<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED MAY 10, 1994
$150,000,000
BANKERS TRUST NEW YORK CORPORATION
7 1/2% SUBORDINATED NOTES DUE NOVEMBER 15, 2015
----------------
Interest on the Offered Notes is payable by Bankers Trust New York
Corporation (the "Corporation") semi-annually on May 15 and November 15 in
each year, beginning May 15, 1996, and the Offered Notes will mature on
November 15, 2015. The Offered Notes will be unsecured and subordinated as
described herein under "Certain Terms of the Offered Notes--Subordination."
The Offered Notes may not be redeemed prior to maturity. Payment of the
principal of the Offered Notes may be accelerated only in the case of certain
events involving the bankruptcy, insolvency or reorganization of the
Corporation. There is no right of acceleration in the case of a default in the
performance of any covenant of the Corporation, including the payment of
principal or interest. See "Description of Debt Securities" in the Prospectus
accompanying this Prospectus Supplement.
The Offered Notes will be represented by Global Securities registered in the
name of the nominee of The Depository Trust Company, New York, New York
("DTC"), which will act as the Depository. Interests in the Offered Notes
represented by Global Securities will be shown on, and transfers thereof will
be effected only through, records maintained by the Depository and its direct
and indirect participants. Except as described herein, Offered Notes in
definitive form will not be issued. Settlement for the Offered Notes will be
made in immediately available funds. The Offered Notes will trade in the
Depository's Same-Day Funds Settlement System and secondary market trading
activity for the Offered Notes will therefore settle in immediately available
funds. All payments of principal and interest will be made by the Corporation
in immediately available funds or the equivalent. See "Certain Terms of the
Offered Notes--Same-Day Settlement and Payment."
----------------
THE OFFERED NOTES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT
OR THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNTS(2) CORPORATION(1)(3)
--------- ------------ -----------------
<S> <C> <C> <C>
Per Offered Note................. 99.569% .875% 98.694%
Total............................ $149,353,500 $1,312,500 $148,041,000
</TABLE>
(1) Plus accrued interest from November 15, 1995, if any.
(2) The Corporation has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(3) Before deduction of expenses payable by the Corporation estimated at
$100,000.
----------------
The Offered Notes offered hereby are offered severally by the Underwriters,
as specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that the
Offered Notes will be ready for delivery in book-entry form only through the
facilities of The Depository Trust Company in New York, New York, on or about
November 15, 1995, against payment therefor in immediately available funds.
GOLDMAN, SACHS & CO.
BT SECURITIES CORPORATION
LEHMAN BROTHERS
UBS SECURITIES INC.
----------------
The date of this Prospectus Supplement is November 10, 1995.
<PAGE>
BANKERS TRUST NEW YORK CORPORATION
GENERAL
Bankers Trust New York Corporation (the "Corporation") is a bank holding
company, incorporated under the laws of the State of New York in 1965. At
September 30, 1995, the Corporation had consolidated total assets of $103.9
billion. The Corporation's principal banking subsidiary is Bankers Trust
Company ("Bankers"). Bankers, founded in 1903, is among the largest commercial
banks in New York City and the United States, based on consolidated total
assets. The Corporation concentrates its financial and managerial resources on
selected markets and services its clients by meeting their needs for
financing, advisory, processing and sophisticated risk management solutions.
The core organizational units of the Corporation are the Global Investment
Bank, Global Markets Proprietary, Global Investment Management, Global
Emerging Markets and Global Assets. Other business activities include real
estate finance and principal investing. The Corporation also conducts its own
proprietary operations. Among the institutional market segments served are
corporations, banks, other financial institutions, governments and agencies,
retirement plans, not-for-profit organizations, wealthy individuals,
foundations, private companies and individual investors. Bankers originates
loans and other forms of credit, accepts deposits, arranges financings and
provides numerous other commercial banking and financial services. Bankers
provides a broad range of financial advisory services to its clients. It also
engages in the proprietary trading of currencies, securities, derivatives and
commodities.
The Corporation is a legal entity separate and distinct from its
subsidiaries, including Bankers. There are various legal limitations governing
the extent to which the Corporation's banking subsidiaries may extend credit,
pay dividends or otherwise supply funds to, or engage in transactions with,
the Corporation or certain of its other subsidiaries. The rights of the
Corporation to participate in any distribution of assets of any subsidiary
upon its dissolution, winding-up, liquidation or reorganization or otherwise
are subject to the prior claims of creditors of that subsidiary, except to the
extent that the Corporation may itself be a creditor of that subsidiary and
its claims are recognized. Claims on the Corporation's subsidiaries by
creditors other than the Corporation include long-term debt and substantial
obligations with respect to deposit liabilities, trading liabilities, federal
funds purchased, securities sold under repurchase agreements and commercial
paper, as well as various other liabilities.
The Corporation's principal executive offices are located at 280 Park
Avenue, New York, New York 10017 and its telephone number is (212) 250-2500.
CONSOLIDATED RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
------------------------ -------------
1990 1991 1992 1993 1994 1995
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Excluding Interest on Deposits....... 1.30 1.40 1.44 1.71 1.28 1.02
Including Interest on Deposits....... 1.16 1.22 1.28 1.48 1.21 1.02
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income (loss) before income taxes, cumulative effects of accounting changes
and equity in undistributed income of unconsolidated subsidiaries and
affiliates, plus fixed charges excluding capitalized interest. Fixed charges
represent all interest expense (ratios are presented both excluding and
including interest on deposits), the portion of net rental expense which is
deemed representative of the interest factor, the amortization of debt
issuance expense and capitalized interest.
S-2
<PAGE>
CONSOLIDATED RESULTS OF OPERATIONS
In the third quarter of 1995, the Corporation earned $155 million, or $1.72
primary earnings per share. Return on average common equity for the third
quarter of 1995 was 14%. The Corporation earned $91 million, or $.98 primary
earnings per share for the quarter ended June 30, 1995. In the third quarter
of 1994, the Corporation earned $169 million, or $1.98 primary earnings per
share.
REVENUE
Net interest revenue totaled $204 million, down $60 million, or 23%, from
the third quarter of 1994 and down $18 million, or 8%, from the second quarter
of 1995. The third quarter of 1995 included $20 million of trading-related net
interest revenue, down $92 million and $37 million from the third quarter of
1994 and second quarter of 1995, respectively. A significant portion of the
Corporation's trading and risk management activities involve positions in
interest rate instruments and related derivatives. The revenue from these
activities can periodically shift between trading and net interest, depending
on a variety of factors, including risk management strategies. Therefore, the
Corporation views trading revenue and trading-related net interest revenue
together, which are presented below.
<TABLE>
<CAPTION>
TRADING-
RELATED
NET
TRADING INTEREST
REVENUE REVENUE TOTAL
------- -------- -----
(IN MILLIONS)
<S> <C> <C> <C>
Third Quarter 1995................................. $257 $ 20 $277
Second Quarter 1995................................ $ 79 $ 57 $136
Third Quarter 1994................................. $278 $112 $390
</TABLE>
Although the third quarter results were below those of the same period in
1994, the Corporation believes that the doubling of combined trading revenue
and trading-related net interest revenue from the second quarter of 1995 is
evidence of a transition towards improvement in profitability. The third
quarter's results were primarily attributable to higher revenue from both
client-related and proprietary trading in foreign exchange markets and
improvement in performance of the Corporation's client derivatives business.
Third quarter trading results in the emerging markets of Asia and Latin
America were comparable to the second quarter of 1995, but were lower than the
prior year's strong results.
Fiduciary and funds management revenue totaled $174 million for the third
quarter, down $14 million, or 7%, from the same period last year. The decrease
in revenue was due primarily to a decline in transaction volumes in global
fiduciary services. The $174 million of revenue for the third quarter was up
$8 million, or 5%, from the second quarter of 1995. This increase was
attributable to higher fiduciary revenue from retirement services and
securities lending activities.
Fees and commissions of $152 million in the third quarter of 1995 decreased
by $11 million, or 7%, from the third quarter of 1994. Corporate finance fees
of $74 million decreased by $2 million, or 3%, from the same period last year.
Lower revenue from commercial banking and securities underwriting fees were
partially offset by higher revenue from financial advisory and loan
syndication activities. Compared with this year's second quarter, fees and
commissions were down $59 million, or 28%, as corporate finance fees decreased
by $53 million, or 42%, as a result of lower revenue from loan syndication and
private placement fees.
The Corporation's gains on securities available for sale were $10 million
for the third quarter, compared with $28 million in the prior year's third
quarter and $17 million in the second quarter of 1995.
Other noninterest revenue totaled $162 million for the third quarter, up
$112 million from the prior year's quarter. The largest component of this
increase was an $81 million rise in net revenue from client-related equity
investment transactions, as the 1995 third quarter included a $62 million gain
on
S-3
<PAGE>
the sale of a portion of the Corporation's merchant banking investment in
Northwest Airlines Corporation. Also contributing to the increase in other
noninterest revenue was higher insurance premium revenue from operations in
Chile. The 1994 third quarter had included charges related to the funds
management business. The $162 million of other noninterest revenue for the
third quarter of 1995 was up $48 million, or 42%, from the second quarter of
1995, primarily as a result of the above-mentioned net revenue from equity
investment transactions.
EXPENSES
Total noninterest expenses of $728 million in the third quarter of 1995
increased by $15 million, or 2%, from the third quarter of 1994. Incentive
compensation and employee benefits expense decreased $10 million, or 5%.
Salaries expense decreased $4 million, or 2%, from the third quarter of 1994,
mostly due to a 2% decrease in the average number of employees. The number of
full time staff at September 30, 1995 was 13,808, a net decrease of 721 from
December 31, 1994. Management has implemented expense reduction programs
designed to reduce overall operating expenses--principally noninterest
expenses before bonus, policyholder benefits and minority interest. The
Corporation previously announced that it would be reducing these expenses, as
compared to the annualized fourth quarter 1994 amounts, by approximately $200
million in 1995 and approximately $275 million in 1996.
All other expenses totalled $345 million for the 1995 third quarter, up $29
million, or 9%, from last year's third quarter. The provision for policyholder
benefits and professional fees accounted for this increase.
PROVISION AND ALLOWANCE FOR CREDIT LOSSES
The provision for credit losses was $7 million for the 1995 third quarter,
compared with $17 million in the prior year's third quarter and no provision
in the second quarter of 1995. Net charge-offs for the 1995 third quarter were
$218 million, compared with $28 million a year ago.
The 1995 third quarter included leveraged derivative contract charge-offs of
$205 million against the allowance for credit losses. During the fourth
quarter of 1994, $423 million of leveraged derivative contracts that had been
reclassified as receivables in the loan portfolio were placed on a cash basis.
Of this amount, $72 million was charged off in the fourth quarter of 1994
leaving a balance of $351 million. Since then some of these receivables have
been satisfactorily settled. However, in line with the Corporation's credit
policies, a $205 million portion of the remaining balance was charged off in
the third quarter of 1995.
Largely as a result of this action, cash basis loans decreased by $173
million, or 19%, to $752 million during the third quarter. The allowance for
credit losses at September 30, 1995, was $1.032 billion, representing 137% of
cash basis loans.
The allowance for credit losses is available for credit losses arising from
the Corporation's portfolio, which is comprised of loans, credit-related
commitments, derivatives and other financial instruments. In the opinion of
management, the allowance, when taken as a whole, is adequate to absorb
reasonably estimated credit losses inherent in the Corporation's portfolio, as
defined above.
RECENT DEVELOPMENTS
On October 19, 1995, the Corporation announced that Frank N. Newman, the
former Deputy Secretary of the Treasury, had been elected president of the
Corporation and Bankers and that he would assume the chief executive
responsibilities on January 1, 1996.
On March 13, 1995, Standard and Poor's Rating Group announced that it had
revised the ratings outlook of the Corporation to negative from stable. On
June 14, 1995, Moody's Investors Service, Inc. ("Moody's") lowered the
Corporation's senior debt rating to A2 from A1, its subordinated debt rating
to A3 from A2 and its preferred stock rating to "a2" from "a1." On October 13,
1995, Moody's announced that it had revised the ratings outlook of the
Corporation to negative from stable.
S-4
<PAGE>
Following the sharp increase in interest rates during the first quarter of
1994, various counterparties that had entered into leveraged derivative
transactions with certain subsidiaries of the Corporation experienced losses
and some of those counterparties have made claims against the Corporation. The
Corporation has settled some of the claims made by certain counterparties and
is contesting allegations made by others. In the fourth quarter of 1994,
Procter & Gamble brought a lawsuit against Bankers. In the first quarter of
1995 the suit was amended to include BT Securities Corporation, and in the
third quarter of 1995, the suit was further amended to add claims under Title
IX of the Organized Crime Control Act of 1970. The suit seeks to void and
rescind two interest rate swap transactions entered into with Bankers and
claims $195.5 million in compensatory damages and unspecified punitive
damages. There can be no assurance that there will not be other such actions
or claims in the future.
On December 22, 1994, BT Securities Corporation ("BT Securities"), a
subsidiary of the Corporation, entered into a settlement agreement with the
Securities and Exchange Commission (the "SEC") and the Commodity Futures
Trading Commission (the "CFTC") concerning all investigations of the
Corporation and its subsidiaries by those agencies with respect to the conduct
of its privately negotiated over-the-counter derivatives (the "Derivatives")
business. As part of that settlement, the SEC and the CFTC agreed not to
further pursue Bankers Trust related entities concerning Derivatives matters
prior to the settlement date (although they did reserve the right to pursue
individuals), and BT Securities paid $10 million in civil penalties and agreed
to and has retained independent consultants to examine its conduct of the
Derivatives business. The Corporation also has agreed to implement the
consultants' recommendations.
The Corporation, Bankers and BT Securities have also entered into a Written
Agreement with the Federal Reserve Bank of New York and a Memorandum of
Understanding with the New York State Banking Department concerning the
Corporation's leveraged derivative transactions business, both of which call
for an independent counsel review.
The Corporation cannot predict the effect on the derivatives business
generally, or the Corporation's derivatives business in particular, of these
events or of the current legislative, regulatory and media attention being
given to the derivatives industry.
Details with respect to the foregoing are set forth in the Corporation's
Annual Report on Form 10-K for the year ended December 31, 1994, which is
incorporated herein by reference.
S-5
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA AND OTHER INFORMATION
The following selected consolidated financial data at and for each of the
three years ended December 31, 1994, has been derived from and is qualified in
its entirety by the detailed financial information and consolidated financial
statements of the Corporation included in its Annual Report on Form 10-K for
the year ended December 31, 1994 ("Form 10-K"), which is incorporated herein
by reference.
The consolidated financial data at and for each of the nine months ended
September 30, 1994 and 1995, is unaudited but, in the opinion of management,
all material adjustments necessary for a fair presentation of its results of
operation for such periods have been made. All such adjustments were of a
normal recurring nature. The results of the nine months ended September 30,
1995, are not necessarily indicative of the results for the full year or any
other interim period.
<TABLE>
<CAPTION>
AT OR FOR THE AT OR FOR THE
YEAR ENDED NINE MONTHS ENDED
DECEMBER 31, SEPTEMBER 30,
------------------------- ------------------
1992 1993 1994 1994 1995
------- ------- ------- -------- --------
($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
CONDENSED CONSOLIDATED STATEMENT
OF INCOME:
Interest revenue............... $ 4,219 $ 4,436 $ 5,030 $ 3,673 $ 4,429
Interest expense............... 3,072 3,122 3,858 2,730 3,821
------- ------- ------- -------- --------
Net interest revenue........... 1,147 1,314 1,172 943 608
Provision for credit losses.... 225 93 25 17 21
------- ------- ------- -------- --------
Net interest revenue after pro-
vision for credit losses...... 922 1,221 1,147 926 587
Noninterest revenue............ 2,331 3,364 2,473 1,849 1,684
Noninterest expenses........... 2,347 3,035 2,751 2,042 2,140
------- ------- ------- -------- --------
Income before income taxes and
cumulative effects of account-
ing changes................... 906 1,550 869 733 131
Income taxes................... 267 480 254 219 42
------- ------- ------- -------- --------
Income before cumulative ef-
fects of accounting changes... 639 1,070 615 514 89
Cumulative effects of account-
ing changes(1)................ 446 (75) -- -- --
------- ------- ------- -------- --------
Net income..................... $ 1,085 $ 995 $ 615 $ 514 $ 89
======= ======= ======= ======== ========
Net income applicable to common
stock......................... $ 1,055 $ 972 $ 587 $ 492 $ 53
======= ======= ======= ======== ========
PER COMMON SHARE DATA:
Primary earnings per share
Income before cumulative ef-
fects of accounting changes... $ 7.23 $ 12.40 $ 7.17 $ 5.97 $ .66
Net income..................... $ 12.53 $ 11.51 $ 7.17 $ 5.97 $ .66
Fully diluted earnings per
share
Income before cumulative ef-
fects of accounting changes... $ 7.22 $ 12.29 $ 7.17 $ 5.97 $ .65
Net income..................... $ 12.51 $ 11.41 $ 7.17 $ 5.97 $ .65
Cash dividends declared........ $ 2.88 $ 3.24 $ 3.70 $ 2.70 $ 3.00
--as a percentage of net in-
come(2)....................... 40% 26% 52% 45% 462%
Book value(3).................. $ 43.23 $ 51.90 $ 53.67 $ 54.08 $ 51.72
PROFITABILITY RATIOS:
Return on average common stock-
holders' equity(2)............ 19.52% 26.33% 13.48% 15.11% 1.72%
Return on average total as-
sets(2)....................... .86% 1.25% .59% .66% .11%
CONSOLIDATED BALANCES, END OF
PERIOD:
Trading assets................. $29,908 $48,276 $47,514 $ 54,180 $ 50,364
Loans.......................... $17,318 $15,200 $12,501 $ 12,268 $ 12,786
Total assets................... $72,886 $92,082 $97,016 $107,559 $103,949
Deposits....................... $25,071 $22,776 $24,939 $ 22,308 $ 24,157
Securities sold under repur-
chase agreements.............. $17,451 $23,834 $15,617 $ 25,285 $ 17,899
Other short-term borrowings.... $11,779 $18,992 $18,222 $ 20,817 $ 16,573
Long-term debt................. $ 3,992 $ 5,597 $ 6,455 $ 6,054 $ 8,354
Common stockholders' equity.... $ 3,621 $ 4,284 $ 4,309 $ 4,336 $ 4,196
Total stockholders' equity..... $ 4,121 $ 4,534 $ 4,704 $ 4,731 $ 5,061
CONSOLIDATED CAPITAL RATIOS, END
OF PERIOD:
Common stockholders' equity to
total assets.................. 4.97% 4.65% 4.44% 4.03% 4.04%
Total stockholders' equity to
total assets.................. 5.65% 4.92% 4.85% 4.40% 4.87%
Risk--based capital ratios(4)..
Tier 1 Capital................. 7.75% 8.50% 9.05% 8.22% 8.00%
Total Capital.................. 13.64% 14.46% 14.77% 13.48% 12.90%
Leverage Ratio................. 6.05% 6.28% 5.26% 5.54% 5.50%
EMPLOYEES....................... 12,917 13,571 14,529 14,221 13,808
</TABLE>
- -------
(1) The Corporation adopted the accounting standards for postretirement
benefits other than pensions (SFAS 106) and postemployment benefits (SFAS
112) effective January 1, 1993, and for income taxes (SFAS 109) effective
January 1, 1992.
(2) These figures exclude the cumulative effects of accounting changes
recorded in 1992 and 1993.
(3) This calculation includes the effect of common shares issuable under
deferred stock awards.
(4) The 1992 ratios were not restated in connection with the retroactive
adoption of SFAS 109. At both December 31, 1994 and December 31, 1993, all
three regulatory capital ratios excluded any benefit from the adoption of
SFAS 115. Risk-based capital ratios at September 30, 1995 are preliminary.
S-6
<PAGE>
CERTAIN TERMS OF THE OFFERED NOTES
GENERAL
The Corporation's 7 1/2% Subordinated Notes due November 15, 2015 offered
hereby (the "Offered Notes") will be limited to $150,000,000 aggregate
principal amount and will mature on November 15, 2015. The Offered Notes may
not be redeemed prior to stated maturity and are not entitled to any sinking
fund. The Offered Notes will be issued pursuant to an Indenture, dated as of
April 1, 1992, between the Corporation and Marine Midland Bank (formerly
Marine Midland Bank, N.A.), as Trustee (the "Trustee"), as supplemented by the
First Supplemental Indenture thereto, dated as of January 15, 1993, between
the Corporation and the Trustee (collectively, the "Subordinated Indenture").
The Offered Notes will bear interest at the rate of 7 1/2% per annum from
November 15, 1995, payable semi-annually on May 15 and November 15 in each
year, beginning on May 15, 1996, to the persons in whose names the Offered
Notes (or any predecessor Offered Notes) are registered at the close of
business on the May 1 and November 1 next preceding such interest payment
date.
The Offered Notes will be issued in fully registered form, in denominations
of $1,000 and integral multiples of $1,000 in excess thereof. The paying
agent, registrar and transfer agent for the Offered Notes will be the
corporate trust department of Bankers in The City of New York.
Reference should be made to the Prospectus for a description of other terms
of the Offered Notes and the information contained herein concerning the
Offered Notes is qualified by reference to the provisions of the Indenture,
including the definitions therein of certain terms. See "Description of Debt
Securities." Defined terms used but not defined in this Prospectus Supplement
have the meanings ascribed to them in the Prospectus.
BOOK-ENTRY SYSTEM
The Offered Notes will be issued in the form of one or more fully registered
Global Securities (collectively, the "Global Security"), which will be
deposited with, or on behalf of, The Depository Trust Company, New York, New
York ("DTC"), as depository for the Global Security (the "Depository"), and
registered in the name of DTC's nominee. Transfers or exchanges of beneficial
interests in the Global Security may be effected only through a participating
member of DTC. Under certain limited circumstances Offered Notes may be issued
in certificated form in exchange for the Global Security. See "Book-Entry
Securities" in the Prospectus accompanying this Prospectus Supplement. In the
event that Offered Notes are issued in certificated form, such Offered Notes
may be transferred or exchanged at the offices described in the second
following paragraph.
Payment of principal of, and interest on, Offered Notes registered in the
name of DTC or its nominee will be made to DTC or its nominee, as the case may
be, as the registered owner of the Global Security. None of the Corporation,
the Trustee, any Paying Agent or any other agent of the Corporation or the
Trustee will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in the Global Security or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
In the event that Offered Notes are issued in certificated form, principal
and interest will be payable, the transfer of the Offered Notes will be
registrable and Offered Notes will be exchangeable for Offered Notes bearing
identical terms and provisions at the office of the agent of the Corporation
in The City of New York designated for such purpose, provided that payment of
interest may be made at the option of the Corporation by check mailed to the
address of the person entitled thereto.
S-7
<PAGE>
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Offered Notes will be made by the Underwriters in
immediately available funds. All payments of principal and interest will be
made by the Corporation in immediately available funds or the equivalent, so
long as the Depository continues to make its Same-Day Funds Settlement System
available to the Corporation.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, the Offered
Notes will trade in the Depository's Same-Day Funds Settlement System, and
secondary market trading activity in the Offered Notes will therefore be
required by the Depository to settle in immediately available funds. No
assurance can be given as to the effect, if any, of settlement in immediately
available funds on trading activity in the Offered Notes.
SUBORDINATION
THE OFFERED NOTES WILL BE SUBJECT TO THE SUBORDINATION PROVISIONS AS SET
FORTH IN THE SUBORDINATED INDENTURE AND DESCRIBED IN "DESCRIPTION OF DEBT
SECURITIES--SUBORDINATION OF SUBORDINATED DEBT SECURITIES" IN THE PROSPECTUS
AS SUPPLEMENTED BELOW.
For the purposes of the Offered Notes, "Existing Subordinated Indebtedness"
means the Corporation's 7 1/2% Subordinated Notes due 2010, 6.00% Subordinated
Notes due October 15, 2008, 7.50% Convertible Capital Securities due 2033, 7
5/8% Convertible Capital Securities due 2033, Subordinated LIBOR/CMT Floating
Rate Debentures due 2003, Subordinated Floating Rate Notes due 2005,
Subordinated Constant Maturity Treasury Floating Rate Debentures due 2003,
7.25% Subordinated Debentures due January 15, 2003, Subordinated Floating Rate
Notes due 2002, 7 1/8% Subordinated Debentures due July 31, 2002, 8 1/8%
Subordinated Debentures due May 15, 2002, 7.50% Subordinated Debentures due
January 15, 2002, 9.00% Subordinated Debentures due August 1, 2001, 9.40%
Subordinated Debentures due March 1, 2001, 9.50% Subordinated Debentures due
June 14, 2000, Zero Coupon Subordinated Yen Notes due 1997-2004, Subordinated
Floating Rate Notes due 2004, 9.20% Subordinated Capital Notes due July 15,
1999, Subordinated Money Market Capital Notes, Series A, B and C due 1999, 8%
Subordinated Debentures due March 15, 1997, 8 1/4% Subordinated Debentures due
July 2, 1996, 8 1/8% Subordinated Notes due 2002, 8 1/4% Subordinated Notes
due 2005 and Subordinated Yen Loan due 2005.
As of September 30, 1995, Senior Indebtedness and Other Financial
Obligations of the Corporation aggregated approximately $14 billion.
The Subordinated Indenture does not limit or prohibit the incurrence of
additional Senior Indebtedness, which may include indebtedness that is senior
to the Offered Notes but subordinate to other obligations of the Corporation,
including obligations of the Corporation in respect of Other Financial
Obligations.
EXPERTS
The consolidated financial statements of the Corporation for the year ended
December 31, 1994, appearing in the Annual Report on Form 10-K for the year
ended December 31, 1994, and incorporated by reference in this Prospectus
Supplement, the accompanying Prospectus and the Registration Statement, have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
auditing and accounting.
VALIDITY OF OFFERED NOTES
The validity of the Offered Notes will be passed upon for the Corporation by
Gordon S. Calder, Jr., Esq., a Managing Director and Counsel of Bankers, and
for the Underwriters by White & Case, New York, New York. White & Case
performs services for the Corporation from time to time. Mr. Calder has an
interest in a number of shares equal to less than 0.02 percent of the
Corporation's outstanding common stock. The foregoing supersedes "Validity of
Offered Securities" in the Prospectus.
S-8
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Corporation has agreed to sell to each of the Underwriters named below,
and each of the Underwriters has severally agreed to purchase, the principal
amount of the Offered Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
UNDERWRITER OFFERED NOTES
----------- -------------
<S> <C>
Goldman, Sachs & Co. .......................................... $ 37,500,000
BT Securities Corporation...................................... 37,500,000
Lehman Brothers Inc. .......................................... 37,500,000
UBS Securities Inc. ........................................... 37,500,000
------------
Total........................................................ $150,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all of the Offered Notes, if
any are taken.
The Underwriters propose to offer the Offered Notes in part directly to the
public at the initial public offering price set forth on the cover page of
this Prospectus Supplement and in part to certain securities dealers at such
price less a concession of 0.50% of the principal amount of the Offered Notes.
The Underwriters may allow, and such dealers may reallow, a concession not to
exceed 0.25% of the principal amount of the Offered Notes to certain brokers
and dealers. After the Offered Notes are released for sale to the public, the
offering price and other selling terms may from time to time be varied by the
Underwriters.
The Offered Notes are a new issue of securities with no established trading
market. The Corporation has been advised by the Underwriters that the
Underwriters intend to make a market in the Offered Notes but are not
obligated to do so and may discontinue market making at any time without
notice. No assurance can be given as to the liquidity of the trading market
for the Offered Notes.
The Corporation has agreed to indemnify the several Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933.
This Prospectus Supplement and the accompanying Prospectus may also be
delivered in connection with sales of the Offered Notes by affiliates of the
Corporation that have acquired such Offered Notes.
Underwriters and certain of their associates and affiliates may be customers
of (including borrowers from), engage in transactions with, and/or perform
services for the Corporation and its subsidiaries (including Bankers) in the
ordinary course of business.
BT Securities is a wholly owned subsidiary of the Corporation. The
underwriting arrangements for this offering comply with the requirements of
Schedule E of the By-laws of the National Association of Securities Dealers,
Inc. ("NASD") regarding a NASD member firm's underwriting securities of an
affiliate.
S-9
<PAGE>
PROSPECTUS
- ----------
U.S.$500,000,000
LOGO BANKERS TRUST NEW YORK CORPORATION
DEBT SECURITIES AND WARRANTS
Bankers Trust New York Corporation (the "Corporation") may offer from time to
time up to U.S.$500,000,000 aggregate public offering price (or net proceeds,
in the case of debt securities issued at an original issue discount), or its
equivalent (based on the applicable exchange rate at the time of offering) in
such foreign currencies, or units of two or more currencies, as shall be
designated by the Corporation at the time of offering, of one or more series of
debt securities (the "Debt Securities"); warrants entitling the holders thereof
to purchase Debt Securities or other debt obligations of the Corporation or
another issuer ("Warrant Debt Securities") (the "Debt Warrants"); warrants
entitling the holders thereof to receive from the Corporation, upon exercise,
an amount in cash determined by reference to decreases or increases in the
level of a specified stock or security index or the value of a specified stock
or other debt or equity security or a portfolio of specified stocks or other
debt or equity securities (which may, in each case, be based on U.S. or foreign
stocks or securities or a combination thereof) (the "Index Warrants"); warrants
entitling the holders thereof to receive from the Corporation, upon exercise,
the cash value of the right to purchase or to sell a specified amount of one
foreign currency or unit of two or more currencies for a specified amount of a
different currency or unit of two or more currencies, each as shall be
designated by the Corporation at the time of offering (the "Currency
Warrants"); and warrants entitling the holders thereof to receive from the
Corporation, upon exercise, an amount in cash determined by reference to
decreases or increases in the yield or closing price of one or more specified
debt instruments issued either by the United States government or by a foreign
government (each, a "Debt Instrument"), in the interest rate or interest rate
swap rate specified in the Prospectus Supplement relating to such warrants
(each, a "Rate"), or in any specified combination of Debt Instruments and/or
Rates (the "Interest Rate Warrants," and with the Debt Warrants, the Index
Warrants and the Currency Warrants, the "Warrants"). The Debt Securities may be
senior debt securities (the "Senior Debt Securities") or subordinated debt
securities (the "Subordinated Debt Securities"). Debt Securities and Warrants
(collectively, the "Offered Securities") will be offered on terms to be
determined at the time of offering.
Each issue of Debt Securities may vary as to aggregate principal or face
amount, maturity date, public offering or purchase price, interest rate or
rates, if any, and timing of payments thereof, provision for redemption, if
any, any terms of conversion or exchange, currencies of denomination or
currencies otherwise applicable thereto and any other terms and method of
distribution. Each issue of Warrants may vary as to number, purchase price,
exercise price and provisions, detachability and any other terms and method of
distribution. The accompanying Prospectus Supplement (the "Prospectus
Supplement") will set forth the specific terms with regard to the particular
Offered Securities in respect of which this Prospectus is being delivered.
The Offered Securities may be offered either separately or together as units
and may be sold by the Corporation directly or through agents or dealers. In
addition, the Offered Securities may be sold to or through underwriting
syndicates led by one or more managing underwriters or through one or more
underwriters acting alone pursuant to offering terms fixed at the time of
offering. The agents, dealers or underwriters in connection with the sale of
any Offered Securities will be set forth in the applicable Prospectus
Supplement.
The Senior Debt Securities, when issued, will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Corporation. The Subordinated
Debt Securities, when issued, will be unsecured and subordinated as described
herein under "Description of Debt Securities--Subordination of Subordinated
Debt Securities." Payment of the principal of the Subordinated Debt Securities
may be accelerated only in the case of certain events involving the bankruptcy,
insolvency or reorganization of the Corporation. There is no right of
acceleration of payment of Subordinated Debt Securities in the case of a
default in the performance of any covenant of the Corporation, including the
payment of principal or interest. See "Description of Debt Securities--Events
of Default--Subordinated Debt Securities."
----------------
THE OFFERED SECURITIES WILL NOT BE DEPOSITS OR OTHER OBLIGATIONS OF A
BANK AND WILL NOT BE INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is May 10, 1994.
<PAGE>
FOR NORTH CAROLINA INVESTORS: 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 OR THE
ACCOMPANYING PROSPECTUS SUPPLEMENT.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information concerning the Corporation can be inspected
and copied at the Commission's office at 450 Fifth Street, N.W., Washington,
D.C. 20549, and the Commission's Regional Offices in New York (Seven World
Trade Center, 13th Floor, New York, New York 10048) and Chicago (500 West
Madison Street, Suite 1400, Chicago, Illinois 60661), and copies of such
material can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. In
addition, such material can be inspected at the offices of the New York Stock
Exchange and the American Stock Exchange on which certain securities of the
Corporation are listed. This Prospectus does not contain all of the information
set forth in the registration statement of which this Prospectus is a part (the
"Registration Statement") that the Corporation has filed with the Commission
under the Securities Act of 1933, as amended (the "Securities Act"), and to
which reference is hereby made.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Corporation hereby incorporates by reference in this Prospectus the
following documents:
(a) The Corporation's Annual Report on Form 10-K (file number 1-5920) for
the year ended December 31, 1993, filed pursuant to Section 13 of the
Exchange Act; and
(b) The Corporation's Current Reports on Form 8-K (file number 1-5920)
dated January 20, March 21 and April 19, 1994, filed pursuant to Section 13
of the Exchange Act.
All documents filed by the Corporation pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Offered Securities shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein or in
any accompanying Prospectus Supplement 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.
Any person who receives a copy of this Prospectus may obtain without charge,
upon written or oral request, a copy of any of the documents incorporated by
reference herein, except for the exhibits to such documents (unless such
exhibits are specifically incorporated by reference herein). Written requests
should be mailed to the Office of the Secretary, Bankers Trust New York
Corporation, 280 Park Avenue, New York, New York 10017. Telephone requests may
be directed to (212) 454-4022.
----------------
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS OR ANY ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE,
SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CORPORATION. THIS PROSPECTUS AND ANY ACCOMPANYING PROSPECTUS
SUPPLEMENT DO NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THOSE TO
WHICH THEY RELATE OR AN OFFER TO ANY PERSON IN ANY JURISDICTION WHERE SUCH AN
OFFER WOULD BE UNLAWFUL OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO. NEITHER THE DELIVERY OF THIS PROSPECTUS
OR ANY ACCOMPANYING PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR
THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
INFORMATION HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF OR THEREOF OR, IN THE CASE OF INFORMATION INCORPORATED HEREIN OR THEREIN
BY REFERENCE, THE DATE OF FILING WITH THE COMMISSION.
2
<PAGE>
BANKERS TRUST NEW YORK CORPORATION
GENERAL
The Corporation is a bank holding company incorporated under the laws of the
State of New York in 1965. At March 31, 1994, the Corporation had consolidated
total assets of $103.7 billion. The Corporation's principal banking subsidiary
is Bankers Trust Company ("Bankers"). Bankers, founded in 1903, is among the
largest commercial banks in New York City and the United States, based on
consolidated total assets. The Corporation concentrates its financial and
managerial resources on selected markets, and services its clients by meeting
their needs for financing, advisory, processing and sophisticated risk
management solutions. The core organizational units of the Corporation are the
Global Investment Bank, Global Markets Proprietary, Global Investment
Management, Global Emerging Markets and Global Assets. Other business
activities include real estate finance and principal investing. The Corporation
also conducts its own proprietary operations. Among the institutional market
segments served are corporations, banks, other financial institutions,
governments and agencies, retirement plans, not-for-profit organizations,
wealthy individuals, foundations, private companies and individual investors.
Bankers originates loans and other forms of credit, accepts deposits, arranges
financings and provides numerous other commercial banking and financial
services. Bankers also provides a broad range of financial advisory services to
its clients and engages in the proprietary trading of currencies, securities,
derivatives and commodities.
The Corporation is a legal entity separate and distinct from its
subsidiaries, including Bankers. There are various legal limitations governing
the extent to which the Corporation's banking subsidiaries may extend credit,
pay dividends or otherwise supply funds to, or engage in transactions with, the
Corporation or certain of its other subsidiaries. The rights of the Corporation
to participate in any distribution of assets of any subsidiary, including
Bankers, upon its dissolution, winding-up, liquidation or reorganization or
otherwise are subject to the prior claims of creditors of that subsidiary,
except to the extent that the Corporation is a creditor of that subsidiary and
its claims are recognized. Claims on the Corporation's subsidiaries by
creditors other than the Corporation include long-term debt and substantial
obligations with respect to deposit liabilities, securities sold, not yet
purchased, federal funds purchased, securities sold under repurchase agreements
and commercial paper, as well as various other liabilities.
The Corporation's principal executive offices are located at 280 Park Avenue,
New York, New York 10017, and its telephone number is (212) 250-2500.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED
------------------------ MARCH 31,
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ------------
<S> <C> <C> <C> <C> <C> <C>
Excluding Interest on Deposits............ 0.67 1.30 1.40 1.44 1.71 1.34
Including Interest on Deposits............ 0.83 1.16 1.22 1.28 1.48 1.26
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income (loss) before income taxes, cumulative effects of accounting changes and
equity in undistributed income of unconsolidated subsidiaries and affiliates,
plus fixed charges excluding capitalized interest. Fixed charges represent all
interest expense (ratios are presented both excluding and including interest on
deposits), the portion of net rental expense that is deemed representative of
the interest factor, the amortization of debt issuance expense and capitalized
interest. For the year ended December 31, 1989, earnings, as defined, did not
cover fixed charges, excluding and including interest on deposits, by $834
million as a result of the 1989 special provision for refinancing country
credit losses of $1.6 billion.
3
<PAGE>
USE OF PROCEEDS
Unless otherwise indicated in the accompanying Prospectus Supplement, the net
proceeds from the sale of the Offered Securities will be used for general
corporate purposes, including investments in, or extensions of credit to, the
Corporation's subsidiaries. Except as described in the accompanying Prospectus
Supplement, specific allocations of the proceeds to such purposes have not been
made, although management will have determined at the date of the accompanying
Prospectus Supplement that funds should be borrowed at that time. The precise
amount and timing of such investments in, or extensions of credit to,
subsidiaries will depend on the subsidiaries' funding requirements and the
availability of other funds. A substantial portion of the net proceeds from the
sale of the Offered Securities may be used to hedge such Offered Securities by
entering into transactions such as currency forwards, futures and options on
futures, over-the-counter or exchange traded options, interest rate swaps,
options on certain interest rates and other transactions relating to the
currency, security, interest rate or index used to hedge the Corporation's
obligations in respect of the Offered Securities. Pending such applications,
such net proceeds may be temporarily invested or applied to the reduction of
short-term indebtedness.
DESCRIPTION OF DEBT SECURITIES
Senior Debt Securities may be issued from time to time in one or more series
under an Indenture, dated as of November 1, 1991, as amended by the First
Supplemental Indenture, dated as of September 1, 1993 (as so supplemented, the
"Senior Indenture"), between the Corporation and The Chase Manhattan Bank
(National Association), as Trustee (the "Senior Trustee"). Subordinated Debt
Securities may be issued from time to time in one or more series under either
an Indenture, dated as of April 1, 1992, as amended by the First Supplemental
Indenture, dated as of January 15, 1993 (as so supplemented, the "First
Subordinated Indenture"), between the Corporation and Marine Midland Bank, as
Trustee (the "First Subordinated Trustee"), or under an indenture (the "Second
Subordinated Indenture," and with the First Subordinated Indenture, the
"Subordinated Indentures"), to be entered into before the first issuance of
securities thereunder, between the Corporation and a trustee to be named in the
Prospectus Supplement applicable to the first series of Debt Securities to be
issued pursuant to such Indenture (the "Second Subordinated Trustee," and with
the First Subordinated Trustee, the "Subordinated Trustees"). The Senior
Indenture and the Subordinated Indentures are sometimes referred to
collectively as the "Indentures," and the Senior Trustee and the Subordinated
Trustees are sometimes referred to collectively as the "Trustees." As used
under this caption, unless the context otherwise requires, "debt securities" in
lower case refers to all debt securities issued or issuable, as the case may
be, under the Indentures, and "Debt Securities" refers to the Debt Securities
covered by this Prospectus and any accompanying Prospectus Supplement. The
statements under this caption are brief summaries of certain provisions
contained in the Indentures, do not purport to be complete, and are qualified
in their entirety by reference to the Indentures, including the definitions
therein of certain terms, copies of which are filed or incorporated by
reference as exhibits to the Registration Statement. The Debt Securities may be
offered either alone or together with other Debt Securities or Warrants.
GENERAL
Each Indenture provides for the issuance of debt securities in one or more
series, and does not limit the principal or face amount of debt securities that
may be issued thereunder.
Reference is made to the accompanying Prospectus Supplement for the following
terms of the Debt Securities being offered hereby: (1) the specific title of
the Debt Securities; (2) whether the Debt Securities are Senior Debt Securities
or Subordinated Debt Securities; (3) the aggregate principal amount of such
Debt Securities; (4) the percentage of their principal amount at which the Debt
Securities will be issued; (5) the date on which the Debt Securities will
mature; (6) whether the Debt Securities will bear interest and, if so, the rate
or rates per annum or the method for determining the rate or rates per annum at
which the Debt Securities will bear interest; (7) any index used to determine
the amount of principal of, and premium, if any,
4
<PAGE>
and interest, if any, on, the Debt Securities; (8) the time or times at which
any such principal, premium or interest will be payable; (9) any provisions
relating to optional or mandatory redemption of the Debt Securities; (10) the
denominations in which the Debt Securities are authorized to be issued; (11)
the place or places at which, the period or periods within which, the price or
prices at which and the terms and conditions, if any, upon which the Debt
Securities may be exchanged for or converted into other securities of the
Corporation, including capital securities; (12) the currency, or unit of two or
more currencies, in which the Debt Securities are denominated, if other than
U.S. dollars, and the currency, or unit of two or more currencies, in which
interest is payable if other than the currency in which the Debt Securities are
denominated; (13) the place or places at which the Corporation will make
payments of principal, premium, if any, and interest, if any, and the method of
such payment; (14) whether the Debt Securities will be issued, in whole or in
part, in the form of one or more Global Debt Securities (as hereinafter
defined) and, in such case, the depository for such Global Debt Security or
Global Debt Securities; (15) the person to whom any Debt Security of such
series will be payable, if other than the person in whose name that Debt
Security (or one or more Predecessor Securities (as defined in the applicable
Indenture)) is registered at the close of business on the Regular Record Date
(as defined in the applicable Indenture) for such interest; (16) the extent to
which, or the manner in which, any interest payable on a Global Debt Security
on an Interest Payment Date (as defined in the applicable Indenture) will be
paid; (17) any additional covenants and Events of Default (as defined in the
applicable Indenture) and the remedies with respect thereto not set forth in
the respective Indenture; and (18) any other specific terms of the Debt
Securities.
SUBORDINATION OF SUBORDINATED DEBT SECURITIES
Unless otherwise indicated in the accompanying Prospectus Supplement, the
Subordinated Debt Securities will be subject to the subordination provisions
set forth in the applicable Subordinated Indenture and described below.
The payment of the principal of, premium, if any, and interest on the
Subordinated Debt Securities will, to the extent set forth in the applicable
Subordinated Indenture, be subordinated in right of payment to the prior
payment in full of all Senior Indebtedness (as defined below). In certain
events of insolvency, the payment of the principal of, and premium, if any, and
interest on, the Subordinated Debt Securities will, to the extent set forth in
the applicable Subordinated Indenture, also be effectively subordinated in
right of payment to the prior payment in full of all Other Financial
Obligations (as defined below). Upon any payment or distribution of assets to
creditors upon any liquidation, dissolution, winding up, reorganization,
assignment for the benefit of creditors, marshalling of assets or any
bankruptcy, insolvency or similar proceedings of the Corporation, the holders
of all Senior Indebtedness will first be entitled to receive payment in full of
all amounts due or to become due thereon before the holders of the Subordinated
Debt Securities will be entitled to receive any payment in respect of the
principal of, premium, if any, or interest on the Subordinated Debt Securities.
If upon any such payment or distribution of assets to creditors, there remain,
after giving effect to such subordination provisions in favor of the holders of
Senior Indebtedness, any amounts of cash, property or securities available for
payment or distribution in respect of Subordinated Debt Securities (as defined
in each Subordinated Indenture, "Excess Proceeds") and if, at such time, any
persons entitled to payment in respect of Other Financial Obligations have not
received payment in full of all amounts due or to become due on or in respect
of such Other Financial Obligations, then such Excess Proceeds will first be
applied to pay or provide for the payment in full of such Other Financial
Obligations before any payment or distribution may be made in respect of the
Subordinated Debt Securities. In the event of the acceleration of the maturity
of any Subordinated Debt Securities, the holders of all Senior Indebtedness
will first be entitled to receive payment in full of all amounts due thereon
before the holders of the Subordinated Debt Securities will be entitled to
receive any payment upon the principal of, premium, if any, or interest on the
Subordinated Debt Securities. No payments on account of principal of, premium,
if any, or interest on the Subordinated Debt Securities or on account of the
purchase or acquisition of Subordinated Debt Securities may be made if there
has occurred and is continuing a default in any payment with respect to Senior
Indebtedness, or if any judicial proceeding is pending with respect to any such
default.
5
<PAGE>
By reason of such subordination in favor of the holders of Senior
Indebtedness, in the event of insolvency, creditors of the Corporation who hold
obligations other than Senior Indebtedness and the Subordinated Debt Securities
may recover less in respect of such obligations, ratably, than holders of
Senior Indebtedness and may recover more in respect of such obligations,
ratably, than the holders of the Subordinated Debt Securities. By reason of the
obligation of the holders of the Subordinated Debt Securities to pay over any
Excess Proceeds to persons entitled to payment in respect of Other Financial
Obligations, in the event of insolvency, holders of Existing Subordinated
Indebtedness (as defined in the applicable Indenture) that are not required to
pay over Excess Proceeds may recover less, ratably, than persons entitled to
payment in respect of Other Financial Obligations and may recover more,
ratably, than the holders of Subordinated Debt Securities.
"Senior Indebtedness," unless otherwise specified with respect to any series
of debt securities, is defined in each Subordinated Indenture as the principal
of, premium, if any, and interest (including interest accruing subsequent to
the commencement of any proceeding for the bankruptcy or reorganization of the
Corporation) on (a) all indebtedness for money borrowed, whether outstanding on
the date of execution of such Subordinated Indenture or thereafter created,
assumed or incurred, except such indebtedness as is by its terms expressly
stated to be not superior in right of payment to the Subordinated Debt
Securities issued under such Subordinated Indenture or to rank pari passu with
such Subordinated Debt Securities or is identified in a Board Resolution or any
indenture supplemental to such Subordinated Indenture as not superior in right
of payment or to rank pari passu with such Subordinated Debt Securities and (b)
any deferrals, renewals or extensions of any such indebtedness for money
borrowed. Senior Indebtedness does not, however, include any obligations on
account of Existing Subordinated Indebtedness (as defined below). The term
"indebtedness for money borrowed," unless otherwise specified with respect to
any series of debt securities, is defined to mean any obligation of, or any
obligation guaranteed by, the Corporation for the repayment of borrowed money,
whether or not evidenced by bonds, debentures, notes or other written
instruments, and any deferred obligation for the payment of the purchase price
of property or assets.
"Existing Subordinated Indebtedness" means, unless otherwise specified with
respect to any series of debt securities, the Corporation's 6.00% Subordinated
Notes due October 15, 2008, 7.50% Convertible Capital Securities due 2033,
Subordinated LIBOR/CMT Floating Rate Debentures due 2003, 7 5/8% Convertible
Capital Securities due 2033, Subordinated Floating Rate Notes due 2005,
Subordinated Constant Maturity Treasury Floating Rate Debentures due 2003,
7.25% Subordinated Debentures due January 15, 2003, Subordinated Floating Rate
Notes due 2002, 7 1/8% Subordinated Debentures due July 31, 2002, 8 1/8%
Subordinated Debentures due May 15, 2002, 7.50% Subordinated Debentures due
January 15, 2002, 9.00% Subordinated Debentures due August 1, 2001, 9.40%
Subordinated Debentures due March 1, 2001, 9.50% Subordinated Debentures due
June 14, 2000, Zero Coupon Subordinated Yen Notes due 1997-2004, 10.20%
Subordinated Debentures due March 15, 1999, 9.20% Subordinated Capital Notes
due July 15, 1999, Subordinated Money Market Capital Notes, Series A, B and C
due 1999, 8% Subordinated Debentures due March 15, 1997, 8 1/4% Subordinated
Debentures due July 2, 1996, and the Corporation's guaranty in respect of the
6.90% Subordinated Notes due March 1, 1995 of Bankers and such other
indebtedness as may be specified in the accompanying Prospectus Supplement.
"Other Financial Obligations" means, unless otherwise specified with respect
to any series of debt securities, all obligations of the Corporation to make
payment pursuant to the terms of financial instruments, such as (i) securities
contracts and foreign currency exchange contracts, (ii) derivative instruments,
such as swap agreements (including interest rate and foreign exchange rate swap
agreements), cap agreements, floor agreements, collar agreements, interest rate
agreements, foreign exchange rate agreements, options, commodity futures
contracts, commodity option contracts, and (iii) in the case of both (i) and
(ii) above, similar financial instruments, other than (A) obligations on
account of Senior Indebtedness and (B) obligations on account of indebtedness
for money borrowed ranking pari passu with or subordinate to the Subordinated
Debt Securities.
The Corporation's obligations under the Subordinated Debt Securities will
rank pari passu in right of payment with each other and with the Existing
Subordinated Indebtedness, subject to the obligations of the
6
<PAGE>
holders of Subordinated Debt Securities to pay over any Excess Proceeds to
persons entitled to payment in respect of Other Financial Obligations as
provided in the applicable Subordinated Indenture.
As of March 31, 1994, Senior Indebtedness and Other Financial Obligations of
the Corporation aggregated approximately $12.0 billion.
The Subordinated Indentures do not limit or prohibit the incurrence of
additional Senior Indebtedness and Other Financial Obligations, which may
include indebtedness that is senior to the Subordinated Debt Securities but
subordinate to other obligations of the Corporation, including obligations of
the Corporation in respect of Other Financial Obligations.
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Debt Securities of a series may be issuable in definitive or global form.
Unless otherwise specified in the applicable Prospectus Supplement, Debt
Securities will be issued in the form of Global Securities (as defined below)
held in book-entry form. See "Book-Entry Securities" below.
Debt Securities may be presented for registration of transfer (with the form
of transfer printed thereon duly executed) at the office of the Security
Registrar (as defined in the applicable Indenture), or at the office of any
transfer agent designated by the Corporation for such purpose with respect to
any series of Debt Securities and referred to in the applicable Prospectus
Supplement, without service charge and upon payment of any taxes and other
governmental charges as described in the applicable Indenture. Such transfer or
exchange will be effected upon the Security Registrar or such transfer agent,
as the case may be, being satisfied with the documents of title and identity of
the person making the request. The Corporation has appointed Bankers as
Security Registrar with respect to both the Senior Debt Securities and the
Subordinated Debt Securities. If a Prospectus Supplement refers to any transfer
agents (in addition to the Security Registrar) initially designated by the
Corporation with respect to any series of Debt Securities, the Corporation may
at any time rescind the designation of any such transfer agent or approve a
change in the location through which any such transfer agent acts, except that
the Corporation will be required to maintain a transfer agent in each Place of
Payment (as defined in the applicable Indenture) for such series. The
Corporation may at any time designate additional transfer agents with respect
to any series of Debt Securities.
In the event of any redemption in part, the Corporation shall not be required
to (i) issue, register the transfer of or exchange any Debt Security during a
period beginning at the opening of business 15 days before the day of mailing
of a notice of redemption of Debt Securities of like tenor and of the series of
which such Debt Security is a part, and ending at the close of business on the
earliest date in which the relevant notice of redemption is deemed to have been
given to all holders of Debt Securities of like tenor and of such series to be
redeemed or (ii) register the transfer of or exchange any Debt Security so
selected for redemption, in whole or in part, except the unredeemed portion of
any Debt Security being redeemed in part.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal of and premium, if any, on any Debt Security will be made only
against surrender to the Paying Agent (as defined in the applicable Indenture)
of such Debt Security. Unless otherwise indicated in the applicable Prospectus
Supplement, principal of, premium, if any, and interest on Debt Securities will
be payable, subject to any applicable laws and regulations, at the office of
such Paying Agent or Paying Agents as the Corporation may designate from time
to time, except that at the option of the Corporation payment of any interest
may be made by check mailed to the address of the person entitled thereto as
such address shall appear in the Security Register (as defined in the
applicable Indenture) with respect to such Debt Securities. Unless otherwise
indicated in an applicable Prospectus Supplement, payment of interest on a Debt
Security on any Interest Payment Date (as defined in the applicable Indenture)
will be made to the person in whose name such Debt
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Security (or Predecessor Security) is registered at the close of business on
the Regular Record Date for such interest.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporate Trust Office (as defined in the applicable Indenture) of Bankers in
The City of New York will be designated as the Corporation's sole Paying Agent
for payments with respect to Debt Securities of each series. Any Paying Agents
outside of the United States and any other Paying Agents in the United States
initially designated by the Corporation for the Debt Securities of any series
will be named in the applicable Prospectus Supplement. The Corporation may at
any time designate additional Paying Agents or rescind the designation of any
Paying Agent or approve a change in the office through which any Paying Agent
acts, except that the Corporation will be required to maintain a Paying Agent
in each Place of Payment for each series of Debt Securities.
All moneys paid by the Corporation to a Paying Agent for the payment of the
principal of, premium, if any, or interest on any Debt Security of any series
and that remain unclaimed at the end of two years after such principal,
premium, if any, or interest shall have become due and payable will be repaid
to the Corporation and the holder of such Debt Security must thereafter look
only to the Corporation for payment of such amounts.
MODIFICATION OF THE INDENTURES
Each Indenture contains provisions that permit the Corporation and the
applicable Trustee, with the consent of the holders of not less than 66 2/3% in
principal amount of the debt securities that are affected by the modification,
to modify the particular Indenture or any supplemental indenture or the rights
of the holders of the debt securities issued under such Indenture. However, no
such modification may, without the consent of the holder of each outstanding
debt security affected thereby, (a) change the stated maturity date of the
principal of, or any installment of principal of or interest on, any such debt
security, (b) reduce the principal amount of, or premium or rate of interest
on, any such debt security, (c) reduce the amount of principal of an original
issue discount debt security payable upon acceleration of the maturity thereof,
(d) change the place or currency of payment of principal of, or premium or
interest on, any such debt security, (e) impair the right to institute suit for
the enforcement of any payment on or with respect to any such debt security, or
(f) reduce the percentage in principal amount of Outstanding Debt Securities
(as defined in such Indenture) of any series the consent of whose holders is
required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of such Indenture or for waiver of certain
defaults.
EVENTS OF DEFAULT
Senior Debt Securities. An Event of Default with respect to Senior Debt
Securities of any series is defined in the Senior Indenture as being: default
for 30 days in payment of any interest on Senior Debt Securities of such
series; default in payment of principal of, or premium, if any, on, Senior Debt
Securities of such series; default for 30 days in payment of any mandatory
sinking fund payment required by the Senior Debt Securities of such series;
default for 90 days after notice in performance of any other covenant in the
Senior Debt Securities of such series or in the Senior Indenture; or certain
events of bankruptcy, insolvency or reorganization. If an Event of Default with
respect to Senior Debt Securities of any series occurs and is continuing, the
Senior Trustee or the holders of not less than 25% in principal or face amount
of the Senior Debt Securities of such series then outstanding may declare the
principal of all such Senior Debt Securities to be due and payable. The
Corporation is required to furnish to the Senior Trustee annually a statement
as to the performance by the Corporation of its obligations under the Senior
Indenture and as to any default in such performance. Under certain
circumstances, any declaration of acceleration with respect to Senior Debt
Securities of any series may be rescinded and past defaults (except, unless
theretofore cured, a default in the payment of principal of, premium, if any,
or interest on the Senior Debt Securities) may be waived by the holders of a
majority in aggregate principal amount of the Senior Debt Securities of such
series then outstanding. The Senior Trustee may withhold notice to the holders
of Senior Debt Securities of any series of
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any continuing default (except in the payment of the principal of, or premium,
if any, or interest on any Senior Debt Securities of such series or in the
payment of any sinking fund installment) if the Senior Trustee considers it in
the interest of holders of such series of Senior Debt Securities to do so.
Subordinated Debt Securities. An Event of Default with respect to
Subordinated Debt Securities of any series is defined in each Subordinated
Indenture as being one of certain events involving a bankruptcy, insolvency or
reorganization of the Corporation. If an Event of Default with respect to
Subordinated Debt Securities of any series shall have occurred and be
continuing, either the applicable Subordinated Trustee or the holders of not
less than 25% in aggregate principal or face amount of the Subordinated Debt
Securities of such series then outstanding may declare the principal of such
Subordinated Debt Securities to be due and payable immediately. The Corporation
is required to furnish to each Subordinated Trustee annually a statement as to
the performance by the Corporation of its obligations under the applicable
Subordinated Indenture and as to any default in such performance. Under certain
circumstances, any declaration of acceleration with respect to Subordinated
Debt Securities of any series may be rescinded and past defaults (except,
unless theretofore cured, a default in the payment of principal of, premium, if
any, or interest on such Subordinated Debt Securities) may be waived by the
holders of a majority in aggregate principal amount of the Subordinated Debt
Securities of such series then outstanding. Each Subordinated Trustee may
withhold notice to the holders of the Subordinated Debt Securities of any
series issued under the applicable Indenture of any continuing default (except
in the payment of the principal of, or premium, if any, or interest on any
Subordinated Debt Securities of such series or in the payment of any sinking
fund installment) if such Subordinated Trustee considers it in the interest of
the holders of such series of Subordinated Debt Securities to do so.
The Subordinated Indentures do not provide for any right of acceleration of
the payment of the principal of a series of Subordinated Debt Securities upon a
default in the payment of principal, premium, if any, or interest or a default
in the performance of any covenant or agreement in the Subordinated Debt
Securities of the particular series or in the Subordinated Indenture. In the
event of a default in the payment of interest, principal or premium, if any,
the holder of a Subordinated Debt Security (or the Subordinated Trustee on
behalf of the holders of all of the series of Subordinated Debt Securities
affected) may, subject to certain limitations and conditions, seek to enforce
payment of such interest, principal or premium, if any.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
The Corporation has covenanted in the Indentures that it will not merge or
consolidate with any other corporation or sell or convey all or substantially
all of its assets to any person, firm or corporation unless the Corporation is
the continuing corporation, or the successor corporation is a corporation
organized under the laws of the United States of America or a state thereof and
such corporation expressly assumes the obligations under any outstanding debt
securities and the respective Indentures and the Corporation or such successor
corporation is not, immediately after such merger, consolidation, sale or
conveyance, in default in the performance of any of the covenants or conditions
of the respective Indentures. The Indentures do not contain any other covenant
that restricts the Corporation's ability to merge or consolidate with any other
corporation, sell or convey all or substantially all of its assets to any
person, firm or corporation or otherwise engage in restructuring transactions.
Further, the Indentures do not contain any provisions that would provide
protection to holders of Debt Securities against a sudden and dramatic decline
in credit quality resulting from a takeover, recapitalization or similar
restructuring of the Corporation.
TITLE
The Corporation, the Trustees and any agent of the Corporation or the
relevant Trustee may treat the registered owner of any Debt Security as the
absolute owner thereof (whether or not such Debt Security shall be overdue and
notwithstanding any notice to the contrary) for the purpose of making payment
and for all other purposes.
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REPLACEMENT OF DEBT SECURITIES
Any mutilated Debt Security will be replaced by the Corporation at the
expense of the holder upon surrender of such Debt Security to the Trustee. Debt
Securities that are destroyed, lost or stolen will be replaced by the
Corporation at the expense of the holder upon delivery to the relevant Trustee
of evidence of the destruction, loss or theft thereof satisfactory to the
Corporation and the relevant Trustee. In the case of a destroyed, lost or
stolen Debt Security, an indemnity satisfactory to the relevant Trustee and the
Corporation may be required at the expense of the holder of such Debt Security
before a replacement Debt Security will be issued.
GOVERNING LAW
The Indentures and the Debt Securities will be governed by, and construed in
accordance with, the laws of the State of New York.
INFORMATION CONCERNING THE TRUSTEES
Subject to the provisions of the relevant Indenture relating to its duties,
each Trustee will be under no obligation to exercise any of its rights or
powers under such Indenture at the request, order or direction of any of the
holders of debt securities issued thereunder, unless such holders have offered
to such Trustee reasonable indemnity. Subject to such provision for
indemnification, the holders of a majority in principal amount of the debt
securities then outstanding thereunder will have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee under the relevant Indenture, or exercising any trust or power
conferred on such Trustee.
Senior Trustee. Bankers serves as trustee under various indentures for The
Chase Manhattan Corporation, parent company of the Senior Trustee. The Senior
Trustee also serves as trustee under another indenture with the Corporation
relating to other issues of its debt securities. In addition, the Corporation
and Bankers have other relationships arising in the ordinary course of business
with the Senior Trustee.
First Subordinated Trustee. Bankers serves as trustee under an indenture for
an affiliate of the First Subordinated Trustee. In addition, the Corporation
and Bankers have other relationships arising in the ordinary course of business
with the First Subordinated Trustee.
Second Subordinated Trustee. The Second Subordinated Trustee will be named in
the Prospectus Supplement relating to the first series of Subordinated Debt
Securities issued under the Second Subordinated Indenture.
DESCRIPTION OF WARRANTS
The Corporation may issue from time to time, either together with Debt
Securities or other Warrants or separately, one or more series of Debt
Warrants, Currency Warrants, Index Warrants or Interest Rate Warrants. The
Warrants are to be issued under separate warrant agreements (each, a "Warrant
Agreement") to be entered into between the Corporation and a bank or trust
company, as warrant agent (each, a "Warrant Agent"), all as will be set forth
in the applicable Prospectus Supplement. Copies of the forms of Warrant
Agreements relating to Debt Warrants, Currency Warrants, Index Warrants, and
Interest Rate Warrants, including the forms of global certificates representing
such Warrants (the "Warrant Certificates"), are filed as exhibits to the
Registration Statement and incorporated herein by reference. The statements
under this caption are brief summaries of certain provisions contained in the
Warrant Agreements, do not purport to be complete, and are qualified in their
entirety by reference to the forms of such agreements, including the
definitions therein of certain terms, copies of which are filed or incorporated
by reference as exhibits to the Registration Statement.
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DESCRIPTION OF DEBT WARRANTS
General. Unless otherwise specified in the applicable Prospectus Supplement,
each Debt Warrant will entitle the holder of such Warrant to purchase for cash
the principal or face amount of Warrant Debt Securities at the exercise price
set forth in, or determined as set forth in, the applicable Prospectus
Supplement. Unless earlier terminated or cancelled, Debt Warrants may be
exercised at any time up to the close of business on the expiration date set
forth in the applicable Prospectus Supplement. After the close of business on
such expiration date (or such later date to which such expiration date may be
extended by the Corporation), unexercised Debt Warrants will become void.
The applicable Prospectus Supplement will describe the terms of the Debt
Warrants offered thereby, the Warrant Agreement relating to such Debt Warrants
and the Warrant Certificates representing such Debt Warrants, including the
following: (1) the title of such Debt Warrants; (2) the aggregate number of
such issue of Debt Warrants; (3) the initial offering price of such Debt
Warrants; (4) the designation, aggregate face or principal amount, aggregate
price at which such principal or face amount may be purchased upon exercise,
and terms of the Warrant Debt Securities purchasable upon exercise of such Debt
Warrants, including, in the case of Debt Warrants exercisable for Debt
Securities, whether such Debt Securities are Senior Debt Securities or
Subordinated Debt Securities; (5) the circumstances, if any, in which the
exercise price of such Debt Warrants may change; (6) the principal or face
amount of Warrant Debt Securities purchasable upon exercise of each such Debt
Warrant and the price at which such face or principal amount of Warrant Debt
Securities may be purchased upon such exercise; (7) the currency, or unit of
two or more currencies, in which the initial offering price and/or the exercise
price of such Debt Warrants is payable; (8) the minimum number, if any, of such
Debt Warrants that must be exercised at any one time, other than upon automatic
exercise, if any; (9) the maximum number, if any, of such Debt Warrants that
may, subject to election by the Corporation, be exercised by all owners (or by
any person or entity) on any day; (10) any provisions for the automatic
exercise of such Debt Warrants; (11) whether and under what circumstances such
Debt Warrants may be cancelled by the Corporation prior to expiration; (12) any
other procedures and conditions relating to the exercise of such Debt Warrants;
(13) if applicable, the designation and terms of any related Debt Securities or
other Warrants with which such Debt Warrants are issued, including whether such
Debt Securities are Senior Debt Securities or Subordinated Debt Securities and
whether such other Warrants are Debt Warrants, Currency Warrants, Index
Warrants or Interest Rate Warrants, and the number of such Debt Warrants issued
with each such Debt Security or other Warrant; (14) the date, if any, on and
after which such Debt Warrants and any related Debt Securities or other
Warrants will be separately transferable; (15) the date on which the right to
exercise such Debt Warrants will commence and the date on which such right will
expire; (16) the identity of the Warrant Agent under the applicable Warrant
Agreement; (17) any national securities exchange on which such Debt Warrants
will be listed; and (18) any other terms of such Debt Warrants.
Unless otherwise specified in the applicable Prospectus Supplement, Debt
Warrants will be issued in the form of Global Securities held in book-entry
form. See "Book-Entry Securities" below.
Exercise of Debt Warrants. Debt Warrants may be exercised in the manner set
forth in the applicable Prospectus Supplement. Unless otherwise specified in
the applicable Prospectus Supplement, in the case of Debt Warrants held in
book-entry form, as described under "Book-Entry Securities" below, upon receipt
by the Warrant Agent of payment of the exercise price and notice of exercise
and delivery of the applicable Debt Warrants to the account of the Corporation
free on the books of DTC (as defined below), the Corporation will, as soon as
practicable, forward to the holder of such Debt Warrants the Warrant Debt
Securities purchasable upon such exercise. In the case of Debt Warrants held in
definitive form, the Corporation will make available to the Warrant Agent the
Warrant Debt Securities purchasable upon such exercise for delivery to the
holders of such Debt Warrants as soon as practicable upon receipt of payment of
the exercise price and the Warrant Certificate properly completed and duly
executed at the corporate trust office of the applicable Warrant Agent or any
other office indicated in the applicable Prospectus Supplement. If fewer
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than all of the Debt Warrants represented by such Warrant Certificate are
exercised, a new Warrant Certificate will be issued for the remaining number of
Debt Warrants.
Before the exercise of their Debt Warrants, holders of Debt Warrants will not
have any of the rights of holders of the Warrant Debt Securities purchasable
upon such exercise, will not be entitled to payments of principal of, premium,
if any, or interest on, the Warrant Debt Securities purchasable upon such
exercise, and will not have the right to enforce any of the covenants in the
Indenture applicable to such Warrant Debt Securities.
Other Information. Other important information regarding the Debt Warrants is
set forth below under "--Certain Items Applicable to All Warrants" and under
"Book-Entry Securities," "United States Taxation" and "Foreign Currency Risks."
DESCRIPTION OF CURRENCY WARRANTS
General. Currency Warrants may be issued in the form of (i) Currency Warrants
("Currency Put Warrants") entitling the holders thereof to receive from the
Corporation upon exercise the cash settlement value of the right to sell a
specified amount of one foreign currency, or unit of two or more currencies
(the "Base Currency"), for a specified amount of another foreign currency, or
unit of two or more currencies (the "Reference Currency"), (ii) Currency
Warrants ("Currency Call Warrants") entitling the holders thereof to receive
from the Corporation upon exercise the cash settlement value of the right to
purchase a specified amount of a Base Currency for a specified amount of a
Reference Currency, or (iii) any combination of the foregoing.
Unless otherwise provided in the applicable Prospectus Supplement, each
Currency Warrant will entitle the holder thereof to receive from the
Corporation upon exercise the cash settlement value of such Currency Warrant.
Unless earlier terminated or cancelled, Currency Warrants may be exercised at
any time up to the close of business on the expiration date set forth in the
applicable Prospectus Supplement. Certain Currency Warrants will, if specified
in the applicable Prospectus Supplement, entitle the holders thereof to receive
from the Corporation a certain amount upon cancellation of the Currency
Warrants by the Corporation upon the occurrence of specified events. If
specified in the applicable Prospectus Supplement, the Currency Warrants will
be deemed automatically exercised if not exercised by the holder thereof on or
before the expiration date of such Warrants (or such other date as is specified
in the applicable Prospectus Supplement). In addition, if so specified in the
applicable Prospectus Supplement, following the occurrence of an Extraordinary
Event (as defined in the applicable Prospectus Supplement), the cash settlement
value of a Currency Warrant may, at the option of the Corporation, be
determined on a different basis, including in connection with automatic
exercise at expiration.
The applicable Prospectus Supplement will describe the terms of the Currency
Warrants offered thereby, the Warrant Agreement relating to such Currency
Warrants and the Warrant Certificates representing such Currency Warrants,
including the following: (1) the title of such Currency Warrants; (2) whether
such Currency Warrants shall be Currency Put Warrants, Currency Call Warrants,
or any combination thereof; (3) the aggregate number of such issue of Currency
Warrants; (4) the initial offering price of such Currency Warrants; (5) the
exercise price, if any, of such Currency Warrants; (6) the currency, or unit of
two or more currencies, in which the initial offering price, the exercise
price, if any, and/or the cash settlement value of such Currency Warrants is
payable; (7) the Base Currency and Reference Currency for such Currency
Warrants; (8) the formula for determining the cash settlement value of such
Currency Warrants; (9) the circumstances, if any, in which the exercise price,
if any, or the formula for determining the cash settlement value may change;
(10) whether and under what circumstances a maximum expiration value is
applicable upon the expiration or exercise of such Currency Warrants; (11) the
effect or effects, if any, of the occurrence of an Extraordinary Event; (12)
the minimum number, if any, of such Currency Warrants that must be exercised at
any one time, other than upon automatic exercise, if any; (13) the maximum
number, if any, of
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such Currency Warrants that may, subject to election by the Corporation, be
exercised by all owners (or by any person or entity) on any day; (14) any
provisions for the automatic exercise of such Currency Warrants; (15) whether
and under what circumstances such Currency Warrants may be cancelled by the
Corporation prior to expiration; (16) any provisions permitting a holder of
such Currency Warrants to condition any notice of exercise on the absence of
certain specified changes in the values or relative values of the Base Currency
or Reference Currency after the date of exercise; (17) any other procedures and
conditions relating to the exercise of such Currency Warrants; (18) if
applicable, the designation and terms of any related Debt Securities or other
Warrants with which such Currency Warrants are issued, including whether such
Debt Securities are Senior Debt Securities or Subordinated Debt Securities and
whether such other Warrants are Debt Warrants, Currency Warrants, Index
Warrants or Interest Rate Warrants, and the number of such Currency Warrants
issued with each such Debt Security or other Warrant; (19) the date, if any, on
and after which such Currency Warrants and any related Debt Securities or other
Warrants will be separately transferable; (20) the date on which the right to
exercise such Currency Warrants will commence and the date on which such right
will expire; (21) the identity of the Warrant Agent under the applicable
Warrant Agreement; (22) any national securities exchange on which such Currency
Warrants will be listed; and (23) any other terms of such Currency Warrants.
Unless otherwise specified in the applicable Prospectus Supplement, Currency
Warrants will be issued in the form of Global Securities held in book-entry
form. See "Book-Entry Securities" below.
Unless otherwise specified in the applicable Prospectus Supplement, the cash
settlement value (and, if applicable, the amount payable on cancellation) of
the Currency Warrants will be payable in U.S. dollars.
Exercise of Currency Warrants. Currency Warrants may be exercised in the
manner set forth in the applicable Prospectus Supplement. Unless otherwise
specified in the applicable Prospectus Supplement, in the case of Currency
Warrants held in book-entry form, as described under "Book-Entry Securities"
below, upon receipt by the Warrant Agent of payment of the exercise price, if
any, and notice of exercise and delivery of the applicable Currency Warrants to
the account of the Corporation free on the books of DTC, the Corporation will,
as soon as practicable, make payment of the applicable amounts to the account
of the holder of such Currency Warrants specified in the applicable notice of
exercise. In the case of Currency Warrants held in definitive form, the
Corporation will make adequate funds available to the Warrant Agent to make
such payment upon such exercise as soon as practicable upon receipt of payment
of the exercise price, if any, and the applicable Warrant Certificate properly
completed and duly executed at the corporate trust office of the applicable
Warrant Agent or any other office indicated in the applicable Prospectus
Supplement. If fewer than all of the Currency Warrants represented by such
Warrant Certificate are exercised, a new Warrant Certificate will be issued for
the remaining number of Currency Warrants. The holders of Currency Warrants
will not receive any interest on any cash settlement value or amount payable on
cancellation of the Currency Warrants.
Extraordinary Events. If so specified in the applicable Prospectus
Supplement, following the occurrence of an Extraordinary Event, Currency
Warrants may be cancelled by the Corporation, the cash settlement value of such
Currency Warrants may be determined on a different basis than under normal
circumstances, or the exercise or valuation of, or payment for, such Currency
Warrants may be delayed or postponed. Upon cancellation, the holders of such
Currency Warrants will be entitled to receive only the applicable amount
payable on cancellation specified in such Prospectus Supplement. The amount
payable on cancellation may be either a fixed amount or an amount that varies
during the term of the Currency Warrants in accordance with a schedule or
formula as specified in the applicable Prospectus Supplement.
Other Information. Other important information regarding the Currency
Warrants is set forth below under "--Certain Items Applicable to All Warrants"
and under "Book-Entry Securities," "United States Taxation" and "Foreign
Currency Risks."
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DESCRIPTION OF INDEX WARRANTS
General. Index Warrants may be issued in the form of (i) Index Warrants
("Index Put Warrants") entitling the holders thereof to receive from the
Corporation upon exercise an amount in cash determined by reference to
decreases in the level of a specified stock or security index or the value of a
specified stock or other debt or equity security or a portfolio of specified
stocks or other debt or equity securities (the "Index"), (ii) Index Warrants
("Index Call Warrants") entitling the holders thereof to receive from the
Corporation upon exercise an amount in cash determined by reference to
increases in the specified Index, or (iii) any combination of the foregoing.
The Index may be composed of one or more U.S. or foreign stocks, bonds or other
debt or equity securities or a combination thereof (the "Underlying
Securities"), and may be a preexisting U.S. or foreign index compiled and
published by a third party or an index based on one or more such securities
selected by the Corporation solely in connection with the issuance of such
Index Warrants. An Index Warrant will not require or entitle the holder thereof
to purchase or take delivery of or sell or make delivery of any securities
(including Underlying Securities), nor will the Corporation be under any
obligation to, nor will it, purchase or take delivery of or sell or make
delivery of any securities (including Underlying Securities) from or to holders
of the Index Warrants pursuant to the Index Warrants.
Unless otherwise provided in the applicable Prospectus Supplement, each Index
Warrant will entitle the holder thereof to receive from the Corporation upon
exercise the cash settlement value of such Index Warrant. Unless earlier
terminated or cancelled, Index Warrants may be exercised at any time up to the
close of business on the expiration date set forth in the applicable Prospectus
Supplement. Certain Index Warrants will, if specified in the applicable
Prospectus Supplement, entitle the holders thereof to receive from the
Corporation a certain amount upon cancellation of the Index Warrants by the
Corporation upon the occurrence of specified events. If specified in the
applicable Prospectus Supplement, the Index Warrants may be deemed
automatically exercised if not exercised by the holder thereof on or before the
expiration date of such Warrants (or such other date as is specified in the
applicable Prospectus Supplement). In addition, if so specified in the
applicable Prospectus Supplement, following the occurrence of an Extraordinary
Event (as defined in the applicable Prospectus Supplement), the cash settlement
value of an Index Warrant may, at the option of the Corporation, be determined
on a different basis, including in connection with automatic exercise at
expiration.
The applicable Prospectus Supplement will describe the terms of the Index
Warrants offered thereby, the Warrant Agreement relating to such Index Warrants
and the Warrant Certificates representing such Index Warrants, including the
following: (1) the title of such Index Warrants; (2) whether such Index
Warrants shall be Index Put Warrants, Index Call Warrants, or any combination
thereof; (3) the aggregate number of such issue of Index Warrants; (4) the
initial offering price of such Index Warrants; (5) the exercise price, if any,
of such Index Warrants; (6) the currency, or unit of two or more currencies, in
which the initial offering price, the exercise price, if any, and/or the cash
settlement value of such Index Warrants is payable; (7) the Index or Indices
for such Index Warrants, and certain information relating to such Index or
Indices and the Underlying Securities, including, to the extent possible, the
policies of the publisher of the Index, if any, with respect to additions,
deletions and substitutions of such Underlying Securities; (8) the method of
providing for a substitute Index or Indices or otherwise determining any amount
payable with respect to such Index Warrants if any Index changes or ceases to
be made available by its publisher; (9) the formula for determining the cash
settlement value of such Index Warrants; (10) the circumstances, if any, in
which the exercise price, if any, or the formula for determining the cash
settlement value may change; (11) whether and under what circumstances a
maximum expiration value is applicable upon the expiration or exercise of such
Index Warrants; (12) the effect or effects, if any, of the occurrence of an
Extraordinary Event; (13) the minimum number, if any, of such Index Warrants
that must be exercised at any one time, other than upon automatic exercise, if
any; (14) the maximum number, if any, of such Index Warrants that may be
exercised by all owners (or by any person or entity) on any day; (15) any
provisions for the automatic exercise of such Index Warrants; (16) whether and
under what circumstances such Index Warrants may be cancelled by the
Corporation prior to expiration; (17) any provisions permitting a holder of
such Index Warrants to condition any notice of exercise on the absence of
certain specified changes in the value of the Index after the date of
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exercise; (18) any other procedures and conditions relating to the exercise of
such Index Warrants; (19) if applicable, the designation and terms of any
related Debt Securities or other Warrants with which such Index Warrants are
issued, including whether such Debt Securities are Senior Debt Securities or
Subordinated Debt Securities and whether such other Warrants are Debt Warrants,
Currency Warrants, Index Warrants or Interest Rate Warrants, and the number of
such Index Warrants issued with each such Debt Security or other Warrant; (20)
the date, if any, on and after which such Index Warrants and any related Debt
Securities or other Warrants will be separately transferable; (21) the date on
which the right to exercise such Index Warrants will commence and the date on
which such right will expire; (22) the identity of the Warrant Agent under the
applicable Warrant Agreement; (23) any national securities exchange on which
such Index Warrants will be listed; and (24) any other terms of such Index
Warrants.
Unless otherwise specified in the applicable Prospectus Supplement, Index
Warrants will be issued in the form of Global Securities held in book-entry
form. See "Book-Entry Securities" below.
Unless otherwise specified in the applicable Prospectus Supplement, each
Index will be an established, broadly-based index related to a major domestic
or foreign securities trading market or based upon a portfolio of specified
stocks or other securities, and the cash settlement value (and, if applicable,
the amount payable on cancellation) of the Index Warrants will be payable in
U.S. dollars.
Exercise of Index Warrants. Index Warrants may be exercised in the manner set
forth in the applicable Prospectus Supplement. Unless otherwise specified in
the Applicable Prospectus Supplement, in the case of Index Warrants held in
book-entry form, as described under "Book-Entry Securities" below, upon receipt
by the Warrant Agent of payment of the exercise price, if any, and notice of
exercise and delivery of the applicable Index Warrants to the account of the
Corporation free on the books of DTC, the Corporation will, as soon as
practicable, make adequate funds available to the Warrant Agent to make payment
of the applicable amounts to the account of the holder of such Index Warrants
specified in the applicable notice of exercise. In the case of Index Warrants
held in definitive form, the Corporation will make such payment upon such
exercise as soon as practicable upon receipt of payment of the exercise price,
if any, and the applicable Warrant Certificate properly completed and duly
executed at the corporate trust office of the applicable Warrant Agent or any
other office indicated in the applicable Prospectus Supplement. If fewer than
all of the Index Warrants represented by such Warrant Certificate are
exercised, a new Warrant Certificate will be issued for the remaining number of
Index Warrants.
Index Warrants will be settled only in cash and, accordingly, will not
require or entitle the holder thereof to sell, make delivery, purchase or take
delivery of any securities (including any Underlying Security), nor will the
Corporation be under any obligation to, nor will it, purchase or take delivery
of or sell or make delivery of any securities (including any Underlying
Security) from or to holders of Index Warrants pursuant to such Index Warrants.
The holders of Index Warrants will not receive any interest on any cash
settlement value or amount payable on cancellation of the Index Warrants, and
the Index Warrants will not entitle the holders thereof to any of the rights of
holders of any securities (including any Underlying Security).
Extraordinary Events. If so specified in the applicable Prospectus
Supplement, following the occurrence of an Extraordinary Event, Index Warrants
may be cancelled by the Corporation, the cash settlement value of such Index
Warrants may be determined on a different basis than under normal
circumstances, or the exercise or valuation of, or payment for, such Index
Warrants may be delayed or postponed. Upon cancellation, the holders of such
Index Warrants will be entitled to receive only the applicable amount payable
on cancellation specified in such Prospectus Supplement. The amount payable on
cancellation may be either a fixed amount or an amount that varies during the
term of the Index Warrants in accordance with a schedule or formula as
specified in the applicable Prospectus Supplement.
Other Information. Other important information regarding the Index Warrants
is set forth below under "--Certain Items Applicable to All Warrants" and under
"Book-Entry Securities," "United States Taxation" and "Foreign Currency Risks."
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DESCRIPTION OF INTEREST RATE WARRANTS
General. Interest Rate Warrants may be issued in the form of (i) Interest
Rate Warrants ("Interest Rate Put Warrants") entitling the holders thereof to
receive from the Corporation upon exercise an amount in cash determined by
reference to decreases in a fixed yield, price or rate of a Debt Instrument, in
a Rate or in any combination of Debt Instruments and/or Rates or in a yield,
price or rate that varies during the term of the Interest Rate Warrants in
accordance with a schedule or formula, (ii) Interest Rate Warrants ("Interest
Rate Call Warrants") entitling the holders thereof to receive from the
Corporation upon exercise an amount in cash determined by reference to
increases in such characteristics or rates, or (iii) any combination of the
foregoing. The applicable Prospectus Supplement will set forth the formula
pursuant to which the cash settlement value of the Interest Rate Warrants will
be determined, including any multipliers, if applicable. The "Debt Instrument,"
if any, will be one or more instruments issued either by the United States
government or by a foreign government and will be specified in the applicable
Prospectus Supplement. The "Rate," if any, will be one or more interest rates
or interest rate swap rates specified in the applicable Prospectus Supplement.
An Interest Rate Warrant will not require or entitle the holder thereof to
purchase or take delivery of or sell or make delivery of any securities
(including Debt Instruments), nor will the Corporation be under any obligation
to, nor will it, purchase or take delivery of or sell or make delivery of any
securities (including Debt Instruments) from or to holders of the Interest Rate
Warrants pursuant to the Interest Rate Warrants.
Unless otherwise provided in the applicable Prospectus Supplement, each
Interest Rate Warrant will entitle the holder thereof to receive from the
Corporation upon exercise the cash settlement value of such Interest Rate
Warrant. Unless earlier terminated or cancelled, Interest Rate Warrants may be
exercised at any time up to the close of business on the expiration date set
forth in the applicable Prospectus Supplement. Certain Interest Rate Warrants
will, if specified in the applicable Prospectus Supplement, entitle the holders
thereof to receive from the Corporation a certain amount upon cancellation of
the Interest Rate Warrants by the Corporation upon the occurrence of specified
events. If specified in the applicable Prospectus Supplement, the Interest Rate
Warrants may be deemed automatically exercised if not exercised by the holder
thereof on or before the expiration date of such Warrants (or such other date
as is specified in the applicable Prospectus Supplement). In addition, if so
specified in the applicable Prospectus Supplement, following the occurrence of
an Extraordinary Event (as defined in the applicable Prospectus Supplement),
the cash settlement value of an Interest Rate Warrant may, at the option of the
Corporation, be determined on a different basis, including in connection with
automatic exercise at expiration.
The Prospectus Supplement will describe the terms of Interest Rate Warrants
offered thereby, the Warrant Agreement relating to such Interest Rate Warrants
and the Warrant Certificates representing such Interest Rate Warrants,
including the following: (1) the title of such Interest Rate Warrants; (2)
whether such Interest Rate Warrants shall be Interest Rate Put Warrants,
Interest Rate Call Warrants, or any combination thereof; (3) the aggregate
number of such issue of Interest Rate Warrants; (4) the initial offering price
of such Interest Rate Warrants; (5) the exercise price, if any, of such
Interest Rate Warrants; (6) the currency, or unit of two or more currencies, in
which the initial offering price, the exercise price, if any, and/or the cash
settlement value of such Interest Rate Warrants is payable; (7) the Debt
Instrument, Rate, or other yield, price or rate utilized for such Interest Rate
Warrants, and certain information regarding such Debt Instrument, Rate or other
measure; (8) the method of providing for a substitute Debt Instrument, Rate or
other measure or otherwise determining the amount payable with respect to such
Interest Rate Warrants if such Debt Instrument is no longer issued or changes
or such Rate or other measure changes or is no longer made available; (9) the
formula for determining the cash settlement value of such Interest Rate
Warrants; (10) the circumstances, if any, in which the exercise price, if any,
or the formula for determining the cash settlement value may change; (11)
whether and under what circumstances a maximum expiration value is applicable
upon the expiration or exercise of such Interest Rate Warrants; (12) the effect
or effects, if any, of the occurrence of an Extraordinary Event; (13) the
minimum number, if any, of such Interest Rate Warrants that must be exercised
at any one time, other than upon automatic exercise, if any; (14) the maximum
number, if any, of such Interest Rate Warrants, that may be exercised by all
owners (or by any person or entity) on
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any day; (15) any provisions for the automatic exercise of such Interest Rate
Warrants; (16) whether and under what circumstances such Interest Rate Warrants
may be cancelled by the Corporation prior to expiration; (17) any provisions
permitting a holder of such Interest Rate Warrants to condition any notice of
exercise on the absence of certain specified changes in the value of the Debt
Instrument, Rate or other measure after the date of exercise; (18) any other
procedures and conditions relating to the exercise of such Interest Rate
Warrants; (19) if applicable, the designation and terms of any related Debt
Securities or other Warrants with which such Interest Rate Warrants are issued,
including whether such Debt Securities are Senior Debt Securities or
Subordinated Debt Securities and whether such other Warrants are Debt Warrants,
Currency Warrants, Index Warrants or Interest Rate Warrants, and the number of
such Interest Rate Warrants issued with each such Debt Security or other
Warrant; (20) the date, if any, on and after which such Interest Rate Warrants
and any related Debt Securities or other Warrants will be separately
transferable; (21) the date on which the right to exercise such Interest Rate
Warrants shall commence and the date on which such right will expire; (22) the
identity of the Warrant Agent under the applicable Warrant Agreement; (23) any
national securities exchange on which such Interest Rate Warrants will be
listed; and (24) any other terms of such Interest Rate Warrants.
Unless otherwise specified in the applicable Prospectus Supplement, Interest
Rate Warrants will be issued in the form of Global Securities held in book-
entry form. See "Book-Entry Securities" below.
Unless otherwise specified in the applicable Prospectus Supplement, the cash
settlement value (and, if applicable, the amount payable on cancellation) of
the Interest Rate Warrants will be payable in U.S. dollars.
Exercise of Interest Rate Warrants. Interest Rate Warrants may be exercised
in the manner set forth in the applicable Prospectus Supplement. Unless
otherwise specified in the applicable Prospectus Supplement, in the case of
Interest Rate Warrants held in book-entry form, as described under "Book-Entry
Securities" below, upon receipt by the Warrant Agent of payment of the exercise
price, if any, and notice of exercise and delivery of the applicable Interest
Rate Warrants to the account of the Corporation free on the books of DTC, the
Corporation will, as soon as practicable, make adequate funds available to the
Warrant Agent to make payment of the applicable amounts to the account of the
holder of such Interest Rate Warrants specified in the applicable notice of
exercise. In the case of Interest Rate Warrants held in definitive form, the
Corporation will make such payment upon such exercise as soon as practicable
upon receipt of payment of the exercise price, if any, and the applicable
Warrant Certificate properly completed and duly executed at the corporate trust
office of the applicable Warrant Agent or any other office indicated in the
applicable Prospectus Supplement. If fewer than all of the Interest Rate
Warrants represented by such Warrant Certificate are exercised, a new Warrant
Certificate will be issued for the remaining number of Interest Rate Warrants.
Interest Rate Warrants will be settled only in cash and, accordingly, will
not require or entitle the holder thereof to sell, make delivery, purchase or
take delivery of any securities (including any Debt Instrument), nor will the
Corporation be under any obligation to, nor will it, purchase or take delivery
of or sell or make delivery of any securities (including any Debt Instrument)
from or to holders of Interest Rate Warrants pursuant to such Interest Rate
Warrants. The holders of Interest Rate Warrants will not receive any interest
on any cash settlement value or amount payable on cancellation of the Interest
Rate Warrants, and the Interest Rate Warrants will not entitle the holders
thereof to any of the rights of holders of any securities (including any Debt
Instrument).
Extraordinary Events. If so specified in the applicable Prospectus
Supplement, following the occurrence of an Extraordinary Event, Interest Rate
Warrants may be cancelled by the Corporation, the cash settlement value of such
Interest Rate Warrants may be determined on a different basis than under normal
circumstances, or the exercise or valuation of, or payment for, such Interest
Rate Warrants may be delayed or postponed. Upon cancellation, the holders of
such Interest Rate Warrants will be entitled to receive only the applicable
amount payable on cancellation specified in such Prospectus Supplement. The
amount payable on cancellation may be either a fixed amount or an amount that
varies during the term of the Interest Rate Warrants in accordance with a
schedule or formula as specified in the applicable Prospectus Supplement.
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Other Information. Other important information regarding the Interest Rate
Warrants is set forth below under "--Certain Items Applicable to All Warrants"
and under "Book-Entry Securities," "United States Taxation" and "Foreign
Currency Risks."
CERTAIN ITEMS APPLICABLE TO ALL WARRANTS
Modification. Any Warrant Agreement and the terms of the related Warrants may
be amended by the Corporation and the applicable Warrant Agent (which amendment
shall take the form of a supplemental warrant agreement (collectively referred
to as "Supplemental Agreements")), without the consent of the holders of any
such Warrants, for the purpose of (i) curing any ambiguity or of curing,
correcting or supplementing any defective or inconsistent provision contained
therein, or of making any other provisions with respect to matters or questions
arising under the Warrant Agreement that shall not be inconsistent with the
provisions of the Warrant Agreement or the Warrant Certificates, (ii)
evidencing the succession of another corporation to the Corporation and the
assumption by any such successor of the covenants of the Corporation contained
in such Warrant Agreement and the Warrants, (iii) appointing a successor
depository, (iv) evidencing and providing for the acceptance of appointment by
a successor Warrant Agent with respect to the Warrants, (v) adding to the
covenants of the Corporation for the benefit of the holders of such Warrants or
surrendering any right or power conferred upon the Corporation under the
Warrant Agreement, (vi) issuing Warrants in definitive form, if such Warrants
are initially issued in book-entry form, or (vii) amending the Warrant
Agreement and the Warrants in any manner that the Corporation may deem to be
necessary or desirable and that will not materially and adversely affect the
interests of the holders of such Warrants.
The Corporation and the Warrant Agent may also amend any Warrant Agreement
and the terms of the related Warrants (which amendment shall take the form of a
Supplemental Agreement) with the consent of the holders of not less than 66
2/3% in number of the unexercised Warrants affected by such amendment, for the
purpose of adding any provisions to or modifying in any manner or eliminating
any of the provisions of such Warrant Agreement or of modifying in any manner
the rights of the holders of such Warrants, except that no such amendment that
(i) changes the determination of the cash settlement value or amount payable on
cancellation, if any, of such Warrants (or any aspects of such determination)
so as to reduce the amount receivable upon exercise or deemed exercise, (ii)
shortens the period of time during which the Warrants may be exercised, (iii)
otherwise materially and adversely affects the exercise rights of the holders
of such Warrants, or (iv) reduces the number of unexercised Warrants the
consent of holders of which is required for amendment of the Warrant Agreement
or the related Warrants, may be made without the consent of each holder
affected thereby.
Merger, Consolidation, Sale, Lease or Other Dispositions. Each Warrant
Agreement will provide that the Corporation may consolidate or merge with or
into any other corporation or sell, lease or convey all or substantially all of
its assets to any other corporation, provided that (i) either the Corporation
must be the continuing corporation or the corporation (if other than the
Corporation) that is formed by or results from any such consolidation or merger
or that receives such assets must be a corporation organized and existing under
the laws of the United States of America or a state thereof and must assume the
obligations of the Corporation to make due and punctual payment of the cash
settlement value (or amount payable on cancellation, if applicable) with
respect to all the unexercised Warrants and the performance and observance of
all of the covenants and conditions of the applicable Warrant Agreement to be
performed or observed by the Corporation and (ii) the Corporation or such
successor corporation, as the case may be, must not immediately be in default
under such Warrant Agreement.
Enforceability of Rights by Holders of Warrants. Each Warrant Agent will act
solely as the agent of the Corporation under the applicable Warrant Agreement
and will not assume any obligation or relationship of agency or trust for or
with any holder of any Warrant. A single bank or trust company may act as
Warrant Agent for more than one issue of Warrants. A Warrant Agent will have no
duty or responsibility in case of any default by the Corporation in the
performance of its obligations under the applicable Warrant Agreement or
Warrant including, without limitation, any duty or responsibility to initiate
any proceedings at law or otherwise or to make any demand upon the Corporation.
Any holder of a Warrant may, without the consent
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of the related Warrant Agent enforce by appropriate legal action, in and for
its own behalf, its right to exercise, and receive payment for, its Warrants.
Listing. Unless otherwise indicated in the applicable Prospectus Supplement,
each issue of Warrants will be listed on a national securities exchange as
specified in the Prospectus Supplement, subject only to official notice of
issuance, as a condition of sale of any such Warrants. It is expected that such
exchange will cease trading an issue of Warrants at the close of business on
the related expiration date of such Warrants. In the event that the Warrants
are delisted from, or permanently suspended from trading on, such exchange, the
expiration date for such Warrants will be the date such delisting or trading
suspension becomes effective and Warrants not previously exercised will be
deemed automatically exercised on such expiration date. The Corporation will
notify holders of Warrants as soon as practicable of any such delisting or
permanent trading suspension. The applicable Warrant Agreement will contain a
covenant of the Corporation not to seek delisting of the Warrants from, or
suspension of their trading on, such exchange.
Title. The Corporation, each Warrant Agent and each agent of the Corporation
or the relevant Warrant Agent may treat the registered owner of any Warrant as
the absolute owner thereof (notwithstanding any notice to the contrary) for the
purpose of making payment and for all other purposes. See "Book-Entry
Securities" below.
Replacement of Warrant Certificates. Any mutilated Warrant Certificate will
be replaced by the Corporation at the expense of the holder upon surrender of
such Warrant Certificate to the applicable Warrant Agent. Warrant Certificates
that are destroyed, lost or stolen will be replaced by the Corporation at the
expense of the holder upon delivery to the relevant Warrant Agent of evidence
of the destruction, loss or theft thereof satisfactory to the Corporation and
the relevant Warrant Agent. In the case of a destroyed, lost or stolen Warrant
Certificate, an indemnity satisfactory to the relevant Warrant Agent and the
Corporation may be required at the expense of the holder of such Warrant before
a replacement Warrant Certificate will be issued.
Governing Law. The Warrant Agreements and Warrants will be governed by, and
construed in accordance with, the laws of the State of New York.
"Reopening" of an Issue of Warrants. The Corporation will have the right to
"reopen" a previous issue of Warrants and to issue additional Warrants of such
issue without the consent of any holder of Warrants of such issue.
BOOK-ENTRY SECURITIES
Unless otherwise specified in the applicable Prospectus Supplement, the
Offered Securities will be issued in the form of one or more global
certificates (collectively, with respect to each series or issue of Offered
Securities, the "Global Security") registered in the name of a depositary or a
nominee of a depositary. Unless otherwise specified in the applicable
Prospectus Supplement, the depositary will be The Depository Trust Company
("DTC"). The Corporation has been informed by DTC that its nominee will be Cede
& Co. ("Cede"). Accordingly, Cede is expected to be the initial registered
holder of the Offered Securities that are issued in global form. No person that
acquires an interest in such Offered Securities (each such person, a "Holder")
will be entitled to receive a certificate representing such person's interest
in the Offered Securities except as set forth herein or in the accompanying
Prospectus Supplement. Unless and until definitive Offered Securities are
issued under the limited circumstances described herein, all references to
actions by holders of Offered Securities issued in global form shall refer to
actions taken by DTC upon instructions from its Participants (as defined
below), and all references herein to payments and notices to holders shall
refer to payments and notices to DTC or Cede, as the registered holder of such
Offered Securities.
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DTC has informed the Corporation that it is a limited purpose trust company
organized under the New York Banking Law, a "banking organization" within the
meaning of the New York Banking Law, that it is a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code and a "clearing agency" registered pursuant to Section 17A of
the Exchange Act, and that it was created to hold securities for its
participating organizations ("Participants") and to facilitate the clearance
and settlement of securities transactions among Participants through electronic
book-entry, thereby eliminating the need for physical movement of certificates.
Participants include securities brokers and dealers, banks, trust companies and
clearing corporations, and may include certain other organizations. Indirect
access to the DTC system also is available to others such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly ("Indirect
Participants").
Holders that are not Participants or Indirect Participants but that desire to
purchase, sell or otherwise transfer ownership of, or other interests in,
Offered Securities may do so only through Participants and Indirect
Participants. Under a book-entry format, Holders may experience some delay in
their receipt of payments, as such payments will be forwarded by the agent
designated by the Corporation to Cede, as nominee for DTC. DTC will forward
such payments to its Participants, which thereafter will forward them to
Indirect Participants or Holders. Holders will not be recognized by the
applicable Trustee or Warrant Agent as registered holders of the Offered
Securities entitled to the benefits of the applicable Indenture or Warrant
Agreement. Holders that are not Participants will be permitted to exercise
their rights as such only indirectly through and subject to the procedures of
Participants and, if applicable, Indirect Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations as currently in effect (the "Rules"), DTC will be required to
make book-entry transfers of Offered Securities among Participants and to
receive and transmit payments to Participants. Participants and Indirect
Participants with which Holders have accounts with respect to the Offered
Securities similarly are required by the Rules to make book-entry transfers and
receive and transmit such payments on behalf of their respective Holders.
Because DTC can act only on behalf of Participants, who in turn act only on
behalf of Holders or Indirect Participants, and on behalf of certain banks,
trust companies and other persons approved by it, the ability of a Holder to
pledge Offered Securities to persons or entities that do not participate in the
DTC system, or to otherwise act with respect to such Offered Securities, may be
limited due to the absence of physical certificates for such Offered
Securities.
DTC has advised the Corporation that DTC will take any action permitted to be
taken by a registered holder of any Offered Securities under the applicable
Indenture or Warrant Agreement only at the direction of one or more
Participants to whose accounts with DTC such Offered Securities are credited.
A Global Security will be exchangeable for the relevant definitive Offered
Securities registered in the names of persons other than DTC or its nominee
only if (i) DTC notifies the Corporation that it is unwilling or unable to
continue as depository for such Global Security or if at any time DTC ceases to
be a clearing agency registered under the Exchange Act at a time when DTC is
required to be so registered in order to act as such depository, (ii) the
Corporation executes and delivers to the applicable Trustee and/or Warrant
Agent an order complying with the requirements of the applicable Indenture
and/or Warrant Agreement that such Global Security shall be so exchangeable or
(iii) there has occurred and is continuing a default in the payment of
principal of, premium, if any, or interest on, the Debt Securities or the
payment of the cash settlement amount, or cancellation amount, if any, of the
Warrants, or, in the case of Debt Securities, an Event of Default or an event
that, with the giving of notice or lapse of time, or both, would constitute an
Event of Default with respect to such Debt Securities. Any Global Security that
is exchangeable pursuant to the preceding sentence will be exchangeable for
Debt Securities or Warrants registered in such names as DTC directs.
Upon the occurrence of any event described in the immediately preceding
paragraph, DTC is generally required to notify all Participants of the
availability through DTC of definitive Offered Securities. Upon surrender by
DTC of the Global Security representing the Offered Securities and delivery of
instructions for
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re-registration, the Trustee or Warrant Agent, as the case may be, will reissue
the Offered Securities as definitive Debt Securities or Warrants, and
thereafter such Trustee or Warrant Agent will recognize the Holders of such
definitive Offered Securities as registered holders of Offered Securities
entitled to the benefits of the applicable Indenture or Warrant Agreement.
Except as described above, the Global Security may not be transferred except
as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another
nominee of DTC or to a successor depositary appointed by the Corporation.
Except as described above, DTC may not sell, assign, transfer or otherwise
convey any beneficial interest in a Global Security evidencing all or part of
the Offered Securities unless such beneficial interest is in an amount equal to
an authorized denomination for the Offered Securities.
UNITED STATES TAXATION
Certain special United States federal income tax considerations may be
applicable to the Debt Securities and Warrants. The applicable Prospectus
Supplement will describe such tax considerations. The summary of United States
federal income tax considerations contained in such Prospectus Supplement will
be presented for informational purposes only, however, and will not be intended
as legal or tax advice to prospective purchasers. Prospective purchasers of
Debt Securities and Warrants are urged to consult their own tax advisors prior
to any acquisition of such Offered Securities.
FOREIGN CURRENCY RISKS
GENERAL
Debt Securities of a series, and payments made in respect of Warrants of an
issue, may be denominated in such foreign currency, or unit of two or more
currencies, as may be designated by the Corporation at the time of offering
(such Offered Securities, "Foreign Currency Securities").
THIS PROSPECTUS DOES NOT DESCRIBE ALL RISKS OF AN INVESTMENT IN FOREIGN
CURRENCY SECURITIES THAT RESULT FROM SUCH FOREIGN CURRENCY SECURITIES, OR
AMOUNTS PAYABLE IN RESPECT OF SUCH FOREIGN CURRENCY SECURITIES, BEING
DENOMINATED IN A FOREIGN CURRENCY, OR UNIT OF TWO OR MORE CURRENCIES, EITHER AS
SUCH RISKS EXIST AT THE DATE OF THIS PROSPECTUS OR AS SUCH RISKS MAY CHANGE
FROM TIME TO TIME. PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL
AND LEGAL ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN FOREIGN
CURRENCY SECURITIES. FOREIGN CURRENCY SECURITIES ARE NOT AN APPROPRIATE
INVESTMENT FOR INVESTORS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN
CURRENCY TRANSACTIONS. ADDITIONAL FACTORS MAY BE SET FORTH IN CONNECTION WITH A
SPECIFIC FOREIGN CURRENCY SECURITY IN THE APPLICABLE PROSPECTUS SUPPLEMENT.
Unless otherwise indicated in the applicable Prospectus Supplement, a Foreign
Currency Security will not be sold in, or to a resident of, the country of the
Specified Currency (as defined below) in which such Foreign Currency Security
is denominated. The information set forth below is by necessity incomplete and
prospective purchasers of Foreign Currency Securities should consult their own
financial and legal advisors with respect to any matters that may affect the
purchase or holding of a Foreign Currency Security or the receipt of payments
of principal of, and premium, if any, and interest on, a Foreign Currency
Security in a Specified Currency.
EXCHANGE RATES AND EXCHANGE CONTROLS
An investment in Foreign Currency Securities entails significant risks that
are not associated with a similar investment in a security denominated in U.S.
dollars. Such risks include, without limitation, the
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possibility of significant changes in the rate of exchange between the U.S.
dollar and the currency, or unit of two or more currencies, designated by the
Corporation at the time of offering (the "Specified Currency") and the
possibility of the imposition or modification of foreign exchange controls by
either the United States or foreign governments. Such risks generally depend on
economic and political events and the supply of and demand for the relevant
currencies, over which the Corporation has no control. In recent years, rates
of exchange between the U.S. dollar and certain foreign currencies have been
highly volatile and such volatility may be expected in the future. Fluctuations
in any particular exchange rate that have occurred in the past are not
necessarily indicative, however, of fluctuations in the rate that may occur
during the term of any Foreign Currency Security. Depreciation of the Specified
Currency applicable to a Foreign Currency Security against the U.S. dollar
would result in a decrease in the U.S. dollar- equivalent yield of such Foreign
Currency Security, in the U.S. dollar-equivalent value of the principal
repayable at maturity of such Foreign Currency Security and, generally, in the
U.S. dollar-equivalent market value of such Foreign Currency Security.
Governments have imposed from time to time exchange controls and may in the
future impose or revise exchange controls at or prior to a Foreign Currency
Security's maturity or expiration. Even if there are no exchange controls in
effect with respect to a Specified Currency, it is possible that the Specified
Currency for any particular Foreign Currency Security would not be available at
such Foreign Currency Security's maturity or expiration due to other
circumstances beyond the control of the Corporation.
JUDGMENTS
If an action based on Foreign Currency Securities were commenced in a court
of the United States, it is likely that such court would grant judgment
relating to such Foreign Currency Securities only in U.S. dollars. It is not
clear, however, whether, in granting such judgment, the rate of conversion into
U.S. dollars would be determined with reference to the date of default, the
date on which judgment is rendered or some other date. Holders of Foreign
Currency Securities would bear the risk of exchange rate fluctuations between
the time the amount of the judgment is calculated and the time the applicable
Trustee or Warrant Agent converts U.S. dollars to the Specified Currency for
payment of the judgment.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities to which this Prospectus relates will
be passed upon for the Corporation by Gordon S. Calder, Jr., Esq., a Managing
Director and Counsel of Bankers, and for any underwriters or agents by Sullivan
& Cromwell, New York, New York. Sullivan & Cromwell performs services for the
Corporation, and may act as special tax counsel to the Corporation in
connection with offerings of Offered Securities. Mr. Calder has an interest in
a number of shares equal to less than .015% of the Corporation's outstanding
Common Stock, par value $1.00 per share.
EXPERTS
The consolidated financial statements of the Corporation for the year ended
December 31, 1993, appearing in the Corporation's Annual Report on Form 10-K
for the year ended December 31, 1993, and incorporated by reference into this
Prospectus, have been audited by Ernst & Young, independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in auditing and accounting.
PLAN OF DISTRIBUTION
The Corporation may sell Offered Securities to one or more underwriters for
public offering and sale by them or may sell Offered Securities to investors
directly or through agents. Any underwriter or agent involved in the offer and
sale of the Offered Securities will be named in the applicable Prospectus
Supplement.
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Underwriters may offer and sell the Offered Securities at a fixed price or
prices, which may be changed, or from time to time at market prices prevailing
at the time of sale, at prices related to such prevailing market prices or at
negotiated prices. The Corporation also may, from time to time, authorize firms
acting as the Corporation's agents to offer and sell the Offered Securities
upon the terms and conditions set forth in the applicable Prospectus
Supplement. In connection with the sale of Offered Securities, underwriters may
be deemed to have received compensation from the Corporation in the form of
underwriting discounts or commissions and may also receive commissions from
purchasers of Offered Securities for whom they may act as agents. Underwriters
may sell Offered Securities to or through dealers, and such dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions (which may be changed from time to time) from
the purchasers for whom they may act as agents.
Any underwriting compensation paid by the Corporation to underwriters or
agents in connection with the offering of Offered Securities, and any
discounts, concessions or commissions allowed by underwriters to participating
dealers, will be set forth in the applicable Prospectus Supplement.
Underwriters, dealers and agents participating in the distribution of the
Offered Securities may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of the
Offered Securities may be deemed to be underwriting discounts and commissions
under the Securities Act. Underwriters, dealers and agents may be entitled,
under agreements with the Corporation, to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Securities Act, and to reimbursement by the Corporation for certain expenses.
If so indicated in the applicable Prospectus Supplement, the Corporation will
authorize dealers acting as the Corporation's agents to solicit offers by
certain institutions to purchase Offered Securities from the Corporation at the
public offering price set forth in such Prospectus Supplement pursuant to
Delayed Delivery Contracts ("Contracts") providing for payment and delivery on
the date or dates stated in such Prospectus Supplement. Each Contract will be
for an amount not less than, and the aggregate principal or face amount or
number of Offered Securities sold pursuant to Contracts shall be not less nor
more than, the respective amounts stated in such Prospectus Supplement.
Institutions with whom Contracts, when authorized, may be made include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and other institutions, but
will in all cases be subject to the approval of the Corporation. Contracts will
not be subject to any conditions except (i) the purchase by an institution of
the Offered Securities covered by its Contracts shall not at the time of
delivery be prohibited under the laws of any jurisdiction in the United States
to which such institution is subject, and (ii) if the Offered Securities are
being sold to underwriters, the Corporation shall have sold to such
underwriters the total principal or face amount or number of the Offered
Securities less the principal or face amount or number thereof covered by
Contracts. Agents and underwriters will have no responsibility in respect of
the delivery or performance of Contracts.
Each series of Offered Securities will be a new issue of securities with no
established trading market. Any underwriters to whom Offered Securities are
sold by the Corporation for public offering and sale may make a market in such
Offered Securities, but such underwriters will not be obligated to do so and
may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of or the trading markets for any Offered
Securities.
This Prospectus and the applicable Prospectus Supplement may also be
delivered in connection with sales of Offered Securities by affiliates of the
Corporation that have acquired such Offered Securities.
The offer and sale of the Offered Securities will comply with the
requirements of Schedule E of the By- Laws of the National Association of
Securities Dealers, Inc. regarding underwriting securities of an affiliate.
Certain of the underwriters or agents and their associates may be customers
of, engage in transactions with, and perform services for, the Corporation in
the ordinary course of business.
23
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND
THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS
PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY SUCH SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS
NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Bankers Trust New York Corporation......................................... S-2
Selected Consolidated Financial Data and Other Information................. S-6
Certain Terms of the Offered Notes......................................... S-7
Experts.................................................................... S-8
Validity of Offered Notes.................................................. S-8
Underwriting............................................................... S-9
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
Bankers Trust New York Corporation......................................... 3
Use of Proceeds............................................................ 4
Description of Debt Securities............................................. 4
Description of Warrants.................................................... 10
Book-Entry Securities...................................................... 19
United States Taxation..................................................... 21
Foreign Currency Risks..................................................... 21
Validity of Offered Securities............................................. 22
Experts.................................................................... 22
Plan of Distribution....................................................... 22
</TABLE>
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$150,000,000
BANKERS TRUST
NEW YORK CORPORATION
7 1/2% SUBORDINATED NOTES DUE
NOVEMBER 15, 2015
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PROSPECTUS SUPPLEMENT
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GOLDMAN, SACHS & CO.
BT SECURITIES CORPORATION
LEHMAN BROTHERS
UBS SECURITIES INC.
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