REQUEST TO TRANSMIT TO YOUR CLIENTS AND BROKERS
materials relating to the
Exchange Offers by Banco Santander, S.A. and
Santander Financial Exchanges Limited
Date: August , 2009
To: Reorganization and Corporate Action Departments
Expiration Date: September 23, 2009
Settlement Date: September 29, 2009
Re: Exchange Offers by Banco Santander, S.A. and Santander Financial Exchanges Limited
| Old Securities Group # 1 | | New Security #1 |
CUSIP / ISIN | Description | Amount Outstanding | FOR | CUSIP / ISIN | Description | Plus |
80281R300 / US80281R3003 | Santander Finance Preferred, S.A. Unipersonal 6.410% Non-Cumulative Guaranteed Series 1 Preferred Securities | 7,600,000 | E8683R 144 / USE8683R1448 | Up to 45,048,000 Santander Finance Preferred, S.A. Unipersonal 10.5% Non-Cumulative Guaranteed Series 10 Preferred Securities (par value $25 per security) fully and unconditionally guaranteed by Banco Santander, S.A. | a cash payment (including accrued but unpaid distributions, plus a cash exchange incentive payment up to an aggregate total amount of $197.3 million, plus cash amounts in lieu of any fractional exchange preferred securities) |
80281R706 / US80281R7061 | Santander Finance Preferred, S.A. Unipersonal 6.800% Non-Cumulative Guaranteed Series 4 Preferred Securities | 20,000,000 |
80281R805 / US80281R8051 | Santander Finance Preferred, S.A. Unipersonal 6.500% Non-Cumulative Guaranteed Series 5 Preferred Securities | 24,000,000 |
80281R888 / US80281R8887 | Santander Finance Preferred, S.A. Unipersonal Floating Rate (U.S. dollar three-month LIBOR plus 0.52%) Non-Cumulative Guaranteed Series 6 Preferred Securities | 14,000,000 |
| Old Securities #2 | | New Security #2 |
CUSIP / ISIN | Description | Amount Outstanding | FOR | CUSIP / ISIN | Description | Plus |
845905405 / US8459054057 | Sovereign Bancorp, Inc. 7.300% Depositary Shares (liquidation preference $25 per security), each representing a 1/1,000th interest in a Share of Series C Non-Cumulative Perpetual Preferred Stock of Sovereign Bancorp, Inc | 8,000,000 | E8683R 144 / | Up to 6,400,000 Santander Finance Preferred, S.A. Unipersonal 10.5% Non-Cumulative Guaranteed Series 10 Preferred Securities (par value $25 per security) fully and unconditionally guaranteed by Banco Santander, S.A. | plus, a cash payment (including accrued but unpaid distributions, plus a cash exchange incentive payment up to an aggregate total amount of $20.0 million, plus cash amounts in lieu of any fractional exchange preferred securities) |
CUSIP / ISIN | Description | Amount Outstanding | | CUSIP / ISIN | Description | Plus |
002927AA9 / US002927AA95 | Abbey National Capital Trust I 8.963% Non-Cumulative Guaranteed Trust Preferred Securities (liquidation preference $1,000 per security) guaranteed by Abbey National plc and issued on February 7, 2000 | 1,000,000 | 80281R AC6 / US80281RAC60 | Up to 800,000 Santander Finance Preferred, S.A. Unipersonal Fixed-to-Floating Non-Cumulative Guaranteed Series 11 Preferred Securities (par value $1,000 per security) fully and unconditionally guaranteed by Banco Santander, S.A. | plus, a cash payment (including accrued but unpaid distributions, plus a cash exchange incentive payment up to an aggregate total amount of $100.0 million, plus cash amounts in lieu of any fractional exchange preferred securities) |
The enclosed materials describe exchange offers for the above-referenced old securities (the “existing preferred securities”).
The exchange offer for each series of existing preferred securities and the withdrawal rights for that series will expire at 5:00 P.M., New York City time, on September 23, 2009, or the “Exchange Offer Deadline,” unless extended for that series. Existing preferred securities tendered pursuant to the exchange offer may be withdrawn at any time prior to the Exchange Offer Deadline for those securities, but not during any subsequent offer period. The offerors are not providing for guaranteed delivery procedures and therefore you must allow sufficient time for the necessary tender procedures to be completed during normal business hours of The Depository Trust Company (“DTC”) prior to the Exchange Offer Deadline. Tenders received by the Tax Certification and Exchange Agent after the Exchange Offer Deadline will be disregarded and have no effect. Accordingly, we urge you to contact your clients as promptly as possible in order to obtain their instructions. |
| I. | When you “set-up” this issue, please be aware that tenders will be cancelled if all of the conditions below are not met. |
| · | DTC Participants must follow this Spanish tax procedure: |
· A beneficial owner list (“B.O. List”) (corresponding to ATOP instructions) must be uploaded to the Tax Certification and Exchange Agent at www.acupaysystem.com before Expiration.
· B.O. List details must equal total of all ATOP instructions at Expiration.
· Most firms’ Tax /Dividend Departments are already trained to upload B.O. Lists, or the Reorganization Department can do it. It makes no difference. Please contact Sabrina Cruz of Acupay to see who does B.O. List uploading for your firm: 1-212-422-1222 – scruz@acupay.com
| II. | Please send the following materials (“Materials”) to all of your clients who hold the above-referenced existing preferred securities (and to their brokers as well): |
1. Prospectus (WHITE);
2. Customer Instructions Form (BLUE); and
3. Broker Letter to Client (GREEN).
| III. | Please also inform your clients and their brokers that the Materials are available on the Internet at www.acupay.com/SANretail |
| IV. | Mailing Reimbursement: |
The relevant offeror will reimburse your firm for its out-of-pocket expenses incurred in forwarding the Materials listed above to your clients. Such reimbursement will be at levels established by the New York Stock Exchange. The Tax Certification and Exchange Agent must receive requests for reimbursement no later than 3 business days after the Exchange Offer Deadline at the following addresses:
| Via email: info@acupay.com |
| |
| By post, telephone or fax: |
| |
IN NEW YORK: Acupay System LLC Attention: Sabrina Cruz 30 Broad Street — 46th Floor New York, N.Y. 10004 USA Tel. 1-212-422-1222 Fax. 1-212-422-0790 |
V. Questions and Additional Materials:
If you have any questions or need additional Materials, please contact the Tax Certification and Exchange Agent Attn: Sabrina Cruz in New York at 1-212-422-1222 or at info@acupay.com.
Nothing contained herein or in the enclosed documents shall constitute you or any person as an agent of the Bank, Morgan Stanley & Co. Incorporated as the dealer manager or the Tax Certification and Exchange Agent, or authorize you or any other person to use any document or make any statements on behalf of either of them with respect to the exchange offers other than the documents enclosed herewith and the statements contained therein.
