<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 31, 1997
REGISTRATION NOS. 333-15089 AND 333-15089-01 THROUGH 04
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
PRE-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
BANKERS TRUST NEW YORK CORPORATION BT PREFERRED CAPITAL TRUST I
(EXACT NAME OF REGISTRANT AS BT PREFERRED CAPITAL TRUST II
SPECIFIED IN ITS CHARTER) BT PREFERRED CAPITAL TRUST III
BT PREFERRED CAPITAL TRUST IV
(EXACT NAME OF REGISTRANT AS
SPECIFIED IN ITS CHARTER)
NEW YORK DELAWARE
(STATE OR OTHER JURISDICTION OF (STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION) INCORPORATION OR ORGANIZATION)
13-6180473 51-6506259
(I.R.S. EMPLOYER IDENTIFICATION 51-6506260
NUMBER) 51-6506261
51-6506262
130 LIBERTY STREET (I.R.S. EMPLOYER IDENTIFICATION
NEW YORK, NEW YORK 10006 NUMBER)
(212) 250-2500 C/O BANKERS TRUST NEW YORK
(ADDRESS, INCLUDING ZIP CODE, AND CORPORATION
TELEPHONE NUMBER, INCLUDING AREA 130 LIBERTY STREET
CODE, OF REGISTRANT'S PRINCIPAL NEW YORK, NEW YORK 10006
EXECUTIVE OFFICES) (212) 250-2500
(ADDRESS, INCLUDING ZIP CODE, AND
TELEPHONE NUMBER, INCLUDING AREA
CODE, OF REGISTRANT'S PRINCIPAL
EXECUTIVE OFFICES)
GORDON S. CALDER, JR., ESQ.
MELVIN A. YELLIN, ESQ.
BANKERS TRUST NEW YORK CORPORATION
130 LIBERTY STREET
NEW YORK, NEW YORK 10006
(212) 250-2500
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,INCLUDING AREA CODE,
OF AGENT FOR SERVICE OF EACH REGISTRANT)
WITH COPIES TO:
MICHAEL M. WISEMAN, ESQ. KEVIN KEOGH, ESQ.
SULLIVAN & CROMWELL WHITE & CASE
125 BROAD STREET 1155 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10004 NEW YORK, NEW YORK 10036
(212) 558-4000 (212) 819-8200
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined
by market conditions.
---------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
---------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
(Continued on following page)
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<PAGE>
EXPLANATORY NOTE
This Registration Statement contains two forms of base prospectus: one to be
used in connection with the offering and sale of Junior Subordinated
Deferrable Interest Debentures, Preferred Securities and Guarantees, and one
to be used in connection with the offering and sale of Senior Debt Securities
and Subordinated Debt Securities. Each offering made under this Registration
Statement will be made pursuant to one of these base prospectuses, with the
specific terms of the securities offered thereby set forth in an accompanying
prospectus supplement.
In addition, the registrants currently intend to make an offering of a
portion of the securities registered under the registration statement as
permitted by Rule 430A under the Securities Act of 1933, as amended, and have
included a form of prospectus supplement for use in the offering. Such form of
prospectus supplement is for such offering only and will, when completed, be
filed pursuant to Rule 424(b). Prospectus supplements used in connection with
offerings of other securities registered hereunder will include only the
appropriate base prospectus and may be in a different form and contain other
information.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ +
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE PROSPECTUS TO +
+WHICH IT RELATES SHALL CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN +
+OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN +
+WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO +
+REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH ESTATE. +
+ +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JANUARY 31, 1997
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1997
$200,000,000
BT PREFERRED CAPITAL TRUST I
% PREFERRED SECURITIES, SERIES I
(LIQUIDATION AMOUNT $25 PER PREFERRED SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
[LOGO] BANKERS TRUST NEW YORK CORPORATION
----------
The % Preferred Securities, Series I (the "Preferred Securities"),
offered hereby represent preferred undivided beneficial interests in the assets
of BT Preferred Capital Trust I, a statutory business trust created under the
laws of the State of Delaware (the "Issuer Trust"). Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), will initially be the
holder of all the beneficial interests represented by common securities of the
Issuer Trust (the "Common Securities" and, collectively with the Preferred
Securities, the "Trust Securities"). Wilmington Trust Company is the
(Continued on next page)
----------
SEE "RISK FACTORS" BEGINNING ON PAGE S-7 HEREOF FOR CERTAIN INFORMATION
RELEVANT TO AN INVESTMENT IN THE PREFERRED SECURITIES.
----------
THESE SECURITIES 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 TO
WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------
<TABLE>
<CAPTION>
PROCEEDS TO
INITIAL PUBLIC UNDERWRITING THE ISSUER
OFFERING PRICE COMMISSION(1) TRUST(2)(3)
-------------- ------------- ------------
<S> <C> <C> <C>
Per Preferred Security............... $25 (2) $25
Total................................ $200,000,000 (2) $200,000,000
</TABLE>
- -----
(1) The Issuer Trust and the Corporation have each agreed to indemnify the
several Underwriters against certain liabilities, including liabilities
under the Securities Act of 1933, as amended. See "Underwriting" herein.
(2) In view of the fact that the proceeds of the sale of the Preferred
Securities will be invested in the Junior Subordinated Debentures (as
defined herein), the Corporation has agreed to pay to the Underwriters as
compensation for their arranging the investment therein of such proceeds
$ per Preferred Security (or $ in the aggregate). See
"Underwriting" herein. The compensation to be paid by the Corporation to
the Underwriters with respect to any Preferred Securities sold to certain
institutions will be $ . Therefore, to the extent of any such sales to
such institutions, the actual total underwriting commission will be less
than the foregoing amounts.
(3) Expenses of the offering that are payable by the Corporation are estimated
to be $ .
----------
The Preferred Securities 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 Preferred Securities 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 February , 1997, against payment therefor in immediately
available funds.
----------
SMITH BARNEY INC.
MERRILL LYNCH & CO.
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
DEAN WITTER REYNOLDS INC.
AG EDWARDS & SONS, INC.
GOLDMAN, SACHS & CO.
The date of this Prospectus Supplement is , 1997.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE PREFERRED
SECURITIES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
----------------
(cover page continued)
Property Trustee of the Issuer Trust. The Issuer Trust exists for the sole
purpose of issuing the Trust Securities and investing the proceeds thereof in
% Junior Subordinated Deferrable Interest Debentures, Series I (the "Junior
Subordinated Debentures"), to be issued by the Corporation and engaging in
only those activities necessary or incidental thereto. The Junior Subordinated
Debentures will mature on February , 2037 (the "Stated Maturity"), which
date may be shortened to a date not earlier than February , 2002 if certain
conditions are met. The Corporation has committed to the Board of Governors of
the Federal Reserve System (the "Federal Reserve") not to exercise its right
to shorten the Stated Maturity of the Junior Subordinated Debentures without
having received the prior approval of the Federal Reserve to do so, if then
required under applicable Federal Reserve capital guidelines or policies. The
Preferred Securities will have a preference under certain circumstances over
the Common Securities with respect to cash distributions and amounts payable
on liquidation, redemption or otherwise. See "Description of Preferred
Securities--Subordination of Common Securities" in the accompanying
Prospectus.
Holders of the Preferred Securities will be entitled to receive preferential
cumulative cash distributions accumulating from February , 1997 and payable
quarterly in arrears on the day of January, April, July and October of each
year, commencing April , 1997, at the annual rate of % of the stated
liquidation amount of $25 (the "Liquidation Amount") per Preferred Security
("Distributions"). The Corporation has the right to defer payment of interest
on the Junior Subordinated Debentures at any time or from time to time for a
period not exceeding 20 consecutive quarters with respect to each deferral
period (each, an "Extension Period"), provided that no Extension Period may
extend beyond the Stated Maturity of the Junior Subordinated Debentures as in
effect at the time of the Corporation's election to defer interest in this
manner. Upon the termination of any such Extension Period and the payment of
all amounts then due, the Corporation may elect to begin a new Extension
Period subject to the requirements set forth herein. If interest payments on
the Junior Subordinated Debentures are so deferred, Distributions on the
Preferred Securities will also be deferred and the Corporation will not be
permitted, subject to certain exceptions described herein, to declare or pay
any cash distributions with respect to the Corporation's capital stock or with
respect to debt securities of the Corporation that rank pari passu in all
respects with or junior to the Junior Subordinated Debentures. During an
Extension Period, interest on the Junior Subordinated Debentures will continue
to accrue (and the amount of Distributions to which holders of the Preferred
Securities are entitled will accumulate) at the rate of % per annum,
compounded quarterly, and holders of Preferred Securities will be required to
accrue interest income for United States federal income tax purposes. See
"Certain Terms of Junior Subordinated Debentures--Option to Defer Interest
Payments" and "Certain Federal Income Tax Consequences--Interest Income and
Original Issue Discount" herein.
The Junior Subordinated Debentures are unsecured and subordinated to all
Senior Indebtedness (as defined under "Description of Junior Subordinated
Debentures--Subordination" in the accompanying Prospectus). Substantially all
of the Corporation's existing indebtedness constitutes Senior Indebtedness.
Because the Corporation is a holding company, the right of the Corporation to
participate in any distribution of assets of any subsidiary, including Bankers
Trust Company, upon such subsidiary's dissolution, winding-up, liquidation or
reorganization or otherwise (and thus the ability of holders of the Preferred
Securities to benefit indirectly from such distribution), is 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. Accordingly, the Junior Subordinated Debentures and the Guarantee
will be effectively subordinated to all existing and future liabilities of the
Corporation's subsidiaries, and holders thereof should look only to the assets
of the Corporation for payments on the Junior Subordinated Debentures and the
Guarantee. See "Description of Junior Subordinated Debentures--Subordination"
and "Description of Guarantees--General" in the accompanying Prospectus.
The Corporation has, through the Guarantee, the Declaration of Trust, the
Junior Subordinated Debentures, the Junior Subordinated Indenture and the
Expense Agreement (each as defined herein), taken together, fully, irrevocably
and unconditionally guaranteed all of the Issuer Trust's obligations under the
Preferred Securities.
S-2
<PAGE>
See "Relationship Among the Preferred Securities, the Corresponding Junior
Subordinated Debentures, the Guarantees and the Expense Agreements--Full and
Unconditional Guarantee" in the accompanying Prospectus. The Guarantee of the
Corporation guarantees the payment of Distributions and payments on liquidation
or redemption of the Preferred Securities, but only in each case to the extent
of funds available therefor held by the Issuer Trust, as described herein. See
"Description of Guarantees" in the accompanying Prospectus. If the Corporation
does not make payments on the Junior Subordinated Debentures held by the Issuer
Trust, the Issuer Trust will have insufficient funds to pay Distributions on
the Preferred Securities. The Guarantee does not cover payment of Distributions
when the Issuer Trust does not have sufficient funds to pay such Distributions.
In such event, a holder of Preferred Securities may institute a legal
proceeding directly against the Corporation to enforce payment of such
Distributions to such holder. See "Description of Junior Subordinated
Debentures--Enforcement of Certain Rights By Holders of Preferred Securities"
in the accompanying Prospectus.
The Preferred Securities are subject to mandatory redemption, in whole or in
part, upon repayment of the Junior Subordinated Debentures at the Stated
Maturity or their earlier redemption. The Junior Subordinated Debentures are
redeemable prior to the Stated Maturity at the option of the Corporation (i) on
or after February , 2002, in whole at any time or in part from time to time,
or (ii) in certain circumstances as described under "Description of Junior
Subordinated Debentures--Conditional Right to Redeem Upon a Tax Event,
Investment Company Event or Capital Treatment Event", in whole (but not in
part) at any time within 90 days upon the occurrence and during the
continuation of a Tax Event, Investment Company Event or Capital Treatment
Event (each as defined herein) (or, if the approval of the Federal Reserve is
then required for such redemption, on such later date as promptly as is
reasonably practicable after such approval is obtained), in each case at a
redemption price equal to 100% of the principal amount of the Junior
Subordinated Debentures so redeemed plus accrued and unpaid interest thereon to
the date fixed for redemption. The Corporation has committed to the Federal
Reserve that the Corporation will not exercise its right to redeem the Junior
Subordinated Debentures or cause the redemption of the Preferred Securities
prior to the Stated Maturity without having received the prior approval of the
Federal Reserve to do so, if then required under applicable Federal Reserve
capital guidelines or policies. See "Certain Terms of Preferred Securities--
Redemption" herein.
The holder of all the Common Securities has the right at any time to dissolve
the Issuer Trust and, after satisfaction of liabilities to creditors of the
Issuer Trust as provided by applicable law, to cause the Junior Subordinated
Debentures to be distributed to the holders of the Preferred Securities and
Common Securities in liquidation of the Issuer Trust. The Corporation has
committed to the Federal Reserve that, so long as the Corporation (or any
affiliate) is the holder of all the Common Securities, the Corporation (or such
affiliate) will not so dissolve the Issuer Trust without having received the
prior approval of the Federal Reserve to do so, if then required under
applicable Federal Reserve capital guidelines or policies. See "Certain Terms
of Preferred Securities--Liquidation of Issuer Trust and Distribution of Junior
Subordinated Debentures" herein.
If the Issuer Trust is dissolved, then after satisfaction of liabilities to
creditors of the Issuer Trust as provided by applicable law, the holders of the
Preferred Securities will be entitled to receive a Liquidation Amount of $25
per Preferred Security plus accumulated and unpaid Distributions thereon to the
date of payment, subject to certain exceptions, which may be in the form of a
distribution of such amount in Junior Subordinated Debentures. See "Description
of Preferred Securities--Liquidation Distribution Upon Dissolution" in the
accompanying Prospectus.
Application will be made to list the Preferred Securities on the New York
Stock Exchange, Inc. under the symbol "BTPrA". If the Junior Subordinated
Debentures are distributed to the holders of Preferred Securities upon the
liquidation of the Issuer Trust, the Corporation will use all reasonable
efforts to list the Junior Subordinated Debentures on the New York Stock
Exchange, Inc. or such other securities exchange or automated quotation system,
if any, on which the Preferred Securities may then be listed or traded.
The Preferred Securities will be represented by global certificates
registered in the name of The Depository Trust Company ("DTC") or its nominee.
Beneficial interests in the global certificates will be shown on, and transfers
thereof will be effected only through, records maintained by DTC and its direct
and indirect participants. Except as described in the accompanying Prospectus,
Preferred Securities in certificated form will not be issued in exchange for
the global certificates. See "Certain Terms of Preferred Securities--
Registration of Preferred Securities" herein and "Description of Preferred
Securities--Global Preferred Securities" in the accompanying Prospectus.
S-3
<PAGE>
SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus Supplement and the
accompanying Prospectus.
BANKERS TRUST NEW YORK CORPORATION
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
December 31, 1996, the Corporation had consolidated total assets of $120.2
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 Investment Banking, Risk Management
Services, Trading & Sales, Investment Management, Client Processing Services,
Australia/New Zealand, Asia, Latin America and Corporate. Among the
institutional market segments served are corporations, banks, other financial
institutions, governments and agencies, retirement plans, not-for-profit
organizations, wealthy individuals, foundations and private companies. 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.
BT PREFERRED CAPITAL TRUST I
The Issuer Trust is a statutory business trust created under Delaware law
pursuant to the filing of a certificate of trust with the Delaware Secretary of
State on October 29, 1996, which will be governed by the Declaration of Trust
(as defined below) among the Corporation, as Depositor, Wilmington Trust
Company, as Property Trustee and Delaware Trustee, the Administrative Trustees
named therein and the Holders of the Trust Securities from time to time. The
Issuer Trust's business and affairs are conducted by its trustees: initially
Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as
Delaware Trustee, and the Administrative Trustees. The Issuer Trust exists for
the exclusive purposes of (i) issuing and selling the Trust Securities,
(ii) using the proceeds from the sale of the Trust Securities to acquire the
Junior Subordinated Debentures and (iii) engaging in only those other
activities necessary or incidental thereto (such as registering the transfer of
the Trust Securities). Accordingly, the Junior Subordinated Debentures will be
the sole assets of the Issuer Trust, and payments under the Junior Subordinated
Debentures will be the sole source of revenue of the Issuer Trust.
THE OFFERING
Securities Offered..........
$200,000,000 aggregate Liquidation Amount of %
Preferred Securities, Series I (Liquidation
Amount $25 per Preferred Security).
Offering Price..............
$25 per Preferred Security (Liquidation Amount
$25), plus accumulated Distributions, if any,
from February , 1997.
Distribution Dates..........
January , April , July and October of each
year, com-mencing April , 1997.
Extension Periods........... Distributions on Preferred Securities may be
deferred for the duration of any Extension Period
selected by the Corporation with respect to the
payment of interest on the Junior Subordinated
S-4
<PAGE>
Debentures. No Extension Period will exceed 20
consecutive quarters or extend beyond the Stated
Maturity as in effect at the time of the
Corporation's election to defer interest in this
manner. See "Description of Junior Subordinated
Debentures--Option to Defer Interest Payments" in
the accompanying Prospectus and "Certain Federal
Income Tax Consequences--Interest Income and
Original Issue Discount" herein.
Ranking..................... The Preferred Securities will rank pari passu,
and payments thereon will be made pro rata, with
the Common Securities except as described under
"Description of Preferred Securities--
Subordination of Common Securities" in the
accompanying Prospectus. The Junior Subordinated
Debentures will be unsecured and subordinate and
junior in right of payment to the extent and in
the manner set forth in the Junior Subordinated
Indenture to all Senior Indebtedness (as defined
in the accompanying Prospectus). See "Description
of Junior Subordinated Debentures" in the
accompanying Prospectus. The Guarantee will
constitute an unsecured obligation of the
Corporation and will rank subordinate and junior
in right of payment to the extent and in the
manner set forth in the Guarantee to all Senior
Indebtedness. See "Description of Guarantees--
Status of the Guarantees" in the accompanying
Prospectus.
Redemption..................
The Trust Securities are subject to mandatory
redemption in whole but not in part (i) at the
Stated Maturity upon repayment of the Junior
Subordinated Debentures, (ii) contemporaneously
with the optional redemption at any time by the
Corporation of the Junior Subordinated Debentures
upon the occurrence and during the continuation
of a Tax Event, Investment Company Event or
Capital Treatment Event (in each case as defined
under "Description of Preferred Securities--
Redemption or Exchange" in the accompanying
Prospectus) and (iii) at any time on or after
February , 2002, contemporaneously with the
optional redemption by the Corporation of the
Junior Subordinated Debentures, in each case at a
redemption price equal to 100% of the Liquidation
Amount of such Preferred Securities plus
accumulated and unpaid Distributions thereon to
the date fixed for redemption. See "Description
of Preferred Securities--Redemption or Exchange"
in the accompanying Prospectus.
Rating...................... The Preferred Securities are expected to be rated
"a2" by Moody's Investors Service, Inc.
("Moody's") and BBB+ by Standard & Poor's Ratings
Services ("Standard & Poor's"). A security rating
is not a recommendation to buy, sell or hold
securities and may be subject to revision or
withdrawal at any time by the assigning rating
organization.
ERISA Considerations... Prospective purchasers must carefully consider
the restrictions on purchase set forth under
"Certain ERISA Considerations" herein.
S-5
<PAGE>
Absence of Market for the
Preferred Securities........ The Preferred Securities will be a new issue of
securities for which there currently is no
market. Although the Underwriters have informed
the Issuer Trust and the Corporation that the
Underwriters currently intend to make a market in
the Preferred Securities, the Underwriters are
not obligated to do so, and any such market
making may be discontinued at any time without
notice. Accordingly, there can be no assurance as
to the development or liquidity of any market for
the Preferred Securities. Application will be
made to list the Preferred Securities for trading
on the New York Stock Exchange, Inc. See
"Underwriting" herein.
Use of Proceeds.............
All of the proceeds to the Issuer Trust from the
sale of the Preferred Securities will be invested
by the Issuer Trust in the Junior Subordinated
Debentures. The net proceeds to the Corporation
from the sale of the Junior Subordinated
Debentures will be used by the Corporation for
general corporate purposes, which may include
investments in, or extensions of credit to, the
Corporation's subsidiaries and the repurchase
and/or redemption of preferred stock of the
Corporation. Specific allocations of the proceeds
to such purposes have not been made, although
management has determined that funds should be
borrowed at this 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. Pending such
applications, such net proceeds may be
temporarily invested. See "Use of Proceeds"
herein.
For additional information regarding the Preferred Securities, see "Certain
Terms of Preferred Securities", "Certain Terms of Junior Subordinated
Debentures", "Certain Terms of Guarantee" and "Certain Federal Income Tax
Consequences" in this Prospectus Supplement and "Description of Preferred
Securities", "Description of Junior Subordinated Debentures", "Description of
Guarantees", "Description of Expense Agreements" and "Relationship among the
Preferred Securities, the Corresponding Junior Subordinated Debentures, the
Guarantees and the Expense Agreements" in the accompanying Prospectus.
RISK FACTORS
Prospective investors should carefully consider the matters set forth under
"Risk Factors".
S-6
<PAGE>
The information in this Prospectus Supplement supplements and should be read
in conjunction with the information contained in the accompanying Prospectus.
As used herein, (i) the "Junior Subordinated Indenture" means the Junior
Subordinated Indenture, dated as of February , 1997, as amended and
supplemented from time to time, between the Corporation and Wilmington Trust
Company, as trustee (the "Debenture Trustee"), pursuant to which the Junior
Subordinated Debentures are issued, (ii) the "Declaration of Trust" means the
Amended and Restated Declaration of Trust relating to the Issuer Trust, dated
as of February , 1997, as amended and supplemented from time to time, among
the Corporation, as Depositor, Wilmington Trust Company, as Property Trustee
(the "Property Trustee"), Wilmington Trust Company, as Delaware Trustee (the
"Delaware Trustee") and the Administrative Trustees named therein (the
"Administrative Trustees") (collectively the "Issuer Trustees"), and the
Holders of the Trust Securities from time to time, (iii) the "Guarantee" means
the Guarantee Agreement, dated as of February , 1997, relating to the
Preferred Securities, as amended and supplemented from time to time, between
the Corporation and Wilmington Trust Company, as Guarantee Trustee (the
"Guarantee Trustee"), and (iv) the "Expense Agreement" means the Agreement as
to Expenses and Liabilities, dated as of February , 1997, as amended and
supplemented from time to time, between the Corporation and the Issuer Trust.
Each of the other capitalized terms used and not otherwise defined in this
Prospectus Supplement has the meaning set forth in the accompanying
Prospectus.
RISK FACTORS
Prospective purchasers of the Preferred Securities should carefully review
the information contained elsewhere in this Prospectus Supplement and in the
accompanying Prospectus and should particularly consider the following
matters. In addition, because holders of Preferred Securities may receive
Junior Subordinated Debentures in exchange therefor upon liquidation of the
Issuer Trust, prospective purchasers of Preferred Securities are also making
an investment decision with regard to the Junior Subordinated Debentures and
should carefully review all the information regarding the Junior Subordinated
Debentures contained herein.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES
The obligations of the Corporation under the Guarantee issued by the
Corporation for the benefit of the holders of Preferred Securities and under
the Junior Subordinated Debentures are subordinate and junior in right of
payment to all Senior Indebtedness of the Corporation. Substantially all of
the Corporation's existing indebtedness constitutes Senior Indebtedness.
Because the Corporation is a holding company, the right of the Corporation to
participate in any distribution of assets of any subsidiary, including
Bankers, upon such subsidiary's dissolution, winding-up, liquidation or
reorganization or otherwise (and thus the ability of holders of the Preferred
Securities to benefit indirectly from such distribution), is 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. There are various legal limitations on the extent to which certain
of the Corporation's subsidiaries may extend credit, pay dividends or
otherwise supply funds to, or engage in transactions with, the Corporation or
certain of its other subsidiaries. Accordingly, the Junior Subordinated
Debentures and the Guarantee will be effectively subordinated to all existing
and future liabilities of the Corporation's subsidiaries, and holders of
Junior Subordinated Debentures and the Guarantee should look only to the
assets of the Corporation for payments on the Junior Subordinated Debentures
and the Guarantee. See "Bankers Trust New York Corporation" herein. None of
the Junior Subordinated Indenture, the Guarantee, the Declaration of Trust or
the Expense Agreement places any limitation on the amount of secured or
unsecured debt, including Senior Indebtedness, that may be incurred by the
Corporation. See "Description of Guarantees--Status of the Guarantees" and
"Description of Junior Subordinated Debentures--Subordination" in the
accompanying Prospectus.
The ability of the Issuer Trust to pay amounts due on the Preferred
Securities is solely dependent upon the Corporation's making payments on the
Junior Subordinated Debentures as and when required.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES
So long as no Event of Default (as defined in the Junior Subordinated
Indenture) has occurred and is continuing with respect to the Junior
Subordinated Debentures (a "Debenture Event of Default"), the
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Corporation has the right under the Junior Subordinated Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 20 consecutive quarters with respect
to each Extension Period, provided that no Extension Period may extend beyond
the Stated Maturity of the Junior Subordinated Debentures as in effect at the
time of the Corporation's election to defer interest in this manner. See
"Description of Junior Subordinated Debentures--Debenture Events of Default"
in the accompanying Prospectus. As a consequence of any such deferral,
quarterly Distributions on the Preferred Securities by the Issuer Trust will
also be deferred (and the amount of Distributions to which holders of the
Preferred Securities are entitled will accumulate additional Distributions
thereon at the rate of % per annum, compounded quarterly from the relevant
payment date for such Distributions) during any such Extension Period. During
any such Extension Period, the Corporation may not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to the Junior
Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Corporation in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants,
in connection with a dividend reinvestment or stockholder stock purchase plan
or in connection with the issuance of capital stock of the Corporation (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock
of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any stockholder's rights plan, or the issuance of
rights, stock or other property under any stockholder's rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in
the form of stock, warrants, options or other rights where the dividend stock
or the stock issuable upon exercise of such warrants, options or other rights
is the same stock as that on which the dividend is being paid or ranks pari
passu with or junior to such stock). Prior to the termination of any such
Extension Period, the Corporation may further defer the payment of interest,
provided that no Extension Period may exceed 20 consecutive quarterly periods
or extend beyond the Stated Maturity of the Junior Subordinated Debentures as
in effect at the time of the Corporation's election to defer interest in this
manner. Upon the termination of any such Extension Period and the payment of
all amounts then due, the Corporation may elect to begin a new Extension
Period subject to the above conditions. There is no limitation on the number
of times that the Corporation may elect to begin an Extension Period. See
"Certain Terms of Preferred Securities--Distributions" and "Certain Terms of
Junior Subordinated Debentures--Option to Defer Interest Payments" herein.
If an Extension Period occurs, a holder of Preferred Securities will
continue to accrue income (in the form of original issue discount) in respect
of its pro rata share of the Junior Subordinated Debentures held by the Issuer
Trust for United States federal income tax purposes. As a result, a holder of
Preferred Securities will include such income in gross income for United
States federal income tax purposes in advance of the receipt of cash, and will
not receive the cash related to such income from the Issuer Trust if the
holder disposes of the Preferred Securities prior to the record date for the
payment of Distributions. See "Certain Federal Income Tax Consequences--
Interest Income and Original Issue Discount" and "--Sales or Redemption of
Preferred Securities" herein.
The Corporation has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures. However, if the Corporation were to elect to exercise
such right in the future, the market price of the Preferred Securities is
likely to be affected. A holder that disposes of its Preferred Securities
during an Extension Period, therefore, might not receive the same return on
its investment as a holder that continues to hold its Preferred Securities. In
addition, as a result of the existence of the Corporation's right to defer
interest payments, the market price of the Preferred Securities (which
represent
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preferred undivided beneficial interests in the assets of the Issuer Trust)
may be more volatile than the market prices of other securities on which
original issue discount accrues that are not subject to such deferrals.
TAX EVENT, INVESTMENT COMPANY EVENT OR CAPITAL TREATMENT EVENT REDEMPTION
The Corporation has the right, if certain conditions are met, to redeem the
Junior Subordinated Debentures in whole (but not in part) at any time within
90 days following the occurrence and during the continuation of a Tax Event,
Investment Company Event or Capital Treatment Event (or, if the approval of
the Federal Reserve is then required for such redemption, on such later date
as promptly as is reasonably practicable after such approval is obtained). If
the Corporation redeems the Junior Subordinated Debentures, it will thereby
cause a mandatory redemption of the Preferred Securities. Any such redemption
will be at a price equal to 100% of the Liquidation Amount of such Preferred
Securities plus accumulated and unpaid Distributions to but excluding the date
fixed for redemption. The Corporation has committed to the Federal Reserve
that it will not exercise such right unless it has received prior approval of
the Federal Reserve to do so, if then required under applicable Federal
Reserve capital guidelines or policies.
See "--Possible Tax Law Changes" herein for a discussion of certain
legislative proposals that, if adopted, could give rise to a Tax Event, which
may permit the Corporation to cause a redemption of the Preferred Securities
prior to February , 2002.
EXCHANGE OF PREFERRED SECURITIES FOR JUNIOR SUBORDINATED DEBENTURES
The holder of all the Common Securities has the right at any time to
dissolve the Issuer Trust and, after satisfaction of liabilities to creditors
of the Issuer Trust as provided by applicable law, cause the Junior
Subordinated Debentures to be distributed to the holders of the Preferred
Securities and Common Securities in liquidation of the Issuer Trust. The
Corporation has committed to the Federal Reserve that, so long as the
Corporation (or any affiliate) is the holder of all the Common Securities, the
Corporation (or such affiliate) will not exercise such right without having
received the prior approval of the Federal Reserve to do so, if then required
under applicable Federal Reserve capital guidelines or policies. See "Certain
Terms of Preferred Securities--Liquidation of Issuer Trust and Distribution of
Junior Subordinated Debentures" herein.
Under current United States federal income tax law and interpretations and
assuming, as expected, that the Issuer Trust will not be taxable as a
corporation, a distribution of the Junior Subordinated Debentures upon a
liquidation of the Issuer Trust should not be a taxable event to holders of
the Preferred Securities. However, if a Tax Event were to occur that would
cause the Issuer Trust to be subject to United States federal income tax with
respect to income received or accrued on the Junior Subordinated Debentures, a
distribution of the Junior Subordinated Debentures by the Issuer Trust could
be a taxable event to the Issuer Trust and the holders of the Preferred
Securities. See "Certain Federal Income Tax Consequences--Distribution of
Junior Subordinated Debentures to Beneficial Owners" herein.
SHORTENING OF STATED MATURITY OF JUNIOR SUBORDINATED DEBENTURES
The Corporation will have the right at any time to shorten the maturity of
the Junior Subordinated Debentures to a date not earlier than February , 2002
and thereby cause the Preferred Securities to be redeemed on such earlier
date. The Corporation has committed to the Federal Reserve that the
Corporation will not exercise such right without having received prior
approval of the Federal Reserve to do so, if then required under applicable
Federal Reserve capital guidelines or policies.
MARKET PRICES
There can be no assurance as to the market prices for Preferred Securities,
or for Junior Subordinated Debentures that may be distributed in exchange for
Preferred Securities if a liquidation of the Issuer Trust occurs. Accordingly,
the Preferred Securities or the Junior Subordinated Debentures that a holder
of Preferred Securities
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<PAGE>
may receive on liquidation of the Issuer Trust may trade at a discount to the
price that the investor paid to purchase the Preferred Securities offered
hereby. As a result of the existence of the Corporation's right to defer
interest payments, the market price of the Preferred Securities (which
represent preferred beneficial interests in the assets of the Issuer Trust)
may be more volatile than the market prices of other securities on which
original issue discount accrues that are not subject to such deferrals. In
addition, because the Corporation has the right to shorten the Stated Maturity
of the Junior Subordinated Debentures (subject to its commitment to the
Federal Reserve not to do so without the Federal Reserve's prior approval, if
such approval is then required under applicable Federal Reserve guidelines or
policies), there can be no assurance that the Corporation will not exercise
its option to change the maturity of the Junior Subordinated Debentures as
permitted by the terms thereof and of the Junior Subordinated Indenture. If
the Corporation does exercise such option, there can be no assurance that the
shortening of the maturity of the Junior Subordinated Debentures will not have
an effect on the market price of the Preferred Securities. See "Description of
Junior Subordinated Debentures" in the accompanying Prospectus.
RIGHTS UNDER THE GUARANTEE; DIRECT ACTION
Wilmington Trust Company will act as the Guarantee Trustee and will hold the
Guarantee for the benefit of the holders of the Preferred Securities.
Wilmington Trust Company will also act as Debenture Trustee for the Junior
Subordinated Debentures and as Property Trustee and Delaware Trustee under the
Declaration of Trust. The Guarantee guarantees to the holders of the Preferred
Securities the following payments, to the extent not paid by the Issuer Trust:
(i) any accumulated and unpaid Distributions required to be paid on the
Preferred Securities, to the extent that the Issuer Trust has funds on hand
available therefor at such time, (ii) the Redemption Price with respect to any
Preferred Securities called for redemption, to the extent that the Issuer
Trust has funds on hand available therefor at such time, and (iii) upon a
voluntary or involuntary dissolution, winding-up or liquidation of the Issuer
Trust (unless the Junior Subordinated Debentures are distributed to holders of
the Trust Securities), the lesser of (a) the aggregate of the Liquidation
Amount and all accumulated and unpaid Distributions to the date of payment, to
the extent that the Issuer Trust has funds on hand available therefor at such
time, and (b) the amount of assets of the Issuer Trust remaining available for
distribution to holders of the Preferred Securities on liquidation of the
Issuer Trust after satisfaction of liabilities to creditors of the Issuer
Trust as provided by applicable law. The Guarantee will be qualified as an
indenture under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). The Guarantee is subordinate as described under "Description
of Guarantees--Status of Guarantees" in the applicable Prospectus.
The holders of not less than a majority in aggregate Liquidation Amount of
the outstanding Preferred Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of the Guarantee or to direct the exercise of any
trust power conferred upon the Guarantee Trustee under the Guarantee. Any
holder of the Preferred Securities may institute a legal proceeding directly
against the Corporation to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Issuer Trust, the Guarantee
Trustee or any other person or entity. If the Corporation were to default on
its obligation to pay amounts payable under the Junior Subordinated
Debentures, the Issuer Trust would lack funds for the payment of Distributions
or amounts payable on redemption of the Preferred Securities or otherwise,
and, in such event, holders of the Preferred Securities would not be able to
rely upon the Guarantee for payment of such amounts. Instead, if a Debenture
Event of Default has occurred and is continuing and such event is attributable
to the failure of the Corporation to pay any amounts in respect of the Junior
Subordinated Debentures on the date on which such payment is due and payable,
then a holder of Preferred Securities may institute a legal proceeding
directly against the Corporation for enforcement of payment to such holder of
any amounts payable in respect of Junior Subordinated Debentures having a
principal amount equal to the aggregate Liquidation Amount of the Preferred
Securities of such holder (a "Direct Action"). In connection with such Direct
Action, the Corporation will have a right of set-off under the Junior
Subordinated Indenture to the extent of any payment made by the Corporation to
such holder of Preferred Securities in the Direct Action. Except as described
herein, holders of Preferred Securities will not be able to exercise directly
any other remedy available to the holders of the Junior Subordinated
Debentures or assert directly any other
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<PAGE>
rights in respect of the Junior Subordinated Debentures. See "Description of
Junior Subordinated Debentures--Debenture Events of Default", "--Enforcement
of Certain Rights by Holders of Preferred Securities" and "Description of
Guarantees" in the accompanying Prospectus. The Declaration of Trust provides
that each holder of Preferred Securities by acceptance thereof agrees to the
provisions of the Guarantee and the Junior Subordinated Indenture.
LIMITED VOTING RIGHTS
Holders of Preferred Securities will have limited voting rights relating
generally to the modification of the Preferred Securities and the Guarantee
and the exercise of the Issuer Trust's rights as holder of the Junior
Subordinated Debentures. Holders of Preferred Securities will not be entitled
to appoint, remove or replace the Property Trustee or the Delaware Trustee
except upon the occurrence of certain events described in the accompanying
Prospectus. The Issuer Trustees and the holder of all the Common Securities
may, subject to certain conditions, amend the Declaration of Trust without the
consent of holders of Preferred Securities to cure any ambiguity or make other
provisions not inconsistent with other provisions under the Declaration of
Trust to ensure that the Issuer Trust (i) will not be taxable as a corporation
or as other than a grantor trust for United States federal income tax
purposes, or (ii) will not be required to register as an "investment company"
under the Investment Company Act. See "Description of Preferred Securities--
Removal of Issuer Trustees" and "--Voting Rights; Amendment of Each
Declaration of Trust" in the accompanying Prospectus.
TRADING CHARACTERISTICS OF PREFERRED SECURITIES
Application will be made to list the Preferred Securities on the New York
Stock Exchange, Inc. The Preferred Securities may trade at prices that do not
fully reflect the value of accrued but unpaid interest with respect to the
underlying Junior Subordinated Debentures. A holder of Preferred Securities
that disposes of its Preferred Securities between record dates for payments of
Distributions (and consequently does not receive a Distribution from the
Issuer Trust for the period prior to such disposition) will nevertheless be
required to include accrued but unpaid interest on the Junior Subordinated
Debentures through the date of disposition in income as ordinary income and to
add such amount to its adjusted tax basis in the Preferred Securities disposed
of. Such holder will recognize a capital loss to the extent that the selling
price (which may not fully reflect the value of accrued but unpaid interest)
is less than its adjusted tax basis (which will include accrued but unpaid
interest). Subject to certain limited exceptions, capital losses cannot be
applied to offset ordinary income for United States federal income tax
purposes. See "Certain Federal Income Tax Consequences--Sales or Redemptions
of Preferred Securities" herein.
As indicated above, application will be made to list the Preferred
Securities on the New York Stock Exchange, Inc. If the Preferred Securities
are not listed on a national securities exchange or the NASDAQ National Market
and the Underwriters do not make a market for the securities, the liquidity of
the Preferred Securities could be adversely affected.
POSSIBLE TAX LAW CHANGES AFFECTING THE PREFERRED SECURITIES
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the
revenue portion of President Clinton's budget proposal, was released. If it
had been enacted, the Bill would have generally denied interest deductions for
interest on an instrument issued by a corporation that has a maximum term of
more than 20 years and that is not shown as indebtedness on the separate
balance sheet of the issuer or, where the instrument is issued to a related
party (other than a corporation), where the holder or some other related party
issues a related instrument that is not shown as indebtedness on the issuer's
consolidated balance sheet. For purposes of determining the weighted average
maturity or the term of an instrument, any right to extend would be treated as
exercised. If similar provisions were to apply to the Junior Subordinated
Debentures, the Corporation would be unable to deduct interest on the Junior
Subordinated Debentures. On March 29, 1996, the Chairmen of the Senate Finance
and House Ways and Means Committees issued a joint statement to the effect
that it was their intention that the effective date of the President's
legislative proposals, if adopted, would be no earlier than the date of
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appropriate Congressional action. Under current law, the Corporation will be
able to deduct interest on the Junior Subordinated Debentures. There can be no
assurance, however, that current or future legislative proposals or final
legislation will not affect the ability of the Corporation to deduct interest
on the Junior Subordinated Debentures. Such a change could give rise to a Tax
Event, which may permit the Corporation, if certain conditions are met, to
cause a redemption of the Preferred Securities before February , 2002. See
"Certain Terms of Junior Subordinated Debentures--Redemption" and "Certain
Terms of Preferred Securities--Redemption" herein and "Description of
Preferred Securities--Redemption or Exchange" and "Description of Junior
Subordinated Debentures--Redemption" in the accompanying Prospectus. See also
"Certain Federal Income Tax Consequences--Possible Tax Law Changes" herein.
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 December 31, 1996, the Corporation had
consolidated total assets of $120.2 billion. The Corporation's principal
banking subsidiary is 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 Investment
Banking, Risk Management Services, Trading & Sales, Investment Management,
Client Processing Services, Australia/New Zealand, Asia, Latin America and
Corporate. Among the institutional market segments served are corporations,
banks, other financial institutions, governments and agencies, retirement
plans, not-for-profit organizations, wealthy individuals, foundations and
private companies. 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 certain of the Corporation's 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 short-term borrowings and accounts payable.
The Corporation's principal executive offices are located at 130 Liberty
Street, New York, New York 10006 and its telephone number is (212) 250-2500.
CONSOLIDATED RESULTS OF OPERATIONS
The Corporation earned $612 million, or $6.78 primary earnings per share,
for the full year 1996 compared with $215 million, or $2.03 primary earnings
per share, in 1995.
The Corporation earned $147 million, or $1.59 primary earnings per share, in
the fourth quarter of 1996 compared with $176 million, or $1.99 primary
earnings per share, in the third quarter of 1996 and $126 million, or $1.36
primary earnings per share, in the fourth quarter of 1995.
Details with respect to the foregoing are set forth in the Corporation's
Current Report on Form 8-K dated January 23, 1997, which is incorporated
herein by reference.
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SELECTED CONSOLIDATED FINANCIAL DATA AND OTHER INFORMATION
The following selected consolidated financial data at and for each of the
two years ended December 31, 1995, have been derived from and are qualified in
their entirety by the detailed financial information and consolidated
financial statements of the Corporation included in its Annual Report on Form
10-K for the year ended December 31, 1995 ("Form 10-K") which is incorporated
herein by reference.
The following selected consolidated financial data at and for the year ended
December 31, 1996 are unaudited but, in the opinion of management, all
material adjustments necessary for a fair presentation of the Corporation's
results of operations for such period have been made. All such adjustments
were of a normal recurring nature.
<TABLE>
<CAPTION>
AT OR FOR THE
YEAR ENDED DECEMBER 31,
-------------------------
1994 1995 1996
------- -------- --------
($ IN MILLIONS, EXCEPT
PER SHARE DATA)
<S> <C> <C> <C>
Condensed Consolidated Statement of Income:
Interest revenue.................................... $ 5,030 $ 5,886 $ 6,439
Interest expense.................................... 3,858 5,069 5,473
------- -------- --------
Net interest revenue................................ 1,172 817 966
Provision for credit losses......................... 25 31 5
------- -------- --------
Net interest revenue after provision for credit
losses............................................. 1,147 786 961
Noninterest revenue................................. 2,473 2,423 3,199
Noninterest expenses................................ 2,751 2,898 3,288
------- -------- --------
Income before income taxes.......................... 869 311 872
Income taxes........................................ 254 96 260
------- -------- --------
Net income.......................................... $ 615 $ 215 $ 612
======= ======== ========
Net income applicable to common stock............... $ 587 $ 164 $ 561
======= ======== ========
Per Common Share Data:
Primary earnings per share.......................... $ 7.17 $ 2.03 $ 6.78
Fully diluted earnings per share.................... 7.17 2.02 6.74
Cash dividends declared............................. 3.70 4.00 4.00
--as a percentage of net income.................... 52% 198% 59%
Book value(1)....................................... $ 53.67 $ 50.58 $ 53.27
Profitability Ratios:
Return on average common stockholders' equity....... 13.48% 3.98% 12.92%
Return on average total assets...................... .59 .20 .51
Consolidated Balances, End of Period:
Trading assets...................................... $47,514 $ 47,893 $ 48,919
Loans............................................... 12,501 12,633 15,826
Total assets........................................ 97,016 104,002 120,235
Deposits............................................ 24,939 25,708 30,315
Securities sold under repurchase agreements......... 15,617 15,247 23,000
Other short-term borrowings......................... 18,222 15,761 19,395
Long-term debt not included in risk-based capital... 4,230 6,934 8,533
Long-term debt included in risk-based capital....... 2,225 2,360 2,576
Mandatorily redeemable capital securities of sub-
sidiary trusts holding solely junior subordinated
deferrable interest debentures included in risk-
based capital...................................... -- -- 730
Common stockholders' equity......................... 4,309 4,119 4,424
Total stockholders' equity.......................... 4,704 4,984 5,234
Consolidated Capital Ratios, End of Period:
Common stockholders' equity to total assets......... 4.4% 4.0% 3.7%
Total stockholders' equity to total assets.......... 4.8 4.8 4.4
Risk-based capital ratios(2)
Tier 1 Capital.................................... 9.1 8.5 8.5
Total Capital..................................... 14.8 13.9 13.4
Leverage Ratio...................................... 5.3 5.1 5.5
EMPLOYEES............................................ 14,529 14,069 15,228
</TABLE>
- --------
(1) This calculation includes the effect of the vested portion of common
shares issuable under deferred stock awards.
(2) At December 31, 1996, December 31, 1995 and December 31, 1994, all three
regulatory capital ratios excluded any benefit from the adoption of SFAS
115. Regulatory capital ratios at December 31, 1996 are preliminary.
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<PAGE>
BT PREFERRED CAPITAL TRUST I
The Issuer Trust is a statutory business trust created under Delaware law
pursuant to the filing of a certificate of trust with the Delaware Secretary
of State on October 29, 1996, which will be governed by the Declaration of
Trust among the Corporation, as Depositor, Wilmington Trust Company, as
Property Trustee and Delaware Trustee, the Administrative Trustees named
therein and the Holders of the Trust Securities from time to time. The Issuer
Trust's business and affairs are conducted by its trustees: initially
Wilmington Trust Company, as Property Trustee and Delaware Trustee, and the
Administrative Trustees. Two individuals who are employees or officers of or
affiliated with the holder of all the Common Securities will act as the
Administrative Trustees with respect to the Issuer Trust. The Administrative
Trustees will be selected by the holder of all the Common Securities. See
"Description of Preferred Securities--Miscellaneous" in the accompanying
Prospectus. The Issuer Trust exists for the exclusive purposes of (i) issuing
and selling the Trust Securities, (ii) using the proceeds from the sale of the
Trust Securities to acquire the Junior Subordinated Debentures and (iii)
engaging in only those other activities necessary or incidental thereto (such
as registering the transfer of the Preferred Securities). Accordingly, the
Junior Subordinated Debentures will be the sole assets of the Issuer Trust,
and payments under the Junior Subordinated Debentures will be the sole source
revenue of the Issuer Trust.
All of the Common Securities will initially be owned by the Corporation. The
Common Securities will rank pari passu, and payments will be made thereon pro
rata, with the Preferred Securities, except that upon the occurrence and
during the continuation of a Debenture Event of Default arising as a result of
any failure by the Corporation to pay any amounts under the Junior
Subordinated Debentures when due, the rights of the holder of all the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption or otherwise will be subordinated to the rights of the
holders of the Preferred Securities. See "Description of Preferred
Securities--Subordination of Common Securities" in the accompanying
Prospectus. The Corporation will acquire Common Securities in an aggregate
liquidation amount equal to approximately 3% of the total capital of the
Issuer Trust. The Issuer Trust has a term of 41 years, but may terminate
earlier as provided in the Declaration of Trust. The principal executive
office of the Issuer Trust is c/o Bankers Trust New York Corporation, 130
Liberty Street, New York, New York 10006, Attention: Office of the Secretary,
and its telephone number is (212) 250-2500. See "The Issuer Trusts" in the
accompanying Prospectus.
It is anticipated that the Issuer Trust will not be subject to the reporting
requirements under the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
USE OF PROCEEDS
All of the proceeds to the Issuer Trust from the sale of the Preferred
Securities will be invested by the Issuer Trust in the Junior Subordinated
Debentures. The net proceeds to the Corporation from the sale of the Junior
Subordinated Debentures will be used by the Corporation for general corporate
purposes, which may include investments in, or extensions of credit to, the
Corporation's subsidiaries and the repurchase and/or redemption of preferred
stock of the Corporation. Specific allocations of the proceeds to such
purposes have not been made, although management has determined that funds
should be borrowed at this 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.
Pending such applications, such net proceeds may be temporarily invested.
ACCOUNTING TREATMENT
For financial reporting purposes, the Issuer Trust will be treated as a
subsidiary of the Corporation and, accordingly, the accounts of the Issuer
Trust will be included in the consolidated financial statements of the
Corporation. The Preferred Securities will be presented as a separate line
item in the consolidated balance sheets of the Corporation, entitled
"Mandatorily Redeemable Capital Securities of Subsidiary Trusts Holding Solely
Junior Subordinated Deferrable Interest Debentures Included in Risk-Based
Capital" and appropriate disclosures about the Preferred Securities, the
Guarantee and the Junior Subordinated Debentures will be included in the notes
to the consolidated financial statements. For financial reporting purposes,
the Corporation will record Distributions payable on the Preferred Securities
as an expense in the consolidated statements of income.
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<PAGE>
The Corporation has agreed that future financial reports of the Corporation
will: (i) present the capital or preferred securities issued by other issuer
trusts of the Corporation on the Corporation's balance sheet as a separate
line term entitled "Mandatorily Redeemable Capital Securities of Subsidiary
Trusts Holding Solely Junior Subordinated Deferrable Interest Debentures
Included in Risk-Based Capital"; (ii) include in a footnote to the financial
statements disclosure that the sole assets of such trusts are the junior
subordinated debentures (specifying as to each trust the principal amount,
interest rate and maturity date of junior subordinated debentures held); and
(iii) if Staff Accounting Bulletin 53 treatment is sought, then include, in an
audited footnote to the financial statements, disclosure that (a) the trusts
are wholly owned, (b) the sole assets of the trusts are the junior
subordinated debentures (specifying as to each trust the principal amount,
interest rate and maturity date of the junior subordinated debentures held),
and (c) the obligations of the Corporation under the junior subordinated
debentures, the Junior Subordinated Indenture, the relevant Declarations of
Trust, the Guarantees and the Expense Agreements, in the aggregate, constitute
a full and unconditional guarantee by the Corporation of the trusts'
obligations under the Preferred Securities issued by each trust. See
"Relationship Among the Preferred Securities, the Corresponding Junior
Subordinated Debentures, the Guarantees and the Expense Agreements" in the
accompanying Prospectus.
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<PAGE>
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Corporation and its subsidiaries as of December 31, 1996, and as adjusted to
give effect to the consummation of the offering of the Preferred Securities as
if such transaction had occurred on December 31, 1996. The following data
should be read in conjunction with the consolidated financial statements and
notes thereto of the Corporation and its subsidiaries incorporated herein by
reference.
<TABLE>
<CAPTION>
AT DECEMBER 31, 1996
------------------------
ACTUAL AS ADJUSTED
---------- ------------
($ IN MILLIONS)
<S> <C> <C>
Debt:
Short-term borrowings.............................. $ 42,395 $ 42,395
Long-term debt not included in risk-based capital.. 8,533 8,533
Long-term debt included in risk-based capital...... 2,576 2,576
Mandatorily redeemable capital securities of
subsidiary trusts holding solely junior
subordinated deferrable interest debentures
included in risk-based capital(1)................. 730 930
---------- ----------
Total debt....................................... $ 54,234 $ 54,434
Preferred stock of subsidiary........................ 250 250
Stockholders' equity:
Preferred stock.................................... 810 810
Common stock ($1 par value; authorized shares:
300,000,000; issued shares: 83,678,973; outstand-
ing: 79,243,747).................................. 84 84
Capital surplus.................................... 1,339 1,339
Retained earnings.................................. 3,462 3,462
Common stock in treasury, at cost (4,435,226
shares)........................................... (372) (372)
Other stockholders' equity......................... (89) (89)
---------- ----------
Total stockholders' equity....................... 5,234 5,234
---------- ----------
Total capitalization............................. $ 59,718 $ 59,918
========== ==========
</TABLE>
- --------
(1) This item, as adjusted, includes the Preferred Securities issued by the
Issuer Trust. The sole assets of the Issuer Trust will be the Junior
Subordinated Debentures, issued by the Corporation to the Issuer Trust.
The Junior Subordinated Debentures held by the Issuer Trust will bear
interest at a rate equal to % per annum, and will mature on February ,
2037. The Corporation initially will own all of the Common Securities of
the Issuer Trust. It is anticipated that the Issuer Trust will not be
subject to the reporting requirements of the Exchange Act. See "Accounting
Treatment".
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<PAGE>
CERTAIN TERMS OF PREFERRED SECURITIES
GENERAL
The following summary of certain terms and provisions of the Preferred
Securities supplements the description of the terms and provisions of the
Preferred Securities set forth in the accompanying Prospectus under the heading
"Description of Preferred Securities", to which description reference is hereby
made. This summary of certain terms and provisions of the Preferred Securities,
which describes the material provisions thereof, does not purport to be
complete and is subject to, and qualified in its entirety by reference to, the
Declaration of Trust, to which reference is hereby made. The Declaration of
Trust will be qualified as an indenture under the Trust Indenture Act.
Wilmington Trust Company, as Property Trustee, will act as trustee for the
purposes of compliance with the Trust Indenture Act. The form of the
Declaration of Trust has been filed as an exhibit to the Registration Statement
of which this Prospectus Supplement and the accompanying Prospectus form a
part.
DISTRIBUTIONS
The Preferred Securities represent preferred undivided beneficial interests
in the assets of the Issuer Trust, and Distributions on each Preferred Security
will be payable at the annual rate of % of the stated Liquidation Amount of
$25, payable quarterly in arrears on January , April , July and October
of each year (each a "Distribution Date"), to the holders of the Preferred
Securities at the close of business on the fifteenth day (whether or not a
Business Day (as defined under "Description of Preferred Securities--
Distributions" in the accompanying Prospectus)) next preceding the relevant
Distribution Date. Distributions on the Preferred Securities will be
cumulative. Distributions will accumulate from February , 1997. The first
Distribution Date for the Preferred Securities will be April , 1997. The
amount of Distributions payable for any period less than a full Distribution
period will be computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. Distributions
payable for each full Distribution period will be computed by dividing the rate
per annum by four. If any date on which Distributions are payable on the
Preferred Securities is not a Business Day, then payment of the Distributions
payable on such date will be made on the next succeeding day that is a Business
Day (without any additional Distributions or other payment in respect of any
such delay, except that, if such Business Day is in the next succeeding
calendar year, such payment will be made on the immediately preceding Business
Day, in each case with the same force and effect as if made on the date such
payment was originally payable. The Paying Agent for the Preferred Securities
will initially be Wilmington Trust Company. See "Description of Preferred
Securities--Distributions" in the accompanying Prospectus.
So long as no Debenture Event of Default has occurred and is continuing, the
Corporation has the right under the Junior Subordinated Indenture to defer the
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 20 consecutive quarters with respect to
each Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Junior Subordinated Debentures as in effect at the time
of the Corporation's election to defer interest in this manner. As a
consequence of any such election, quarterly Distributions on the Preferred
Securities will be deferred by the Issuer Trust during any such Extension
Period. Distributions to which holders of the Preferred Securities are entitled
will accumulate additional Distributions thereon at the rate per annum of %
thereof, compounded quarterly from the relevant payment date for such
Distributions, computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. Additional
Distributions payable for each full Distribution period will be computed by
dividing the rate per annum by four. The term "Distributions" as used herein
shall include any such additional Distributions. During any such Extension
Period, the Corporation may not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock or (ii) make any
payment of principal of or interest or premium, if any, on or repay, repurchase
or redeem any debt securities of the Corporation that rank pari passu in all
respects with or junior in interest to the Junior Subordinated Debentures
(other than (a) repurchases, redemptions or other acquisitions of shares of
capital stock of the Corporation in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of any one or
more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Corporation (or
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<PAGE>
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock of
a subsidiary of the Corporation) for any class or series of the Corporation's
capital stock or of any class or series of the Corporation's indebtedness for
any class or series of the Corporation's capital stock, (c) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (d) any declaration of a dividend in connection
with any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase
of rights pursuant thereto, or (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that on
which the dividend is being paid or ranks pari passu with or junior to such
stock). Prior to the termination of any such Extension Period, the Corporation
may further defer the payment of interest, provided that no Extension Period
may exceed 20 consecutive quarters or extend beyond the Stated Maturity of the
Junior Subordinated Debentures as in effect at the time of the Corporation's
election to defer interest in this manner. Upon the termination of any such
Extension Period and the payment of all amounts then due, the Corporation may
elect to begin a new Extension Period. There is no limitation on the number of
times that the Corporation may elect to begin an Extension Period. See "Certain
Terms of Junior Subordinated Debentures--Option to Defer Interest Payments" and
"Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount" herein.
The Corporation has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures.
REDEMPTION
The Corporation has the right to redeem the Junior Subordinated Debentures
(i) on or after February , 2002, in whole at any time or in part from time to
time, or (ii) in certain circumstances as described under "Description of
Junior Subordinated Debentures--Conditional Right to Redeem Upon a Tax Event,
Investment Company Event or Capital Treatment Event", in whole (but not in
part) at any time within 90 days following the occurrence and during the
continuation of a Tax Event, Investment Company Event or Capital Treatment
Event (each as defined under "Certain Terms of the Junior Subordinated
Debentures--Conditional Right to Redeem Upon a Tax Event, Investment Company
Event or Capital Treatment Event" herein) (or, if the approval of the Federal
Reserve is then required for such redemption, on such later date as promptly as
reasonably practicable after such approval is obtained). Upon the repayment or
redemption, in whole or in part, of the Junior Subordinated Debentures, whether
at Stated Maturity or upon earlier redemption as provided in the Junior
Subordinated Indenture, the proceeds from such repayment or redemption will be
applied by the Property Trustee to redeem a Like Amount (as defined under
"Description of Preferred Securities--Redemption or Exchange" in the
accompanying Prospectus) of the Trust Securities, upon not less than 30 nor
more than 60 days' notice, at a redemption price (the "Redemption Price") equal
to 100% of the aggregate Liquidation Amount of such Preferred Securities plus
accumulated but unpaid Distributions thereon to the date fixed for redemption
(the "Redemption Date") and the related amount of the premium, if any, paid by
the Corporation upon the concurrent redemption of such Junior Subordinated
Debentures. See "Description of Preferred Securities--Redemption or Exchange"
in the accompanying Prospectus.
For a description of the Stated Maturity and redemption provisions of the
Junior Subordinated Debentures, see "Certain Terms of Junior Subordinated
Debentures--General" and "--Redemption" herein.
LIQUIDATION OF ISSUER TRUST AND DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
The holder of all the Common Securities will have the right at any time to
dissolve the Issuer Trust and, after satisfaction of liabilities to creditors
of the Issuer Trust as provided by applicable law, to cause the Junior
Subordinated Debentures to be distributed to the holders of the Preferred
Securities and Common Securities in liquidation of the Issuer Trust. The
Corporation has committed to the Federal Reserve that, so long as the
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<PAGE>
Corporation (or any affiliate) is the holder of all the Common Securities, the
Corporation (or such affiliate) will not exercise such right without having
received the prior approval of the Federal Reserve to do so, if then required
under applicable Federal Reserve capital guidelines or policies.
Under current United States Federal income tax law and interpretations and
assuming, as expected, that the Issuer Trust will not be taxable as a
corporation, a distribution of Junior Subordinated Debentures upon a
liquidation of the Issuer Trust should not be a taxable event to holders of the
Preferred Securities. If there is a change in law, a change in legal
interpretation, a Tax Event or other circumstances, however, the distribution
of the Junior Subordinated Debentures could be a taxable event to the Issuer
Trust and the holders of the Preferred Securities. See "Certain Federal Income
Tax Consequences--Distribution of Junior Subordinated Debentures to Beneficial
Owners" herein.
If the Corporation does not redeem the Junior Subordinated Debentures prior
to maturity and the Issuer Trust is not liquidated and the Junior Subordinated
Debentures are not distributed to holders of the Preferred Securities, the
Preferred Securities will remain outstanding until the Stated Maturity of the
Junior Subordinated Debentures and the distribution of the Liquidation
Distribution to the holders of the Preferred Securities.
If the Corporation elects to dissolve the Issuer Trust and thereby causes the
Junior Subordinated Debentures to be distributed to holders of the Preferred
Securities in exchange therefor upon dissolution of the Issuer Trust, the
Corporation will continue to have the right to shorten the maturity of the
Junior Subordinated Debentures, or to redeem the Junior Subordinated Debentures
in certain circumstances as described under "Certain Terms of Junior
Subordinated Debentures--Conditional Right to Redeem Upon a Tax Event,
Investment Company Event or Capital Treatment Event" herein.
LIQUIDATION VALUE
The amount payable on the Preferred Securities in the event of any
liquidation of the Issuer Trust (the "Liquidation Distribution") is $25 per
Preferred Security plus accumulated and unpaid Distributions, subject to
certain exceptions, which may be in the form of a distribution of such amount
in Junior Subordinated Debentures. See "Description of Preferred Securities--
Liquidation Distribution Upon Dissolution" in the accompanying Prospectus.
REGISTRATION OF PREFERRED SECURITIES
The Preferred Securities will be represented by Global Preferred Securities
(as defined under "Description of Preferred Securities--Global Preferred
Securities" in the accompanying Prospectus) registered in the name of DTC or
its nominee. Beneficial interests in the Preferred Securities will be shown on,
and transfers thereof will be effected only through, records maintained by
Participants (as defined under "Description of Preferred Securities--Global
Preferred Securities" in the accompanying Prospectus) in DTC. Except as
described below and in the accompanying Prospectus, definitive Preferred
Securities in registered certificated form will not be issued in exchange for
the Global Preferred Securities. See "Description of Preferred Securities--
Global Preferred Securities" in the accompanying Prospectus.
A Global Preferred Security will be exchangeable for definitive Preferred
Securities registered in the names of persons other than DTC or its nominee
only if (i) DTC notifies the Corporation and the Property Trustee that it is
unwilling or unable to continue as a depositary for such global security and no
successor depositary is appointed, 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 to act as such depositary, (ii) the Issuer Trust
in its sole discretion determines that such global security will be so
exchangeable, or (iii) a Debenture Event of Default has occurred and is
continuing. Any Global Preferred Security that is exchangeable pursuant to the
preceding sentence will be exchangeable for definitive certificates registered
in such names as DTC directs. It is expected that such instructions will be
based upon directions received by DTC from its Participants with respect to
ownership of beneficial interests in such global security. If Preferred
Securities are issued in definitive form, such Preferred
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<PAGE>
Securities will be in denominations of $25 and integral multiples thereof and
may be transferred or exchanged at the offices described below.
Payments on Preferred Securities represented by a Global Preferred Security
will be made to DTC, as the depositary for the Preferred Securities. If
Preferred Securities are issued in definitive form, the amounts payable in
respect of the Preferred Securities will be payable, the transfer of the
Preferred Securities will be registrable, and Preferred Securities will be
exchangeable for Preferred Securities of other denominations of a like
aggregate Liquidation Amount, at the corporate trust office of the Property
Trustee in Wilmington, Delaware, or at the offices of any paying agent or
transfer agent appointed by the Administrative Trustees, provided that payment
of any Distributions may be made at the option of the Administrative Trustees
by check mailed to the address of the persons entitled thereto or by wire
transfer. For a description of DTC and the terms of the depositary arrangements
relating to payments, transfers, voting rights, redemptions and other notices
and other matters, see "Description of Preferred Securities--Global Preferred
Securities" in the accompanying Prospectus.
CERTAIN TERMS OF JUNIOR SUBORDINATED DEBENTURES
GENERAL
The following summary of certain terms and provisions of the Junior
Subordinated Debentures supplements the description of the terms and provisions
of the Corresponding Junior Subordinated Debentures set forth in the
accompanying Prospectus under the heading "Description of Junior Subordinated
Debentures", to which description reference is hereby made. This summary of
certain terms and provisions of the Junior Subordinated Debentures, which
describes the material provisions thereof, does not purport to be complete and
is subject to, and is qualified in its entirety by reference to, the Junior
Subordinated Indenture to which reference is hereby made. The Junior
Subordinated Indenture is qualified under the Trust Indenture Act. The form of
Junior Subordinated Indenture has been filed as an exhibit to the Registration
Statement of which this Prospectus Supplement and accompanying Prospectus form
a part.
Concurrently with the issuance of the Preferred Securities, the Issuer Trust
will invest the proceeds thereof, together with the consideration paid by the
Corporation for the Common Securities, in the Junior Subordinated Debentures
issued by the Corporation. The Junior Subordinated Debentures will bear
interest, accruing from February , 1997, at the annual rate of % of the
principal amount thereof, payable quarterly in arrears on January , April ,
July and October of each year (each, an "Interest Payment Date"), commencing
April , 1997, to the person in whose name each Junior Subordinated Debenture
is registered at the close of business on the fifteenth day (whether or not a
Business Day) next preceding such Interest Payment Date. It is anticipated
that, until the liquidation, if any, of the Issuer Trust, each Junior
Subordinated Debenture will be held in the name of the Property Trustee in
trust for the benefit of the holders of the Trust Securities. The amount of
interest payable for any period less than a full interest period will be
computed on the basis of a 360-day year of twelve 30-day months and the actual
days elapsed in a partial month in such period. The amount of interest payable
for any full interest period will be computed by dividing the rate per annum by
four. If any date on which interest is payable on the Junior Subordinated
Debentures is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (without
any interest or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such payment will be
made on the immediately preceding Business Day, in each case with the same
force and effect as if made on the date such payment was originally payable.
Accrued interest that is not paid on the applicable Interest Payment Date will
bear additional interest on the amount thereof (to the extent permitted by law)
at the rate per annum of % thereof, compounded quarterly and computed on the
basis of a 360-day year of twelve 30-day months and the actual days elapsed in
a partial month in such period. The amount of additional interest payable for
any full interest period will be computed by dividing the rate per annum by
four. The term "interest" as used herein includes quarterly interest payments,
interest on quarterly interest payments not paid on the applicable Interest
Payment Date and Additional Sums (as defined under "Description of Preferred
Securities--Redemption or Exchange" in the accompanying Prospectus), as
applicable.
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<PAGE>
The Junior Subordinated Debentures will be issued as a series of junior
subordinated deferrable interest debentures under the Junior Subordinated
Indenture. The Junior Subordinated Debentures will mature on February , 2037
(such date, as it may be shortened as hereinafter described, the "Stated
Maturity"). The Stated Maturity may be shortened at any time by the Corporation
to any date not earlier than February , 2002, subject to the Corporation's
commitment to the Federal Reserve not to do so without its prior approval, if
such approval is then required under applicable Federal Reserve capital
guidelines or policies. If the Corporation elects to shorten the Stated
Maturity of the Junior Subordinated Debentures, it will give notice to the
Debenture Trustee, and the Debenture Trustee will give notice of such
shortening to the holders of the Junior Subordinated Debentures not less than
30 and not more than 60 days prior to the effectiveness thereof.
The Junior Subordinated Debentures will be unsecured and will rank junior and
be subordinate in right of payment to all Senior Indebtedness of the
Corporation. See "Description of Junior Subordinated Debentures--Subordination"
in the accompanying Prospectus. Substantially all of the Corporation's existing
indebtedness constitutes Senior Indebtedness. Because the Corporation is a
holding company, the right of the Corporation to participate in any
distribution of assets of any subsidiary, including Bankers, upon such
subsidiary's dissolution, winding-up, liquidation or reorganization or
otherwise (and thus the ability of holders of the Junior Subordinated
Debentures to benefit indirectly from such distribution), is 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. There are various legal limitations on the extent to which certain
of the Corporation's subsidiaries may extend credit, pay dividends or otherwise
supply funds to the Corporation or certain of its other subsidiaries.
Accordingly, the Junior Subordinated Debentures will be effectively
subordinated to all existing and future liabilities of the Corporation's
subsidiaries, and holders of Junior Subordinated Debentures should look only to
the assets of the Corporation for payments on the Junior Subordinated
Debentures. See "Bankers Trust New York Corporation" herein. The Junior
Subordinated Indenture does not limit the incurrence or issuance of other
secured or unsecured debt by the Corporation, including Senior Indebtedness,
whether under the Junior Subordinated Indenture or any existing or other
indenture that the Corporation may enter into in the future or otherwise. See
"Description of Junior Subordinated Debentures--Subordination" in the
accompanying Prospectus.
OPTION TO DEFER INTEREST PAYMENTS
So long as no Debenture Event of Default has occurred and is continuing, the
Corporation has the right at any time or from time to time during the term of
the Junior Subordinated Debentures to defer the payment of interest on the
Junior Subordinated Debentures for a period not exceeding 20 consecutive
quarters with respect to each Extension Period, provided that no Extension
Period may extend beyond the Stated Maturity of the Junior Subordinated
Debentures as in effect at the time of the Corporation's election to defer
interest in this manner. At the end of such Extension Period, the Corporation
must pay all interest then accrued and unpaid (together with interest on such
unpaid interest at the annual rate of %, compounded quarterly and computed on
the basis of a 360-day year of twelve 30-day months and the actual days elapsed
in a partial month in such period, to the extent permitted by applicable law).
The amount of additional interest payable for any full interest period will be
computed by dividing the rate per annum by four. During an Extension Period,
interest will continue to accrue and holders of Junior Subordinated Debentures
(or holders of Preferred Securities while such securities are outstanding) will
be required to accrue interest income for United States federal income tax
purposes. See "Certain Federal Income Tax Consequences--Interest Income and
Original Issue Discount" herein.
During any such Extension Period, the Corporation may not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to the Junior
Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Corporation in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants,
in connection with a dividend reinvestment or stockholder stock purchase plan
or in connection with the issuance of capital stock of the
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Corporation (or securities convertible into or exercisable for such capital
stock) as consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock of
a subsidiary of the Corporation) for any class or series of the Corporation's
capital stock or of any class or series of the Corporation's indebtedness for
any class or series of the Corporation's capital stock, (c) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (d) any declaration of a dividend in connection
with any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase
of rights pursuant thereto, or (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that on
which the dividend is being paid or ranks pari passu with or junior to such
stock). Prior to the termination of any such Extension Period, the Corporation
may further defer the payment of interest, provided that no Extension Period
may exceed 20 consecutive quarters or extend beyond the Stated Maturity of the
Junior Subordinated Debentures as in effect at the time of the Corporation's
election to further defer interest in this manner. Upon the termination of any
such Extension Period and the payment of all amounts then due, the Corporation
may elect to begin a new Extension Period subject to the above conditions. No
interest shall be due and payable during an Extension Period, except at the end
thereof. The Corporation must give the Property Trustee notice of its election
of such Extension Period at least one Business Day prior to the earlier of (i)
the date the Distributions on the Preferred Securities would have been payable
but for the election to begin such Extension Period or (ii) the date the
Property Trustee is required to give notice of the record date to the New York
Stock Exchange, Inc., or any other applicable securities exchange or automated
quotation system on which the Preferred Securities are then listed or quoted or
to holders of Preferred Securities, but in any event not less than one Business
Day prior to such record date. The Property Trustee will give notice of the
Corporation's election to begin a new Extension Period to the holders of the
Preferred Securities. There is no limitation on the number of times that the
Corporation may elect to begin an Extension Period. See "Description of Junior
Subordinated Debentures--Option to Defer Interest Payments" in the accompanying
Prospectus.
ADDITIONAL SUMS
The Corporation has covenanted in the Junior Subordinated Indenture that, if
and for so long as (i) the Issuer Trust is the holder of all Junior
Subordinated Debentures and (ii) the Issuer Trust is required to pay any
additional taxes, duties or other governmental charges as a result of a Tax
Event, the Corporation will pay as additional sums on the Junior Subordinated
Debentures such amounts as may be required so that the Distributions payable by
the Issuer Trust will not be reduced as a result of any such additional taxes,
duties or other governmental charges. See "Description of Preferred
Securities--Redemption or Exchange" in the accompanying Prospectus.
REDEMPTION
The Junior Subordinated Debentures are redeemable prior to maturity at the
option of the Corporation (i) on or after February , 2002, in whole at any
time or in part from time to time, or (ii) in certain circumstances as
described under "Description of Junior Subordinated Debentures--Conditional
Right to Redeem Upon a Tax Event, Investment Company Event or Capital Treatment
Event" herein, in whole (but not in part) at any time within 90 days following
the occurrence and during the continuation of a Tax Event, Investment Company
Event or Capital Treatment Event (or, if the approval of the Federal Reserve is
then required for such redemption, on such later date as promptly as is
reasonably practicable after such approval is obtained), in each case at a
redemption price equal to 100% of the principal amount of the Junior
Subordinated Debentures so redeemed, together with accrued and unpaid interest
thereon to but excluding the date fixed for redemption. See "Description of
Junior Subordinated Debentures--Redemption" in the accompanying Prospectus.
CONDITIONAL RIGHT TO REDEEM UPON A TAX EVENT, INVESTMENT COMPANY EVENT OR
CAPITAL TREATMENT EVENT
The Corporation, as the holder of the Common Securities, has the right to
dissolve the Issuer Trust and, after satisfaction of liabilities to creditors
of the Issuer Trust as provided by applicable law, to cause the Junior
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Subordinated Debentures to be distributed to the holders of the Trust
Securities in liquidation of the Issuer Trust. The Corporation may exercise
this right at any time, including following the occurrence of a Tax Event,
Investment Company Event or Capital Treatment Event. See "Risk Factors--
Exchange of Preferred Securities for Junior Subordinated Debentures" and
"Certain Terms of Preferred Securities--Liquidation of Issuer Trust and
Distribution of Junior Subordinated Debentures" herein and "Description of
Preferred Securities--Liquidation Distribution Upon Dissolution" in the
accompanying Prospectus. Furthermore, the Corporation has the right to shorten
the Stated Maturity of the Junior Subordinated Debentures to a date not earlier
than February , 2002 at any time, including following the occurrence of a Tax
Event, Investment Company Event or Capital Treatment Event. See "Risk Factors--
Shortening of Stated Maturity of Junior Subordinated Debentures" and "Certain
Terms of Junior Subordinated Debentures--General" herein.
In addition, the Corporation has the right to redeem the Junior Subordinated
Debentures in whole (but not in part) at any time within 90 days following the
occurrence and during the continuation of a Tax Event, Investment Company Event
or Capital Treatment Event (or, if the approval of the Federal Reserve is then
required for such redemption, on such later date as promptly as reasonably
practicable after such approval is obtained), but only if:
(i) in the opinion of counsel to the Corporation experienced in such
matters, there would be more than an insubstantial risk that an Adverse Tax
Consequence (as defined below) would continue to exist even if the
Corporation shortened the Stated Maturity of the Junior Subordinated
Debentures to any date not earlier than February , 2002, dissolved
the Issuer Trust and caused the Junior Subordinated Debentures to be
distributed to the holders of the Trust Securities, or both; or
(ii) in the reasonable determination of the Corporation, there would be
more than an insubstantial risk that the Corporation will not be entitled
to treat an amount equal to the Liquidation Amount of the Preferred
Securities as "Tier 1 Capital" (or the then equivalent thereof) for the
purposes of the capital adequacy guidelines of the Federal Reserve, as then
in effect and applicable to the Corporation, after the Corporation has
taken the steps referred to in paragraph (i) above to the extent necessary
to cause the Tax Event, Investment Company Event or Capital Treatment Event
to cease to exist; or
(iii) the Federal Reserve does not approve the shortening of the Stated
Maturity of the Junior Subordinated Debentures to the extent necessary to
cause the Tax Event, Investment Company Event or Capital Treatment Event to
cease to exist following the Corporation's request for such approval.
Any such redemption would be made at a Redemption Price equal to 100% of the
principal amount of the Junior Subordinated Debentures so redeemed, together
with accrued and unpaid interest thereon to but excluding the date fixed for
redemption. Such redemption would be made as described under "--Redemption"
above.
Holders of Preferred Securities should consult their tax advisors regarding
the tax consequences to them of a shortening of the Stated Maturity of the
Junior Subordinated Debentures.
See "Certain Federal Income Tax Consequences--Possible Tax Law Changes"
herein for a discussion of certain legislative proposals that, if adopted,
could give rise to a Tax Event, which may permit the Corporation to redeem the
Junior Subordinated Debentures and cause a redemption of the Preferred
Securities prior to February , 2002.
"Tax Event"means the receipt by the Issuer Trust or the Corporation of an
opinion of counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced proposed change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of this
Prospectus Supplement, there is more than an insubstantial risk that (i) the
Issuer Trust is, or will be within 90 days of the delivery of such opinion,
subject to United States federal income tax with respect to income received or
accrued on the Junior Subordinated
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Debentures, (ii) interest payable by the Corporation on the Junior Subordinated
Debentures is not, or within 90 days of the delivery of such opinion, will not
be, deductible by the Corporation, in whole in part, for United States federal
income tax purposes or (iii) the Issuer Trust is, or will be within 90 days of
the delivery of such opinion, subject to more than a de minimis amount of other
taxes, duties or other governmental charges (each of the circumstances referred
to in clauses (i), (ii) or (iii) of this sentence being referred to herein as
an "Adverse Tax Consequence"). See "Description of Junior Subordinated
Debentures--Conditional Right to Redeem Upon a Tax Event, Investment Company
Event or Capital Treatment Event".
"Investment Company Event" means the receipt by the Issuer Trust or the
Corporation of an opinion of counsel experienced in such matters to the effect
that, as a result of the occurrence of a change in law or regulation or a
change (including any announced proposed change) in interpretation or
application of law or regulation by any legislative body, court, governmental
agency or regulatory authority, there is more than an insubstantial risk that
the Issuer Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940, as amended,
which change or proposed change becomes effective or would become effective, as
the case may be, on or after the date of this Prospectus Supplement.
"Capital Treatment Event" means the reasonable determination by the
Corporation that, as a result of the occurrence of any amendment to, or change
(including any announced proposed change) in, the laws (or any rules or
regulations thereunder) of the United States or any political subdivision
thereof or therein, or as a result of any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws
or regulations, which amendment or change is effective or which pronouncement,
action or decision is announced on or after the date of this Prospectus
Supplement, there is more than an insubstantial risk that the Corporation will
not be entitled to treat an amount equal to the Liquidation Amount of the
Preferred Securities as "Tier 1 Capital" (or the then equivalent thereof) for
purposes of the capital adequacy guidelines of the Federal Reserve, as then in
effect and applicable to the Corporation.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
As described under "Certain Terms of Preferred Securities--Liquidation of
Issuer Trust and Distribution of Junior Subordinated Debentures" herein, under
certain circumstances involving the dissolution of the Issuer Trust, Junior
Subordinated Debentures may be distributed to the holders of the Preferred
Securities and Common Securities in liquidation of the Issuer Trust, after
satisfaction of liabilities to creditors of the Issuer Trust as provided by
applicable law. If distributed to holders of Preferred Securities while the
Preferred Securities are represented by a Global Preferred Security, the Junior
Subordinated Debentures will initially be issued in the form of a Global Junior
Subordinated Debenture (as defined under "Description of Junior Subordinated
Debentures--Global Junior Subordinated Debentures" in the accompanying
Prospectus) and DTC, or any successor depositary for the Preferred Securities,
will act as depositary for the Junior Subordinated Debentures. It is
anticipated that the depositary arrangements for the Junior Subordinated
Debentures would be substantially the same as those for the Preferred
Securities described under "Certain Terms of Preferred Securities--Registration
of Preferred Securities" in this Prospectus Supplement and under "Description
of Junior Subordinated Debentures--Global Junior Subordinated Debentures" in
the accompanying Prospectus. If Junior Subordinated Debentures are distributed
to the holders of Preferred Securities and Common Securities in liquidation of
the Issuer Trust, the Corporation will use all reasonable efforts to list the
Junior Subordinated Debentures on the New York Stock Exchange, Inc. or such
other securities exchange or automated quotation system, if any, on which the
Preferred Securities may then be listed or quoted. There can be no assurance as
to the market price of any Junior Subordinated Debentures that may be
distributed to the holders of Preferred Securities.
REGISTRATION OF JUNIOR SUBORDINATED DEBENTURES
For so long as the Junior Subordinated Debentures are held by the Issuer
Trust, the Junior Subordinated Debentures will be represented by a single
definitive certificate registered in the name of the Property Trustee, for the
benefit of the holders of the Trust Securities. However, if distributed to
holders of Preferred Securities
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while the Preferred Securities are represented by a Global Preferred Security,
the Junior Subordinated Debentures will initially be represented by a Global
Junior Subordinated Debenture registered in the name of DTC or its nominee. In
that event, beneficial interests in the Junior Subordinated Debentures will be
shown on, and transfers thereof will be effected only through, records
maintained by Participants in DTC. Except as described below and in the
accompanying Prospectus, Junior Subordinated Debentures in definitive
certificated form will not be issued in exchange for the Global Junior
Subordinated Debenture. See "Description of Junior Subordinated Debentures--
Global Junior Subordinated Debentures" in the accompanying Prospectus.
A Global Junior Subordinated Debenture will be exchangeable for Junior
Subordinated Debentures registered in the names of persons other than DTC or
its nominee only if (i) DTC notifies the Corporation and the Property Trustee
that it is unwilling or unable to continue as a depositary for such global
security and no successor depositary is appointed, 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 to act as such depositary, (ii) the Corporation
in its sole discretion determines that such global security will be so
exchangeable, or (iii) a Debenture Event of Default has occurred and is
continuing. Any global security that is exchangeable pursuant to the preceding
sentence will be exchangeable for definitive certificates registered in such
names as DTC directs. It is expected that such instructions will be based upon
directions received by DTC from its Participants with respect to ownership of
beneficial interests in such global security. If Junior Subordinated Debentures
are issued in definitive form, such Junior Subordinated Debentures will be in
denominations of $25 and integral multiples thereof and may be transferred or
exchanged at the offices described below.
Payments on Junior Subordinated Debentures represented by a Global Junior
Subordinated Debenture will be made to DTC, as the depositary for the Junior
Subordinated Debentures. Payments on Junior Subordinated Debentures issued in
definitive form will be payable, the transfer of such Junior Subordinated
Debentures will be registrable, and such Junior Subordinated Debentures will be
exchangeable for Junior Subordinated Debentures of other denominations of a
like aggregate principal amount, at the corporate trust office of the Debenture
Trustee in Wilmington, Delaware, or at the offices of any paying agent or
transfer agent appointed by the Corporation, provided that payment of interest
may be made at the option of the Corporation by check mailed to the address of
the persons entitled thereto or by wire transfer. For a description of DTC and
the terms of the depositary arrangements relating to payments, transfers,
voting rights, redemptions and other notices and other matters, see
"Description of Junior Subordinated Debentures--Global Junior Subordinated
Debentures" in the accompanying Prospectus.
CERTAIN TERMS OF GUARANTEE
The Guarantee guarantees to the holders of the Preferred Securities the
following payments, to the extent not paid by or on behalf of the Issuer Trust:
(i) any accumulated and unpaid Distributions required to be paid on the
Preferred Securities, to the extent that the Issuer Trust has funds on hand
available therefor at such time, (ii) the Redemption Price with respect to any
Preferred Securities called for redemption, to the extent that the Issuer Trust
has funds on hand available therefor at such time, and (iii) upon a voluntary
or involuntary dissolution, winding-up or liquidation of the Issuer Trust
(unless the Junior Subordinated Debentures are distributed to holders of the
Preferred Securities), the lesser of (a) the Liquidation Distribution, to the
extent that the Issuer Trust has funds on hand available therefor at such time,
and (b) the amount of assets of the Issuer Trust remaining available for
distribution to holders of the Preferred Securities on liquidation of the
Issuer Trust after satisfaction of liabilities to creditors of the Issuer Trust
as provided by applicable law. The Guarantee will be qualified as an indenture
under the Trust Indenture Act. Wilmington Trust Company, as Guarantee Trustee,
will act as trustee for the purposes of compliance with the Trust Indenture Act
and will hold the Guarantee for the benefit of the holders of the Preferred
Securities. Wilmington Trust Company will also act as Debenture Trustee for the
Junior Subordinated Debentures and as Property Trustee and Delaware Trustee
under the Declaration of Trust.
The holders of not less than a majority in aggregate Liquidation Amount of
the outstanding Preferred Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy
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available to the Guarantee Trustee in respect to the Guarantee or to direct the
exercise of any trust or power conferred upon the Guarantee Trustee under the
Guarantee. Any registered holder of the Preferred Securities may institute a
legal proceeding directly against the Corporation to enforce its rights under
the Guarantee without first instituting a legal proceeding against the Issuer
Trust, the Guarantee Trustee or any other person or entity. If the Corporation
were to default on its obligation to pay amounts payable under the Junior
Subordinated Debentures, the Issuer Trust would lack funds for the payment of
Distributions or amounts payable on redemption of the Preferred Securities or
otherwise, and, in such event, holders of the Preferred Securities would not be
able to rely upon the Guarantee for payment of such amounts. Instead, if any
event of default under the Junior Subordinated Indenture has occurred and is
continuing and such event is attributable to the failure of the Corporation to
pay any amounts in respect of the Junior Subordinated Debentures on the
applicable payment date, then a holder of Preferred Securities may institute a
Direct Action against the Corporation pursuant to the terms of the Junior
Subordinated Indenture for enforcement of payment to such holder of the
principal of or interest or premium, if any, on such Junior Subordinated
Debentures having a principal amount equal to the aggregate Liquidation Amount
of the Preferred Securities of such holder. In connection with such Direct
Action, the Corporation will have a right of set-off under the Junior
Subordinated Indenture to the extent of any payment made by the Corporation to
such holder of Preferred Securities in the Direct Action. Except as described
herein, holders of Preferred Securities will not be able to exercise directly
any other remedy available to the holders of the Junior Subordinated Debentures
or assert directly any other rights in respect of the Junior Subordinated
Debentures. See "Description of Guarantees" in the accompanying Prospectus. The
Declaration of Trust provides that each holder of Preferred Securities by
acceptance thereof agrees to the provisions of the Guarantee, the Expense
Agreement and the Junior Subordinated Indenture.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the material United States federal income tax
consequences of the purchase, ownership and disposition of Preferred
Securities. This summary only addresses the tax consequences to a person that
acquires Preferred Securities on their original issue at their original
offering price and does not address all tax consequences that may be applicable
to a beneficial owner of Preferred Securities, nor does it address the tax
consequences to (i) persons that may be subject to special treatment under
United States federal income tax law, such as banks, insurance companies,
thrift institutions, regulated investment companies, real estate investment
trusts, tax-exempt organizations and dealers in securities or currencies, (ii)
persons that will hold Preferred Securities as part of a position in a
"straddle" or as part of a "hedging", "conversion" or other integrated
investment transaction for United States federal income tax purposes, (iii)
persons whose functional currency is not the United States dollar or (iv)
persons that do not hold Preferred Securities as capital assets.
The statements of law or legal conclusion set forth in this summary
constitute the opinion of Sullivan & Cromwell, counsel to the Corporation and
the Issuer Trust. This summary is based upon the Internal Revenue Code of 1986,
as amended (the "Code"), Treasury regulations, Internal Revenue Service ("IRS")
rulings and pronouncements and judicial decisions now in effect, all of which
are subject to change at any time. Such changes may be applied retroactively in
a manner that could cause the tax consequences to vary substantially from the
consequences described below, possibly adversely affecting a beneficial owner
of Preferred Securities. In particular, legislation has been proposed that
could adversely affect the Corporation's ability to deduct interest on the
Junior Subordinated Debentures, which may in turn permit the Corporation to
cause a redemption of the Preferred Securities prior to February , 2002. See
"--Possible Tax Law Changes". The authorities on which this summary is based
are subject to various interpretations, and it is therefore possible that the
United States federal income tax treatment of the purchase, ownership and
disposition of Preferred Securities may differ from the treatment described
below.
PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT WITH THEIR OWN TAX ADVISORS IN
LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE UNITED STATES FEDERAL
INCOME TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND
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DISPOSITION OF PREFERRED SECURITIES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL
OR FOREIGN TAX LAWS.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES AND THE ISSUER TRUST
Under current law and assuming compliance with the terms of the Declaration
of Trust, the Issuer Trust will not be taxable as a corporation for United
States federal income tax purposes. As a result, each beneficial owner of
Preferred Securities that is (i) an individual citizen or resident of the
United States, (ii) a corporation or partnership organized in or under the laws
of the United States or any state thereof or the District of Columbia or (iii)
an estate or trust the income of which is subject to United States federal
income tax regardless of source (a "Beneficial Owner") will be required to
include in its gross income its pro rata share of the interest income,
including original issue discount ("OID"), paid or accrued with respect to the
Junior Subordinated Debentures whether or not cash is actually distributed to
the Beneficial Owners. See "--Interest Income and Original Issue Discount". The
Junior Subordinated Debentures will be classified as indebtedness of the
Corporation for United States federal income tax purposes.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under recently issued Treasury regulations applicable to debt instruments
issued on or after August 13, 1996 (the "Regulations"), a "remote" contingency
that stated interest will not be timely paid will be ignored in determining
whether a debt instrument is issued with OID. The Corporation believes that the
likelihood of its exercising its option to defer payments of interest is
remote. Based on the foregoing, the Corporation believes that the Junior
Subordinated Debentures will not be considered to be issued with OID at the
time of their original issuance and, accordingly, a Beneficial Owner should
include in gross income such Beneficial Owner's allocable share of interest on
the Junior Subordinated Debentures. The following discussion assumes that
unless and until the Corporation exercises its option to defer interest on the
Junior Subordinated Debentures, the Junior Subordinated Debentures will not be
treated as issued with OID.
Under the Regulations, if the Corporation exercised its option to defer any
payment of interest, the Junior Subordinated Debentures would at that time be
treated as issued with OID, and all stated interest on the Junior Subordinated
Debentures would thereafter be treated as OID as long as the Junior
Subordinated Debentures remained outstanding. In such event, all of a
Beneficial Owner's taxable interest income with respect to the Junior
Subordinated Debentures would be accounted for as OID on an economic accrual
basis regardless of such Beneficial Owner's method of tax accounting, and
actual distributions of stated interest would not be reported as taxable
income. Consequently, a Beneficial Owner would be required to include in gross
income OID even though the Corporation would not make any actual cash payments
during an Extension Period.
The Regulations have not been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation herein.
Because income on the Preferred Securities will constitute interest or OID,
corporate Beneficial Owners will not be entitled to a dividends-received
deduction with respect to any income recognized with respect to the Preferred
Securities.
Subsequent use of the term "interest" in this summary include income in the
form of OID.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES TO BENEFICIAL OWNERS
Under current law, a distribution by the Issuer Trust of the Junior
Subordinated Debentures as described under the caption "Certain Terms of
Preferred Securities--Liquidation of Issuer Trust and Distribution of Junior
Subordinated Debentures" will be non-taxable and will result in the Beneficial
Owner receiving directly his or her pro rata share of the Junior Subordinated
Debentures previously held indirectly through the Issuer Trust, with a holding
period and aggregate tax basis equal to the holding period and aggregate tax
basis such Beneficial Owner had in its Preferred Securities before such
distribution. If, however, the liquidation of the Issuer Trust
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were to occur because the Issuer Trust is subject to United States federal
income tax with respect to income accrued or received on the Junior
Subordinated Debentures, the distribution of Junior Subordinated Debentures to
Beneficial Owners by the Issuer Trust would be a taxable event to the Issuer
Trust and each Beneficial Owner, and each Beneficial Owner would recognize gain
or loss as if the Beneficial Owner had exchanged its Preferred Securities for
the Junior Subordinated Debentures it received upon the liquidation of the
Issuer Trust. A Beneficial Owner will include interest in respect of Junior
Subordinated Debentures received from the Issuer Trust in the manner described
above under "--Interest Income and Original Issue Discount".
SALES OR REDEMPTIONS OF PREFERRED SECURITIES
A Beneficial Owner that sells (including a redemption for cash) Preferred
Securities will recognize gain or loss equal to the difference between its
adjusted tax basis in the Preferred Securities and the amount realized on the
sale of such Preferred Securities. Assuming that the Corporation does not
exercise its option to defer payment of interest on the Junior Subordinated
Debentures, a Beneficial Owner's adjusted tax basis in the Preferred Securities
generally will be its initial purchase price. If the Junior Subordinated
Debentures are deemed to be issued with OID as a result of the Corporation's
deferral of any interest payment, a Beneficial Owner's adjusted tax basis in
the Preferred Securities generally will be its initial purchase price,
increased by OID previously includible in such Beneficial Owner's gross income
to the date of disposition and decreased by Distributions or other payments
received on the Preferred Securities since and including the date of the first
Extension Period. Such gain or loss generally will be a capital gain or loss
(except to the extent any amount realized is treated as a payment of accrued
interest with respect to such Beneficial Owner's pro rata share of the Junior
Subordinated Debentures required to be included in income) and generally will
be a long-term capital gain or loss if the Preferred Securities have been held
for more than one year.
Should the Corporation exercise its option to defer any payment of interest
on the Junior Subordinated Debentures, the Preferred Securities may trade at a
price that does not accurately reflect the value of accrued but unpaid interest
with respect to the underlying Junior Subordinated Debentures. In the event of
such a deferral, a Beneficial Owner who disposes of its Preferred Securities
between record dates for payments of distributions thereon will be required to
include in income as ordinary income accrued but unpaid interest on the Junior
Subordinated Debentures to the date of disposition as OID, but may not receive
the cash related thereto. However, such Beneficial Owner will add such amount
to its adjusted tax basis in the Preferred Securities. To the extent the
selling price is less than the Beneficial Owner's adjusted tax basis, such
Beneficial Owner will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of interest income paid and OID accrued on the Preferred
Securities held of record by Beneficial Owners (other than corporations and
other exempt Beneficial Owners) will be reported to the IRS. "Backup"
withholding at a rate of 31% will apply to payments of interest to non-exempt
Beneficial Owners unless the Beneficial Owner furnishes its taxpayer
identification number in the manner prescribed in applicable Treasury
regulations, certifies that such number is correct, certifies as to no loss of
exemption from backup withholding and meets certain other conditions.
Payment of the proceeds from the disposition of Preferred Securities to or
through the United States office of a broker is subject to information
reporting and backup withholding unless the Beneficial Owner establishes an
exemption from information reporting and backup withholding.
Any amounts withheld from a Beneficial Owner under the backup withholding
rules will be allowed as a refund or a credit against such Beneficial Owner's
United States federal income tax liability, provided the required information
is furnished to the IRS.
It is anticipated that income on the Preferred Securities will be reported to
Beneficial Owners on Form 1099 and mailed to Beneficial Owners by January 31
following each calendar year.
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POSSIBLE TAX LAW CHANGES
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the
revenue portion of President Clinton's budget proposal, was released. If it had
been enacted, the Bill would have generally denied interest deductions for
interest on an instrument issued by a corporation that has a maximum term of
more than 20 years and that is not shown as indebtedness on the separate
balance sheet of the issuer or, where the instrument is issued to a related
party (other than a corporation), where the holder or some other related party
issues a related instrument that is not shown as indebtedness on the issuer's
consolidated balance sheet. For purposes of determining the weighted average
maturity or the term of an instrument, any right to extend would be treated as
exercised. The above-described provisions of the Bill were proposed to be
effective generally for instruments issued on or after December 7, 1995. If
similar provisions were to apply to the Junior Subordinated Debentures, the
Corporation would be unable to deduct interest on the Junior Subordinated
Debentures. However, on March 29, 1996, the Chairmen of the Senate Finance and
House Ways and Means Committees issued a joint statement to the effect that it
was their intention that the effective date of the President's legislative
proposals, if adopted, will be no earlier than the date of appropriate
Congressional action. Under current law, the Corporation will be able to deduct
interest on the Junior Subordinated Debentures. There can be no assurance,
however, that current or future legislative proposals or final legislation will
not affect the ability of the Corporation to deduct interest on the Junior
Subordinated Debentures. Such a change could give rise to a Tax Event, which
would permit the Corporation to cause a redemption of the Preferred Securities
prior to February , 2002, as described more fully under "Certain Terms of
Preferred Securities--Redemption" and "Certain Terms of Junior Subordinated
Debentures--Redemption" and "--Conditional Right to Redeem Upon a Tax Event,
Investment Company Event or Capital Treatment Event" herein and under
"Description of Preferred Securities--Redemption or Exchange" in the
accompanying Prospectus.
It is unclear whether an exercise by the Corporation of its right to shorten
the Stated Maturity of the Junior Subordinated Debentures following a Tax Event
would be a taxable event to Beneficial owners.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is, as to the United
States, a foreign corporation, a non-resident alien individual, a foreign
partnership, or a non-resident fiduciary of a foreign estate or trust.
Under present United States federal income tax law: (i) payments by the
Issuer Trust or any of its paying agents to any holder of a Preferred Security
who or which is a United States Alien Holder will not be subject to United
States federal withholding tax; provided, that, (a) the beneficial owner of the
Preferred Security does not actually or constructively own 10% or more of the
total combined voting power of all classes of stock of the Corporation entitled
to vote, (b) the beneficial owner of the Preferred Security is not a controlled
foreign corporation that is related to the Corporation through stock ownership,
and (c) either (A) the beneficial owner of the Preferred Security certifies to
the Issuer Trust or its agent, under penalties of perjury, that it is not a
United States holder and provides its name and address or (B) a securities
clearing organization, bank or other financial institution that holds
customers' securities in the ordinary course of its trade or business (a
"Financial Institution"), and holds the Preferred Security in such capacity,
certifies to the Issuer Trust or its agent, under penalties of perjury, that
such statement has been received from the beneficial owner by it or by a
Financial Institution holding such security for the beneficial owner and
furnishes the Issuer Trust or its agent with a copy thereof; and (ii) a United
States Alien Holder of a Preferred Security will not be subject to United
States federal withholding tax on any gain realized upon the sale or other
disposition of a Preferred Security.
Recently proposed IRS Treasury regulations (the "Proposed Regulations") would
provide alternative methods for satisfying the certification requirement
described in clause (i)(c) above. The Proposed Regulations also would require,
in the case of Preferred Securities held by a foreign partnership, that (x) the
certification described in clause (i)(c) above be provided by the partners
rather than by the foreign partnership and (y) the partnership provide certain
information, including a United States taxpayer identification number. A look-
through
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rule would apply in the case of tiered partnerships. The Proposed Regulations
are proposed to be effective for payments made after December 31, 1997. There
can be no assurance that the Proposed Regulations will be adopted or as to the
provisions that they will include if and when adopted in temporary or final
form.
Payments made on, and proceeds from the sale of, the Preferred Securities may
be subject to a "backup" withholding tax of 31% unless the Beneficial Owner
complies with certain certification requirements. Any withheld amounts will be
allowed as a credit against the Beneficial Owner's United States federal income
tax, provided the required information is provided to the IRS on a timely
basis.
CERTAIN ERISA CONSIDERATIONS
A fiduciary of a pension, profit-sharing or other employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), should consider the fiduciary standards of ERISA in the context of
the plan's particular circumstances before authorizing an investment in the
Preferred Securities. Among other factors, the fiduciary should consider
whether the investment would satisfy the prudence and diversification
requirements of ERISA and would be in accordance with the documents governing
the plan. Section 406 of ERISA and Section 4975 of the Internal Revenue Code of
1986, as amended (the "Code"), prohibit an employee benefit plan from engaging
in certain transactions involving "plan assets" with persons who are "parties
in interest" under ERISA or "disqualified persons" under the Code with respect
to the plan. Therefore, a fiduciary of an employee benefit plan should also
consider whether an investment in the Preferred Securities might constitute or
give rise to a prohibited transaction under ERISA and the Code.
The U.S. Department of Labor (the "DOL") has issued a final regulation with
regard to whether the underlying assets of an entity in which employee benefit
plans acquire equity interests would be deemed to be plan assets. The
regulation provides that the underlying assets of an entity will not be
considered to be plan assets if the equity interests acquired by employee
benefit plans are "publicly-offered securities"--that is, they are (1) widely
held (i.e., owned by more than 100 investors independent of the Corporation and
of each other), (2) freely transferable and (3) sold as part of an offering
pursuant to an effective registration statement under the Securities Act and
then timely registered under Section 12(b) or 12(g) of the Exchange Act. It is
expected that the Preferred Securities will meet the criteria of "publicly-
offered securities" above. The Underwriters expect that the Preferred
Securities will be held by at least 100 independent investors at the conclusion
of the offering; there are no restrictions imposed on the transfer of the
Preferred Securities and the Preferred Securities will be sold as part of an
offering pursuant to an effective registration statement under the Securities
Act, and then will be timely registered under the Exchange Act.
The Corporation and certain of its subsidiaries (such as Bankers) could be a
party in interest or disqualified person with respect to an employee benefit
plan. Special caution should be exercised before purchasing Preferred
Securities in such event, including the availability of a class exemption
issued by the DOL which could apply to exempt the purchase of the Preferred
Securities from the prohibited transaction provisions of ERISA and the Code--
e.g., Prohibited Transaction Exemption 84-14, for certain transactions
determined by independent qualified professional asset managers, Prohibited
Transaction Exemption 90-1, for certain transactions involving insurance
company pooled separate accounts, Prohibited Transaction Exemption 91-38, for
certain transactions involving bank collective investment funds, Prohibited
Transaction Exemption 95-60 for certain transactions involving insurance
company general accounts, and Prohibited Transaction Exemption 96-23, for
certain transactions determined by in-house asset managers.
Due to the complexity of these rules and the penalties imposed upon persons
involved in prohibited transactions, it is important that an employee benefit
plan considering the purchase of Preferred Securities consult with its counsel
regarding the consequences under ERISA of the acquisition of Preferred
Securities. Employee benefit plans which are governmental plans (as defined in
Section 3(32) of ERISA) and certain church plans (as defined in Section 3(33)
of ERISA) generally are not subject to ERISA requirements.
S-30
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Corporation and the Issuer Trust have agreed that the Issuer Trust will
sell to the underwriters listed below (the "Underwriters"), and the
Underwriters have severally agreed to purchase from the Issuer Trust, the
respective number of Preferred Securities set forth opposite their names below.
In the Underwriting Agreement, the several Underwriters have agreed, subject to
the terms and conditions set forth therein, to purchase all the Preferred
Securities offered hereby if any of the Preferred Securities are purchased. In
the event of default by an Underwriter, the Underwriting Agreement provides
that, in certain circumstances, the purchase commitments of the nondefaulting
Underwriters may be increased or the Underwriting Agreement may be terminated.
<TABLE>
<CAPTION>
NUMBER OF
PREFERRED
UNDERWRITER SECURITIES
----------- ----------
<S> <C>
Smith Barney Inc. ................................................
Merrill Lynch, Pierce, Fenner & Smith
Incorporated......................................................
PaineWebber Incorporated..........................................
Prudential Securities Incorporated................................
Dean Witter Reynolds Inc..........................................
AG Edwards & Sons, Inc. ..........................................
Goldman, Sachs & Co. .............................................
---------
Total........................................................... 8,000,000
=========
</TABLE>
The Underwriters propose initially to offer the Preferred Securities to the
public at the public offering price set forth on the cover page of this
Prospectus Supplement and to certain dealers at such price less a concession
not in excess of $ per Preferred Security. The Underwriters may allow, and
such dealers may reallow, a discount not in excess of $. per Preferred
Security to certain other dealers. After the initial public offering, the
public offering price, concession and discount may be changed.
In view of the fact that the proceeds from the sale of the Preferred
Securities will be used to purchase the Junior Subordinated Debentures issued
by the Corporation, the Underwriting Agreement provides that the Corporation
will pay as Underwriters' compensation for the Underwriters' arranging the
investment therein of such proceeds an amount of $ per Preferred Security
for the accounts of the several Underwriters, except that the compensation to
be paid by the Corporation to the Underwriters with respect to any Preferred
Securities sold to certain institutions will be $ .
Prior to this offering, there has been no public market for the Preferred
Securities. Application will be made to list the Preferred Securities on the
New York Stock Exchange, Inc. Trading of the Preferred Securities on the New
York Stock Exchange, Inc. is expected to commence within a 30-day period after
the initial delivery of the Preferred Securities. The Underwriters have advised
the Corporation that they intend to make a market in the Preferred Securities
prior to commencement of trading on the New York Stock Exchange, Inc., but they
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 Preferred Securities.
In order to meet one of the requirements for listing the Preferred Securities
on the New York Stock Exchange, Inc., the Underwriters will undertake to sell
lots of 100 or more Preferred Securities to a minimum of 400 beneficial
holders.
The Corporation and the Issuer Trust have agreed to indemnify the several
Underwriters against, or contribute to payments that the Underwriters may be
required to make in respect of, certain liabilities, including liabilities
under the Securities Act.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services to the Corporation and its affiliates, for which such Underwriters or
their affiliates have received or will receive customary fees and commissions.
S-31
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED JANUARY 31, 1997
$580,000,000
LOGO BANKERS TRUST NEW YORK CORPORATION
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
BT PREFERRED CAPITAL TRUST I
BT PREFERRED CAPITAL TRUST II
BT PREFERRED CAPITAL TRUST III
BT PREFERRED CAPITAL TRUST IV
PREFERRED SECURITIES FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN,
BY
BANKERS TRUST NEW YORK CORPORATION
Bankers Trust New York Corporation, a New York corporation (the
"Corporation"), may from time to time offer in one or more series or issuances
its junior subordinated deferrable interest debentures (the "Junior
Subordinated Debentures"). The Junior Subordinated Debentures will be unsecured
and subordinate and junior in right of payment to all Senior Indebtedness (as
defined in "Description of Junior Subordinated Debentures--Subordination") of
the Corporation. If so provided in the accompanying Prospectus Supplement, the
Corporation will have the right to defer payments of interest on any series of
Junior Subordinated Debentures by extending the interest payment period thereon
at any time or from time to time for up to such number of consecutive interest
payment periods (which shall not extend beyond the Stated Maturity (as defined
herein) of the Junior Subordinated Debentures as in effect at the time of the
Corporation's election to defer interest in this manner) with respect to each
deferral period as may be specified in such Prospectus Supplement (each, an
"Extension Period"). In such circumstances, however, the Corporation would not
be permitted, subject to certain exceptions set forth herein, to declare or pay
any dividends, distributions or other payments with respect to, or repay,
repurchase, redeem or otherwise acquire, the Corporation's capital stock or
debt securities that rank pari passu in all respects with or junior to such
series of Junior Subordinated Debentures. See "Description of Junior
Subordinated Debentures--Option to Defer Interest Payments" and "--Restrictions
on Certain Payments".
BT Preferred Capital Trust I, BT Preferred Capital Trust II, BT Preferred
Capital Trust III and BT Preferred Capital Trust IV, each a statutory business
trust created under the laws of the State of Delaware (each, an "Issuer
Trust"), may severally offer, from time to time, preferred securities (the
"Preferred Securities") representing preferred undivided beneficial interests
in the assets of such Issuer Trust. The Corporation will initially be the
holder of all the beneficial interests represented by common securities of such
Issuer Trust (the "Common
(continued on next page)
-----------
THESE SECURITIES 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. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
The date of this Prospectus is , 1997.
<PAGE>
(cover page continued)
Securities" and, together with the Preferred Securities, the "Trust
Securities"). Holders of the Preferred Securities will be entitled to receive
preferential cumulative cash distributions ("Distributions") accumulating from
the date of original issuance and payable periodically as provided in the
applicable Prospectus Supplement. Concurrently with the issuance by an Issuer
Trust of its Preferred Securities, such Issuer Trust will invest the proceeds
thereof and of any contributions received in respect of the Common Securities
in a corresponding series of the Corporation's Junior Subordinated Debentures
(the "Corresponding Junior Subordinated Debentures") with terms corresponding
to the terms of that Issuer Trust's Preferred Securities (the "Related
Preferred Securities"). The Corresponding Junior Subordinated Debentures will
be the sole assets of each Issuer Trust, and payments under the Corresponding
Junior Subordinated Debentures will be the only revenues of such Issuer Trust.
If so provided in the applicable Prospectus Supplement, the Corporation may
redeem the Corresponding Junior Subordinated Debentures (and cause the
redemption of the Related Trust Securities) or may dissolve each Issuer Trust
and cause the Corresponding Junior Subordinated Debentures to be distributed
to the holders of the Related Preferred Securities in liquidation of their
interests in such Issuer Trust. The Corporation has committed to the Board of
Governors of the Federal Reserve System (the "Federal Reserve") not to
exercise these rights without having received the prior approval of the
Federal Reserve to do so, if then required under applicable Federal Reserve
capital guidelines or policies. See "Description of Preferred Securities--
Liquidation Distribution Upon Dissolution".
If the Corporation exercises the right to defer payments of interest on any
series of Corresponding Junior Subordinated Debentures as described above,
Distributions on the Related Preferred Securities will also be deferred.
During an Extension Period, interest on the Corresponding Junior Subordinated
Debentures will continue to accrue (and the amount of Distributions to which
holders of the Related Preferred Securities are entitled will accumulate) at
the rate per annum set forth in the applicable Prospectus Supplement. See
"Description of Preferred Securities--Distributions".
Taken together, the Corporation's obligations under each series of Junior
Subordinated Debentures, the Junior Subordinated Indenture, the related
Declaration of Trust, the related Expense Agreement and the related Guarantee
(each, as defined herein), in the aggregate, provide a full, irrevocable and
unconditional guarantee of payments of distributions and other amounts due on
the Related Preferred Securities. See "Relationship Among the Preferred
Securities, the Corresponding Junior Subordinated Debentures, the Guarantees
and the Expense Agreements--Full and Unconditional Guarantee". The payment of
Distributions with respect to the Preferred Securities of each Issuer Trust
and payments on liquidation or redemption with respect to such Preferred
Securities, in each case out of funds held by such Issuer Trust, are each
irrevocably guaranteed by the Corporation to the extent described herein
(each, a "Guarantee"). See "Description of Guarantees". The obligations of the
Corporation under each Guarantee will be subordinate and junior in right of
payment to all Senior Indebtedness of the Corporation.
The Junior Subordinated Debentures and Preferred Securities may be offered
in amounts, at prices and on terms to be determined at the time of offering.
Certain specific terms of the Junior Subordinated Debentures or Preferred
Securities in respect of which this Prospectus is being delivered will be
described in an applicable Prospectus Supplement, including without limitation
and where applicable, (a) in the case of Junior Subordinated Debentures, the
specific designation, aggregate principal amount, denominations, Stated
Maturity (including any provisions for the shortening or extension thereof),
interest payment dates, interest rate (which may be fixed or variable) or
method of calculating interest, if any, applicable Extension Period or
interest deferral terms, if any, place or places where principal, premium, if
any, and interest, if any, will be payable, any terms of redemption, any
sinking fund provisions, terms for any conversion or exchange into other
securities, initial offering or purchase price, methods of distribution and
any other special terms, and (b) in the case of Preferred Securities, the
identity of the Issuer Trust, specific title, aggregate amount, stated
liquidation amount, number of securities, Distribution rate or method of
calculating such rate, Distribution payment dates, applicable Distribution
deferral terms, if any, place or places where Distributions will be payable,
any terms of redemption, exchange, initial offering or purchase price, methods
of distribution and any other special terms.
2
<PAGE>
(cover page continued)
The Prospectus Supplement also will contain information, as applicable,
about certain United States federal income tax consequences relating to the
Junior Subordinated Debentures or Preferred Securities.
The Junior Subordinated Debentures and Preferred Securities may be sold to
or through underwriters, through dealers, remarketing firms or agents or
directly to purchasers. See "Plan of Distribution". The names of any
underwriters, dealers, remarketing firms or agents involved in the sale of
Junior Subordinated Debentures or Preferred Securities in respect of which
this Prospectus is being delivered and any applicable fee, commission or
discount arrangements with them will be set forth in a Prospectus Supplement.
The Prospectus Supplement will state whether the Junior Subordinated
Debentures or Preferred Securities will be listed on any national securities
exchange or automated quotation system. If the Junior Subordinated Debentures
or Preferred Securities are not listed on any national securities exchange or
automated quotation system, there can be no assurance that there will be a
secondary market for the Junior Subordinated Debentures or Preferred
Securities.
This Prospectus may not be used to consummate sales of Junior Subordinated
Debentures or Preferred Securities unless accompanied by a Prospectus
Supplement.
Following the initial distribution of any Preferred Securities, BT
Securities Corporation ("BT Securities") and other affiliates of the
Corporation may offer and sell such securities in the course of their business
as broker- dealers. BT Securities and such other affiliates may act as
principal or agent in such transactions. This Prospectus and the applicable
Prospectus Supplement may be used by BT Securities and such other affiliates
in connection with such transactions. Such sales, if any, will be made at
varying prices related to prevailing market prices at the time of sale.
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 THE ADEQUACY OF THIS PROSPECTUS.
3
<PAGE>
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.,
Room 1024, 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 (Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511). Copies of such material can also be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. The Commission also maintains a
site on the World Wide Web, the address of which is http://www.sec.gov, that
contains reports, proxy statements and other information regarding issuers,
such as the Corporation, that file electronically with the Commission. In
addition, such materials can be inspected at the office of the New York Stock
Exchange, Inc. and the office of the American Stock Exchange, Inc., on which
certain securities of the Corporation are listed. This Prospectus does not
contain all the information set forth in the registration statement of which
this Prospectus forms a part (the "Registration Statement"), which the
Corporation and the Issuer Trusts have filed with the Commission under the
Securities Act of 1933, as amended (the "Securities Act"), and to which
reference is hereby made, certain parts of which are omitted in accordance
with the rules and regulations of the Commission.
No separate financial statements of any Issuer Trust have been included or
incorporated by reference herein. The Corporation and the Issuer Trusts do not
consider that such financial statements would be material to holders of the
Preferred Securities because each Issuer Trust is a newly formed special
purpose entity, has no operating history or independent operations and is not
engaged in and does not propose to engage in any activity other than holding
as trust assets the Corresponding Junior Subordinated Debentures and issuing
the Trust Securities and engaging in only those other activities necessary or
incidental thereto. Furthermore, taken together, the Corporation's obligations
under each series of Corresponding Junior Subordinated Debentures, the Junior
Subordinated Indenture, the related Declaration of Trust, the related Expense
Agreement and the related Guarantee, in the aggregate, provide a full,
irrevocable and unconditional guarantee of payments of Distributions and other
amounts due on the Preferred Securities of an Issuer Trust. See "The Issuer
Trusts", "Description of Preferred Securities", "Description of Junior
Subordinated Debentures", "Description of Guarantees" and "Relationship Among
the Preferred Securities, the Corresponding Junior Subordinated Debentures,
the Guarantees and the Expense Agreements". In addition, the Corporation does
not expect that any of the Issuer Trusts will be filing reports under the
Exchange Act with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Corporation and the Issuer Trusts hereby incorporate 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, 1995, filed pursuant to Section 13 of the
Exchange Act;
(b) The Corporation's Quarterly Reports on Form 10-Q (file number 1-5920)
for the quarters ended March 31, June 30 and September 30, 1996, filed
pursuant to Section 13 of the Exchange Act; and
(c) The Corporation's Current Reports on Form 8-K (file number 1-5920)
dated March 19, April 15, April 25, May 3, May 22, June 18, July 18, July
22, July 26, August 1, October 3, October 17, October 22, November 19 and
December 9, 1996 and January 23, 1997, filed pursuant to Section 13 of the
Exchange Act.
4
<PAGE>
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 any offering of the securities offered hereby
shall be deemed to be incorporated by reference into this Prospectus and to be
a part hereof from the date of filing of such documents. Any statement
contained 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, 130 Liberty Street, New York, New York 10006. Telephone requests
may be directed to (212) 250-2500.
----------------
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 APPLICABLE PROSPECTUS SUPPLEMENT, IN CONNECTION WITH THE
OFFERING CONTAINED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION AND
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
CORPORATION OR THE ISSUER TRUSTS. 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 SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE THEREOF
OR, IN THE CASE OF INFORMATION INCORPORATED HEREIN BY REFERENCE, THE DATE OF
FILING WITH THE COMMISSION.
5
<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
December 31, 1996, the Corporation had consolidated total assets of $120.2
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 Investment Banking, Risk
Management Services, Trading & Sales, Investment Management, Client Processing
Services, Australia/New Zealand, Asia, Latin America and Corporate. Among the
institutional market segments served are corporations, banks, other financial
institutions, governments and agencies, retirement plans, not-for-profit
organizations, wealthy individuals, foundations and private companies. 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 certain of the Corporation's 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 short-term borrowings and accounts payable.
The Corporation's principal executive offices are located at 130 Liberty
Street, New York, New York 10006 and its telephone number is (212) 250-2500.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1992 1993 1994 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Excluding Interest on Deposits.................... 1.44 1.71 1.28 1.08 1.20
Including Interest on Deposits.................... 1.28 1.48 1.21 1.06 1.15
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income 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.
CONSOLIDATED RATIOS OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK
DIVIDEND REQUIREMENTS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1992 1993 1994 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Excluding Interest on Deposits.................... 1.41 1.69 1.27 1.05 1.18
Including Interest on Deposits.................... 1.26 1.47 1.20 1.04 1.14
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income 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. Fixed charges are then combined with preferred stock
dividend requirements, adjusted to a pretax basis, on the outstanding
preferred stock.
6
<PAGE>
THE ISSUER TRUSTS
Each Issuer Trust is a statutory business trust created under Delaware law
pursuant to the filing of a certificate of trust with the Delaware Secretary
of State which will be governed by a declaration of trust executed by the
Corporation, as Depositor of the Issuer Trust, and the Delaware Trustee (as
defined herein) of such Issuer Trust. Each declaration of trust will be
amended and restated in its entirety (each, as so amended and restated, a
"Declaration of Trust") substantially in the form filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. Each Declaration
of Trust will be qualified as an indenture under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"). Each Issuer Trust exists for the
exclusive purposes of (i) issuing and selling its Trust Securities, (ii) using
the proceeds from the sale of such Trust Securities to acquire a series of
Corresponding Junior Subordinated Debentures issued by the Corporation, and
(iii) engaging in only those other activities necessary or incidental thereto
(such as registering the transfer of the Trust Securities). Accordingly, the
Corresponding Junior Subordinated Debentures will be the sole assets of each
Issuer Trust, and payments under the Corresponding Junior Subordinated
Debentures will be the sole source of revenue of such Issuer Trust.
All of the Common Securities of each Issuer Trust will initially be owned by
the Corporation. The Common Securities of an Issuer Trust will rank pari
passu, and payments will be made thereon pro rata, with the Preferred
Securities of such Issuer Trust, except that upon the occurrence and during
the continuance of an event of default under a Declaration of Trust resulting
from a Debenture Event of Default (as defined below) arising as a result of
any failure by the Corporation to pay any amounts in respect of the Junior
Subordinated Debentures when due, the rights of the holder of all the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption or otherwise, will be subordinated to the rights of
the holders of the Preferred Securities of such Issuer Trust. See "Description
of Preferred Securities--Subordination of Common Securities". The Corporation
will acquire Common Securities in an aggregate Liquidation Amount equal to not
less than 3% of the total capital of each Issuer Trust.
Unless otherwise specified in the applicable Prospectus Supplement, each
Issuer Trust has a term of approximately 50 years, but may terminate earlier
as provided in the applicable Declaration of Trust. Each Issuer Trust's
business and affairs are conducted by its trustees, each appointed by the
Corporation as holder of all the Common Securities. The trustees for each
Issuer Trust will be Wilmington Trust Company, as the Property Trustee (the
"Property Trustee") and as Delaware Trustee (the "Delaware Trustee"), and two
individual trustees (the "Administrative Trustees") who are employees or
officers of or affiliated with the Corporation (collectively, the "Issuer
Trustees"). Wilmington Trust Company, as Property Trustee, will act as sole
indenture trustee under each Declaration of Trust for purposes of compliance
with the Trust Indenture Act. Wilmington Trust Company will also act as
trustee under the Guarantees and the Junior Subordinated Indenture. See
"Description of Guarantees" and "Description of Junior Subordinated
Debentures". The holder of all the Common Securities of an Issuer Trust, or
the holders of a majority in Liquidation Amount of the Related Preferred
Securities if an event of default under the Declaration of Trust for such
Issuer Trust has occurred and is continuing, will be entitled to appoint,
remove or replace the Property Trustee and/or the Delaware Trustee for such
Issuer Trust. In no event will the holders of the Preferred Securities have
the right to vote to appoint, remove or replace the Administrative Trustees;
such voting rights are vested exclusively in the holder of all the Common
Securities. The duties and obligations of each Issuer Trustee are governed by
the applicable Declaration of Trust. The Corporation will pay all fees and
expenses related to each Issuer Trust and the offering of the Preferred
Securities and will pay, directly or indirectly, all ongoing costs, expenses
and liabilities of each Issuer Trust.
The principal executive office of each Issuer Trust is c/o Bankers Trust New
York Corporation, 130 Liberty Street, New York, New York 10006 and its
telephone number is (212) 250-2500.
7
<PAGE>
USE OF PROCEEDS
Except as otherwise set forth in the applicable Prospectus Supplement, the
Corporation intends to use the proceeds from the sale of its Junior
Subordinated Debentures (including Corresponding Junior Subordinated
Debentures issued to the Issuer Trusts in connection with the investment by
the Issuer Trusts of all of the proceeds from the sale of Preferred
Securities) for general corporate purposes, including working capital, capital
expenditures, investments in or loans to subsidiaries, refinancing of debt,
including outstanding commercial paper and other short-term indebtedness,
redemption or repurchase of shares of its outstanding common and preferred
stock, the satisfaction of other obligations or for such other purposes as may
be specified in the applicable Prospectus Supplement.
The Corporation is required by the Federal Reserve to maintain certain
levels of capital for bank regulatory purposes. On October 21, 1996, the
Federal Reserve announced that cumulative preferred securities having the
characteristics of the Preferred Securities could be included as Tier 1
Capital for bank holding companies. Such Tier 1 Capital treatment, together
with the Corporation's ability to deduct, for federal income tax purposes
interest payable on the Junior Subordinated Debentures, will provide the
Corporation with a more cost-effective means of obtaining capital for bank
regulatory purposes than other Tier 1 Capital alternatives currently available
to it.
DESCRIPTION OF PREFERRED SECURITIES
Pursuant to the terms of the Declaration of Trust for each Issuer Trust, the
Issuer Trustees on behalf of such Issuer Trust will issue the Preferred
Securities and the Common Securities. The Preferred Securities of a particular
Issuer Trust will represent preferred undivided beneficial interests in the
assets of such Issuer Trust and the holders thereof will be entitled to a
preference in certain circumstances with respect to Distributions and amounts
payable on redemption or liquidation over the Common Securities of such Issuer
Trust, as well as other benefits as described in the related Declaration of
Trust. Each Declaration of Trust will be qualified as an indenture under the
Trust Indenture Act. Wilmington Trust Company, as Property Trustee of each
Issuer Trust, will act as trustee for the purposes of compliance with the
Trust Indenture Act. This summary of certain provisions of the Preferred
Securities and each Declaration of Trust, which summarizes the material terms
thereof, does not purport to be complete and is subject to, and is qualified
in its entirety by reference to, all the provisions of each Declaration of
Trust, including the definitions therein of certain terms, and the Trust
Indenture Act, to which reference is hereby made. Wherever particular defined
terms of a Declaration of Trust (as amended or supplemented from time to time)
are referred to herein or in a Prospectus Supplement, such defined terms are
incorporated herein or therein by reference. The form of the Declaration of
Trust has been filed as an exhibit to the Registration Statement of which this
Prospectus forms a part. Each of the Issuer Trusts is a legally separate
entity and the assets of one are not available to satisfy the obligations of
any of the others.
GENERAL
The Preferred Securities of an Issuer Trust will rank pari passu, and
payments will be made thereon pro rata, with the Common Securities of that
Issuer Trust except as described under "--Subordination of Common Securities".
Legal title to the Corresponding Junior Subordinated Debentures will be held
by the Property Trustee in trust for the benefit of the holders of the related
Trust Securities. Each Guarantee Agreement executed by the Corporation for the
benefit of the holders of an Issuer Trust's Trust Securities (the "Guarantee"
for such Preferred Securities) will be a guarantee on a subordinated basis
with respect to the related Trust Securities but will not guarantee payment of
Distributions or amounts payable on redemption or liquidation of such
Preferred Securities when the related Issuer Trust does not have funds on hand
available to make such payments. See "Description of Guarantees".
DISTRIBUTIONS
Distributions on the Preferred Securities will be cumulative, will
accumulate from the date of original issuance and will be payable on such
dates as specified in the applicable Prospectus Supplement. If any date on
which Distributions are payable on the Preferred Securities is not a Business
Day (as defined below), payment of the Distributions payable on such date will
be made on the next succeeding day that is a Business Day (without any
interest or other payment in respect to any such delay) except that, if such
Business Day is in the next succeeding calendar year, payment of such
Distribution will be made on the immediately preceding Business
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Day, in either case with the same force and effect as if made on such date
(each date on which Distributions are payable in accordance with the
foregoing, a "Distribution Date"). A "Business Day" means a day other than a
Saturday or a Sunday, or a day on which banking institutions in New York, New
York are authorized or required by law or executive order to remain closed or
a day on which the corporate trust office of the Property Trustee, the
Delaware Trustee or the Debenture Trustee is closed for business.
Each Issuer Trust's Preferred Securities represent preferred undivided
beneficial interests in the assets of such Issuer Trust, and Distributions on
each Preferred Security will be payable at the rate specified in the
applicable Prospectus Supplement. The amount of Distributions payable for any
period will be computed on the basis of a 360-day year of twelve 30-day months
unless otherwise specified in the applicable Prospectus Supplement.
Distributions to which holders of Preferred Securities are entitled will
accumulate additional Distributions at the rate per annum if and as specified
in the applicable Prospectus Supplement. The term "Distributions" as used
herein includes any such additional Distributions unless otherwise stated.
If provided in the applicable Prospectus Supplement, the Corporation will
have the right under the Junior Subordinated Indenture to defer the payment of
interest at any time or from time to time on any series of Corresponding
Junior Subordinated Debentures for up to such number of consecutive interest
payment periods as may be specified in such Prospectus Supplement relating to
such series (each, an "Extension Period"), provided that no Extension Period
may extend beyond the Stated Maturity of the Corresponding Junior Subordinated
Debentures as in effect at the time of the Corporation's election to defer
interest in this manner. As a consequence of any such election, Distributions
on the Related Preferred Securities would be deferred (but would continue to
accumulate additional Distributions thereon at the rate per annum set forth in
the Prospectus Supplement for such Preferred Securities) by the Issuer Trust
of such Preferred Securities during any such Extension Period. During any such
Extension Period, the Corporation may not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock or (ii) make any
payment of principal of or interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Corporation that rank pari
passu in all respects with or junior in interest to the Corresponding Junior
Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Corporation in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of any one or more employees, officers, directors or consultants,
in connection with a dividend reinvestment or stockholder stock purchase plan
or in connection with the issuance of capital stock of the Corporation (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock
of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any stockholder's rights plan, or the issuance of
rights, stock or other property under any stockholder's rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in
the form of stock, warrants, options or other rights where the dividend stock
or the stock issuable upon exercise of such warrants, options or other rights
is the same stock as that on which the dividend is being paid or ranks pari
passu with or junior to such stock).
The revenue of each Issuer Trust available for distribution to holders of
its Preferred Securities will be limited to payments under the Corresponding
Junior Subordinated Debentures in which the Issuer Trust will invest the
proceeds from the issuance and sale of its Trust Securities. See "Description
of Junior Subordinated Debentures--Corresponding Junior Subordinated
Debentures". If the Corporation does not make payments on such Corresponding
Junior Subordinated Debentures, the Issuer Trust will not have funds available
to pay Distributions or other amounts on the Related Preferred Securities. The
payment of Distributions and other amounts payable on the Preferred Securities
(if and to the extent the Issuer Trust has funds legally available therefor)
is guaranteed by the Corporation on a limited basis as set forth herein under
"Description of Guarantees".
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Distributions on the Preferred Securities will be payable to the holders
thereof as they appear on the register of such Issuer Trust on the relevant
record dates, which will be the fifteenth day (whether or not a Business Day)
prior to the relevant Distribution Date. For so long as such Preferred
Securities are held in book-entry form, subject to any applicable laws and
regulations and the provisions of the applicable Declaration of Trust, each
such payment will be made as described under "--Global Preferred Securities"
herein.
REDEMPTION OR EXCHANGE
Mandatory Redemption. Upon the repayment or redemption, in whole or in part,
of any Corresponding Junior Subordinated Debentures, whether at maturity or
upon earlier redemption as provided in the Junior Subordinated Indenture, the
proceeds from such repayment or redemption will be applied by the Property
Trustee to redeem a Like Amount (as defined below) of the Trust Securities,
upon not less than 30 nor more than 60 days notice, at a redemption price (the
"Redemption Price") equal to the aggregate Liquidation Amount (as defined
below) of such Trust Securities plus accumulated but unpaid Distributions
thereon to the date fixed for redemption (the "Redemption Date") and the
related amount of the premium, if any, paid by the Corporation upon the
concurrent redemption of such Corresponding Junior Subordinated Debentures.
See "Description of Junior Subordinated Debentures--Redemption". If less than
all of any series of Corresponding Junior Subordinated Debentures are to be
repaid or redeemed on a Redemption Date, then the proceeds from such repayment
or redemption will be allocated to the redemption pro rata of the Related
Preferred Securities and the Common Securities. The amount of premium, if any,
paid by the Corporation upon the redemption of all or any part of any series
of any Corresponding Junior Subordinated Debentures to be repaid or redeemed
on a Redemption Date will be allocated to the redemption pro rata of the
Related Preferred Securities and the Common Securities.
The Corporation will have the right to redeem any series of Corresponding
Junior Subordinated Debentures (i) on or after such date as may be specified
in the applicable Prospectus Supplement, in whole at any time or in part from
time to time, (ii) at any time, in whole (but not in part), within 90 days
following the occurrence and during the continuation of a Tax Event,
Investment Company Event or Capital Treatment Event with respect to such
series (or, if the approval of the Federal Reserve is then required for such
redemption, on such later date as promptly as reasonably practicable after
such approval is obtained) or (iii) as may be otherwise specified in the
applicable Prospectus Supplement. The Corporation has committed that it will
not exercise this right to redeem any series of Corresponding Junior
Subordinated Debentures without having received the prior approval by the
Federal Reserve, if then so required under applicable Federal Reserve capital
guidelines or policies.
Distribution of Corresponding Junior Subordinated Debentures. The
Corporation has the right at any time to dissolve any Issuer Trust and, after
satisfaction of the liabilities of creditors of such Issuer Trust as provided
by applicable law, cause such Corresponding Junior Subordinated Debentures in
respect of the Preferred Securities and Common Securities issued by such
Issuer Trust to be distributed to the holders of such Preferred Securities and
Common Securities in liquidation of the Issuer Trust. The Corporation has
committed that it will not take such action unless it has received prior
approval of the Federal Reserve to do so if such approval is then required
under applicable capital guidelines or policies of the Federal Reserve.
Tax Event, Investment Company Event or Capital Treatment Event
Redemption. Except as otherwise specified in the applicable Prospectus
Supplement, if a Tax Event, Investment Company Event or Capital Treatment
Event in respect of a series of Preferred Securities and Common Securities
shall occur and be continuing, the Corporation will have the right to redeem
the Corresponding Junior Subordinated Debentures in whole (but not in part)
and thereby cause a mandatory redemption of such Preferred Securities and
Common Securities in whole (but not in part) at a redemption price equal to
100% of the principal amount of such Junior Subordinated Debentures plus
accrued but unpaid interest thereon to the date fixed for redemption, within
90 days following the occurrence of such Tax Event, Investment Company Event
or Capital Treatment Event (or, if the approval of the Federal Reserve is then
required for such redemption, on such later date as promptly as is reasonably
practicable after such approval is obtained). If a Tax Event, Investment
Company Event or Capital Treatment Event in respect of a series of Preferred
Securities and Common Securities has occurred and is continuing and the
Corporation does not elect to redeem the Corresponding Junior Subordinated
Debentures and thereby cause a mandatory redemption of such Preferred
Securities or to liquidate the related Issuer Trust and
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cause the Corresponding Junior Subordinated Debentures to be distributed to
holders of such Preferred Securities and Common Securities in exchange
therefor upon liquidation of the Issuer Trust as described above, such
Preferred Securities will remain outstanding and Additional Sums (as defined
below) may be payable on the Corresponding Junior Subordinated Debentures.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by an Issuer Trust on
the outstanding Preferred Securities and Common Securities of the Issuer Trust
will not be reduced as a result of any additional taxes, duties and other
governmental charges to which such Issuer Trust has become subject as a result
of a Tax Event.
"Capital Treatment Event" means the reasonable determination by the
Corporation that, as a result of the occurrence of any amendment to, or change
(including any announced proposed change) in, the laws (or any rules or
regulations thereunder) of the United States or any political subdivision
thereof or therein, or as a result of any official or administrative
pronouncement or action or judicial decision interpreting or applying such
laws, rules or regulations, which amendment or change is effective or which
pronouncement, action or decision is announced on or after the date of
issuance of the Preferred Securities of an Issuer Trust, there is more than an
insubstantial risk that the Corporation will not be entitled to treat an
amount equal to the aggregate Liquidation Amount of such Preferred Securities
as "Tier 1 Capital" (or the then equivalent thereof) for purposes of the
capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Corporation.
"Investment Company Event" means the receipt by the Issuer Trust of an
opinion of counsel experienced in such matters to the effect that, as a result
of the occurrence of a change of law or regulation or a change (including any
announced proposed change) in interpretation or application of law or
regulation by an legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that the Issuer Trust is
or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or proposed change
becomes effective or would become effective, as the case may be, on or after
the date of the issuance of the Capital Securities.
"Like Amount" means (i) with respect to a redemption of any series of Trust
Securities, Trust Securities of such series having a Liquidation Amount (as
defined below) equal to that portion of the principal amount of Corresponding
Junior Subordinated Debentures to be contemporaneously redeemed in accordance
with the Junior Subordinated Indenture, and (ii) with respect to a
distribution of Corresponding Junior Subordinated Debentures to holders of any
series of Trust Securities in connection with a dissolution or liquidation of
the related Issuer Trust, Corresponding Junior Subordinated Debentures having
a principal amount equal to the Liquidation Amount of the Trust Securities of
the holder to whom such Junior Subordinated Debentures are distributed.
"Liquidation Amount" means the stated amount per Trust Security of $1,000
(or such other stated amount as is set forth in the applicable Prospectus
Supplement).
"Tax Event" with respect to an Issuer Trust means the receipt by the Issuer
Trust of a series of Preferred Securities of an opinion of counsel experienced
in such matters to the effect that, as a result of any amendment to, or change
(including any announced proposed change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or which pronouncement or
decision is announced on or after the date of issuance of such Preferred
Securities under the Declaration of Trust, there is more than an insubstantial
risk that (i) such Issuer Trust is, or will be within 90 days of the delivery
of such opinion, subject to United States federal income tax with respect to
income received or accrued on the corresponding series of Corresponding Junior
Subordinated Debentures, (ii) interest payable by the Corporation on such
series of Corresponding Junior Subordinated Debentures is not, or within 90
days of the delivery of such opinion, will not be, deductible by the
Corporation, in whole or in part, for United States federal income tax
purposes, or (iii) such Issuer Trust is, or will be within 90 days of the
delivery of such opinion, subject to more than a de minimis amount of other
taxes, duties or other governmental charges.
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Possible Tax Law Changes. On March 19, 1996, the Revenue Reconciliation Bill
of 1996 (the "Bill") the revenue portion of President Clinton's budget
proposal, was released. If it had been enacted, the Bill would have generally
denied interest deductions for interest on an instrument issued by a
corporation that has a maximum weighted average maturity of more than 40
years. The Bill also would have generally denied interest deductions for
interest on an instrument issued by a corporation that has a maximum term of
more than 20 years and that is not shown as indebtedness on the separate
balance sheet of the issuer or, where the instrument is issued to a related
party (other than a corporation), where the holder or some other related party
issues a related instrument that is not shown as indebtedness on the issuer's
consolidated balance sheet. For purposes of determining the weighted average
maturity or the term of an instrument, any right to extend would be treated as
exercised. The above-described provisions of the Bill were proposed to be
effective generally for instruments issued on or after December 7, 1995. If
similar provisions were to apply to the Junior Subordinated Debentures of any
series, the Corporation would be unable to deduct interest on the Junior
Subordinated Debentures of such series. On March 29, 1996, the Chairmen of the
Senate Finance and House Ways and Means Committees issued a joint statement to
the effect that it was their intention that the effective date of the
President's legislative proposals, if adopted, will be no earlier than the
date of appropriate Congressional action. Under current law, the Corporation
will be able to deduct interest on the Junior Subordinated Debentures. There
can be no assurance that current or future legislative proposals or final
legislation will not affect the ability of the Corporation to deduct interest
on the Junior Subordinated Debentures. Such a change could give rise to a Tax
Event, which may permit the Corporation to cause a redemption of the Preferred
Securities, as described more fully herein.
After the liquidation date fixed for any distribution of Corresponding
Junior Subordinated Debentures for any series of Preferred Securities (i) such
series of Preferred Securities will no longer be deemed to be outstanding,
(ii) the depositary or its nominee, as the record holder of such series of
Preferred Securities, will receive a registered global certificate or
certificates representing the Corresponding Junior Subordinated Debentures to
be delivered upon such distribution and (iii) any certificates representing
such series of Preferred Securities not held by the depositary or its nominee
will be deemed to represent the Corresponding Junior Subordinated Debentures
having a principal amount equal to the stated Liquidation Amount of such
series of Preferred Securities, and bearing accrued and unpaid interest in an
amount equal to the accumulated and unpaid Distributions on such series of
Preferred Securities until such certificates are presented to the securities
registrar for such Preferred Securities for transfer or reissuance.
There can be no assurance as to the market prices for the Preferred
Securities or the Corresponding Junior Subordinated Debentures that may be
distributed in exchange for Preferred Securities if a dissolution and
liquidation of an Issuer Trust were to occur. Accordingly, the Preferred
Securities that an investor may purchase, or the Corresponding Junior
Subordinated Debentures that the investor may receive on dissolution and
liquidation of an Issuer Trust, may trade at a discount to the price that the
investor paid to purchase the Preferred Securities offered hereby.
REDEMPTION PROCEDURES
Preferred Securities redeemed on each Redemption Date shall be redeemed at
the Redemption Price with the applicable proceeds from the contemporaneous
redemption of the Corresponding Junior Subordinated Debentures. Redemptions of
the Preferred Securities will be made and the Redemption Price will be payable
on each Redemption Date only to the extent that the related Issuer Trust has
funds on hand available for the payment of such Redemption Price. See "--
Subordination of Common Securities".
If the Issuer Trust gives a notice of redemption in respect of its Preferred
Securities, then, by 12:00 noon, New York City time, on the Redemption Date,
to the extent funds are available, in the case of Preferred Securities held in
book-entry form, the Property Trustee will deposit irrevocably with the
depositary funds sufficient to pay the applicable Redemption Price and will
give the depositary irrevocable instructions and authority to pay the
Redemption Price to the holders of such Preferred Securities. See "Global
Preferred Securities" herein. With respect to Preferred Securities not held in
book-entry form, the Property Trustee, to the extent funds are available, will
irrevocably deposit with the paying agent for such Preferred Securities funds
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sufficient to pay the applicable Redemption Price and will give such paying
agent irrevocable instructions and authority to pay the Redemption Price to
the holders thereof upon surrender of their certificates evidencing such
Preferred Securities. Notwithstanding the foregoing, Distributions payable on
or prior to the Redemption Date for any Preferred Securities called for
redemption will be payable to the holders of such Preferred Securities on the
relevant record dates for the related Distribution Dates. If notice of
redemption has been given and funds deposited as required, then upon the date
of such deposit, all rights of the holders of such Preferred Securities so
called for redemption will cease, except the right of the holders of such
Preferred Securities to receive the Redemption Price and any Distribution
payable in respect of the Preferred Securities on or prior to the Redemption
Date, but without interest on such Redemption Price, and such Preferred
Securities will cease to be outstanding. If any date fixed for redemption of
Preferred Securities is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (without any interest or other payment in respect of any such
delay), except that, if such Business Day falls in the next calendar year,
such payment will be made on the immediately preceding Business Day, in each
case, with the same force and effect as if made on such date. If payment of
the Redemption Price in respect of Preferred Securities called for redemption
is improperly withheld or refused and not paid either by the Issuer Trust or
by the Corporation pursuant to the Guarantee as described under "Description
of Guarantees", Distributions on such Preferred Securities will continue to
accumulate at the then applicable rate, from the Redemption Date originally
established by the Issuer Trust for such Preferred Securities to the date such
Redemption Price is actually paid, in which case the actual payment date will
be the date fixed for redemption for purposes of calculating the Redemption
Price.
Subject to applicable law (including, without limitation, United States
federal securities law), the Corporation or its subsidiaries may at any time
and from time to time purchase outstanding Preferred Securities by tender, in
the open market or by private agreement and may resell such securities.
Payment of the Redemption Price on the Preferred Securities and any
distribution of Corresponding Junior Subordinated Debentures to holders of
Preferred Securities will be made to the applicable holders of the Preferred
Securities as they appear on the register for such Preferred Securities on the
relevant record date, which shall be the fifteenth day (whether or not a
Business Day) prior to the relevant Redemption Date or liquidation date, as
applicable.
If less than all of the Preferred Securities and Common Securities issued by
an Issuer Trust are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of such Preferred Securities and Common Securities to be
redeemed shall be allocated pro rata to the Preferred Securities and the
Common Securities based upon the relative Liquidation Amounts of such classes.
The particular Preferred Securities to be redeemed will be selected on a pro
rata basis not more than 60 days prior to the Redemption Date by the Property
Trustee from the outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or an integral multiple of $1,000 in excess thereof, unless a
different amount is specified in the applicable Prospectus Supplement) of the
Liquidation Amount of Preferred Securities of a denomination larger than
$1,000 (or such other denomination as is specified in the applicable
Prospectus Supplement) or if the Preferred Securities are then held in the
form of a Global Preferred Security (as defined below), in accordance with the
depositary's customary procedures. The Property Trustee will promptly notify
the securities registrar for the Preferred Securities in writing of the
Preferred Securities selected for redemption and, in the case of any Preferred
Securities selected for partial redemption, the Liquidation Amount thereof to
be redeemed. For all purposes of each Declaration of Trust, unless the context
otherwise requires, all provisions relating to the redemption of Preferred
Securities will relate, in the case of any Preferred Securities redeemed or to
be redeemed only in part, to the portion of the aggregate Liquidation Amount
of Preferred Securities that has been or is to be redeemed.
Notice of any redemption will be mailed not less than 30 days but not more
than 60 days before the Redemption Date to each registered holder of Trust
Securities to be redeemed at its address appearing on the securities register
for the Preferred Securities. Unless the Corporation defaults in payment of
the Redemption
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Price on the Corresponding Junior Subordinated Debentures, on and after the
Redemption Date interest will cease to accrue on such Junior Subordinated
Debentures or portions thereof (and, unless payment of the Redemption Price in
respect of the Preferred Securities is withheld or refused and not paid either
by the Issuer Trust or the Corporation pursuant to the Guarantee,
Distributions will cease to accumulate on the Related Preferred Securities or
portions thereof) called for redemption.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, each Issuer
Trust's Preferred Securities and Common Securities, as applicable, will be
made pro rata based on the Liquidation Amount of such Preferred Securities and
Common Securities. However, if on any Distribution Date, Redemption Date or
Liquidation Date a Debenture Event of Default has occurred and is continuing
as a result of any failure by the Corporation to pay any amounts in respect of
the Corresponding Junior Subordinated Debentures when due, no payment of any
Distribution on, or Redemption Price of, or Liquidation Distribution in
respect of, any of the Issuer Trust's Common Securities, and no other payment
on account of the redemption, liquidation or other acquisition of such Common
Securities, will be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the Issuer Trust's outstanding Preferred
Securities for all Distribution periods terminating on or prior thereto, or in
the case of payment of the Redemption Price the full amount of such Redemption
Price on all of the Issuer Trust's outstanding Preferred Securities then
called for redemption, or in the case of payment of the Liquidation
Distribution the full amount of such Liquidation Distribution on all
Outstanding Preferred Securities, will have been made or provided for, and all
funds available to the Property Trustee will first be applied to the payment
in full in cash of all Distributions on, or Redemption Price of, the Issuer
Trust's Preferred Securities then due and payable.
In the case of any Event of Default (as defined below) under the applicable
Declaration of Trust resulting from a Debenture Event of Default, the holder
of all such Issuer Trust's Common Securities, will be deemed to have waived
any right to act with respect to any such Event of Default under such
Declaration of Trust until the effect of all such Events of Default with
respect to such Preferred Securities have been cured, waived or otherwise
eliminated. Until all such Events of Default under the applicable Declaration
of Trust with respect to the Preferred Securities have been so cured, waived
or otherwise eliminated, the Property Trustee will act solely on behalf of the
holders of such Preferred Securities and not on behalf of the holder of all
the Issuer Trust's Common Securities, and only the holders of such Preferred
Securities will have the right to direct the Property Trustee to act on their
behalf.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
Pursuant to each Declaration of Trust, each Issuer Trust will automatically
dissolve, and its affairs will be wound up, upon expiration of its term or, if
earlier, will dissolve, and its affairs will be wound up, on the first to
occur of: (i) certain events of bankruptcy, dissolution or liquidation of the
Corporation; (ii) the distribution of a Like Amount of the Corresponding
Junior Subordinated Debentures to the holders of its Trust Securities, if the
Corporation, as holder of all the Common Securities, has given written
direction to the Property Trustee to dissolve such Issuer Trust (which
direction, subject to the foregoing restrictions, is optional and wholly
within the discretion of the holder of all the Common Securities); (iii)
redemption of all of the Issuer Trust's Preferred Securities as described
under "Description of Preferred Securities--Redemption or Exchange--Mandatory
Redemption"; and (iv) the entry of an order for the dissolution of the Issuer
Trust by a court of competent jurisdiction. The Corporation has committed to
the Federal Reserve not to exercise its right to cause the dissolution of any
Issuer Trust without having received the prior approval of the Federal Reserve
to do so, if then required under applicable Federal Reserve capital guidelines
or policies.
If dissolution of an Issuer Trust occurs as described in clause (i), (ii) or
(iv) above, the Issuer Trust will be liquidated by the Property Trustee as
expeditiously as the Property Trustee determines to be possible by
distributing, after satisfaction of liabilities to creditors of such Issuer
Trust as provided by applicable law, to the holders of such Trust Securities a
Like Amount of the Corresponding Junior Subordinated Debentures, unless such
distribution is determined by the Property Trustee not to be practical, in
which event such holders will be entitled to receive out of the assets of the
Issuer Trust available for distribution to holders, after
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satisfaction of liabilities to creditors of such Issuer Trust as provided by
applicable law, an amount equal to the aggregate of the Liquidation Amount
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If such Liquidation Distribution
can be paid only in part because such Issuer Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by such Issuer Trust on its Trust Securities will be
paid on a pro rata basis. The holder of all such Issuer Trust's Common
Securities will be entitled to receive distributions upon any such liquidation
pro rata with the holders of its Preferred Securities, except that if a
Debenture Event of Default has occurred and is continuing, as a result of any
failure by the Corporation to pay any amounts in respect of the Junior
Subordinated Debentures when due, the Preferred Securities will have a
priority over the Common Securities.
EVENTS OF DEFAULT; NOTICE
Any of the following events constitutes an "Event of Default" under each
Declaration of Trust with respect to the Preferred Securities issued
thereunder (whatever the reason for such Event of Default and whether it is
voluntary or involuntary or is effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of a Debenture Event of Default under the Junior
Subordinated Indenture (see "Description of Junior Subordinated
Debentures--Debenture Events of Default"); or
(ii) default by the Issuer Trust in the payment of any Distribution when
it becomes due and payable, and continuation of such default for a period
of 30 days; or
(iii) default by the Issuer Trust in the payment of any Redemption Price
of any Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Issuer Trustees in such Declaration of
Trust (other than a covenant or warranty a default in the performance of
which or the breach of which is dealt with in clause (ii) or (iii) above),
and continuation of such default or breach for a period of 60 days after
there has been given, by registered or certified mail, to the defaulting
Issuer Trustee or Trustees by the holders of at least 25% in aggregate
Liquidation Amount of the outstanding Preferred Securities of the
applicable Issuer Trust, a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice is a "Notice
of Default" under such Declaration of Trust; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee if a successor Property Trustee has not
been appointed within 90 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee will transmit
notice of such Event of Default to the holders of such Issuer Trust's
Preferred Securities and the Administrative Trustees and the Corporation,
unless such Event of Default has been cured or waived. The Corporation, as
Depositor, and the Administrative Trustees are required to file annually with
the Property Trustee a certificate as to whether or not they are in compliance
with all the conditions and covenants applicable to them under each
Declaration of Trust under which any Preferred Securities are then
outstanding.
If a Debenture Event of Default has occurred and is continuing as a result
of any failure by the Corporation to pay any amounts in respect of the
Corresponding Junior Subordinated Debentures when due, the Preferred
Securities will have a preference over the Common Securities with respect to
payments of any amounts in respect of the Preferred Securities as described
above. See "--Liquidation Distribution Upon Dissolution".
The existence of an Event of Default does not entitle the holders of
Preferred Securities to accelerate the maturity thereof.
REMOVAL OF ISSUER TRUSTEES
Unless a Debenture Event of Default has occurred and is continuing in
respect of the Corresponding Junior Subordinated Debentures, any Issuer
Trustee may be removed at any time by the holder of all the Common
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Securities issued by the applicable Issuer Trust. If a Debenture Event of
Default has occurred and is continuing, the Property Trustee and the Delaware
Trustee may be removed at such time by the holders of a majority in
Liquidation Amount of the outstanding Preferred Securities. In no event will
the holders of the Preferred Securities have the right to vote to appoint,
remove or replace the Administrative Trustees, which voting rights are vested
exclusively in the Corporation, as the holder of the Common Securities. No
resignation or removal of an Issuer Trustee and no appointment of a successor
trustee will be effective until the acceptance of appointment by the successor
trustee in accordance with the provisions of the applicable Declaration of
Trust.
CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an Event of Default has occurred and is continuing under the
applicable Declaration of Trust, at any time or from time to time, for the
purpose of meeting the legal requirements of the Trust Indenture Act or of any
jurisdiction in which any part of the property of any Issuer Trust may at the
time be located, the Corporation, as the holder of the Common Securities, and
the Administrative Trustees will have power to appoint one or more persons
either to act as a co-trustee, jointly with the Property Trustee of such
Issuer Trust, of all or any part of such Issuer Trust's property, or to act as
separate trustee of any such property, in either case with such powers as may
be provided in the instrument of appointment, and to vest in such person or
persons in such capacity any property, title, right or power deemed necessary
or desirable, subject to the provisions of the applicable Declaration of
Trust. If a Debenture Event of Default has occurred and is continuing, the
Property Trustee alone will have power to make such appointment.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any entity into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any entity
resulting from any merger, conversion or consolidation to which such Issuer
Trustee is a party, or any entity succeeding to all or substantially all the
corporate trust business of such Issuer Trustee, will be the successor of such
Issuer Trustee under the Declaration of Trust, provided such entity is
otherwise qualified and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE ISSUER TRUSTS
An Issuer Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any entity, except as described below or as
otherwise set forth in the applicable Declaration of Trust. An Issuer Trust
may, at the request of the holder of all the Common Securities and with the
consent of the Administrative Trustees, but without the consent of the holders
of the outstanding Preferred Securities issued by such Issuer Trust, merge
with or into, consolidate, amalgamate, or be replaced by or convey, transfer
or lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State, so long as (i) such successor
entity either (a) expressly assumes all of the obligations of such Issuer
Trust with respect to such Preferred Securities or (b) substitutes for the
Preferred Securities other securities having substantially the same terms as
the Preferred Securities (the "Successor Securities") so long as the Successor
Securities rank the same as the Preferred Securities in priority with respect
to distributions and payments upon liquidation, redemption and otherwise, (ii)
a trustee of such successor entity, possessing the same powers and duties as
the Property Trustee is appointed to hold the Corresponding Junior
Subordinated Debentures, (iii) the Successor Securities are listed, or any
Successor Securities will be listed upon notification of issuance, on any
national securities exchange or other organization on which such Preferred
Securities are then listed, if any, (iv) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause such
Preferred Securities (including Successor Securities) to be downgraded by any
nationally recognized statistical rating organization which assigns ratings to
such Preferred Securities, (v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the holders of such Preferred Securities
(including any Successor Securities) in any material respect, (vi) such
successor entity has a purpose substantially identical to that of the Issuer
Trust, (vii) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease, the Issuer Trust has received an opinion from
independent counsel to the
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Corporation or the Issuer Trust experienced in such matters to the effect that
(a) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not adversely affect the rights, preferences and
privileges of the holders of such Preferred Securities (including any
Successor Securities) in any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease,
neither the Issuer Trust nor such successor entity will be required to
register as an investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act"), and (viii) the Corporation or any
permitted successor or assignee owns all of the common securities of such
successor entity and guarantees the obligations of such successor entity under
the Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, an Issuer Trust may not, except with the
consent of holders of 100% in aggregate Liquidation Amount of the Preferred
Securities, consolidate, amalgamate, merge with or into, or be replaced by or
convey, transfer or lease its properties and assets substantially as an
entirety to, any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause
the Issuer Trust or the successor entity to be classified as an association
taxable as a corporation or as other than a grantor trust for United States
federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF EACH DECLARATION OF TRUST
Except as provided below and under "Description of Guarantees--Amendments
and Assignment" and as otherwise required by law and the applicable
Declaration of Trust, the holders of the Preferred Securities will have no
voting rights.
Each Declaration of Trust may be amended from time to time by the holders of
all the Common Securities and the Issuer Trustees, without the consent of the
holders of the Preferred Securities (i) to cure any ambiguity, correct or
supplement any provisions in such Declaration of Trust that may be
inconsistent with any other provision, or to make any other provisions with
respect to matters or questions arising under such Declaration of Trust, which
are not inconsistent with the other provisions of such Declaration of Trust,
provided that any such amendment does not adversely affect in any material
respect the interests of any holder of Trust Securities, or (ii) to modify,
eliminate or add to any provisions of such Declaration of Trust to such extent
as may be necessary to ensure that the Issuer Trust will not be taxable as a
corporation or will be taxable as a grantor trust for United States income tax
purposes at all times that any Trust Securities are outstanding or to ensure
that the Issuer Trust will not be required to register as an "investment
company" under the Investment Company Act and any amendments of such
Declaration of Trust will become effective when notice thereof is given to the
holders of Trust Securities. Each Declaration of Trust may be amended by the
Issuer Trustees and the holder of all the Common Securities with (i) the
consent of holders representing not less than a majority in aggregate
Liquidation Amount of the outstanding Preferred Securities and (ii) receipt by
the Issuer Trustees of an opinion of counsel to the effect that such amendment
or the exercise of any power granted to the Issuer Trustees in accordance with
such amendment will not cause the Issuer Trust to be classified as an
association taxable as a corporation or affect the Issuer Trust's status as a
grantor trust for United States federal income tax purposes or the Issuer
Trust's exemption from status as an "investment company" under the Investment
Company Act, except that without the consent of each holder of Trust
Securities, such Declaration of Trust may not be amended to (i) change the
amount or timing of any Distribution on the Trust Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Trust Securities as of a specified date or (ii) restrict the right of a
holder of Trust Securities to institute suit for the enforcement of any such
payment on or after such date.
So long as any Corresponding Junior Subordinated Debentures are held by the
Issuer Trust, the Property Trustee will not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Debenture
Trustee, or execute any trust or power conferred on the Property Trustee with
respect to such Corresponding Junior Subordinated Debentures, (ii) waive any
past default that is waivable under Section 5.13 of the Junior Subordinated
Indenture, (iii) exercise any right to rescind or annul a declaration that the
Junior Subordinated Debentures will be due and payable or (iv) consent to any
amendment, modification or termination of the Junior Subordinated Indenture or
such Corresponding Junior Subordinated Debentures, where such consent
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will be required, without, in each case, obtaining the prior approval of the
holders of at least a majority in aggregate Liquidation Amount of all
outstanding Preferred Securities; except that if a consent under the Junior
Subordinated Indenture would require the consent of each holder of
Corresponding Junior Subordinated Debentures affected thereby, no such consent
will be given by the Property Trustee without the prior consent of each holder
of the corresponding Preferred Securities. The Property Trustee may not revoke
any action previously authorized or approved by a vote of the holders of the
Preferred Securities except by subsequent vote of the holders of the Preferred
Securities. The Property Trustee will notify each holder of Preferred
Securities of any notice of default with respect to the Corresponding Junior
Subordinated Debentures. In addition to obtaining the foregoing approvals of
the holders of the Preferred Securities, before taking any of the foregoing
actions, the Property Trustee will obtain an opinion of counsel experienced in
such matters to the effect that the Issuer Trust will not be classified as an
association taxable as a corporation for United States federal income tax
purposes on account of such action and such action would not cause the Issuer
Trust to be classified as other than a grantor trust for United States Federal
income tax purposes.
Any required approval of holders of Preferred Securities may be given at a
meeting of holders of Preferred Securities convened for such purpose or
pursuant to written consent. The Property Trustee will cause a notice of any
meeting at which holders of Preferred Securities are entitled to vote, or of
any matter upon which action by written consent of such holders is to be
taken, to be given to each registered holder of Preferred Securities in the
manner set forth in each Declaration of Trust.
No vote or consent of the holders of Preferred Securities will be required
for an Issuer Trust to redeem and cancel its Preferred Securities in
accordance with the applicable Declaration of Trust.
Notwithstanding that holders of Preferred Securities are entitled to vote or
consent under any of the circumstances described above, any of the Preferred
Securities that are owned by the Corporation, the Issuer Trustees or any
affiliate of the Corporation or any Issuer Trustees, will, for purposes of
such vote or consent, be treated as if they were not outstanding.
GLOBAL PREFERRED SECURITIES
The Preferred Securities of a series may be issued in the form of one or
more global certificates (collectively, with respect to each series or issue
of Preferred Securities, the "Global Preferred 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 and the Issuer Trusts have been
informed by DTC that its nominee will be Cede & Co. ("Cede"). Accordingly,
Cede is expected to be the initial registered holder of the Preferred
Securities that are issued in global form. No person that acquires an interest
in such Preferred Securities will be entitled to receive a certificate
representing such person's interest in such Preferred Securities except as set
forth herein or in the applicable Prospectus Supplement. Unless and until
definitive Preferred Securities are issued under the limited circumstances
described herein, all references to actions by holders of Preferred 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 such holders shall refer to payments and notices to
DTC or Cede, as the registered holder of such Preferred Securities.
DTC has informed the Corporation and the Issuer Trust 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.
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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,
Preferred 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 relevant Issuer Trust 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 Property Trustee, the applicable Administrative Trustees, the
relevant Issuer Trust or the Corporation as registered holders of the
Preferred Securities entitled to the benefits of the applicable Declaration of
Trust or the terms of the Preferred Securities. 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 Preferred Securities among Participants and to
receive and transmit payments to Participants. Participants and Indirect
Participants with which holders have accounts with respect to the Preferred
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 Preferred Securities to persons or entities that do not participate in
the DTC system, or to otherwise act with respect to such Preferred Securities,
may be limited due to the absence of physical certificates for such Preferred
Securities.
DTC has advised the Corporation and the Issuer Trusts that DTC will take any
action permitted to be taken by a registered holder of any Preferred
Securities under the applicable Declaration of Trust or the terms of the
Preferred Securities only at the direction of one or more Participants to
whose accounts with DTC such Preferred Securities are credited.
Unless otherwise specified in the applicable Prospectus Supplement, a Global
Preferred Security will be exchangeable for the relevant definitive Preferred
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 Preferred 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 depositary,
(ii) the relevant Issuer Trust in its sole discretion determines that the
Global Preferred Security will be so exchangeable or (iii) an Event of Default
has occurred and is continuing. Any Global Preferred Security that is
exchangeable pursuant to the preceding sentence will be exchangeable for
Preferred Securities or definitive Preferred Securities 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 Preferred Securities. Upon surrender by
DTC of the Global Preferred Security representing the Preferred Securities and
delivery of instructions for re-registration, the Administrative Trustees will
reissue the Preferred Securities as definitive Preferred Securities, and
thereafter the Issuer Trustees, the Issuer Trust and the Corporation will
recognize the holders of such definitive Preferred Securities as registered
holders of Preferred Securities entitled to the benefits of the applicable
Junior Subordinated Indenture or the terms of the Preferred Securities, as the
case may be.
Except as described above, the Global Preferred 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 relevant Issuer Trust. Except as described above, DTC may not sell,
assign, transfer or
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otherwise convey any beneficial interest in a Global Preferred Security
evidencing all or part of the Preferred Securities unless such beneficial
interest is in an amount equal to an authorized denomination for the Preferred
Securities.
PAYMENT AND PAYING AGENCY
Payments in respect of the Preferred Securities will be made to the
depositary, which will credit the relevant accounts at the depositary on the
applicable Distribution Dates or, if any Issuer Trust's Preferred Securities
are not held by the depositary, such payments will be made by check mailed to
the address of the holder entitled thereto as such address shall appear on the
securities register relating to the Preferred Securities. Unless otherwise
specified in the applicable Prospectus Supplement, the paying agent (the
"Paying Agent") will initially be the Property Trustee and any co-paying agent
chosen by the Property Trustee and acceptable to the Administrative Trustees
and the Corporation. The Paying Agent will be permitted to resign as Paying
Agent upon 30 days' written notice to the Property Trustee and the
Administrative Trustees. If the Property Trustee is no longer the Paying
Agent, the Administrative Trustees will appoint a successor (which must be a
bank or trust company reasonably acceptable to the Corporation) to act as
Paying Agent.
REGISTRAR AND TRANSFER AGENT
Unless otherwise specified in the applicable Prospectus Supplement, the
Property Trustee will act as registrar and transfer agent for the Preferred
Securities.
Registration of transfers of Preferred Securities will be effected without
charge by or on behalf of each Issuer Trust, but upon payment of any tax or
other governmental charges that may be imposed in connection with any transfer
or exchange. The Issuer Trusts will not be required to register or cause to be
registered the transfer of their Preferred Securities after such Preferred
Securities have been called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance of an
Event of Default, undertakes to perform only such duties as are specifically
set forth in each Declaration of Trust and, after such Event of Default, must
exercise the same degree of care and skill as a prudent person would exercise
or use in the conduct of his or her own affairs. The Property Trustee is under
no obligation to exercise any of the powers vested in it by the applicable
Declaration of Trust at the request of any holder of Trust Securities unless
it is offered reasonable indemnity against the costs, expenses and liabilities
that might be incurred thereby. The Property Trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Property Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it. If no Event
of Default has occurred and is continuing and the Property Trustee is required
to decide between alternative causes of action, or construe ambiguous
provisions in the applicable Declaration of Trust, or is unsure of the
application of any provision of the applicable Declaration of Trust, and the
matter is not one on which holders of Trust Securities are entitled under such
Declaration of Trust to vote, then the Property Trustee will take such action
as is directed by the Corporation and, if not so directed, will take such
action as it deems advisable and in the best interests of the holders of the
Trust Securities and will have no liability except for its own bad faith,
negligence or willful misconduct.
Wilmington Trust Company, the Property Trustee, currently serves and may
serve from time to time in the future as trustee under other indentures or
declarations of trust with the Corporation or its subsidiaries or affiliates
relating to other issues of their securities. In addition, the Corporation and
certain of its affiliates may have other banking relationships with Wilmington
Trust Company.
GOVERNING LAW
Each Declaration of Trust and the Trust Securities issued thereunder will be
governed by and construed in accordance with the laws of the State of
Delaware.
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MISCELLANEOUS
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Issuer Trusts in such a way that no Issuer Trust
will be deemed to be an "investment company" required to be registered under
the Investment Company Act or classified as an association taxable as a
corporation or as other than a grantor trust for United States federal income
tax purposes and so that the Corresponding Junior Subordinated Debentures will
be treated as indebtedness of the Corporation for United States Federal income
tax purposes. In this connection, the holder of all the Common Securities and
the Administrative Trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of each Issuer
Trust or each Declaration of Trust, that the holder of all the Common
Securities and the Administrative Trustees determine in their discretion to be
necessary or desirable for such purposes, as long as such action does not
materially adversely affect the interests of the holders of the related
Preferred Securities.
Holders of the Preferred Securities have no preemptive or similar rights.
No Issuer Trust may borrow money or issue debt or mortgage or pledge any of
its assets.
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures are to be issued in one or more series
under a Junior Subordinated Indenture, as modified or supplemented from time
to time (as so modified or supplemented, the "Junior Subordinated Indenture"),
between the Corporation and Wilmington Trust Company, as trustee (the
"Debenture Trustee"). This summary of certain terms and provisions of the
Junior Subordinated Debentures, Corresponding Junior Subordinated Debentures
and the Junior Subordinated Indenture, which summarizes the material
provisions thereof, does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, the Junior Subordinated Indenture,
the form of which is filed as an exhibit to the Registration Statement of
which this Prospectus forms a part, and to the Trust Indenture Act, to each of
which reference is hereby made. The Junior Subordinated Indenture is qualified
under the Trust Indenture Act. Whenever particular defined terms of the Junior
Subordinated Indenture are referred to herein or in the applicable Prospectus
Supplement, such defined terms are incorporated herein or therein by
reference.
GENERAL
Unless otherwise specified in the applicable Prospectus Supplement, each
series of Junior Subordinated Debentures will rank pari passu with all other
series of Junior Subordinated Debentures and will be unsecured and subordinate
and junior in right of payment to the extent and in the manner set forth in
the Indenture to all Senior Indebtedness (as defined below) of the
Corporation. See "--Subordination". The Corporation is a holding company and
almost all of the operating assets of the Corporation and its consolidated
subsidiaries are owned by such subsidiaries. The Corporation relies primarily
on dividends from such subsidiaries to meet its obligations. Because the
Corporation is a holding company, the right of the Corporation to participate
in any distribution of assets of any subsidiary, including Bankers, upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability
of holders of such Junior Subordinated Debentures to benefit indirectly from
such distribution), is subject to the prior claims of creditors of the
subsidiary, except to the extent the Corporation may itself be a creditor of
that subsidiary and its claims are recognized. There are various legal
limitations on the extent to which certain of the Corporation's subsidiaries
may extend credit, pay dividends or otherwise supply funds to the Corporation
or certain of its other subsidiaries. Accordingly, the Junior Subordinated
Debentures will be effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders of Junior
Subordinated Debentures should look only to the assets of the Corporation for
payments on the Junior Subordinated Debentures. Except as otherwise provided
in the applicable Prospectus Supplement, the Junior Subordinated Indenture
does not limit the incurrence or issuance of other secured or unsecured debt
of the Corporation, including Senior Indebtedness, whether under the Junior
Subordinated Indenture, any other existing
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indenture or any other indenture that the Corporation may enter into in the
future or otherwise. See "--Subordination" and the applicable Prospectus
Supplement.
Each series of Junior Subordinated Debentures will be issuable pursuant to
an indenture supplemental to the Junior Subordinated Indenture or a resolution
of the Corporation's Board of Directors or a committee thereof or designated
thereby.
The applicable Prospectus Supplement will describe the following terms of
the Junior Subordinated Debentures, where applicable and to the extent not set
forth herein: (1) the title of the Junior Subordinated Debentures; (2) any
limit upon the aggregate principal amount of the Junior Subordinated
Debentures; (3) the date or dates on which the principal of the Junior
Subordinated Debentures is payable (the "Stated Maturity") or the method of
determination thereof and the right, if any, of the Corporation to shorten or
extend such maturity; (4) the rate or rates, if any, at which the Junior
Subordinated Debentures will bear interest or the method of determination
thereof, the dates on which any such interest will be payable (the "Interest
Payment Dates"), the right, if any, of the Corporation to defer or extend an
Interest Payment Date, and the record dates for any interest payable on any
Interest Payment Date or the method by which any of the foregoing will be
determined; (5) the place or places where, subject to the terms of the Junior
Subordinated Indenture as described below under "--Payment and Paying Agents",
the principal of (and premium, if any) and interest on the Junior Subordinated
Debentures will be payable and where, subject to the terms of the Junior
Subordinated Indenture as described below under "--Denominations, Registration
and Transfer", the Junior Subordinated Debentures may be presented for
registration of transfer or exchange and the place or places where notices and
demands to or upon the Corporation in respect of the Junior Subordinated
Debentures and the Junior Subordinated Indenture may be made (each, a "Place
of Payment"); (6) the obligation or the right, if any, of the Corporation or a
holder thereof to redeem, purchase or repay the Junior Subordinated Debentures
and the period or periods within which or date or dates on which, the price or
prices at which, the currency or currencies (including currency unit or units)
in which and the other terms and conditions upon which the Junior Subordinated
Debentures may be redeemed, repaid or purchased, in whole or in part, pursuant
to such right or obligation; (7) the denominations in which any Junior
Subordinated Debentures will be issuable if other than denominations of $1,000
and any integral multiple thereof; (8) if other than in U.S. Dollars, the
currency or currencies (including currency unit or units) in which the
principal of (and premium, if any) and interest on the Junior Subordinated
Debentures is payable, or in which the Junior Subordinated Debentures will be
denominated; (9) any additions, modifications or deletions in the events of
default under the Junior Subordinated Indenture or covenants of the
Corporation specified in the Junior Subordinated Indenture with respect to the
Junior Subordinated Debentures; (10) if other than the principal amount
thereof, the portion of the principal amount of Junior Subordinated Debentures
that will be payable upon declaration of acceleration of the maturity thereof;
(11) any additions or changes to the Junior Subordinated Indenture with
respect to the Junior Subordinated Debentures as may be necessary to permit or
facilitate the issuance of such series in bearer form, registrable or not
registrable as to principal, and with or without interest coupons; (12) any
index or indices used to determine the amount of payments of principal of (and
premium, if any) on the Junior Subordinated Debentures and the manner in which
such amounts will be determined; (13) the terms and conditions relating to the
issuance of a temporary Global Security representing all of the Junior
Subordinated Debentures of such series and the exchange of such temporary
Global Security for definitive Junior Subordinated Debentures of such series;
(14) subject to the terms described herein under "--Global Junior Subordinated
Debentures", whether the Junior Subordinated Debentures of such series will be
issued in whole or in part in the form of one or more Global Securities and,
in such case, the form of and Depositary for such Global Securities, which
Depositary must be a clearing agency registered under the Exchange Act; (15)
the appointment of any paying agent or agents; (16) the terms and conditions
of any obligation or right of the Corporation or a holder to convert or
exchange the Junior Subordinated Debentures into any other series of Junior
Subordinated Debentures or into any series of Preferred Securities; (17) the
form of Declaration of Trust, Guarantee Agreement and Expense Agreement, if
applicable, relating to such Junior Subordinated Debentures; (18) the relative
degree, if any, to which such Junior Subordinated Debentures will be senior to
or be subordinated to other series of Junior Subordinated Debentures or other
indebtedness of the Corporation in right of payment, whether such other series
of Junior Subordinated Debentures or other
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indebtedness are outstanding or not; and (19) any other terms of the Junior
Subordinated Debentures not inconsistent with the provisions of the Junior
Subordinated Indenture.
Junior Subordinated Debentures may be sold at a substantial discount below
their stated principal amount, bearing no interest or interest at a rate that
at the time of issuance is below market rates. Certain United States federal
income tax consequences and special considerations applicable to any such
Junior Subordinated Debentures will be described in the applicable Prospectus
Supplement.
If the purchase price of any series of Junior Subordinated Debentures is
payable in one or more foreign currencies or currency units or if any series
of Junior Subordinated Debentures are denominated in one or more foreign
currencies or currency units or if the principal of (or premium, if any) or
interest, if any, on any series of Junior Subordinated Debentures is payable
in one or more foreign currencies or currency units, the restrictions,
elections, certain United States Federal income tax consequences, specific
terms and other information with respect to such series of Junior Subordinated
Debentures and such foreign currency or currency units will be set forth in
the applicable Prospectus Supplement.
If any index is used to determine the amount of payments of principal of (or
premium, if any) or interest on any series of Junior Subordinated Debentures,
special United States federal income tax, accounting and other considerations
applicable thereto will be described in the applicable Prospectus Supplement.
DENOMINATIONS, REGISTRATION AND TRANSFER
Unless otherwise specified in the applicable Prospectus Supplement, the
Junior Subordinated Debentures will be issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
Junior Subordinated Debentures of any series will be exchangeable for other
Junior Subordinated Debentures of the same issue and series, of any authorized
denominations, of a like aggregate principal amount, of the same original
issue date and stated maturity and bearing the same interest rate.
Junior Subordinated Debentures may be presented for exchange as provided
above, and may be presented for registration of transfer (with the form of
transfer endorsed thereon, or a satisfactory written instrument of transfer,
duly executed), at the office of the appropriate securities registrar or at
the office of any transfer agent designated by the Corporation for such
purpose with respect to any series of Junior Subordinated Debentures 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 Junior Subordinated Indenture. The Corporation will appoint the Debenture
Trustee as securities registrar under the Junior Subordinated Indenture. If
the applicable Prospectus Supplement refers to any transfer agents (in
addition to the securities registrar) initially designated by the Corporation
with respect to any series of Junior Subordinated Debentures, 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, provided
that the Corporation maintains a transfer agent in each place of payment for
such series. The Corporation may at any time designate additional transfer
agents with respect to any series of Junior Subordinated Debentures.
In the event of any redemption, neither the Corporation nor the Debenture
Trustee shall be required to (i) issue, register the transfer of or exchange
Junior Subordinated Debentures of any series during the period beginning at
the opening of business 15 days before the day of selection for redemption of
Junior Subordinated Debentures of that series and ending at the close of
business on the day of mailing of the relevant notice of redemption or (ii)
transfer or exchange any Junior Subordinated Debentures so selected for
redemption, except, in the case of any Junior Subordinated Debentures being
redeemed in part, any portion thereof not to be redeemed.
GLOBAL JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures of a series may be issued in whole or in
part in the form of one or more Global Junior Subordinated Debentures (each, a
"Global Junior Subordinated Debenture") that will be
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deposited with, or on behalf of, a depositary identified in the applicable
Prospectus Supplement. Unless otherwise specified in the applicable Prospectus
Supplement, the depositary arrangements relating to the Global Junior
Subordinated Debentures will be substantially the same as those described
under "Description of Preferred Securities--Global Preferred Securities".
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal of (and premium, if any) and any interest on any series of Junior
Subordinated Debentures will be made at the office of the Debenture Trustee in
Wilmington, Delaware, or at the office of such paying agent or paying agents
as the Corporation may designate from time to time with respect to such
series, except that at the option of the Corporation payment of any interest
may be made (i) except in the case of Global Junior Subordinated Debentures,
by check mailed to the address of the person entitled thereto as such address
appears in the securities register relating to such Junior Subordinated
Debentures or (ii) by transfer to an account maintained by the person entitled
thereto as specified in such securities register, provided that proper
transfer instructions have been received by the record date for such payment.
Unless otherwise indicated in the applicable Prospectus Supplement, payment of
any interest on Junior Subordinated Debentures will be made to the person in
whose name such Junior Subordinated Debentures are registered at the close of
business on the Regular Record Date (as defined in the Junior Subordinated
Indenture) for such interest, except in the case of Defaulted Interest (as
defined in the Junior Subordinated Indenture). The Corporation may at any time
designate additional paying agents or rescind the designation of any paying
agent with respect to any series of Junior Subordinated Debentures; however
the Corporation will at all times be required to maintain a paying agent with
respect to any series of Junior Subordinated Debentures in each place of
payment for such series of Junior Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any paying agent, or then
held by the Corporation in trust, for the payment of the principal of (or
premium, if any) or interest on any Junior Subordinated Debenture and
remaining unclaimed for two years after such principal (or premium, if any) or
interest has become due and payable will, at the request of the Corporation,
be repaid to the Corporation and the holder of such Junior Subordinated
Debenture may thereafter look, as a general unsecured creditor, only to the
Corporation for payment thereof.
OPTION TO DEFER INTEREST PAYMENTS
If provided in the applicable Prospectus Supplement, the Corporation will
have the right at any time and from time to time during the term of any series
of Junior Subordinated Debentures to defer payment of interest on such series
of Junior Subordinated Debentures for up to such number of consecutive
interest payment periods as may be specified in such Prospectus Supplement,
subject to the terms, conditions and covenants, if any, specified in such
Prospectus Supplement, provided that such Extension Period may not extend
beyond the Stated Maturity of such series of Junior Subordinated Debentures as
in effect at the time of the Corporation's election to defer interest in this
manner. Certain United States federal income tax consequences and special
considerations applicable to any such Junior Subordinated Debentures will be
described in the applicable Prospectus Supplement.
REDEMPTION
Unless otherwise indicated in the applicable Prospectus Supplement, Junior
Subordinated Debentures will not be subject to any sinking fund.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporation may, at its option, redeem the Junior Subordinated Debentures of
any series in whole at any time or in part from time to time. If the Junior
Subordinated Debentures of any series are so redeemable only on or after a
specified date or upon the satisfaction of additional conditions, the
applicable Prospectus Supplement will specify such date or describe such
conditions. Junior Subordinated Debentures in denominations larger than $1,000
may be redeemed in part
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but only in integral multiples of $1,000. Except as otherwise specified in the
applicable Prospectus Supplement, the redemption price for any Junior
Subordinated Debenture so redeemed shall equal 100% of the principal amount of
such Junior Subordinated Debentures plus accrued and unpaid interest thereon
to the date fixed for redemption.
Except as otherwise specified in the applicable Prospectus Supplement, if a
Tax Event, an Investment Company Event or a Capital Treatment Event (in each
case as defined under "Description of Preferred Securities--Redemption or
Exchange") occurs and is continuing, the Corporation may, at its option,
redeem such series of Junior Subordinated Debentures in whole (but not in
part) at any time within 90 days following the occurrence of such Tax Event,
Investment Company Event or Capital Treatment Event (or, if the approval of
the Federal Reserve (as defined below) is then required for such redemption,
on such later date as promptly as is reasonably practicable after such
approval is obtained), at a redemption price equal to 100% of the principal
amount of such Junior Subordinated Debentures then outstanding plus accrued
and unpaid interest thereon to the date fixed for redemption, except as
otherwise specified in the applicable Prospectus Supplement.
The Corporation has committed to the Board of Governors of the Federal
Reserve System (the "Federal Reserve") not to exercise its rights to redeem
the Junior Subordinated Debentures without having received the prior approval
of the Federal Reserve to do so, if then required under applicable Federal
Reserve capital guidelines or policies.
Notice of any redemption will be mailed at least 45 days but not more than
75 days before the redemption date to each Holder of Junior Subordinated
Debentures to be redeemed at its registered address. Unless the Corporation
defaults in payment of the redemption price, on and after the redemption date
interest shall cease to accrue on such Junior Subordinated Debentures or
portions thereof called for redemption.
RESTRICTIONS ON CERTAIN PAYMENTS
The Corporation will also covenant, as to each series of Junior Subordinated
Debentures, that it will not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect
to, any of the Corporation's capital stock or (ii) make any payment of
principal of or interest or premium, if any, on or repay or repurchase or
redeem any debt securities of the Corporation that rank pari passu in all
respects with or junior in interest to the Junior Subordinated Debentures
(other than (a) repurchases, redemptions or other acquisitions of shares of
capital stock of the Corporation in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of any one
or more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Corporation (or securities convertible
into or exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable event, (b) as a result of any
exchange or conversion of any class or series of the Corporation's capital
stock (or any capital stock of a subsidiary of the Corporation) for any class
or series of the Corporation's capital stock or of any class or series of the
Corporation's indebtedness for any class or series of the Corporation's
capital stock, (c) the purchase of fractional interests in shares of the
Corporation's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any stockholder's rights plan, or
the issuance of rights, stock or other property under any stockholder's rights
plan, or the redemption or repurchase of rights pursuant thereto, or (e) any
dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options
or other rights is the same stock as that on which the dividend is being paid
or ranks pari passu with or junior to such stock), if at such time (i) there
has occurred any event (a) of which the Corporation has actual knowledge that
with the giving of notice or the lapse of time, or both, would constitute a
Debenture Event of Default with respect to the Junior Subordinated Debentures
of such series and (b) in respect of which the Corporation has not taken
reasonable steps to cure, (ii) if such Junior Subordinated Debentures are held
by an Issuer Trust, the Corporation is in default with respect to its payment
of any obligations under the Guarantee relating to the Related Preferred
Securities or (iii) the Corporation has given
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notice of its selection of an Extension Period as provided in the Junior
Subordinated Indenture with respect to the Junior Subordinated Debentures of
such series and has not rescinded such notice, or such Extension Period, or
any extension thereof, is continuing.
MODIFICATION OF JUNIOR SUBORDINATED INDENTURE
From time to time the Corporation and the Debenture Trustee may, without the
consent of the holders of any series of Junior Subordinated Debentures, amend,
waive or supplement the provisions of the Junior Subordinated Indenture for
specified purposes, including, among other things, curing ambiguities, defects
or inconsistencies (provided that any such action does not materially
adversely affect the interests of the holders of any series of Junior
Subordinated Debentures or, in the case of Corresponding Junior Subordinated
Debentures, the holders of the Related Preferred Securities so long as they
remain outstanding) and qualifying, or maintaining the qualification of, the
Junior Subordinated Indenture under the Trust Indenture Act. The Junior
Subordinated Indenture contains provisions permitting the Corporation and the
Debenture Trustee, with the consent of the holders of not less than a majority
in principal amount of each outstanding series of Junior Subordinated
Debentures affected thereby, to modify the Junior Subordinated Indenture in a
manner affecting the rights of the holders of such series of the Junior
Subordinated Debentures, except that no such modification may, without the
consent of the holder of each outstanding Junior Subordinated Debenture so
affected, (i) change the Stated Maturity of any series of Junior Subordinated
Debentures (except as otherwise specified in the applicable Prospectus
Supplement), or reduce the principal amount thereof, the rate of interest
thereon or any premium payable upon the redemption thereof, change the place
of payment where, or the currency in which, any such amount is payable or
impair the right to institute suit for the enforcement of any Junior
Subordinated Debenture or (ii) reduce the percentage of the principal amount
of Junior Subordinated Debentures of any series, the holders of which are
required to consent to any such modification of the Junior Subordinated
Indenture. Furthermore, in the case of Corresponding Junior Subordinated
Debentures, so long as any of the Related Preferred Securities remain
outstanding, (a) no such modification may be made that adversely affects the
holders of such Preferred Securities in any material respect, and no
termination of the Junior Subordinated Indenture may occur, and no waiver of
any event of default or compliance with any covenant under the Junior
Subordinated Indenture in respect of such series of Junior Subordinated
Debentures may be effective, without the prior consent of the holders of at
least a majority in aggregate Liquidation Amount of all the outstanding
Related Preferred Securities unless and until the principal of (and premium,
if any, on) the Corresponding Junior Subordinated Debentures and all accrued
and unpaid interest thereon have been paid in full and certain other
conditions are satisfied and (b) where a consent under the Junior Subordinated
Indenture would require the consent of each holder of Corresponding Junior
Subordinated Debentures, no such consent may be given by the Property Trustee
without the prior consent of each holder of Related Preferred Securities.
In addition, the Corporation and the Debenture Trustee may execute, without
the consent of any holder of Junior Subordinated Debentures, any supplemental
indenture for the purpose of creating any new series of Junior Subordinated
Debentures.
DEBENTURE EVENTS OF DEFAULT
The Junior Subordinated Indenture provides that any one or more of the
following events with respect to a series of Junior Subordinated Debentures
that has occurred and is continuing constitutes an "Event of Default" with
respect to such series of Junior Subordinated Debentures:
(i) failure for 30 days to pay any interest on such series of Junior
Subordinated Debentures when due (subject to the deferral of any due date
in the case of an Extension Period); or
(ii) failure to pay any principal of (or premium, if any) on such series
of Junior Subordinated Debentures when due, whether at maturity or upon
redemption, by declaration, by acceleration or otherwise; or
(iii) failure to observe or perform in any material respect certain other
covenants contained in the Junior Subordinated Indenture for 90 days after
written notice to the Corporation from the Debenture Trustee or
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the holders of at least 25% in aggregate outstanding principal amount of
such affected series of outstanding Junior Subordinated Debentures; or
(iv) certain events of bankruptcy, insolvency or reorganization of the
Corporation.
For purposes of the related Declaration of Trust and this Prospectus, each
such Event of Default under a series of Junior Subordinated Debentures is
referred to as a "Debenture Event of Default" in respect of such series. As
described in "Description of Preferred Securities--Events of Default; Notice",
the occurrence of a Debenture Event of Default in respect of a Series of
Corresponding Junior Subordinated Debentures will also constitute an Event of
Default in respect of the Related Preferred Securities and related Common
Securities.
The holders of at least a majority in aggregate outstanding principal amount
of Junior Subordinated Debentures of each series affected will have the right
to direct the time, method and place of conducting any proceeding for any
remedy available to the Debenture Trustee. The Debenture Trustee or the
holders of not less than 25% in aggregate outstanding principal amount of
Junior Subordinated Debentures of each series affected may declare the
principal (or, if the Preferred Securities of such series are Discount
Securities, such portion of the principal amount as may be specified in the
applicable Prospectus Supplement) due and payable immediately upon a Debenture
Event of Default, and, in the case of Corresponding Junior Subordinated
Debentures, if the Debenture Trustee or such holders of such Corresponding
Junior Subordinated Debentures fail to make such declaration, the holders of
at least 25% in aggregate Liquidation Amount of the outstanding Related
Preferred Securities will have such right. The holders of a majority in
aggregate outstanding principal amount of Junior Subordinated Debentures of
each series affected may annul such declaration and waive the default if all
defaults (other than the non-payment of the principal of such Corresponding
Junior Subordinated Debentures that has become due solely by such
acceleration) have been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Debenture Trustee. In the case of Corresponding Junior
Subordinated Debentures, if the holders of such Corresponding Junior
Subordinated Debentures fail to annul such declaration and waive such default,
the holders of a majority in aggregate Liquidation Amount of the Related
Preferred Securities will have such right.
The holders of at least a majority in aggregate outstanding principal amount
of each series of Junior Subordinated Debentures affected thereby may, on
behalf of the holders of all the Junior Subordinated Debentures of such
series, waive any past default, except a default in the payment of principal
of (or premium, if any) or interest on such series (unless such default has
been cured and a sum sufficient to pay all matured installments of interest
and principal (and premium, if any) due otherwise than by acceleration has
been deposited with the Debenture Trustee) or a default in respect of a
covenant or provision that under the Junior Subordinated Indenture cannot be
modified or amended without the consent of the holder of each outstanding
Junior Subordinated Debenture of such series. See "--Modification of Junior
Subordinated Indenture". In the case of Corresponding Junior Subordinated
Debentures, if the holders of such Corresponding Junior Subordinated
Debentures fail to waive such default, the holders of a majority in aggregate
Liquidation Amount of the Related Preferred Securities will have such right.
The Corporation is required to file annually with the Debenture Trustee a
certificate as to whether or not the Corporation is in compliance with all the
conditions and covenants applicable to it under the Junior Subordinated
Indenture.
If a Debenture Event of Default occurs and is continuing with respect to a
series of Corresponding Junior Subordinated Debentures, the Property Trustee
will have the right to declare the principal of and the interest on such
Corresponding Junior Subordinated Debentures, and any other amounts payable
under the Junior Subordinated Indenture with respect thereto, to be forthwith
due and payable and to enforce its other rights as a creditor with respect to
such Corresponding Junior Subordinated Debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED SECURITIES
If a Debenture Event of Default with respect to a series of Corresponding
Junior Subordinated Debentures has occurred and is continuing and such event
is attributable to the failure of the Corporation to pay any amounts
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payable in respect of such Corresponding Junior Subordinated Debentures on the
date such amounts are otherwise payable, a registered holder of the Related
Preferred Securities may institute a legal proceeding directly against the
Corporation for enforcement of payment to such holder of an amount equal to
the amount payable in respect of such Corresponding Junior Subordinated
Debentures having a principal amount equal to the aggregate Liquidation Amount
of the Related Preferred Securities held by such holder (a "Direct Action").
The Corporation may not amend the Junior Subordinated Indenture to remove the
foregoing right to bring a Direct Action without the prior written consent of
the holders of all of the Preferred Securities. If the right to bring a Direct
Action is removed, the applicable Issuer Trust may become subject to reporting
obligations under the Exchange Act. The Corporation will have the right under
the Junior Subordinated Indenture to set-off against the Corporation's
obligations under any payment made to such holder of Preferred Securities by
the Corporation in connection with a Direct Action.
The holders of the Preferred Securities will not be able to exercise
directly any remedies available to the holders of the Junior Subordinated
Debentures except under the circumstances described in the previous paragraph.
See "Description of Preferred Securities--Events of Default; Notice".
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Junior Subordinated Indenture provides that the Corporation may not
consolidate with or merge into any other person or convey, transfer or lease
its properties and assets substantially as an entirety to any person, and no
person may consolidate with or merge into the Corporation or convey, transfer
or lease its properties and assets substantially as an entirety to the
Corporation, unless (i) if the Corporation consolidates with or merges into
another person or conveys or transfers its properties and assets substantially
as an entirety to any person, the successor person is organized under the laws
of the United States or any state or the District of Columbia, and such
successor person expressly assumes the Corporation's obligations in respect of
the Junior Subordinated Debentures; (ii) immediately after giving effect
thereto, no Debenture Event of Default, and no event which, after notice or
lapse of time or both, would constitute a Debenture Event of Default, has
occurred and is continuing, and (iii) certain other conditions as prescribed
in the Junior Subordinated Indenture are satisfied.
The provisions of the Junior Subordinated Indenture do not afford holders of
the Junior Subordinated Debentures protection in the event of a highly
leveraged or other transaction involving the Corporation that may adversely
affect holders of the Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Junior Subordinated Indenture provides that when, among other things,
all Junior Subordinated Debentures not previously delivered to the Debenture
Trustee for cancellation (i) have become due and payable or (ii) will become
due and payable at their Stated Maturity (as then in effect) within one year,
and the Corporation deposits or causes to be deposited with the Debenture
Trustee funds, in trust, for the purpose and in an amount in the currency or
currencies in which the Junior Subordinated Debentures are payable sufficient
to pay and discharge the entire indebtedness on the Junior Subordinated
Debentures not previously delivered to the Debenture Trustee for cancellation,
for the principal (and premium, if any) and interest to the date of the
deposit or to the Stated Maturity, as the case may be, then the Junior
Subordinated Indenture will cease to be of further effect (except as to the
Corporation's obligations to pay all other sums due pursuant to the Junior
Subordinated Indenture and to provide the officers' certificates and opinions
of counsel described therein), and the Corporation will be deemed to have
satisfied and discharged the Junior Subordinated Indenture.
CONVERSION OR EXCHANGE
If and to the extent indicated in the applicable Prospectus Supplement, the
Junior Subordinated Debentures of any series may be convertible or
exchangeable into Junior Subordinated Debentures of another series or into
Preferred Securities of any series. The specific terms on which Junior
Subordinated Debentures of any series may be so converted or exchanged will be
set forth in the applicable Prospectus Supplement. Such terms may
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include provisions for conversion or exchange, either mandatory, at the option
of the holder, or at the option of the Corporation, in which case the
principal amount of Junior Subordinated Debentures or number of shares of
Preferred Securities to be received by the holders of Junior Subordinated
Debentures would be calculated as of a time and in the manner stated in the
applicable Prospectus Supplement.
SUBORDINATION
The Junior Subordinated Debentures will be subordinate and junior in right
of payment, to the extent set forth in the Junior Subordinated Indenture, to
all Senior Indebtedness (as defined below) of the Corporation. If the
Corporation defaults in the payment of any principal, premium, if any, or
interest, if any, or any other amount payable on any Senior Indebtedness when
the same becomes due and payable, whether at maturity or at a date fixed for
redemption or by declaration of acceleration or otherwise, then, unless and
until such default has been cured or waived or has ceased to exist or all
Senior Indebtedness has been paid, no direct or indirect payment (in cash,
property, securities, by set-off or otherwise) may be made or agreed to be
made on the Junior Subordinated Debentures, or in respect of any redemption,
repayment, retirement, purchase or other acquisition of any of the Junior
Subordinated Debentures.
As used herein, "Senior Indebtedness" means any obligation of the
Corporation to its creditors, whether now outstanding or subsequently
incurred, other than any obligation as to which, in the instrument creating or
evidencing the obligation or pursuant to which the obligation is outstanding,
it is provided that such obligation is not Senior Indebtedness, but does not
include trade accounts payable and accrued liabilities arising in the ordinary
course of business. Senior Indebtedness includes the Corporation's outstanding
subordinated debt securities and any subordinated debt securities issued in
the future with substantially similar subordination terms, but does not
include the Junior Subordinated Debentures of any series or any junior
subordinated debt securities issued in the future with subordination terms
substantially similar to those of the Junior Subordinated Debentures.
Substantially all of the existing indebtedness of the Corporation constitutes
Senior Indebtedness.
In the event of (i) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceeding relating
to the Corporation, its creditors or its property, (ii) any proceeding for the
liquidation, dissolution or other winding up of the Corporation, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings,
(iii) any assignment by the Corporation for the benefit of creditors or (iv)
any other marshalling of the assets of the Corporation, all Senior
Indebtedness (including any interest thereon accruing after the commencement
of any such proceedings) shall first be paid in full before any payment or
distribution, whether in cash, securities or other property, shall be made on
account of the Junior Subordinated Debentures. In such event, any payment or
distribution on account of the Junior Subordinated Debentures, whether in
cash, securities or other property, that would otherwise (but for the
subordination provisions) be payable or deliverable in respect of the Junior
Subordinated Debentures will be paid or delivered directly to the holders of
Senior Indebtedness in accordance with the priorities then existing among such
holders until all Senior Indebtedness (including any interest thereon accruing
after the commencement of any such proceedings) has been paid in full.
In the event of any such proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness, the holders of Junior Subordinated
Debentures, together with the holders of any obligations of the Corporation
ranking on a parity with the Junior Subordinated Debentures, will be entitled
to be paid from the remaining assets of the Corporation the amounts at the
time due and owing on the Junior Subordinated Debentures and such other
obligations before any payment or other distribution, whether in cash,
property or otherwise, will be made on account of any capital stock or
obligations of the Corporation ranking junior to the Junior Subordinated
Debentures and such other obligations. If any payment or distribution on
account of the Junior Subordinated Debentures of any character or any
security, whether in cash, securities or other property is received by any
holder of any Junior Subordinated Debentures in contravention of any of the
terms hereof and before all the Senior Indebtedness has been paid in full,
such payment or distribution or security will be received in trust for the
benefit of, and must be paid over or delivered and transferred to, the holders
of the Senior Indebtedness at the time outstanding in accordance with the
priorities then existing among such holders for
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application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all such Senior Indebtedness in full. By reason of
such subordination, in the event of the insolvency of the Corporation, holders
of Senior Indebtedness may receive more, ratably, and holders of the Junior
Subordinated Debentures may receive less, ratably, than the other creditors of
the Corporation. Such subordination will not prevent the occurrence of any
Debenture Event of Default.
The Junior Subordinated Indenture places no limitation on the amount of
additional Senior Indebtedness that may be incurred by the Corporation. The
Corporation expects from time to time to incur additional indebtedness
constituting Senior Indebtedness.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The duties of the Debenture Trustee will be subject to limitations and
qualifications substantially similar to those described with respect to the
Property Trustee under "Description of Preferred Securities--Information
Concerning the Property Trustee".
For information concerning the relationships between Wilmington Trust
Company, the Debenture Trustee, and the Corporation, see "Description of
Preferred Securities--Information Concerning the Property Trustee".
GOVERNING LAW
The Junior Subordinated Indenture and the Junior Subordinated Debentures
will be governed by and construed in accordance with the laws of the State of
New York.
CORRESPONDING JUNIOR SUBORDINATED DEBENTURES
The Corresponding Junior Subordinated Debentures may be issued in one or
more series of Junior Subordinated Debentures under the Junior Subordinated
Indenture in connection with the issuance of a series of Related Preferred
Securities by an Issuer Trust. In that event, concurrently with the issuance
of such Issuer Trust's Preferred Securities, such Issuer Trust will invest the
proceeds thereof and the consideration paid by the Corporation for the Common
Securities of such Issuer Trust in such series of Corresponding Junior
Subordinated Debentures, which will be issued by the Corporation to such
Issuer Trust. Each series of Corresponding Junior Subordinated Debentures will
be in a principal amount equal to the aggregate stated Liquidation Amount of
the Related Preferred Securities and the Common Securities of such Issuer
Trust. Holders of the Related Preferred Securities for a series of
Corresponding Junior Subordinated Debentures will have the rights in
connection with modifications to the Junior Subordinated Indenture or upon
occurrence of Debenture Events of Default, as described under "--Modification
of Junior Subordinated Indenture" and "--Debenture Events of Default", unless
provided otherwise in the applicable Prospectus Supplement.
Unless otherwise specified in the applicable Prospectus Supplement, if a Tax
Event, Investment Company Event or Capital Treatment Event in respect of an
Issuer Trust occurs and is continuing, the Corporation may, at its option,
redeem the Corresponding Junior Subordinated Debentures at any time within 90
days of the occurrence of such event (or, if the approval of the Federal
Reserve is then required for such redemption, on such later date as promptly
as is reasonably practicable after such approval is obtained), in whole but
not in part, subject to the provisions of the Junior Subordinated Indenture
and whether or not such Corresponding Junior Subordinated Debentures are then
otherwise redeemable at the option of the Corporation. The Corporation has
committed to the Federal Reserve not to exercise its right to redeem the
Junior Subordinated Debentures without having received the prior approval of
the Federal Reserve to do so, if then required under applicable Federal
Reserve capital guidelines or policies. The redemption price for any
Corresponding Junior Subordinated Debentures shall be equal to 100% of the
principal amount of such Corresponding Junior Subordinated Debentures then
outstanding plus accrued and unpaid interest to the date fixed for redemption.
For so long as the applicable Issuer Trust is the holder of all the
outstanding Corresponding Junior Subordinated Debentures initially issued to
such Issuer Trust, the proceeds of any such redemption will be used by the
Issuer Trust to
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redeem the corresponding Trust Securities in accordance with their terms. The
Corporation may not redeem a series of Corresponding Junior Subordinated
Debentures in part unless all accrued and unpaid interest has been paid in
full on all outstanding Corresponding Junior Subordinated Debentures of such
series for all interest periods terminating on or prior to the redemption
date.
The Corporation will covenant in the Junior Subordinated Indenture, as to
each series of Corresponding Junior Subordinated Debentures, that if and so
long as (i) the Issuer Trust that issued the Related Preferred Securities is
the holder of all such Corresponding Junior Subordinated Debentures, (ii) a
Tax Event in respect of such Issuer Trust has occurred and is continuing and
(iii) the Corporation has elected, and has not revoked such election, to pay
Additional Sums (as defined under "Description of Preferred Securities--
Redemption or Exchange") in respect of such Trust Securities, the Corporation
will pay to such Issuer Trust such Additional Sums. The Corporation will also
covenant, as to each series of Corresponding Junior Subordinated Debentures,
(i) to continue to hold, directly or indirectly, 100% of the Common Securities
of the Issuer Trust to which such Corresponding Junior Subordinated Debentures
have been issued, provided that certain successors that are permitted pursuant
to the Junior Subordinated Indenture may succeed to the Corporation's
ownership of the Common Securities, (ii) as holder of all the Common
Securities not to voluntarily dissolve, terminate, wind-up or liquidate any
Issuer Trust, other than (a) in connection with a distribution of
Corresponding Junior Subordinated Debentures to the holders of the Preferred
Securities in liquidation of such Issuer Trust or (b) in connection with
certain mergers, consolidations or amalgamations permitted by the related
Declaration of Trust and (iii) to use its reasonable efforts, consistent with
the terms and provisions of the related Declaration of Trust, to cause such
Issuer Trust to continue not to be taxable as a corporation and to be taxable
as a grantor trust for United States federal income tax purposes. In addition,
the Corporation has committed to the Federal Reserve that, so long as the
Corporation (or an affiliate) is the holder of the Common Securities, the
Corporation (or such affiliate) will not voluntarily dissolve, wind-up or
liquidate any Issuer Trust without the prior approval of the Federal Reserve,
if then required under applicable Federal Reserve capital guidelines or
policies.
DESCRIPTION OF GUARANTEES
A Guarantee will be executed and delivered by the Corporation concurrently
with the issuance by each Issuer Trust of its Preferred Securities for the
benefit of the holders from time to time of such Preferred Securities.
Wilmington Trust Company will act as indenture trustee ("Guarantee Trustee")
under each Guarantee for the purposes of compliance with the Trust Indenture
Act, and each Guarantee will be qualified as an indenture under the Trust
Indenture Act. This summary of certain provisions of the Guarantees does not
purport to be complete and is subject to, and qualified in its entirety by
reference to, all of the provisions of each Guarantee, including the
definitions therein of certain terms, and the Trust Indenture Act, to each of
which reference is hereby made. The form of the Guarantee has been filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.
Reference in this summary to Preferred Securities means the series of
Preferred Securities to which a Guarantee relates. The Guarantee Trustee will
hold the related Guarantee for the benefit of the holders of the Related
Preferred Securities.
GENERAL
The Corporation will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined
below) to the holders of the Related Preferred Securities, as and when due,
regardless of any defense, right of set-off or counterclaim that such Issuer
Trust may have or assert other than the defense of payment. The following
payments with respect to the Related Preferred Securities, to the extent not
paid by or on behalf of the related Issuer Trust (the "Guarantee Payments"),
will be subject to the Guarantee: (i) any accumulated and unpaid Distributions
required to be paid on such Related Preferred Securities, to the extent that
such Issuer Trust has funds on hand available therefor at such time, (ii) the
Redemption Price with respect to any Related Preferred Securities called for
redemption, to the extent that such Issuer Trust has funds on hand available
therefor at such time, and (iii) upon a voluntary or involuntary dissolution,
winding-up or liquidation of such Issuer Trust (unless the Corresponding
Junior Subordinated Debentures are distributed to
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holders of such Related Preferred Securities), the lesser of (a) the
Liquidation Distribution, to the extent that the Issuer Trust has funds on
hand available therefor at such time, and (b) the amount of assets of such
Issuer Trust remaining available for distribution to holders of such Related
Preferred Securities on liquidation of such Issuer Trust after satisfaction of
liabilities to creditors of such Issuer Trust as required by applicable law.
The Corporation's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by the Corporation to the holders of
the Related Preferred Securities or by causing the related Issuer Trust to pay
such amounts to such holders.
Each Guarantee will be an irrevocable guarantee on a subordinated basis of
the related Issuer Trust's obligations under the Related Preferred Securities,
but will apply only to the extent that such Issuer Trust has funds sufficient
to make such payments, and is not a guarantee of collection.
If the Corporation does not make payments on the Corresponding Junior
Subordinated Debentures held by any Issuer Trust, the Issuer Trust will not be
able to pay any amounts payable in respect of the Preferred Securities and
will not have funds legally available therefor. Each Guarantee will rank
subordinate and junior in right of payment to all Senior Indebtedness of the
Corporation. See "--Status of the Guarantees". Because the Corporation is a
holding company, the right of the Corporation to participate in any
distribution of assets of any subsidiary upon such subsidiary's dissolution,
winding-up, liquidation or reorganization or otherwise is 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. There are also various legal limitations on the extent to which
certain of the Corporation's subsidiaries may extend credit, pay dividends or
otherwise supply funds to the Corporation or certain of its other
subsidiaries. Accordingly, the Corporation's obligations under the Guarantees
will be effectively subordinated and junior in right of payment to all
existing and future liabilities of the Corporation's subsidiaries, and
claimants under the Guarantees should look only to the assets of the
Corporation for payments thereunder. See "Bankers Trust New York Corporation".
Except as otherwise provided in the applicable Prospectus Supplement, the
Guarantees will not limit the incurrence or issuance of other secured or
unsecured debt of the Corporation, including Senior Indebtedness, whether
under the Junior Subordinated Indenture, any other existing indenture or any
other indenture that the Corporation may enter into in the future or
otherwise.
The Corporation has, through the applicable Guarantee, the applicable
Declaration of Trust, the applicable series of Corresponding Junior
Subordinated Debentures, the Junior Subordinated Indenture and the applicable
Expense Agreement, taken together, fully, irrevocably and unconditionally
guaranteed all of the Issuer Trust's obligations under the Preferred
Securities. No single document standing alone or operating in conjunction with
fewer than all of the other documents constitutes such guarantee. It is only
the combined operation of these documents that has the effect of providing a
full, irrevocable and unconditional guarantee of the Issuer Trust's
obligations in respect of the Preferred Securities. See "Relationship Among
the Preferred Securities, the Corresponding Junior Subordinated Debentures,
the Guarantees and the Expense Agreements".
STATUS OF THE GUARANTEES
Each Guarantee will constitute an unsecured obligation of the Corporation
and will rank subordinate and junior in right of payment to all Senior
Indebtedness of the Corporation in the same manner as the Junior Subordinated
Debentures. Each Guarantee will rank pari passu with all of the other
Guarantees.
Each Guarantee will constitute a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Corporation to enforce its rights under such Guarantee without first
instituting a legal proceeding against any other person or entity). Each
Guarantee will be held by the related Guarantee Trustee for the benefit of the
holders of the related Preferred Securities. Each Guarantee will not be
discharged except by payment of the related Guarantee Payments in full to the
extent not paid by the related Issuer Trust or upon distribution of the
Corresponding Junior Subordinated Debentures to the holders of the Preferred
Securities.
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AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely affect
the rights of holders of the Related Preferred Securities (in which case no
vote will be required), no Guarantee may be amended without the prior approval
of the holders of not less than a majority in aggregate Liquidation Amount of
such outstanding
Preferred Securities. The manner of obtaining any such approval will be as set
forth under "Description of Preferred Securities--Voting Rights; Amendment of
Each Declaration of Trust". All guarantees and agreements contained in each
Guarantee will bind the successors, assigns, receivers, trustees and
representatives of the Corporation and will inure to the benefit of the
holders of the Related Preferred Securities then outstanding.
EVENTS OF DEFAULT
An event of default under each Guarantee will occur upon the failure of the
Corporation to perform any of its payment obligations thereunder, or to
perform any non-payment obligation if such non-payment default remains
unremedied for 30 days after notice to the Corporation. The holders of not
less than a majority in aggregate Liquidation Amount of the outstanding
Related Preferred Securities have the right to direct the time, method and
place of conducting any proceeding for any remedy available to such Guarantee
Trustee in respect of such Guarantee or to direct the exercise of any trust or
power conferred upon such Guarantee Trustee under such Guarantee.
Any registered holder of Preferred Securities may institute a legal
proceeding directly against the Corporation to enforce its rights under the
related Guarantee without first instituting a legal proceeding against the
related Issuer Trust, the related Guarantee Trustee or any other person or
entity.
The Corporation, as guarantor, is required to file annually with each
Guarantee Trustee a certificate as to whether or not the Corporation is in
compliance with all the conditions and covenants applicable to it under the
related Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The duties of each Guarantee Trustee will be subject to limitations and
qualifications substantially similar to those described with respect to the
Property Trustee under "Description of Preferred Securities--Information
Concerning the Property Trustee".
For information concerning the relationships between Wilmington Trust
Company, the Guarantee Trustee, and the Corporation, see "Description of
Preferred Securities--Information Concerning the Property Trustee".
TERMINATION OF THE GUARANTEES
Each Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of the Related Preferred Securities, upon
full payment of the amounts payable with respect to the Related Preferred
Securities upon liquidation of the related Issuer Trust or upon distribution
of the Corresponding Junior Subordinated Debentures to the holders of the
Related Preferred Securities. Each Guarantee will continue to be effective or
will be reinstated, as the case may be, if at any time any holder of the
Related Preferred Securities must restore payment of any sums paid under such
Related Preferred Securities or such Guarantee.
GOVERNING LAW
Each Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
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DESCRIPTION OF EXPENSE AGREEMENTS
Pursuant to the Agreement as to Expenses and Liabilities entered into by the
Corporation under each Declaration of Trust (the "Expense Agreement"), the
Corporation will, as Depositor, irrevocably and unconditionally guarantee to
each person or entity to whom the Issuer Trust becomes indebted or liable, the
full payment of any costs, expenses or liabilities of the Issuer Trust, other
than obligations of the Issuer Trust to pay to the holders of its Trust
Securities the amounts distributable to such holders pursuant to the terms of
such Trust Securities. Each Expense Agreement will constitute an unsecured
obligation of the Corporation and will rank subordinate and junior in right of
payment to all Senior Indebtedness of the Corporation in the same manner as
the Guarantees and the Junior Subordinated Debentures.
RELATIONSHIP AMONG THE PREFERRED SECURITIES, THE CORRESPONDING JUNIOR
SUBORDINATED DEBENTURES, THE GUARANTEES AND THE EXPENSE AGREEMENTS
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Preferred Securities
of any Issuer Trust (to the extent such Issuer Trust has funds available for
such payment) are irrevocably guaranteed by the Corporation as and to the
extent set forth under "Description of Guarantees". Taken together, the
Corporation's obligations under each series of Corresponding Junior
Subordinated Debentures, the Junior Subordinated Indenture, the related
Declaration of Trust, the related Expense Agreement and the related Guarantee
provide, in the aggregate, a full, irrevocable and unconditional guarantee of
payments of Distributions and other amounts due on the Related Preferred
Securities. No single document standing alone or operating in conjunction with
fewer than all of the other documents constitutes such guarantee. It is only
the combined operation of these documents that has the effect of providing a
full, irrevocable and unconditional guarantee of such Issuer Trust's
obligations in respect of the Related Preferred Securities. If and to the
extent that the Corporation does not make payments on the Corresponding Junior
Subordinated Debentures held by any Issuer Trust, such Issuer Trust will not
have sufficient funds to pay Distributions or other amounts due on its Related
Preferred Securities. The Guarantees do not cover payment of amounts payable
with respect to an Issuer Trust's Preferred Securities when such Issuer Trust
does not have sufficient funds to pay such amounts. In such event, the remedy
of a holder of Preferred Securities is to institute a legal proceeding
directly against the Corporation for enforcement of payment of the
Corporation's obligations under Corresponding Junior Subordinated Debentures
having a principal amount equal to the Liquidation Amount of the Preferred
Securities held by such holder.
The obligations of the Corporation under the Junior Subordinated Debentures,
each Guarantee and each Expense Agreement are subordinate and junior in right
of payment to all Senior Indebtedness.
SUFFICIENCY OF PAYMENTS
As long as payments are made when due on each series of Corresponding Junior
Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments distributable on the Related Preferred
Securities, primarily because (i) the aggregate principal amount of each
series of Corresponding Junior Subordinated Debentures will be equal to the
sum of the aggregate stated Liquidation Amount of the Related Preferred
Securities and related Common Securities; (ii) the interest rate and interest
and other payment dates on each series of Corresponding Junior Subordinated
Debentures will match the Distribution rate, Distribution Dates and other
payment dates for the Related Preferred Securities; (iii) the Corporation will
pay for all and any costs, expenses and liabilities of each Issuer Trust
except such Issuer Trust's obligations to holders of its Trust Securities; and
(iv) each Declaration of Trust further provides that the Issuer Trust will not
engage in any activity that is not consistent with the limited purposes of
such Issuer Trust.
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Notwithstanding anything to the contrary in the Junior Subordinated
Indenture, the Corporation has the right to set off any payment it is
otherwise required to make thereunder against and to the extent the
Corporation has theretofore made, or is concurrently on the date of such
payment making, a payment under the related Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF PREFERRED SECURITIES
A holder of any Preferred Security may institute a legal proceeding directly
against the Corporation to enforce its rights under the related Guarantee
without first instituting a legal proceeding against the Guarantee Trustee,
the related Issuer Trust or any other person or entity. See "Description of
Guarantee".
A default or event of default under any Senior Indebtedness of the
Corporation would not constitute a default or Event of Default in respect of
the Preferred Securities. However, in the event of payment defaults under, or
acceleration of, Senior Indebtedness of the Corporation, the subordination
provisions of the Junior Subordinated Indenture provide that no payments may
be made in respect of any Junior Subordinated Debentures until such Senior
Indebtedness has been paid in full or any payment default thereunder has been
cured or waived. See "Description of Junior Subordinated Debentures--
Subordination." Failure to make required payments on any series of
Corresponding Junior Subordinated Debentures would constitute an Event of
Default with respect to such series under the Junior Subordinated Indenture.
LIMITED PURPOSE OF ISSUER TRUSTS
Each Issuer Trust's Preferred Securities represent preferred undivided
beneficial interests in the assets of such Issuer Trust, and each Issuer Trust
exists for the sole purpose of issuing its Preferred Securities and Common
Securities, investing the proceeds thereof in Corresponding Junior
Subordinated Debentures and engaging in only those other activities necessary
or incidental thereto. A principal difference between the rights of a holder
of a Preferred Security and a holder of a Corresponding Junior Subordinated
Debenture is that a holder of a Corresponding Junior Subordinated Debenture is
entitled to receive from the Corporation payments on Corresponding Junior
Subordinated Debentures held, while a holder of Preferred Securities is
entitled to receive Distributions or other amounts distributable with respect
to the Preferred Securities from such Issuer Trust (or from the Corporation
under the related Guarantee) only if and to the extent such Issuer Trust has
funds available for the payment of such Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary dissolution, winding-up or liquidation of
any Issuer Trust, other than any such dissolution, winding-up or liquidation
involving the distribution of the Corresponding Junior Subordinated
Debentures, after satisfaction of liabilities to creditors of the Issuer Trust
as required by applicable law, the holders of the Related Preferred Securities
will be entitled to receive, out of the assets held by such Issuer Trust, the
Liquidation Distribution in cash. See "Description of Preferred Securities--
Liquidation Distribution Upon Dissolution". Upon any voluntary or involuntary
liquidation or bankruptcy of the Corporation, the Property Trustee, as the
holder of the Corresponding Junior Subordinated Debentures, would be a
subordinated creditor of the Corporation, subordinated and junior in right of
payment to all Senior Indebtedness as set forth in the Junior Subordinated
Indenture, but entitled to receive payment in full of all amounts payable with
respect to the Corresponding Junior Subordinated Debentures, before any
stockholders of the Corporation receive payments or distributions. Since the
Corporation is the guarantor under each Guarantee and has agreed under the
related Expense Agreement to pay for all costs, expenses and liabilities of
each Issuer Trust (other than such Issuer Trust's obligations to the holders
of its Trust Securities), the positions of a holder of the Preferred
Securities and a holder of such Corresponding Junior Subordinated Debentures
relative to other creditors and to stockholders of the Corporation in the
event of liquidation or bankruptcy of the Corporation are expected to be
substantially the same.
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PLAN OF DISTRIBUTION
The Preferred Securities or Junior Subordinated Debentures may be sold in a
public offering to or through underwriters or dealers designated from time to
time. The Corporation and each Issuer Trust may sell its Preferred Securities
or Junior Subordinated Debentures as soon as practicable after effectiveness
of the Registration Statement of which this Prospectus forms a part. The names
of any underwriters or dealers involved in the sale of the Preferred
Securities or Junior Subordinated Debentures in respect of which this
Prospectus is delivered, the amount or number of Preferred Securities and
Junior Subordinated Debentures to be purchased by any such underwriters and
any applicable commissions or discounts will be set forth in the applicable
Prospectus Supplement.
Underwriters may offer and sell Preferred Securities or Junior Subordinated
Debentures 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. In connection with the
sale of Preferred Securities or Junior Subordinated Debentures, underwriters
may be deemed to have received compensation from the Corporation and/or the
applicable Issuer Trust in the form of underwriting discounts or commissions
and may also receive commissions. Underwriters may sell Preferred Securities
or Junior Subordinated Debentures to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters.
Any underwriting compensation paid by the Corporation and/or the applicable
Issuer Trust to underwriters in connection with the offering of Preferred
Securities or Junior Subordinated Debentures, and any discounts, concessions
or commissions allowed by such underwriters to participating dealers, will be
described in the applicable Prospectus Supplement. Underwriters and dealers
participating in the distribution of Preferred Securities or Junior
Subordinated Debentures may be deemed to be underwriters, and any discounts
and commissions received by them and any profit realized by them on resale of
such Preferred Securities or Junior Subordinated Debentures may be deemed to
be underwriting discounts and commissions, under the Securities Act.
Underwriters and dealers may be entitled, under agreement with the Corporation
and the applicable Issuer Trust, to indemnification against and contribution
toward certain civil liabilities, including liabilities under the Securities
Act, and to reimbursement by the Corporation or the applicable Issuer Trust
for certain expenses.
In connection with the offering of the Preferred Securities of any Issuer
Trust, such Issuer Trust may grant to the underwriters an option to purchase
additional Preferred Securities to cover over-allotments, if any, at the
initial public offering price (with an additional underwriting commission), as
may be set forth in the applicable Prospectus Supplement. If such Issuer Trust
grants any over-allotment option, the terms of such over-allotment option will
be set forth in the applicable Prospectus Supplement.
Underwriters and dealers may engage in transactions with, or perform
services for, the Corporation and/or the applicable Issuer Trust and/or any of
their affiliates in the ordinary course of business.
The Preferred Securities and the Junior Subordinated Debentures will be new
issues of securities and will have no established trading market. Any
underwriters to whom Preferred Securities or Junior Subordinated Debentures
are sold for public offering and sale may make a market in such Preferred
Securities and Junior Subordinated Debentures, but such underwriters will not
be obligated to do so and may discontinue any market making at any time
without notice. Such Preferred Securities or Junior Subordinated Debentures
may or may not be listed on a national securities exchange or the NASDAQ
National Market System. No assurance can be given as to the liquidity of or
the existence of trading markets for any Preferred Securities or Junior
Subordinated Debentures.
BT Securities Corporation ("BT Securities"), which is a member of the
National Association of Securities Dealers, Inc. (the "NASD"), a wholly owned
subsidiary of the Corporation and an affiliate of the Issuer Trusts, may
participate in the distributions of the Preferred Securities or Junior
Subordinated Debentures. The offer and sale of the Preferred Securities or
Junior Subordinated Debentures will conform with the requirements set forth in
Rule 2720 of the Conduct Rules of the NASD.
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Any market making activities of BT Securities with respect to the Junior
Subordinated Debentures or Preferred Securities will be conducted in
compliance with the requirements of Rule 2720 of the Conduct Rules of the
NASD. Following the initial distribution of any Junior Subordinated Debentures
or Preferred Securities, BT Securities and other affiliates of the Corporation
may offer and sell such Junior Subordinated Debentures or Preferred Securities
in the course of their business as broker-dealers. BT Securities and such
other affiliates may act as principals or agents in such transactions. This
Prospectus may be used by BT Securities and such other affiliates in
connection with such transactions. Such sales, if any, will be made at varying
prices relating to prevailing market prices at the time of sale or otherwise.
Neither BT Securities nor such other affiliates are obligated to make a market
in any of the Junior Subordinated Debentures or Preferred Securities and may
discontinue any market-making activities at any time without notice.
VALIDITY OF SECURITIES
Unless otherwise indicated in the applicable Prospectus Supplement, the
validity of the Preferred Securities, the enforceability of the Declarations
of Trust and the creation of the Issuer Trusts will be passed upon by
Richards, Layton & Finger, One Rodney Square, Wilmington, Delaware 19801,
special Delaware counsel to the Corporation and the Issuer Trusts. Unless
otherwise indicated in the applicable Prospectus Supplement, the validity of
the Guarantees and the Junior Subordinated Debentures will be passed upon for
the Corporation by Sullivan & Cromwell, 125 Broad Street, New York, New York
10004, and for the underwriters by White & Case, 1155 Avenue of the Americas,
New York, New York 10036. Certain matters relating to United States federal
income tax considerations will be passed upon for the Corporation by Sullivan
& Cromwell, as counsel for the Corporation.White & Case performs legal
services for the Corporation from time to time. Richards, Layton & Finger is
also serving as counsel to Wilmington Trust Company, in its various
capacities, in connection with the issuance of the Preferred Securities.
Richards, Layton & Finger performs other services for the Corporation and
Wilmington Trust Company from time to time.
EXPERTS
The consolidated financial statements of the Corporation and subsidiaries
for the year ended December 31, 1995, appearing in the Corporation's Annual
Report on Form 10-K for the year ended December 31, 1995, and incorporated by
reference into this Prospectus, 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.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESEN-
TATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS PRO-
SPECTUS SUPPLEMENT OR THE PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMA-
TION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY
THE CORPORATION OR THE ISSUER TRUST OR BY THE UNDERWRITERS. NEITHER THE DELIV-
ERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY SALE MADE HEREUN-
DER AND THEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION OR THE ISSUER TRUST
SINCE THE DATE HEREOF. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OF-
FER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAW-
FUL TO MAKE SUCH OFFER OR SOLICITATION.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Summary .................................................................. S-4
Risk Factors.............................................................. S-7
Bankers Trust New York Corporation........................................ S-12
Selected Consolidated Financial Data and Other Information................ S-13
BT Preferred Capital Trust I.............................................. S-14
Use of Proceeds........................................................... S-14
Accounting Treatment...................................................... S-14
Capitalization............................................................ S-16
Certain Terms of Preferred Securities..................................... S-17
Certain Terms of Junior Subordinated Debentures........................... S-20
Certain Terms of Guarantee................................................ S-25
Certain Federal Income Tax Consequences................................... S-26
Certain ERISA Considerations.............................................. S-30
Underwriting.............................................................. S-31
PROSPECTUS
Available Information..................................................... 4
Incorporation of Certain Documents by Reference........................... 4
Bankers Trust New York Corporation........................................ 6
The Issuer Trusts......................................................... 7
Use of Proceeds........................................................... 8
Description of Preferred Securities....................................... 8
Description of Junior Subordinated Debentures............................. 21
Description of Guarantees................................................. 31
Description of Expense Agreements......................................... 34
Relationship Among the Preferred Securities, the Corresponding Junior
Subordinated Debentures, the Guarantees and the Expense Agreements....... 34
Plan of Distribution...................................................... 36
Validity of Securities.................................................... 37
Experts................................................................... 37
</TABLE>
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$200,000,000
BT PREFERRED CAPITAL TRUST I
% PREFERRED SECURITIES, SERIES I
FULLY AND UNCONDITIONALLY GUARANTEED,
AS DESCRIBED HEREIN, BY
[LOGO] BANKERS TRUST NEW
YORK CORPORATION
-----------
PROSPECTUS SUPPLEMENT
-----------
SMITH BARNEY INC.
MERRILL LYNCH & CO.
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
DEAN WITTER REYNOLDS INC.
AG EDWARDS & SONS, INC.
GOLDMAN, SACHS & CO.
, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION ISSUE DATE: JANUARY 31, 1997
PROSPECTUS
$580,000,000
[LOGO] BANKERS TRUST NEW YORK CORPORATION
DEBT SECURITIES
Bankers Trust New York Corporation (the "Corporation") may offer from time to
time up to $580,000,000 aggregate principal amount, or its equivalent (based on
the applicable exchange rate at the time of offering) in such foreign
currencies, or units of two or more thereof, as may be designated by the
Corporation at the time of offering, of one or more series of debt securities
(the "Debt Securities"). If Debt Securities are issued at an original issue
discount, the Corporation may issue such higher principal amount as may be sold
for an initial public offering price of up to $580,000,000, or its equivalent
(based on the applicable exchange rate at the time of offering) in such foreign
currencies, or units of two or more thereof, as may be designated by the
Corporation at the time of offering. The Debt Securities may be senior debt
securities (the "Senior Debt Securities") or subordinated debt securities (the
"Subordinated Debt Securities"). Debt Securities will be offered on terms to be
determined at the time of offering. The specific title, the aggregate principal
amount, the purchase price, the maturity, the rate and time of payment of any
interest, any redemption provisions, any terms of conversion or exchange and
any other specific terms of the Debt Securities in respect of which this
Prospectus is being delivered (the "Offered Securities") are set forth in the
applicable supplement to this Prospectus (the "Prospectus Supplement").
The Offered Securities 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 and 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--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.
-----------
Following the initial distribution of any Offered Securities, BT Securities
Corporation ("BT Securities") and other affiliates of the Corporation may offer
and sell such securities in the course of their business as broker-dealers. BT
Securities and such other affiliates may act as principal or agent in such
transactions. This Prospectus and the applicable Prospectus Supplement may be
used by BT Securities and such other affiliates in connection with such
transactions. Such sales, if any, will be made at varying prices related to
prevailing market prices at the time of sale.
The date of this Prospectus is , 1997.
<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 APPLICABLE 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.,
Room 1024, 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 (Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511). Copies of such material can also be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. The Commission also maintains a
site on the World Wide Web, the address of which is http://www.sec.gov, that
contains reports, proxy statements and other information regarding issuers,
such as the Corporation, that file electronically with the Commission. In
addition, such material can be inspected at the office of the New York Stock
Exchange, Inc. and the office of the American Stock Exchange, Inc. 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 forms a part (the "Registration Statement"), which 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, 1995, filed pursuant to Section 13 of the
Exchange Act;
(b) The Corporation's Quarterly Reports on Form 10-Q (file number 1-5920)
for the quarters ended March 31, June 30 and September 30, 1996, filed
pursuant to Section 13 of the Exchange Act; and
(c) The Corporation's Current Reports on Form 8-K (file number 1-5920)
dated March 19, April 15, April 25, May 3, May 22, June 18, July 18, July
22, July 26, August 1, October 3, October 17, October 22, November 19 and
December 9, 1996 and January 23, 1997, 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 any offering of the securities offered hereby
shall be deemed to be incorporated by reference into this Prospectus and to be
a part hereof from the date of filing of such documents. Any statement
contained 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, 130 Liberty Street, New York, New York, 10006. Telephone requests
may be directed to (212) 250-2201.
---------------
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 APPLICABLE PROSPECTUS SUPPLEMENT, IN CONNECTION WITH THE
OFFERING CONTAINED HEREIN, 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 SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT INFORMATION HEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO THE DATE THEREOF OR, IN THE CASE OF INFORMATION
INCORPORATED HEREIN BY REFERENCE, THE DATE OF FILING WITH THE COMMISSION.
2
<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
December 31, 1996, the Corporation had consolidated total assets of $120.2
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 Investment Banking, Risk
Management Services, Trading & Sales, Investment Management, Client Processing
Services, Asia, Latin America, Australia/New Zealand and Corporate. Among the
institutional market segments served are corporations, banks, other financial
institutions, governments and agencies, retirement plans, not-for-profit
organizations, wealthy individuals, foundations and private companies. 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 certain of the Corporation's 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 short-term borrowings and accounts payable.
The Corporation's principal executive offices are located at 130 Liberty
Street, New York, New York 10006 and its telephone number is (212) 250-2500.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------
1992 1993 1994 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Excluding Interest on Deposits...................... 1.44 1.71 1.28 1.08 1.20
Including Interest on Deposits...................... 1.28 1.48 1.21 1.06 1.15
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income 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.
3
<PAGE>
USE OF PROCEEDS
Unless otherwise indicated in the applicable 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 applicable Prospectus
Supplement, specific allocations of the proceeds to such purposes have not
been made, although management will have determined at the date of the
applicable 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. 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 "Subordinated
Indenture"), between the Corporation and Marine Midland Bank, as Trustee (the
"Subordinated Trustee"). The Senior Indenture and the Subordinated Indenture
are sometimes referred to collectively as the "Indentures," and the Senior
Trustee and the Subordinated Trustee 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 applicable
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 of
which this Prospectus is a part.
GENERAL
Each Indenture provides for the issuance of debt securities in one or more
series, and does not limit the principal amount of debt securities that may be
issued thereunder.
Reference is made to the applicable 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 the 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 at
which the Debt Securities will bear interest; (7) any index, security, group
of securities or formula used to determine the amount of principal of,
premium, if any, and interest, if any, on the Debt Securities (8) the time or
times at which any such principal, premium, if any, 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 Series Preferred
Stock and Common Stock; (12) the currency or units of two or more currencies
in which the Debt Securities are denominated, if other than U.S. dollars, and
the currency or units 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
4
<PAGE>
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 and the remedies with respect thereto not set forth in the
respective Indenture; and (18) any other specific terms of the Debt
Securities.
SUBORDINATION
Unless otherwise indicated in the applicable 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 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, premium, if any, and interest on the
Subordinated Debt Securities will, to the extent set forth in the 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 the
Subordinated Indenture, "Excess Proceeds") and if, at such time, any Entitled
Persons (as defined below) 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.
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 Entitled Persons 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 Entitled Persons in
respect of Other Financial Obligations and may recover more, ratably, than the
holders of Subordinated Debt Securities.
Senior Indebtedness is defined in the 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 of the Corporation
for money borrowed, whether
5
<PAGE>
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 or to rank pari passu with the Subordinated Debt
Securities or is identified in a Board Resolution or any indenture
supplemental to the Subordinated Indenture as not superior in right of payment
or to rank pari passu with the 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. The term "indebtedness for money
borrowed," when used with respect to the Corporation, 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 the Corporation's 8% Subordinated
Debentures due March 1997, Zero Coupon Subordinated Yen Notes due 1997-2004,
Subordinated Money Market Capital Notes, Series A, B and C due June 1999,
9.20% Subordinated Capital Notes due July 15, 1999, 9.50% Subordinated
Debentures due June 14, 2000, 9.40% Subordinated Debentures due March 1, 2001,
9.00% Subordinated Debentures due August 1, 2001, 7.50% Subordinated
Debentures due January 15, 2002, 8 1/8% Subordinated Notes due 2002, 8 1/8%
Subordinated Debentures due May 15, 2002, 7 1/8% Subordinated Debentures due
July 31, 2002, Subordinated Floating Rate Notes due 2002, 7.25% Subordinated
Debentures due January 15, 2003, Subordinated Constant Maturity Treasury
Floating Rate Debentures due 2003, Subordinated LIBOR CMT Floating Rate
Debentures due 2003, Subordinated Floating Rate Notes due 2004, 8 1/4%
Subordinated Notes due 2005, Subordinated Floating Rate Notes due 2005,
Subordinated Yen Loan due 2005, 7 1/8% Subordinated Notes due March 15, 2006,
6% Subordinated Notes due October 2008, 7 3/8% Subordinated Notes due 2008, 7
1/8% Subordinated Notes due 2010, 7 1/4% Subordinated Notes due October 15,
2011, 7 1/2% Subordinated Notes due 2010, 7 1/2% Subordinated Notes due
November 15, 2015, 6 1/8% Convertible Capital Securities due June 2033 and
6.00% Convertible Capital Securities due August 2033 and such other
indebtedness as may be specified in the applicable Prospectus Supplement.
"Other Financial Obligations" means 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. "Entitled Persons" means any
person who is entitled to payment pursuant to the terms of Other Financial
Obligations.
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 holders of
Subordinated Debt Securities to pay over any Excess Proceeds to Entitled
Persons in respect of Other Financial Obligations as provided in the
applicable Subordinated Indenture.
As of September 30, 1996, Senior Indebtedness and Other Financial
Obligations of the Corporation aggregated approximately $15 billion.
The Subordinated Indenture does 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 certificated or global form.
Debt Securities may be presented for registration of transfer (with the form
of transfer endorsed thereon duly executed) at the office of the Security
6
<PAGE>
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 an applicable Prospectus
Supplement, without service charge and upon payment of any taxes and other
governmental charges as described in the relevant 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 and (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 an 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 an 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
Security (or Predecessor Security) is registered at the close of business on
the Regular Record Date for such interest.
Unless otherwise indicated in an 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 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
respective 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
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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, if any, on, any such debt security, (b) reduce the principal
amount of, or premium or rate of interest, if any, 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, if any, 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 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 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 or purchase 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 the Subordinated Indenture as being 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 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 the Subordinated
Trustee annually a statement as to the performance by the Corporation of its
obligations under the 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.
The 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 or purchase fund installment) if
such Subordinated Trustee considers it in the interest of the holders of such
series of Subordinated Debt Securities to do so.
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The Subordinated Indenture does 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 persons, 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.
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 become 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 shall 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.
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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.
Subordinated Trustee
Bankers serves as trustee under various indentures for affiliates of the
Subordinated Trustee. In addition, the Corporation and Bankers have other
relationships arising in the ordinary course of business with the Subordinated
Trustee.
BOOK-ENTRY SECURITIES
The Debt Securities may be issued in the form of one or more global
certificates (collectively, with respect to each series or issue of Debt
Securities, the "Global Debt 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 Debt Securities that are issued in global form. No
person that acquires an interest in such Debt Securities will be entitled to
receive a certificate representing such person's interest in such Offered
Securities except as set forth herein or in the applicable Prospectus
Supplement. Unless and until definitive Debt Securities are issued under the
limited circumstances described herein, all references to actions by holders
of Debt 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 such holders shall refer to payments and
notices to DTC or Cede, as the registered holder of such Debt Securities.
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,
Debt 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 the
Corporation as registered holders of the Debt Securities entitled to the
benefits of the applicable Indenture or the terms of the Debt Securities.
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 Debt Securities among Participants and to receive
and transmit payments to Participants. Participants and Indirect Participants
with which holders have accounts with respect to the Debt Securities similarly
are required by the Rules to make book-entry transfers and receive and
transmit such payments on behalf of their respective holders.
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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 Debt Securities to persons or entities that do not participate in the
DTC system, or to otherwise act with respect to such Debt Securities, may be
limited due to the absence of physical certificates for such Debt Securities.
DTC has advised the Corporation that DTC will take any action permitted to
be taken by a registered holder of any Debt Securities under the applicable
Indenture or the terms of the Debt Securities only at the direction of one or
more Participants to whose accounts with DTC such Debt Securities are
credited.
A Global Debt Security will be exchangeable for the relevant definitive Debt
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 Debt 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 an order
complying with the requirements of the applicable Indenture that such Global
Debt Security will 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 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 Debt Security that is
exchangeable pursuant to the preceding sentence will be exchangeable for Debt
Securities or definitive Debt Securities 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 Debt Securities. Upon surrender by DTC
of the Global Debt Security representing the Debt Securities and delivery of
instructions for re-registration, the Trustee or the applicable registrar, as
the case may be, will reissue the Debt Securities as definitive Debt
Securities, and thereafter such Trustee or the applicable registrar will
recognize the holders of such definitive Debt Securities as registered holders
of Debt Securities entitled to the benefits of the applicable Indenture or the
terms of the Debt Securities, as the case may be.
Except as described above, the Global Debt 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 Debt Security evidencing
all or part of the Debt Securities unless such beneficial interest is in an
amount equal to an authorized denomination for the Debt Securities.
UNITED STATES TAXATION
Certain special United States federal income tax considerations may be
applicable to the Debt Securities (including those issued at an original issue
discount). If securities are issued at an original issue discount or such tax
considerations are material to investors, the applicable Prospectus Supplement
will describe the tax considerations and a tax opinion will be filed with the
Commission. Prospective purchasers of Debt Securities are urged to consult
their own tax advisors prior to any acquisition of such Debt Securities.
FOREIGN CURRENCY RISKS
GENERAL
Debt Securities of a series may be denominated in such foreign currencies or
currency units as may be designated by the Corporation at the time of offering
(the "Foreign Currency Securities").
ADDITIONAL FACTORS WILL BE SET FORTH IN CONNECTION WITH A SPECIFIC FOREIGN
CURRENCY SECURITY IN THE APPLICABLE PROSPECTUS SUPPLEMENT.
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Unless otherwise indicated in an 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, 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 possibility of
significant changes in the rate of exchange between the U.S. dollar and the
currency or currency unit 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. 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 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 converts U.S. dollars to the Specified Currency for payment of the
judgment.
VALIDITY OF OFFERED SECURITIES
Unless otherwise specified in the applicable Prospectus Supplement, 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 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 .02% of the Corporation's outstanding Common Stock.
EXPERTS
The consolidated financial statements of the Corporation and subsidiaries
for the year ended December 31, 1995, appearing in the Corporation's Annual
Report on Form 10-K for the year ended December 31, 1995, and incorporated by
reference into this Prospectus, 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.
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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.
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 as shall be set forth in any
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
agent. 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 agent.
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 amount 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 amount of the Offered Securities less the principal amount
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.
BT Securities Corporation ("BT Securities"), which is a member of the
National Association of Securities Dealers, Inc. (the "NASD"), a subsidiary of
the Corporation, may participate in the distributions of the Offered
Securities. The offer and sale of the Offered Securities will conform with the
requirements set forth in Rule 2720 of the Conduct Rules of the NASD.
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Any market making activities of BT Securities with respect to the Offered
Securities will be conducted in compliance with the requirements of Rule 2720
of the Conduct Rules of the NASD. Following the initial distribution of any
Offered Securities, BT Securities and other affiliates of the Corporation may
offer and sell such Offered Securities in the course of their business as
broker-dealers. BT Securities and such other affiliates may act as principals
or agents in such transactions. This Prospectus may be used by BT Securities
and such other affiliates in connection with such transactions. Such sales, if
any, will be made at varying prices related to prevailing market prices at the
time of sale or otherwise. Neither BT Securities nor such other affiliates are
obligated to make a market in any of the Offered Securities and may
discontinue any market-making activities at any time without notice.
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.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution of the
securities being registered, other than underwriting compensation, are:
<TABLE>
<S> <C>
Filing fee for registration statement........................... $175,758
Legal fees and expenses......................................... 150,000*
Accounting fees and expenses.................................... 75,000*
Blue sky fees and expenses...................................... 20,000*
Printing and engraving fees..................................... 50,000*
Trustees' fees and expenses..................................... 60,000*
Listing fees and expenses....................................... 100,000*
Rating agency fees.............................................. 200,000*
NASD Fees....................................................... 30,500
Miscellaneous................................................... 38,742*
--------
Total....................................................... $900,000*
========
</TABLE>
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* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article V of the By-Laws of Bankers Trust New York Corporation provides as
follows:
Section 5.01 The corporation shall, to the fullest extent permitted by
Section 721 of the New York Business Corporation Law, indemnify any person who
is or was made, or threatened to be made, a party to an action or proceeding,
whether civil or criminal, whether involving any actual or alleged breach of
duty, neglect or error, any accountability, or any actual or alleged
misstatement, misleading statement or other act or omission and whether
brought or threatened in any court or administrative or legislative body or
agency, including an action by or in the right of the corporation to procure a
judgment in its favor and an action by or in the right of any other
corporation of any type or kind, domestic or foreign, or any partnership,
joint venture, trust, employee benefit plan or other enterprise, which any
director or officer of the corporation is serving or served in any capacity at
the request of the corporation by reason of the fact that he, his testator or
intestate, is or was a director or officer of the corporation, or is serving
or served such other corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise in any capacity, against judgments, fines,
amounts paid in settlement, and costs, charges and expenses, including
attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
Section 5.02 The corporation may indemnify any other person to whom the
corporation is permitted to provide indemnification or the advancement of
expenses by applicable law, whether pursuant to rights granted pursuant to, or
provided by, the New York Business Corporation Law or other rights created by
(i) a resolution of shareholders, (ii) a resolution of directors, or (iii) an
agreement providing for such indemnification, it being expressly intended that
these By-Laws authorize the creation of other rights in any such manner.
Section 5.03 The corporation shall, from time to time, reimburse or advance
to any person referred to in Section 5.01 the funds necessary for payment of
expenses, including attorneys' fees, incurred in connection with any action or
proceeding referred to in Section 5.01, upon receipt of a written undertaking
by or on behalf of such person to repay such amount(s) if a judgment or other
final adjudication adverse to the director or officer
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establishes that (i) his acts were committed in bad faith or were the result
of active and deliberate dishonesty and, in either case, were material to the
cause of action so adjudicated, or (ii) he personally gained in fact a
financial profit or other advantage to which he was not legally entitled.
Section 5.04 Any director or officer of the corporation serving (i) another
corporation, of which a majority of the shares entitled to vote in the
election of its directors is held by the corporation, or (ii) any employee
benefit plan of the corporation or any corporation referred to in clause (i),
in any capacity shall be deemed to be doing so at the request of the
corporation. In all other cases, the provisions of this Article V will apply
(i) only if the person serving another corporation or any partnership, joint
venture, trust, employee benefit plan or other enterprise so served at the
specific request of the corporation, evidenced by a written communication
signed by the Chairman of the Board, the Chief Executive Officer, the
President, the Senior Vice Chairman or any Vice Chairman, and (ii) only if and
to the extent that, after making such efforts as the Chairman of the Board,
the Chief Executive Officer, or the President shall deem adequate in the
circumstances, such person shall be unable to obtain indemnification from such
other enterprise or its insurer.
Section 5.05 Any person entitled to be indemnified or to the reimbursement
or advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of the
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect
at the time indemnification is sought.
Section 5.06 The right to be indemnified or to the reimbursement or
advancement of expenses pursuant to this Article V (i) is a contract right
pursuant to which the person entitled thereto may bring suit as if the
provisions hereof were set forth in a separate written contract between the
corporation and the director or officer, (ii) is intended to be retroactive
and shall be available with respect to events occurring prior to the adoption
hereof, and (iii) shall continue to exist after the rescission or restrictive
modification hereof with respect to events occurring prior thereto.
Section 5.07 If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the corporation
within thirty days after a written claim has been received by the corporation,
the claimant may at any time thereafter bring suit against the corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the claimant shall be entitled also to be paid the expenses of prosecuting
such claim. Neither the failure of the corporation (including its Board of
Directors, independent legal counsel, or its shareholders) to have made a
determination prior to the commencement of such action that indemnification of
or reimbursement or advancement of expenses to the claimant is proper in the
circumstances, nor an actual determination by the corporation (including its
Board of Directors, independent legal counsel, or its shareholders) that the
claimant is not entitled to indemnification or to the reimbursement or
advancement of expenses, shall be a defense to the action or create a
presumption that the claimant is not so entitled.
Section 5.08 A person who has been successful, on the merits or otherwise,
in the defense of a civil or criminal action or proceeding of the character
described in Section 5.01 shall be entitled to indemnification only as
provided in Section 5.01 and 5.03, notwithstanding any provision of the New
York Business Corporation Law to the contrary.
With certain limitations, Sections 721 through 726 of the New York Business
Corporation Law permit a corporation to indemnify a director or officer made a
party to an action (i) by a corporation or in its right in order to procure a
judgment in its favor unless he shall have breached his duties, or (ii) other
than an action by or in the right of the corporation in order to procure a
judgment in its favor if such director or officer acted in good faith and in a
manner he reasonably believed to be in or, in certain cases, not opposed to
such corporation's best interests, and additionally, in criminal actions, has
no reasonable cause to believe his conduct was unlawful.
II-2
<PAGE>
In addition, a Directors and Officer Liability and Corporation Reimbursement
Policy is maintained covering the Corporation and its directors and officers
for amounts, subject to policy limits, that the Corporation might be required
to pay by way of indemnification to its directors or officers under its By-
Laws or otherwise and for the protection of individual directors and officers
from loss for which they might not be indemnified by the Corporation.
Reference is made to the forms of Underwriting Agreements filed as Exhibits
1.1 and 1.2 hereto for a description of certain indemnity arrangements.
Under the Amended and Restated Declarations of Trust (Exhibits 4.10, 4.11,
4.12 and 4.13 to this Registration Statement), Bankers Trust New York
Corporation will agree to indemnify each of the Trustees of the Trusts and any
predecessor Trustees, and to hold such Trustees harmless, against any loss,
damage, claims, liability or expense incurred without negligence or bad faith
on their part, arising out of or in connection with the acceptance or
administration of such Declarations of Trust, including the costs and expenses
of defense against any claim or liability in connection with the exercise or
performance of any of their powers or duties under the Declarations of Trust.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<C> <S>
1.1 --Form of Underwriting Agreement for Junior Subordinated Debentures, Preferred
Securities and Guarantees.
***1.2 --Form of Underwriting Agreement for Debt Securities.
***4.1 --Form of Indenture for Junior Subordinated Debentures between Bankers Trust New
York Corporation and Wilmington Trust Company, as Indenture Trustee.
***4.2 --Certificate of Trust of BT Preferred Capital Trust I.
***4.3 --Declaration of Trust of BT Preferred Capital Trust I.
***4.4 --Certificate of Trust of BT Preferred Capital Trust II.
***4.5 --Declaration of Trust of BT Preferred Capital Trust II.
***4.6 --Certificate of Trust of BT Preferred Capital Trust III.
***4.7 --Declaration of Trust of BT Preferred Capital Trust III.
***4.8 --Certificate of Trust of BT Preferred Capital Trust IV.
***4.9 --Declaration of Trust of BT Preferred Capital Trust IV.
***4.10 --Form of Amended and Restated Declaration of Trust of BT Preferred Capital Trust
I, II, III and IV.
***4.11 --Form of Preferred Security Certificate for BT Preferred Capital Trust I, II, III
and IV (included as Exhibit E of Exhibit 4.10).
***4.12 --Form of Guarantee Agreement for BT Preferred Capital Trust I, II, III and IV.
**4.13 --Indenture, dated as of November 1, 1991, between the Registrant and The Chase
Manhattan Bank (National Association) relating to Senior Debt Securities (filed as
an Exhibit to the Registrant's Current Report on Form 8-K, dated November 12,
1991, file number 1-5920).
**4.14 --First Supplemental Indenture, dated as of September 1, 1993, between the
Registrant and The Chase Manhattan Bank (National Association) (filed as an
Exhibit to the Registrant's Current Report on Form 8-K, dated October 22, 1993,
file number 1-5920).
**4.15 --Indenture, dated as of April 1, 1992, between the Registrant and Marine Midland
Bank, N.A. relating to Subordinated Debt Securities (filed as an Exhibit to the
Registrant's Registration Statement on Form S-3, file number 33-50395, as filed on
September 24, 1993).
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
**4.16 --First Supplemental Indenture, dated as of January 15, 1993, between the
Registrant and Marine Midland Bank, N.A. (filed as an Exhibit to the Registrant's
Current Report on Form 8-K dated January 14, 1993, file number 1-5920).
***4.17 --Form of Certificate for Debt Securities.
5.1 --Opinion of Sullivan & Cromwell as to the legality of the Junior Subordinated Debt
Securities and the Guarantees to be issued by Bankers Trust New York Corporation.
5.2 --Opinion of Richards, Layton & Finger as to the legality of the Preferred
Securities to be issued by BT Preferred Capital Trust I.
5.3 --Opinion of Richards, Layton & Finger as to the legality of the Preferred
Securities to be issued by BT Preferred Capital Trust II.
5.4 --Opinion of Richards, Layton & Finger as to the legality of the Preferred
Securities to be issued by BT Preferred Capital Trust III.
5.5 --Opinion of Richards, Layton & Finger as to the legality of the Preferred
Securities to be issued by BT Preferred Capital Trust IV.
***5.6 --Opinion of Gordon S. Calder, Jr., Esq., as to the legality of the Debt Securities
to be issued by Bankers Trust New York Corporation.
8.1 --Opinion of Sullivan & Cromwell as to certain federal income tax matters.
12.1 --Computation of Consolidated Ratios of Earnings to Fixed Charges.
12.2 --Computation of Consolidated Ratios of Earnings to Combined Fixed Charges and
Preferred Stock Dividend Requirements.
***23.1 --Consent of Independent Auditors.
23.2 --Consent of Sullivan & Cromwell (contained in the opinion filed as Exhibit 5.1 to
this Registration Statement).
23.3 --Consent of Richards, Layton & Finger (contained in the opinions filed as Exhibits
5.2, 5.3, 5.4 and 5.5 to this Registration Statement).
***23.4 --Consent of Gordon S. Calder, Jr., Esq. (contained in the opinion file as Exhibit
5.6 to this Registration Statement).
23.5 --Consent of Sullivan & Cromwell (contained in the opinion filed as Exhibit 8.1 to
this Registration Statement).
***24.1 --Powers of Attorney.
***25.1 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the indenture relating to the
Junior Subordinated Debentures.
***25.2 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Amended and Restated
Declaration of Trust of BT Preferred Capital Trust I.
***25.3 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Amended and Restated
Declaration of Trust of BT Preferred Capital Trust II.
***25.4 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Amended and Restated
Declaration of Trust of BT Preferred Capital Trust III.
***25.5 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Amended and Restated
Declaration of Trust of BT Preferred Capital Trust IV.
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
***25.6 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Guarantee for the benefit of
the holders of Preferred Securities issued by BT Preferred Capital Trust I.
***25.7 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Guarantee for the benefit of
the holders of Preferred Securities issued by BT Preferred Capital Trust II.
***25.8 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Guarantee for the benefit of
the holders of Preferred Securities issued by BT Preferred Capital Trust III.
***25.9 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of
Wilmington Trust Company to act as trustee under the Guarantee for the benefit of
the holders of Preferred Securities issued by BT Preferred Capital Trust IV.
***25.10 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The
Chase Manhattan Bank (National Association).
***25.11 --Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of Marine
Midland Bank, as amended.
</TABLE>
- --------
*To be filed by amendment.
**Incorporated by reference.
*** Previously filed.
ITEM 17. UNDERTAKINGS.
Each of the undersigned registrants hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports file by a registrant pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
II-5
<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
Each of the undersigned registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of a
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Each of the undersigned registrants hereby undertakes to provide to the
underwriter at the closing specified in the underwriting agreements,
certificates in such denominations and registered in such names as required by
the underwriter to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of a
registrant pursuant to the foregoing provisions, or otherwise, the registrants
have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, each registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
Each of the undersigned registrants hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of the
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-6
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT TO BE
SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE
CITY OF NEW YORK, STATE OF NEW YORK, ON THE 30TH DAY OF JANUARY, 1997.
Bankers Trust New York Corporation
/s/ James T. Byrne, Jr.
By: _________________________________
(JAMES T. BYRNE, JR.) SENIOR VICE
PRESIDENT
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATE INDICATED:
SIGNATURE TITLE DATE
Frank N. Newman* Chairman of the
- ------------------------------------- Board, Chief January 30,
(FRANK N. NEWMAN) Executive Officer 1997
and Director
(Principal
Executive Officer)
Richard H. Daniel* Executive Vice
- ------------------------------------- President and Chief January 30,
(RICHARD H. DANIEL) Financial Officer 1997
and Controller
(Principal
Financial Officer)
Geoffrey M. Fletcher* Senior Vice
- ------------------------------------- President January 30,
(GEOFFREY M. FLETCHER) (Principal 1997
Accounting Officer)
George B. Beitzel* Director
- ------------------------------------- January 30,
(GEORGE B. BEITZEL) 1997
Philip A. Griffiths* Director
- ------------------------------------- January 30,
(PHILIP A. GRIFFITHS) 1997
William R. Howell* Director
- ------------------------------------- January 30,
(WILLIAM R. HOWELL) 1997
Jon M. Huntsman* Director
- ------------------------------------- January 30,
(JON M. HUNTSMAN) 1997
II-7
<PAGE>
SIGNATURE TITLE DATE
Director
- ------------------------------------- January 30,
(VERNON E. JORDAN, JR.) 1997
Hamish Maxwell* Director
- ------------------------------------- January 30,
(HAMISH MAXWELL) 1997
N.J. Nicholas Jr.* Director
- ------------------------------------- January 30,
(N.J. NICHOLAS JR.) 1997
Russell E. Palmer* Director
- ------------------------------------- January 30,
(RUSSELL E. PALMER) 1997
Director
- ------------------------------------- January 30,
(DONALD L. STAHELI) 1997
Patricia C. Stewart* Director
- ------------------------------------- January 30,
(PATRICIA C. STEWART) 1997
George J. Vojta* Director
- ------------------------------------- January 30,
(GEORGE J. VOJTA) 1997
Paul A. Volcker* Director
- ------------------------------------- January 30,
(PAUL A. VOLCKER) 1997
/s/ James T. Byrne, Jr.
*By _________________________________
(JAMES T. BYRNE, JR., ATTORNEY-IN-
FACT)
II-8
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, BT PREFERRED
CAPITAL TRUST I CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT
MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
AMENDMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, AND STATE OF NEW YORK ON THE 30TH DAY OF
JANUARY, 1997.
BT Preferred Capital Trust I
By: Bankers Trust New York
Corporation
as Depositor
/s/ James T. Byrne, Jr.
By: _________________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, BT PREFERRED
CAPITAL TRUST II CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT
MEETS ALL THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
AMENDMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, AND STATE OF NEW YORK ON THE 30TH DAY OF
JANUARY, 1997.
BT Preferred Capital Trust II
By: Bankers Trust New York
Corporation
as Depositor
/s/ James T. Byrne, Jr.
By: _________________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, BT PREFERRED
CAPITAL TRUST III CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT
MEETS ALL THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
AMENDMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, AND STATE OF NEW YORK ON THE 30TH DAY OF
JANUARY, 1997.
BT Preferred Capital Trust III
By: Bankers Trust New York
Corporation,
as Depositor
/s/ James T. Byrne, Jr.
By: _________________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, BT PREFERRED
CAPITAL TRUST IV CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT
MEETS ALL THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS
AMENDMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, AND STATE OF NEW YORK ON THE 30TH DAY OF
JANUARY, 1997.
BT Preferred Capital Trust IV
By: Bankers Trust New York
Corporation,
as Depositor
/s/ James T. Byrne, Jr.
By: _________________________________
II-9
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
------- ----------- ----
<C> <S> <C>
1.1 --Form of Underwriting Agreement for Junior Subordinated
Debentures, Preferred Securities and Guarantees.
***1.2 --Form of Underwriting Agreement for Debt Securities.
***4.1 --Form of Indenture for Junior Subordinated Debentures between
Bankers Trust New York Corporation and Wilmington Trust
Company, as Indenture Trustee.
***4.2 --Certificate of Trust of BT Preferred Capital Trust I.
***4.3 --Declaration of Trust of BT Preferred Capital Trust I.
***4.4 --Certificate of Trust of BT Preferred Capital Trust II.
***4.5 --Declaration of Trust of BT Preferred Capital Trust II.
***4.6 --Certificate of Trust of BT Preferred Capital Trust III.
***4.7 --Declaration of Trust of BT Preferred Capital Trust III.
***4.8 --Certificate of Trust of BT Preferred Capital Trust IV.
***4.9 --Declaration of Trust of BT Preferred Capital Trust IV.
***4.10 --Form of Amended and Restated Declaration of Trust of BT
Preferred Capital Trust I, II, III and IV.
***4.11 --Form of Preferred Security Certificate for BT Preferred
Capital Trust I, II, III and IV (included as Exhibit E of
Exhibit 4.10).
***4.12 --Form of Guarantee Agreement for BT Preferred Capital Trust I,
II, III and IV.
**4.13 --Indenture, dated as of November 1, 1991, between the
Registrant and The Chase Manhattan Bank (National Association)
relating to Senior Debt Securities (filed as an Exhibit to the
Registrant's Current Report on Form 8-K, dated November 12,
1991, file number 1-5920).
**4.14 --First Supplemental Indenture, dated as of September 1, 1993,
between the Registrant and The Chase Manhattan Bank (National
Association) (filed as an Exhibit to the Registrant's Current
Report on Form 8-K, dated October 22, 1993, file number 1-
5920).
**4.15 --Indenture, dated as of April 1, 1992, between the Registrant
and Marine Midland Bank, N.A. relating to Subordinated Debt
Securities (filed as an Exhibit to the Registrant's
Registration Statement on Form S-3, file number 33-50395, as
filed on September 24, 1993).
**4.16 --First Supplemental Indenture, dated as of January 15, 1993,
between the Registrant and Marine Midland Bank, N.A. (filed as
an Exhibit to the Registrant's Current Report on Form 8-K
dated January 14, 1993, file number 1-5920).
***4.17 --Form of Certificate for Debt Securities.
5.1 --Opinion of Sullivan & Cromwell, as to the legality of the
Junior Subordinated Debt Securities and the Guarantees to be
issued by Bankers Trust New York Corporation.
5.2 --Opinion of Richards, Layton & Finger as to the legality of
the Preferred Securities to be issued by BT Preferred Capital
Trust I.
5.3 --Opinion of Richards, Layton & Finger as to the legality of
the Preferred Securities to be issued by BT Preferred Capital
Trust II.
5.4 --Opinion of Richards, Layton & Finger as to the legality of
the Preferred Securities to be issued by BT Preferred Capital
Trust III.
5.5 --Opinion of Richards, Layton & Finger as to the legality of
the Preferred Securities to be issued by BT Preferred Capital
Trust IV.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
------- ----------- ----
<C> <S> <C>
***5.6 --Opinion of Gordon S. Calder, Jr., Esq., as to the legality of
the Debt Securities to be issued by Bankers Trust New York
Corporation.
8.1 --Opinion of Sullivan & Cromwell as to certain federal income
tax matters.
12.1 --Computation of Consolidated Ratios of Earnings to Fixed
Charges.
12.2 --Computation of Consolidated Ratios of Earnings to Combined
Fixed Charges and Preferred Stock Dividend Requirements.
***23.1 --Consent of Independent Auditors.
23.2 --Consent of Sullivan & Cromwell (contained in the opinion
filed as Exhibit 5.1 to this Registration Statement).
23.3 --Consent of Richards, Layton & Finger (contained in the
opinions filed as Exhibits 5.2, 5.3, 5.4 and 5.5 to this
Registration Statement).
***23.4 --Consent of Gordon S. Calder, Jr., Esq. (contained in the
opinion filed as Exhibit 5.6 to this Registration Statement).
23.5 --Consent of Sullivan & Cromwell (contained in the opinion
filed as Exhibit 8.1 to this Registration Statement).
***24.1 --Powers of Attorney.
***25.1 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the indenture relating to the Junior Subordinated
Debentures.
***25.2 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Amended and Restated Declaration of Trust of BT
Preferred Capital Trust I.
***25.3 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Amended and Restated Declaration of Trust of BT
Preferred Capital Trust II.
***25.4 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Amended and Restated Declaration of Trust of BT
Preferred Capital Trust III.
***25.5 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Amended and Restated Declaration of Trust of BT
Preferred Capital Trust IV.
***25.6 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Guarantee for the benefit of the holders of
Preferred Securities issued by BT Preferred Capital Trust I.
***25.7 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Guarantee for the benefit of the holders of
Preferred Securities issued by BT Preferred Capital Trust II.
***25.8 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Guarantee for the benefit of the holders of
Preferred Securities issued by BT Preferred Capital Trust III.
***25.9 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Wilmington Trust Company to act as trustee
under the Guarantee for the benefit of the holders of
Preferred Securities issued by BT Preferred Capital Trust IV.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
------- ----------- ----
<C> <S> <C>
***25.10 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of The Chase Manhattan Bank (National
Association).
***25.11 --Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Marine Midland Bank, as amended.
</TABLE>
- --------
* To be filed by amendment.
** Incorporated by reference.
*** Previously filed.
<PAGE>
EXHIBIT 1.1
BANKERS TRUST NEW YORK CORPORATION
BT PREFERRED CAPITAL TRUSTS I, II, III AND IV
Preferred Securities
--------------------
Underwriting Agreement
Standard Provisions
(January 1997)
______________________________
From time to time, BANKERS TRUST NEW YORK CORPORATION, a New York
corporation (the "Corporation"), and any of BT Preferred Capital Trust I, BT
Preferred Capital Trust II, BT Preferred Capital Trust III or BT Preferred
Capital Trust IV, each a statutory business trust created under the laws of
Delaware (each, an "Issuer Trust"), may enter into one or more underwriting
agreements (each, an "Underwriting Agreement") that provide for the sale of
series of preferred securities (the "Preferred Securities") of the applicable
Issuer Trust to one or more underwriters named therein (the "Underwriters"),
severally where there are more than one. The standard provisions set forth
herein may be incorporated by reference in any such Underwriting Agreement. The
Underwriting Agreement, including the provisions incorporated therein by
reference, is herein referred to as "this Agreement". The Corporation and the
Issuer Trust that is to issue the series of Preferred Securities to which any
Underwriting Agreement relates are referred to collectively in this Agreement as
the "Offerors". Unless otherwise defined herein, terms defined in the
Underwriting Agreement are used herein as therein defined. If an Underwriting
Agreement provides for the purchase of the Offered Securities (as defined below)
by an Underwriter or Underwriters, but does not provide for a Manager or
Managers, the references to the Manager herein shall be deemed to refer to such
Underwriter or Underwriters.
The Preferred Securities issued by each Issuer Trust will be issued
pursuant to an amended and restated declaration of trust (the "Declaration of
Trust") relating to such Issuer Trust, among the Corporation, as depositor,
Wilmington Trust Company, a Delaware banking corporation, as property trustee
(the "Property Trustee"), Wilmington Trust
- 1 -
<PAGE>
Company, a Delaware banking corporation, as Delaware trustee (the "Delaware
Trustee"), the administrative trustees named therein (the "Administrative
Trustees"), and the holders from time to time of the undivided beneficial
interests in the assets of such Issuer Trust. The Preferred Securities of each
series will be guaranteed by the Corporation, to the extent set forth in the
Prospectus (as defined below), pursuant to a guarantee (each, a "Guarantee
Agreement") between the Corporation and Wilmington Trust Company, a Delaware
banking corporation, as guarantee trustee (the "Guarantee Trustee"). Each
Issuer Trust will hold a series of junior subordinated debentures (the "Junior
Subordinated Debentures") of the Corporation issued pursuant to a junior
subordinated indenture (the "Indenture") between the Corporation and Wilmington
Trust Company, as trustee (the "Debenture Trustee"). The Corporation will also
enter into an agreement as to expenses and liabilities (the "Expense Agreement")
with each Issuer Trust as described in the Prospectus. The Preferred
Securities, the Guarantee Agreements and the Junior Subordinated Debentures are
referred to collectively in this Agreement as the "Offered Securities".
I.
The Corporation and the Issuer Trusts have filed with the Securities
and Exchange Commission (the "Commission") a registration statement on Form S-3
(Registration Nos. 333-15809 and 333-15089-01 through 04), including a
prospectus relating to, among other securities, the Offered Securities and has
filed with, or mailed for filing to, the Commission, a prospectus supplement
specifically relating to the issue of the Offered Securities pursuant to Rule
424 under the Securities Act of 1933, as amended (the "Securities Act"). The
term "Registration Statement" means such registration statement as amended to
the date of the Underwriting Agreement. The term "Basic Prospectus" means the
prospectus included in the Registration Statement. The term "Prospectus" means
the Basic Prospectus together with the prospectus supplement specifically
relating to the Offered Securities, as filed with, or mailed for filing to, the
Commission pursuant to Rule 424. The term "preliminary prospectus" means a
preliminary prospectus supplement specifically relating to the Offered
Securities together with the Basic Prospectus. As used herein, the terms
"Registration Statement", "Basic Prospectus", "Prospectus" and "preliminary
prospectus" shall include in each case the documents, if any, incorporated by
reference therein.
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<PAGE>
II.
The Offerors are advised by the Manager that the Underwriters propose
to make a public offering of their respective portions of the Offered Securities
as soon after this Agreement is entered into as in the Manager's judgment is
advisable. The terms of the public offering of the Offered Securities are set
forth in the Prospectus.
III.
Payment for the Offered Securities shall be made by certified or
official bank check or checks or fedwire payable to the order of the Issuer
Trust in Federal (same day) funds or in such other manner and such other funds
as may be set forth in the Underwriting Agreement, at the time and place set
forth in the Underwriting Agreement, upon delivery to the Manager for the
respective accounts of the several Underwriters of the Offered Securities
registered in such names and in such denominations as the Manager shall request
in writing not less than two full business days prior to the date of delivery or
as may be set forth in the Underwriting Agreement. The time and date of such
payment and delivery with respect to the Offered Securities are herein referred
to as the "Closing Date".
IV.
The several obligations of the Underwriters to purchase and pay for
the Offered Securities are subject to the following conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall be in effect, and no proceedings for such purpose shall be
pending before or threatened by the Commission; and there shall have been no
material adverse change (not in the ordinary course of business) in the
financial condition or results of operations of the Corporation and its
subsidiaries, taken as a whole, from that set forth in the Prospectus since
the effective dates as of which information is given therein; and the
Manager shall have received, on the Closing Date, a certificate, dated the
Closing Date and signed by an executive officer of the Corporation, to the
foregoing effect and also to the effect that the representations and
warranties of the Corporation in this Agreement are true and correct in all
material respects as of the Closing Date. The officer making
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<PAGE>
such certificate may rely upon the best of his knowledge as to proceedings
pending or threatened.
(b) The Manager shall have received an opinion or opinions, dated the
Closing Date, of Sullivan & Cromwell, special counsel to the Offerors, to
the effect set forth in Exhibit A.
(c) The Manager shall have received an opinion or opinions, dated the
Closing Date, of Gordon S. Calder, Jr., counsel to the Offerors, to the
effect set forth in Exhibit B.
(d) The Manager shall have received an opinion or opinions, dated the
Closing Date, of Sullivan & Cromwell, special tax counsel to the Offerors,
to the effect set forth in Exhibit C.
(e) The Manager shall have received an opinion or opinions, dated the
Closing Date, of Richards, Layton & Finger, Delaware counsel to the
Offerors, to the effect set forth in Exhibit D.
(f) The Manager shall have received an opinion or opinions, dated the
Closing Date, of Richards, Layton & Finger, counsel to the Property Trustee,
the Delaware Trustee, the Guarantee Trustee and the Debenture Trustee, to
the effect set forth in Exhibit E.
(g) The Manager shall have received an opinion or opinions, dated the
Closing Date, of White & Case, counsel to the Underwriters, to the effect
set forth in Exhibit F.
(h) The Manager shall have received a letter, dated the Closing Date
and in form and substance satisfactory to the Manager, from the independent
accountants to the Corporation, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial information
contained in or incorporated by reference into the Registration Statement
and the Prospectus, and confirming that they are independent accountants
within the meaning of the Securities Act and the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the respective applicable
published rules and regulations of the Commission thereunder.
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<PAGE>
V.
In further consideration of the agreements of the Underwriters
contained in this Agreement, the Offerors covenant as follows:
(a) To furnish the Manager, without charge, a copy of the Registration
Statement including exhibits and materials, if any, incorporated by
reference therein and, during the period mentioned in paragraph (c) below,
as many copies of the Prospectus, any documents incorporated by reference
therein and any supplements and amendments thereto as the Manager may
reasonably request. The terms "supplement" and "amendment" or "amend" as
used in this Agreement shall include all documents filed by the Corporation
with the Commission subsequent to the date of the Basic Prospectus, pursuant
to the Exchange Act, which are deemed to be incorporated by reference in the
Prospectus.
(b) Before amending or supplementing the Registration Statement or the
Prospectus with respect to the Offered Securities, to furnish the Manager
with a copy of each such proposed amendment or supplement.
(c) If, at any time during the period following the public offering of
the Offered Securities during which, in the opinion of counsel for the
Underwriters, the Prospectus is required by law to be delivered, any event
shall occur as a result of which it is necessary to amend or supplement the
Prospectus in order to ensure that the Prospectus does not contain an untrue
statement of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, or it is necessary to amend or supplement
the Prospectus to comply with law, forthwith to prepare and furnish, at
their own expense, to the Underwriters, either amendments or supplements to
the Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances under which they
were made, be misleading or so that the Prospectus will comply with law, as
the case may be.
(d) To endeavor to qualify the Offered Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions as the Manager
shall reasonably request and to pay all reasonable expenses (including fees
and disbursements of counsel) in
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<PAGE>
connection with such qualification, the determination of the eligibility of
the Offered Securities for investment under the laws of such jurisdictions
as the Manager may reasonably designate, the printing of any memoranda
concerning the aforesaid qualification or eligibility and the rating of the
Offered Securities by securities rating services.
(e) To make generally available to the Corporation's security holders
as soon as practicable, but not later than sixteen months, after the date of
each Underwriting Agreement an earnings statement covering a period of at
least twelve months beginning after the later of (i) the effective date of
the Registration Statement, (ii) the effective date of the most recent post-
effective amendment to the Registration Statement to become effective prior
to the date of such Underwriting Agreement, and (iii) the date of the
Corporation's most recent Annual Report on Form 10-K filed with the
Commission prior to the date of such Underwriting Agreement, which shall
satisfy the provisions of Section 11(a) of the Securities Act.
(f) During the period beginning on the date of the Underwriting
Agreement and continuing to and including the earlier of the Closing Date or
the removal by the Manager of trading restrictions on the Offered
Securities, not to offer, sell, contract to sell or otherwise dispose of
(other than upon exercise of warrants therefor, on conversion of convertible
securities or pursuant to registration rights agreements, in each case
outstanding at the date of the Underwriting Agreement, or in an offering
made exclusively outside the United States) any securities of either Offeror
substantially similar to the Preferred Securities without the prior written
consent of the Manager.
VI.
The Corporation covenants and agrees with each Underwriter that the
Corporation will pay or cause to be paid the following: (i) the fees for the
registration of the Offered Securities under the Securities Act; (ii) the fees,
disbursements and expenses of the Corporation's accountants in connection with
the registration of the Offered Securities under the Securities Act and all
other expenses incurred by it in connection with the preparation and filing of
the Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements
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<PAGE>
thereto and delivery of copies thereof to the Underwriters; (iii) all expenses
(including reasonable fees and disbursements of counsel) payable pursuant to
paragraph (d) of Article V of this Agreement; (iv) the filing fees incident to
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Offered Securities, fees paid in connection
with any listing of the Offered Securities on the New York Stock Exchange, Inc.
or any other stock exchange or quotation system and any fees of rating agencies;
(v) all costs and expenses incurred in the preparation and printing of the
Prospectus, the Registration Statement and any amendments or supplements
thereto, this Agreement and all other documents relating to the issuance,
underwriting and initial offering of the Offered Securities; (vi) all costs,
fees and expenses relating to the preparation and filing via the Commission's
Electronic Data Gathering and Retrieval System of the Prospectus, the
Registration Statement and any amendments or supplements thereto, this Agreement
and all other documents relating to the issuance, underwriting and initial
offering of the Offered Securities; and (vii) all other costs and expenses
incident to the performance by the Offerors of their obligations hereunder that
are not otherwise specifically provided for in this Article VI.
VII.
The Corporation represents and warrants to each Underwriter that (i)
each document, if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus complied or will comply when so
filed in all material respects with the Exchange Act and the rules and
regulations of the Commission thereunder; (ii) each part of the Registration
Statement (including the documents incorporated by reference therein), filed
with the Commission pursuant to the Securities Act relating to the Offered
Securities, when such part became effective, did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading; (iii)
each preliminary prospectus, if any, filed pursuant to Rule 424 under the
Securities Act complied when so filed in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder; (iv) the Registration Statement and the Prospectus comply and, as
amended or supplemented, if applicable, will comply in all material respects
with the Securities Act and the applicable rules and regulations of the
Commission thereunder; and (v) the Registration Statement and the Prospectus do
not contain and, as amended
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<PAGE>
or supplemented, if applicable, will not contain, any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; except that these representations and warranties do not
apply to statements in or omissions from the Registration Statement, any
preliminary prospectus or the Prospectus based upon information furnished to the
Corporation in writing by an Underwriter expressly for use therein.
Each Offeror agrees, jointly and severally, to indemnify and hold
harmless each Underwriter and each person, if any, who controls such Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages and
liabilities caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, any preliminary
prospectus or the Prospectus, or in any blue sky application or related document
prepared pursuant to paragraph (d) of Article V hereof, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement or omission based
upon information furnished in writing to the Corporation by an Underwriter
expressly for use therein; provided that the foregoing indemnity agreement with
--------
respect to any Prospectus shall not inure to the benefit of any Underwriter from
whom the person asserting any such losses, claims, damages or liabilities
purchased Offered Securities, or any person controlling such Underwriter, if (i)
the loss, claim, damage or liability asserted by such purchaser was caused by a
defect in the Prospectus delivered to such purchaser after the period referred
to in paragraph (c) of Article V of this Agreement and such defect would not
have existed before the expiry of such period, or (ii) a copy of the Prospectus
(as then amended or supplemented if the Corporation shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person at or prior to the written confirmation of the sale
of the Offered Securities to such person, and if the Prospectus (as so amended
or supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Corporation, its directors and its officers who sign the
Registration
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<PAGE>
Statement, any authorized representative of the Corporation and any person
controlling the Corporation to the same extent as the foregoing indemnity from
the Corporation to each Underwriter, but only with reference to information
furnished in writing by such Underwriter expressly for use in the Registration
Statement, any preliminary prospectus or the Prospectus and any amendments or
supplements thereto.
If any proceeding (including any governmental investigation) shall be
threatened or instituted involving any person in respect of which indemnity may
be sought pursuant to either of the two preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the reasonable fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have the right
to retain its own counsel, but fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm for all such indemnified parties. In
the case of parties indemnified pursuant to the second preceding paragraph, such
separate firm shall be designated in writing by the Manager. In the case of
parties indemnified pursuant to the immediately preceding paragraph, such
separate firm shall be designated in writing by the Corporation. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment.
If the indemnification provided for in this Article VII is unavailable
to an indemnified party under the second or third paragraphs hereof or
insufficient in respect
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<PAGE>
of any losses, claims, damages or liabilities referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors on the one
hand and the Underwriters on the other from the offering of the Offered
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Offerors on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Offerors on the one hand
and the Underwriters on the other in connection with the offering of the Offered
Securities shall be deemed to be in the same proportion as the total net
proceeds (before deducting expenses) from the offering of such Offered
Securities received by the Offerors bear to the total underwriting discounts and
commissions received by the Underwriters in respect thereof. The relative fault
of the Offerors on the one hand and of the Underwriters on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Offerors or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statements or omissions.
The Offerors and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Article VII were determined by pro
rata allocation (even if all of the Underwriters are treated as a single entity
for such purpose) or by any other method of allocation that does not take
account of the considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any reasonable legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Article VII, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total public offering price of the Offered Securities purchased by such
Underwriter exceeds the amount
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<PAGE>
of any damages that such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Article VII are
several, in proportion to the respective number of Preferred Securities
purchased by each of such Underwriters, and not joint.
The indemnity and contribution agreements contained in this Article
VII and the representations and warranties of the Corporation in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any Underwriter or
on behalf of any Underwriter or any person controlling any Underwriter or by or
on behalf of the Offerors, their directors or officers, any authorized
representative of an Offeror or any person controlling an Offeror and (iii)
acceptance of and payment for any of the Offered Securities.
VIII.
This Agreement shall be subject to termination in the absolute
discretion of the Manager, by notice given to the Offerors, if prior to the
Closing Date (i) trading in securities generally on the New York Stock Exchange,
Inc., or on any other stock exchange or automated quotation system on which the
Offered Securities are or are to be listed or to which the Offered Securities
have been or are to be admitted for quotation, shall have been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York shall have been declared by either Federal or New York State
authorities or (iii) there shall have occurred any material outbreak or
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the reasonable
judgment of the Manager, impracticable to market the Offered Securities.
IX.
If on the Closing Date any one or more of the Underwriters shall fail
or refuse to purchase Offered Securities that it or they have agreed to purchase
hereunder and the aggregate number of Offered Securities that such defaulting
Underwriter or Underwriters agreed but failed or
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<PAGE>
refused to purchase is not more than one-tenth of the aggregate number of
Offered Securities to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions which the number of Offered Securities
set forth opposite their names in the Underwriting Agreement bears to the
aggregate number of Offered Securities set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the Manager may
specify, to purchase the Offered Securities that such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date. If on the
Closing Date any Underwriter or Underwriters shall fail or refuse to purchase
Offered Securities and the aggregate number of Offered Securities with respect
to which such default occurs is more than one-tenth of the aggregate number of
Offered Securities to be purchased on such date, and arrangements satisfactory
to the Manager and the Offerors for the purchase of such Offered Securities are
not made within 36 hours after such default, this Agreement shall thereupon
terminate without liability on the part of any non-defaulting Underwriter or of
the Offerors. In any such case either the Manager or the Offerors shall have
the right to postpone the Closing Date, but in no event for longer than seven
days, in order that the required changes, if any, in the Registration Statement
and in the Prospectus or in any other documents or arrangements may be effected.
Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
X.
If this Agreement shall be terminated by the Underwriters or any of
them, because of any failure or refusal on the part of the Corporation to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Corporation shall be unable to perform its obligations under this
Agreement, the Corporation will reimburse the Underwriters or such Underwriters
as have so terminated this Agreement, with respect to themselves, severally, for
all reasonable out-of-pocket expenses (including the fees and disbursements of
their counsel) reasonably incurred by such Underwriters in connection with the
Offered Securities.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
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<PAGE>
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
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<PAGE>
EXHIBIT A
---------
The opinion of Sullivan & Cromwell, as special counsel to the
Offerors, to be delivered pursuant to Article IV, paragraph (b) of this
Agreement shall be to the effect that:
1. This Agreement has been duly authorized, executed and delivered
by the Corporation.
2. The Declaration of Trust has been duly authorized, executed and
delivered by the Corporation and duly qualified under the Trust Indenture Act of
1939.
3. The Guarantee Agreement has been duly authorized, executed and
delivered by the Corporation and duly qualified under the Trust Indenture Act of
1939; and the Guarantee Agreement constitutes a valid and legally binding
obligation of the Corporation enforceable in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
4. The Indenture has been duly authorized, executed and delivered by
the Corporation and duly qualified under the Trust Indenture Act of 1939; the
Junior Subordinated Debentures have been duly authorized, executed,
authenticated and delivered; and the Indenture and the Junior Subordinated
Debentures constitute valid and legally binding obligations of the Corporation
enforceable in accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles.
5. The Trust is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in Investment
Company Act.
6. The statements set forth in the Prospectus Supplement under the
captions "Certain Terms of Preferred Securities", "Certain Terms of Subordinated
Debentures" and "Certain Terms of Guarantee" and in the Prospectus under the
captions "Description of Preferred Securities", "Description of Junior
Subordinated Debentures", "Description of Guarantees" and "Relationship Among
the Preferred Securities, the Corresponding Junior Subordinated
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Debentures, the Guarantees and the Expense Agreements", insofar as such
statements purport to describe the provisions of the laws and documents referred
to therein, fairly present the matters referred to therein.
In rendering such opinion, such counsel may rely as to certain matters
on information obtained from public officials, officers of the Offerors and
other sources believed by them to be responsible. Further, such counsel may
state that they do not express an opinion as to any laws other than the laws of
the State of New York and the Federal law of the United States of America. Such
counsel may also include such other exceptions and qualifications as may be
mutually agreed upon by such counsel and the Manager.
A-2
<PAGE>
EXHIBIT B
---------
The opinion of Gordon S. Calder, Jr., as counsel to the Offerors, to
be delivered pursuant to Article IV, paragraph (c) of this Agreement shall be to
the effect that:
1. The Corporation has been duly incorporated and is an existing
corporation in good standing under the laws of the State of New York, duly
registered as a bank holding company under the Bank Holding Company Act of 1956,
as amended, and has all requisite corporate power and authority to own its
properties and conduct its business as described in the Prospectus.
2. Bankers Trust Company has been duly incorporated, is an existing
banking corporation in good standing under the laws of the State of New York,
and has all requisite corporate power and authority to own its properties and
conduct its business as described in the Prospectus.
3. No consent, approval, authorization or order of any court or
governmental agency, authority or body is required for the consummation by the
Corporation of the transactions contemplated by this Agreement, it being
understood that such counsel expresses no opinion as to the securities or Blue
Sky laws of any jurisdiction.
4. The issuance and sale of the Preferred Securities by the Issuer
Trust and the execution, delivery and performance by the Corporation of this
Agreement will not contravene any applicable Federal or New York law or
regulation, the certificate of incorporation or by-laws of the Corporation, or
to such counsel's knowledge, any agreement or other instrument binding upon the
Corporation, subject in each case to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles, it
being understood that such counsel expresses no opinion as to the securities or
Blue Sky laws of any jurisdiction.
Such counsel shall further state that each part of the Registration
Statement, when such part became effective, and the Prospectus, as of the date
of the Prospectus Supplement, appeared on their face to be appropriately
responsive, in all material respects, to the requirements of the Securities Act
and the applicable rules and regulations of the Commission thereunder; and that
nothing has come to
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his attention that has caused him to believe that the Registration Statement, as
of its effective date, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus, as of the
date of the Prospectus Supplement, contained any untrue statement of a material
fact or omitted to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; it being understood that such counsel need express no
opinion as to the financial statements or other data of a financial or
statistical nature or the Statements of Eligibility (Forms T-1) under the Trust
Indenture Act of 1939, as amended, included in the Registration Statement.
In rendering such opinion, such counsel may rely as to certain matters
on information obtained from public officials, officers of the Offerors and
other sources believed by him to be responsible. Further, such counsel may
state that he does not express an opinion as to any laws other than the laws of
the State of New York and the Federal law of the United States of America. Such
counsel may also include such other exceptions and qualifications as may be
mutually agreed upon by such counsel and the Manager.
B-2
<PAGE>
EXHIBIT C
---------
The opinion of Sullivan & Cromwell, as special tax counsel to the
Offerors, to be delivered pursuant to Article IV, paragraph (d) of this
Agreement shall confirm the opinion set forth in the Prospectus Supplement under
the heading "Certain Federal Income Tax Consequences".
In rendering such opinion, such counsel may assume that the operative
documents for the Preferred Securities described in the Prospectus will be
performed in accordance with the terms described therein. Such counsel may also
include such other exceptions and qualifications as may be mutually agreed upon
by such counsel and the Manager.
C-1
<PAGE>
EXHIBIT D
---------
The opinion of Richards, Layton & Finger, as special Delaware counsel
to the Offerors, to be delivered pursuant to Article IV, paragraph (e) of this
Agreement shall be to the effect that:
1. The Issuer Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, all filings required
under the laws of the State of Delaware with respect to the creation and valid
existence of the Issuer Trust as a business trust have been made, and, under the
Delaware Act and the Declaration of Trust, the Issuer Trust has the requisite
trust power and authority to conduct its business as presently conducted and as
described in the Prospectus.
2. No authorization, approval, consent or order of any Delaware court
or governmental authority or agency is required to be obtained by the Issuer
Trust solely in connection with the execution, delivery and performance by the
Issuer Trust of this Agreement or the consummation by the Issuer Trust of the
transactions contemplated thereby.
3. The issuance and sale by the Issuer Trust of the Preferred
Securities, the execution, delivery and performance by the Issuer Trust of this
Agreement and the consummation by the Issuer Trust of the transactions
contemplated thereby will not (i) violate any of the provisions of the
Certificate of Trust of the Issuer Trust, the Guarantee Agreement, the
Indenture, the Junior Subordinated Debentures or the Declaration of Trust, (ii)
violate any judgments, orders or decrees of any court of the State of Delaware,
(iii) violate any applicable Delaware law or administrative regulation, or (iv)
to our knowledge after consultation with the Property Trustee and the
Corporation, as depositor of the Issuer Trust, conflict with or result in a
breach of, or violation of any of the provisions of, or constitute a default
under, any agreement to which the Issuer Trust is a party.
4. Under the Delaware Act and the Declaration of Trust, the Issuer
Trust has the requisite power and authority to execute and deliver, and to
perform its obligations under, this Agreement and the Expense Agreement, and the
execution and delivery by the Issuer Trust of this Agreement and the Expense
Agreement and the performance of its obligations hereunder and thereunder have
been duly
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authorized by the requisite trust action on the part of the Issuer Trust.
5. The Preferred Securities have been duly authorized by the
Declaration of Trust and, upon the execution of the certificate evidencing the
Preferred Securities by an Administrative Trustee on behalf of the Issuer Trust,
will have been duly executed by the Issuer Trust and, when duly issued,
delivered and paid for in accordance with this Agreement, will be validly issued
and, subject to the qualifications set forth in this paragraph 5, fully paid and
nonassessable beneficial interests in the assets of the Issuer Trust. The
Holders of the Preferred Securities, as beneficial owners of the Issuer Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Holders of the
Preferred Securities may be obligated, pursuant to the Declaration of Trust, to
(i) provide indemnity or security in connection with and pay taxes or
governmental charges arising from transfers or exchanges of Preferred Securities
Certificates and the issuance of Preferred Securities Certificates and (ii)
provide indemnity or security in connection with requests of or directions to
the Property Trustee to exercise its rights and remedies under the Declaration
of Trust. Under Delaware law and the Declaration of Trust, the issuance of the
Preferred Securities is not subject to preemptive rights.
In rendering such opinion, such counsel may rely as to certain matters
on information obtained from public officials, officers of the Offerors and
other sources believed by them to be responsible. Further, such counsel may
state that they do not express an opinion as to any laws other than the laws of
the State of Delaware. Such counsel may also include such other exceptions and
qualifications as may be mutually agreed upon by such counsel and the Manager.
D-2
<PAGE>
EXHIBIT E
---------
The opinion of Richards, Layton & Finger, as counsel to the Property
Trustee, the Delaware Trustee, the Guarantee Trustee and the Debenture Trustee,
to be delivered pursuant to Article IV, paragraph (f) of this Agreement shall be
to the effect that:
1. Wilmington Trust Company is duly incorporated and is validly
existing in good standing as a banking corporation with trust powers under the
laws of the State of Delaware.
2. The Indenture Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Indenture, and has taken
all necessary corporate action to authorize the execution, delivery and
performance by it of the Indenture.
3. The Guarantee Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the Guarantee Agreement, and
has taken all necessary corporate action to authorize the execution, delivery
and performance by it of the Guarantee.
4. The Property Trustee has the requisite power and authority to
execute and deliver the Declaration of Trust, and has taken all necessary
corporate action to authorize the execution and delivery of the Declaration of
Trust.
5. The Delaware Trustee has the requisite power and authority to
execute and deliver the Declaration of Trust, and has taken all necessary
corporate action to authorize the execution and delivery of the Declaration of
Trust.
6. Each of the Indenture, the Guarantee Agreement and the
Declaration of Trust has been duly executed and delivered by the Debenture
Trustee, the Guarantee Trustee, and the Property Trustee and Delaware Trustee,
respectively, and constitutes a legal, valid and binding obligation of the
Debenture Trustee, the Guarantee Trustee, and the Property Trustee and Delaware
Trustee, respectively, enforceable against the Debenture Trustee, the Guarantee
Trustee, and the Property Trustee and Delaware Trustee, respectively, in
accordance with its respective terms, except that certain payment obligations
may be enforceable solely against the assets of the Corporation or
E-1
<PAGE>
the Issuer Trust, as applicable, and except that such enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium, liquidation, fraudulent
conveyance and transfer or other similar laws applicable to Delaware banking
corporations affecting the enforcement of creditors' rights generally, and by
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
7. The Subordinated Debentures delivered on the date hereof have
been duly authenticated by the Debenture Trustee in accordance with the terms of
the Indenture.
In rendering such opinion, such counsel may rely as to certain matters
on information obtained from public officials, officers of the Offerors, the
Debenture Trustee, Guarantee Trustee, Property Trustee and Delaware Trustee and
other sources believed by them to be responsible. Further, such counsel may
state that they do not express an opinion as to any laws other than the laws of
the State of Delaware. Such counsel may also include such other exceptions and
qualifications as may be mutually agreed upon by such counsel and the Manager.
E-2
<PAGE>
EXHIBIT F
---------
The opinion of White & Case, as counsel to the Underwriters, to be
delivered pursuant to Article IV, paragraph (g) of this Agreement shall be to
the effect that:
1. The Corporation has been duly incorporated and is validly
existing in good standing under the laws of the State of New York.
2. The Indenture has been duly authorized, executed and delivered by
the Corporation; the Indenture has been duly qualified under the Trust Indenture
Act of 1939; the Subordinated Debentures have been duly authorized, executed,
authenticated, issued and delivered; and the Indenture and the Subordinated
Debentures are valid, legal and binding obligations of the Corporation
enforceable in accordance with their terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law).
3. The Guarantee Agreement and the Declaration of Trust have been
duly authorized, executed and delivered by the Corporation; the Guarantee
Agreement and the Declaration of Trust have been duly qualified under the Trust
Indenture Act of 1939; the Guarantee Agreement is a valid, legal and binding
obligation of the Corporation enforceable in accordance with its terms, except
as the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors'
rights generally and by general equitable principles (regardless of whether the
issue of enforceability is considered in a proceeding in equity or at law).
4. This Agreement has been duly authorized, executed and delivered
by the Issuer Trust and the Corporation.
5. The Indenture, the Subordinated Debentures, the Guarantee
Agreement, the Declaration and the Preferred Securities conform in all material
respects to the statements relating thereto contained in the Offering Circular.
F-1
<PAGE>
6. The Registration Statement has become effective, and to the best
of such counsel's knowledge, no stop order suspending the effectiveness of the
Registration Statement is in effect and no proceedings for that purpose have
been instituted or are pending or are threatened under the Securities Act.
Based upon such counsel's participation in the preparation of the
Registration Statement and Prospectus, but without independent check or
verification, and subject to certain other qualifications, (i) in such counsel's
opinion, each of the Registration Statement at the time of effectiveness and the
Prospectus as of its date (except for the financial statements and other
financial and statistical data included or incorporated by reference therein or
omitted therefrom, and other than the trustees' respective Statements of
Eligibility on Form T-1, as to which such counsel need express no opinion)
appears on its face to comply as to form in all material respects with the
require ments of the Securities Act and the rules and regulations of the
Commission thereunder; (ii) such counsel does not know of any legal or
governmental proceeding to which the Company is a party or to which it or its
properties are subject which is required to be described in the Registration
Statement which is not described as required, or of any contract or document of
a character required to be described or summarized in the Registration Statement
or to be filed as an exhibit to the Registration Statement which is not so
described, summarized or filed, and (iii) nothing has come to the attention of
such counsel which would cause such counsel to believe that (a) as of its
effective date the Registration Statement (other than the financial statements
and related schedules and other financial and statistical data included or
incorporated by reference therein or omitted therefrom, and other than the
trustees' respective Statements of Eligibility on Form T-1, as to which such
counsel need express no opinion) contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (b) as of its date the
Prospectus, as amended or supplemented, (other than the financial statements and
related schedules and other financial and statistical data included or
incorporated by reference therein or omitted therefrom, as to which we express
no belief) contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or (c) as of the date hereof either the Registration
Statement or the Prospectus, as amended or supplemented (other than the
financial statements
F-2
<PAGE>
and related schedules and other financial and statistical data included or
incorporated by reference therein or omitted therefrom, and other than the
trustees' respective Statements of Eligibility on Form T-1, as to which such
counsel need express no belief), contains an untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading.
In rendering such opinion, such counsel may rely upon an opinion or
opinions, each dated the Closing Date, of other counsel retained by them or by
the Offerors as to laws of any jurisdiction other than the United States or the
State of New York, provided that (i) such reliance is expressly authorized by
each opinion so relied upon and a copy of each such opinion is delivered to the
Manager, and (ii) such counsel shall state in their opinion that they believe
that they and the Manager are justified in relying thereon. Insofar as such
opinions involve factual matters, such counsel may rely, to the extent such
counsel deems proper, upon certificates of officers of the Corporation, its
subsidiaries and the Issuer Trust and certificates of public officials. Such
counsel may also include such other exceptions and qualifications as may be
mutually agreed upon by such counsel and the Manager.
F-3
<PAGE>
FORM OF UNDERWRITING AGREEMENT
Bankers Trust New York Corporation,
One Bankers Trust Plaza,
130 Liberty Street,
New York, New York 10006.
BT Preferred Capital Trust [I/II/III/IV],
c/o Bankers Trust New York Corporation,
One Bankers Trust Plaza,
130 Liberty Street,
New York, New York 10006.
Dear Sirs:
We [, as [sole] Underwriter[s]] [, as representative[s] of the several
Underwriters (the "Manager[s]")], understand that Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), and BT Preferred
Capital Trust [I/II/III/IV], a statutory business trust created under the laws
of Delaware (the "Issuer Trust"), propose to offer and sell, on the terms and
subject to the conditions set forth herein, ______________ of the __% Preferred
Securities, Series __ (Liquidation Amount $____ per Preferred Security") (the
"Preferred Securities") of the Issuer Trust, [to [us] [the Underwriters named in
Schedule I hereto (the "Underwriters")]. The terms of the Preferred Securities
are set forth in the Registration Statement and Basic Prospectus referred to in
the provisions incorporated herein by reference, as supplemented by a Prospectus
Supplement dated ___________ ___, 19__.
All the provisions contained in the document entitled Bankers Trust
New York Corporation-BT Preferred Capital Trust I, II, III and IV Preferred
Securities Underwriting Agreement Standard Provisions (January 1997) (including
the definition therein of certain terms), a copy of which you have previously
received, are herein incorporated by reference in their entirety and shall be
deemed to be a part of this Agreement to the same extent as if such provisions
had been set forth in full herein.
Subject to the terms and conditions set forth herein or incorporated
by reference herein, the Issuer Trust hereby agrees to sell and [we hereby
agree] [each of the Underwriters hereby agrees, severally and not jointly] to
purchase [the Preferred Securities] [the number of Preferred Securities set
forth opposite the name of such Underwriter in Schedule I hereto] at a purchase
price of ____$ of their
<PAGE>
-2-
liquidation amount, plus accrued distributions, if any, from the date of
original issuance to the date of payment and delivery.
We will pay for the Offered Securities upon delivery thereof at the
offices of the Corporation, One Bankers Trust Plaza, 130 Liberty Street, New
York, New York 10006, at 10:00 A.M. (New York City time) on ________, __ 19__ or
at such other time, not later than, ________, __ 19__, as shall be designated by
us, such time being referred to herein as the "Closing Date".
[The certificates for the Preferred Securities shall be registered in
such names and in such denominations as we shall request and shall be available
for checking and packaging at the above office of the Corporation at least 24
hours prior to the Closing Date.]
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the
<PAGE>
-3-
space set forth below and by returning the signed copy to us.
Very truly yours,
[UNDERWRITER[S]]
[MANAGER[S],]
[As representatives of the
Several Underwriters named in
Schedule I hereto]
By:____________________________
Title:
Accepted:
BANKERS TRUST NEW YORK CORPORATION
By:___________________________________
Name:
Title:
BT PREFERRED CAPITAL TRUST [I/II/III/IV]
By: BANKERS TRUST NEW YORK CORPORATION,
as Depositor
By:___________________________________
Name:
Title:
<PAGE>
-4-
Schedule I
Number of
Name of Underwriter Preferred Securities
------------------- --------------------
<PAGE>
EXHIBIT 5.1
[Sullivan & Cromwell Letterhead]
January 30, 1997
Bankers Trust New York Corporation,
130 Liberty Street,
One Bankers Trust Plaza,
New York, New York 10006.
BT Preferred Capital Trusts I, II, III and IV
c/o Bankers Trust New York Corporation,
130 Liberty Street,
One Bankers Trust Plaza,
New York, New York 10006.
Ladies and Gentlemen:
In connection with the registration under the Securities Act of 1933
(the "Act") of $580,000,000 aggregate principal amount of Junior Subordinated
Deferrable Interest Debentures (the "Junior Subordinated Debentures") of Bankers
Trust New York Corporation, a New York corporation (the "Corporation"),
$580,000,000 aggregate liquidation amount of Preferred Securities (the
"Preferred Securities") to be issued by BT Preferred Capital Trusts I, II, III
and IV, each a statutory business trust created under the laws of the State of
Delaware (each, an "Issuer Trust"), and the Guarantees related to the Preferred
Securities issued by each Issuer Trust (each, a "Guarantee") to be executed and
<PAGE>
Bankers Trust New York Corporation -2-
delivered by the Corporation for the benefit of the holders from time to time of
such Preferred Securities, we, as your special counsel, have examined such
corporate records, certificates and other documents, and such questions of law,
as we have considered necessary or appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, in our
opinion:
(i) When the Registration Statement relating to the Junior
Subordinated Debentures, the Preferred Securities and the Guarantees (the
"Registration Statement") has become effective under the Act, the indenture
relating to the Junior Subordinated Debentures (the "Junior Subordinated
Indenture") has been duly executed and delivered, the terms of a series of
the Junior Subordinated Debentures and of their issuance and sale have been
duly established in conformity with the Junior Subordinated Indenture so as
not to violate any applicable law or result in a default under or breach of
any agreement or instrument binding upon the Corporation and so as to
comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the Corporation, and such Junior
Subordinated Debentures
<PAGE>
Bankers Trust New York Corporation -3-
have been duly executed and authenticated in accordance with the Junior
Subordinated Indenture and issued and delivered as contemplated in the
Registration Statement, such Junior Subordinated Debentures will constitute
valid and legally binding obligations of the Corporation, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
(ii) When the Registration Statement has become effective under the
Act, the Guarantee with respect to the Preferred Securities of an Issuer
Trust has been duly executed and delivered, such Preferred Securities have
been duly executed in accordance with the Amended and Restated Declaration
of Trust of such Issuer Trust and issued and delivered as contemplated in
the Registration Statement, the terms of such Guarantee and of its
issuance and delivery have been duly established so as not to violate any
applicable law or result in a default under or breach of any agreement or
instrument binding upon the Corporation and so as to comply with any
requirement or restriction imposed by any court or governmental body having
jurisdiction over
<PAGE>
Bankers Trust New York Corporation -4-
the Corporation, and the terms of the Preferred Securities of such Issuer
Trust and of their issuance and delivery have been duly established in
conformity with the Amended and Restated Declaration of Trust of such
Issuer Trust so as not to violate any applicable law or result in a default
under or breach of any agreement or instrument binding upon such Issuer
Trust and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over such Issuer Trust,
such Guarantee will constitute a valid and legally binding obligation of
the Corporation, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
The foregoing opinion is limited to the Federal laws of the United
States and the laws of the State of New York, and we are expressing no opinion
as to the effect of the laws of any other jurisdiction.
We understand that you have received an opinion regarding the
Preferred Securities from Richards, Layton & Finger, LLP, special Delaware
counsel for the Corporation
<PAGE>
Bankers Trust New York Corporation -5-
and the Issuer Trusts. We are expressing no opinion with respect to the matters
contained in such opinion.
We have relied as to certain matters on information obtained from
public officials, officers of the Corporation and the Issuer Trusts and other
sources believed by us to be responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Validity
of Securities" in the Prospectus. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Act.
Very truly yours,
/s/ Sullivan & Cromwell
<PAGE>
Exhibit 5.2
[Letterhead of Richards, Layton & Finger]
January 27, 1997
BT Preferred Capital Trust I
c/o Bankers Trust New York Corporation
130 Liberty Street
New York, New York 10006
Re: BT Preferred Capital Trust I
----------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), and BT Preferred
Capital Trust I, a Delaware business trust (the "Trust"), in connection with the
matters set forth herein. At your request, this opinion is being furnished to
you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of October 28,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on October 29, 1996;
(b) The Declaration of Trust of the Trust, dated October 28, 1996,
between the Corporation, as depositor, and Wilmington Trust Company, a Delaware
banking corporation, as trustee of the Trust;
(c) The registration statement (the "Initial Registration Statement")
on Form S-3 (Registration No. 333-15089), filed by the Corporation, the Trust
and the other registrants listed therein with the Securities and Exchange
Commission (the "SEC") on October 30, 1996, as amended by Amendment No. 1 to the
Initial
<PAGE>
BT Preferred Capital Trust I
January 27, 1997
Page 2
Registration Statement, filed by the Corporation, the Trust and the other
registrants listed therein with the SEC on January 23, 1997 ("Amendment No. 1"),
and Amendment No. 2 to the Initial Registration Statement, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Preferred Trust Securities
of the Trust representing preferred undivided beneficial interests in the assets
of the Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), as proposed to be filed by the Corporation, the Trust and the
other registrants listed therein with the SEC on or about January 27, 1997
("Amendment No. 2") (the Initial Registration Statement as amended by Amendment
No. 1 and Amendment No. 2 is hereinafter referred to as the "Registration
Statement");
(d) A form of Amended and Restated Declaration of Trust of the Trust,
among the Corporation, the trustees of the Trust named therein, and the holders,
from time to time, of undivided beneficial interests in the assets of the Trust,
attached to the Prospectus as Exhibit "A" (the "Declaration"); and
(e) A Certificate of Good Standing for the Trust, dated January 27,
1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists no
provision in any document that we have not reviewed that bears upon or is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have
<PAGE>
BT Preferred Capital Trust I
January 27, 1997
Page 3
not been amended, (ii) except to the extent provided in paragraph 1 below, the
due creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a Preferred Securities
Certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Declaration and the Registration
Statement, and (vii) that the Preferred Securities are issued and sold to the
Preferred Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
-------
(S) 3801, et seq.
-- ---
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation
<PAGE>
BT Preferred Capital Trust I
January 27, 1997
Page 4
Law of the State of Delaware. We note that the Preferred Security Holders may
be obligated to make payments as set forth in the Declaration.
We understand that Sullivan & Cromwell ("Sullivan") will rely as to
matters of Delaware law upon this opinion in connection with an opinion to be
rendered by it on the date hereof relating to the Trust. In connection with the
foregoing, we hereby consent to Sullivan's relying as to matters of Delaware law
upon this opinion. Furthermore, we consent to the filing of this opinion with
the SEC as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the SEC
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/S/
Richards, Layton & Finger
MIL/DAF/sc
<PAGE>
Exhibit 5.3
[Letterhead of Richards, Layton & Finger]
January 27, 1997
BT Preferred Capital Trust II
c/o Bankers Trust New York Corporation
130 Liberty Street
New York, New York 10006
Re: BT Preferred Capital Trust II
-----------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), and BT Preferred
Capital Trust II, a Delaware business trust (the "Trust"), in connection with
the matters set forth herein. At your request, this opinion is being furnished
to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of October 28,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on October 29, 1996;
(b) The Declaration of Trust of the Trust, dated October 28, 1996,
between the Corporation, as depositor, and Wilmington Trust Company, a Delaware
banking corporation, as trustee of the Trust;
(c) The registration statement (the "Initial Registration Statement")
on Form S-3 (Registration No. 333-15089), filed by the Corporation, the Trust
and the other registrants listed therein with the Securities and Exchange
Commission (the "SEC") on October 30, 1996, as amended by Amendment No. 1 to the
Initial
<PAGE>
BT Preferred Capital Trust II
January 27, 1997
Page 2
Registration Statement, filed by the Corporation, the Trust and the other
registrants listed therein with the SEC on January 23, 1997 ("Amendment No. 1"),
and Amendment No. 2 to the Initial Registration Statement, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Preferred Trust Securities
of the Trust representing preferred undivided beneficial interests in the assets
of the Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), as proposed to be filed by the Corporation, the Trust and the
other registrants listed therein with the SEC on or about January 27, 1997
("Amendment No. 2") (the Initial Registration Statement as amended by Amendment
No. 1 and Amendment No. 2 is hereinafter referred to as the "Registration
Statement");
(d) A form of Amended and Restated Declaration of Trust of the Trust,
among the Corporation, the trustees of the Trust named therein, and the holders,
from time to time, of undivided beneficial interests in the assets of the Trust,
attached to the Prospectus as Exhibit "A" (the "Declaration"); and
(e) A Certificate of Good Standing for the Trust, dated January 27,
1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists no
provision in any document that we have not reviewed that bears upon or is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have
<PAGE>
BT Preferred Capital Trust II
January 27, 1997
Page 3
not been amended, (ii) except to the extent provided in paragraph 1 below, the
due creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a Preferred Securities
Certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Declaration and the Registration
Statement, and (vii) that the Preferred Securities are issued and sold to the
Preferred Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
-------
(S) 3801, et seq.
-- ---
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation
<PAGE>
BT Preferred Capital Trust II
January 27, 1997
Page 4
Law of the State of Delaware. We note that the Preferred Security Holders may
be obligated to make payments as set forth in the Declaration.
We understand that Sullivan & Cromwell ("Sullivan") will rely as to
matters of Delaware law upon this opinion in connection with an opinion to be
rendered by it on the date hereof relating to the Trust. In connection with the
foregoing, we hereby consent to Sullivan's relying as to matters of Delaware law
upon this opinion. Furthermore, we consent to the filing of this opinion with
the SEC as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the SEC
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/S/
Richards, Layton & Finger
MIL/DAF/sc
<PAGE>
Exhibit 5.4
[Letterhead of Richards, Layton & Finger]
January 27, 1997
BT Preferred Capital Trust III
c/o Bankers Trust New York Corporation
130 Liberty Street
New York, New York 10006
Re: BT Preferred Capital Trust III
------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), and BT Preferred
Capital Trust III, a Delaware business trust (the "Trust"), in connection with
the matters set forth herein. At your request, this opinion is being furnished
to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of October 28,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on October 29, 1996;
(b) The Declaration of Trust of the Trust, dated October 28, 1996,
between the Corporation, as depositor, and Wilmington Trust Company, a Delaware
banking corporation, as trustee of the Trust;
(c) The registration statement (the "Initial Registration Statement")
on Form S-3 (Registration No. 333-15089), filed by the Corporation, the Trust
and the other registrants listed therein with the Securities and Exchange
Commission (the "SEC") on October 30, 1996, as amended by Amendment No. 1 to the
Initial
<PAGE>
BT Preferred Capital Trust III
January 27, 1997
Page 2
Registration Statement, filed by the Corporation, the Trust and the other
registrants listed therein with the SEC on January 23, 1997 ("Amendment No. 1"),
and Amendment No. 2 to the Initial Registration Statement, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Preferred Trust Securities
of the Trust representing preferred undivided beneficial interests in the assets
of the Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), as proposed to be filed by the Corporation, the Trust and the
other registrants listed therein with the SEC on or about January 27, 1997
("Amendment No. 2") (the Initial Registration Statement as amended by Amendment
No. 1 and Amendment No. 2 is hereinafter referred to as the "Registration
Statement");
(d) A form of Amended and Restated Declaration of Trust of the Trust,
among the Corporation, the trustees of the Trust named therein, and the holders,
from time to time, of undivided beneficial interests in the assets of the Trust,
attached to the Prospectus as Exhibit "A" (the "Declaration"); and
(e) A Certificate of Good Standing for the Trust, dated January 27,
1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists no
provision in any document that we have not reviewed that bears upon or is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have
<PAGE>
BT Preferred Capital Trust III
January 27, 1997
Page 3
not been amended, (ii) except to the extent provided in paragraph 1 below, the
due creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a Preferred Securities
Certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Declaration and the Registration
Statement, and (vii) that the Preferred Securities are issued and sold to the
Preferred Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
-------
(S) 3801, et seq.
-- ---
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the
Trust, will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation
<PAGE>
BT Preferred Capital Trust III
January 27, 1997
Page 4
Law of the State of Delaware. We note that the Preferred Security Holders may
be obligated to make payments as set forth in the Declaration.
We understand that Sullivan & Cromwell ("Sullivan") will rely as to
matters of Delaware law upon this opinion in connection with an opinion to be
rendered by it on the date hereof relating to the Trust. In connection with the
foregoing, we hereby consent to Sullivan's relying as to matters of Delaware law
upon this opinion. Furthermore, we consent to the filing of this opinion with
the SEC as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the SEC
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/S/
Richards, Layton & Finger
MIL/DAF/sc
<PAGE>
Exhibit 5.5
[Letterhead of Richards, Layton & Finger]
January 27, 1997
BT Preferred Capital Trust IV
c/o Bankers Trust New York Corporation
130 Liberty Street
New York, New York 10006
Re: BT Preferred Capital Trust IV
-----------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Bankers Trust New York
Corporation, a New York corporation (the "Corporation"), and BT Preferred
Capital Trust IV, a Delaware business trust (the "Trust"), in connection with
the matters set forth herein. At your request, this opinion is being furnished
to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of October 28,
1996 (the "Certificate"), as filed in the office of the Secretary of State of
the State of Delaware (the "Secretary of State") on October 29, 1996;
(b) The Declaration of Trust of the Trust, dated October 28, 1996,
between the Corporation, as depositor, and Wilmington Trust Company, a Delaware
banking corporation, as trustee of the Trust;
(c) The registration statement (the "Initial Registration Statement")
on Form S-3 (Registration No. 333-15089), filed by the Corporation, the Trust
and the other registrants listed therein with the Securities and Exchange
Commission (the "SEC") on October 30, 1996, as amended by Amendment No. 1 to the
Initial
<PAGE>
BT Preferred Capital Trust IV
January 27, 1997
Page 2
Registration Statement, filed by the Corporation, the Trust and the other
registrants listed therein with the SEC on January 23, 1997 ("Amendment No. 1"),
and Amendment No. 2 to the Initial Registration Statement, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Preferred Trust Securities
of the Trust representing preferred undivided beneficial interests in the assets
of the Trust (each, a "Preferred Security" and collectively, the "Preferred
Securities"), as proposed to be filed by the Corporation, the Trust and the
other registrants listed therein with the SEC on or about January 27, 1997
("Amendment No. 2") (the Initial Registration Statement as amended by Amendment
No. 1 and Amendment No. 2 is hereinafter referred to as the "Registration
Statement");
(d) A form of Amended and Restated Declaration of Trust of the Trust,
among the Corporation, the trustees of the Trust named therein, and the holders,
from time to time, of undivided beneficial interests in the assets of the Trust,
attached to the Prospectus as Exhibit "A" (the "Declaration"); and
(e) A Certificate of Good Standing for the Trust, dated January 27,
1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed above, and we have assumed that there exists no
provision in any document that we have not reviewed that bears upon or is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Declaration
constitutes the entire agreement among the parties thereto with respect to the
subject matter thereof, including with respect to the creation, operation and
termination of the Trust, and that the Declaration and the Certificate are in
full force and effect and have
<PAGE>
BT Preferred Capital Trust IV
January 27, 1997
Page 3
not been amended, (ii) except to the extent provided in paragraph 1 below, the
due creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Preferred Security is to be issued by the Trust
(collectively, the "Preferred Security Holders") of a Preferred Securities
Certificate for such Preferred Security and the payment for the Preferred
Security acquired by it, in accordance with the Declaration and the Registration
Statement, and (vii) that the Preferred Securities are issued and sold to the
Preferred Security Holders in accordance with the Declaration and the
Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, 12 Del. C.
-------
(S) 3801, et seq.
-- ---
2. The Preferred Securities will represent valid and, subject to the
qualifications set forth in paragraph 3 below, fully paid and nonassessable
undivided beneficial interests in the assets of the Trust.
3. The Preferred Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation
<PAGE>
BT Preferred Capital Trust IV
January 27, 1997
Page 4
Law of the State of Delaware. We note that the Preferred Security Holders may
be obligated to make payments as set forth in the Declaration.
We understand that Sullivan & Cromwell ("Sullivan") will rely as to
matters of Delaware law upon this opinion in connection with an opinion to be
rendered by it on the date hereof relating to the Trust. In connection with the
foregoing, we hereby consent to Sullivan's relying as to matters of Delaware law
upon this opinion. Furthermore, we consent to the filing of this opinion with
the SEC as an exhibit to the Registration Statement. In addition, we hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus. In giving the foregoing consents, we do not thereby admit that we
come within the category of Persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the SEC
thereunder. Except as stated above, without our prior written consent, this
opinion may not be furnished or quoted to, or relied upon by, any other Person
for any purpose.
Very truly yours,
/S/
Richards, Layton & Finger
MIL/DAF/sc
<PAGE>
Exhibit 8.1
[Letterhead of Sullivan & Cromwell]
January 30, 1997
Bankers Trust New York Corporation,
One Bankers Trust Plaza,
New York, New York 10006.
BT Preferred Capital Trust I,
c/o Bankers Trust New York Corporation,
One Bankers Trust Plaza,
New York, New York 10006.
Ladies and Gentlemen:
As special tax counsel to BT Preferred Capital Trust I, a statutory
business trust formed under the laws of Delaware (the "Issuer Trust"), and
Bankers Trust New York Corporation, a New York corporation, in connection with
the issuance by the Issuer Trust of the __% Preferred Securities, Series I (the
"Preferred Securities"), and assuming that the operative documents for the
Preferred Securities described in the Prospectus and the Prospectus Supplement
forming a part of the Registration Statement to which this opinion is filed as
an exhibit (the "Registration Statement") will be performed in accordance with
the terms described therein, we hereby confirm to you our opinion as set forth
under the heading "Certain Federal Income Tax
<PAGE>
Bankers Trust New York Corporation
BT Preferred Capital Trust I -2-
Consequences" in the Prospectus Supplement, subject to the limitations set forth
therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and the reference to us under the heading "Certain
Federal Income Tax Consequences" in the Registration Statement. By giving the
foregoing consent, we do not admit that we come within the category of persons
whose consent is required under Section 7 of the Securities Act of 1933, as
amended, or the rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Sullivan & Cromwell
<PAGE>
EXHIBIT 12(1)
BANKERS TRUST NEW YORK CORPORATION AND SUBSIDIARIES
COMPUTATION OF CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
(dollars in millions)
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------------
1992 1993 1994 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Earnings:
1. Income before income taxes and
cumulative effects of accounting changes $ 906 $ 1,550 $ 869 $ 311 $ 872
2. Add: Fixed charges excluding capitalized
interest (Line 10) 3,099 3,148 3,884 5,095 5,499
3. Less: Equity in undistributed income of
unconsolidated subsidiaries and affiliates 40 30 45 28 30
------- ------- ------ ------ ------
4. Earnings including interest on deposits 3,965 4,668 4,708 5,378 6,341
5. Less: Interest on deposits 1,119 1,013 965 1,360 1,355
------- ------- ------ ------ ------
6. Earnings excluding interest on deposits $ 2,846 $ 3,655 $ 3,743 $ 4,018 $4,986
======= ======= ======= ======= ======
Fixed Charges:
7. Interest Expense $3,072 $3,122 $3,858 $5,069 $5,473
8. Estimated interest
component of net
rental expense 27 26 26 26 26
9. Amortization of debt
issuance expense - - - - -
------- ------- ------ ------ ------
10. Total fixed charges
including interest on
deposits and excluding
capitalized interest 3,099 3,148 3,884 5,095 5,499
11. Add: Capitalized
interest - - - - -
------- ------- ------ ------ ------
12. Total fixed charges 3,099 3,148 3,884 5,095 5,499
13. Less: Interest on
deposits
(Line 5) 1,119 1,013 965 1,360 1,355
------- ------- ------ ------ ------
14. Fixed charges excluding
interest on deposits $1,980 $2,135 $2,919 $3,735 $4,144
====== ====== ====== ====== ======
Consolidated Ratios of Earnings
to Fixed Charges:
Including interest on
deposits
(Line 4/Line 12) 1.28 1.48 1.21 1.06 1.15
====== ====== ====== ====== ======
Excluding interest on
deposits
(Line 6/Line 14) 1.44 1.71 1.28 1.08 1.20
====== ====== ====== ====== ======
</TABLE>
<PAGE>
EXHIBIT 12 (2)
BANKERS TRUST NEW YORK CORPORATION AND SUBSIDIARIES
COMPUTATION OF CONSOLIDATED RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
(dollars in millions)
<TABLE>
<CAPTION>
Year Ended December 31,
-------------------------------------------------------
1992 1993 1994 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Earnings:
1. Income before
income taxes and
cumulative effect
of accounting
changes $ 906 $ 1,550 $ 869 $ 311 $ 872
2. Add: Fixed charges
excluding
capitalized
interest
(Line 13) 3,099 3,148 3,884 5,095 5,499
3. Less: Equity in undistri-
buted income of
unconsolidated
subsidiaries and
affiliates 40 30 45 28 30
------ ----- ----- ----- ------
4. Earnings including
interest on deposits 3,965 4,668 4,708 5,378 6,341
5. Less: Interest on
deposits 1,119 1,013 965 1,360 1,355
------ ----- ----- ----- ------
6. Earnings excluding
interest on deposits $ 2,846 $ 3,655 $ 3,743 $ 4,018 $ 4,986
======= ======= ======= ======= =======
Preferred Stock Dividend Requirements:
7. Preferred stock dividend
requirements $ 30 $ 23 $ 28 $ 51 $ 51
8. Ratio of income from
continuing operations
before income taxes to
income fROMm continuing
operations after income
taxes 142% 145% 141% 145% 142%
------ ----- ----- ----- ------
9. Preferred stock dividend
requirements on a pretax
basis $ 43 $ 33 $ 39 $ 74 $ 72
======= ====== ====== ======= =======
Fixed Charges:
10. Interest Expense $ 3,072 $ 3,122 $ 3,858 $5,069 $ 5,473
11. Estimated interest
component of net
rental expense 27 26 26 26 26
12. Amortization of debt
issuance expense - - - - -
------- ------ ------ ------ -------
13. Total fixed charges
including interest on
deposits and excluding
capitalized interest 3,099 3,148 3,884 5,095 5,499
14. Add: Capitalized
interest - - - - -
------- ------ ------ ------ -------
15. Total fixed charges 3,099 3,148 3,884 5,095 5,499
16. Add: Preferred stock
dividend require-
ments - pretax
(Line 9) 43 33 39 74 72
------- ------ ------ ------ -------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
17. Total combined fixed
charges and preferred
stock dividend require-
ments on a pretax
basis 3,142 3,181 3,923 5,169 5,571
18. Less: Interest on
deposits
(Line 5) 1,119 1,013 965 1,360 1,355
----- ----- ----- ----- -----
19. Combined fixed charges
and preferred stock
dividend requirements
on a pretax basis
excluding interest on
deposits $2,023 $2,168 $2,958 $3,809 $4,216
====== ====== ====== ====== ======
Consolidated Ratios of Earnings
to Combined Fixed Charges
and Preferred Stock
Dividend Requirements:
Including interest on
deposits
(Line 4/Line 17) 1.26 1.47 1.20 1.04 1.14
==== ==== ==== ==== ====
Excluding interest on
deposits
(Line 6/Line 19) 1.41 1.69 1.27 1.05 1.18
==== ==== ==== ==== ====
</TABLE>
