribution. (a) The Company
agrees to indemnify, defend and hold harmless each Underwriter and its
respective officers, employees and directors and any person who controls any
Underwriter within
<PAGE>
<PAGE>
-23-
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or any such
officer, employee, director or controlling person may incur under the Act, the
Exchange Act or otherwise, as such expenses are incurred, insofar as such loss,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof) or in a Prospectus (the term Prospectus for the purpose of
this Section 6 being deemed to include any Preliminary Prospectus, the
Prospectus and the Prospectus as amended or supplemented), or arises out of or
is based upon any omission or alleged omission to state a material fact required
to be stated in either such Registration Statement or the Prospectus or
necessary to make the statements made therein not misleading, except insofar as
any such loss, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact made in
conformity with information furnished in writing by such Underwriter to the
Company expressly for use with reference to such Underwriter in such
Registration Statement or such Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information required to be stated in either such Registration Statement or
Prospectus or necessary to make such information not misleading; provided, that
the indemnity agreement contained in this Section 6(a) with respect to any
untrue statement or omission in any Preliminary Prospectus or amended
Preliminary Prospectus shall not inure to the benefit of any Underwriter (or to
the benefit of any person controlling such Underwriter) from whom the person
asserting any such loss, expense, liability or claim purchased the Securities
which is the subject thereof, if the Prospectus corrected any such alleged
untrue statement or omission and if such Underwriter failed to send or give a
copy of the Prospectus, excluding any documents incorporated by reference, to
such person at or prior to the written confirmation of the sale of Securities to
such person.
If any action is brought against an Underwriter or its respective
officers, employees, directors or person who controls any Underwriter (as
described above) in respect of which indemnity may be sought against the Company
pursuant to the foregoing paragraph, such Underwriter shall promptly notify
<PAGE>
<PAGE>
-24-
the Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment of counsel and
payment of reasonable expenses. Such Underwriter or such officer, employee,
director or person who controls any Underwriter (as described above) shall have
the right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or of such
persons unless the employment of such counsel shall have been authorized in
writing by the Company in connection with the defense of such action or the
Company shall not have employed counsel to have charge of the defense of such
action or such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to the Company (in which case the Company shall
not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the Company; provided, that the Company shall only be
responsible for the fees and expenses of one counsel for each Underwriter
hereunder. Anything in this paragraph to the contrary notwithstanding, the
Company shall not be liable for any settlement of any such claim or action
effected without its written consent, which consent shall not be unreasonably
withheld.
(b) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Company, each of its directors, officers and employees and any
person who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act from and against any loss, expense, liability or
claim (including the reasonable cost of investigation) which, jointly or
severally, the Company or any such person may incur under the Act or otherwise,
insofar as such loss, expense, liability or claim arises out of or is based upon
any untrue statement or alleged untrue statement of a material fact contained in
and in conformity with information furnished in writing by or on behalf of such
Underwriter to the Company expressly for use with reference to such Underwriter
in the Registration Statement (or in the Registration Statement as amended by
any post-effective amendment thereof by the Company) or in a Prospectus, or
arises out of or is based upon any omission or alleged omission to state a
material fact in connection with such information required to be stated either
in such Registration Statement or Prospectus or necessary to make such
information not misleading.
<PAGE>
<PAGE>
-25-
If any action is brought against the Company or any such person
in respect of which indemnity may be sought against any Underwriter pursuant to
the foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing of the institution of such action and such Underwriter
shall assume the defense of such action, including the employment of counsel and
payment of reasonable expenses. The Company or such person shall have the right
to employ its or his own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of the Company or such person unless the
employment of such counsel shall have been authorized in writing by such
Underwriter in connection with the defense of such action or such Underwriter
shall not have employed counsel to have charge of the defense of such action or
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to such Underwriter (in which case such Underwriter shall not
have the right to direct the defense of such action on behalf of the indemnified
party or parties), in any of which events such fees and expenses shall be borne
by such Underwriter and paid as incurred. Anything in this paragraph to the
contrary notwithstanding, no Underwriter shall be liable for any settlement of
any such claim or action effected without the written consent of such
Underwriter, which consent shall not be unreasonably withheld.
(c) If the indemnification provided for in this Section 6 is
unavailable to an indemnified party under subsection (a) or (b) of this Section
6 in respect of any losses, damages, expenses, liabilities or claims referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, expenses, liabilities or claims
(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 hand
from the offering of the Securities or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, 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 of the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the
<PAGE>
<PAGE>
-26-
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Company
bear to the total underwriting discounts and commissions received by the
Underwriters. The relative fault of the Company on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement of a material
fact or omission or alleged omission relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
expenses, liabilities and claims referred to above shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any claim or action.
(d) The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 6 were 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 Section 6(c) above. Notwithstanding
the provisions of this Section 6, 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 such Underwriter and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue statement or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 6 are several in proportion to their respective underwriting commitments
and not joint.
(e) The indemnity and contribution agreements contained in this
Section 6 and the covenants, warranties and representations of the Company
contained in this Agreement shall remain in full force and effect irrespective
of any investigation made by or on behalf of any Underwriter, or any of its
officers, employees, directors or person who controls any Underwriter within the
meaning of Section 15 of the Act or Section
<PAGE>
<PAGE>
-27-
20 of the Exchange Act, or by or on behalf of the Company, its directors,
officers, employees or any person who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, and shall survive any
termination of this Agreement or the issuance and delivery of the Securities.
The Company and each Underwriter agree promptly to notify the others of the
commencement of any litigation or proceeding against it and, in the case of the
Company, against any of the Company's officers and directors in connection with
the issuance and sale of the Securities, or in connection with the Registration
Statement or Prospectus.
SECTION 7. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties, and agreements contained in this
Agreement and the Pricing Agreement, or contained in certificates of officers of
the Company submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or any of its respective officers, employees, directors or person
who controls any Underwriter, or by or on behalf of the Company, and shall
survive delivery of the Securities to and payment for the Securities by the
Underwriters.
SECTION 8. Termination of Agreement. (a) The Underwriters may
terminate this Agreement, by notice to the Company (i) if there shall occur any
default or breach by the Company hereunder or the failure to satisfy any of the
conditions contained in Section 5 hereof, (ii) if there has been, since the date
of this Agreement or since the respective dates as of which information is
provided in the Registration Statement and prior to the Closing Date, any
Material Adverse Change or any downgrading of any of the Company's securities or
the placement of any such securities on a so-called "credit watch" or similar
list by any major credit rating agency, or (iii) if, since the date of this
Agreement and prior to the Closing Date, (A) there has occurred any material
adverse change in the financial markets of the United States or any outbreak of
hostilities or other calamity or crisis, the effect of which on the financial
securities markets of the United States is such as to make it, in the judgment
of the Underwriters, impracticable to market the Securities or to enforce
contracts for the sale of the Securities, or (B) trading in any of the
securities of the Company has been suspended by the Commission, or trading
generally on the New York Stock Exchange has been suspended (other than by
limitation on hours or number of days of
<PAGE>
<PAGE>
-28-
trading), or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices for securities have been required, by the New York Stock
Exchange or by order of the Commission or any other governmental authority or
(C) a banking moratorium has been declared by either Federal or New York
authorities.
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4.
SECTION 9. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters, c/o Jefferies & Company,
Inc., 11100 Santa Monica Boulevard, Los Angeles, California 90025, attention of
Jerry Gluck; notices to the Company shall be directed to it at 315 Park Avenue
South, New York, New York 10010, attention of the Secretary of the Company, with
a copy to Weil, Gotshal & Manges at 767 Fifth Avenue, New York, New York 10153,
attention of Stephen E. Jacobs, Esq.
Section 10. Parties. This Agreement and the Pricing Agreement
shall each inure to the benefit of and be binding upon the Underwriters and the
Company and their respective successors and legal representatives. Nothing
expressed or mentioned in this Agreement or the Pricing Agreement is intended or
shall be construed to provide any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and legal
representatives and the controlling persons and officers, employees and
directors referred to in Sections 6 and 7 and their respective heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or the Pricing Agreement or any provision herein or
therein contained. This Agreement and the Pricing Agreement and all conditions
and provisions hereof and thereof are intended to be for the sole and exclusive
benefit of the Underwriters and the Company and their respective successors and
legal representatives, and said controlling persons and officers and directors
and their respective heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
<PAGE>
<PAGE>
-29-
SECTION 11. Governing Law and Time. This Agreement and the
Pricing Agreement shall be governed by and construed in accordance with the laws
of the State of New York applicable to agreements made and to be performed in
said State. Specified times of day refer to New York City time.
<PAGE>
<PAGE>
-30-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with its terms.
Very truly yours,
LEUCADIA NATIONAL CORPORATION
By:
_____________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
JEFFERIES & COMPANY, INC.
By: __________________________
Name:
Title:
CS FIRST BOSTON CORPORATION
By: __________________________
Name:
Title:
<PAGE>
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Aggregate Principal
Amount of Securities
Name of Underwriter to be Purchased
- ------------------- --------------------
<S> <C>
Jefferies & Company, Inc. .....................................$[ ]
CS First Boston Corporation.....................................[ ]
------------
Total $135,000,000
</TABLE>
<PAGE>
<PAGE>
EXHIBIT A
Leucadia National Corporation
(a New York corporation)
$135,000,000
[ ]% Senior Subordinated Notes due 2006
PRICING AGREEMENT
October [ ], 1996
Jefferies & Company, Inc.
11100 Santa Monica Boulevard
Los Angeles, California 90025
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Dear Sirs:
Reference is made to the Underwriting Agreement dated October
[ ], 1996 (the "Underwriting Agreement") between Leucadia National
Corporation, a New York corporation (the "Company"), and you, relating to the
purchase by you from the Company, subject to the terms and conditions set forth
herein and therein, of $135,000,000 aggregate principal amount of the Company's
[ ]% Senior Subordinated Notes due 2006 (the "Securities"). This Agreement is
the Pricing Agreement referred to in the Underwriting Agreement and capitalized
terms used herein without definition shall have the meanings assigned to them in
the Underwriting Agreement.
Pursuant to Section 2 of the Underwriting Agreement, the Company
agrees with you as follows:
1. The initial public offering price of the Securities,
determined as provided in said Section 2, shall be [ ]% of the principal amount
thereof, plus accrued interest, if any, from October [ ], 1996.
2. The purchase price of the Securities to be paid by the
Underwriters shall be [ ]% of the principal amount
<PAGE>
<PAGE>
-2-
thereof, plus accrued interest, if any, from October [ ], 1996.
3. The interest rate to be borne by the Securities shall
be [ ]% per annum.
4. The Securities will mature on October [ ], 2006.
The Company represents and warrants to the Underwriters that the
representations and warranties of the Company set forth in Section 1 of the
Underwriting Agreement are accurate as though expressly made at and as of the
date hereof.
<PAGE>
<PAGE>
-3-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts and together with the Underwriting
Agreement, will be a binding agreement between you and the Company in accordance
with its terms and the terms of the Underwriting Agreement.
Very truly yours,
LEUCADIA NATIONAL CORPORATION
By:
____________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
JEFFERIES & COMPANY, INC.
By: __________________________
Name:
Title:
CS FIRST BOSTON CORPORATION
By: __________________________
Name:
Title:
<PAGE>
<PAGE>
================================================================================
LEUCADIA NATIONAL CORPORATION
and
[ ], Trustee
--------------------
INDENTURE
Dated as of October [ ], 1996
--------------------
$135,000,000
[ ]% Senior Subordinated Notes due 2006
================================================================================
<PAGE>
<PAGE>
CROSS-REFERENCE TABLE
<TABLE>
<CAPTION>
TIA Section Indenture Section
- ----------- -----------------
<S> <C>
310(a)(1)..................................................... 6.10
(a)(2)..................................................... 6.10
(a)(3)..................................................... N.A.
(a)(4)..................................................... N.A.
(a)(5)..................................................... 6.08
(b)........................................................ 6.08; 6.10
(c)........................................................ N.A.
311(a)........................................................ 6.11
(b)........................................................ 6.11
(c)........................................................ N.A.
312(a)........................................................ 2.05
(b)........................................................ 10.03
(c)........................................................ 10.03
313(a)........................................................ 6.06
(b)(1)..................................................... N.A.
(b)(2)..................................................... 6.06
(c)........................................................ 6.06; 10.02
(d)........................................................ 6.06
314(a)........................................................ 3.02; 3.03; 10.02
(b)........................................................ N.A.
(c)(1)..................................................... 10.04
(c)(2)..................................................... 10.04
(c)(3)..................................................... N.A.
(d)........................................................ N.A.
(e)........................................................ 10.05
(f)........................................................ N.A.
315(a)........................................................ 6.01(b)
(b)........................................................ 6.05; 10.02
(c)........................................................ 6.01(a)
(d)........................................................ 6.01(c)
(e)........................................................ 5.11
316(a)(last sentence)......................................... 10.06
(a)(1)(A).................................................. 5.05
(a)(1)(B).................................................. 5.02; 5.04; 8.02
(a)(2)..................................................... N.A.
(b)........................................................ 5.07
317(a)(1)..................................................... 5.08
(a)(2)..................................................... 5.09
(b)........................................................ 2.04
318(a)........................................................ 10.01
</TABLE>
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be
deemed to be part of this Indenture.
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TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
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Section 1.01. Definitions.................................................... 1
Section 1.02. Other Definitions.............................................. 10
Section 1.03. Incorporation by Reference of Trust
Indenture Act................................................ 10
Section 1.04. Rules of Construction.......................................... 11
ARTICLE TWO
THE SECURITIES
Section 2.01. Form and Dating................................................ 12
Section 2.02. Execution and Authentication................................... 12
Section 2.03. Registrar and Paying Agent..................................... 13
Section 2.04. Paying Agent To Hold Money in Trust............................ 13
Section 2.05. Securityholder Lists........................................... 14
Section 2.06. Transfer and Exchange.......................................... 14
Section 2.07. Replacement Securities......................................... 14
Section 2.08. Outstanding Securities......................................... 15
Section 2.09. Temporary Securities........................................... 15
Section 2.10. Cancellation................................................... 15
Section 2.11. Defaulted Interest............................................. 16
ARTICLE THREE
COVENANTS
Section 3.01. Payment of Securities.......................................... 16
Section 3.02. SEC Reports.................................................... 16
Section 3.03. Compliance Certificate......................................... 17
Section 3.04. Maintenance of Office or Agency................................ 18
Section 3.05. Corporate Existence............................................ 18
Section 3.06. Waiver of Stay, Extension or Usury Laws........................ 19
Section 3.07. Transactions with Affiliates................................... 19
Section 3.08. Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.......................... 20
Section 3.09. Limitation on Restricted Payments and
Restricted Investments....................................... 20
Section 3.10. Maintenance of Consolidated Tangible Net
Worth........................................................ 21
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Section 3.11. Change of Control.............................................. 25
Section 3.12. Limitation on Incurrence of Additional
Indebtedness by the Company and on
Incurrence of Additional Indebtedness
and Issuance of Preferred Stock by Its
Subsidiaries................................................. 28
Section 3.13. Limitation on Issuance of Other
Subordinated Debt............................................ 28
Section 3.14. Restriction on Investments by Insurance
Subsidiaries................................................. 28
Section 3.15. Limitation on Certain Payments or
Investments.................................................. 29
ARTICLE FOUR
SUCCESSOR CORPORATION
Section 4.01. When Company May Merge, etc.................................... 30
Section 4.02. Successor Corporation Substituted.............................. 31
ARTICLE FIVE
DEFAULTS AND REMEDIES
Section 5.01. Events of Default.............................................. 32
Section 5.02. Acceleration................................................... 33
Section 5.03. Other Remedies................................................. 34
Section 5.04. Waiver of Past Defaults........................................ 34
Section 5.05. Control by Majority............................................ 35
Section 5.06. Limitation on Remedies......................................... 35
Section 5.07. Rights of Holders To Receive Payment........................... 36
Section 5.08. Collection Suit by Trustee..................................... 36
Section 5.09. Trustee May File Proofs of Claim............................... 36
Section 5.10. Priorities..................................................... 36
Section 5.11. Undertaking for Costs.......................................... 37
ARTICLE SIX
TRUSTEE
Section 6.01. Duties of Trustee.............................................. 37
Section 6.02. Rights of Trustee.............................................. 39
Section 6.03. Individual Rights of Trustee................................... 39
Section 6.04. Trustee's Disclaimer........................................... 40
Section 6.05. Notice of Defaults............................................. 40
Section 6.06. Reports by Trustee to Holders.................................. 40
</TABLE>
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Section 6.07. Compensation and Indemnity..................................... 40
Section 6.08. Replacement of Trustee......................................... 42
Section 6.09. Successor Trustee by Merger, etc............................... 43
Section 6.10. Eligibility; Disqualification.................................. 43
Section 6.11. Preferential Collection of Claims Against
Company...................................................... 43
ARTICLE SEVEN
DISCHARGE OF INDENTURE
Section 7.01. Termination of Company's Obligations........................... 43
Section 7.02. Application of Trust Money..................................... 44
Section 7.03. Repayment to Company........................................... 44
Section 7.04. Reinstatement.................................................. 45
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders..................................... 45
Section 8.02. With Consent of Holders........................................ 46
Section 8.03. Compliance with Trust Indenture Act............................ 47
Section 8.04. Revocation and Effect of Consents.............................. 47
Section 8.05. Notation on or Exchange of Securities.......................... 48
Section 8.06. Trustee Protected.............................................. 48
ARTICLE NINE
SUBORDINATION
Section 9.01. Securities Subordinated to Senior
Indebtedness................................................. 48
Section 9.02. Company Not To Make Payments with Respect
to Securities in Certain Circumstances....................... 49
Section 9.03. Securities Subordinated to Prior Payment
of All Senior Indebtedness on
Dissolution, Liquidation or Reorganization
of Company................................................... 50
Section 9.04. Securityholders To Be Subrogated to
Rights of Holders of Senior
Indebtedness................................................. 51
Section 9.05. Obligation of the Company Unconditional........................ 52
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Section 9.06. Trustee Entitled To Assume Payments Not
Prohibited in Absence of Notice.............................. 53
Section 9.07. Application by Trustee of Monies
Deposited with It............................................ 53
Section 9.08. Subordination Rights Not Impaired by
Acts or Omissions of Company or Holders
of Senior Indebtedness....................................... 54
Section 9.09. Securityholders Authorize Trustee To...........................
Effectuate Subordination of Securities....................... 54
Section 9.10. Right of Trustee To Hold Senior
Indebtedness................................................. 55
Section 9.11. Article Nine Not To Prevent Events of
Default...................................................... 55
Section 9.12. Ranking; Designation........................................... 55
ARTICLE TEN
MISCELLANEOUS
Section 10.01. Trust Indenture Act Controls................................... 55
Section 10.02. Notices........................................................ 56
Section 10.03. Communication by Holders with Other
Holders...................................................... 57
Section 10.04. Certificate and Opinion as to Conditions
Precedent.................................................... 57
Section 10.05. Statements Required in Certificate or
Opinion...................................................... 57
Section 10.06. When Treasury Securities Disregarded........................... 58
Section 10.07. Rules by Trustee and Agents.................................... 58
Section 10.08. Legal Holidays................................................. 58
Section 10.09. Governing Law.................................................. 58
Section 10.10. No Adverse Interpretation of Other
Agreements................................................... 58
Section 10.11. No Recourse Against Others..................................... 58
Section 10.12. Successors..................................................... 59
Section 10.13. Duplicate Originals............................................ 59
Section 10.14. Separability................................................... 59
SIGNATURES.............. .............................................................. 60
EXHIBIT A - FORM OF SECURITY........................................................... A-1
</TABLE>
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NOTE: This Table of Contents shall not, for any purpose, be deemed
to be a part of this Indenture.
-iv-
<PAGE>
<PAGE>
INDENTURE dated as of October [ ], 1996 between Leucadia National
Corporation, a New York corporation (the "Company"), and [ ], as
trustee (the "Trustee").
Each party agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the holders of the Company's [ ]%
Senior Subordinated Notes due October [ ], 2006 (the "Securities"):
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness or Preferred Stock of
a Person either (i) existing at the time such Person becomes a Subsidiary, (ii)
assumed in connection with the acquisition of assets of such Person or (iii) any
refinancing or replacement by such Person of such Indebtedness or Preferred
Stock; provided, that the aggregate amount of such Indebtedness or Preferred
Stock then outstanding is not increased. Acquired Indebtedness shall not include
(x) any such Indebtedness created or Preferred Stock issued in anticipation of
such Person becoming a Subsidiary (other than a refinancing or replacement of
Indebtedness or Preferred Stock of such Person, which original Indebtedness or
Preferred Stock was not incurred or issued in anticipation of such Person
becoming a Subsidiary) or (y) any Indebtedness or Preferred Stock that is
recourse to the Company or any Subsidiary or any of their respective assets,
other than to such Person and its Subsidiaries and their respective assets.
"Affiliate" of the Company means (i) any Related Person and (ii)
any other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company. For the purposes of this
definition, "control" when used with respect to any Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent" means any Registrar, Paying Agent or co-registrar.
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"Board of Directors" means the Board of Directors of the Company
or any committee thereof.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"business day" means any day on which the New York Stock Exchange
is open for trading and which is not a Legal Holiday.
"Capitalized Lease" means any lease which is, in accordance with
GAAP, capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligations" means the discounted present
value of the rental obligations of any Person under any lease of any property
(whether real, personal or mixed) which, in accordance with GAAP, is required to
be capitalized on the balance sheet of such Person.
"Capital Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated) of
capital stock, including each class of common stock and preferred stock of such
Person.
"Cash Equivalents" shall mean (i) securities issued or directly
and fully guaranteed or insured by the United States or any agency or
instrumentality thereof, (ii) U.S. dollar denominated time deposits,
certificates of deposit, eurodollar time deposits, eurodollar certificates of
deposit, and bankers acceptances of any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000, (iii) commercial
paper having a rating from Standard & Poor's Corporation ("S&P") of at least A-2
or the equivalent thereof or from Moody's Investors Service, Inc. ("Moody's") of
at least P-2 or the equivalent thereof or from Duff & Phelps Inc. ("Duff &
Phelps") of at least D-2 or the equivalent thereof and maturing within nine
months from the date of acquisition, and (iv) tax-exempt commercial paper of
United States municipal, state or local governments rated at least A-2 or the
equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody's
or at least D-2 or the equivalent thereof by Duff & Phelps and maturing within
nine months from the date of acquisition.
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"Certain Payment or Investment" shall be deemed to occur on the
first day on which the aggregate Restricted Payments and Restricted Investments
exceed by $100,000,000 (calculated on the date of payment or investment) the
amount of Restricted Payments and Restricted Investments that could otherwise be
made pursuant to Section 3.09 if gains on sales of segments, businesses or major
lines of business, net of losses on such sales (whether sold as assets or
stock), had been excluded from the definition of "Consolidated Net Income".
"Common Shares" means the Common Shares, par value $1.00
per share, of the Company.
"Company" means Leucadia National Corporation, a New York
corporation, until a successor replaces such Person in accordance with the terms
of this Indenture, and thereafter means such successor.
"Consolidated Debt" means, on any date, the sum of (i) total
Indebtedness of the Company and its Subsidiaries, at such date, determined in
accordance with GAAP on a consolidated basis, and (ii) the aggregate liquidation
preference of all Preferred Stock of Subsidiaries of the Company, at such date,
other than Preferred Stock to the extent held by the Company and its
Subsidiaries; provided, that Consolidated Debt shall not include Permitted
Indebtedness.
"Consolidated Net Income" and "Consolidated Net Loss" mean, for
any period, the net income or loss, as the case may be, of the Company and its
Subsidiaries for such period determined on a consolidated basis in accordance
with GAAP (provided, that, for periods ended prior to January 1, 1995,
Consolidated Net Income shall mean the reported income before cumulative effects
of changes in accounting principles of the Company and its Subsidiaries);
provided, that there shall be excluded therefrom (to the extent otherwise
included therein) (i) the net income (or net loss) of any Person that is not the
Company or a Subsidiary of the Company, except net income of such Person may be
included to the extent of the amount of dividends or other distributions
actually paid or made to the Company or any of its Subsidiaries by such other
Person during such period, (ii) except to the extent includible pursuant to the
foregoing clause (i), the net income (or net loss) of any other Person accrued
prior to the date it becomes a Subsidiary of the Company or is merged into or
consolidated with the Company or any of its Subsidiaries or such other Person's
assets are acquired by the Company or any of its Subsidiaries,
<PAGE>
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-4-
(iii) all extraordinary gains, to the extent they exceed extraordinary losses,
in each case, determined in accordance with GAAP and (iv) all gains or losses
resulting from the effect of any accounting change.
"Consolidated Net Worth" means, as of any date, the sum of the
Capital Stock and additional paid-in capital plus retained earnings (or minus
accumulated deficit) of the Company as of such date determined on a consolidated
basis in accordance with GAAP.
"Consolidated Tangible Net Worth" with respect to the Company
means, as of any date, the total shareholders' equity of the Company determined
in accordance with GAAP less (a) (to the extent not otherwise deducted from
total shareholders' equity at such date) the amount of Restricted Investments of
the Company and its Subsidiaries outstanding on such date and (b) any and all
goodwill and other intangible assets reflected on the consolidated balance sheet
of the Company as of such date. Deferred policy acquisition costs ("DPAC") and
that portion of the value of insurance in force resulting from an acquisition
and equivalent to the amount of DPAC of the acquired entity outstanding
immediately prior to such acquisition shall not be deemed goodwill or other
intangible assets for purposes of determining Consolidated Tangible Net Worth.
"Default" means any event which is, or after notice or passage of
time would be, an Event of Default.
"8 1/4% Notes" means the Company's 8 1/4% Senior Subordinated
Notes due 2005.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
"5 1/4% Debentures" mean the Company's 5 1/4% Convertible
Subordinated Debentures due 2003.
"GAAP" or "generally accepted accounting principles" means United
States generally accepted accounting principles as in effect on December 31,
1995, without giving effect to the Company's adoption after such date of any
change in its application of GAAP.
"Holder" or "Securityholder" means a Person in whose name a
Security is registered on the Registrar's books.
<PAGE>
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-5-
"Indebtedness" of any Person means (i) any liability of such
Person (a) for borrowed money, (b) evidenced by a note, debenture or similar
instrument (including a Purchase Money Obligation or deferred payment
obligation) given in connection with the acquisition of any property or assets
(other than inventory or similar property acquired in the ordinary course of
business), including securities, (c) for the payment of a Capitalized Lease
Obligation of such Person or (d) with respect to the reimbursement of any letter
of credit, banker's acceptance or similar credit transaction (other than trade
letters of credit issued in the ordinary course of business; provided, that the
failure to make prompt reimbursement of any trade letter of credit shall be
deemed to be the incurrence of Indebtedness); and (ii) any guarantee by such
Person of any liability of others described in clause (i) above or any
obligation of such Person with respect to any liability of others described in
clause (i) above. Indebtedness shall not include deposits at the Company's
banking and lending Subsidiaries.
"Indenture" means this Indenture as amended or supplemented from
time to time.
"Independent Director" means any director of the Company who is
neither (i) an executive officer or an employee of the Company or of any of its
Subsidiaries or Affiliates or (ii) a Related Person.
"Investment" means any direct or indirect advance, loan (other
than advances or loans to customers in the ordinary course of business, which
are recorded at the time made as accounts receivable on the balance sheet of the
Person making such advance or loan) or other extension of credit or capital
contribution to (by means of any transfer of cash or other property to others or
any payment for property or services for the account or use of others), or any
purchase or acquisition of Capital Stock, bonds, notes, debentures, evidences of
Indebtedness or other securities issued by, any other Person.
"Investment Grade" is defined as BBB- or higher by S&P or Baa3 or
higher by Moody's or the equivalent of such ratings by Moody's or S&P.
"Investment Grade Securities" means (i) securities having any of
the following ratings: at least BBB- or the equivalent thereof by S&P or at
least Baa3 or the equivalent thereof by Moody's or at least BBB- or the
equivalent thereof by Duff & Phelps or (ii) cash or Cash Equivalents.
<PAGE>
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-6-
"Material Subsidiary" means (i) any Subsidiary of the Company
which at December 31, 1995 was a "significant subsidiary" under Regulation S-X
promulgated by the SEC or any successor to such Subsidiary and (ii) any other
Subsidiary of the Company; provided, that the Company's investments in and
advances to such Subsidiary at the date of determination thereof, without giving
effect to any write downs in such investments or advances taken within the prior
12 months, represent 20% or more of the Company's Consolidated Tangible Net
Worth as of such time; provided, however, that this clause (ii) shall not
include any Subsidiary if, at the time that it became a Subsidiary, the Company
contemplated commencing a voluntary case or proceeding under the Bankruptcy Law
with respect to such Subsidiary.
"Minimum Tangible Net Worth" means $250,000,000.
"Obligations" means any principal, interest, penalties, fees,
indemnities and other obligations and liabilities payable under the
documentation governing the applicable Indebtedness.
"Officer" means the Chairman of the Board, the President, any
Vice President, the Chief Financial Officer or the Treasurer of the Company.
"Officers' Certificate" means a certificate signed by two
Officers or by an Officer and the Secretary, Assistant Secretary or Assistant
Treasurer of the Company.
"Opinion of Counsel" means a written opinion from legal counsel
who is reasonably acceptable to the Trustee. The counsel may be an employee of
or counsel to the Company or the Trustee.
"Permitted Indebtedness" means (i) any Indebtedness of the
Company and its Subsidiaries outstanding on the date of this Indenture or any
refinancing or replacement thereof; provided, that the aggregate amount of such
Indebtedness is not increased, (ii) Acquired Indebtedness, (iii) Preferred Stock
of Subsidiaries held by the Company or its Subsidiaries (it being understood
that the sale of such Preferred Stock by the Company or such Subsidiary to any
Person other than the Company or a Subsidiary of the Company or such Subsidiary
no longer being a Subsidiary shall be deemed the issuance of Preferred Stock for
purposes of Section 3.12) and (iv) intercompany Indebtedness.
<PAGE>
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"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Stock" of an entity means the Capital Stock of that
entity which is preferred as to the payment of dividends or the distribution of
assets on any voluntary or involuntary liquidation, over the shares of any other
class or series of Capital Stock of said entity.
"principal" of a debt security means the principal amount of the
security plus the premium, if any, on the security.
"Purchase Money Obligations" means indebtedness evidenced by a
note, debenture, bond or other security or investment (whether or not secured by
any lien or other security interest) issued to or assumed in favor of a vendor
as all or part of the purchase price of property acquired by the Company or any
Subsidiary; provided, however, that such term shall not include any account
payable or any other indebtedness incurred, created or assumed in the ordinary
course of business in connection with the obtaining of material, products or
services.
"Related Person" means any Person who directly or indirectly
holds 10% or more of any class of Capital Stock of the Company as determined
pursuant to Rule 13d-3 under the Exchange Act.
"Restricted Investment" means, with respect to the Company or any
Subsidiary of the Company, an Investment by such Person in an Affiliate of the
Company (other than (x) in the Company or a Subsidiary of the Company or (y) in
a Person that is an Affiliate of the Company solely because of (i) the ownership
of securities of such Person by the Company or its Subsidiaries, (ii)
contractual arrangements between the Company and its Subsidiaries and such
Person or (iii) a combination of (i) and (ii)).
"Restricted Payment" means (i) the declaration or making of any
dividend or of any other payment or distribution on or with respect to the
Company's Capital Stock (other than dividends, payments or distributions payable
solely in shares of the Company's Capital Stock), (ii) any payment on account of
the purchase, redemption, retirement or other acquisition for value of the
Company's Capital Stock; provided, that so long as
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-8-
there shall not be a Default or Event of Default under this Indenture, any
payment to the estate of Ian M. Cumming or Joseph S. Steinberg (or any trustee
or other legal representative on behalf of the legatees or heirs of such
Persons) on account of the repurchase or redemption of Voting Stock owned by
such estates (or trustees or legal representatives), solely from the net
proceeds of any life insurance maintained by the Company on either of such
Persons, shall not be a Restricted Payment and (iii) the declaration or making
of any dividend or any other payment or distribution with respect to the Capital
Stock of any Subsidiary of the Company and any payment on account of the
purchase, redemption, retirement or other acquisition for value of the Capital
Stock of any Subsidiary of the Company but, with respect to this clause (iii),
only to the extent such dividend, payment or distribution is received by an
Affiliate of the Company (other than (x) the Company or a Subsidiary of the
Company or (y) a Person that is an Affiliate of the Company solely because of
(A) the ownership of securities of such Person by the Company or its
Subsidiaries, (B) contractual arrangements between the Company and its
Subsidiaries and such Person or (C) a combination of (A) and (B)).
"SEC" means the Securities and Exchange Commission.
"Securities" means the securities, as amended or supplemented
from time to time, that are issued and outstanding under this Indenture.
"Senior Indebtedness" means all Obligations of the Company with
respect to the following, whether outstanding at the date of original execution
of this Indenture or thereafter incurred, created or assumed: (a) indebtedness
of the Company for money borrowed, including, without limitation, indebtedness
of the Company for money borrowed which is evidenced by notes, debentures, bonds
or other securities issued under the provisions of an indenture or other
instrument, and also including indebtedness represented by Purchase Money
Obligations, but only to the extent such indebtedness is enforceable by a money
judgment; (b) guarantees or assumptions by the Company of indebtedness of others
of any of the kinds described in the preceding clause (a); and (c) renewals,
extensions and refundings of, and indebtedness of a successor corporation issued
in exchange for or in replacement of, indebtedness, guarantees and assumptions
of the kinds described in the preceding clauses (a) or (b), unless, in the case
of any particular indebtedness, obligation, guarantee, assumption, renewal,
extension or refunding, the instrument creating or evidencing
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-9-
the same expressly provides that such indebtedness, obligation, guarantee,
assumption, renewal, extension or refunding is not superior in right of payment
to the Securities; provided, that Senior Indebtedness shall not be deemed to
include (i) any indebtedness of the Company to any Subsidiary, (ii) any
liability for taxes, (iii) any amounts payable or other liabilities to trade
creditors arising in the ordinary course of business, (iv) any indebtedness
which is subordinate or junior by its terms to any other Indebtedness of the
Company, (v) the 10 3/8% Notes, (vi) the 8 1/4% Notes or (vii) the 5 1/4%
Debentures.
"Subsidiary" means a corporation or business trust a majority of
whose Voting Stock is owned by the Company or a Subsidiary.
"10 3/8% Notes" means the Company's 10 3/8% Senior Subordinated
Notes due 2002.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
ss.ss. 77aaa-77bbbb) as in effect on the date of this Indenture.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and thereafter means the successor.
"Trust Officer" means any officer or assistant officer within the
corporate trust department of the Trustee assigned by the Trustee to administer
its corporate trust matters.
"United States" means the United States of America.
"U.S. Legal Tender" means such coin or currency of the United
States as at the time of payment shall be legal tender for the payment of public
and private debts.
"Voting Stock" with respect to any Person, means Capital Stock of
such Person having general voting power under ordinary circumstances to elect
directors to the board of directors of such Person, but shall not include any
Capital Stock that has or would have such voting power solely by reason of the
happening of any contingency.
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"Wholly-Owned Subsidiary" means any Subsidiary in which the
Company or a Subsidiary owns all of the Capital Stock, other than directors
qualifying shares.
SECTION 1.02. Other Definitions.
<TABLE>
<CAPTION>
Defined
Term in Section
---- ----------
<S> <C>
"Bankruptcy Law"................................................ 5.01
"Certain Payment or
Investment Notice"............................................ 3.15
"Certain Payment or Investment
Payment Date"................................................. 3.15
"Change of Control"............................................. 3.11
"Change of Control Notice"...................................... 3.11
"Change of Control Payment Date"................................ 3.11
"Custodian"..................................................... 5.01
"Deficiency Date"............................................... 3.10
"Disposition"................................................... 3.11
"Event of Default".............................................. 5.01
"Legal Holiday"................................................. 10.08
"Offer"......................................................... 3.10
"Offer Amount".................................................. 3.10
"Offer Payment Date"............................................ 3.10
"Paying Agent".................................................. 2.03
"Recipient"..................................................... 3.11
"Registrar"..................................................... 2.03
"U.S. Government Obligations"................................... 7.01
</TABLE>
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms, if used in this Indenture, have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a securityholder.
"indenture to be qualified" means this Indenture.
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"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company.
All other TIA terms used in this indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule have
the meanings assigned to them therein.
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted
accounting principles;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words
in the plural include the singular;
(5) any gender used in this Indenture shall be deemed to
include the neuter, masculine or feminine genders;
(6) provisions apply to successive events and
transactions; and
(7) "herein", "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other Subdivision.
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ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the certificate of authentication shall be
substantially in the form of Exhibit A. The provisions of Exhibit A are part of
this Indenture. The Securities may have notations, legends and endorsements
required by law, stock exchange rule or usage. The Company shall approve the
form of the Securities and any notation, legend or endorsement on them. Each
Security shall be dated the date of its authentication.
SECTION 2.02. Execution and Authentication.
One Officer and the Secretary or an Assistant Secretary of the
Company shall sign the Securities for the Company by facsimile signature. The
Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds
that office at the time the Security is authenticated, the Security shall be
valid nevertheless.
A Security shall not be valid until the Trustee or an
authenticating agent manually signs the certificate of authentication on the
Security. The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee or an authenticating agent shall authenticate
Securities for original issue in the aggregate principal amount of $135,000,000,
upon a written order of the Company signed by two Officers or by an Officer and
the Secretary or an Assistant Secretary of the Company. The aggregate principal
amount of Securities outstanding at any time may not exceed $135,000,000, except
as provided in Section 2.07.
The Trustee may appoint an authenticating agent to authenticate
Securities. An authenticating agent may authenticate Securities whenever the
Trustee may do so except on original issuance. Each reference in this Indenture
to authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
its Affiliates.
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The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where Securities
may be presented for registration of transfer or for exchange (the "Registrar")
and an office or agency where Securities may be presented for payment (the
"Paying Agent"). The Registrar shall keep a register of the Securities and of
their transfer and exchange. The Company may have one or more co-registrars and
one or more additional paying agents. The term "Paying Agent" includes any
additional paying agent.
The Company shall enter into an appropriate agency agreement with
any Agent not a party to this Indenture. Such agency agreement shall provide for
reasonable compensation for such services. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall notify
the Trustee of the name and address of any such Agent and shall furnish the
Trustee with an executed counterpart of any such agency agreement. If the
Company fails to maintain or act as Registrar or Paying Agent, the Trustee shall
act as such and shall be duly compensated therefor.
The Registrar or a co-registrar and a Paying Agent shall be
maintained by the Company in the Borough of Manhattan, The City of New York. The
Company initially designates the Trustee as the Registrar and Paying Agent.
SECTION 2.04. Paying Agent To Hold Money in Trust.
On or prior to each due date of the principal and interest on any
Security, the Company shall deposit with the Paying Agent immediately available
funds sufficient to pay such principal and interest becoming due. The Company
shall require each Paying Agent other than the Trustee to hold in trust for the
benefit of Securityholders or the Trustee all money held by such Paying Agent
for the payment of principal or interest on the Securities, and shall notify the
Trustee of any Default by the Company in making any such payment. While any such
Default continues, the Trustee may require the Paying Agent to pay all money
held by it to the Trustee. Except as provided in the immediately preceding
sentence, the Company at any time may require a Paying Agent to pay all money
held by it to the Trustee. Upon doing so, such Paying Agent (other than the
Company
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or a Subsidiary) shall have no further liability for the money. If the Company
acts as Paying Agent, it shall segregate and hold as separate trust funds all
money held by it as Paying Agent.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders and shall otherwise comply with TIA ss. 312(a). If the Trustee
is not the Registrar, the Company shall furnish or cause to be furnished to the
Trustee on or before each semiannual interest payment date and at such other
times as the Trustee may request in writing a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of
Securityholders, and the Company shall otherwise comply with TIA ss. 312(a).
SECTION 2.06. Transfer and Exchange.
When a Security is presented to the Registrar or a co-registrar
with a request to register a transfer, the Registrar shall register the transfer
as requested if the requirements of the Registrar are met. When Securities are
presented to the Registrar or a co-registrar with a request to exchange them for
an equal principal amount of Securities of other denominations, the Registrar
shall make the exchange as requested if the requirements of the Registrar are
met. The Company shall cooperate with the Registrar in meeting its requirements.
To permit transfers, registration and exchanges, the Trustee shall authenticate
Securities at the Registrar's request. The Company may charge a reasonable fee
for any transfer, registration or exchange and may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto, but not for any exchange pursuant to Sections 2.09 or 8.05.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the
Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Security if the requirements of the Trustee are met. An indemnity
bond may be required by the Trustee or the Company that is sufficient in the
judgment of the Company and the Trustee to protect the Company, the Trustee or
any Agent from any loss which any
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of them may suffer if a Security is replaced. The Company may charge for its
expenses in replacing a Security.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all Securities
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation and those described in this Section 2.08 as not
outstanding. Subject to Section 10.06, a Security does not cease to be
outstanding because the Company or one of its Subsidiaries or Affiliates holds
the Security.
If a Security is replaced pursuant to Section 2.07, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If any Paying Agent (other than the Company or a Subsidiary)
holds on the maturity date money received by the Paying Agent pursuant to this
Indenture and sufficient to pay the principal and interest on Securities payable
on that date, then on and after that date such Securities cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Temporary Securities.
Until definitive Securities are ready for delivery, the Company
may prepare and the Trustee shall authenticate the temporary Securities.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Securities in exchange for temporary
Securities surrendered to it.
SECTION 2.10. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Securities surrendered to them for transfer, exchange or payment. The Trustee
and no one else shall cancel all Securities surrendered for registration,
transfer, exchange, payment or cancellation and shall destroy cancelled
Securities unless the Company directs their return to the Company. The Company
may not issue new Securities to
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replace Securities that it has paid or delivered to the Trustee for
cancellation.
SECTION 2.11. Defaulted Interest.
If the Company defaults in a payment of interest on the
Securities, it shall pay the defaulted interest plus any interest payable on the
defaulted interest to the persons who are Securityholders on a subsequent
special record date. The Company shall fix the record date and payment date. At
least 10 days before the record date, the Company shall mail to each
Securityholder a notice that states the record date, the payment date, and the
amount of defaulted interest to be paid. The Company may pay defaulted interest
in any other lawful manner.
ARTICLE THREE
COVENANTS
SECTION 3.01. Payment of Securities.
The Company shall pay the principal of and interest on the
Securities on the dates and in the manner provided in the Securities. An
installment of principal or interest shall be considered paid on the date it is
due if the Trustee or Paying Agent holds such installment in immediately
available funds at 9:00 A.M. on the date such installment is due.
The Company shall pay interest on overdue principal at the rate
borne by the Securities; it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
SECTION 3.02. SEC Reports.
(a) The Company shall file with the Trustee within 15 days after
it files them with the SEC copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the
Company is not subject to the requirements of such Section 13 or 15(d) of the
Exchange Act, the Company shall continue to file with the Trustee on the same
timely basis such reports, information and other documents as
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it would file if it were subject to the requirements of Section 13 or 15(d) of
the Exchange Act. The Company also shall comply with the other provisions of TIA
ss. 314(a).
(b) So long as any of the Securities remain outstanding, the
Company shall cause each annual, quarterly and other financial report mailed or
otherwise furnished by it generally to stockholders to be filed with the Trustee
and mailed to the Holders at their addresses appearing in the register of
Securities maintained by the Registrar, in each case at the time of such mailing
or furnishing to stockholders. If the Company is not required to furnish annual
or quarterly reports to its stockholders pursuant to the Exchange Act, the
Company shall cause its financial statements, including any notes thereto and,
with respect to annual reports, an auditors' report by an accounting firm of
established national reputation and a "Management's Discussion and Analysis of
Financial Condition and Results of Operations," comparable to that which would
have been required to appear in annual or quarterly reports filed under Section
13 or 15(d) of the Exchange Act, to be so filed with the Trustee within 120 days
after the end of each of the Company's fiscal years and within 60 days after the
end of each of the first three quarters of each such fiscal year and, after the
date such reports are so required to be filed with the Trustee, to be furnished
to any Holder upon such Holder's request.
(c) The Company shall provide the Trustee with a sufficient
number of copies of all reports and other documents and information that the
Trustee may be required to deliver to Securityholders under this Section 3.02.
SECTION 3.03. Compliance Certificate.
The Company shall deliver to the Trustee within 120 days after
the end of each fiscal year of the Company (which as of the date of this
Indenture is December 31) an Officers' Certificate stating whether or not the
signers know of any Default or Event of Default. If they do know of such a
Default or Event of Default, the certificate shall describe the Default or Event
of Default and efforts to remedy the same. The Company shall notify the Trustee
within 10 days following the occurrence thereof of any acceleration which is an
Event of Default within the meaning of Section 5.01(4).
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SECTION 3.04. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, The City
of New York, an office or agency where Securities may be surrendered for
registration of transfer or exchange or for presentation for payment and where
notices and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 10.02.
The Company may also from time to time designate one or more
other offices or agencies where the Securities may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations; provided, that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such purposes. The Company
will give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
SECTION 3.05. Corporate Existence.
Subject to Article Four, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its corporate
existence and the corporate, partnership or other existence of each Material
Subsidiary in accordance with the respective organizational documents of each
Material Subsidiary and the rights (charter and statutory) and material
franchises of the Company and the Material Subsidiaries; provided, that the
Company shall not be required to preserve any such right or franchise, or the
corporate existence of any Material Subsidiary, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and that the loss thereof is not, and will not be,
adverse in any material respect to the Holders.
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SECTION 3.06. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law or any
usury law or other law, which would prohibit or forgive the Company from paying
all or any portion of the principal of and/or interest on the Securities as
contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture; and (to the
extent that it may lawfully do so) the Company hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
SECTION 3.07. Transactions with Affiliates.
The Company shall not, and shall not permit any Subsidiary to,
directly or indirectly, enter into any transaction or series of related
transactions with any Affiliate (other than (a) with the Company or a
Wholly-Owned Subsidiary or (b) the making of a Restricted Payment or Restricted
Investment otherwise permitted by Section 3.09), including, without limitation,
any loan, advance or investment or any purchase, sale, lease or exchange of
property or the rendering of any service, unless such transaction or series of
transactions is in good faith and at arm's-length and on terms which are at
least as favorable as those available in a comparable transaction from an
unrelated Person. Any such transaction that involves in excess of $10,000,000
shall be approved by a majority of the Independent Directors on the Board of
Directors of the Company; or, in the event that at the time of any such
transaction or series of related transactions there are no Independent Directors
serving on the Board of Directors of the Company, such transaction or series of
related transactions shall be approved by a nationally recognized expert with
experience in appraising the terms and conditions of the type of transaction for
which approval is required.
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SECTION 3.08. Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.
The Company shall not, and shall not permit any Subsidiary to,
directly or indirectly, create or otherwise cause to exist or become effective
any encumbrance or restriction on the ability of any Subsidiary to (a) pay
dividends or make any other distributions on its Capital Stock or any other
interest or participation in, or measured by, its profits, owned by the Company
or any Subsidiary, or pay any Indebtedness owed to the Company or any
Subsidiary, (b) make loans or advances to the Company or any Subsidiary or (c)
transfer any of its properties or assets to the Company, except for such
encumbrances or restrictions existing under or by reasons of (i) applicable law,
(ii) this Indenture, (iii) customary provisions restricting subletting or
assignment of any lease governing a leasehold interest of the Company or any
Subsidiary, (iv) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the properties or
assets of any Person, other than such Person and its Subsidiaries, or the
property or assets of such Person and its Subsidiaries, so acquired, (v)
Indebtedness existing on the date of this Indenture and any refinancing of such
existing Indebtedness so long as the terms and conditions of any such
refinancing agreements are no less favorable to the Company than those contained
in the agreements governing the Indebtedness being refinanced or (vi) other
Indebtedness; provided, that the Board of Directors of the Company shall have
concluded, in good faith, that the terms thereof do not have a materially
adverse effect on the Company, on a stand-alone basis, or the Company's ability,
on a stand-alone basis, to meet its obligations.
SECTION 3.09. Limitation on Restricted Payments
and Restricted Investments.
The Company shall not, and shall not permit any Subsidiary to,
make, directly or indirectly, any Restricted Payment or Restricted Investment
if, immediately after giving effect to such Restricted Payment or Restricted
Investment, as the case may be: (a) a Default or Event of Default shall have
occurred and be continuing, (b) the Company's Consolidated Tangible Net Worth
would be less than $250,000,000, (c) the Company would not be permitted to incur
at least $1.00 of additional Indebtedness (other than Permitted Indebtedness)
pursuant to Section 3.12(a) hereof or (d) the sum of (x) the aggregate amount
expended for all Restricted Payments subsequent to March 31, 1992 and (y) the
aggregate amount of Restricted
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Investments made subsequent to March 31, 1992 and then outstanding reduced by
any write down of any such Restricted Investment to the extent that such write
down otherwise reduced Consolidated Net Income (the amount so expended for a
Restricted Payment or a Restricted Investment, if other than in cash, to be
determined by the Board of Directors of the Company, whose determination shall
be conclusive and evidenced by a Board Resolution) would exceed the sum of (1)
$35,000,000, (2) 50% of the aggregate Consolidated Net Income of the Company (or
minus 100% of the aggregate Consolidated Net Loss of the Company) accrued on a
cumulative basis subsequent to March 31, 1992, and (3) the aggregate net
proceeds, including the fair value of property other than cash (as determined by
the Board of Directors of the Company, whose determination shall be conclusive
and evidenced by a Board Resolution), received by the Company in respect of the
issue or sale subsequent to March 31, 1992 of (i) any shares of Capital Stock of
the Company, or (ii) any Indebtedness of the Company to the extent converted
into or exchanged for Capital Stock of the Company subsequent to March 31, 1992.
This Section 3.09 shall not prevent (x) the payment of any dividend or
distribution within 60 days after the date of declaration thereof, if at such
date of declaration such payment complied with the foregoing provisions, or (y)
the retirement of any shares of the Company's Capital Stock by exchange for, or
upon conversion of, or out of the proceeds of the substantially concurrent sale
(other than to a Subsidiary) of, other shares of the Capital Stock of the
Company, and neither such retirement, exchange or conversion nor the proceeds of
any such sale shall be included in any computation made under this Section 3.09.
SECTION 3.10. Maintenance of Consolidated Tangible Net Worth.
(a) If, on the last day of each of any two consecutive fiscal
quarters of the Company (the last day of the second such fiscal quarter being
referred to as the "Deficiency Date"), the Company's Consolidated Tangible Net
Worth is less than the Minimum Tangible Net Worth, then the Company shall, no
later than 65 days after each such Deficiency Date (110 days if such Deficiency
Date is the last day of the Company's fiscal year), make an offer to all Holders
to purchase (an "Offer") 10% of the aggregate principal amount of Securities
originally issued (the "Offer Amount") at a purchase price of 100% of the
principal amount of such Securities, plus accrued interest to the date of
purchase. The Offer shall remain open for a period of 20 business days following
its commencement (unless required to remain open for a longer period by
applicable law) and the
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Company shall purchase for cash the Offer Amount of Securities on a designated
date (the "Offer Payment Date") no later than five business days after the
termination of the Offer or, if less than the Offer Amount has been tendered,
all Securities then tendered; provided, however, that the Company shall not be
obligated to purchase any of such Securities unless Holders of at least 10% of
the Offer Amount of Securities shall have tendered and not subsequently
withdrawn their Securities for repurchase. If the aggregate principal amount of
Securities tendered to the Company exceeds the Offer Amount, the Company shall
purchase the Securities tendered to it pro rata among such Securities tendered
(with such adjustments as may be appropriate so that only Securities in
denominations of $1,000 and integral multiples thereof shall be purchased). The
Company shall comply with all applicable Federal and state securities laws in
connection with each Offer. In no event shall the failure of the Company's
Consolidated Tangible Net Worth to equal or exceed the Minimum Tangible Net
Worth at the end of any fiscal quarter be counted toward the making of more than
one Offer.
(b) The Company may reduce the principal amount of Securities to
be purchased pursuant to the Offer by subtracting 100% of the principal amount
of Securities acquired by the Company subsequent to the Deficiency Date through
purchase (otherwise than pursuant to this Section 3.10 or Section 3.11 or 3.15
hereof) or exchange, and surrendered for cancellation. The Company, however, may
not credit Securities that have been previously used as a credit against any
obligation to repurchase Securities pursuant to this Section 3.10. The Company
shall notify the Trustee prior to the making of any Offer whether the Company
elects to reduce the principal amount of Securities to be purchased pursuant to
an Offer as provided above and set forth the amount of the credit and the basis
provided above for such credit (including identification of any previously
cancelled Securities not theretofore made the basis for the credit), and shall
deliver such Securities with such notice.
(c) The Company shall furnish the Trustee with an Officers'
Certificate (upon which the Trustee may conclusively rely) notifying the Trustee
that Consolidated Tangible Net Worth has declined below the Minimum Tangible Net
Worth at the end of any fiscal quarter in which Consolidated Tangible Net Worth
has so declined, if such quarter is one of the first three quarters of any
fiscal year of the Company, within 55 days after the end of such quarter and, if
such quarter is the fourth quarter of any fiscal year of the Company, within 100
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days after the end of such fiscal year; provided, that the Trustee shall receive
such Officers' Certificate at least 15 days prior to any Offer pursuant to
Section 3.10(a) and any Notice of Offer pursuant to Section 3.10(d). The Trustee
shall notify the Holders within 10 days after it receives each such notice.
Failure to give such notice shall not affect the obligations of the Company
pursuant to this Section 3.10.
(d) Notice of an Offer shall be prepared and sent, by first class
mail, by the Company to all Holders not less than 30 days nor more than 60 days
before the Offer Payment Date at their last registered address. The notice shall
be accompanied by a copy of the information regarding the Company required to be
contained in a Quarterly Report filed pursuant to the Exchange Act on Form 10-Q
(x) for the Company's first fiscal quarter if the Deficiency Date is the last
day of the Company's second fiscal quarter, (y) for the Company's second fiscal
quarter if the Deficiency Date is the last day of the Company's third fiscal
quarter or (z) for the Company's third fiscal quarter if the Deficiency Date is
the last day of the Company's last fiscal quarter. If the Deficiency Date is the
last day of the Company's first fiscal quarter, a copy of the information
required to be contained in an Annual Report to Shareholders pursuant to Rule
14a-3 under the Exchange Act for the fiscal year ending immediately prior to
such Deficiency Date, if available, and in an Annual Report filed pursuant to
the Exchange Act on Form 10-K for such fiscal year shall accompany the notice.
If the Company is not subject to the requirements of Section 13 or 15(d) of the
Exchange Act, the notice shall be accompanied by financial statements, including
any notes thereto (and, in the case of a fiscal year end, an auditors' report of
a firm of established national reputation reasonably satisfactory to the
Trustee), comparable to that which the Company would have been required to
include in such Quarterly Reports or Annual Report to Shareholders, as the case
may be. The notice shall contain all instructions and materials necessary to
enable such Holders to tender Securities pursuant to the Offer. The notice,
which shall govern the terms of the Offer, shall state:
(1) that the Offer is being made pursuant to this
Section 3.10;
(2) the Offer Amount, the purchase price (including the
amount of accrued interest) and the Offer Payment Date;
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(3) whether the Company has elected to reduce the principal
amount of Securities to be purchased pursuant to an Offer, and has
delivered to the Trustee for cancellation the Securities that are to be
made the basis for such reduction and, if so, the amount of such
Securities;
(4) that any Security not tendered or accepted for
payment will continue to accrue interest;
(5) that any Security accepted for payment pursuant to the Offer
becomes due and payable on the Offer Payment Date, and that, unless the
Company defaults in making payment therefor (including, without
limitation, if such default results because such payment is prohibited
pursuant to Article Nine hereof), such Security shall cease to accrue
interest after the Offer Payment Date;
(6) that Holders electing to have a Security purchased pursuant
to an Offer will be required to surrender the Security, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the
Security completed and, if the Offer Payment Date falls between any
record date for the payment of interest on the Securities and the next
succeeding interest payment date, an amount equal to the interest which
the Holder is entitled to receive on such interest payment date to the
Paying Agent at the address specified in the notice at least five days
before the Offer Payment Date;
(7) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than one business day prior to the
Offer Payment Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount and
certificate numbers of the Securities the Holder delivered for purchase
and a statement that such Holder is withdrawing his election to have the
Security purchased;
(8) that if Securities in a principal amount in excess of the
Offer Amount are tendered and not withdrawn pursuant to the Offer, the
Company shall purchase Securities on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only
Securities in denominations of $1,000 or integral multiples of $1,000
shall be acquired); and
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(9) that Holders whose Securities were purchased only in part
will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.
Before an Offer Payment Date, the Company shall (i) accept for
payment Securities or portions thereof tendered pursuant to the Offer (on a pro
rata basis if required pursuant to paragraph (8) above), (ii) deposit with the
Paying Agent U.S. Legal Tender and Securities, if any, acquired in the manner
described in clause (b), above, sufficient to pay the purchase price of all
Securities or portions thereof so accepted or to be credited against the Offer
Amount and (iii) deliver to the Trustee Securities so accepted together with an
Officers' Certificate stating the Securities or portions thereof accepted for
payment by the Company. The Paying Agent shall promptly mail or deliver to
Holders of Securities so accepted payment in an amount equal to the purchase
price, and the Company shall execute and the Trustee shall promptly authenticate
and mail or deliver to such Holders a new Security equal in principal amount to
any unpurchased portion of the Security surrendered. Any Securities not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company will publicly announce the results of the Offer as soon as
practicable on or after the Offer Payment Date. For purposes of this Section
3.10, the Trustee shall act as the Paying Agent.
SECTION 3.11. Change of Control.
(a) In the event of any Change of Control, each Holder shall have
the right, at such Holder's option, to require the Company to purchase all or
any portion (in integral multiples of $1,000) of such Holder's Securities on the
date (the "Change of Control Payment Date") which is 20 business days after the
date the Change of Control Notice (as defined below) is mailed (or such later
date as is required by applicable law) at 101% of the principal amount thereof,
plus accrued interest to the Change of Control Payment Date; provided, that the
Company shall not be obligated to purchase any of such Securities unless Holders
of at least 10% of the Securities outstanding at the Change of Control Payment
Date (other than Securities held by the Company and its Affiliates) shall have
tendered their Securities for repurchase. In addition, in the event of any
Change of Control, the Company will not, and will not permit any Subsidiaries
to, purchase or redeem any Indebtedness ranking junior to the Securities
pursuant to any
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analogous provisions prior to the Change of Control Payment Date.
(b) The Company, or at the request of the Company, the Trustee,
shall send, by first-class mail, postage prepaid, to all Holders, within five
business days after the occurrence of each Change of Control, a notice of the
occurrence of such Change of Control (the "Change of Control Notice"),
specifying a date by which a Holder must notify the Company of such Holder's
intention to exercise the repurchase right and describing the procedure that
such Holder must follow to exercise such right. The Company is required to
deliver a copy of such notice to the Trustee and to cause a copy of such notice
to be published in a daily newspaper of national circulation.
Each Change of Control Notice shall state:
(1) the Change of Control Payment Date;
(2) the date by which the repurchase right must be
exercised;
(3) the price at which the repurchase is to be made, if
the repurchase right is exercised; and
(4) a description of the procedure which the Holder must follow
to exercise a repurchase right.
No failure of the Company to give the foregoing notice shall
limit any Holder's right to exercise a repurchase right. The Company shall
comply with all applicable Federal and state securities laws in connection with
each Change of Control Notice.
(c) To exercise the repurchase right, the Holder shall deliver,
on or before the fifth calendar day prior to the Change of Control Payment Date,
written notice (which shall be irrevocable) to the Company (or an agent
designated by the Company for such purpose) of the Holder's exercise of such
right, together with (i) the Security or Securities with respect to which the
right is being exercised, duly endorsed for transfer, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Security completed,
and (ii) if the Change of Control Payment Date falls between any record date for
the payment of interest on the Securities and the next succeeding interest
payment date, an amount equal to the interest which
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the Holder is entitled to receive on such interest payment date.
(d) A "Change of Control" shall be deemed to occur if (i) the
Company has any other Indebtedness outstanding (other than Indebtedness under a
bank credit agreement or similar bank financing) which provides for a Change of
Control (as defined in the instrument governing such Indebtedness) if Ian M.
Cumming or Joseph S. Steinberg ceases to beneficially own, in the aggregate, a
certain percentage of the outstanding Common Shares, which percentage ownership
requirement is in excess of 10%, and a Change of Control (as defined in the
instrument governing such Indebtedness) occurs under such Indebtedness or (ii)
at any time when the Company does not have any other Indebtedness outstanding of
the type referred to in clause (i), Ian M. Cumming or Joseph S. Steinberg,
individually or in the aggregate, sells, transfers or otherwise disposes of (a
"Disposition"), after the date hereof, Common Shares so that, after giving
effect thereto, the sole beneficial ownership of outstanding Common Shares by
Mr. Cumming and/or Mr. Steinberg would, in the aggregate, fall below 10% of the
then outstanding Common Shares; provided, that no Change of Control shall be
deemed to have occurred under clause (ii) if the Securities are rated by Moody's
or S&P as Investment Grade both at the time of such Disposition and for a period
of 90 days from the date of such Disposition (it being understood that, with
respect to the foregoing proviso, a Change of Control shall be deemed to occur
on the first date during such 90-day period when the Securities are rated below
Investment Grade by both Moody's and S&P). The term "Common Shares" shall
include any securities issued as dividends or distributions on the Common
Shares. For purposes hereof, "sole beneficial ownership" of Common Shares shall
be deemed to include (i) all Common Shares received after June 15, 1992 from Mr.
Cumming or Mr. Steinberg by any member of their respective immediate families or
by any trust for the benefit of either of them or any member of their respective
immediate families (a "Recipient"), which Common Shares remain held by a
Recipient during the lifetime of Mr. Cumming or Mr. Steinberg (unless sold,
transferred or disposed of by such Recipient during the lifetime of Mr. Cumming
or Mr. Steinberg, as the case may be, in which case such Disposition by such
Recipient shall constitute a Disposition by Mr. Cumming or Mr. Steinberg, as the
case may be) and (ii) after the death of Mr. Cumming and/or Mr. Steinberg, all
Common Shares owned as of the date of death by the decedent, and any Recipient
of the decedent, regardless of whether such Recipient continues to own such
Common Shares after the date of death. In determining the number of
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outstanding Common Shares then held by Messrs. Cumming and Steinberg and the
total number of outstanding Common Shares, there shall be excluded Common Shares
issued by the Company after December 31, 1991, or the conversion into or
exchange for, after December 31, 1991, Common Shares or securities convertible
into or exchangeable for Common Shares.
SECTION 3.12. Limitation on Incurrence of Additional Indebtedness
by the Company and on Incurrence of Additional
Indebtedness and Issuance of Preferred Stock by Its
Subsidiaries.
(a) The Company shall not, and shall not permit any Subsidiary
to, create, incur, assume, or guarantee the payment of any Indebtedness, and
shall not permit any of its Subsidiaries to issue any Preferred Stock, if, at
the time of such event and after giving effect thereto on a pro forma basis, the
Company's ratio of Consolidated Debt to Consolidated Tangible Net Worth, as of
the most recent date for which consolidated financial statements are available
and adjusted for the incurrence of all Indebtedness and the issuance of all
Preferred Stock by Subsidiaries (other than Permitted Indebtedness) since that
date, would be greater than 1.75 to 1.
(b) Paragraph (a) of this Section 3.12 shall not preclude the
incurrence of Permitted Indebtedness.
SECTION 3.13. Limitation on Issuance of
Other Subordinated Debt.
The Company shall not issue, assume, guarantee, incur or
otherwise become liable, directly or indirectly, for any Indebtedness
subordinate or junior in ranking in any respect to any Senior Indebtedness but
senior in right of payment to the Securities.
SECTION 3.14. Restriction on Investments
by Insurance Subsidiaries.
The Company shall not permit any Subsidiary which is an insurance
company to make, directly or indirectly, any Investment other than in Investment
Grade Securities if, after giving effect thereto at the time of such Investment,
less than 80% of the aggregate Investments of such insurance company would
consist of Investment Grade Securities, valuing
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Investments for purposes of this restriction at original cost. The foregoing
restriction shall not (i) apply to Investments in the Company or any Subsidiary
of the Company, (ii) prevent the Company or its Subsidiaries from acquiring the
Capital Stock of, or all or substantially all of the assets of, an insurance
company or (iii) apply to securities issued in a restructuring or exchange offer
or similar transaction offered generally to all holders of another security then
held by such Subsidiary.
SECTION 3.15. Limitation on Certain Payments
or Investments.
(a) In the event of any Certain Payment or Investment, each
Holder shall have the right, at such Holder's option, to require the Company to
purchase all or any portion (in integral multiples of $1,000) of such Holder's
Securities on the date (the "Certain Payment or Investment Payment Date") which
is 20 business days after the date the Certain Payment or Investment Notice (as
defined below) is mailed (or such later date as is required by applicable law)
at 101% of the principal amount thereof, plus accrued interest to the Certain
Payment or Investment Payment Date; provided, that the Company shall not be
obligated to purchase any of such Securities unless Holders of at least 10% of
the Securities outstanding at the Certain Payment or Investment Payment Date
(other than Securities held by the Company and its Affiliates) shall have
tendered their Securities for repurchase. In addition, in the event of any
Certain Payment or Investment, the Company will not, and will not permit any
Subsidiaries to, purchase or redeem any Indebtedness ranking junior to the
Securities pursuant to any analogous provisions on or prior to the Certain
Payment or Investment Payment Date.
(b) The Company, or at the request of the Company, the Trustee,
shall send, by first-class mail, postage prepaid, to all Holders, within five
business days after the occurrence of each Certain Payment or Investment, a
notice of the occurrence of such Certain Payment or Investment (the "Certain
Payment or Investment Notice"), specifying a date by which a Holder must notify
the Company of such Holder's intention to exercise the repurchase right and
describing the procedure that such Holder must follow to exercise such right.
The Company is required to deliver a copy of such notice to the Trustee and to
cause a copy of such notice to be published in a daily newspaper of national
circulation.
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Each Certain Payment or Investment Notice shall state:
(1) the Certain Payment or Investment Payment Date;
(2) the date by which the repurchase right must be
exercised;
(3) the price at which the repurchase is to be made, if
the repurchase right is exercised; and
(4) a description of the procedure which the Holder must follow
to exercise a repurchase right.
No failure of the Company to give the foregoing notice shall
limit any Holder's right to exercise a repurchase right. The Company shall
comply with all applicable Federal and state securities laws in connection with
each Certain Payment or Investment Notice.
(c) To exercise the repurchase right, the Holder shall deliver,
on or before the fifth calendar day prior to the Certain Payment or Investment
Payment Date, written notice (which shall be irrevocable) to the Company (or an
agent designated by the Company for such purpose) of the Holder's exercise of
such right, together with (i) the Security or Securities with respect to which
the right is being exercised, duly endorsed for transfer, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Security completed,
and (ii) if the Certain Payment or Investment Payment Date falls between any
record date for the payment of interest on the Securities and the next
succeeding interest payment date, an amount equal to the interest which the
Holder is entitled to receive on such interest payment date.
ARTICLE FOUR
SUCCESSOR CORPORATION
SECTION 4.01. When Company May Merge, etc.
The Company shall not consolidate or merge with or into, or sell,
lease, convey or otherwise dispose of all or substantially all of its assets (it
being understood that a sale of less than 90% of the Company's total assets
shall not be deemed a sale of substantially all of the Company's assets),
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in one transaction or a series of related transactions, to any Person unless:
(1) the Person formed by or surviving any such consolidation or
merger (if other than the Company), or to which such sale, lease,
conveyance or other disposition shall have been made, is a corporation
organized and existing under the laws of the United States, any state
thereof or the District of Columbia;
(2) the corporation formed by or surviving any such consolidation
or merger (if other than the Company), or to which such sale, lease,
conveyance or other disposition shall have been made, assumes by
supplemental indenture in a form satisfactory to the Trustee all the
obligations of the Company under the Securities and this Indenture;
(3) immediately before and immediately after such
transaction no Default or Event of Default exists;
(4) the Company or any corporation formed by or surviving any
such consolidation or merger, or to which such sale, lease, conveyance
or other disposition shall have been made, would be permitted by the
provisions of Section 3.12(a) to incur $1.00 of additional Indebtedness
(other than Permitted Indebtedness); and
(5) the Company or any corporation formed by or surviving any
such consolidation or merger, or to which such sale, lease, conveyance
or other disposition shall have been made, shall immediately thereafter
have a Consolidated Net Worth (after purchase accounting adjustments) at
least equal to the Consolidated Net Worth of the Company immediately
preceding such transaction.
The Company shall deliver to the Trustee prior to the
consummation of the proposed transaction an Officers' Certificate to the
foregoing effect and an Opinion of Counsel stating that the proposed transaction
and such supplemental Indenture comply with this Indenture.
SECTION 4.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, lease, conveyance
or other disposition of all or substantially all of the assets of the Company in
accordance with Section 4.01, the successor corporation formed by such
consolidation or into
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which the Company is merged or to which such sale, lease, conveyance or other
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor corporation had been named as the Company herein.
ARTICLE FIVE
DEFAULTS AND REMEDIES
SECTION 5.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest on
any Security when the same becomes due and payable and such
default continues for a period of 30 days (and whether or not
such payment would be subject to Article Nine);
(2) the Company defaults in the payment of the principal
(including premium, if any) of any Security when the same becomes due
and payable at maturity or otherwise (and whether or not such payment
would be subject to Article Nine);
(3) the Company fails to comply with any of its other agreements
in the Securities or this Indenture and such default continues for the
period and after the notice specified below;
(4) the Company or any Material Subsidiary either (A) defaults in
the payment when due of principal of, interest on, or other amounts
payable in respect of, or (B) fails to perform or comply with any of its
other agreements in respect of, any of its respective Indebtedness
(other than the Securities) in the aggregate principal or like amount of
$15,000,000 or more, and such Indebtedness shall be or shall have been
declared to be due and payable immediately, and such acceleration shall
not have been rescinded or annulled;
(5) the Company or any Material Subsidiary pursuant to
or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
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(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of
it or for all or substantially all of its property, or
(D) makes a general assignment for the benefit of
its creditors, or
(6) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief (with respect to the petition commencing
such case) against the Company or any Material Subsidiary in an
involuntary case or proceeding,
(B) appoints a Custodian of the Company or any
Material Subsidiary or for all or substantially all of
its respective property, or
(C) orders the liquidation of the Company or any
Material Subsidiary,
and the order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) of this Section 5.01 is not an Event
of Default until the Trustee or the Holders of at least 25% in principal amount
of the Securities notify the Company of the Default and the Company does not
cure the Default within 30 days after receipt of the notice. The notice must
specify the Default, demand that it be remedied and state that the notice is a
"Notice of Default."
SECTION 5.02. Acceleration.
If an Event of Default (other than an Event of Default with
respect to the Company specified in clause (5) or (6) of Section 5.01) occurs
and is continuing, the Trustee by
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notice to the Company, or the Holders of at least 25% in aggregate principal
amount of the Securities then outstanding by notice to the Company and the
Trustee, may declare the principal of, and the accrued interest on, all of the
Securities then outstanding due and payable immediately. Upon such declaration
such principal and interest shall be due and immediately payable.
If an Event of Default with respect to the Company specified in
clause (5) or (6) of Section 5.01 occurs, all unpaid principal of and accrued
interest on the Securities then outstanding shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
Notwithstanding anything to the contrary in the preceding two
paragraphs, the Holders of a majority in principal amount of the Securities then
outstanding by notice to the Trustee may rescind an acceleration and its
consequences if all existing Events of Default have been cured or waived and if
the rescission would not conflict with any judgment or decree. When a Default or
Event of Default is cured or waived, it ceases to exist.
SECTION 5.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal or interest on the Securities or to enforce the performance
of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 5.04. Waiver of Past Defaults.
Subject to Sections 5.07 and 8.02, the Holders of a majority in
principal amount of the Securities by notice to the Trustee may waive an
existing Default or Event of Default and
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its consequences, except a Default or Event of Default in payment of principal
of, or interest on, any Security.
SECTION 5.05. Control by Majority.
The Holders of a majority in principal amount of the Securities
may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
it. However, the Trustee may refuse to follow any direction that conflicts with
law or this Indenture, that is unduly prejudicial to the rights of another
Securityholder, as such, or that would involve the Trustee in personal
liability.
SECTION 5.06. Limitation on Remedies.
Except as provided in Section 5.07, a Securityholder may not
pursue any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in principal amount of
the Securities make a written request to the Trustee to pursue
the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with the request has been given to
the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Securities.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
other Securityholders.
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SECTION 5.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right
of any Holder of a Security as set forth in this Indenture to receive payment of
principal of and interest on the Security, on or after the respective due dates
expressed in the Security, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired or affected
without the consent of such Holder.
SECTION 5.08. Collection Suit by Trustee.
If an Event of Default in payment of interest or principal
specified in Section 5.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount of principal and interest remaining unpaid and such
further amounts as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation and expenses of the Trustee,
its agents and counsel.
SECTION 5.09. Trustee May File Proofs of Claim.
(a) The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee and the Securityholders allowed in any judicial proceedings relative to
the Company, its creditors or its property.
(b) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Securityholder in
any such proceeding.
SECTION 5.10. Priorities.
If the Trustee collects any money pursuant to this Article Five,
it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section
6.07;
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Second: to Holders of Senior Indebtedness to the extent
required by Article Nine;
Third: to Securityholders for amounts due and unpaid on
the Securities for principal and interest, ratably, without
preference or priority of any kind, according to the amounts
due and payable on the Securities for principal and interest,
respectively; and
Fourth: To the Company.
The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section 5.10.
SECTION 5.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 5.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 5.07, or a suit by Holders of more than 10% in principal
amount of the then outstanding Securities.
ARTICLE SIX
TRUSTEE
SECTION 6.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise its rights and powers and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of
Default:
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(1) The Trustee need perform only those duties that are
specifically set forth (or incorporated by reference) in this Indenture
and no others.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Indenture. However, the Trustee shall examine such certificates and
opinions to determine whether or not they conform to the requirements of
this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph (c) does not limit the effect of
paragraph (b) of this Section.
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.05, and the Trustee shall be
entitled from time to time to request such a direction.
(d) Every provision of this Indenture that in any way relates to
the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall be under no obligation and may refuse to
perform any duty or exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
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SECTION 6.02. Rights of Trustee.
Subject to Section 6.01:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Trustee may rely on and shall be protected in acting or refraining from
acting upon any document believed by it to be genuine and to have been
signed or presented by the proper person. The Trustee shall not be bound
to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture or other paper or
document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and
premises of the Company, personally or by agent or attorney, to the
extent reasonably required by such inquiry or investigation.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee
shall not be liable for any action it takes or omits to take in good
faith in reliance on such certificate or opinion.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within
its rights or powers.
SECTION 6.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
its Subsidiaries or Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. However, the Trustee must
comply with Sections 6.10 and 6.11.
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SECTION 6.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Securities, it shall not be accountable for
the Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities other than its certificate of
authentication.
SECTION 6.05. Notice of Defaults.
If a Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to each Securityholder pursuant to Section 10.02
a notice of the Default within 90 days after it occurs. Except in the case of a
Default in any payment on any Security, the Trustee may withhold the notice if
and so long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Securityholders.
SECTION 6.06. Reports by Trustee to Holders.
Within 60 days after each May 15, beginning with May 15, 1997,
the Trustee shall mail to each Securityholder a brief report dated as of such
May 15 that complies with TIA ss. 313(a), but only if such report is required in
any year under TIA ss. 313(a). The Trustee also shall comply with TIA ss.ss.
313(b) and 313(c).
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange on which the
Securities are listed. The Company shall notify the Trustee in writing if the
Securities become listed on any national securities exchange or of any delisting
thereof.
SECTION 6.07. Compensation and Indemnity.
The Company shall pay the Trustee from time to time reasonable
compensation for its services (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust). The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses, disbursements and advances incurred by it. Such expenses
shall include the reasonable compensation and expenses of the Trustee's agents
and counsel.
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The Trustee shall not be under any obligation to institute any
suit, or take any remedial action under this Indenture, or to enter any
appearance or in any way defend any suit in which it may be a defendant, or to
take any steps in the execution of the trusts created hereby or thereby or in
the enforcement of any rights and powers under this Indenture, until it shall be
indemnified to its satisfaction against any and all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture, including compensation for services, costs,
expenses, outlays, counsel fees and other disbursements, and against all
liability not due to its negligence or willful misconduct. The Company shall
indemnify the Trustee against any loss or liability incurred by it in connection
with the acceptance and administration of the trust and its duties hereunder as
Trustee, Registrar and/or Paying Agent, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity;
however, unless the position of the Company is prejudiced by such failure, the
failure of the Trustee to promptly notify the Company shall not limit its right
to indemnification. The Company shall defend each such claim and the Trustee
shall cooperate in the defense. The Trustee may retain separate counsel and the
Company shall reimburse the Trustee for the reasonable fees and expenses of such
counsel. The Company need not pay for any settlement made without its consent.
The Company need not reimburse any expense or indemnify against
any loss or liability incurred by the Trustee through negligence or willful
misconduct.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to that of the Holders of the Securities on all
money or property held or collected by the Trustee, except that held in trust to
pay principal and interest on particular Securities.
When the Trustee incurs expenses or renders services after the
occurrence of any Event of Default specified in Sections 5.01(5) or (6), the
expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy law.
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SECTION 6.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company. The Holders
of a majority in principal amount of the Securities may remove the Trustee by so
notifying the Trustee in writing. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 6.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee becomes incapable of acting as Trustee
hereunder.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the Securities may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided for in Section 6.07, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. A successor Trustee shall mail notice of its succession to
each Securityholder.
If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of a majority in principal amount of the Securities may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 6.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a
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successor Trustee. Any successor Trustee shall comply with TIA ss. 310(a)(5).
SECTION 6.09. Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, the successor corporation without any further act shall be the
successor Trustee; provided such corporation or association shall be otherwise
eligible and qualified under this Article.
SECTION 6.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1). The Trustee shall always have a combined
capital and surplus of at least $50,000,000 as set forth in its most recent
published annual report of condition. The Trustee shall also comply with TIA ss.
310(b).
SECTION 6.11. Preferential Collection of
Claims Against Company.
The Trustee shall comply with TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE SEVEN
DISCHARGE OF INDENTURE
SECTION 7.01. Termination of Company's Obligations.
The Company may terminate all of its obligations under the
Securities and this Indenture if:
(a) all Securities previously authenticated and delivered (other
than destroyed, lost or stolen Securities which have been replaced or
paid) have been delivered to the Trustee for cancellation and the
Company has been paid all sums payable by it hereunder; or
(b) (1) the Securities mature within one year, and
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(2) the Company irrevocably deposits in trust with
the Trustee immediately available funds or U.S. Government
Obligations sufficient to pay principal and interest on the Securities
to maturity.
However, the Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07,
6.07 and 6.08 shall survive until the Securities are no longer outstanding.
Thereafter the Company's obligations in Section 6.07 shall survive.
Upon receipt, in the case of (a) or (b) above in this Section
7.01, by the Trustee of an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with, the
Trustee upon request shall acknowledge in writing the discharge of the Company's
obligations under the Securities and this Indenture except for those surviving
obligations specified above.
In order to have money available on a payment date to pay
principal or interest on the Securities, the U.S. Government Obligations shall
be payable as to principal or interest on or before such payment date in such
amounts as will provide the necessary money. U.S. Government Obligations shall
not be callable at the issuer's option.
The term "U.S. Government Obligations" means direct obligations
of the United States for the payment of which the full faith and credit of the
United States is pledged.
SECTION 7.02. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to Section 7.01. It shall apply the
deposited money and the money from U.S. Government Obligations through the
Paying Agent and in accordance with this Indenture to the payment of principal
and interest on the Securities. Money and securities so held in trust are not
subject to the subordination provisions of Article Nine and need not be
segregated from other funds except to the extent required by law.
SECTION 7.03. Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the
Company upon request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall
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pay to the Company upon request any money held by them for the payment of
principal or interest that remains unclaimed for two years; provided, however,
that the Trustee or such Paying Agent before being required to make any such
repayment, may at the expense of the Company cause to be published once in a
newspaper of general circulation in The City of New York or mail to each such
Holder notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such publication
or mailing any unclaimed balance of such money then remaining will be paid to
the Company.
SECTION 7.04. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or
U.S. Government Obligations in accordance with Section 7.01 by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 7.01 until such time as the Trustee or Paying Agent is permitted to
apply all such money or U.S. Government Obligations in accordance with Section
7.01; provided, however, that if the Company has made any payment of interest on
or principal of any Securities because of the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Securities
to receive such payment from the money or U.S. Government Obligations held by
the Trustee or Paying Agent.
ARTICLE EIGHT
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. Without Consent of Holders.
The Company may amend or supplement this Indenture or the
Securities without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Section 4.01;
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(3) to provide for uncertificated Securities in addition
to certificated Securities;
(4) to comply with any requirements of the SEC in order
to effect or maintain the qualification of this Identure under
the TIA; or
(5) to make any change that would provide any additional benefit
or rights to the Securityholders or that does not adversely affect the
rights of any Securityholder.
Notwithstanding the above, the Trustee and the Company may not
make any change that adversely affects the legal rights of any Securityholders
hereunder.
SECTION 8.02. With Consent of Holders.
Subject to Section 5.07, the Company, when authorized by a
resolution of its Board of Directors, may amend or supplement this Indenture or
the Securities with the written consent of the Holders of at least a majority in
principal amount of the Securities then outstanding, and the Holders of a
majority in principal amount of the Securities may waive compliance by the
Company with any provision of this Indenture or the Securities. However, without
the consent of each Securityholder affected, an amendment, supplement or waiver,
including a waiver pursuant to Section 5.04, may not:
(1) reduce the amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or change or extend the time for
payment of principal of or interest on any Security;
(3) reduce the principal of or change the fixed maturity
of any Security;
(4) waive a default in the payment of the principal of
or interest on any Security;
(5) make any Security payable in money other than that
stated in the Security;
(6) make any change in the subordination of the
Securities in a manner that is adverse to the Holders; or
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(7) make any change in this Section, Section 5.04 or
Section 5.07.
Notwithstanding the above and Section 5.07, the Holders of a
majority in principal amount of the Securities then outstanding may waive
compliance by the Company with Sections 3.10 and 3.11 of this Indenture.
It shall not be necessary for the consent of the Holders under
this Section 8.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof. Any amendment, waiver or consent shall be deemed effective
upon receipt by the Trustee of the necessary consents and shall not require
execution of any supplemental indenture to be effective.
After an amendment or waiver under this Section 8.02 becomes
effective, the Company shall mail to the Holders of each Security affected
thereby, with a copy to the Trustee, a notice briefly describing the amendment
or waiver. Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such amendment, waiver, consent or supplemental indenture. Except as otherwise
provided in this Section 8.02, the Holders of a majority in aggregate principal
amount of the Securities then outstanding may waive compliance in a particular
instance by the Company with any provisions of this Indenture or the Securities.
SECTION 8.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
SECTION 8.04. Revocation and Effect of Consents.
A consent to an amendment, supplement or waiver by a Holder of a
Security shall bind the Holder and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the consenting Holder's
Security, even if notation of the consent is not made on any Security. However,
until an amendment or waiver becomes effective, any such Holder or subsequent
Holder may revoke the consent as to his Security or portion of a Security. For
such revocation to be effective, the Trustee must receive the notice of
revocation before the date the amendment, supplement or waiver becomes
effective.
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After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder unless it makes a change described in any of
clauses (1) through (7) of Section 8.02. In that case the amendment, supplement
or waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security.
SECTION 8.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the Security shall issue
and the Trustee shall authenticate a new Security that reflects the changed
terms.
SECTION 8.06. Trustee Protected.
The Trustee shall sign any amendment or supplement or waiver
authorized pursuant to this Article if the amendment or supplement or waiver
does not adversely affect the rights of the Trustee. If it does adversely affect
the rights of the Trustee, the Trustee may but need not sign it. In signing such
amendment or supplement or waiver the Trustee shall be entitled to receive, and
(subject to Article Six) shall be fully protected in relying upon, an Opinion of
Counsel stating that such amendment or supplement or waiver is authorized or
permitted by and complies with this Indenture. The Company may not sign an
amendment or supplement until the Board of Directors approves it.
ARTICLE NINE
SUBORDINATION
SECTION 9.01. Securities Subordinated to Senior Indebtedness.
The Company agrees, and each Holder of the Securities by its
acceptance thereof likewise agrees, that the payment of all Obligations with
respect to the Securities is subordinated, to the extent and in the manner
provided in this Article, to the prior payment in full of all Senior
Indebtedness.
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This Article Nine shall constitute a continuing offer to all
persons who, in reliance upon such provisions, become holders of, or continue to
hold, Senior Indebtedness, and such provisions are made for the benefit of the
holders of Senior Indebtedness, and such holders and/or each of them may enforce
such provisions. No amendment of any provision of this Article Nine shall be
effective as against any holder of Senior Indebtedness who has not consented
thereto.
SECTION 9.02. Company Not To Make Payments with Respect
to Securities in Certain Circumstances.
(a) Upon the maturity of the principal of any Senior Indebtedness
by lapse of time, acceleration or otherwise, all Obligations thereon shall first
be paid in full, or such payment duly provided for in cash or in a manner
satisfactory to the holders of such Senior Indebtedness, before any payment is
made on account of any Obligations with respect to the Securities or to acquire
any of the Securities.
(b) Upon the happening of an event of default (or if any event of
default would result upon any payment with respect to the Securities) with
respect to any Senior Indebtedness, as such event of default is defined therein
or in the instrument under which it is outstanding, permitting the holders to
accelerate the maturity thereof, and, if the default is other than default in
payment of the principal or interest on such Senior Indebtedness (a "non-payment
default"), upon written notice thereof given to the Company and the Trustee by
the holders of such Senior Indebtedness or their representative, then, unless
and until such event of default shall have been cured or waived or shall have
ceased to exist, no payment shall be made by the Company of any Obligations with
respect to the Securities or to acquire any of the Securities; provided,
however, that in the event of a non-payment default, such payment blockage shall
not exceed a period of 179 days commencing on the date of receipt by the Company
of written notice of such non-payment default or event of default by a holder of
such Senior Indebtedness or by their representatives; provided, that during any
360-day period the aggregate of all payment blockage periods pursuant hereto
shall not exceed 179 days and there shall be a period of at least 181
consecutive days in each 360-day period when no payment blockage period pursuant
hereto is in effect.
(c) In the event that, notwithstanding the provisions of this
Section 9.02, the Company shall make any payment to the Trustee or the Holders
on account of any Obligations
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with respect to the Securities, after the happening of a default in payment of
the principal on Senior Indebtedness or an event of default in respect of the
payment of interest on Senior Indebtedness or after receipt by the Company and
the Trustee of written notice as provided in this Section 9.02 of an event of
default with respect to any Senior Indebtedness, then, unless and until such
default or event of default shall have been cured or waived or shall have ceased
to exist, such payment (subject to the provisions of Sections 9.06 and 9.07)
shall be held by the Trustee or Holders, as the case may be, in trust for the
benefit of, and shall be paid over and delivered to, the holders of Senior
Indebtedness (pro rata as to each of such holders on the basis of the respective
amounts of Senior Indebtedness held by them) or their representative or the
trustee under the indenture or other agreement (if any) pursuant to which Senior
Indebtedness may have been issued, as their respective interests may appear, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full in accordance with its
terms, after giving effect to any concurrent payment or distribution or
provision therefor to the holders of Senior Indebtedness. The Company shall give
prompt written notice to the Trustee of any default under any Senior
Indebtedness or under any agreement pursuant to which Senior Indebtedness may
have been issued.
SECTION 9.03. Securities Subordinated to Prior Payment of
All Senior Indebtedness on Dissolution,
Liquidation or Reorganization of Company.
Upon any distribution of assets of the Company upon any
dissolution, winding up, liquidation or reorganization of the Company (whether
in bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors or otherwise) tending towards liquidation of the
business and assets of the Company:
(a) the holders of all Senior Indebtedness shall first be
entitled to receive payment in full of all Obligations due thereon
(including without limitation interest accruing after the commencement
of any such proceeding at the rate specified in the respective Senior
Indebtedness) before the Holders of the Securities are entitled to
receive any payment on account of any Obligations with respect to the
Securities;
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(b) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to which the
Holders of the Securities or the Trustee on behalf of the Holders of the
Securities would be entitled except for the provisions of this Article
Nine, shall be paid by the liquidating trustee or agent or other person
making such payment or distribution directly to the holders of Senior
Indebtedness or their representative, or to the trustee under any
indenture under which Senior Indebtedness may have been issued, to the
extent necessary to make payment in full of all Senior Indebtedness
remaining unpaid, after giving effect to any concurrent payment or
distribution or provision therefor to the holders of such Senior
Indebtedness; and
(c) in the event that notwithstanding the foregoing
provisions of this Section 9.03, any payment or distribution
of assets of the Company of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or the Holders
of the Securities on account of any Obligations with respect to the
Securities before all Senior Indebtedness is paid in full, or effective
provision made for its payment, such payment or distribution (subject to
the provisions of Section 9.06 and 9.07) shall be received and held in
trust for and shall be paid over to the holders of the Senior
Indebtedness remaining unpaid or unprovided for or their representative,
or to the trustee under any indenture under which Senior Indebtedness
may have been issued, for application to the payment of such Senior
Indebtedness until all such Senior Indebtedness shall have been paid in
full, after giving effect to any concurrent payment or distribution or
provision therefor to the holders of such Senior Indebtedness.
The Company shall give prompt written notice to the Trustee of
any dissolution, winding up, liquidation or reorganization of the Company.
SECTION 9.04. Securityholders To Be Subrogated to
Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities shall be subrogated to the rights of the holders of
Senior Indebtedness to receive payments or distributions of assets of the
Company applicable to the Senior Indebtedness until all amounts owing on the
Securities shall be paid in full, and for the purpose of such
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subrogation no payments or distributions to the holders of the Senior
Indebtedness by or on behalf of the Company or by or on behalf of the Holders of
the Securities by virtue of this Article which otherwise would have been made to
the Holders of the Securities shall, as between the Company and the Holders of
the Securities, be deemed to be payment by the Company to or on account of the
Senior Indebtedness, it being understood that the provisions of this Article
Nine are and are intended solely for the purpose of defining the relative rights
of the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
SECTION 9.05. Obligation of the Company Unconditional.
Nothing contained in this Article Nine or elsewhere in this
Indenture or in any Security is intended to or shall impair, as between the
Company and the Holders of the Securities, the obligation of the Company, which
is absolute and unconditional, to pay to the Holders of the Securities the
principal and interest on the Securities as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall affect
the relative rights of the Holders of the Securities and creditors of the
Company other than the holders of the Senior Indebtedness, nor shall anything
herein or therein prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon Default under
this Indenture, subject to the rights, if any, under this Article Nine of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy. Upon any distribution of
assets of the Company referred to in this Article Nine, the Trustee, subject to
the provisions of Sections 6.01 and 6.02, and the Holders of the Securities
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which such dissolution, winding up, liquidation or
reorganization proceedings are pending, or a certificate of the liquidating
trustee or agent or other person making any distribution to the Trustee or to
the Holders of the Securities, for the purpose of ascertaining the persons
entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article Nine.
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SECTION 9.06. Trustee Entitled To Assume Payments
Not Prohibited in Absence of Notice.
The Trustee shall not at any time be charged with knowledge of
the existence of any facts which would prohibit the making of any payment to or
by the Trustee, unless it shall have received at its corporate trust department
written notice thereof from the Company or from one or more holders of Senior
Indebtedness or from any trustee thereof; and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Article Six, shall be
entitled to assume conclusively that no such facts exist. The Trustee shall be
entitled to rely on the delivery to it of a written notice by a person
representing himself to be a holder of Senior Indebtedness (or a trustee on
behalf of such holder) to establish that such notice has been given by a holder
of Senior Indebtedness or a trustee on behalf of any such holder or holders.
SECTION 9.07. Application by Trustee of Monies
Deposited with It.
Except as provided in Section 7.02, any deposit of monies by the
Company with the Trustee or any Paying Agent (whether or not in trust) for the
payment of the principal of interest on any Securities shall be subject to the
provisions of Sections 9.01, 9.02, 9.03 and 9.04 except that, if prior to the
third business day prior to the date on which by the terms of this Indenture any
such monies may become payable for any purpose (including, without limitation,
the payment of either the principal or the interest on any Security) the Trustee
or, in the case of any such deposit of monies with a Paying Agent, the Paying
Agent shall not have received with respect to such monies the notice provided
for in Section 9.06, then the Trustee or such Paying Agent, as the case may be,
shall have full power and authority to receive such monies and to apply the same
to the purpose for which they were received, and shall not be affected by any
notice to the contrary which may be received by it on or after such third
business day. In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any person as a holder
of Senior Indebtedness to participate in any payment or distribution pursuant to
this Article Nine, the Trustee may request such person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such person, the extent to which such person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such person under this Article Nine,
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and if such evidence is not furnished the Trustee may defer any payment to such
person pending judicial determination as to the right of such person to receive
such payment.
The Trustee, however, shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness but shall have only such obligations
to such holders as are expressly set forth in this Article Nine.
SECTION 9.08. Subordination Rights Not Impaired
by Acts or Omissions of Company or
Holders of Senior Indebtedness.
No right of any present or future holders of any Senior
Indebtedness to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may have or be
otherwise charged with.
SECTION 9.09. Securityholders Authorize Trustee To
Effectuate Subordination of Securities.
Each Holder of the Securities by his acceptance thereof
authorizes and expressly directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
provided in this Article Nine and appoints the Trustee his attorney-in-fact for
such purpose, including, in the event of any dissolution, winding up,
liquidation or reorganization of the Company (whether in bankruptcy, insolvency
or receivership proceedings or upon an assignment for the benefit of creditors
or otherwise) tending towards liquidation of the business and assets of the
Company, the immediate filing of a claim for the unpaid balance of its or his
Securities in the form required in said proceedings and the causing of said
claim to be approved. If the Trustee does not file a proper claim or proof of
debt in the form required in such proceeding prior to 30 days before the
expiration of the time to file such claims, then the holders of Senior
Indebtedness are hereby authorized to have the right to file and are hereby
authorized to file an appropriate claim for and on behalf of the Holders of said
Securities.
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SECTION 9.10. Right of Trustee To Hold Senior Indebtedness.
The Trustee shall be entitled to all of the rights set forth in
this Article Nine in respect of any Senior Indebtedness at any time held by it
to the same extent as any other holder of Senior Indebtedness, and nothing in
this Indenture shall be construed to deprive the Trustee of any of its rights as
such holder.
SECTION 9.11. Article Nine Not To Prevent Events of Default.
The failure to make a payment on account of principal or interest
by reason of any provision in this Article Nine shall not be construed as
preventing the occurrence of an Event of Default under Section 5.01.
SECTION 9.12. Ranking; Designation.
The Securities rank senior in right of payment to the 5 1/4%
Debentures and pari passu in right of payment to the 10 3/8% Notes and the 8
1/4% Notes. The Indebtedness evidenced by the Securities is hereby irrevocably
designated as "Senior Indebtedness" for purposes of the Indenture dated as of
February 1, 1993 between the Company and First Trust National Association, as
trustee, pursuant to which the 5 1/4% Debentures were issued.
ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.
SECTION 10.02. Notices.
Any notice or communication shall be sufficiently given if in
writing and delivered in person or mailed by certified or registered mail
(return receipt requested) addressed as follows:
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If to the Company:
Leucadia National Corporation
315 Park Avenue South
New York, New York 10010
Attention: Secretary
With a copy to:
Weil Gotshal & Manges
767 Fifth Avenue
New York, New York 10153
Attention: Stephen E. Jacobs, Esq.
If to the Trustee:
Attention: Corporate Trust Department
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be
mailed to him by first-class mail at his address as it appears on the
registration books of the Registrar and shall be sufficiently given to him if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or
any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it. If the
Company mails notices or communications to Securityholders it shall mail a copy
to the Trustee and each Agent at the same time. All notices or communications
shall be in writing.
SECTION 10.03. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b) with
other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Trustee, the Registrar and anyone else shall
have the protection of TIA ss. 312(c).
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SECTION 10.04. Certificate and Opinion as
to Conditions Precedent.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such person, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of each such
person, such covenant or condition has been complied with.
SECTION 10.06. When Treasury Securities Disregarded.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company or by any Affiliate shall be disregarded, except
that for the purpose of determining whether the Trustee shall be protected in
relying
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on any such direction, waiver or consent, only Securities which the Trustee
knows are so owned shall be so disregarded.
SECTION 10.07. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a meeting
of Securityholders. The Registrar or Paying Agent may make reasonable rules for
its functions.
SECTION 10.08. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday, or a day on which
banks and trust companies in The City of New York, New York or Boston,
Massachusetts are not required by law or executive order to be open. If a
payment date is a Legal Holiday at a place of payment, payment may be made at
the place on the next succeeding day that is not a Legal Holiday, without
additional interest.
SECTION 10.09. Governing Law.
The laws of the State of New York shall govern this Indenture and
the Securities without regard to principles of conflicts of laws.
SECTION 10.10. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan
or debt agreement may not be used to interpret this Indenture.
SECTION 10.11. No Recourse Against Others.
All liability described in paragraph 17 of the Securities of any
director, officer, employee or stockholder, as such, of the Company is waived
and released.
SECTION 10.12. Successors.
All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of the Trustee in this
Indenture shall bind its successor.
<PAGE>
<PAGE>
-59-
SECTION 10.13. Duplicate Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
instrument.
SECTION 10.14. Separability.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby, and a Holder shall have no claim therefor against any party
hereto.
<PAGE>
<PAGE>
-60-
SIGNATURES
LEUCADIA NATIONAL CORPORATION
By ______________________________________
Name:
Title:
(Seal)
Attest:
By___________________________
Name:
Title:
[ ]
By ______________________________________
Name:
Title:
(Seal)
<PAGE>
<PAGE>
EXHIBIT A
[Form of Security]
[ ]% SENIOR SUBORDINATED NOTE DUE OCTOBER [ ], 2006
No. $
LEUCADIA NATIONAL CORPORATION
(a New York corporation)
promises to pay to ____________________
or registered assigns
the principal sum of Dollars on October [ ], 2006.
Interest Payment Dates: April [ ] and October [ ]
Record Dates: [ ] and [ ]
Dated:
LEUCADIA NATIONAL CORPORATION
_________________________________________
Chairman of the Board
[Seal]
Attest:
__________________________________
Secretary
<PAGE>
<PAGE>
-2-
Certificate of Authentication
This Note is one of the Securities
referred to in the within-mentioned
Indenture.
[ ], TRUSTEE
By__________________________________
Authorized Signatory
[Seal]
<PAGE>
<PAGE>
-3-
LEUCADIA NATIONAL CORPORATION
[ ]% Senior Subordinated Note due October [ ], 2006
1. Interest.
Leucadia National Corporation (the "Company") promises to pay
interest on the principal amount of this Note at the rate per annum shown above.
The Company will pay interest semiannually on April [ ] and October [ ] of each
year commencing April [ ], 1997. Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from October [ ], 1996. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
2. Method of Payment.
The Company will pay interest on the Notes (except defaulted
interest) to the persons who are registered holders of Notes at the close of
business on the [ ] or [ ] next preceding the interest payment date even though
Notes are cancelled after the record date and on or before the interest payment
date. Holders must surrender Notes to a Paying Agent to collect principal
payments. The Company will pay principal and interest in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may pay interest by check payable in such
money. It may mail an interest check to a Holder's registered address.
3. Paying Agent, Registrar.
Initially, [ ] will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its Subsidiaries (as defined in the
Indenture) may act in any such capacity.
4. Indenture.
The Company issued the Notes under an Indenture dated as of
October [ ], 1996 (the "Indenture") between the Company and the Trustee. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by
<PAGE>
<PAGE>
-4-
reference to the Trust Indenture Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb)
as in effect on the date of the Indenture. The Notes are subject to all such
terms, and Noteholders are referred to the Indenture and such Act for a
statement of such terms. The Notes are general unsecured subordinated
obligations of the Company limited to $135,000,000 aggregate principal amount,
except as otherwise provided in the Indenture.
5. Subordination.
The Notes are subordinated to Senior Indebtedness, which is
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Notes may be paid. Each Noteholder by
accepting a Note agrees to such subordination and authorizes the Trustee to give
it effect.
6. Maintenance of Consolidated Tangible Net Worth.
If, on the last day of each of any two consecutive fiscal
quarters of the Company (the last day of the second such fiscal quarter being
referred to herein as the "Deficiency Date") the Company's Consolidated Tangible
Net Worth is less than the Minimum Tangible Net Worth, then the Company is
required, no later than 65 days after a Deficiency Date (110 days if a
Deficiency Date is the last day of the Company's fiscal year), to make an offer
to purchase (an "Offer") 10% of the aggregate principal amount of Notes
originally issued (the "Offer Amount") at a purchase price of 100% of the
principal amount of such Notes, plus accrued interest to the date of purchase.
If the aggregate principal amount of Notes tendered to the Company exceeds the
Offer Amount, the Company is required to purchase the Notes tendered to it pro
rata among such Notes tendered (with such adjustments as may be appropriate so
that only Notes in denominations of $1,000 and integral multiples thereof shall
be purchased). The Company may reduce the principal amount of Notes to be
purchased pursuant to the Offer by subtracting 100% of the principal amount of
Notes acquired by the Company subsequent to the Deficiency Date through purchase
(otherwise than pursuant to this provision, pursuant to a Change of Control
offer or pursuant to a Certain Payment or Investment offer) or exchange, and
surrendered for cancellation.
<PAGE>
<PAGE>
-5-
7. Change of Control.
In the event of a Change of Control of the Company, each Holder
shall have the right, at such Holder's option, to require the Company to buy all
or any portion of such Holder's Notes, at 101% of the principal amount thereof,
plus accrued interest to the date of purchase.
8. Certain Payments or Investments.
In the event of a Certain Payment or Investment by the Company,
each Holder shall have the right, at such Holder's option, to require the
Company to buy all or any portion of such Holder's Notes, at 101% of the
principal amount thereof, plus accrued interest to the date of purchase.
9. Restrictive Covenants.
The Indenture imposes certain limitations on, among other things,
the ability of the Company to merge or consolidate with any other Person or
sell, lease or otherwise transfer all or substantially all of its properties or
assets, the ability of the Company to pay dividends and to make certain other
distributions and payments and the ability of the Company and its Subsidiaries
to make certain Investments or redeem, retire or repurchase or acquire for value
shares of Capital Stock of the Company, the ability of the Company and the
Subsidiaries to incur additional Indebtedness and the ability of the Company and
the Subsidiaries to enter into certain transactions with Affiliates, all subject
to certain limitations described in the Indenture.
10. Denominations, Transfer, Exchange.
The Notes are in registered form without coupons in denominations
of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Notes
in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to
pay any taxes and fees required by law or permitted by the Indenture.
11. Persons Deemed Owners.
The registered Holder of a Note may be treated as the owner of it
for all purposes and neither the Company, the Trustee nor any Agent shall be
affected by notice to the contrary.
<PAGE>
<PAGE>
-6-
12. Unclaimed Money.
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent will pay the money back to
the Company at its request. After that, Noteholders entitled to the money must
look to the Company for payment unless an abandoned property law designates
another person.
13. Amendment, Supplement, Waiver.
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in principal amount of the Notes, and any past default or noncompliance with any
provision may be waived with the consent of the Holders of a majority in
principal amount of the Notes. Without the consent of any Noteholder, the
Company may amend or supplement the Indenture or the Notes to cure any
ambiguity, omission, defect or inconsistency or to provide for uncertificated
Notes in addition to certificated Notes or to make any change that does not
adversely affect the rights of any Noteholder.
14. Successor Corporation.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor corporation will
be released from those obligations.
15. Defaults and Remedies.
The terms of the Notes include the Events of Default as set forth
in Section 5.01 of the Indenture. Subject to certain limitations in the
Indenture, if an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable immediately, except that in the case
of an Event of Default arising from certain events of bankruptcy, insolvency or
reorganization relating to the Company, all outstanding Notes shall become due
and payable immediately without further action or notice. Holders may not
enforce the Indenture or the Notes except as provided in the Indenture. The
Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Notes. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Notes may direct the Trustee in its
<PAGE>
<PAGE>
-7-
exercise of any trust or power. The Company must furnish quarterly compliance
certificates to the Trustee.
16. Trustee Dealings with Company.
[ ], the Trustee under the Indenture, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its affiliates, and may otherwise deal with the
Company or its affiliates, as if it were not the Trustee.
17. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Notes or the Indenture or for any claim based on, in respect of or by reason
of, such obligations or their creation. Each Noteholder by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Notes.
18. Authentication.
This Note shall not be valid until the Trustee or an
authenticating agent signs the certificate of authentication on the other side
of this Note.
19. Abbreviations.
Customary abbreviations may be used in the name of a Noteholder
or an assignee, such as: TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors
Act).
The Company will furnish to any Noteholder upon written request
and without charge a copy of the Indenture. Requests may be made to: Secretary,
Leucadia National Corporation, 315 Park Avenue South, New York, New York 10010.
<PAGE>
<PAGE>
-8-
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
___________________________________________
: :
___________________________________________
(Insert assignee's soc. sec. or tax ID no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
________________________________________________________________________________
________________________________________________________________________________
Your Signature:
____________________________________________________________
(Sign exactly as your name appears on the
other side of this Note)
Date: _______________________
<PAGE>
<PAGE>
-9-
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 3.10, Section 3.11 or Section 3.15 of the Indenture, check
the appropriate box:
Section 3.10 [ ]
Section 3.11 [ ]
Section 3.15 [ ]
If you want to have only part of this Note purchased by the
Company pursuant to Section 3.10, Section 3.11 or Section 3.15 of the Indenture,
state the amount (in integral multiples of $1,000):
$
Date: _____________________ Signature:__________________________
(Sign exactly as your
name appears on the
other side of this
Note)
Signature Guarantee: ___________________________________________________________
<PAGE>
<PAGE>
October 1, 1996
Leucadia National Corporation
315 Park Avenue South
New York, New York 10010
Re: Leucadia National Corporation -
Registration Statement on Form S-3
(No. 333-12071)
-----------------------------------
Gentlemen:
We have acted as counsel to Leucadia National Corporation (the
"Company") in connection with the preparation and filing with the Securities and
Exchange Commission of the Company's Registration Statement on Form S-3, File
No. 333-12071 (as amended, the "Registration Statement") under the Securities
Act of 1933, as amended, relating to $135,000,000 principal amount of the
Company's Senior Subordinated Notes due 2006 (the "Securities").
In so acting, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of the Registration Statement, the
form of Underwriting Agreement (the "Underwriting Agreement") between the
Company and Jefferies & Company, Inc. and CS First Boston Corporation, the form
of Indenture (the "Indenture") between the Company and Fleet National Bank, as
Trustee, pursuant to which the Securities will be issued, and such corporate
records, agreements, documents and other instruments, and such certificates or
comparable documents of public officials and of officers and representatives of
the Company, and have made such inquiries of such officers and representatives
as we have deemed relevant and necessary as a basis for the opinions hereinafter
set forth.
In such examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, the
conformity to original documents of documents
<PAGE>
<PAGE>
Leucadia National Corporation
October 1, 1996
Page 2
submitted to us as certified or photostatic copies and the authenticity of the
originals of such latter documents. As to all questions of fact material to this
opinion that have not been independently established, we have relied upon
certificates or comparable documents of officers and representatives of the
Company.
Based on the foregoing, and subject to the qualifications stated
herein, we are of the opinion that the Securities are duly authorized and, when
duly executed on behalf of the Company, authenticated by the Trustee under the
Indenture and issued and sold in accordance with the terms of the Underwriting
Agreement and as described in the Registration Statement, will be validly issued
and will constitute legal and binding obligations of the Company in accordance
with their terms and the terms of the Indenture, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and subject, as
to enforceability, to general principles of equity, including principles of
commercial reasonableness, good faith and fair-dealing (regardless of whether
enforcement is sought in a proceeding at law or in equity).
The opinions expressed herein are limited to the laws of the
State of New York and the federal laws of the United States, and we express no
opinion as to the effect on the matters covered by this opinion of the laws of
any other jurisdiction.
The opinions expressed herein are rendered solely for your
benefit in connection with the transactions described herein. Those opinions may
not be used or relied upon by any other person, nor may this letter or any
copies thereof be furnished to a third party, filed with a governmental agency,
quoted, cited or otherwise referred to without our prior written consent. We
hereby consent to the use of this letter as an exhibit to the Registration
Statement. We further consent to any and all references to our firm in the
Prospectus which is a part of said Registration Statement.
Very truly yours,
/s/ WEIL, GOTSHAL & MANGES LLP
<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------
FORM T-1
----------
STATEMENT OF ELIGIBILITY AND QUALIFICATION 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)
FLEET NATIONAL BANK
---------------------------------------------------------
(Exact name of trustee as specified in its charter)
<TABLE>
<S> <C>
Not applicable 04-317415
- ------------------------------- -----------------------------
(State of incorporation (I.R.S. Employer
if not a national bank) Identification No.)
One Monarch Place, Springfield, MA 01102
- ---------------------------------------- -----------------------------
(Address of principal executive offices) (Zip Code)
</TABLE>
Pat Beaudry, 777 Main Street, Hartford, CT 06115 (203) 728-2065
--------------------------------------------------------------
(Name, address and telephone number of agent for service)
LEUCADIA NATIONAL CORPORATION
---------------------------------------------------
(Exact name of obligor as specified in its charter)
<TABLE>
<S> <C>
New York 13-2615557
- ------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
315 Park Avenue South
New York, New York 10010
- ---------------------------------------- -----------------------------
(Address of principal executive offices) (Zip Code)
</TABLE>
Senior Subordinated Notes due 2006
------------------------------------------------------------------
(Title of the indenture securities)
<PAGE>
<PAGE>
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject,
The Comptroller of the Currency,
Washington, D.C.
Federal Reserve Bank of Boston
Boston, Massachusetts
Federal Deposit Insurance Corporation
Washington, D.C.
(b) Whether it is authorized to exercise
corporate trust powers:
The trustee is so authorized.
Item 2. Affiliations with obligor and underwriter. If the obligor or
any underwriter for the obligor is an affiliate of the trustee,
describe each such affiliation.
None with respect to the trustee.
Item 16. List of exhibits.
List below all exhibits filed as a part of this statement of
eligibility and qualification.
(1) A copy of the Articles of Association of the trustee as
now in effect.
(2) A copy of the Certificate of Authority of the trustee
to do business.
(3) A copy of the Certification of Fiduciary Powers of the
trustee.
(4) A copy of the By-Laws of the trustee as now in effect.
(5) Consent of the trustee required by Section 321(b)
of the Act.
(6) A copy of the latest Consolidated Reports of Condition
and Income of the trustee published pursuant to law or
the requirements of its supervising or examining authority.
NOTES
In as much as this Form T-1 is filed prior to the ascertainment by the trustee
of all facts on which to base answers to Item 2, the answers to said Items are
based upon imcomplete information. Said Items may, however, be considered
correct unless amended by an amendment to this Form T-1.
<PAGE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939,
the trustee, Fleet National Bank, a national banking association organized and
existing under the laws of the United States, has duly caused this statement of
of eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Hartford, and State of
Connecticut, on the 25th day of September, 1996.
FLEET NATIONAL BANK,
AS TRUSTEE
By: /s/
-------------------------
Robert L. Reynolds
Its: Vice President
<PAGE>
<PAGE>
EXHIBIT 1
ARTICLES OF ASSOCIATION
OF
FLEET NATIONAL BANK
FIRST. The title of this Association, which shall carry on the business of
banking under the laws of the United States, shall be "Fleet National Bank."
SECOND. The main office of the Association shall be in Springfield, Hampden
County Commonwealth of Massachusetts. The general business of the Association
shall be conducted at its main office and its branches.
THIRD. The board of directors of this Association shall consist of not less
than five (5) nor more than twenty-five (25) shareholders, the exact number of
directors within such minimum and maximum limits to be fixed and determined
from time to time by resolution of a majority of the full board of directors or
by resolution of the shareholders at any annual or special meeting thereof.
Unless otherwise provided by the laws of the United States, any vacancy in the
board of directors for any reason, including an increase in the number thereof,
may be filled by action of the board of directors.
FOURTH. The annual meeting of the shareholders for the election of directors
and the transaction of whatever other business may be brought before said
meeting shall be held at the main office or such other place as the board of
directors may designate, on the day of each year specified therefore in the
bylaws, but if no election is held on that day, it may be held on any
subsequent day according to the provisions of law; and all elections shall be
held according to such lawful regulations as may be prescribed by the board of
directors.
FIFTH. The authorized amount of capital stock of this Association shall be
eight million five hundred thousand (8,500,000) shares of which three million
five hundred thousand (3,500,000) shares shall be common stock with a
par value of six and 25/100 dollars ($6.25) each, and of which five million
(5,000,000) shares without par value shall be preferred stock. The capital
stock may be increased or decreased from time to time, in accordance with
the provisions of the laws of the United States.
No holder of shares of the capital stock of any class of the Association shall
have any pre-emptive or preferential right of subscription to any shares of any
class of stock of the Association, whether now or hereafter authorized, or to
any obligations convertible into stock of the Association, issued or sold, nor
any right of subscription to any thereof other than such, if any, as the board
of directors, in its discretion, may from time to time determine and at such
price as the board of directors may from time to time fix.
<PAGE>
<PAGE>
The board of directors of the Association is authorized, subject to limitations
prescribed by law and the provisions of this Article, to provide for the
issuance from time to time in one or more series of any number of the preferred
shares, and to establish the number of shares be included in each series, and
to fix the designation, relative rights, preferences, qualifications and
limitations of the shares of each such series. The authority of the board of
directors with respect to each series shall include, but not be limited to,
determination of the following:
a. The number of shares constituting that series and the distinctive
designation of that series;
b. The dividend rate on the shares of that series, whether dividends shall be
cumulative, and, if so, from which date or dates, and whether they shall be
payable in preference to, or in another relation to, the dividends payable
to any other class or classes or series of stock;
c. Whether that series shall have voting rights, in addition to the voting
rights provided by law, and, if so, the terms of such voting rights;
d. Whether that series shall have conversion or exchange privileges, and,
if so, the terms and conditions of such conversion or exchange, including
provision for the adjustment of the conversion or exchange rate in such
events as the board of directors shall determine;
e. Whether or not the shares of that series shall be redeemable, and, if so,
the terms and conditions of such redemption, including the manner of
selecting shares for redemption if less than all shares are to be redeemed,
the date or dates upon or after which they shall be redeemable, and the
amount per share payable in case of redemption, which amount may vary under
different conditions and at different redemption dates;
f. Whether that series shall be entitled to the benefit of a sinking fund to
be applied to the purchase or redemption of shares of that series, and, if
so, the terms and amounts of such sinking fund;
g. The right of the shares of that series to the benefit of conditions and
restrictions upon the creation of indebtedness of the Association or any
subsidiary, upon the issue of any additional stock (including additional
shares of such series or of any other series) and upon the payment of
dividends or the making of other distributions on, and the purchase,
redemption or other acquisition by the Association or any subsidiary of
any outstanding stock of the Association;
h. The right of the shares of that series in the event of voluntary or
involuntary liquidation, dissolution or winding up of the Association and
whether such rights shall be in preference to, or in another relation to,
the comparable rights of any other class or classes or series of stock; and
i. Any other relative, participating, optional or other special rights,
qualifications, limitations or restrictions of that series.
Shares of any series of preferred stock which have been redeemed (whether
through the operation of a sinking fund or otherwise) or which, if convertible
or exchangeable, have been converted into or exchanged for shares of stock of
any other class or classes shall have the status of authorized and unissued
shares of preferred stock of the same series and may be reissued as a part of
the series of which they were originally a part or may be reclassified and
reissued as part of a new series of preferred stock to be created by resolution
or resolutions of the board of directors or as part of any other series or
preferred stock, all subject to the conditions and the restrictions adopted by
the board of directors providing for the issue of any series of preferred
stock and by the provisions of any applicable law.
Subject to the provisions of any applicable law, or except as otherwise
provided by the resolution or resolutions providing for the issue of any series
of preferred stock, the holders of outstanding shares of common stock shall
exclusively possess voting power for the election of directors and for all
purposes, each holder of record of shares of common stock being entitled to one
vote for each share of common stock standing in his name on the books of the
Association.
Except as otherwise provided by the resolution or resolutions providing for the
issue of any series of preferred stock, after payment shall have been made to
the holders of preferred stock of the full amount of dividends to which they
shall be entitled pursuant to the resolution or resolutions providing for the
issue of any other series of preferred stock, the holders of common stock shall
be entitled, to the exclusion of the holders of preferred stock of any and all
series, to receive such dividends as from time to time may be declared by the
board of directors.
Except as otherwise provided by the resolution or resolutions for the issue
of any series of preferred stock, in the event of any liquidation, dissolution
or winding up of the Association, whether voluntary or involuntary, after
payment shall have been made to the holders of preferred stock of the full
amount to which they shall be entitled pursuant to the resolution or
resolutions providing for the issue of any series of preferred stock the
holders of common stock shall be entitled, to the exclusion of the holders of
preferred stock of any and all series, to share, ratable according to the
number of shares of common stock held by them, in all remaining assets of the
Association available for distribution to its shareholders.
The number of authorized shares of any class may be increased or decreased by
the affirmative vote of the holders of a majority of the stock of the
Association entitled to vote.
<PAGE>
<PAGE>
SIXTH. The board of directors shall appoint one of its members president of
this Association, who shall be chairman of the board, unless the board appoints
another director to be the chairman. The board of directors shall have the
power to appoint one or more vice presidents; and to appoint a secretary and
such other officers and employees as may be required to transact the business
of this Association.
The board of directors shall have the power to define the duties of the
officers and employees of the Association; to fix the salaries to be paid to
them; to dismiss them; to require bonds from them and to fix the penalty
thereof; to regulate the manner in which any increase of the capital of the
Association shall be made; to manage and administer the business and affairs of
the Association; to make all bylaws that it may be lawful for them to make; and
generally to do and perform all acts that it may be legal for a board of
directors to do and perform.
SEVENTH. The board of directors shall have the power to change the location of
the main office to any other place within the limits of the City of Hartford,
Connecticut, without the approval of the shareholders but subject to the
approval of the Comptroller of the Currency; and shall have the power to
establish or change the location of any branch or branches of the Association
to any other location, without the approval of the shareholders but subject to
the approval of the Comptroller of the Currency.
EIGHTH. The corporate existence of this Association shall continue until
terminated in accordance with the laws of the United States.
NINTH. The board of directors of this Association, or any three or more
shareholders owning, in the aggregate, not less than ten percent (10%) of the
stock of this Association, may call a special meeting of shareholders at any
time. Unless otherwise provided by the laws of the United States, a notice of
the time, place and purpose of every annual and special meeting of the
shareholders shall be given by first class mail, postage prepaid, mailed at
least ten (10) days prior to the date of such meeting to each shareholder of
record at his address as shown upon the books of this Association.
TENTH. (a) Right to Indemnification. Each person who was or is made a party
or is threatened to be made a party to any threatened, pending or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative (hereinafter a "proceeding"), by reason of the fact that he or
she is or was a director, officer or employee of the Association or is or was
serving at the request of the Association as a director, officer, employee or
agent of another corporation or of a partnership, joint venture, limited
liability company, trust, or other enterprise, including service with respect
to an employee benefit plan, shall be indemnified and held harmless by the
Association to the fullest extent authorized by the law of the state in which
the Association's ultimate parent company is incorporated, except as provided
in subsection (b). The aforesaid indemnity shall protect the indemnified
person against all expense, liability and loss (including attorney's fees,
judgements, fines ERISA excise taxes or penalties, and amounts paid in
settlement) reasonably incurred by such person in connection with such a
proceeding. Such indemnification shall continue as to a person who has ceased
to be a director, officer or employee and shall inure to the benefit of his or
her heirs, executors, and administrators, but shall only cover such person's
period of service with the Association. The Association may, by action of its
Board of Directors, grant rights to indemnification to agents of the
Association and to any director, officer, employee or agent of any of its
subsidiaries with the same scope and effect as the foregoing indemnification
of directors and officers.
(b) Restrictions on Indemnification. Notwithstanding the foregoing, (i) no
person shall be indemnified hereunder by the Association against expenses,
penalties, or other payments incurred in an administrative proceeding or action
instituted by a federal bank regulatory agency which proceeding or action
results in a final order assessing civil money penalties against that person,
requiring affirmative action by that person in the form of payments to the
Association, or removing or prohibiting that person from service with the
Association, and any advancement of expenses to that person in that proceeding
must be repaid; and (ii) no person shall be indemnified hereunder by the
Association and no advancement of expenses shall be made to any person
hereunder to the extent such indemnification or advancement of expenses would
violate or conflict with any applicable federal statute now or hereafter in
force or any applicable final regulation or interpretation now or hereafter
adopted by the Office of the Comptroller of the Currency ("OCC") or the Federal
Deposit Insurance Corporation ("FDIC"). The Association shall comply with any
requirements imposed on it by any such statue or regulation in connection with
any indemnification or advancement of expenses hereunder by the Association.
With respect to proceedings to enforce a claimant's rights to indemnification,
the Association shall indemnify any such claimant in connection with such a
proceeding only as provided in subsection (d) hereof.
<PAGE>
(c) Advancement of Expenses. The conditional right to indemnification
conferred in this section shall be a contract right and shall include the
right to be paid by the Association the reasonable expenses (including
attorney's fees) incurred in defending a proceeding in advance of its final
disposition (an "advancement of expenses"); provided, however, that an
advancement of expenses shall be made only upon (i) delivery to the Association
of a binding written undertaking by or on behalf of the person receiving the
advancement to repay all amounts so advanced if it is ultimately determined
that such person is not entitled to be indemnified in such proceeding,
including if such proceeding results in a final order assessing civil money
penalties against that person, requiring affirmative action by that person
in the form of payments to the Association, or removing or prohibiting that
person from service with the Association, and (ii) compliance with any other
actions or determinations required by applicable law, regulation or OCC or FDIC
interpretation to be taken or made by the Board of Directors of the Association
or other persons prior to an advancement of expenses. The Association shall
cease advancing expenses at any time its Board of Directors believes that any
of the prerequisites for advancement of expenses are no longer being met.
(d) Right of Claimant to Bring Suit. If a claim under subsection (a) of the
section is not paid in full by the Association within thirty (30) days after
written claim has been received by the Association, the claimant may at any time
thereafter bring suit against the Association to recover the unpaid amount
of the claim. If successful in whole or in part in any such suit, or in a
suit brought by the Association to recover an advancement of expenses pursuant
to the terms of an undertaking, the claimant shall be entitled to be paid also
the expense of prosecuting or defending such claim. It shall be a defense to
any such action brought by the claimant to enforce a right to indemnification
hereunder (other than an action brought to enforce a claim for an advancement
of expenses where the required undertaking, if any, has been tendered to the
Association) that the claimant has not met any applicable standard for
indemnification under the law of the state in which the Association's ultimate
parent company is incorporated. In any suit brought by the Association to
recover an advancement of expenses pursuant to the terms of an undertaking, the
Association shall be entitled to recover such expenses upon a final
adjudication that the claimant has not met any applicable standard for
indemnification standard for indemnification under the law of the state in
which the Association's ultimate parent company is incorporated.
(e) Non-Exclusivity of Rights. The rights to indemnification and the
advancement of expenses conferred in this section shall not be exclusive of any
other right which any person may have or hereafter acquired under any statute,
agreement, vote of stockholders or disinterested directors or otherwise.
(f) Insurance. The Association may purchase, maintain, and make payment or
reimbursement for reasonable premiums on, insurance to protect itself and any
director, officer, employee or agent of the Association or another corporation,
partnership, joint venture, trust or other enterprise against any expense,
liability or loss, whether or not the Association would have the power to
indemnify such person against such expense, liability or loss under the law of
the state in which the Association's ultimate parent company is incorporated;
provided however, that such insurance shall explicitly exclude insurance
coverage for a final order of a federal bank regulatory agency assessing civil
money penalties against an Association director, officer, employee or agent.
ELEVENTH. These articles of association may be amended at any regular or
special meeting of the shareholders by the affirmative vote of the holders of a
majority of the stock of this Association, unless the vote of the holders of
greater amount of stock is required by law, and in that case by the vote of the
holders of such greater amount. The notice of any shareholders' meeting at
which an amendment to the articles of association of this Association is to be
considered shall be given as hereinabove set forth.
I hereby certify that the articles of association of this Association, in their
entirety, are listed above in items first through eleventh.
Secretary/Assistant Secretary
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Dated at , as of .
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Revision of February 15, 1996
<PAGE>
<PAGE>
EXHIBIT 2
[LOGO]
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COMPTROLLER OF THE CURRENCY
ADMINISTRATOR OF NATIONAL BANKS
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Washington, D.C. 20219
CERTIFICATE
I, Eugene A. Ludwig, Comptroller of the Currency, do hereby certify
that:
(1) The Comptroller of the Currency, pursuant to Revised Statutes
324, et seq., as amended, 12 U.S.C. 1, et seq., as amended, has possession,
custody and control of all records pertaining to the chartering, regulation and
supervision of all National Banking Associations.
(2) "Fleet National Bank", Springfield, Massachusetts
(Charter No. 1338), is a National Banking Association formed under the
laws of the United States and is authorized thereunder to transact the
business of banking on the date of this Certificate.
IN TESTIMONY WHEREOF, I have hereunto
subscribed my name and caused my seal of
office to be affixed to these presents at
the Treasury Department, in the City of
Washington and District of Columbia, this
14th day of August, 1996.
/s/ EUGENE A. LUDWIG
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Comptroller of the Currency
<PAGE>
<PAGE>
EXHIBIT 2
[LOGO]
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COMPTROLLER OF THE CURRENCY
ADMINISTRATOR OF NATIONAL BANKS
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Washington, D.C. 20219
Certification of Fiduciary Powers
I, Eugene A. Ludwig, Comptroller of the Currency, do hereby certify
the records in this Office evidence "Fleet National Bank",
Springfield, Massachusetts, (Charter No. 1338), was granted, under the hand
and seal of the Comptroller, the right to act in all fiduciary capacities
authorized under the provisions of The Act of Congress approved
September 28, 1962, 76 Stat. 668, 12 U.S.C. 92a. I further certify the
authority so granted remains in full force and effect.
IN TESTIMONY WHEREOF, I have hereunto
subscribed my name and caused my seal of
Office of the Comptroller of the Currency
to be affixed to these presents at the
Treasury Department, in the City of
Washington and District of Columbia, this
4th day of April, 1996.
/s/ EUGENE A. LUDWIG
----------------------------------
Comptroller of the Currency
<PAGE>
<PAGE>
EXHIBIT 4
AMENDED AND RESTATED BY-LAWS OF
FLEET NATIONAL BANK
ARTICLE I
MEETINGS OF SHAREHOLDERS
Section 1. Annual Meeting. The regular annual meeting of the shareholders for
the election of Directors and the transaction of any other business that may
properly come before the meeting shall be held at the Main Office of the
Association, or such other place as the Board of Directors may designate, on
the fourth Thursday of April in each year at 1:15 o'clock in the afternoon
unless some other hour of such day is fixed by the Board of Directors.
If, from any cause, an election of Directors is not made on such day, the Board
of Directors shall order the election to be held on some subsequent day, of
which special notice shall be given in accordance with the provisions of law,
and of these bylaws.
Section 2. Special Meetings. Special meetings of the shareholders may be called
at any time by the Board of Directors, the President, or any shareholders
owning not less than twenty-five percent (25%) of the stock of the Association.
Section 3. Notice of Meetings of Shareholders. Except as otherwise provided
by law, notice of the time and place of annual or special meetings of the
shareholders shall be mailed, postage prepaid, at least ten (10) days before
the date of the meeting to each shareholder of record entitled to vote thereat
at his address as shown upon the books of the Association; but any failure to
mail such notice to any shareholder or any irregularity therein, shall not
affect the validity of such meeting or of any of the proceedings thereat.
Notice of a special meeting shall also state the purpose of the meeting.
Section 4. Quorum; Adjourned Meetings. Unless otherwise provided by law, a
quorum for the transaction of business at every meeting of the shareholders
shall consist of not less than two-fifths (2/5) of the outstanding capital
stock represented in person or by proxy; less than such quorum may adjourn the
meeting to a future time. No notice need be given of an adjourned annual or
special meeting of the shareholders if the adjournment be to a definite place
and time.
Section 5. Votes and Proxies. At every meeting of the shareholders, each
share of the capital stock shall be entitled to one vote except as otherwise
provided by law. A majority of the votes cast shall decide every question
or matter submitted to the shareholder at any meeting, unless otherwise
provided by law or by the Articles of Association or these By-laws. Share-
holders may vote by proxies duly authorized in writing and filed with the
Cashier, but no officer, clerk, teller or bookeeper of the Association may act
as a proxy.
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<PAGE>
Section 6. Nominations to Board of Directors. At any meeting of shareholders
held for the election of Directors, nominations for election to the Board of
Directors may be made, subject to the provisions of this section, by any share-
holder of record of any outstanding class of stock of the Association entitled
to vote for the election of Directors. No person other than those whose names
are stated as proposed nominees in the proxy statement accompanying the notice
of the meeting may be nominated as such meeting unless a shareholder shall have
given to the President of the Association and to the Comptroller of the
Currency, Washington, DC written notice of intention to nominate such other
person mailed by certified mail or delivered not less than fourteen (14) days
nor more than fifty (50) days prior to the meeting of shareholders at which
such nomination is to be made; provided, however, that if less than twenty-one
(21) days' notice of such meeting is given to shareholders, such notice of
intention to nominate shall be mailed by certified mail or delivered to said
President and said Comptroller on or before the seventh day following the day
on which the notice of such meeting was mailed. Such notice of intention to
nominate shall contain the following information to the extent known to the
notifying shareholder: (a) the name and address of each proposed nominee; (b)
the principal occupation of each proposed nominee; (c) the total number of
shares of capital stock of the Association that will be voted for each proposed
nominee; (d) the name and residence address of the notifying shareholder; and
(e) the number of shares of capital stock of the Association owned by the
notifying shareholder. In the event such notice is given, the proposed nominee
may be nominated either by the shareholder giving such notice or by any other
shareholder present at the meeting at which such nomination is to be made.
Such notice may contain the names of more than one proposed nominee, and if
more than one is named, any one or more of those named may be nominated.
Section 7. Action Taken Without a Shareholder Meeting. Any action requiring
shareholder approval or consent may be taken without a meeting and without
notice of such meeting by written consent of the shareholders.
ARTICLE II
DIRECTORS
Section 1. Number. The Board of Directors shall consist of such number of
shareholders, not less than five (5) nor more than twenty-five (25), as from
time to time shall be determined by a majority of the votes to which all of its
shareholders are at the time entitled, or by the Board of Directors as
hereinafter provided.
Section 2. Mandatory Retirement for Directors. No person shall be elected a
director who has attained the age of 68 and no person shall continue to serve
as a director after the date of the first meeting of the stockholders of the
Association held on or after the date on which such person attains the age of
68; provided, however, that any director serving on the Board as of December
15, 1995 who has attanined the age of 65 on or prior to such date shall be
permitted to continue to serve as a director until the date of the first
meeting of the stockholders of the Association held on or after the date on
which such person attains the age of 70.
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<PAGE>
<PAGE>
Section 3. General Powers. The Board of Directors shall exercise all the
coporate powers of the Association, except as expressly limited by law, and
shall have the control, management, direction and dispositon of all its
property and affairs.
Section 4. Annual Meeting. Immediately following a meeting of shareholders
held for the election of Directors, the Cashier shall notify the directors-
elect who may be present of their election and they shall then hold a meeting
at the Main Office of the Association, or such other place as the Board of
Directors may designate, for the purpose of taking their oaths, organizing the
new Board, electing officers and transacting any other business that may come
before such meeting.
Section 5. Regular Meeting. Regular meetings of the Board of Directors shall
be held without notice at the Main Office of the Association, or such other
place as the Board of Directors may designate, at such dates and times as the
Board shall determine. If the day designated for a regular meeting falls on a
legal holiday, the meeting shall be held on the next business day.
Section 6. Special Meetings. A special meeting of the Board of Directors may
be called at anytime upon the written request of the Chairman of the Board, the
President, or of two Directors, stating the purpose of the meeting. Notice of
the time and place shall be given not later than the day before the date of the
meeting, by mailing a notice to each Director at his last known address, by
delivering such notice to him personally, or by telephoning.
Section 7. Quorum; Votes. A majority of the Board of Directors at the time
holding office shall constitute a quorum for the transaction of all business,
except when otherwise provided by law, but less than a quorum may adjourn
a meeting from time to time, and the meeting may be held, as adjourned, without
further notice. If a quorum is present when a vote is taken, the affirmative
vote of a majority of Directors present is the act of the Board of Directors.
Section 8. Action by Directors Without a Meeting. Any action requiring
Director approval or consent may be taken without a meeting and without notice
of such meeting by written consent of all the Directors.
Section 9. Telephonic Participation in Directors' Meetings. A Director or
member of a Committee of the Board of Directors may participate in a meeting of
the Board or of such Committee may participate in a meeting of the Board or of
such Committee by means of a conference telephone or similar communications
equipment enabling all Directors participating in the meeting to hear one
another, and participation in such a meeting shall constitute presence in person
at such a meeting.
Section 10. Vacancies. Vacancies in the Board of Directors may be filled by
the remaining members of the Board at any regular or special meeting of the
Board.
Section 11. Interim Appointments. The Board of Directors shall, if the share-
holders at any meeting for the election of Directors have determined a number
of Directors less than twenty-five (25), have the power, by affirmative vote of
the majority of all the Directors, to increase such number of Directors to not
more than twenty-five (25) and to elect Directors to fill the resulting
vacancies and to serve until the next annual meeting of shareholders or the
next election of Directors; provided, however, that the number of Directors
shall not be so increased by more than two (2) if the number last determined
by shareholders was fifteen (15) or less, or increased by more than four (4) if
the number last determined by shareholders was sixteen (16) or more.
Section 12. Fees. The Board of Directors shall fix the amount and direct the
payment of fees which shall be paid to each Director for attendance at any
meeting of the Board of Directors or of any Committees of the Board.
ARTICLE III
COMMITTEES OF THE BOARD
Section 1. Executive Committee. The Board of Directors shall appoint from its
members an Executive Committee which shall consist of such number of persons as
the Board of Directors shall determine; the Chairman of the Board and the
President shall be members ex-officio of the Executive Committee with full
voting power. The Chairman of the Board or the President may from time to time
appoint from the Board of Directors as temporary additional members of the
Executive Committee, with full voting powers, not more than two members to serve
for such periods as the Chairman of the Board or the President may determine.
The Board of Directors shall designate a member of the Executive Committee to
serve as Chairman thereof. A meeting of the Executive Committee may be called
at any time upon the written request of the Chairman of the Board, the President
or the Chairman of the Executive Committee, stating the purpose of the meeting.
Not less than twenty four hours' notice of said meeting shall be given to each
member of the Committee personally, by telephoning, or by mail. The Chairman of
the Executive Committee or, in his absence, a member of the Committee chosen by
a majority of the members present shall preside at meetings of the Executive
Committee.
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<PAGE>
<PAGE>
The Executive Committee shall possess and may exercise all the powers of the
Board when the Board is not in session except such as the Board, only, by law,
is authorized to exercise; it shall keep minutes of its acts and proceedings
and cause same to be presented and reported at every regular meeting and at any
special meeting of the Board including specifically, all its actions relating
to loans and discounts.
All acts done and powers and authority conferred by the Executive Committee,
from time to time, within the scope of its authority, shall be deemed to be,
and may be certified as being, the acts of and under the authority of the
Board.
Section 2. Risk Management Committee. The Board shall appoint from its
members a Risk Management Committee which shall consist of such number as the
Board shall determine. The Board shall designate a member of the Risk
Management Committee to serve as Chairman thereof. It shall be the duty of the
Risk Management Committee to (a) serve as the channel of communication with
management and the Board of Directors of Fleet Financial Group, Inc. to assure
that formal processes supported by management information systems are in place
for the identification, evaluation and management of significant risks inherent
in or associated with lending activities, the loan portfolio, asset-liablity
management, the investment portfolio, trust and investment advisory activities,
the sale of nondeposit investment products and new products and services and
such additional activities or functions as the Board may determine from time
to time; (b) assure the formulation and adoption of policies approved by the
Risk Management Committee or Board governing lending activities, management of
the loan portfolio, the maintenance of an adequate allowance for loan and lease
losses, asset-liability management, the investment portfolio, the retail
sale of non-deposit investment products, new products and services and such
additional activities or functions as the Board may determine from time to time
(c) assure that a comprehensive independent loan review program is in place for
the early detection of problem loans and review significant reports of the loan
review department, management's responses to those reports and the risk
attributed to unresolved issues; (d) subject to control of the Board, exercise
general supervision over trust activities, the investment of trust funds, the
disposition of trust investments and the acceptance of new trusts and the terms
of such acceptance, and (e) perform such additional duties and exercise such
additional powers of the Board as the Board may determine from time to time.
Section 3. Audit Committee. The Board shall appoint from its members and
Audit Committee which shall consist of such number as the Board shall determine
no one of whom shall be an active officer or employee of the Association or
Fleet Financial Group, Inc. or any of its affiliates. In addition, members of
the Audit Committee must not (i) have served as an officer or employee of the
Association or any of its affiliates at any time during the year prior to their
appointment; or (ii) own, control, or have owned or controlled at any time
during the year prior to appointment, ten percent (10%) or more of any
outstanding class of voting securities of the Association. At least two (2)
members of the Audit Committee must have significant executive, professional,
educational or regulatory experience in financial, auditing, accounting,
or banking matters. No member of the Audit Commitee may have significant
direct or indirect credit or other relationships with the Association, the
termination of which would materially adversely affect the Association's
financial condition or results of operations.
The Board shall designate a member of the Audit Committee to serve as Chairman
thereof. It shall be the duty of the Audit Committee to (a) cause a continuous
audit and examination to be made on its behalf into the affairs of the
Association and to review the results of such examination; (b) review
significant reports of the internal auditing department, management's responses
to those reports and the risk attributed to unresolved issues; (c) review the
basis for the reports issued under Section 112 of The Federal Deposit Insurance
Corporation Improvement Act of 1991; (d) consider, in consultation with the
independent auditor and an internal auditing executive, the adequacy of the
Association's internal controls, including the resolution of identified material
weakness and reportable conditions; (e) review regulatory communications
received from any federal or state agency with supervisory jurisdiction or
other examining authority and monitor any needed corrective action by
management; (f) ensure that a formal system of internal controls is in place
for maintaining compliance with laws and regulations; (g) cause an audit of the
Trust Department at least once during each calendar year and within 15 months
of the last such audit or, in liew thereof, adopt a continuous audit system and
report to the Board each calendar year and within 15 months of the previous
report on the performance of such audit function; and (h) perform such
additional duties and exercise such additional powers of the Board as the Board
may determine from time to time.
The Audit Committee may consult with internal counsel and retain its own
outside counsel without approval (prior or otherwise) from the Board or
management and obligate the Association to pay the fees of such counsel.
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<PAGE>
Section 4. Community Affairs Committee. The Board shall appoint from its
members a Community Affairs Committee which shall consist of such number as the
Board shall determine. The Board shall designate a member of the Community
Affairs Committee to serve as Chairman thereof. It shall be the duty of the
Commmunity Affairs Committee to (a) oversee compliance by the Association with
the Community Reinvestment Act of 1977, as amended, and the regulations
promulgated thereunder; and (b) perform such additional duties and exercise such
additional powers of the Board as the Board may determine from time to time.
Section 5. Regular Meetings. Except for the Executive Committee which shall
meet on an ad hoc basis as set forth in Section 1 of this Article, regular
meetings of the Committees of the Board of Directors shall be held, without
notice, at such time and place as the Committee or the Board of Directors may
appoint and as often as the business of the Association may require.
Section 6. Special Meetings. A Special Meeting of any of the Committees of
the Board of Directors may be called upon the written request of the Chairman
of the Board or the President, or of any two members of the respective
Committee, stating the purpose of the meeting. Not less than twenty-four
hours' notice of such special meeting shall be given to each member of the
Committee personally, by telephoning, or by mail.
Section 7. Emergency Meetings. An Emergency Meeting of any of the Committees
of the Board of Directors may be called at the request of the Chairman of the
Board or the President, who shall state that an emergency exists, upon not
less than one hour's notice to each member of the Committee personally or by
telephoning.
Section 8. Action Taken Without a Committee Meeting. Any Committee of the
Board of Directors may take action without a meeting and without notice of such
meeting by resolution assented to in writing by all members of such Committee.
Section 9. Quorum. A majority of a Committee of the Board of Directors shall
constitute a quorum for the transaction of any business at any meeting of such
Committee. If a quorum is not available, the Chairman of the Board or the
President shall have power to make temporary appointments to a Committee of-
members of the Board of Directors, to act in the place and stead of members who
temporarily cannot attend any such meeting; provided, however, that any
temporary appointment to the Audit Committee must meet the requirements for
members of that Committee set forth in Section 3 of this Article.
Section 10. Record. The committes of the Board of Directors shall keep a
record of their respective meetings and proceedings which shall be presented
at the regular meeting of the Board of Directors held in the calendar month
next following the meetings of the Committees. If there is no regular Board
of Directors meeting held in the calendar month next following the meeting of
a Committee, then such Committee's records shall be presented at the next
regular Board of Directors meeting held in a month subsequent to such Committee
meeting.
Section 11. Changes and Vacancies. The Board of Directors shall have power
to change the members of any Committee at any time and to fill vacancies on any
Committee; provided, however, that any newly appointed member of the Audit
Committee must meet the requirements for members of that Committee set forth in
Section 3 of this Article.
Section 12. Other Committees. The Board of Directors may appoint, from time
to time, other committees of one or more persons, for such purposes and with
such powers as the Board may determine.
ARTICLE IV
WAIVER OF NOTICE OF MEETINGS
Section 1. Waiver. Whenever notice is required to be given to any shareholder,
Director, or member of a Committee of the Board of Directors, such notice may
be waived in writing either before or after such meeting by any shareholder,
Director or Committee member respectively, as the case may be, who may be
entitled to such notice; and such notice will be deemed to be waived by
attendance at any such meeting.
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<PAGE>
ARTICLE V
OFFICERS AND AGENTS
Section 1. Officers. The Board shall appoint a Chairman of the Board and a
President, and shall have the power to appoint one or more Executive Vice
Presidents, one or more Senior Vice Presidents, one or more Vice Presidents, a
Cashier, a Secretary, an Auditor, a Controller, one or more Trust Officers and-
such other officers as are deemed necessary or desirable for the proper
transaction of business of the Association. The Chairman of the Board and the
President shall be appointed from members of the Board of Directors. Any two
or more offices, except those of President and Cashier, or Secretary, may be
held by the same person. The Board may, from time to time, by resolution
passed by a majority of the entire Board, designate one or more officers of the
Association or of an affiliate or of Fleet Financial Group, Inc. with power to
appoint one or more Vice Presidents and such other officers of the Association
below the level of Vice President as the officer or officers designated in such
resolution deem necessary or desirable for the proper transaction of the
business of the Association.
Section 2. Chairman of the Board. The chairman of the Board shall preside at
all meetings of the Board of Directors. Subject to definition by the Board of
Directors, he shall have general executive powers and such specific powers and
duties as from time to time may be conferred upon or assigned to him by the
Board of Directors.
Section 3. President. The President shall preside at all meetings of the
Board of Directors if there be no Chairman or if the Chairman be absent.
Subject to definition by the Board of Directors, he shall have general
executive powers and such specific powers and duties as from time to time may
be conferred upon or assigned to him by the Board of Directors.
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<PAGE>
Section 4. Cashier and Secretary. The Cashier shall be the Secretary of the
Board and of the Executive Committee, and shall keep accurate minutes of their
meetings and of all meetings of the shareholders. He shall attend to the
giving of all notices required by these By-laws. He shall be custodian of the
corporate seal, records, documents and papers of the Association. He shall
have such powers and perform such duties as pertain by law or regulation to the
office of Cashier, or as are imposed by these By-laws, or as may be delegated
to him from time to time by the Board of Directors, the Chairman of the Board
or the President.
Section 5. Auditor. The Auditor shall be the chief auditing officer of the
Association. He shall continuously examine the affairs of the Association and
from time to time shall report to the Board of Directors. He shall have such
powers and perform such duties as are conferred upon, or assigned to him by
these By-laws, or as may be delegated to him from time to time by the Board
of Directors.
Section 6. Officers Seriatim. The Board of Directors shall designate from
time to time not less than two officers who shall in the absence or disability
of the Chairman or President or both, succeed seriatim to the duties and
responsibilities of the Chairman and President respectively.
Section 7. Clerks and Agents. The Board of Directors may appoint, from time
to time, such clerks, agents and employees as it may deem advisable for the
prompt and orderly transaction of the business of the Association, define
their duties, fix the salaries to be paid them and dismiss them. Subject to
the authority of the Board of Directors, the Chairman of the Board or the
President, or any other officer of the Association authorized by either of them
may appoint and dismiss all or any clerks, agents and employees and prescribe
their duties and the conditions of their employment, and from time to time
fix their compensation.
Section 8. Tenure. The Chairman of the Board of Directors and the President
shall, except in the case of death, resignation, retirement or disqualification
under these By-laws, or unless removed by the affirmative vote of at least two-
thirds of all of the members of the Board of Directors, hold office for the
term of one year or until their respective successors are appointed. Either
of such officers appointed to fill a vacancy occurring in an unexpired term
shall serve for such unexpired term of such vacancy. All other officers,
clerks, agents, attorneys-in-fact and employees of the Association shall hold
office during the pleasure of the Board of Directors or of the officer or
committee appointing them respectively.
ARTICLE VI
TRUST DEPARTMENT
Section 1. General Powers and Duties. All fiduciary powers of the Association
shall be exercised through the Trust Department, subject to such regulations as
the Comptroller of the Currency shall from time to time establish. The Trust
Department shall be to placed under the management and immediate supervision
of an officer or officers appointed by the Board of Directors. The duties of
all officers of the Trust Department shall be to cause the policies and
instructions of the Board and the Risk Management Committee with respect to the
trusts under their supervision to be carried out, and to supervise the due
performance of the trusts and agencies entrusted to the Association and under
their supervision, in accordance with law and in accordance with the terms of
such trusts and agencies.
-7-
<PAGE>
<PAGE>
ARTICLE VII
BRANCH OFFICES
Section 1. Establishment. The Board of Directors shall have full power to
establish, to discontinue, or, from time to time, to change the location of any
branch office, subject to such limitations as may be provided by law.
Section 2. Supervision and Control. Subject to the general supervision and
control of the Board of Directors, the affairs of branch offices shall be
under the immediate supervision and control of the President or of such other
officer or officers, employee or employees, or other individuals as the Board
of Directors may from time to time determine, with such powers and duties as
the Board of Directors may confer upon or assign to him or them.
ARTICLE VIII
SIGNATURE POWERS
Section 1. Authorization. The power of officers, employees, agents and
attorneys to sign on behalf of and to affix the seal of the Association shall
be prescribed by the Board of Directors or by the Executive Committee or by
both; provided that the President is authorized to restrict such power of any
officer, employee, agent or attorney to the business of a specific department
or departments, or to a specific branch office or branch offices. Facsimile
signatures may be authorized.
-8-
<PAGE>
<PAGE>
ARTICLE IX
STOCK CERTIFICATES AND TRANSFERS
Section 1. Stock Records. The Trust Department shall have custody of the
stock certificate books and stock ledgers of the Association, and shall make
all transfers of stock, issue certificates thereof and disburse dividends
declared thereon.
Section 2. Form of Certificate. Every shareholder shall be entitled to a
certificate conforming to the requirements of law and otherwise in such form
as the Board of Directors may approve. The certificates shall state on the
face thereof that the stock is transferable only on the books of the
Association and shall be signed by such officers as may be prescribed from time
to time by the Board of Directors or Executive Committee. Facsimile signatures
may be authorized.
Section 3. Transfers of Stock. Transfers of stock shall be made only on the
books of the Association by the holder in person, or by attorney duly
authorized in writing, upon surrender of the certificate therefor properly
endorsed, or upon the surrender of such certificate accompanied by a properly
executed written assignment of the same, or a written power of attorney to
sell, assign or transfer the same or the shares represented thereby.
Section 4. Lost Certificate. The Board of Directors or Executive Committee
may order a new certificate to be issued in place of a certificate lost or
destroyed, upon proof of such loss or destruction and upon tender to the
Association by the shareholder, of a bond in such amount and with or without
surety, as may be ordered, indemnifying the Association against all liability,
loss, cost and damage by reason of such loss or destruction and the issuance
of a new certificate.
Section 5. Closing Transfer Books. The Board of Directors may close the
transfer books for a period not exceeding thirty days preceding any regular
or special meeting of the shareholders, or the day designated for the payment
of a dividend or the allotment of rights. In lieu of closing the transfer
books the Board of Directors may fix a day and hour not more than thirty days
prior to the day of holding any meeting of the shareholders, or the day
designated for the payment of a dividend, or the day designated for the
allotment of rights, or the day when any change of conversion or exchange of
capital stock is to go into effect, as the day as of which shareholders
entitled to notice of and to vote at such meetings or entitled to such dividend
or to such allotment of rights or to exercise the rights in respect of any
such change, conversion or exchange of capital stock, shall be determined, and
only such shareholders as shall be shareholders of record on the day and hour
so fixed shall be entitled to notice of and to vote at such meeting or to
receive payment of such dividend or to receive such allotment of rights or to
exercise such rights, as the case may be.
ARTICLE X
THE CORPORATE SEAL
Section 1. Seal. The following is an impression of the seal of the
Association adopted by the Board of Directors.
ARTICLE XI
BUSINESS HOURS
Section 1. Business Hours. The main office of this Association and each
branch office thereof shall be open for business on such days, and for such
hours as the Chairman, or the President, or any Executive Vice President, or
such other officer as the Board of Directors shall from time to time
designate, may determine as to each office to conform to local custom and
convenience, provided that any one or more of the main and branch offices or
certain departments thereof may be open for such hours as the President, or
such other officer as the Board of Directors shall from time to time designate,
may determine as to each office or department on any legal holiday on which
work is not prohibited by law, and provided further that any one or more of
the main and branch offices or certain departments thereof may be ordered
closed or open on any day for such hours as to each office or department as
the President, or such other officer as the Board of Directors shall from time
to time designate, subject to applicable laws regulations, may determine when
such action may be required by reason of disaster or other emergency condition.
ARTICLE IX
CHANGES IN BY-LAWS
Section 1. Amendments. These By-laws may be amended upon vote of a majority
of the entire Board of Directors at any meeting of the Board, provided ten (10)
day's notice of the proposed amendment has been given to each member of the
Board of Directors. No amendment may be made unless the By-law, as amended, is
consistent with the requirements of law and of the Articles of Association.
These By-laws may also be amended by the Association's shareholders.
A true copy
Attest:
Secretary/Assistant Secretary
- ---------------------------------------
Dated at , as of .
--------------------------------------- ----------------------
Revision of January 11, 1993
-9-
<PAGE>
<PAGE>
EXHIBIT 5
CONSENT OF THE TRUSTEE
REQUIRED BY SECTION 321(b)
OF THE TRUST INDENTURE ACT OF 1939
The undersigned, as Trustee under the Indenture to be entered into between
Leucadia National Corporation and Fleet National Bank, as Trustee,
does hereby consent that, pursuant to Section 321(b) of the Trust Indenture
Act of 1939, reports of examinations with respect to the undersigned by Federal,
State, Territorial or District authorities may be furnished by such authorities
to the Securities and Exchange Commission upon request therefor.
FLEET NATIONAL BANK,
AS TRUSTEE
By /s/ Robert L. Reynolds
-------------------------------
Robert L. Reynolds
Its: Vice President
Dated:
<PAGE>
<PAGE>
Board of Governors of the Federal Reserve System
OMB Number: 7100-0036
Federal Deposit Insurance Corporation
OMB Number: 3064-0052
Office of the Comptroller of the Currency
OMB Number: 1557-0081
Expires March 31, 1999
Federal Financial Institutions Examination Council
- --------------------------------------------------------------------------------
[FEDERAL FINANCIAL Please refer to page i, [1]
INSTITUTIONS EXAMINATION Table of Contents, for
COUNCIL LOGO] the required disclosure
of estimated burden.
- --------------------------------------------------------------------------------
CONSOLIDATED REPORTS OF CONDITION AND INCOME FOR
A BANK WITH DOMESTIC AND FOREIGN OFFICES--FFIEC 031
(960630)
REPORT AT THE CLOSE OF BUSINESS JUNE 30, 1996 -----------
(RCRI 9999)
This report is required by law: 12 U.S.C. Section 324 (State member banks);
12 U.S.C. Section 1817 (State nonmember banks); and 12 U.S.C. Section 161
(National banks).
This report form is to be filed by banks with branches and consolidated
subsidiaries in U.S. territories and possessions, Edge or Agreement
subsidiaries, foreign branches, consolidated foreign subsidiaries, or
International Banking Facilities.
- --------------------------------------------------------------------------------
NOTE: The Reports of Condition and Income must be signed by an authorized
officer and the Report of Condition must be attested to by not less than two
directors (trustees) for State nonmember banks and three directors for State
member and National banks.
I, Giro S. DeRosa, Vice President
-----------------------------------------------------------------------------
Name and Title of Officer Authorized to Sign Report
of the named bank do hereby declare that these Reports of Condition and
Income (including the supporting schedules) have been prepared in conformance
with the instructions issued by the appropriate Federal regulatory authority
and are true to the best of my knowledge and belief.
/s/ Giro DeRosa
- --------------------------------------------------------------------------------
Signature of Officer Authorized to Sign Report
July 25, 1996
- --------------------------------------------------------------------------------
Date of Signature
The Reports of Condition and Income are to be prepared in accordance with
Federal regulatory authority instructions. NOTE: These instructions may in
some cases differ from generally accepted accounting principles.
We, the undersigned directors (trustees), attest to the correctness of this
Report of Condition (including the supporting schedules) and declare that it has
been examined by us and to the best of our knowledge and belief has been
prepared in conformance with the instructions issued by the appropriate Federal
regulatory authority and is true and correct.
/s/
- --------------------------------------------------------------------------------
Director (Trustee)
/s/
- --------------------------------------------------------------------------------
Director (Trustee)
/s/
- --------------------------------------------------------------------------------
Director (Trustee)
- --------------------------------------------------------------------------------
For Banks Submitting Hard Copy Report Forms:
State Member Banks: Return the original and one copy to the appropriate Federal
Reserve District Bank.
State Nonmember Banks: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return
address envelope, return the original only to the FDIC, c/o Quality Data
systems, 2127 Espey Court, Suite 204, Crofton, MD 21114.
National Banks: Return the original only in the special return address envelope
provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems, 2127
Espey Court, Suite 204, Crofton, MD 21114.
- --------------------------------------------------------------------------------
FDIC Certificate Number | 0 | 2 | 4 | 9 | 9 | Banks should affix
--------------------- the address label
(RCRI 90150) in this space.
CALL NO. 196 31 06-30-96
STAR: 25-0590 00327 STCERT: 25-02490
FLEET NATIONAL BANK
ONE MONARCH PLACE
SPRINGFIELD, MA 01102
Board of Governors of the Federal Reserve System, Federal Deposit
Insurance Corporation, Office of the Comptroller of the Currency
<PAGE>
<PAGE>
FOR BANKS SUBMITTING HARD COPY REPORT FORMS:
STATE MEMBER BANKS: Return the original and one copy to the appropriate Federal
Reserve District Bank.
STATE NONMEMBER BANKS: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems, 2127
Espey Court, Suite 204, Crofton, MD 21114.
NATIONAL BANKS: Return the original only in the special return address envelope
provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems, 2127
Espey Court, Suite 204, Crofton, MD 21114.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
___ ___
FDIC Certificate Number | 0 | 2 | 4 | 9 | 9 | | Banks should affix the address label in this space. |
______________________
(RCRI 9050) CALL NO. 196 31 06-30-96
STBK: 25-0590 00327 STCERT: 25-02499
FLEET NATIONAL BANK
ONE MONARCH PLACE
SPRINGFIELD, MA 01102
|___ ___|
</TABLE>
Board of Governors of the Federal Reserve System, Federal Deposit Insurance
Corporation, Office of the Comptroller of the Currency
<PAGE>
<PAGE>
FFIEC 031
Page i
/2/
Consolidated Reports of Condition and Income for
A Bank With Domestic and Foreign Offices
________________________________________________________________________________
TABLE OF CONTENTS
SIGNATURE PAGE Cover
REPORT OF INCOME
Schedule RI--Income Statement...........................................RI-1,2,3
Schedule RI-A--Changes in Equity Capital....................................RI-4
Schedule RI-B--Charge-offs and Recoveries and
Changes in Allowance for Loan and Lease
Losses..................................................................RI-4,5
Schedule RI-C--Applicable Income Taxes by
Taxing Authority..........................................................RI-5
Schedule RI-D--Income from
International Operations..................................................RI-6
Schedule RI-E--Explanations...............................................RI-7,8
REPORT OF CONDITION
Schedule RC--Balance Sheet................................................RC-1,2
Schedule RC-A--Cash and Balances Due
From Depository Institutions..............................................RC-3
Schedule RC-B--Securities...............................................RC-3,4,5
Schedule RC-C--Loans and Lease Financing
Receivables:
Part I. Loans and Leases..............................................RC-6,7
Part II. Loans to Small Businesses and
Small Farms (included in the forms for
June 30 only).....................................................RC-7a,7b
Schedule RC-D--Trading Assets and Liabilities
(to be completed only by selected banks)..................................RC-8
Schedule RC-E--Deposit Liabilities....................................RC-9,10,11
Schedule RC-F--Other Assets................................................RC-11
Schedule RC-G--Other Liabilities...........................................RC-11
Schedule RC-H--Selected Balance Sheet Items for
Domestic Offices.........................................................RC-12
Schedule RC-I--Selected Assets and Liabilities
of IBFs..................................................................RC-13
Schedule RC-K--Quarterly Averages..........................................RC-13
Schedule RC-L--Off-Balance Sheet Items...............................RC-14,15,16
Schedule RC-M--Memoranda................................................RC-17,18
Schedule RC-N--Past Due and Nonaccrual Loans,
Leases, and Other Assets..............................................RC-19,20
Schedule RC-O--Other Data for Deposit
Insurance Assessments.................................................RC-21,22
Schedule RC-R--Regulatory Capital.......................................RC-23,24
Optional Narrative Statement Concerning the
Amounts Reported in the Reports of
Condition and Income.....................................................RC-25
Special Report (TO BE COMPLETED BY ALL BANKS)
Schedule RC-J--Repricing Opportunities (sent only to
and to be completed only by savings banks)
DISCLOSURE OF ESTIMATED BURDEN
The estimated average burden associated with this information collection is
32.2 hours per respondent and is estimated to vary from 15 to 230 hours per
response, depending on individual circumstances. Burden estimates include the
time for reviewing instructions, gathering and maintaining data in the required
form, and completing the information collection, but exclude the time for
compiling and maintaining business records in the normal course of a
respondent's activities. Comments concerning the accuracy of this burden
estimate and suggestions for reducing this burden should be directed to the
Office of Information and Regulatory Affairs, Office of Management and Budget,
Washington, D.C. 20503, and to one of the following:
Secretary
Board of Governors of the Federal Reserve System
Washington, D.C. 20551
Legislative and Regulatory Analysis Division
Office of the Comptroller of the Currency
Washington, D.C. 20219
Assistant Executive Secretary
Federal Deposit Insurance Corporation
Washington, D.C. 20429
For information or assistance, National and State nonmember banks should
contact the FDIC's Call Reports Analysis Unit, 550 17th Street, NW, Washington,
D.C. 20429, toll free on (800) 688-FDIC (3342), Monday through Friday between
8:00 a.m. and 5:00 p.m., Eastern time. State member banks should contact their
Federal Reserve District Bank.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RI-1
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
Consolidated Report of Income
for the period January 1, 1996 - June 30, 1996
All Report of Income schedules are to be reported on a calendar year-to-date
basis in thousands of dollars.
<TABLE>
<CAPTION>
Schedule RI--Income Statement _________
| I480 |
______________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
______________________________________________________________________________________________|_____________________|
<S> <C> <C>
1. Interest income: | ////////////////// |
a. Interest and fee income on loans: | ////////////////// |
(1) In domestic offices: | ////////////////// |
(a) Loans secured by real estate .................................................. | 4011 616,395 | 1.a.(1)(a)
(b) Loans to depository institutions .............................................. | 4019 588 | 1.a.(1)(b)
(c) Loans to finance agricultural production and other loans to farmers ........... | 4024 286 | 1.a.(1)(c)
(d) Commercial and industrial loans ............................................... | 4012 562,807 | 1.a.(1)(d)
(e) Acceptances of other banks .................................................... | 4026 261 | 1.a.(1)(e)
(f) Loans to individuals for household, family, and other personal expenditures: | ////////////////// |
(1) Credit cards and related plans ............................................ | 4054 9,643 | 1.a.(1)(f)(1)
(2) Other ..................................................................... | 4055 97,346 | 1.a.(1)(f)(2)
(g) Loans to foreign governments and official institutions ........................ | 4056 0 | 1.a.(1)(g)
(h) Obligations (other than securities and leases) of states and political | ////////////////// |
subdivisions in the U.S.: | ////////////////// |
(1) Taxable obligations ....................................................... | 4503 0 | 1.a.(1)(h)(1)
(2) Tax-exempt obligations .................................................... | 4504 5,232 | 1.a.(1)(h)(2)
(i) All other loans in domestic offices ........................................... | 4058 84,576 | 1.a.(1)(i)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs ..................... | 4059 1,981 | 1.a.(2)
b. Income from lease financing receivables: | ////////////////// |
(1) Taxable leases .................................................................... | 4505 75,341 | 1.b.(1)
(2) Tax-exempt leases ................................................................. | 4307 791 | 1.b.(2)
c. Interest income on balances due from depository institutions:(1) | ////////////////// |
(1) In domestic offices ............................................................... | 4105 914 | 1.c.(1)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs ..................... | 4106 142 | 1.c.(2)
d. Interest and dividend income on securities: | ////////////////// |
(1) U.S. Treasury securities and U.S. Government agency and corporation obligations ... | 4027 209,142 | 1.d.(1)
(2) Securities issued by states and political subdivisions in the U.S.: | ////////////////// |
(a) Taxable securities ............................................................ | 4506 0 | 1.d.(2)(a)
(b) Tax-exempt securities ......................................................... | 4507 2,953 | 1.d.(2)(b)
(3) Other domestic debt securities .................................................... | 3657 12,164 | 1.d.(3)
(4) Foreign debt securities ........................................................... | 3658 3,348 | 1.d.(4)
(5) Equity securities (including investments in mutual funds) ......................... | 3659 10,212 | 1.d.(5)
e. Interest income from trading assets.................................................... | 4069 360 | 1.e.
______________________
</TABLE>
____________
(1) Includes interest income on time certificates of deposit not held for
trading.
3
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RI-2
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI--Continued
________________
Dollar Amounts in Thousands | Year-to-date |
___________________________________________________________________________________ ______________
<S> <C> <C>
1. Interest income (continued) | RIAD Bil Mil Thou |
f. Interest income on 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 .................... | 4020 24,925 | 1.f.
g. Total interest income (sum of items 1.a through 1.f) ................ | 4107 1,719,407 | 1.g.
2. Interest expense: | ////////////////// |
a. Interest on deposits: | ////////////////// |
(1) Interest on deposits in domestic offices: | ////////////////// |
(a) Transaction accounts (NOW accounts, ATS accounts, and | ////////////////// |
telephone and preauthorized transfer accounts) .............. | 4508 8,583 | 2.a.(1)(a)
(b) Nontransaction accounts: | ////////////////// |
(1) Money market deposit accounts (MMDAs) ................... | 4509 133,915 | 2.a.(1)(b)(1)
(2) Other savings deposits .................................. | 4511 26,678 | 2.a.(1)(b)(2)
(3) Time certificates of deposit of $100,000 or more ........ | 4174 88,690 | 2.a.(1)(b)(3)
(4) All other time deposits ................................. | 4512 214,225 | 2.a.(1)(b)(4)
(2) Interest on deposits in foreign offices, Edge and Agreement | ////////////////// |
subsidiaries, and IBFs .......................................... | 4172 50,022 | 2.a.(2)
b. Expense of 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 .................... | 4180 152,094 | 2.b.
c. Interest on demand notes issued to the U.S. Treasury, trading | ////////////////// |
liabilities, and other borrowed money ............................... | 4185 121,525 | 2.c.
d. Interest on mortgage indebtedness and obligations under | ////////////////// |
capitalized leases .................................................. | 4072 361 | 2.d.
e. Interest on subordinated notes and debentures ....................... | 4200 26,110 | 2.e.
f. Total interest expense (sum of items 2.a through 2.e) ............... | 4073 822,203 | 2.f.
___________________________
3. Net interest income (item 1.g minus 2.f) ............................... | ////////////////// | RIAD 4074 | 897,204 | 3.
___________________________
4. Provisions: | ////////////////// |
___________________________
a. Provision for loan and lease losses ................................. | ////////////////// | RIAD 4230 | 21,672 | 4.a.
b. Provision for allocated transfer risk ............................... | ////////////////// | RIAD 4243 | 0 | 4.b.
___________________________
5. Noninterest income: | ////////////////// |
a. Income from fiduciary activities .................................... | 4070 144,614 | 5.a.
b. Service charges on deposit accounts in domestic offices ............. | 4080 111,736 | 5.b.
c. Trading revenue (must equal Schedule RI, sum of Memorandum | ////////////////// |
items 8.a through 8.d)............................................... A220 10,646 5.c.
d. Other foreign transaction gains (losses) ............................ | 4076 247 | 5.d.
e. Not applicable | ////////////////// |
f. Other noninterest income: | ////////////////// |
(1) Other fee income ................................................ | 5407 372,950 | 5.f.(1)
(2) All other noninterest income* ................................... | 5408 211,593 | 5.f.(2)
___________________________
g. Total noninterest income (sum of items 5.a through 5.f) ............. | ////////////////// | RIAD 4079 | 851,786 | 5.g.
6. a. Realized gains (losses) on held-to-maturity securities .............. | ////////////////// | RIAD 3521 | 1 | 6.a.
b. Realized gains (losses) on available-for-sale securities ............ | ////////////////// | RIAD 3196 | 16,126 | 6.b.
___________________________
7. Noninterest expense: | ////////////////// |
a. Salaries and employee benefits ...................................... | 4135 322,146 | 7.a.
b. Expenses of premises and fixed assets (net of rental income) | ////////////////// |
(excluding salaries and employee benefits and mortgage interest) .... | 4217 114,912 | 7.b.
c. Other noninterest expense* .......................................... | 4092 631,554 | 7.c.
___________________________
d. Total noninterest expense (sum of items 7.a through 7.c) ............ | ////////////////// | RIAD 4093 | 1,068,612 | 7.d.
___________________________
8. Income (loss) before income taxes and extraordinary items and other | ////////////////// |
___________________________
adjustments (item 3 plus or minus items 4.a, 4.b, 5.g, 6.a, 6.b, and 7.d)| ////////////////// | RIAD 4301 | 674,833 | 8.
9. Applicable income taxes (on item 8) .................................... | ////////////////// | RIAD 4302 | 280,303 | 9.
___________________________
10. Income (loss) before extraordinary items and other adjustments | ////////////////// |
___________________________
(item 8 minus 9) ....................................................... | ////////////////// | RIAD 4300 | 394,530 | 10.
_________________________________________________
</TABLE>
____________
*Describe on Schedule RI-E--Explanations.
4
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RI-3
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI--Continued
________________
| Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
___________________________________________________________________________________ ______________
<S> <C> <C>
11. Extraordinary items and other adjustments: | ////////////////// |
a. Extraordinary items and other adjustments, gross of income taxes* . | 4310 0 | 11.a.
b. Applicable income taxes (on item 11.a)* ........................... | 4315 0 | 11.b.
c. Extraordinary items and other adjustments, net of income taxes | ////////////////// |__________________________
(item 11.a minus 11.b) ............................................ | ////////////////// | RIAD 4320 | 0 | 11.c.
12. Net income (loss) (sum of items 10 and 11.c) ......................... | ////////////////// | RIAD 4340 | 394,530 | 12.
_________________________________________________
</TABLE>
<TABLE>
<CAPTION>
__________
| I481 |
_______________
Memoranda | Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
______________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Interest expense incurred to carry tax-exempt securities, loans, and leases acquired after | ////////////////// |
August 7, 1986, that is not deductible for federal income tax purposes .......................... | 4513 1,798 | M.1.
2. Income from the sale and servicing of mutual funds and annuities in domestic offices | ////////////////// |
(included in Schedule RI, item 8) ............................................................... | 8431 20,910 | M.2.
3.-4. Not applicable | ////////////////// |
5. Number of full-time equivalent employees on payroll at end of current period (round to | //// Number |
nearest whole number) ........................................................................... | 4150 9,852 | M.5.
6. Not applicable | ////////////////// |
7. If the reporting bank has restated its balance sheet as a result of applying push down | //// MM DD YY |
accounting this calendar year, report the date of the bank's acquisition ........................ | 9106 00/00/00 | M.7.
8. Trading revenue (from cash instruments and off-balance sheet derivative instruments) | ////////////////// |
(sum of Memorandum items 8.a through 8.d must equal Schedule RI, item 5.c): | //// Bil Mil Thou |
a. Interest rate exposures ...................................................................... | 8757 1,428 | M.8.a.
b. Foreign exchange exposures ................................................................... | 8758 9,218 | M.8.b.
c. Equity security and index exposures .......................................................... | 8759 0 | M.8.c.
d. Commodity and other exposures ................................................................ | 8760 0 | M.8.d.
9. Impact on income of off-balance sheet derivatives held for purposes other than trading: | ////////////////// |
a. Net increase (decrease) to interest income.....................................................| 8761 (5,575)| M.9.a.
b. Net (increase) decrease to interest expense ...................................................| 8762 (5,752)| M.9.b.
c. Other (noninterest) allocations ...............................................................| 8763 (172)| M.9.c.
10. Credit losses on off-balance sheet derivatives (see instructions).................................| A251 0 | M.10.
</TABLE>
____________
*Describe on Schedule RI-E--Explanations.
5
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RI-4
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI-A--Changes in Equity Capital
Indicate decreases and losses in parentheses. _________
| I483 |
_____________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
______________________________________________________________________________________________________|____________________|
<S> <C> <C>
1. Total equity capital originally reported in the December 31, 1995, Reports of Condition | ////////////////// |
and Income ...................................................................................... | 3215 1,342,473 | 1.
2. Equity capital adjustments from amended Reports of Income, net* ................................. | 3216 0 | 2.
3. Amended balance end of previous calendar year (sum of items 1 and 2) ............................ | 3217 1,342,473 | 3.
4. Net income (loss) (must equal Schedule RI, item 12) ............................................. | 4340 394,530 | 4.
5. Sale, conversion, acquisition, or retirement of capital stock, net .............................. | 4346 0 | 5.
6. Changes incident to business combinations, net .................................................. | 4356 4,161,079 | 6.
7. LESS: Cash dividends declared on preferred stock ................................................ | 4470 0 | 7.
8. LESS: Cash dividends declared on common stock ................................................... | 4460 490,634 | 8.
9. Cumulative effect of changes in accounting principles from prior years* (see instructions | ////////////////// |
for this schedule) .............................................................................. | 4411 0 | 9.
10. Corrections of material accounting errors from prior years* (see instructions for this schedule) | 4412 0 | 10.
11. Change in net unrealized holding gains (losses) on available-for-sale securities ................ | 8433 (46,607)| 11.
12. Foreign currency translation adjustments ........................................................ | 4414 0 | 12.
13. Other transactions with parent holding company* (not included in items 5, 7, or 8 above) ........ | 4415 (1,003,722)| 13.
14. Total equity capital end of current period (sum of items 3 through 13) (must equal Schedule RC, | ////////////////// |
item 28) ........................................................................................ | 3210 4,357,119 | 14.
______________________
</TABLE>
____________
*Describe on Schedule RI-E--Explanations.
<TABLE>
<CAPTION>
Schedule RI-B--Charge-offs and Recoveries and Changes
in Allowance for Loan and Lease Losses
Part I. Charge-offs and Recoveries on Loans and Leases
Part I excludes charge-offs and recoveries through
the allocated transfer risk reserve.
__________
| I486 |
__________________________________________
| (Column A) | (Column B) |
| Charge-offs | Recoveries |
____________________ ____________________
| Calendar year-to-date |
_________________________________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou | RIAD Bil Mil Thou |
______________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
1. Loans secured by real estate: | ////////////////// | ////////////////// |
a. To U.S. addressees (domicile) ......................................... | 4651 35,701 | 4661 8,412 | 1.a.
b. To non-U.S. addressees (domicile) ..................................... | 4652 0 | 4662 0 | 1.b.
2. Loans to depository institutions and acceptances of other banks: | ////////////////// | ////////////////// |
a. To U.S. banks and other U.S. depository institutions .................. | 4653 0 | 4663 0 | 2.a.
b. To foreign banks ...................................................... | 4654 0 | 4664 0 | 2.b.
3. Loans to finance agricultural production and other loans to farmers ...... | 4655 2 | 4665 22 | 3.
4. Commercial and industrial loans: | ////////////////// | ////////////////// |
a. To U.S. addressees (domicile) ......................................... | 4645 38,139 | 4617 19,005 | 4.a.
b. To non-U.S. addressees (domicile) ..................................... | 4646 0 | 4618 102 | 4.b.
5. Loans to individuals for household, family, and other personal | ////////////////// | ////////////////// |
expenditures: | ////////////////// | ////////////////// |
a. Credit cards and related plans ........................................ | 4656 1,137 | 4666 733 | 5.a.
b. Other (includes single payment, installment, and all student loans) ... | 4657 7,864 | 4667 2,681 | 5.b.
6. Loans to foreign governments and official institutions ................... | 4643 0 | 4627 0 | 6.
7. All other loans .......................................................... | 4644 826 | 4628 541 | 7.
8. Lease financing receivables: | ////////////////// | ////////////////// |
a. Of U.S. addressees (domicile) ......................................... | 4658 3,729 | 4668 3,241 | 8.a.
b. Of non-U.S. addressees (domicile) ..................................... | 4659 0 | 4669 0 | 8.b.
9. Total (sum of items 1 through 8) ......................................... | 4635 87,398 | 4605 34,737 | 9.
___________________________________________
</TABLE>
6
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RI-5
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI-B--Continued
Part I. Continued
Memoranda
__________________________________________
| (Column A) | (Column B) |
| Charge-offs | Recoveries |
____________________ ____________________
| Calendar year-to-date |
_________________________________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou | RIAD Bil Mil Thou |
______________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
1-3. Not applicable | ////////////////// | ////////////////// |
4. Loans to finance commercial real estate, construction, and land | ////////////////// | ////////////////// |
development activities (not secured by real estate) included in | ////////////////// | ////////////////// |
Schedule RI-B, part I, items 4 and 7, above .............................. | 5409 383 | 5410 1,374 | M.4.
5. Loans secured by real estate in domestic offices (included in | ////////////////// | ////////////////// |
Schedule RI-B, part I, item 1, above): | ////////////////// | ////////////////// |
a. Construction and land development ..................................... | 3582 189 | 3583 253 | M.5.a.
b. Secured by farmland ................................................... | 3584 145 | 3585 131 | M.5.b.
c. Secured by 1-4 family residential properties: | ////////////////// | ////////////////// |
(1) Revolving, open-end loans secured by 1-4 family residential | ////////////////// | ////////////////// |
properties and extended under lines of credit ..................... | 5411 2,650 | 5412 108 | M.5.c.(1)
(2) All other loans secured by 1-4 family residential properties ...... | 5413 13,892 | 5414 1,231 | M.5.c.(2)
d. Secured by multifamily (5 or more) residential properties ............. | 3588 837 | 3589 395 | M.5.d.
e. Secured by nonfarm nonresidential properties .......................... | 3590 17,988 | 3591 6,294 | M.5.e.
|_________________________________________|
</TABLE>
Part II. Changes in Allowance for Loan and Lease Losses
<TABLE>
<CAPTION>
_____________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
___________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Balance originally reported in the December 31, 1995, Reports of Condition and Income.......... | 3124 266,943 | 1.
2. Recoveries (must equal part I, item 9, column B above) ........................................ | 4605 34,737 | 2.
3. LESS: Charge-offs (must equal part I, item 9, column A above) ................................. | 4635 87,398 | 3.
4. Provision for loan and lease losses (must equal Schedule RI, item 4.a)......................... | 4230 21,672 | 4.
5. Adjustments* (see instructions for this schedule) ................................ ............ | 4815 636,497 | 5.
6. Balance end of current period (sum of items 1 through 5) (must equal Schedule RC, | ////////////////// |
item 4.b) ..................................................................................... | 3123 872,451 | 6.
|____________________|
</TABLE>
____________
*Describe on Schedule RI-E--Explanations.
Schedule RI-C--Applicable Income Taxes by Taxing Authority
Schedule RI-C is to be reported with the December Report of Income.
<TABLE>
<CAPTION>
| I489 | <-
____________ ________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
___________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Federal ....................................................................................... | 4780 N/A | 1.
2. State and local................................................................................ | 4790 N/A | 2.
3. Foreign ....................................................................................... | 4795 N/A | 3.
4. Total (sum of items 1 through 3) (must equal sum of Schedule RI, items 9 and 11.b) ............ | 4770 N/A | 4.
____________________________| |
5. Deferred portion of item 4 ........................................ | RIAD 4772 | N/A | ////////////////// | 5.
__________________________________________________
</TABLE>
7
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: Fleet National Bank Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: One Monarch Place Page RI-6
City, State Zip: Springfield, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI-D--Income from International Operations
For all banks with foreign offices, Edge or Agreement subsidiaries, or IBFs where international operations
account for more than 10 percent of total revenues, total assets, or net income.
Part I. Estimated Income from International Operations
__________
| I492 | <-
______ ________
| Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
_________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Interest income and expense booked at foreign offices, Edge and Agreement subsidiaries, | ////////////////// |
and IBFs: | ////////////////// |
a. Interest income booked ................................................................... | 4837 N/A | 1.a.
b. Interest expense booked .................................................................. | 4838 N/A | 1.b.
c. Net interest income booked at foreign offices, Edge and Agreement subsidiaries, and IBFs | ////////////////// |
(item 1.a minus 1.b) ..................................................................... | 4839 N/A | 1.c.
2. Adjustments for booking location of international operations: | ////////////////// |
a. Net interest income attributable to international operations booked at domestic offices .. | 4840 N/A | 2.a.
b. Net interest income attributable to domestic business booked at foreign offices .......... | 4841 N/A | 2.b.
c. Net booking location adjustment (item 2.a minus 2.b) ..................................... | 4842 N/A | 2.c.
3. Noninterest income and expense attributable to international operations: | ////////////////// |
a. Noninterest income attributable to international operations .............................. | 4097 N/A | 3.a.
b. Provision for loan and lease losses attributable to international operations ............. | 4235 N/A | 3.b.
c. Other noninterest expense attributable to international operations ....................... | 4239 N/A | 3.c.
d. Net noninterest income (expense) attributable to international operations (item 3.a | ////////////////// |
minus 3.b and 3.c) ....................................................................... | 4843 N/A | 3.d.
4. Estimated pretax income attributable to international operations before capital allocation | ////////////////// |
adjustment (sum of items 1.c, 2.c, and 3.d) ................................................. | 4844 N/A | 4.
5. Adjustment to pretax income for internal allocations to international operations to reflect | ////////////////// |
the effects of equity capital on overall bank funding costs ................................. | 4845 N/A | 5.
6. Estimated pretax income attributable to international operations after capital allocation | ////////////////// |
adjustment (sum of items 4 and 5) ........................................................... | 4846 N/A | 6.
7. Income taxes attributable to income from international operations as estimated in item 6 .... | 4797 N/A | 7.
8. Estimated net income attributable to international operations (item 6 minus 7) .............. | 4341 N/A | 8.
______________________
<CAPTION>
Memoranda ______________________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
_________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Intracompany interest income included in item 1.a above ..................................... | 4847 N/A | M.1.
2. Intracompany interest expense included in item 1.b above .................................... | 4848 N/A | M.2.
______________________
</TABLE>
<TABLE>
<CAPTION>
Part II. Supplementary Details on Income from International Operations Required
by the Departments of Commerce and Treasury for Purposes of the U.S.
International Accounts and the U.S. National Income and Product Accounts
________________
| Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
_________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Interest income booked at IBFs .............................................................. | 4849 N/A | 1.
2. Interest expense booked at IBFs ............................................................. | 4850 N/A | 2.
3. Noninterest income attributable to international operations booked at domestic offices | ////////////////// |
(excluding IBFs): | ////////////////// |
a. Gains (losses) and extraordinary items ................................................... | 5491 N/A | 3.a.
b. Fees and other noninterest income ........................................................ | 5492 N/A | 3.b.
4. Provision for loan and lease losses attributable to international operations booked at | ////////////////// |
domestic offices (excluding IBFs) ........................................................... | 4852 N/A | 4.
5. Other noninterest expense attributable to international operations booked at domestic offices | ////////////////// |
(excluding IBFs) ............................................................................ | 4853 N/A | 5.
______________________
</TABLE>
8
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: Fleet National Bank Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: One Monarch Place Page RI-7
City, State Zip: Springfield, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI-E--Explanations
Schedule RI-E is to be completed each quarter on a calendar year-to-date basis.
Detail all adjustments in Schedules RI-A and RI-B, all extraordinary items and other adjustments in Schedule RI, and all
significant items of other noninterest income and other noninterest expense in Schedule RI. (See instructions for details.)
__________
| I495 | <-
______ ________
| Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. All other noninterest income (from Schedule RI, item 5.f.(2)) | ////////////////// |
Report amounts that exceed 10% of Schedule RI, item 5.f.(2): | ////////////////// |
a. Net gains on other real estate owned ..................................................... | 5415 0 | 1.a.
b. Net gains on sales of loans .............................................................. | 5416 0 | 1.b.
c. Net gains on sales of premises and fixed assets .......................................... | 5417 0 | 1.c.
Itemize and describe the three largest other amounts that exceed 10% of | ////////////////// |
Schedule RI, item 5.f.(2): | ////////////////// |
_____________
d. | TEXT 4461 | Income on Mortgages Held for Resale | 4461 81,194 | 1.d.
e. | TEXT 4462 | Gain From Branch Divestitures | 4462 77,976 | 1.e.
___________
f. | TEXT 4463 |______________________________________________________________________________| 4463 | 1.f.
_____________
2. Other noninterest expense (from Schedule RI, item 7.c): | ////////////////// |
a. Amortization expense of intangible assets ................................................ | 4531 135,939 | 2.a.
Report amounts that exceed 10% of Schedule RI, item 7.c: | ////////////////// |
b. Net losses on other real estate owned .................................................... | 5418 0 | 2.b.
c. Net losses on sales of loans ............................................................. | 5419 0 | 2.c.
d. Net losses on sales of premises and fixed assets ......................................... | 5420 0 | 2.d.
Itemize and describe the three largest other amounts that exceed 10% of | ////////////////// |
Schedule RI, item 7.c: | ////////////////// |
_____________
e. | TEXT 4464 | Intercompany Corporate Support Function Charges | 4464 143,184 | 2.e.
___________
f. | TEXT 4467 | Intercompany Data Processing & Programming Charges | 4467 158,034 | 2.f.
___________
g. | TEXT 4468 |______________________________________________________________________________| 4468 | 2.g.
_____________
3. Extraordinary items and other adjustments (from Schedule RI, item 11.a) and | ////////////////// |
applicable income tax effect (from Schedule RI, item 11.b) (itemize and describe | ////////////////// |
all extraordinary items and other adjustments): | ////////////////// |
_____________
a. (1) | TEXT 4469 |__________________________________________________________________________| 4469 | 3.a.(1)
_____________
(2) Applicable income tax effect | RIAD 4486 | | ////////////////// | 3.a.(2)
_____________ ____________________________
b. (1) | TEXT 4487 |__________________________________________________________________________| 4487 | 3.b.(1)
_____________
(2) Applicable income tax effect | RIAD 4488 | | ////////////////// | 3.b.(2)
_____________ ____________________________
c. (1) | TEXT 4489 |__________________________________________________________________________| 4489 | 3.c.(1)
_____________
(2) Applicable income tax effect | RIAD 4491 | | ////////////////// | 3.c.(2)
____________________________
4. Equity capital adjustments from amended Reports of Income (from Schedule RI-A, | ////////////////// |
item 2) (itemize and describe all adjustments): | ////////////////// |
_____________
a. | TEXT 4492 |______________________________________________________________________________| 4492 | 4.a.
___________
b. | TEXT 4493 |______________________________________________________________________________| 4493 | 4.b.
_____________
5. Cumulative effect of changes in accounting principles from prior years (from | ////////////////// |
Schedule RI-A, item 9) (itemize and describe all changes in accounting principles): | ////////////////// |
_____________
a. | TEXT 4494 |______________________________________________________________________________| 4494 | 5.a.
___________
b. | TEXT 4495 |______________________________________________________________________________| 4495 | 5.b.
_____________
6. Corrections of material accounting errors from prior years (from Schedule RI-A, | ////////////////// |
item 10) (itemize and describe all corrections): | ////////////////// |
_____________
a. | TEXT 4496 | 4496 | 6.a.
___________|______________________________________________________________________________
b. | TEXT 4497 4497 | 6.b.
____________|____________________________________________________________________________________________________
</TABLE>
9
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: Fleet National Bank Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: One Monarch Place Page RI-8
City, State Zip: Springfield, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RI-E--Continued
________________
| Year-to-date |
______ ______________
Dollar Amounts in Thousands | RIAD Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <C> <C>
7. Other transactions with parent holding company (from Schedule RI-A, item 13) | ////////////////// |
(itemize and describe all such transactions): | ////////////////// |
_____________
a. | TEXT 4498 | Fleet National Bank Surplus Distribution to FFG | 4498 (1,003,722) | 7.a.
__________________________________________________________________________________________| |
b. | TEXT 4499 | | 4499 | 7.b.
___________________________________________________________________________________________
8. Adjustments to allowance for loan and lease losses (from Schedule RI-B, part II, | ////////////////// |
item 5) (itemize and describe all adjustments): | ////////////////// |
_____________ | |
a. | TEXT 4521 | 12/31/95 Ending Balance of Pooled Entities | 4521 | 8.a.
___________________________________________________________________________________________| |
b. | TEXT 4522 | | 4522 | 8.b.
___________________________________________________________________________________________| |
____________________
9. Other explanations (the space below is provided for the bank to briefly describe, | I498 | I499 | <-
______________________
at its option, any other significant items affecting the Report of Income):
___
No comment |X| (RIAD 4769)
___
Other explanations (please type or print clearly):
(TEXT 4769)
</TABLE>
10
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: Fleet National Bank Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: One Monarch Place Page RC-1
City, State Zip: Springfield, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for June 30, 1996
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
report the amount outstanding as of the last business day of the quarter.
Schedule RC--Balance Sheet
__________
| C400 | <-
____________ ________
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <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 4,130,928 | 1.a.
b. Interest-bearing balances(2) ............................................................ | 0071 46,521 | 1.b.
2. Securities: | ////////////////// |
a. Held-to-maturity securities (from Schedule RC-B, column A) .............................. | 1754 257,441 | 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) ............................ | 1773 7,250,067 | 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 17,428 | 3.a.
b. Securities purchased under agreements to resell ......................................... | 0277 0 | 3.b.
4. Loans and lease financing receivables: ____________________________| ////////////////// |
a. Loans and leases, net of unearned income (from Schedule RC-C) | RCFD 2122 | 31,278,251 | ////////////////// | 4.a.
b. LESS: Allowance for loan and lease losses ................... | RCFD 3123 | 872,451 | ////////////////// | 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 30,405,800 | 4.d.
5. Trading assets (from schedule RC-D )........................................................ | 3545 71,354 | 5.
6. Premises and fixed assets (including capitalized leases) ................................... | 2145 534,844 | 6.
7. Other real estate owned (from Schedule RC-M) ............................................... | 2150 34,546 | 7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) ... | 2130 0 | 8.
9. Customers' liability to this bank on acceptances outstanding ............................... | 2155 16,634 | 9.
10. Intangible assets (from Schedule RC-M) ..................................................... | 2143 2,283,414 | 10.
11. Other assets (from Schedule RC-F) .......................................................... | 2160 3,978,638 | 11.
12. Total assets (sum of items 1 through 11) ................................................... | 2170 49,027,615 | 12.
______________________
</TABLE>
____________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
11
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-2
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC--Continued
___________________________
Dollar Amounts in Thousands | ///////// Bil Mil Thou |
_______________________________________________________________________________________________ _________________________
<S> <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 34,110,580 | 13.a.
____________________________
(1) Noninterest-bearing(1) ................................ | RCON 6631 10,202,036 | /////////////////////// | 13.a.(1)
(2) Interest-bearing ...................................... | RCON 6636 23,908,544 | /////////////////////// | 13.a.(2)
____________________________
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E, | /////////////////////// |
part II) .............................................................................. | RCFN 2200 1,745,663 | 13.b.
____________________________
(1) Noninterest-bearing ................................... | RCFN 6631 400 | /////////////////////// | 13.b.(1)
(2) Interest-bearing ...................................... | RCFN 6636 1,745,263 | /////////////////////// | 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 4,302,800 | 14.a.
b. Securities sold under agreements to repurchase ........................................ | RCFD 0279 566,036 | 14.b.
15. a. Demand notes issued to the U.S. Treasury .............................................. | RCON 2840 14,411 | 15.a.
b. Trading liabilities (from Schedule RC-D) .............................................. | RCFD 3548 57,446 | 15.b.
16. Other borrowed money: | /////////////////////// |
a. With a remaining maturity of one year or less.......................................... | RCFD 2332 487,435 | 16.a.
b. With a remaining maturity of more than one year........................................ | RCFD 2333 893,259 | 16.b.
17. Mortgage indebtedness and obligations under capitalized leases ........................... | RCFD 2910 11,561 | 17.
18. Bank's liability on acceptances executed and outstanding ................................. | RCFD 2920 16,634 | 18.
19. Subordinated notes and debentures ........................................................ | RCFD 3200 1,213,219 | 19.
20. Other liabilities (from Schedule RC-G) ................................................... | RCFD 2930 1,251,452 | 20.
21. Total liabilities (sum of items 13 through 20) ........................................... | RCFD 2948 44,670,496 | 21.
| /////////////////////// |
22. Limited-life preferred stock and related surplus ......................................... | RCFD 3282 0 | 22.
EQUITY CAPITAL | /////////////////////// |
23. Perpetual preferred stock and related surplus ............................................ | RCFD 3838 125,000 | 23.
24. Common stock ............................................................................. | RCFD 3230 19,487 | 24.
25. Surplus (exclude all surplus related to preferred stock).................................. | RCFD 3839 2,551,927 | 25.
26. a. Undivided profits and capital reserves ................................................ | RCFD 3632 1,693,408 | 26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities ................ | RCFD 8434 (32,703)| 26.b.
27. Cumulative foreign currency translation adjustments ...................................... | RCFD 3284 0 | 27.
28. Total equity capital (sum of items 23 through 27) ........................................ | RCFD 3210 4,357,119 | 28.
29. Total liabilities, limited-life preferred stock, and equity capital (sum of items 21, 22, | /////////////////////// |
and 28) .................................................................................. | RCFD 3300 49,027,615 | 29.
___________________________
</TABLE>
<TABLE>
<CAPTION>
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 Number
most comprehensive level of auditing work performed for the bank by independent external __________________
auditors as of any date during 1995 ............................................................... | RCFD 6724 N/A | M.1.
__________________
<S> <C>
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
____________
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
12
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-3
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-A--Cash and Balances Due From Depository Institutions
Exclude assets held for trading.
__________
| C405 | <-
_________________________________ ________
| (Column A) | (Column B) |
| Consolidated | Domestic |
| Bank | Offices |
____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCON Bil Mil Thou |
_____________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
1. Cash items in process of collection, unposted debits, and currency and | ////////////////// | ////////////////// |
coin .................................................................... | 0022 3,402,522 | ////////////////// | 1.
a. Cash items in process of collection and unposted debits .............. | ////////////////// | 0020 2,655,163 | 1.a.
b. Currency and coin .................................................... | ////////////////// | 0080 747,539 | 1.b.
2. Balances due from depository institutions in the U.S. ................... | ////////////////// | 0082 500,301 | 2.
a. U.S. branches and agencies of foreign banks (including their IBFs) ... | 0083 0 | ////////////////// | 2.a.
b. Other commercial banks in the U.S. and other depository institutions | ////////////////// | ////////////////// |
in the U.S. (including their IBFs) ................................... | 0085 500,373 | ////////////////// | 2.b.
3. Balances due from banks in foreign countries and foreign central banks .. | ////////////////// | 0070 7,902 | 3.
a. Foreign branches of other U.S. banks ................................. | 0073 690 | ////////////////// | 3.a.
b. Other banks in foreign countries and foreign central banks ........... | 0074 7,948 | ////////////////// | 3.b.
4. Balances due from Federal Reserve Banks ................................. | 0090 265,916 | 0090 0 | 4.
5. Total (sum of items 1 through 4) (total of column A must equal | ////////////////// | ////////////////// |
Schedule RC, sum of items 1.a and 1.b) .................................. | 0010 4,177,449 | 0010 4,176,641 | 5.
___________________________________________
<CAPTION>
______________________
Memorandum Dollar Amounts in Thousands | RCON Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Noninterest-bearing balances due from commercial banks in the U.S. (included in item 2, | ////////////////// |
column B above) .............................................................................. | 0050 453,780 | M.1.
______________________
</TABLE>
Schedule RC-B--Securities
Exclude assets held for trading.
<TABLE>
<CAPTION>
_______
| C410 | <-
___________________________________________________________________________ ________
| Held-to-maturity | Available-for-sale |
_________________________________________ _________________________________________
| (Column A) | (Column B) | (Column C) | (Column D) |
| Amortized Cost | Fair Value | Amortized Cost | Fair Value(1) |
____________________ ____________________ ____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
______________________________________ ____________________ ____________________ ____________________ ____________________
<S> <C> <C> <C> <C> <C>
1. U.S. Treasury securities ......... | 0211 250 | 0213 250 | 1286 1,274,624 | 1287 1,252,546 | 1.
2. U.S. Government agency | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
and corporation obligations | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
(exclude mortgage-backed | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
securities): | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
a. Issued by U.S. Govern- | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
ment agencies(2) .............. | 1289 0 | 1290 0 | 1291 0 | 1293 0 | 2.a.
b. Issued by U.S. | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
Government-sponsored | ////////////////// | ////////////////// | ////////////////// | ////////////////// |
agencies(3) ................... | 1294 0 | 1295 0 | 1297 498 | 1298 505 | 2.b.
_____________________________________________________________________________________
</TABLE>
_____________
(1) Includes equity securities without readily determinable fair values at
historical cost in item 6.c, column D.
(2) Includes Small Business Administration "Guaranteed Loan Pool Certificates,"
U.S. Maritime Administration obligations, and Export-Import Bank
participation certificates.
(3) Includes obligations (other than mortgage-backed securities) issued by the
Farm Credit System, the Federal Home Loan Bank System, the Federal Home
Loan Mortgage Corporation, the Federal National Mortgage Association, the
Financing Corporation, Resolution Funding Corporation, the Student Loan
Marketing Association, and the Tennessee Valley Authority.
13
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-4
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-B--Continued
_____________________________________________________________________________________
| Held-to-maturity | Available-for-sale |
_________________________________________ _________________________________________
| (Column A) | (Column B) | (Column C) | (Column D) |
| Amortized Cost | Fair Value | Amortized Cost | Fair Value(1) |
____________________ ____________________ ____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
____________________________________ ____________________ ____________________ ____________________ ____________________
<S> <C> <C> <C> <C>
3. Securities issued by states | ////////////////// |/ //////////////// | ////////////////// | ///////////////// |
and political subdivisions | ////////////////// |////////////////// | ////////////////// | ///////////////// |
in the U.S.: | ////////////////// |////////////////// | ////////////////// | ///////////////// |
a. General obligations ......... | 1676 150,357 |1677 150,242 | 1678 0 | 1679 0 | 3.a.
b. Revenue obligations ......... | 1681 8,887 |1686 8,889 | 1690 0 | 1691 0 | 3.b.
c. Industrial development | ////////////////// |////////////////// | ////////////////// | ///////////////// |
and similiar obligations .....| 1694 0 |1695 0 | 1696 0 | 1697 0 | 3.c.
4. Mortgage-backed | ////////////////// |////////////////// | ////////////////// | ///////////////// |
securities (MBS): | ////////////////// |////////////////// | ////////////////// | ///////////////// |
a. Pass-through securities: | ////////////////// |////////////////// | ////////////////// | ///////////////// |
(1) Guaranteed by | ////////////////// |////////////////// | ////////////////// | ///////////////// |
GNMA ....................... | 1698 0 |1699 0 | 1701 861,176 | 1702 852,929 | 4.a.(1)
(2) Issued by FNMA | ////////////////// |////////////////// | ////////////////// | ///////////////// |
and FHLMC ................. | 1703 908 |1705 908 | 1706 4,854,605 | 1707 4,831,023 | 4.a.(2)
(3) Other pass-through | ////////////////// |////////////////// | ///////////////////| ///////////////// |
secruities ................. | 1709 4 |1710 4 | 1711 0 | 1713 0 | 4.a.(3)
b. Other mortgage-backed | ////////////////// |////////////////// | ////////////////// | ///////////////// |
securities (include CMO's, | ////////////////// |////////////////// | ////////////////// | ///////////////// |
REMICs, and stripped | ////////////////// |////////////////// | ////////////////// | ///////////////// |
MBS): | ////////////////// |////////////////// | ////////////////// | ///////////////// |
(1) Issued or guaranteed | ////////////////// |////////////////// | ////////////////// | ///////////////// |
by FNMA, FHLMC, | ////////////////// |////////////////// | ////////////////// | ///////////////// |
or GNMA ............... | 1714 0 |1715 0 | 1716 0 | 1717 0 | 4.b.(1)
(2) Collateralized | ////////////////// |////////////////// | ////////////////// | ///////////////// |
by MBS issued or | ////////////////// |////////////////// | ////////////////// | ///////////////// |
guaranteed by FNMA, | ////////////////// |////////////////// | ////////////////// | ///////////////// |
FHLMC, or GNMA ........ | 1718 0 |1719 0 | 1731 0 | 1732 0 | 4.b.(2)
(3) All other mortgage- | ////////////////// |////////////////// | ////////////////// | //////////////// |
backed securities ..... | 1733 0 |1734 0 | 1735 518 | 1736 518 | 4.b.(3)
5. Other debt securities: | ////////////////// |////////////////// | ////////////////// | ///////////////// |
a. Other domestic debt | ////////////////// |////////////////// | ////////////////// | ///////////////// |
securities.................. | 1737 0 |1738 0 | 1739 817 | 1741 812 | 5.a.
b. Foreign debt | ////////////////// |////////////////// | ////////////////// | ///////////////// |
securities ................. | 1742 97,035 |1743 78,878 | 1744 0 | 1746 0 | 5.b.
6. Equity securities: | ////////////////// |////////////////// | ////////////////// | ///////////////// |
a. Investments in mutual | ////////////////// |////////////////// | ////////////////// | ///////////////// |
funds ...................... | ////////////////// |////////////////// | 1747 0 | 1748 0 | 6.a.
b. Other equity securities | ////////////////// |////////////////// | ////////////////// | ///////////////// |
with readily determin- | ////////////////// |////////////////// | ////////////////// | ///////////////// |
able fair values ........... | ////////////////// |////////////////// | 1749 0 | 1751 0 | 6.b.
c. All other equity | ////////////////// |////////////////// | ////////////////// | ///////////////// |
securities (1) ............. | ////////////////// |////////////////// | 1752 311,734 | 1753 311,734 | 6.c.
7. Total (sum of items 1 | ////////////////// |////////////////// | ////////////////// | ///////////////// |
through 6) (total of | ////////////////// |////////////////// | ////////////////// | ///////////////// |
column A must equal | ////////////////// |////////////////// | ////////////////// | ///////////////// |
Schedule RC, item 2.a) | ////////////////// |////////////////// | ////////////////// | ///////////////// |
(total of column D must | ////////////////// |////////////////// | ////////////////// | ///////////////// |
equal Schedule RC, | ////////////////// |////////////////// | ////////////////// | ///////////////// |
item 2.b) ..................... | 1754 257,441 | 1771 239,171 | 1772 7,303,972 | 1773 7,250,067 | 7.
|__________________________________________________________________________________|
</TABLE>
____________
1) Includes equity securities without readily determinable fair values at
historical cost in item 6.c, column D.
14
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-5
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-B--Continued
<CAPTION>
___________
Memoranda | C412 | <-
___________ _________
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Pledged securities(2) ......................................................................... | 0416 2,308,912 | M.1.
2. Maturity and repricing data for debt securities(2),(3),(4) (excluding those in | ////////////////// |
nonaccrual status): | ////////////////// |
a. Fixed rate debt securities with a remaining maturity of: | ////////////////// |
(1) Three months or less ................................................................... | 0343 72,490 | M.2.a.(1)
(2) Over three months through 12 months .................................................... | 0344 77,125 | M.2.a.(2)
(3) Over one year through five years ....................................................... | 0345 2,734,577 | M.2.a.(3)
(4) Over five years ........................................................................ | 0346 2,925,207 | M.2.a.(4)
(5) Total fixed rate debt securities (sum of Memorandum items 2.a.(1) through 2.a.(4)) ..... | 0347 5,809,399 | M.2.a.(5)
b. Floating rate debt securities with a repricing frequency of: | ////////////////// |
(1) Quarterly or more frequently ........................................................... | 4544 531,365 | M.2.b.(1)
(2) Annually or more frequently, but less frequently than quarterly ........................ | 4545 855,010 | M.2.b.(2)
(3) Every five years or more frequently, but less frequently than annually ................. | 4551 0 | M.2.b.(3)
(4) Less frequently than every five years .................................................. | 4552 0 | M.2.b.(4)
(5) Total floating rate debt securities (sum of Memorandum items 2.b.(1) through 2.b.(4)) .. | 4553 1,386,375 | M.2.b.(5)
c. Total debt securities (sum of Memorandum items 2.a.(5) and 2.b.(5)) (must equal total debt | ////////////////// |
securities from Schedule RC-B, sum of items 1 through 5, columns A and D, minus nonaccrual | ////////////////// |
debt securities included in Schedule RC-N, item 9, column C) ............................... | 0393 7,195,774 | M.2.c.
3. Not applicable | ////////////////// |
4. Held-to-maturity debt securities restructured and in compliance with modified terms (included | ////////////////// |
in Schedule RC-B, items 3 through 5, column A, above) ......................................... | 5365 0 | M.4.
5. Not applicable | ////////////////// |
6. Floating rate debt securities with a remaining maturity of one year or less(2),(4) (included in | ////////////////// |
Memorandum items 2.b(1) through 2.b.(4) above)................................................. | 5519 3,700 | M.6.
7. Amortized cost of held-to-maturity securities sold or transferred to available-for-sale or | ////////////////// |
trading securities during the calendar year-to-date (report the amortized cost at date of sale | ////////////////// |
or transfer ................................................................................... | 1778 0 | m.7.
8. High-risk mortgage securities (included in the held-to-maturity and available-for-sale | ////////////////// |
accounts in Schedule RC-B, item 4.b): | ////////////////// |
a. Amortized cost ............................................................................. | 8780 0 | M.8.a.
b. Fair Value ................................................................................. | 8781 0 | M.8.b.
9. Structured notes (included in the held-to-maturity and available-for-sale accounts in | ////////////////// |
Schedule RC-B, items 2, 3, and 5): | ////////////////// |
a. Amortized cost ............................................................................. | 8782 0 | M.9.a.
b. Fair Value ................................................................................. | 8783 0 | M.9.b.
----------------------
</TABLE>
____________
(2) Includes held-to-maturity securities at amortized cost and
available-for-sale securities at fair value.
(3) Exclude equity securities, e.g., investments in mutual funds, Federal
Reserve stock, common stock, and preferred stock.
(4) Memorandum items 2 and 6 are not applicable to savings banks that must
complete supplemental Schedule RC-J.
15
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-6
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
Schedule RC-C--Loans and Lease Financing Receivables
Part I. Loans and Leases
_________
Do not deduct the allowance for loan and lease losses from amounts | C415 | <-
reported in this schedule. Report total loans and leases, net of unearned _________________________________|________|
income. Exclude assets held for trading. | (Column A) | (Column B) |
| Consolidated | Domestic |
| Bank | Offices |
____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCON Bil Mil Thou |
_____________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
1. Loans secured by real estate ........................................... | 1410 11,754,916 | ////////////////// | 1.
a. Construction and land development ................................... | ////////////////// | 1415 433,880 | 1.a.
b. Secured by farmland (including farm residential and other | ////////////////// | ////////////////// |
improvements) ....................................................... | ////////////////// | 1420 2,172 | 1.b
c. Secured by 1-4 family residential properties: | ////////////////// | ////////////////// |
(1) Revolving, open-end loans secured by 1-4 family residential | ////////////////// | ////////////////// |
properties and extended under lines of credit ................... | ////////////////// | 1797 2,022,596 | 1.c.(1)
(2) All other loans secured by 1-4 family residential properties: | ////////////////// | ////////////////// |
(a) Secured by first liens ...................................... | ////////////////// | 5367 4,418,239 | 1.c.(2)(a)
(b) Secured by junior liens ..................................... | ////////////////// | 5368 492,952 | 1.c.(2)(b)
d. Secured by multifamily (5 or more) residential properties ........... | ////////////////// | 1460 559,373 | 1.d.
e. Secured by nonfarm nonresidential properties ........................ | ////////////////// | 1480 3,825,704 | 1.e.
2. Loans to depository institutions: | ////////////////// | ////////////////// |
a. To commercial banks in the U.S. ..................................... | ////////////////// | 1505 143,682 | 2.a.
(1) To U.S. branches and agencies of foreign banks .................. | 1506 0 | ////////////////// | 2.a.(1)
(2) To other commercial banks in the U.S. ........................... | 1507 143,682 | ////////////////// | 2.a.(2)
b. To other depository institutions in the U.S. ........................ | 1517 0 | 1517 12,345 | 2.b.
c. To banks in foreign countries ....................................... | ////////////////// | 1510 672 | 2.c.
(1) To foreign branches of other U.S. banks ......................... | 1513 149 | ////////////////// | 2.c.(1)
(2) To other banks in foreign countries ............................. | 1516 523 | ////////////////// | 2.c.(2)
3. Loans to finance agricultural production and other loans to farmers .... | 1590 5,889 | 1590 5,889 | 3.
4. Commercial and industrial loans: | ////////////////// | ////////////////// |
a. To U.S. addressees (domicile) ....................................... | 1763 12,446,547 | 1763 12,402,858 | 4.a.
b. To non-U.S. addressees (domicile) ................................... | 1764 83,521 | 1764 54,074 | 4.b.
5. Acceptances of other banks: | ////////////////// | ////////////////// |
a. Of U.S. banks ....................................................... | 1756 0 | 1756 0 | 5.a.
b. Of foreign banks .................................................... | 1757 0 | 1757 0 | 5.b.
6. Loans to individuals for household, family, and other personal | ////////////////// | ////////////////// |
expenditures (i.e., consumer loans) (includes purchased paper) ......... | ////////////////// | 1975 2,217,352 | 6.
a. Credit cards and related plans (includes check credit and other | ////////////////// | ////////////////// |
revolving credit plans) ............................................. | 2008 161,652 | ////////////////// | 6.a.
b. Other (includes single payment, installment, and all student loans).. | 2011 2,055,700 | ////////////////// | 6.b.
7. Loans to foreign governments and official institutions (including | ////////////////// | ////////////////// |
foreign central banks) ................................................. | 2081 0 | 2081 0 | 7.
8. Obligations (other than securities and leases) of states and political | ////////////////// | ////////////////// |
subdivisions in the U.S. (includes nonrated industrial development | ////////////////// | ////////////////// |
obligations) ........................................................... | 2107 167,100 | 2107 167,100 | 8.
9. Other loans ............................................................ | 1563 2,146,172 | ////////////////// | 9.
a. Loans for purchasing or carrying securities (secured and unsecured).. | ////////////////// | 1545 156,275 | 9.a.
b. All other loans (exclude consumer loans) ............................ | ////////////////// | 1564 1,989,897 | 9.b.
10. Lease financing receivables (net of unearned income) ................... | ////////////////// | 2165 2,300,055 | 10.
a. Of U.S. addressees (domicile) ....................................... | 2182 2,300,055 | ////////////////// | 10.a.
b. Of non-U.S. addressees (domicile) ................................... | 2183 0 | ////////////////// | 10.b.
11. LESS: Any unearned income on loans reflected in items 1-9 above ........ | 2123 0 | 2123 0 | 11.
12. Total loans and leases, net of unearned income (sum of items 1 through | ////////////////// | ////////////////// |
10 minus item 11) (total of column A must equal Schedule RC, item 4.a).. | 2122 31,278,251 | 2122 31,205,115 | 12.
___________________________________________
</TABLE>
16
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page: RC-7
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-C--Continued
Part I. Continued
___________________________________________
| (Column A) | (Column B) |
| Consolidated | Domestic |
Memoranda | Bank | Offices |
____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCON Bil Mil Thou |
_____________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
1. Commercial paper included in Schedule RC-C, part I, above .............. | 1496 0 | 1496 0 | M.1.
2. Loans and leases restructured and in compliance with modified terms | ////////////////// | ////////////////// |
(included in Schedule RC-C, part I, above and not reported as past due | ////////////////// | ////////////////// |
or nonaccrual in Schedule RC-N, Memorandum item 1): | ////////////////// | ////////////////// |
a. Loans secured by real estate: | ////////////////// | ////////////////// |
(1) To U.S. addressees (domicile) ................................... | 1687 511 | M.2.a.(1)
(2) To non-U.S. addressees (domicile) ............................... | 1689 0 | M.2.a.(2)
b. All other loans and all lease financing receivables (exclude loans | ////////////////// |
to individuals for household, family, and other personal expenditures)| 8691 0 | M.2.b.
c. Commercial and industrial loans to and lease financing receivables | ////////////////// |
of non-U.S. addressees (domicile) included in Memorandum item 2.b | ////////////////// |
above ............................................................... | 8692 0 | M.2.c.
3. Maturity and repricing data for loans and leases(1) (excluding those | ////////////////// |
in nonaccrual status): | ////////////////// |
a. Fixed rate loans and leases with a remaining maturity of: | ////////////////// |
(1) Three months or less ............................................ | 0348 10,215,575 | M.3.a.(1)
(2) Over three months through 12 months ............................. | 0349 369,421 | M.3.a.(2)
(3) Over one year through five years ................................ | 0356 3,479,742 | M.3.a.(3)
(4) Over five years ................................................. | 0357 5,791,166 | M.3.a.(4)
(5) Total fixed rate loans and leases (sum of | ////////////////// |
Memorandum items 3.a.(1) through 3.a.(4)) ....................... | 0358 19,855,904 | M.3.a.(5)
b. Floating rate loans with a repricing frequency of: | ////////////////// |
(1) Quarterly or more frequently .................................... | 4554 8,960,876 | M.3.b.(1)
(2) Annually or more frequently, but less frequently than quarterly . | 4555 1,848,295 | M.3.b.(2)
(3) Every five years or more frequently, but less frequently than | ////////////////// |
annually ........................................................ | 4561 250,031 | M.3.b.(3)
(4) Less frequently than every five years ........................... | 4564 12,721 | M.3.b.(4)
(5) Total floating rate loans (sum of Memorandum items 3.b.(1) | ////////////////// |
through 3.b.(4)) ................................................ | 4567 11,071,923 | M.3.b.(5)
c. Total loans and leases (sum of Memorandum items 3.a.(5) and 3.b.(5)) | ////////////////// |
(must equal the sum of total loans and leases, net, from | ////////////////// |
Schedule RC-C, part I, item 12, plus unearned income from | ////////////////// |
Schedule RC-C, part I, item 11, minus total nonaccrual loans and | ////////////////// |
leases from Schedule RC-N, sum of items 1 through 8, column C) ...... | 1479 30,927,827 | M.3.c.
d. FLOATING RATE LOANS WITH A REMAINING MATURITY OF ONE YEAR OR LESS | ////////////////// |
(INCLUDED IN MEMORANDUM ITEMS 3.b.(1) THROUGH 3.b.(4) ABOVE)......... | A246 1,543,411 | M.3.d.
4. Loans to finance commercial real estate, construction, and land | ////////////////// |
development activities (NOT SECURED BY REAL ESTATE) included in | ////////////////// |
Schedule RC-C, part I, items 4 and 9, column A, page RC-6(2) ........... | 2746 271,706 | M.4.
5. Loans and leases held for sale (included in Schedule RC-C, part I, | ////////////////// |
above .................................................................. | 5369 0 | M.5.
| ////////////////// |_____________________
6. Adjustable rate closed-end loans secured by first liens on 1-4 family | ////////////////// | RCON Bil Mil Thou |
residential properties (included in Schedule RC-C, part I, item | ////////////////// | ___________________|
1.c.(2)(a), column B, page RC-6) ....................................... | ////////////////// | 5370 1.655.898 | M.6.
|_________________________________________|
</TABLE>
_____________________________
(1) Memorandum item 3 is not applicable to savings banks that must complete
supplememtal Schedule RC-J.
(2) Exclude loans secured by real estate that are included in Schedule RC-C,
part I, item 1, column A.
17
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-7a
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<S> <C>
Schedule RC-C--Continued
Part II. Loans to Small Businesses and Small Farms
Schedule RC-C, Part II is to be reported only with the June Report of Condition.
Report the number and amount currently outstanding as of June 30 of business loans with "original amounts" of $1,000,000 or less
and farm loans with "original amounts" of $500,000 or less. The following guidelines should be used to determine the "original
amount" of a loan: (1) For loans drawn down under lines of credit or loan commitments, the "original amount" of the loan is the
size of the line of credit or loan commitment when the line of credit or loan commitment was most recently approved, extended, or
renewed prior to the report date. However, if the amount currently outstanding as of the report date exceeds this size, the
"original amount" is the amount currently outstanding on the report date. (2) For loan participations and syndications, the
"original amount" of the loan participation or syndication is the entire amount of the credit originated by the lead lender.
(3) For all other loans, the "original amount" is the total amount of the loan at origination or the amount currently
outstanding as of the report date, whichever is larger.
Loans to Small Businesses
</TABLE>
<TABLE>
<S> <C>
1. Indicate in the appropriate box at the right whether all or substantially all of the dollar volume of your
bank's "Loans secured by nonfarm nonresidential properties" in domestic offices reported in Schedule RC-C,
part I, item 1.e, column B, and all or substantially all of the dollar volume of your bank's
"Commercial and industrial loans to U.S. addressees" in domestic offices reported in Schedule RC-C, __________
part I, item 4.a, column B, have original amounts of $100,000 or less (If your bank has no loans ________| C415 | <-
outstanding in both of these two loan categories, place an "X" in the box marked "NO" and go to | RCON YES NO|
Item 5; otherwise, see instructions for further information.).................................. | 6999 | |///| x | 1.
___________________
If YES, complete items 2.a and 2.b below, skip items 3 and 4, and go to item 5.
If NO and your bank has loans outstanding in either loan category, skip items 2.a and 2.b,
complete items 3 and 4 below, and go to item 5. _____________________
| Number of Loans |
2. Report the total number of loans currently outstanding for each of the |____________________|
following Schedule RC-C, part I, loan categories: | RCON |/////////// |
a. "Loans secured by nonfarm nonresidential properties" in domestic | ////////////////// |
offices reported in Schedule RC-C, part I, item 1.e, column B....... | 5562 N/A | 2.a.
b. "Commercial and industrial loans to U.S. addressees" in domestic | ////////////////// |
offices reported in Schedule RC-C, part I, item 4.a, column B ...... | 5563 N/A | 2.b.
______________________
</TABLE>
<TABLE>
<CAPTION>
___________________________________________
| (Column A) | (Column B) |
| | Amount |
| | Currently |
| Number of Loans | Outstanding |
____________________ ____________________
Dollar Amounts in Thousands | RCON | ///////////| RCON Bil Mil Thou |
_____________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
3. Number and amount currently outstanding of "Loans secured by nonfarm | /////////////////////////////////////// | 1.
nonresidential properties" in domestic offices reported in Schedule RC-C | /////////////////////////////////////// | 1.a.
part I item 1.e, column B (sum of items 3.a through 3.c must be less | /////////////////////////////////////// |
or equal to Schedule RC-C, part I, item 1.e, column B): | /////////////////////////////////////// | 1.b
a. With original amounts of $100,000 or less ........................... | 5564 1,988 | 5565 76,370 | 3.a.
b. With original amounts of more than $100,000 through $250,000 ........ | 5566 2,805 | 5567 332,639 | 3.b.
c. With original amounts of more than $250,000 through $1,000,000 ...... | 5568 2,736 | 5569 952,476 | 3.c.
4. Number and amount currently outstanding of "Commercial and industrial | /////////////////////////////////////// |
loans to U.S. addressees" in domestic offices reported in Schedule RC-C, | /////////////////////////////////////// |
part I, item 4.a, column B (sum of items 4.a through 4.c must be less | /////////////////////////////////////// |
than or equal to Schedule RC-C, part I, item 4.a, column B): | /////////////////////////////////////// |
a. With original amounts of $100,000 or less ........................... | 5570 11,433 | 5571 337,759 | 4.a.
b. With original amounts of more than $100,000 through $250,000 ........ | 5572 2,127 | 5573 228,713 | 4.b.
c. With original amounts of more than $250,000 through $1,000,000 ...... | 5574 1,968 | 5575 601,126 | 4.c.
___________________________________________
</TABLE>
17a
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-7b
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
Schedule RC-C -- Continued
Part II. Continued
Agricultural Loans to Small Farms
<TABLE>
<S> <C> <C>
5. Indicate in the appropriate box at the right whether all or substantially all of the
dollar volume of your bank's "Loans secured by farmland (including farm residential
and other improvements)" in domestic offices reported in Schedule RC-C, part I, item
1.b, column B, and all or substantially all of the dollar volume of your bank's
"Loans to finance agricultural production and other loans to farmers" in domestic
offices reported in Schedule RC-C, part I, item 3, column B, have original amounts
of $100,000 or less (If your bank has no loans outstanding in both of these two YES NO
loan categories, place an "X" in the box marked "NO" and do not complete items 7 _______________________
and 8; otherwise, see instructions for further information.)................................... | 6860 | | /// | X | 5.
|_____________________|
If YES, complete items 6.a and 6.b below and do not complete items 7 and 8.
If NO and your bank has loans outstanding in either loan category, skip items 6.a and 6.b
and complete items 7 and 8 below.
</TABLE>
<TABLE>
<S> <C>
______________________
| Number of Loans |
6. Report the total number of loans currently outstanding for each of the |____________________|
following Schedule RC-C, part I, loan categories: | RCON |//////////// |
a. "Loans secured by farmland (including farm residential and other |______| |
improvements)" in domestic offices reported in Schedule RC-C, part I, | ////////////////// |
item 1.b, column B........................................................ | 5576 N/A | 6.a.
b. "Loans to finance agricultural production and other loans to farmers" in | ////////////////// |
domestic offices reported in Schedule RC-C, part I, item 3, column B...... | 5577 N/A | 6.b.
|____________________|
</TABLE>
<TABLE>
<S> <C> <C>
_____________________________________________
| (Column A) | (Column B) |
| | Amount |
| | Currently |
| Number of Loans | Outstanding |
|_____________________|______________________|
Dollar Amounts in Thousands | RCON |/////////////| RCON Bil Mil Thou |
________________________________________________________________________________| ______| |_____________________ |
7. Number and amount currently outstanding of "Loans secured by farmland | ////////////////////////////////////////// |
(including farm residential and other improvements)" in domestic offices | ////////////////////////////////////////// |
reported in Schedule RC-C, part I, item 1.b, column B (sum of items 7.a | ////////////////////////////////////////// |
through 7.c must be less than or equal to Schedule RC-C, part I, item 1.b, | ////////////////////////////////////////// |
column B): | ////////////////////////////////////////// |
a. With original amounts of $100,000 or less............................... | 5578 18 | 5579 292 | 7.a.
b. With original amounts of more than $100,000 through $250,000............ | 5580 8 | 5581 850 | 7.b.
c. With original amounts of more than $250,000 through $500,000............ | 5582 4 | 5583 1,030 | 7.c.
8. Number and amount currently outstanding of "Loans to finance agricultural | ////////////////////////////////////////// |
production and other loans to farmers" in domestic offices reported in | ////////////////////////////////////////// |
Schedule RC-C, part I, item 3, column B (sum of items 8.a through 8.c | ////////////////////////////////////////// |
must be less than or equal to Schedule RC-C, part I, item 3, column B): | ////////////////////////////////////////// |
a. With original amounts of $100,000 or less............................... | 5584 46 | 5585 992 | 8.a.
b. With original amounts of more than $100,000 through $250,000............ | 5586 17 | 5587 1,877 | 8.b.
c. With original amounts of more than $250,000 through $500,000............ | 5588 4 | 5589 1,054 | 8.c.
|_____________________|______________________|
</TABLE>
17b
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-8
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
Schedule RC-D--Trading Assets and Liabilities
Schedule RC-D is to be completed only by banks with $1 billion or more in total assets or with $2 billion or more in par/notional
amount of off-balance sheet derivative contracts (as reported in Schedule RC-L, items 14.a through 14.e, columns A through D).
__________
| C420 |
__________________________
Dollar Amounts in Thousands | ////////// Bil Mil Thou|
__________________________________________________________________________________________________| ________________________|
<S> <C> <C>
ASSETS | /////////////////////// |
1. U.S. Treasury securities in domestic offices ................................................ | RCON 3531 0 | 1.
2. U.S. Government agency and corporation obligations in domestic offices (exclude mortgage- | /////////////////////// |
backed securities) .......................................................................... | RCON 3532 0 | 2.
3. Securities issued by states and political subdivisions in the U.S. in domestic offices ...... | RCON 3533 0 | 3.
4. Mortgage-backed securities (MBS) in domestic offices: | /////////////////////// |
a. Pass-through securities issued or guaranteed by FNMA, FHLMC, or GNMA ..................... | RCON 3534 0 | 4.a.
b. Other mortgage-backed securities issued or guaranteed by FNMA, FHLMC, or GNMA | /////////////////////// |
(include CMOs, REMICs, and stripped MBS) ................................................. | RCON 3535 0 | 4.b.
c. All other mortgage-backed securities ......................................................| RCON 3536 0 | 4.c.
5. Other debt securities in domestic offices ................................................... | RCON 3537 0 | 5.
6. Certificates of deposit in domestic offices ................................................. | RCON 3538 0 | 6.
7. Commercial paper in domestic offices ........................................................ | RCON 3539 0 | 7.
8. Bankers acceptances in domestic offices ..................................................... | RCON 3540 0 | 8.
9. Other trading assets in domestic offices .................................................... | RCON 3541 0 | 9.
10. Trading assets in foreign offices ........................................................... | RCFN 3542 0 | 10.
11. Revaluation gains on interest rate, foreign exchange rate, and other commodity and equity | /////////////////////// |
contracts: | /////////////////////// |
a. In domestic offices ...................................................................... | RCON 3543 66,696 | 11.a.
b. In foreign offices ....................................................................... | RCFN 3544 4,658 | 11.b.
12. Total trading assets (sum of items 1 through 11) (must equal Schedule RC, item 5) ........... | RCFD 3545 71,354 | 12.
<CAPTION>
___________________________
___________________________
| ///////// Bil Mil Thou |
LIABILITIES | ________________________|_
<S> <C> <C>
13. Liability for short positions ............................................................... | RCFD 3546 0 | 13.
14. Revaluation losses on interest rate, foreign exchange rate, and other commodity and equity | /////////////////////// |
contracts ................................................................................... | RCFD 3547 57,446 | 14.
15. Total trading liabilities (sum of items 13 and 14) (must equal Schedule RC, item 15.b) ...... | RCFD 3548 57,446 | 15.
___________________________
</TABLE>
18
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-9
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-E--Deposit Liabilities
Part I. Deposits in Domestic Offices
__________
| C425 | <-
______________________________________________________ ________
| | Nontransaction |
| Transaction Accounts | Accounts |
_________________________________________ ____________________
| (Column A) | (Column B) | (Column C) |
| Total transaction | Memo: Total | Total |
| accounts (including| demand deposits | nontransaction |
| total demand | (included in | accounts |
| deposits) | column A) | (including MMDAs) |
____________________ ____________________ ____________________
Dollar Amounts in Thousands | RCON Bil Mil Thou | RCON Bil Mil Thou | RCON Bil Mil Thou |
__________________________________________________________ ____________________ ____________________ ____________________
<S> <C> <C> <C> <C>
Deposits of: | ////////////////// | ////////////////// | ////////////////// |
1. Individuals, partnerships, and corporations .......... | 2201 8,615,650 | 2240 8,158,203 | 2346 22,594,478 | 1.
2. U.S. Government ...................................... | 2202 58,650 | 2280 58,605 | 2520 42,512 | 2.
3. States and political subdivisions in the U.S. ........ | 2203 818,151 | 2290 706,072 | 2530 702,686 | 3.
4. Commercial banks in the U.S. ......................... | 2206 836,005 | 2310 836,005 | 2550 771 | 4.
5. Other depository institutions in the U.S. ............ | 2207 221,571 | 2312 221,571 | 2349 2,968 | 5.
6. Banks in foreign countries ........................... | 2213 18,445 | 2320 18,445 | 2236 0 | 6.
7. Foreign governments and official institutions | ////////////////// | ////////////////// | ////////////////// |
(including foreign central banks) .................... | 2216 108 | 2300 108 | 2377 0 | 7.
8. Certified and official checks ........................ | 2330 198,585 | 2330 198,585 | ////////////////// | 8.
9. Total (sum of items 1 through 8) (sum of | ////////////////// | ////////////////// | ////////////////// |
columns A and C must equal Schedule RC, | ////////////////// | ////////////////// | ////////////////// |
item 13.a) ........................................... | 2215 10,767,165 | 2210 10,197,594 | 2385 23,343,415 | 9.
________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
______________________
Memoranda Dollar Amounts in Thousands | RCON Bil Mil Thou |
____________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Selected components of total deposits (i.e., sum of item 9, columns A and C): | ////////////////// |
a. Total Individual Retirement Accounts (IRAs) and Keogh Plan accounts ......................... | 6835 2,735,425 | M.1.a.
b. Total brokered deposits ..................................................................... | 2365 1,636,611 | M.1.b.
c. Fully insured brokered deposits (included in Memorandum item 1.b above): | ////////////////// |
(1) Issued in denominations of less than $100,000 ........................................... | 2343 2,350 | M.1.c.(1)
(2) Issued EITHER in denominations of $100,000 OR in denominations greater than $100,000 | ////////////////// |
and participated out by the broker in shares of $100,000 or less ........................ | 2344 1,634,261 | M.1.c.(2)
d. MATURITY DATA FOR BROKERED DEPOSITS: | ////////////////// |
(1) BROKERED DEPOSITS ISSUED IN DENOMINATIONS OF LESS THAN $100,000 WITH A REMAINING | ////////////////// |
MATURITY OF ONE YEAR OR LESS (INCLUDED IN MEMORANDUM ITEM 1.c.(1) ABOVE)................. | A243 171 | M.1.d.(1)
(2) BROKERED DEPOSITS ISSUED IN DENOMINATIONS OF $100,000 OR MORE WITH A REMAINING | ////////////////// |
MATURITY OF ONE YEAR OR LESS (INCLUDED IN MEMORANDUM ITEM 1.b ABOVE)..................... | A244 509,265 | M.1.d.(2)
e. Preferred deposits (uninsured deposits of states and political subdivisions in the U.S. | ////////////////// |
reported in item 3 above which are secured or collateralized as required under state law) ... | 5590 457,587 | M.1.e.
2. Components of total nontransaction accounts (sum of Memoranda items 2.a through 2.d must | ////////////////// |
equal item 9, column C above): | ////////////////// |
a. Savings deposits: | ////////////////// |
(1) Money market deposit accounts (MMDAs) ................................................... | 6810 10,738,339 | M.2.a.(1)
(2) Other savings deposits (excludes MMDAs) ................................................. | 0352 2,655,659 | M.2.a.(2)
b. Total time deposits of less than $100,000 ................................................... | 6648 7,247,099 | M.2.b.
c. Time certificates of deposit of $100,000 or more ............................................ | 6645 2,702,318 | M.2.c.
d. Open-account time deposits of $100,000 or more .............................................. | 6646 0 | M.2.d.
3. All NOW accounts (included in column A above) .................................................. | 2398 569,571 | M.3.
4. Not applicable
______________________
</TABLE>
19
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-10
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
Schedule RC-E--Continued
Part I. Continued
Memoranda (continued)
_________________________________________________________________________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
______________________
Dollar Amounts in Thousands | RCON Bil Mil Thou |
___________________________________________________________________________________________________ ____________________
<S> <C> <C>
5. Maturity and repricing data for time deposits of less than $100,000 (sum of | ////////////////// |
Memorandum items 5.a.(1) through 5.b.(3) must equal Memorandum item 2.b above):(1) | ////////////////// |
a. Fixed rate time deposits of less than $100,000 with a remaining maturity of: | ////////////////// |
(1) Three months or less.................................................................... | A225 1,684,248 | M.5.a.(1)
(2) Over three months through 12 months..................................................... | A226 3,493,722 | M.5.a.(2)
(3) Over one year........................................................................... | A227 2,002,999 | M.5.a.(3)
b. Floating rate time deposits of less than $100,000 with a repricing frequency of: | ////////////////// |
(1) Quarterly or more frequently............................................................ | A228 66,130 | M.5.b.(1)
(2) Annually or more frequently, but less frequently than quarterly......................... | A229 0 | M.5.b.(2)
(3) Less frequently than annually........................................................... | A230 0 | M.5.b.(3)
c. Floating rate time deposits of less than $100,000 with a remaining maturity of | ////////////////// |
one year or less (included in Memorandum items 5.b.(1) through 5.b.(3) above)............... | A231 45,084 | M.5.c.
6. Maturity and repricing data for time deposits of $100,000 or more (i.e., time certificates | ////////////////// |
of deposit of $100,000 or more and open-account time deposits of $100,000 or more) | ////////////////// |
(sum of Memorandum items 6.a.(1) through 6.b.(4) must equal the sum of Memorandum | ////////////////// |
items 2.c and 2.d above):(1) | ////////////////// |
a. Fixed rate time deposits of $100,000 or more with a remaining maturity of: | ////////////////// |
(1) Three months or less ................................................................... | A232 534,657 | M.6.a.(1)
(2) Over three months through 12 months .................................................... | A233 754,429 | M.6.a.(2)
(3) Over one year through five years ....................................................... | A234 1,282,541 | M.6.a.(3)
(4) Over five years ........................................................................ | A235 36,761 | M.6.a.(4)
b. Floating rate time deposits of $100,000 or more with a repricing frequency of: | ////////////////// |
(1) Quarterly or more frequently ........................................................... | A236 31,182 | M.6.b.(1)
(2) Annually or more frequently, but less frequently than quarterly ........................ | A237 37,950 | M.6.b.(2)
(3) Every five years or more frequently, but less frequently than annually ................. | A238 24,798 | M.6.b.(3)
(4) Less frequently than every five years .................................................. | A239 0 | M.6.b.(4)
c. Floating rate time deposits of $100,000 or more with a remaining maturity of | ////////////////// |
one year or less (included in Memorandum items 6.b.(1) through 6.b.(4) above)............... | A240 19,186 | M.6.c.
______________________
</TABLE>
_______________
(1) Memorandum items 5 and 6 are not applicable to savings banks that must
complete supplemental Schedule RC-J.
20
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 6/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-11
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-E--Continued
Part II. Deposits in Foreign Offices (including Edge and
Agreement subsidiaries and IBFs)
______________________
Dollar Amounts in Thousands | RCFN Bil Mil Thou |
___________________________________________________________________________________________________ ____________________
<S> <C> <C>
Deposits of: | ////////////////// |
1. Individuals, partnerships, and corporations ................................................... | 2621 1,730,162 | 1.
2. U.S. banks (including IBFs and foreign branches of U.S. banks) ................................ | 2623 0 | 2.
3. Foreign banks (including U.S. branches and agencies of foreign banks, including their IBFs).... | 2625 0 | 3.
4. Foreign governments and official institutions (including foreign central banks) ............... | 2650 0 | 4.
5. Certified and official checks ................................................................. | 2330 0 | 5.
6. All other deposits ............................................................................ | 2668 15,501 | 6.
7. Total (sum of items 1 through 6) (must equal Schedule RC, item 13.b) .......................... | 2200 1,745,663 | 7.
Memorandum
Dollar Amounts in Thousands |RCFN Bil Mil Thou |
________________________________________________________________________________________________________________________
1. Time deposits with a remaining maturity of one year or less (included in Part II, item 7 above) |A245 1,745,263 | M.1.
______________________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-F--Other Assets
__________
| C430 | <-
_________________ ________
Dollar Amounts in Thousands | ////////// Bil Mil Thou |
__________________________________________________________________________________________________ _________________________
<S> <C> <C>
1. Income earned, not collected on loans ........................................................ | RCFD 2164 167,538 | 1.
2. Net deferred tax assets(1) ................................................................... | RCFD 2148 0 | 2.
3. Excess residential mortgage servicing fees receivable ........................................ | RCFD 5371 134,288 | 3.
4. Other (itemize and describe amounts that exceed 25% of this item)............................. | RCFD 2168 3,676,812 | 4.
_____________ ___________________________
a. | TEXT 3549 | Mortgages held for Resale | RCFD 3549 | 1,858,683 | /////////////////////// | 4.a.
_________________________________________________________________| | | |
___________
b. | TEXT 3550 |____________________________________________________| RCFD 3550 | | /////////////////////// | 4.b.
___________
c. | TEXT 3551 |____________________________________________________| RCFD 3551 | | /////////////////////// | 4.c.
_____________
___________________________
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 11) ........................... | RCFD 2160 3,978,638 | 5.
___________________________
<CAPTION>
Memorandum ___________________________
Dollar Amounts in Thousands | ////////// Bil Mil Thou |
__________________________________________________________________________________________________ _________________________
<S> <C> <C>
1. Deferred tax assets disallowed for regulatory capital purposes ............................... | RCFD 5610 0 | M.1.
___________________________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-G--Other Liabilities
__________
| C435 | <-
_________________ ________
Dollar Amounts in Thousands | ////////// Bil Mil Thou |
__________________________________________________________________________________________________ _________________________
<S> <C> <C>
1. a. Interest accrued and unpaid on deposits in domestic offices(2) ............................ | RCON 3645 58,011 | 1.a.
b. Other expenses accrued and unpaid (includes accrued income taxes payable) ................. | RCFD 3646 594,954 | 1.b.
2. Net deferred tax liabilities(1) .............................................................. | RCFD 3049 119,644 | 2.
3. Minority interest in consolidated subsidiaries ............................................... | RCFD 3000 0 | 3.
4. Other (itemize and describe amounts that exceed 25% of this item)............................. | RCFD 2938 478,843 | 4.
_____________ ___________________________
a. | TEXT 3552 |____________________________________________________| RCFD 3552 | | /////////////////////// | 4.a.
___________
b. | TEXT 3553 |____________________________________________________| RCFD 3553 | | /////////////////////// | 4.b.
___________
c. | TEXT 3554 |____________________________________________________| RCFD 3554 | | /////////////////////// | 4.c.
_____________
___________________________
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 20) ........................... | RCFD 2930 1,251,452 | 5.
</TABLE>
____________
(1) See discussion of deferred income taxes in Glossary entry on "income taxes."
(2) For savings banks, include "dividends" accrued and unpaid on deposits.
21
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-12
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-H--Selected Balance Sheet Items for Domestic Offices
__________
| C440 | <-
____________ ________
| Domestic Offices |
____________________
Dollar Amounts in Thousands | RCON Bil Mil Thou |
_____________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Customers' liability to this bank on acceptances outstanding .................................... | 2155 16,634 | 1.
2. Bank's liability on acceptances executed and outstanding ........................................ | 2920 16,634 | 2.
3. Federal funds sold and securities purchased under agreements to resell .......................... | 1350 17,428 | 3.
4. Federal funds purchased and securities sold under agreements to repurchase ...................... | 2800 4,868,836 | 4.
5. Other borrowed money ............................................................................ | 3190 1,380,694 | 5.
EITHER | ////////////////// |
6. Net due from own foreign offices, Edge and Agreement subsidiaries, and IBFs ..................... | 2163 N/A | 6.
OR | ////////////////// |
7. Net due to own foreign offices, Edge and Agreement subsidiaries, and IBFs ....................... | 2941 1,669,058 | 7.
| ////////////////// |
8. Total assets (excludes net due from foreign offices, Edge and Agreement subsidiaries, and IBFs) . | 2192 48,946,123 | 8.
| ////////////////// |
9. Total liabilities (excludes net due to foreign offices, Edge and Agreement subsidiaries, and IBFs)| 3129 42,919,946 | 9.
______________________
</TABLE>
<TABLE>
<CAPTION>
Items 10-17 include held-to-maturity and available-for-sale securities in domestic offices. ______________________
| RCON Bil Mil Thou |
____________________
<S> <C> <C>
10. U.S. Treasury securities ....................................................................... | 1779 1,252,796 | 10.
11. U.S. Government agency and corporation obligations (exclude mortgage-backed | ////////////////// |
securities) .................................................................................... | 1785 505 | 11.
12. Securities issued by states and political subdivisions in the U.S. ............................. | 1786 159,244 | 12.
13. Mortgage-backed securities (MBS): | ////////////////// |
a. Pass-through securities: | ////////////////// |
(1) Issued or guaranteed by FNMA, FHLMC, or GNMA ............................................ | 1787 5,684,860 | 13.a.(1)
(2) Other pass-through securities ........................................................... | 1869 4 | 13.a.(2)
b. Other mortgage-backed securities (include CMOs, REMICs, and stripped MBS): | ////////////////// |
(1) Issued or guaranteed by FNMA, FHLMC, or GNMA ............................................ | 1877 0 | 13.b.(1)
(2) All other mortgage-backed securities..................................................... | 2253 518 | 13.b.(2)
14. Other domestic debt securities ................................................................. | 3159 812 | 14.
15. Foreign debt securities ........................................................................ | 3160 97,035 | 15.
16. Equity securities: | ////////////////// |
a. Investments in mutual funds ................................................................. | 3161 0 | 16.a.
b. Other equity securities with readily determinable fair values ............................... | 3162 0 | 16.b.
c. All other equity securities ................................................................. | 3169 311,734 | 16.c.
17. Total held-to-maturity and available-for-sale securities (sum of items 10 through 16) .......... | 3170 7,507,508 | 17.
______________________
</TABLE>
<TABLE>
<CAPTION>
Memorandum (to be completed only by banks with IBFs and other "foreign" offices)
______________________
Dollar Amounts in Thousands | RCON Bil Mil Thou |
_____________________________________________________________________________________________________ ____________________
<S> <C> <C>
EITHER | ////////////////// |
1. Net due from the IBF of the domestic offices of the reporting bank .............................. | 3051 0 | M.1.
OR | ////////////////// |
2. Net due to the IBF of the domestic offices of the reporting bank ................................ | 3059 N/A | M.2.
______________________
</TABLE>
22
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-13
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Schedule RC-I--Selected Assets and Liabilities of IBFs
To be completed only by banks with IBFs and other "foreign" offices. __________
| C445 | <-
____________ ________
Dollar Amounts in Thousands | RCFN Bil Mil Thou |
_____________________________________________________________________________________________________ ____________________
1. Total IBF assets of the consolidated bank (component of Schedule RC, item 12) ................. | 2133 0 | 1.
2. Total IBF loans and lease financing receivables (component of Schedule RC-C, part I, item 12, | ////////////////// |
column A) ..................................................................................... | 2076 0 | 2.
3. IBF commercial and industrial loans (component of Schedule RC-C, part I, item 4, column A) .... | 2077 0 | 3.
4. Total IBF liabilities (component of Schedule RC, item 21) ..................................... | 2898 0 | 4.
5. IBF deposit liabilities due to banks, including other IBFs (component of Schedule RC-E, | ////////////////// |
part II, items 2 and 3) ....................................................................... | 2379 0 | 5.
6. Other IBF deposit liabilities (component of Schedule RC-E, part II, items 1, 4, 5, and 6) ..... | 2381 0 | 6.
______________________
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Schedule RC-K--Quarterly Averages (1)
__________
| C455 | <-
_________________ ________
Dollar Amounts in Thousands | ///////// Bil Mil Thou |
_______________________________________________________________________________________________ _________________________
ASSETS | /////////////////////// |
1. Interest-bearing balances due from depository institutions .............................. | RCFD 3381 10,737 | 1.
2. U.S. Treasury securities and U.S. Government agency and corporation obligations(2) ...... | RCFD 3382 6,349,267 | 2.
3. Securities issued by states and political subdivisions in the U.S.(2) ................... | RCFD 3383 155,938 | 3.
4. a. Other debt securities(2) ............................................................. | RCFD 3647 98,458 | 4.a.
b. Equity securities(3) (includes investments in mutual funds and Federal Reserve stock). | RCFD 3648 347,675 | 4.b.
5. 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 ............. | RCFD 3365 812,114 | 5.
6. Loans: | ///////////////////// // |
a. Loans in domestic offices: | /////////////////////// |
(1) Total loans ...................................................................... | RCON 3360 31,884,320 | 6.a.(1)
(2) Loans secured by real estate ..................................................... | RCON 3385 14,940,513 | 6.a.(2)
(3) Loans to finance agricultural production and other loans to farmers .............. | RCON 3386 5,935 | 6.a.(3)
(4) Commercial and industrial loans .................................................. | RCON 3387 12,923,362 | 6.a.(4)
(5) Loans to individuals for household, family, and other personal expenditures ...... | RCON 3388 2,224,980 | 6.a.(5)
b. Total loans in foreign offices, Edge and Agreement subsidiaries, and IBFs ............ | RCFN 3360 70,458 | 6.b.
7. Trading assets .......................................................................... | RCFD 3401 105,824 | 7.
8. Lease financing receivables (net of unearned income) .................................... | RCFD 3484 2,231,479 | 8.
9. Total assets (4) ........................................................................ | RCFD 3368 52,282,230 | 9.
LIABILITIES | /////////////////////// |
10. Interest-bearing transaction accounts in domestic offices (NOW accounts, ATS accounts, | /////////////////////// |
and telephone and preauthorized transfer accounts) (exclude demand deposits) ............ | RCON 3485 965,535 | 10.
11. Nontransaction accounts in domestic offices: | /////////////////////// |
a. Money market deposit accounts (MMDAs) ................................................ | RCON 3486 9,210,475 | 11.a.
b. Other savings deposits ............................................................... | RCON 3487 3,907,216 | 11.b.
c. Time certificates of deposit of $100,000 or more ..................................... | RCON 3345 2,653,452 | 11.c.
d. All other time deposits .............................................................. | RCON 3469 7,513,443 | 11.d.
12. Interest-bearing deposits in foreign offices, Edge and Agreement subsidiaries, and IBFs.. | RCFN 3404 1,765,593 | 12.
13. 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 ............. | RCFD 3353 6,363,286 | 13.
14. Other borrowed money .................................................................... | RCFD 3355 2,670,145 | 14.
___________________________
</TABLE>
_______________
(1) For all items, banks have the option of reporting either (1) an average of
daily figures for the quarter, or
(2) an average of weekly figures (i.e., the Wednesday of each week of the
quarter).
(2) Quarterly averages for all debt securities should be based on amortized
cost.
(3) Quarterly averages for all equity securities should be based on historical
cost.
(4) The quarterly average for total assets should reflect all debt securities
(not held for trading) at amortized cost, equity securities with readily
determinable fair values at the lower of cost or fair value, and equity
securities without readily determinable fair values at historical cost.
23
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-14
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-L--Off-Balance Sheet Items
Please read carefully the instructions for the preparation of Schedule RC-L. Some of the amounts
reported in Schedule RC-L are regarded as volume indicators and not necessarily as measures of risk. __________
| C460 | <-
____________ ________
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
____________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Unused commitments: | ////////////////// |
a. Revolving, open-end lines secured by 1-4 family residential properties, e.g., home | ////////////////// |
equity lines ............................................................................... | 3814 1,637,875 | 1.a.
b. Credit card lines .......................................................................... | 3815 32,940 | 1.b.
c. Commercial real estate, construction, and land development: | ////////////////// |
(1) Commitments to fund loans secured by real estate ....................................... | 3816 648,369 | 1.c.(1)
(2) Commitments to fund loans not secured by real estate ................................... | 6550 383,022 | 1.c.(2)
d. Securities underwriting .................................................................... | 3817 0 | 1.d.
e. Other unused commitments ................................................................... | 3818 18,626,522 | 1.e.
2. Financial standby letters of credit and foreign office guarantees ............................. | 3819 2,337,268 | 2.
___________________________
a. Amount of financial standby letters of credit conveyed to others | RCFD 3820 | 158,029 | ////////////////// | 2.a.
___________________________
3. Performance standby letters of credit and foreign office guarantees ........................... | 3821 175,703 | 3.
a. Amount of performance standby letters of credit conveyed to | ////////////////// |
___________________________
others .......................................................... | RCFD 3822 | 12,580 | ////////////////// | 3.a.
___________________________
4. Commercial and similar letters of credit ...................................................... | 3411 176,335 | 4.
5. Participations in acceptances (as described in the instructions) conveyed to others by | ////////////////// |
the reporting bank ............................................................................ | 3428 16,524 | 5.
6. Participations in acceptances (as described in the instructions) acquired by the reporting | ////////////////// |
(nonaccepting) bank ........................................................................... | 3429 7,409 | 6.
7. Securities borrowed ........................................................................... | 3432 0 | 7.
8. Securities lent (including customers' securities lent where the customer is indemnified | ////////////////// |
against loss by the reporting bank) ........................................................... | 3433 0 | 8.
9. Loans transferred (i.e., sold or swapped) with recourse that have been treated as sold for | ////////////////// |
Call Report purposes: | ////////////////// |
a. FNMA and FHLMC residential mortgage loan pools: | ////////////////// |
(1) Outstanding principal balance of mortgages transferred as of the report date ........... | 3650 246,244 | 9.a.(1)
(2) Amount of recourse exposure on these mortgages as of the report date ................... | 3651 246,244 | 9.a.(2)
b. Private (nongovernment-issued or -guaranteed) residential mortgage loan pools: | ////////////////// |
(1) Outstanding principal balance of mortgages transferred as of the report date ........... | 3652 33,550 | 9.b.(1)
(2) Amount of recourse exposure on these mortgages as of the report date ................... | 3653 33,550 | 9.b.(2)
c. Farmer Mac agricultural mortgage loan pools: | ////////////////// |
(1) Outstanding principal balance of mortgages transferred as of the report date ........... | 3654 0 | 9.c.(1)
(2) Amount of recourse exposure on these mortgages as of the report date ................... | 3655 0 | 9.c.(2)
d. Small business obligations transferred with recourse under Section 208 of the | ////////////////// |
Riegle Community Development and Regulatory Improvement Act of 1994: | ////////////////// |
(1) Outstanding principal balance of small business obligations transferred | ////////////////// |
as of the report date................................................................... | A249 0 | 9.d.(1)
(2) Amount of retained recourse on these obligations as of the report date.................. | A250 0 | 9.d.(2)
10. When-issued securities: | ////////////////// |
a. Gross commitments to purchase .............................................................. | 3434 0 | 10.a.
b. Gross commitments to sell .................................................................. | 3435 0 | 10.b.
11. Spot foreign exchange contracts ............................................................... | 8765 622,366 | 11.
12. All other off-balance sheet liabilities (exclude off-balance sheet derivatives) (itemize and | ////////////////// |
describe each component of this item over 25% of Schedule RC, item 28, "Total equity capital") | 3430 0 | 12.
a. | TEXT 3555 |______________________________________________________| RCFD 3555 | | ////////////////// | 12.a.
b. | TEXT 3556 |______________________________________________________| RCFD 3556 | | ////////////////// | 12.b.
___________
c. | TEXT 3557 |______________________________________________________| RCFD 3557 | | ////////////////// | 12.c.
_____________
d. | TEXT 3558 |______________________________________________________| RCFD 3558 | | ////////////////// | 12.d.
_____________ _______________________________________________
Dollar Amounts in Thousands RCFD Bil Mil Thou
_________________________________________________________________________________________________________________________
13. All other off-balance sheet assets (exclude off-balance sheet derivatives) (itemize and | ////////////////// |
describe each component of this item over 25% of Schedule RC,item 28,"Total equity capital") | 5591 0 | 13.
_____________ __________________________
a. | TEXT 5592 |______________________________________________________| RCFD 5592 | | ////////////////// | 13.a.
___________
b. | TEXT 5593 |______________________________________________________| RCFD 5593 | | ////////////////// | 13.b.
___________
c. | TEXT 5594 |______________________________________________________| RCFD 5594 | | ////////////////// | 13.c.
_____________
d. | TEXT 5595 |______________________________________________________| RCFD 5595 | | ////////////////// | 13.d.
_____________
________________________________________________
</TABLE>
24
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-15
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
Schedule RC-L -- Continued
_____________
| C461 | <-
_________________________________________ ____________________________|___________|
| (Column A) | (Column B) | (Column C) | (Column D) |
| Interest Rate | Foreign Exchange | Equity Derivative | Commodity and other|
| Contracts | Contracts | Contracts | Contracts |
|___________________|____________________|____________________|____________________|
Dollar Amounts in Thousands |Tril Bil Mil Thou | Tril Bil Mil Thou | Tril Bil Mil Thou | Tril Bil Mil Thou |
_______________________________________________________________________________________________________________________|
<S> <C> <C> <C> <C> <C>
| Off-balance Sheet Derivatives | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
| Position Indicators | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
____________________________________| ///////////////// | ////////////////// | ////////////////// | ////////////////// |
14. Gross amounts (e.g., notional | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
amounts) (for each column, sum of | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
items 14.a through 14.e must equal | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
sum of items 15, 16.a, and 16.b): |___________________|____________________|___________________ |____________________|
a. Futures contracts ............. | 1,229,392 | 0 | 0 | 36,486 | 14.a.
|___________________|____________________|____________________|____________________|
| RCFD 8693 | RCFD 8694 | RCFD 8695 | RCFD 8696 |
|___________________|____________________|____________________|____________________|
b. Forward contracts ............. | 2,576,500 | 1,931,682 | 0 | 21,832 | 14.b.
|___________________|____________________|____________________|____________________|
| RCFD 8697 | RCFD 8698 | RCFD 8699 | RCFD 8700 |
|___________________|____________________|____________________|____________________|
c. Exchange-traded option contracts:| ///////////////// | ////////////////// | ////////////////// | ////////////////// |
|___________________|____________________|____________________|____________________|
(1) Written options .......... | 0 | 0 | 0 | 0 | 14.c.(1)
|___________________|____________________|____________________|____________________|
| RCFD 8701 | RCFD 8702 | RCFD 8703 | RCFD 8704 |
|___________________|____________________|____________________|____________________|
(2) Purchased options ........ | 450,000 | 0 | 0 | 2,206 | 14.c.(2)
|___________________|____________________|____________________|____________________|
| RCFD 8705 | RCFD 8706 | RCFD 8707 | RCFD 8708 |
|___________________|____________________|____________________|____________________|
d. Over-the-counter option contracts: | //////////////////| ///////////////// | ///////////////// | //////////////// |
(1) Written options .......... | 1,324,980 | 3,887 | 0 | 0 | 14.d.(1)
|___________________|____________________|____________________|____________________|
| RCFD 8709 | RCFD 8710 | RCFD 8711 | RCFD 8712 |
|___________________|____________________|____________________|____________________|
(2) Purchased options ........ | 10,131,934 | 3,887 | 0 | 0 | 14.d.(2)
|___________________|____________________|____________________|____________________|
| RCFD 8713 | RCFD 8714 | RCFD 8715 | RCFD 8716 |
|___________________|____________________|____________________|____________________|
e. Swaps ............................ | 19,502,262 | 0 | 0 | 0 | 14.e.
|___________________|____________________|____________________|____________________|
| RCFD 3450 | RCFD 3826 | RCFD 8719 | RCFD 8720 |
|___________________|____________________|____________________|____________________|
15. Total gross notional amount of | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
derivative contracts held for | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
trading ......................... | 3,386,305 | 1,939,456 | 0 | 2,206 | 15.
|___________________|____________________|____________________|____________________|
| RCFD A126 | RFD A127 | RCFD 8723 | RCFD 8724 |
|___________________|____________________|____________________|____________________|
16. Total gross notional amount of | ///////////////// | //////////////// | ///////////////// | ////////////////// |
derivative contracts held for | ///////////////// | ///////////////// | ///////////////// | ////////////////// |
purposes other than trading: | ///////////////// | ///////////////// | ///////////////// | ////////////////// |
|___________________|____________________|____________________|____________________|
a. Contracts marked to market ... | 4,202,500 | 0 | 0 | 36,486 | 16.a.
|___________________|____________________|____________________|____________________|
| RCFD 8725 | RCFD 8726 | RCF 8727 | RCFD 8728 |
|___________________|____________________|____________________|____________________|
b. Contracts not marked to market | 27,626,263 | 0 | 0 | 21,832 | 16.b.
|___________________|____________________|____________________|____________________|
| RCFD 8729 | RCFD 8730 | RFD 8731 | RCFD 8732 |
|___________________|____________________|____________________|____________________|
</TABLE>
25
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-16
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
Schedule RC-L -- Continued
<CAPTION>
_________________________________________ _________________________________________
| (Column A) | (Column B) | (Column C) | (Column D) |
Dollar Amounts in Thousands | Interest Rate | Foreign Exchange | Equity Derivative | Commodity and other|
___________________________________| Contracts | Contracts | Contracts | Contracts |
| Off-balance Sheet Derivatives |___________________|____________________|____________________|____________________|
| Position Indicators |RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
|_____________________________________________________________________________________________________________________|
<S> <C> <C> <C> <C> <C>
17. Gross fair values of | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
derivative contracts: | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
a. Contracts held for | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
trading: | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
(1) Gross positive | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value ................... | 8733 29,782 | 8734 41,523 | 8735 0 | 8736 58 | 17.a.(1)
(2) Gross negative | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value ................... | 8737 20,932 | 8738 36,511 | 8739 0 | 8740 0 | 17.a.(2)
b. Contracts held for | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
purposes other than | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
trading that are marked | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
to market: | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
(1) Gross positive | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value ................... | 8741 524 | 8742 0 | 8743 0 | 8744 1,452 | 17.b.(1)
(2) Gross negative | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value ................... | 8745 2,834 | 8746 0 | 8747 0 | 8748 0 | 17.b.(2)
c. Contracts held for | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
purposes other than | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
trading that are not | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
marked to market: | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
(1) Gross positive | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value .................. | 8749 64,085 | 8750 0 | 8751 0 | 8752 100 | 17.c.(1)
(2) Gross negative | ///////////////// | ////////////////// | ////////////////// | ////////////////// |
fair value ................... | 8753 111,703 | 8754 0 | 8755 0 | 8756 0 | 17.c.(2)
|__________________________________________________________________________________|
</TABLE>
<TABLE>
<CAPTION>
______________________
Memoranda Dollar Amounts in Thousands | RCFD Bil Mil Thou |
_________________________________________________________________________________________________________________________
<S> <C> <C>
1. -2. Not applicable | ////////////////// |
3. Unused commitments with an original maturity exceeding one year that are reported in | ////////////////// |
Schedule RC-L, items 1.a through 1.e, above (report only the unused portions of commitments | ////////////////// |
that are fee paid or otherwise legally binding) ................................................ | 3833 16,829,602 | M.3.
a. Participations in commitments with an original maturity | ////////////////// |
exceeding one year conveyed to others ................................|RCFD 3834 | 1,310,691 | ////////////////// | M.3.a.
________________________
4. To be completed only by banks with $1 billion or more in total assets: | ////////////////// |
Standby letters of credit and foreign office guarantees (both financial and performance) issued | ////////////////// |
to non-U.S. addressees (domicile) included in Schedule RC-L, items 2 and 3, above .............. | 3377 341,139 | M.4.
5. Installment loans to individuals for household, family, and other personal expenditures that | ////////////////// |
have been securitized and sold without recourse (with servicing retained), amounts outstanding | ////////////////// |
by type of loan: | ////////////////// |
a. Loans to purchase private passenger automobiles (to be completed for the | ////////////////// |
September report only)....................................................................... | 2741 N/A | M.5.a.
b. Credit cards and related plans (TO BE COMPLETED QUARTERLY)................................... | 2742 0 | M.5.b.
c. All other consumer installment credit (including mobile home loans)(to be completed for the | ////////////////// |
September report only........................................................................ | 2743 N/A | M.5.c
|____________________|
</TABLE>
26
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-17
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9| _____________
| C465 |
_________|___________|
Schedule RC-M--Memoranda | |
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
______________________________________________________________________________________________________|____________________|
<S> <C> <C>
1. Extensions of credit by the reporting bank to its executive officers, directors, principal | ////////////////// |
shareholders, and their related interests as of the report date: | ////////////////// |
a. Aggregate amount of all extensions of credit to all executive officers, directors, principal | ////////////////// |
shareholders and their related interests ..................................................... | 6164 605,294 | 1.a.
b. Number of executive officers, directors, and principal shareholders to whom the amount of all | ////////////////// |
extensions of credit by the reporting bank (including extensions of credit to | ////////////////// |
related interests) equals or exceeds the lesser of $500,000 or 5 percent Number | ////////////////// |
___________________________| ////////////////// |
of total capital as defined for this purpose in agency regulations. | RCFD 6165 | 24 | ////////////////// |
___________________________| ////////////////// | 1.b.
2. Federal funds sold and securities purchased under agreements to resell with U.S. branches | ////////////////// |
and agencies of foreign banks(1) (included in Schedule RC, items 3.a and 3.b) .................... | 3405 0 | 2.
3. Not applicable. | ////////////////// |
4. Outstanding principal balance of 1-4 family residential mortgage loans serviced for others | ////////////////// |
(include both retained servicing and purchased servicing): | ////////////////// |
a. Mortgages serviced under a GNMA contract ...................................................... | 5500 28,855,729 | 4.a.
b. Mortgages serviced under a FHLMC contract: | ////////////////// |
(1) Serviced with recourse to servicer ........................................................ | 5501 55,604 | 4.b.(1)
(2) Serviced without recourse to servicer ..................................................... | 5502 32,340,522 | 4.b.(2)
c. Mortgages serviced under a FNMA contract: | ////////////////// |
(1) Serviced under a regular option contract .................................................. | 5503 190,640 | 4.c.(1)
(2) Serviced under a special option contract .................................................. | 5504 38,282,672 | 4.c.(2)
d. Mortgages serviced under other servicing contracts ............................................ | 5505 8,508,320 | 4.d.
5. To be completed only by banks with $1 billion or more in total assets: | ////////////////// |
Customers' liability to this bank on acceptances outstanding (sum of items 5.a and 5.b must | ////////////////// |
equal Schedule RC, item 9): | ////////////////// |
a. U.S. addressees (domicile) .................................................................... | 2103 16,297 | 5.a.
b. Non-U.S. addressees (domicile) ................................................................ | 2104 337 | 5.b.
6. Intangible assets: | ////////////////// |
a. Mortgage servicing rights ..................................................................... | 3164 1,483,959 | 6.a.
b. Other identifiable intangible assets: | ////////////////// |
(1) Purchased credit card relationships ....................................................... | 5506 0 | 6.b.(1)
(2) All other identifiable intangible assets .................................................. | 5507 126,463 | 6.b.(2)
c. Goodwill ...................................................................................... | 3163 672,992 | 6.c.
d. Total (sum of items 6.a through 6.c) (must equal Schedule RC, item 10) ........................ | 2143 2,283,414 | 6.d.
e. Amount of intangible assets (included in item 6.b.(2) above) that have been grandfathered or | ////////////////// |
are otherwise qualifying for regulatory capital purposes ...................................... | 6442 0 | 6.e.
7. Mandatory convertible debt, net of common or perpetual preferred stock dedicated to | ////////////////// |
redeem the debt ...................................................................................| 3295 75,000 | 7.
______________________
</TABLE>
- ------------
(1) Do not report federal funds sold and securities purchased under agreements
to resell with other commercial banks in the U.S. in this item.
27
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-18
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
Schedule RC-M--Continued ________________________
Dollar Amounts in Thousands | Bil Mil Thou|
_____________________________________________________________________________________________ |_______________________|
<S> <C> <C>
8. a. Other real estate owned: | /////////////////////// |
(1) Direct and indirect investments in real estate ventures ......................... | RCFD 5372 0 | 8.a.(1)
(2) All other real estate owned: | /////////////////////// |
(a) Construction and land development in domestic offices ....................... | RCON 5508 4,537 | 8.a.(2)(a)
(b) Farmland in domestic offices ................................................ | RCON 5509 0 | 8.a.(2)(b)
(c) 1-4 family residential properties in domestic offices ....................... | RCON 5510 8,067 | 8.a.(2)(c)
(d) Multifamily (5 or more) residential properties in domestic offices .......... | RCON 5511 740 | 8.a.(2)(d)
(e) Nonfarm nonresidential properties in domestic offices ....................... | RCON 5512 21,202 | 8.a.(2)(e)
(f) In foreign offices .......................................................... | RCFN 5513 0 | 8.a.(2)(f)
(3) Total (sum of items 8.a.(1) and 8.a.(2)) (must equal Schedule RC, item 7) ....... | RCFD 2150 34,546 | 8.a.(3)
b. Investments in unconsolidated subsidiaries and associated companies: | /////////////////////// |
(1) Direct and indirect investments in real estate ventures ......................... | RCFD 5374 0 | 8.b.(1)
(2) All other investments in unconsolidated subsidiaries and associated companies ... | RCFD 5375 0 | 8.b.(2)
(3) Total (sum of items 8.b.(1) and 8.b.(2)) (must equal Schedule RC, item 8) ....... | RCFD 2130 0 | 8.b.(3)
c. Total assets of unconsolidated subsidiaries and associated companies ................ | RCFD 5376 0 | 8.c.
9. Noncumulative perpetual preferred stock and related surplus included in Schedule RC, | /////////////////////// |
item 23, "Perpetual preferred stock and related surplus" ............................... | RCFD 3778 125,000 | 9.
10. Mutual fund and annuity sales in domestic offices during the quarter (include | /////////////////////// |
proprietary, private label, and third party products): | /////////////////////// |
a. Money market funds .................................................................. | RCON 6441 55,245 | 10.a.
b. Equity securities funds ............................................................. | RCON 8427 108,359 | 10.b.
c. Debt securities funds ............................................................... | RCON 8428 13,250 | 10.c.
d. Other mutual funds .................................................................. | RCON 8429 0 | 10.d.
e. Annuities ........................................................................... | RCON 8430 102,292 | 10.e.
f. Sales of proprietary mutual funds and annuities (included in items 10.a through | /////////////////////// |
10.e. above) ........................................................................... | RCON 8784 150,100 | 10.f.
_________________________
</TABLE>
<TABLE>
<CAPTION>
_________________________________________________________________________________________________________________________________
| |
______________________
|Memorandum Dollar Amounts in Thousands | RCFD Bil Mil Thou | |
_________________________________________________________________________________________________ ____________________
<S> <C> <C>
|1. Interbank holdings of capital instruments (to be completed for the December report only): | ////////////////// | |
| a. Reciprocal holdings of banking organizations' capital instruments ........................ | 3836 N/A | M.1.a. |
| b. Nonreciprocal holdings of banking organizations' capital instruments ..................... | 3837 N/A | M.1.b. |
______________________
| |
_________________________________________________________________________________________________________________________________
</TABLE>
28
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-19
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-N--Past Due and Nonaccrual Loans, Leases,
and Other Assets
The FFIEC regards the information reported in __________
all of Memorandum item 1, in items 1 through 10, | C470 | <-
column A, and in Memorandum items 2 through 4, ______________________________________________________ ________
column A, as confidential. | (Column A) | (Column B) | (Column C) |
| Past due | Past due 90 | Nonaccrual |
| 30 through 89 | days or more | |
| days and still | and still | |
| accruing | accruing | |
____________________ ____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
______________________________________________________ ____________________ ____________________ ____________________
<S> <C> <C> <C> <C>
1. Loans secured by real estate: | ////////////////// | ////////////////// | ////////////////// |
a. To U.S. addressees (domicile) ................ | 1245 | 1246 71,390 | 1247 223,962 | 1.a.
b. To non-U.S. addressees (domicile) ............ | 1248 | 1249 0 | 1250 0 | 1.b.
2. Loans to depository institutions and | ///// | ////////////////// | ////////////////// |
acceptances of other banks: | ///// | ////////////////// | ////////////////// |
a. To U.S. banks and other U.S. depository | ///// | ////////////////// | ////////////////// |
institutions ................................. | 5377 | 5378 0 | 5379 0 | 2.a.
b. To foreign banks ............................. | 5380 | 5381 0 | 5382 0 | 2.b.
3. Loans to finance agricultural production and | ///// | ////////////////// | ////////////////// |
other loans to farmers .......................... | 1594 | 1597 385 | 1583 531 | 3.
4. Commercial and industrial loans: | ///// | ////////////////// | ////////////////// |
a. To U.S. addressees (domicile) ................ | 1251 | 1252 11,945 | 1253 108,334 | 4.a.
b. To non-U.S. addressees (domicile) ............ | 1254 | 1255 0 | 1256 0 | 4.b.
5. Loans to individuals for household, family, and | ///// | ////////////////// | ////////////////// |
other personal expenditures: | ///// | ////////////////// | ///////////////// |
a. Credit cards and related plans ............... | 5383 | 5384 1,187 | 5385 669 | 5.a.
b. Other (includes single payment, installment, | ///// | ////////////////// | ////////////////// |
and all student loans) ....................... | 5386 | 5387 22,600 | 5388 8,465 | 5.b.
6. Loans to foreign governments and official | ///// | ////////////////// | ////////////////// |
institutions .................................... | 5389 | 5390 0 | 5391 0 | 6.
7. All other loans ................................. | 5459 | 5460 14,909 | 5461 1,919 | 7.
8. Lease financing receivables: | ///// | ////////////////// | ////////////////// |
a. Of U.S. addressees (domicile) ................ | 1257 | 1258 95 | 1259 6,544 | 8.a.
b. Of non-U.S. addressees (domicile) ............ | 1271 | 1272 0 | 1791 0 | 8.b.
9. Debt securities and other assets (exclude other | ///// | ////////////////// | ////////////////// |
real estate owned and other repossessed assets) . | 3505 | 3506 0 | 3507 85,778 | 9.
________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
====================================================================================================================================
Amounts reported in items 1 through 8 above include guaranteed and unguaranteed portions of past due and nonaccrual loans and
leases. Report in item 10 below certain guaranteed loans and leases that have already been included in the amounts reported in
items 1 through 8.
________________________________________________________________
| RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
____________________ ____________________ ____________________
<S> <C> <C> <C> <C>
10. Loans and leases reported in items 1 | | | |
through 8 above which are wholly or partially | ///// | ////////////////// | ////////////////// |
guaranteed by the U.S. Government ............... | 5612 | 5613 18,447 | 5614 21,415 | 10.
a. Guaranteed portion of loans and leases | ///// | ////////////////// | ////////////////// |
included in item 10 above .................... | 5615 | 5616 18,250 | 5617 16,952 | 10.a.
________________________________________________________________
</TABLE>
29
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-20
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-N--Continued
__________
| C473 | <-
______________________________________________________ ________
| (Column A) | (Column B) | (Column C) |
| Past due | Past due 90 | Nonaccrual |
| 30 through 89 | days or more | |
| days and still | and still | |
Memoranda | accruing | accruing | |
____________________ ____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
______________________________________________________ ____________________ ____________________ ____________________
<S> <C> <C> <C> <C>
1. Restructured loans and leases included in | ///// | /////////////////// | ///////////////// |
Schedule RC-N, items 1 through 8, above (and not | ///// | //// | |
reported in Schedule RC-C, part I, Memorandum | ///// | //// | |
item 2) ......................................... | 1658 | 1659 | | M.1.
2. Loans to finance commercial real estate, | ///// | //// | |
construction, and land development activities | ///// | //// | |
(not secured by real estate) included in | ///// | /////////////////// | ///////////////// |
Schedule RC-N, items 4 and 7, above ............. | 6558 | 6559 826 | 6560 7,043 | M.2.
|____________________|____________________ |___________________
3. Loans secured by real estate in domestic offices | RCON | RCON Bil Mil Thou | RCON Bil Mil Thou|
|___________________ |____________________ ____________________
(included in Schedule RC-N, item 1, above): | ///// | ////////////////// | ////////////////// |
a. Construction and land development ............ | 2759 | 2769 1,100 | 3492 26,422 | M.3.a.
b. Secured by farmland .......................... | 3493 | 3494 161 | 3495 0 | M.3.b.
c. Secured by 1-4 family residential properties: | ///// | ////////////////// | ////////////////// |
(1) Revolving, open-end loans secured by | ///// | ////////////////// | ////////////////// |
1-4 family residential properties and | ///// | ////////////////// | ////////////////// |
extended under lines of credit ........... | 5398 | 5399 5,114 | 5400 17,374 | M.3.c.(1)
(2) All other loans secured by 1-4 family | ///// | ////////////////// | ////////////////// |
residential properties ................... | 5401 | 5402 58,079 | 5403 75,430 | M.3.c.(2)
d. Secured by multifamily (5 or more) | ///// | ////////////////// | ////////////////// |
residential properties ....................... | 3499 | 3500 521 | 3501 12,491 | M.3.d.
e. Secured by nonfarm nonresidential properties . | 3502 | 3503 6,415 | 3504 92,245 | M.3.e.
________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
___________________________________________
| (Column A) | (Column B) |
| Past due 30 | Past due 90 |
| through 89 days | days or more |
____________________ ____________________
| RCFD Bil Mil Thou | RCFD Bil Mil Thou |
____________________ ____________________
<S> <C> <C> <C>
4. Interest rate, foreign exchange rate, and other | ///// | ////////////////// |
commodity and equity contracts: | ///// | ////////////////// |
a. Book value of amounts carried as assets ...... | 3522 | 3528 0 | M.4.a.
b. Replacement cost of contracts with a | ///// | ////////////////// |
positive replacement cost .................... | 3529 | 3530 0 | M.4.b.
___________________________________________
</TABLE>
30
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-21
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
______________________
Schedule RC-O--Other Data for Deposit Insurance Assessments | C475 |
|____________________|
Dollar Amounts in Thousands | RCON Bil Mil Thou |
___________________________________________________________________________________________________ ____________________
<S> <C> <C>
1. Unposted debits (see instructions): | ////////////////// |
a. Actual amount of all unposted debits ...................................................... | 0030 216 | 1.a.
OR | ////////////////// |
b. Separate amount of unposted debits: | ////////////////// |
(1) Actual amount of unposted debits to demand deposits ................................... | 0031 N/A | 1.b.(1)
(2) Actual amount of unposted debits to time and savings deposits(1) ...................... | 0032 N/A | 1.b.(2)
2. Unposted credits (see instructions): | ////////////////// |
a. Actual amount of all unposted credits ..................................................... | 3510 216 | 2.a.
OR | ////////////////// |
b. Separate amount of unposted credits: | ////////////////// |
(1) Actual amount of unposted credits to demand deposits .................................. | 3512 N/A | 2.b.(1)
(2) Actual amount of unposted credits to time and savings deposits(1) ..................... | 3514 N/A | 2.b.(2)
3. Uninvested trust funds (cash) held in bank's own trust department (not included in total | ////////////////// |
deposits in domestic offices) ................................................................ | 3520 101,763 | 3.
4. Deposits of consolidated subsidiaries in domestic offices and in insured branches in | ////////////////// |
Puerto Rico and U.S. territories and possessions (not included in total deposits): | ////////////////// |
a. Demand deposits of consolidated subsidiaries .............................................. | 2211 206,111 | 4.a.
b. Time and savings deposits(1) of consolidated subsidiaries ................................. | 2351 20,089 | 4.b.
c. Interest accrued and unpaid on deposits of consolidated subsidiaries ...................... | 5514 8 | 4.c.
5. Deposits in insured branches in Puerto Rico and U.S. territories and possessions: | ////////////////// |
a. Demand deposits in insured branches (included in Schedule RC-E, Part II) .................. | 2229 0 | 5.a.
b. Time and savings deposits(1) in insured branches (included in Schedule RC-E, Part II) ..... | 2383 0 | 5.b.
c. Interest accrued and unpaid on deposits in insured branches | ////////////////// |
(included in Schedule RC-G, item 1.b) ..................................................... | 5515 0 | 5.c.
______________________
______________________
Item 6 is not applicable to state nonmember banks that have not been authorized by the | ////////////////// |
Federal Reserve to act as pass-through correspondents. | ////////////////// |
6. Reserve balances actually passed through to the Federal Reserve by the reporting bank on | ////////////////// |
behalf of its respondent depository institutions that are also reflected as deposit liabilities| ////////////////// |
of the reporting bank: | ////////////////// |
a. Amount reflected in demand deposits (included in Schedule RC-E, item 4 or 5, column B)..... | 2314 0 | 6.a.
b. Amount reflected in time and savings deposits(1) (included in Schedule RC-E, Part I, | ////////////////// |
item 4 or 5, column A or C, but not column B).............................................. | 2315 0 | 6.b.
7. Unamortized premiums and discounts on time and savings deposits:(1) | ////////////////// |
a. Unamortized premiums ...................................................................... | 5516 769 | 7.a.
b. Unamortized discounts ..................................................................... | 5517 0 | 7.b.
______________________
_______________________________________________________________________________________________________________________________
| |
|8. To be completed by banks with "Oakar deposits." |
______________________
| Total "Adjusted Attributable Deposits" of all institutions acquired under Section 5(d)(3) of | ////////////////// | |
| the Federal Deposit Insurance Act (from most recent FDIC Oakar Transaction Worksheet(s)) .... | 5518 2,188,589 | 8. |
______________________
| |
_______________________________________________________________________________________________________________________________
______________________
9. Deposits in lifeline accounts ................................................................ | 5596 ///////////// | 9.
10. Benefit-responsive "Depository Institution Investment Contracts" (included in total | ////////////////// |
deposits in domestic offices) ................................................................ | 8432 0 | 10.
______________________
______________
(1) For FDIC insurance assessment purposes, "time and savings deposits" consists of nontransaction
accounts and all transaction accounts other than demand deposits.
</TABLE>
31
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-22
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-O--Continued
Dollar Amounts in Thousands | RCON Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
<S> <C> <C>
11. Adjustments to demand deposits in domestic offices reported in Schedule RC-E for | ////////////////// |
certain reciprocal demand balances: | ////////////////// |
a. Amount by which demand deposits would be reduced if reciprocal demand balances | ////////////////// |
between the reporting bank and savings associations were reported on a net basis | ////////////////// |
rather than a gross basis in Schedule RC-E .................................................. | 8785 0 | 11.a.
b. Amount by which demand deposits would be increased if reciprocal demand balances | ////////////////// |
between the reporting bank and U.S. branches and agencies of foreign banks were | ////////////////// |
reported on a gross basis rather than a net basis in Schedule RC-E .......................... | A181 0 | 11.b.
c. Amount by which demand deposits would be reduced if cash items in process of | ////////////////// |
collection were included in the calculation of net reciprocal demand balances between | ////////////////// |
the reporting bank and the domestic offices of U.S. banks and savings associations | ////////////////// |
in Schedule RC-E ............................................................................ | A182 0 | 11.c.
____________________
Memoranda (to be completed each quarter except as noted) Dollar Amounts in Thousands | RCON Bil Mil Thou |
_____________________________________________________________________ ___________________________|____________________|
1. Total deposits in domestic offices of the bank (sum of Memorandum it ems 1.a. (1) and | ////////////////// |
1.b.(1) must equal Schedule RC, item 13.a): | ////////////////// |
a. Deposits accounts of $100,000 or less: | ////////////////// |
(1) amount of deposit accounts of $100,000 or less ....................................... | 2702 19,755,631 | M.1.a.(1)
(2) Number of deposit accounts of $100,000 or less (to be Number | ////////////////// |
completed for the June report only) .............................|RCON 3779 3,742,107 | ////////////////// | M.1.a.(2)
b. Deposit accounts of more than $100,000: | ////////////////// |
(1) Amount of deposit accounts of more than $100,000 ..................................... | 2710 14,354,949 | M.1.b.(1)
Number | ////////////////// |
(2) Number of deposit accounts of more than $100,000 ................|RCON 2722 27,062 | ////////////////// | M.1.b.(2)
2. Estimated amount of uninsured deposits in domestic offices of the bank:
a. An estimate of your bank's uninsured deposits can be determined by mutiplying the
number of deposit accounts of more than $100,000 reported in Memorandum item 1.b.(2)
above by $100,000 and subtracting the result from the amount of deposit accounts of
more than $100,000 reported in Memorandum item 1.b.(1) above.
Indicate in the appropriate box at the right whether your bank has a method or
procedure for determining a better estimate of uninsured deposits than the ____________YES_______NO__
estimated described above .................................................................. | 6861| |///| x | M.2.a.
____________________
b. If the box marked YES has been checked, report the estimate of uninsured deposits |RCON Bil Mil Thou|
determined by using your bank's method or procedure .................................... | 5597 N/A | M.2.b.
_____________________________________________________________________________________________________________________________
| C477 | <-
Person to whom questions about the Reports of Condition and Income should be directed: __________
PAMELA S. FLYNN, VICE PRESIDENT (401) 278-5194
___________________________________________________________________________________ ______________________________________
Name and Title (TEXT 8901) Area code and phone number (TEXT 8902)
</TABLE>
32
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-23
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-R--Regulatory Capital
This schedule must be completed by all banks as follows: Banks that reported total assets of $1 billion or more in Schedule RC,
item 12, for June 30, 1995, must complete items 2 through 9 and Memoranda items 1 and 2. Banks with assets of less than
$1 billion must complete items 1 through 3 below or Schedule RC-R in its entirety, depending on their response to item 1 below.
<S> <C>
____________
| C480 | <-
1. Test for determining the extent to which Schedule RC-R must be completed. To be completed _____|__________|
only by banks with total assets of less than $1 billion. Indicate in the appropriate | YES NO |
box at the right whether the bank has total capital greater than or equal to eight percent___________ _______________
of adjusted total assets ............................................................... | RCFD 6056 | |////| | 1.
_____________________________
For purposes of this test, adjusted total assets equals total assets less cash, U.S. Treasuries, U.S. Government
agency obligations, and 80 percent of U.S. Government-sponsored agency obligations plus the allowance for loan
and lease losses and selected off-balance sheet items as reported on Schedule RC-L (see instructions).
If the box marked YES has been checked, then the bank only has to complete items 2 and 3 below. If the box marked
NO has been checked, the bank must complete the remainder of this schedule.
A NO response to item 1 does not necessarily mean that the bank's actual risk-based capital ratio is less than eight
percent or that the bank is not in compliance with the risk-based capital guidelines.
</TABLE>
<TABLE>
<CAPTION>
___________________________________________
| (Column A) | (Column B) |
|Subordinated Debt(1)| Other |
_________________________________________________________________ | and Intermediate | Limited- |
| NOTE: All banks are required to complete items 2 and 3 below | | Term Preferred | Life Capital |
| See optional worksheet for items 3.a through 3.f. | | Stock | Instruments |
|________________________________________________________________| ____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
______________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
2. Subordinated debt(1) and other limited-life capital instruments (original | | |
weighted average maturity of at least five years) with a remaining | | |
maturity of: | | |
a. One year or less ...................................................... | 3780 25,737 | 3786 0 | 2.a.
b. Over one year through two years ....................................... | 3781 737 | 3787 0 | 2.b.
c. Over two years through three years .................................... | 3782 10,745 | 3788 0 | 2.c.
d. Over three years through four years ................................... | 3783 0 | 3789 0 | 2.d.
e. Over four years through five years .................................... | 3784 0 | 3790 0 | 2.e.
f. Over five years ....................................................... | 3785 1,101,000 | 3791 0 | 2.f.
3. Amounts used in calculating regulatory capital ratios (report amounts | ////////////////// | ////////////////// |
determined by the bank for its own internal regulatory capital analyses): | ////////////////// | RCFD Bil Mil Thou |
a. Tier 1 capital......................................................... | ////////////////// | 8274 3,590,367 | 3.a.
b. Tier 2 capital......................................................... | ////////////////// | 8275 1,755,646 | 3.b.
c. Total risk-based capital............................................... | ////////////////// | 3792 5,346,013 | 3.c.
d. Excess allowance for loan and lease losses............................. | ////////////////// | A222 297,250 | 3.d.
e. Risk-weighted assets................................................... | ////////////////// | A223 45,718,856 | 3.e.
f. "Average total assets"................................................. | ////////////////// | A224 51,482,775 | 3.f.
___________________________________________
| (Column A) | (Column B) |
Items 4-9 and Memoranda items 1 and 2 are to be completed | Assets | Credit Equiv- |
by banks that answered NO to item 1 above and | Recorded | alent Amount |
by banks with total assets of $1 billion or more. | on the | of Off-Balance |
| Balance Sheet | Sheet Items(2) |
____________________ ____________________
| RCFD Bil Mil Thou | RCFD Bil Mil Thou |
____________________ ____________________
<S> <C> <C> <C>
4. Assets and credit equivalent amounts of off-balance sheet items assigned | | |
to the Zero percent risk category: | ////////////////// | ////////////////// |
a. Assets recorded on the balance sheet: | ////////////////// | ////////////////// |
(1) Securities issued by, other claims on, and claims unconditionally | ////////////////// | ////////////////// |
guaranteed by, the U.S. Government and its agencies and other | ////////////////// | ////////////////// |
OECD central governments .......................................... | 3794 2,147,648 | ////////////////// | 4.a.(1)
(2) All other ......................................................... | 3795 1,115,265 | ////////////////// | 4.a.(2)
b. Credit equivalent amount of off-balance sheet items ................... | ////////////////// | 3796 101,488 | 4.b.
___________________________________________
</TABLE>
_____
(1) Exclude mandatory convertible debt reported in Schedule RC-M, item 7.
(2) Do not report in column B the risk-weighted amount of assets reported in
column A.
33
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
Address: ONE MONARCH PLACE Page RC-24
City, State Zip: SPRINGFIELD, MA 01102
FDIC Certificate No.: |0|2|4|9|9|
___________
</TABLE>
<TABLE>
<CAPTION>
Schedule RC-R--Continued
___________________________________________
| (Column A) | (Column B) |
| Assets | Credit Equiv- |
| Recorded | alent Amount |
| on the | of Off-Balance |
| Balance Sheet | Sheet Items(1) |
____________________ ____________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou | RCFD Bil Mil Thou |
______________________________________________________________________________ ____________________ ____________________
<S> <C> <C> <C>
5. Assets and credit equivalent amounts of off-balance sheet items | ////////////////// | ////////////////// |
assigned to the 20 percent risk category: | ////////////////// | ////////////////// |
a. Assets recorded on the balance sheet: | ////////////////// | ////////////////// |
(1) Claims conditionally guaranteed by the U.S. Government and its | ////////////////// | ////////////////// |
agencies and other OECD central governments ....................... | 3798 714,375 | ////////////////// | 5.a.(1)
(2) Claims collateralized by securities issued by the U.S. Govern- | ////////////////// | ////////////////// |
ment and its agencies and other OECD central governments; by | ////////////////// | ////////////////// |
securities issued by U.S. Government-sponsored agencies; and | ////////////////// | ////////////////// |
by cash on deposit ................................................ | 3799 0 | ////////////////// | 5.a.(2)
(3) All other ......................................................... | 3800 8,774,345 | ////////////////// | 5.a.(3)
b. Credit equivalent amount of off-balance sheet items ................... | ////////////////// | 3801 791,065 | 5.b.
6. Assets and credit equivalent amounts of off-balance sheet items | ////////////////// | ////////////////// |
assigned to the 50 percent risk category: | ////////////////// | ////////////////// |
a. Assets recorded on the balance sheet .................................. | 3802 5,265,173 | ////////////////// | 6.a.
b. Credit equivalent amount of off-balance sheet items ................... | ////////////////// | 3803 409,680 | 6.b.
7. Assets and credit equivalent amounts of off-balance sheet items | ////////////////// | ////////////////// |
assigned to the 100 percent risk category: | ////////////////// | ////////////////// |
a. Assets recorded on the balance sheet .................................. | 3804 31,799,547 | ////////////////// | 7.a.
b. Credit equivalent amount of off-balance sheet items ................... | ////////////////// | 3805 10,122,631 | 7.b.
8. On-balance sheet asset values excluded from the calculation of the | ////////////////// | ////////////////// |
risk-based capital ratio(2) .............................................. | 3806 83,713 | ////////////////// | 8.
9. Total assets recorded on the balance sheet (sum of | ////////////////// | ////////////////// |
items 4.a, 5.a, 6.a, 7.a, and 8, column A)(must equal Schedule RC, | ////////////////// | ////////////////// |
item 12 plus items 4.b and 4.c) .......................................... | 3807 49,900,066 | ////////////////// | 9.
___________________________________________
Memoranda
______________________
Dollar Amounts in Thousands | RCFD Bil Mil Thou |
__________________________________________________________________________________________________ ____________________
1.Current credit exposure across all off-balance sheet derivative contracts covered by the | ///////////////// |
risked-based capital standards .................................................................| 8764 135,825| M.1.
|___________________|
_____________________________________________________________________
| With a remaining maturity of |
|____________________________________________________________________|
| (Column A) | (Column B) | (Column C) |
| | | |
| One year or less | Over one year | Over five years |
| | through five years | |
|______________________|______________________|______________________|
|RCFD Tril Bil Mil Thou|RCFD Tril Bil Mil Thou|RCFD Tril Bil Mil Thou|
|______________________|______________________|______________________|
2. Notional principal amounts of | | | |
off-balance sheet derivative contracts(3):| | | |
a. Interest rate contracts ................. | 3809 8,320,956 | 8766 18,597,686 | 8767 801,055 | M.2.a.
b. Foreign exchange contracts .............. | 3812 1,578,420 | 8769 101,907 | 8770 0 | M.2.b.
c. Gold contracts .......................... | 8771 15,291 | 8772 0 | 8773 0 | M.2.c.
d. Other precious metals contracts ......... | 8774 8,748 | 8775 0 | 8776 0 | M.2.d.
e. Other commodity contracts ............... | 8777 0 | 8778 0 | 8779 0 | M.2.e.
f. Equity derivative contracts ............. | A000 0 | A001 0 | A002 0 | M.2.f.
|____________________________________________________________________|
</TABLE>
_________________
1) Do not report in column B the risk-weighted amount of
assets reported in column A.
2) Include the difference between the fair value and the amortized cost of
available-for-sale securities in item 8 and report the amortized cost of these
securities in items 4 through 7 above. Item 8 also includes on-balance sheet
asset values (or portions thereof) of off-balance sheet interest rate, foreign
exchange rate, and commodity contracts and those contracts (e.g., futures
contracts) not subject to risk-based capital. Exclude from item 8 margin
accounts and accrued receivables as well as any portion of the allowance for
loan and lease losses in excess of the amount that may be included in Tier 2
capital. 3) Exclude foreign exchange contracts with an original maturity of 14
days or less and all futures contracts.
34
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: FLEET NATIONAL BANK
Address: ONE MONARCH PLACE Call Date: 06/30/96 ST-BK: 25-0590 FFIEC 031
City, State, Zip: SPRINGFIELD, MA 01102 Page RC-25
FDIC Certificate No.: 02499
</TABLE>
Optional Narrative Statement Concerning the Amounts
Reported in the Reports of Condition and Income
at close of business on June 30, 1996
FLEET NATIONAL BANK SPRINGFIELD , MASSACHUSETTS
- ------------------- ----------------- -------------
Legal Title of Bank City State
The management of the reporting bank may, if it wishes, submit a brief
narrative statement on the amounts reported in the Reports of Condition and
Income. This optional statement will be made available to the public, along
with the publicly available data in the Reports of Condition and Income, in
response to any request for individual bank report data. However, the
information reported in column A and in all of Memorandum item 1 of Schedule
RC-N is regarded as confidential and will not be released to the public.
BANKS CHOOSING TO SUBMIT THE NARRATIVE STATEMENT SHOULD ENSURE THAT THE
STATEMENT DOES NOT CONTAIN THE NAMES OR OTHER IDENTIFICATIONS OF INDIVIDUAL
BANK CUSTOMERS, REFERENCES TO THE AMOUNTS REPORTED IN THE CONFIDENTIAL ITEMS
IN SCHEDULE RC-N, OR ANY OTHER INFORMATION THAT THEY ARE NOT WILLING TO HAVE
MADE PUBLIC OR THAT WOULD COMPROMISE THE PRIVACY OF THEIR CUSTOMERS. Banks
choosing not to make a statement may check the "No comment" box below and
should make no entries of any kind in the space provided for the narrative
statement; i.e., DO NOT enter in this space such phrases as "No statement,"
"Not applicable," "N/A," "No comment," and "None."
The optional statement must be entered on this sheet. The statement should
not exceed 100 words. Further, regardless of the number of words, the
statement must not exceed 750 characters, including punctuation, indentation,
and standard spacing between words and sentences. If any submission should
exceed 750 characters, as defined, it will be truncated at 750 characters with
no notice to the submitting bank and the truncated statement will appear as the
bank's statement both on agency computerized records and in computer-file
releases to the public.
All information furnished by the bank in the narrative statement must be
accurate and not misleading. Appropriate efforts shall be taken by the
submitting bank to ensure the statement's accuracy. The statement must be
signed, in the space provided below, by a senior officer of the bank who
thereby attests to its accuracy.
If, subsequent to the original submission, material changes are submitted for
the data reported in the Reports of Condition and Income, the existing
narrative statement will be deleted from the files, and from disclosure; the
bank, at its option, may replace it with a statement, under signature,
appropriate to the amended data.
The optional narrative statement will appear in agency records and in release
to the public exactly as submitted (or amended as described in the preceding
paragraph) by the management of the bank (except for the truncation of
statements exceeding the 750-character limit described above). THE STATEMENT
WILL NOT BE EDITED OR SCREENED IN ANY WAY BY THE SUPERVISORY AGENCIES FOR
ACCURACY OR RELEVANCE. DISCLOSURE OF THE STATEMENT SHALL NOT SIGNIFY THAT ANY
FEDERAL SUPERVISORY AGENCY HAS VERIFIED OR CONFIRMED THE ACCURACY OF THE
INFORMATION CONTAINED THEREIN. A STATEMENT TO THIS EFFECT WILL APPEAR ON ANY
PUBLIC RELEASE OF THE OPTIONAL STATEMENT SUBMITTED BY THE MANAGEMENT OF THE
REPORTING BANK.
__________________________________________________________________________
No comment |X| (RCON 6979) | c471 | C472 |<-
BANK MANAGEMENT STATEMENT (please type or print clearly):
(TEXT 6980)
/s/__Gero DeRosa_______________________________ ___7/25/96________
Signature of Executive Officer of Bank Date of Signature
35
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