GREAT WESTERN FINANCIAL CORPORATION
TO
HARRIS TRUST AND SAVINGS BANK, as Trustee
THIRD SUPPLEMENTAL INDENTURE
dated as of January 22, 1997
8.206% Subordinated Deferrable
Interest Notes Due 2027
TABLE OF CONTENTS
ARTICLE I
Definitions . . . . . . . . . . . . 2
Section 1.1. Definition of Terms . . . . . . . . . . . . . . 2
ARTICLE II
General Terms and Conditions of the Notes. . . . . 5
Section 2.1. Designation and Principal Amount. . . . . . . . 5
Section 2.2. Maturity. . . . . . . . . . . . . . . . . . . . 5
Section 2.3. Form and Payment. . . . . . . . . . . . . . . . 6
Section 2.4. Global Note . . . . . . . . . . . . . . . . . . 6
Section 2.5. Interest. . . . . . . . . . . . . . . . . . . . 7
ARTICLE III
Redemption of the Notes . . . . . . . . . 9
Section 3.1. Tax Event Redemption. . . . . . . . . . . . . . 9
Section 3.2. Capital Treatment Event Redemption. . . . . . . 9
Section 3.3. Optional Redemption by Company. . . . . . . . . 9
Section 3.4. Redemption Procedures . . . . . . . . . . . . . 9
Section 3.5. No Sinking Fund . . . . . . . . . . . . . . . . 10
ARTICLE IV
Extension of Interest Payment Period . . . . . . 10
Section 4.1. Extension of Interest Payment Period. . . . . . 10
Section 4.2. Notice of Extension . . . . . . . . . . . . . . 10
ARTICLE V
Expenses . . . . . . . . . . . . . 11
Section 5.1. Payment of Expenses . . . . . . . . . . . . . . 11
ARTICLE VI
Subordination. . . . . . . . . . . . 12
Section 6.1. Agreement to Subordinate. . . . . . . . . . . . 12
ARTICLE VII
Covenants. . . . . . . . . . . . . 12
Section 7.1. Limitation on Dividends; Transactions with
Affiliates. . . . . . . . . . . . . . . . . . . 12
Section 7.2. Covenants as to the Trust . . . . . . . . . . . 13
ARTICLE VIII
Events of Default. . . . . . . . . . . 13
Section 8.1. Events of Default . . . . . . . . . . . . . . . 13
Section 8.2. Waiver of Past Defaults . . . . . . . . . . . . 14
ARTICLE IX
Form of Note . . . . . . . . . . . . 14
Section 9.1. Form of Note. . . . . . . . . . . . . . . . . . 14
ARTICLE X
Original Issue of Notes . . . . . . . . . 20
Section 10.1. Original Issue of Notes . . . . . . . . . . . . 20
ARTICLE XI
Miscellaneous. . . . . . . . . . . . 20
Section 11.1. Ratification of Indenture . . . . . . . . . . . 20
Section 11.2. Trustee Not Responsible for Recitals. . . . . . 21
Section 11.3. Governing Law . . . . . . . . . . . . . . . . . 21
Section 11.4. Separability . . . . . . . . . . . . . . . . . 21
Section 11.5. Counterparts. . . . . . . . . . . . . . . . . . 21
Section 11.6. Acknowledgement of Rights of Holders of
Capital Securities. . . . . . . . . . . . . . . 21
Section 11.7. Supplemental Indentures . . . . . . . . . . . . 21
THIRD SUPPLEMENTAL INDENTURE, dated as of January 22, 1997
(the "Third Supplemental Indenture"), between Great Western
Financial Corporation, a Delaware corporation (the "Company"),
Harris Trust and Savings Bank, as trustee (the "Trustee") under the
Indenture, dated as of September 12, 1990, as amended and
supplemented by the First Supplemental Indenture, dated as of April
30, 1993, and the Second Supplemental Indenture, dated as of
December 6, 1995, between the Company and the Trustee (the
"Indenture").
WHEREAS, the Company executed and delivered the Indenture to
the Trustee to provide for the future issuance of the Company's
unsecured and subordinated debt securities to be issued from time
to time in one or more series as might be determined by the Company
under the Indenture, in an unlimited aggregate principal amount
which may be authenticated and delivered as provided in the
Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a new series of its
Securities to be known as its "8.206% Subordinated Deferrable
Interest Notes due 2027" (the "Notes"), the form and substance of
such Notes and the terms, provisions and conditions thereof to be
set forth as provided in the Indenture and this Third Supplemental
Indenture;
WHEREAS, Great Western Financial Trust II, a Delaware
statutory business trust (the "Trust"), has offered to the public
$300 million aggregate liquidation amount of its 8.206% Capital
Securities, Series A (the "Capital Securities"), representing
undivided beneficial interests in the assets of the Trust and
proposes to invest the proceeds from such offering in $300 million
aggregate principal amount of the Notes; and
WHEREAS, the Company has requested that the Trustee execute
and deliver this Third Supplemental Indenture and all requirements
necessary to make this Third Supplemental Indenture a valid
instrument in accordance with its terms and to make the Notes, when
executed by the Company and authenticated and delivered by the
Trustee, the valid obligations of the Company have been performed,
and the execution and delivery of this Third Supplemental Indenture
has been duly authorized in all respects;
NOW THEREFORE, in consideration of the purchase and acceptance
of the Notes by the Holders thereof, and for the purpose of setting
forth, as provided in the Indenture, the form and substance of the
Notes and the terms, provisions and conditions thereof, the Company
covenants and agrees with the Trustee as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definition of Terms.
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same meaning when
used in this Third Supplemental Indenture;
(b) a term defined anywhere in this Third Supplemental
Indenture has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a Section or
Article of this Third Supplemental Indenture;
(e) headings are for convenience of reference only and do not
affect interpretation;
(f) for purposes of the Notes only, the following terms
have the meanings given to them in the Declaration
notwithstanding a contrary definition in the Indenture:
(i) Business Day; (ii) Capital Securities Guarantee;
(iii) Common Security; (iv) Delaware Trustee; (v)
Depositary; (vi) Dissolution Tax Opinion; (vii)
Ministerial Action; (viii) No Recognition Opinion;
(ix) Property Trustee; (x) Redemption Tax Opinion;
(xi) Regular Trustee; (xii) Special Event; (xiii) Trust
Securities; (xiv) Tax Event; (xv) Underwriting Agreement;
and
(g) the following terms have the meanings given to them in
this Section 1.1(g):
"Additional Interest" has the meaning given such term in
Section 2.5(c).
"Adjusted Treasury Rate" means, with respect to any Redemption
Date, the Treasury Rate plus (i) 1.10% if such Redemption Date
occurs on or before February 1, 1998, or (ii) .50% if such
Redemption Date occurs after February 1, 1998.
"Calculation Date" means the third Business Day preceding a
Redemption Date.
"Capital Treatment Event" means that the Company (or its
successor) is, becomes or pursuant to law or regulation will become
within 180 days, subject to the capital requirements under which
all or a portion of the Capital Securities would not constitute
Tier 1 Capital applied as if the Company (or its successor) were a
bank holding company (as that concept is used in the guidelines or
regulations issued by the Board of Governors of the Federal Reserve
System as of January 22, 1997 or its then equivalent).
"Comparable Treasury Issue" means, with respect to any
Redemption Date, the United States Treasury security selected by
the Quotation Agent as having a maturity comparable to the
Remaining Life that would be utilized, at the time of selection and
in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the
Remaining Life. If no United States Treasury security has a
maturity which is within a period from three months before to three
months after February 1, 2007, the two most closely corresponding
United States Treasury securities shall be used as the Comparable
Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest
month using such securities.
"Comparable Treasury Price" means, with respect to any
Redemption Date, (a) the average of five Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest
and lowest such Reference Treasury Dealer Quotations, or (b) if the
Trustee obtains fewer than five such Reference Treasury Dealer
Quotations, the average of all such quotations.
"Compound Interest" has the meaning given such term in Section
4.1.
"Coupon Rate" has the meaning given such term in Section
2.5(a).
"Deferred Interest" means Additional Interest and Compound
Interest.
"Declaration" means the Amended and Restated Declaration of
Trust of the Trust dated as of January 22, 1997.
"Dissolution Event" means that as a result of the occurrence
and continuation of a Special Event, the Trust is to be dissolved
in accordance with the Declaration, and the Notes held by the
Property Trustee are to be distributed to the holders of the Trust
Securities issued by the Trust pro rata in accordance with the
Declaration.
"Extended Interest Payment Period" has the meaning given such
term in Section 4.1.
"Global Note" has the meaning given such term in Section
2.4(a)(i).
"Make-Whole Amount" means, with respect to any Note, an amount
equal to the greater of (a) 100% of the principal amount of the
Note or (b) as determined by the Quotation Agent, the sum of the
present values of the principal amount and premium payable as part
of the Redemption Price with respect to an optional redemption of
such Note on February 1, 2007, together with the present values of
the scheduled payments of interest for the Remaining Life, in each
case discounted to the Redemption Date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Adjusted Treasury Rate.
"Maturity Date" means the date on which the Notes mature and
on which the principal shall be due and payable together with all
accrued and unpaid interest thereon, including Deferred Interest,
if any.
"Non Book-Entry Capital Securities" has the meaning given such
term in Section 2.4(a)(ii).
"Primary Treasury Dealer" means a primary U.S. Government
securities dealer in The City of New York.
"Quotation Agent" means Goldman, Sachs & Co. and its
successors; provided, however, that if the foregoing shall cease to
be a Primary Treasury Dealer, the Company shall substitute therefor
another Primary Treasury Dealer.
"Redemption Price" means, in the case of any redemption
permitted hereunder on or after February 1, 2007, a price equal to
the following prices, expressed in percentages of the principal
amount, plus any accrued and unpaid interest, including any
Compound Interest and Additional Interest, to the date fixed for
redemption. If redeemed during the 12-month period beginning
February 1:
Year Redemption Price
---- ----------------
2007 104.1030%
2008 103.6927%
2009 103.2824%
2010 102.8721%
2011 102.4618%
2012 102.0515%
2013 101.6412%
2014 101.2309%
2015 100.8206%
2016 100.4103%
and at 100% on or after February 1, 2017. Redemption Price
means in the case of a redemption permitted hereunder prior to
February 1, 2007 a price equal to the Make-Whole Amount, plus any
accrued interest, including any Compound Interest and Additional
Interest, to the date fixed for redemption.
"Reference Treasurer Dealer" means (a) the Quotation Agent and
(b) any other Primary Treasury Dealer selected by the Trustee after
consultation with the Company.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and any Redemption Date, the
average, as determined by the Trustee, of the bid and asked prices
for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the
Trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the Calculation Date.
"Remaining Life" means the period from the Redemption Date to
February 1, 2007.
"Treasury Rate" means, with respect to any Redemption Date,
(a) the yield, under the heading which represents the average for
the week immediately prior to the Calculation Date, appearing in
the most recently published statistical release designated
"H.15(519)" or any successor publication which is published weekly
by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury
securities adjusted to constant maturity under the caption
"Treasury Constant Maturities," for the maturity corresponding to
the Remaining Life (if no maturity is within three months before or
after the Remaining Life, yields for the two published maturities
most closely corresponding to the Remaining Life shall be
determined and the Treasury Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding to
the nearest month) or (b) if such release (or any successor
release) is not published during the week preceding the Calculation
Date or does not contain such yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable
Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price on the Calculation Date for
such Redemption Date.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE NOTES
Section 2.1. Designation and Principal Amount.
There is hereby authorized a series of Debt Securities
designated the "8.206% Subordinated Deferrable Interest Notes due
2027", limited in aggregate principal amount to Three Hundred Nine
Million Two Hundred Seventy-Nine Thousand Dollars ($309,279,000),
which amount shall be as set forth in any written Company Order for
the authentication and delivery of Notes pursuant to Section 303 of
the Indenture.
Section 2.2. Maturity.
The Maturity Date will be February 1, 2027.
Section 2.3. Form and Payment.
Except as provided in Section 2.4, the Notes shall be issued
as Registered Debt Securities in fully registered certificated form
without interest coupons. So long as the Holder of any Notes is
the Property Trustee, the payment of the principal of, premium, if
any, and interest, including Deferred Interest, if any, on such
Notes held by the Property Trustee will be made at such place and
to such account as may be designated by the Property Trustee.
Section 2.4. Global Note.
(a) In connection with a Dissolution Event:
(i) the Notes in certificated form may be presented to
the Trustee by the Property Trustee in exchange for
one or more global Notes in an aggregate principal
amount equal to all Outstanding Notes (a "Global
Note") to be registered in the name of the
Depositary, or its nominee, and delivered by the
Trustee to or for the account of the Depositary for
crediting to the accounts of its participants
pursuant to the instructions of the Regular
Trustees. The Company upon any such presentation
shall execute a Global Note in such aggregate
principal amount and deliver the same to the
Trustee for authentication and delivery in
accordance with the Indenture and this Third
Supplemental Indenture. Payments on the Notes
issued as a Global Note will be made to the
Depositary; and
(ii) if any Capital Securities are held in non book-
entry certificated form, the Notes in certificated
form may be presented to the Trustee by the
Property Trustee and any Capital Security
Certificate which represents Capital Securities
other than Capital Securities held by the
Depositary or its nominee ("Non Book-Entry Capital
Securities") will be deemed to represent beneficial
interests in Notes presented to the Trustee by the
Property Trustee having an aggregate principal
amount equal to the aggregate liquidation amount of
the Non Book-Entry Capital Securities until such
Capital Security Certificates are presented to the
Debt Securities Registrar for transfer or
reissuance at which time such Capital Security
Certificates will be cancelled and a Note
registered in the name of the holder of the Capital
Security Certificate or the transferee of the
holder of such Capital Security Certificate, as the
case may be, with an aggregate principal amount
equal to the aggregate liquidation amount of the
Capital Security Certificate cancelled will be
executed by the Company and delivered to the
Trustee for authentication and delivery in
accordance with the Indenture and this Third
Supplemental Indenture. On issue of such Notes,
Notes with an equivalent aggregate principal amount
that were presented by the Property Trustee to the
Trustee will be deemed to have been cancelled.
(b) A Global Note may be transferred, in whole but not in
part only to another nominee of the Depositary, or to a
successor Depositary selected or approved by the Company
or to a nominee of such successor Depositary.
(c) If at any time the Depositary notifies the Company that
it is unwilling or unable to continue as Depositary or if
at any time the Depositary for such series shall no
longer be registered or in good standing under the
Securities Exchange Act of 1934, as amended, or other
applicable statute or regulation, and a successor
Depositary for such series is not appointed by the
Company within 90 days after the Company receives such
notice or becomes aware of such condition, as the case
may be, the Company will execute, and, subject to the
Indenture, the Trustee will authenticate and deliver the
Notes in definitive registered form without coupons, in
authorized denominations, and in an aggregate principal
amount equal to the principal amount of the Global Note
in exchange for such Global Note. In addition, the
Company may at any time determine that the Notes shall no
longer be represented by a Global Note. In such event,
the Company will execute and, subject to Article Two of
the Indenture, the Trustee will authenticate and deliver
the Notes in definitive registered form without coupons,
in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the
Global Note in exchange for such Global Note. Upon the
exchange of the Global Note for such Notes in definitive
registered form without coupons, in authorized
denominations, the Global Note shall be cancelled by the
Trustee. Such Notes in definitive registered form issued
in exchange for the Global Note shall be registered in
such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Notes to the
Depositary for delivery to the Persons in whose names
such Notes are so registered.
Section 2.5. Interest.
(a) Each Note will bear interest at the rate of 8.206% per
annum (the "Coupon Rate") from the original date of
issuance until the principal thereof becomes due and
payable, and on any overdue principal and premium, if
any, and (to the extent that payment of such interest
is enforceable under applicable law) on any overdue
installment of interest at the Coupon Rate, compounded
semi-annually, payable (subject to the provisions of
Article Four of this Third Supplemental Indenture) semi-
annually in arrears on February 1 and August 1 of each
year (each, an "Interest Payment Date", commencing on
August 1, 1997), to the Person in whose name such Note
or any predecessor Note is registered, at the close of
business on the regular record date for such interest
installment, which, in respect of any Notes of which the
Property Trustee is the Holder of or a Note, shall be the
close of business on the Business Day next preceding that
Interest Payment Date. Notwithstanding the foregoing
sentence, if the Capital Securities are no longer in
book-entry only form or if pursuant to the Indenture the
Notes are not represented by a Global Note, the Company
may select a regular record date for such interest
installment which shall be any date at least one Business
Day before an Interest Payment Date.
(b) The amount of interest payable for any period will be
computed on the basis of a 360-day year of twelve 30-day
months. Except as provided in the following sentence,
the amount of interest payable for any period shorter
than a full semi-annual period for which interest is
computed, will be computed on the basis of the actual
number of days elapsed per 30-day month. In the event
that any date on which interest is payable on the Notes
is not a Business Day, then payment of the interest
payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that,
notwithstanding the provisions of Section 113 of the
Indenture, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the
same force and effect as if made on such date.
(c) If at any time while the Property Trustee is the Holder
of any Notes, the Trust or the Property Trustee is
required to pay any taxes, duties, assessments or
governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any
other taxing authority, then, in any case, the Company
will pay as additional interest ("Additional Interest")
on the Notes held by the Property Trustee, such
additional amounts as shall be required so that the net
amounts received and retained by the Trust and the
Property Trustee after paying such taxes, duties,
assessments or other governmental charges will be equal
to the amounts the Trust and the Property Trustee would
have received had no such taxes, duties, assessments or
other governmental charges been imposed.
ARTICLE III
REDEMPTION OF THE NOTES
Section 3.1. Tax Event Redemption.
If a Tax Event has occurred and is continuing and:
(a) the Company has received a Redemption Tax Opinion; or
(b) the Regular Trustees shall have been informed by
independent tax counsel experienced in such matters that
a No Recognition Opinion cannot be delivered to the
Trust, then the Company shall have the right upon not
less than 30 days nor more than 60 days notice to the
Holders of the Notes to redeem the Notes in whole or in
part for cash at the Redemption Price within 90 days
following the occurrence of such Tax Event (the "90-Day
Period"), provided that, if at the time there is
available to the Company the opportunity to eliminate,
within the 90-Day Period, the Tax Event by taking some
Ministerial Action, the Company shall pursue such
Ministerial Action in lieu of redemption, and provided,
further, that the Company shall have no right to redeem
the Notes while the Trust is pursuing any Ministerial
Action pursuant to its obligations under the Declaration.
Section 3.2. Capital Treatment Event Redemption.
If a Capital Treatment Event has occurred and is continuing,
the Company shall have the right upon not less than 30 days nor
more than 60 days notice to the Holders of the Notes to redeem the
Notes in whole (but not in part) for cash at the Redemption Price
at any time within 90 days following the occurrence of such Capital
Treatment Event.
Section 3.3. Optional Redemption by Company.
Subject to the provisions of Section 3.4(b) and to the
provisions of Article Eleven of the Indenture, except as otherwise
may be specified in this Third Supplemental Indenture, the Company
shall have the right to redeem the Notes, in whole or in part, from
time to time, on or after February 1, 2007, at the Redemption
Price.
Section 3.4. Redemption Procedures.
Any redemption pursuant to this Article III will be made upon
not less than 30 nor more than 60 days' notice to the Holder of the
Notes at the Redemption Price. If the Notes are only partially
redeemed, the Notes will be redeemed pro rata or by lot or by any
other method utilized by the Trustee; provided that, if at the time
of redemption the Notes are registered as a Global Note, the
Depositary shall determine by lot the principal amount of such
Notes held by each Holder of Notes to be redeemed. The Redemption
Price shall be paid prior to 12:00 noon, New York City time, on the
date of such redemption or at such earlier time as the Company
determines provided that the Company shall deposit with the Trustee
an amount sufficient to pay the Redemption Price by 10:00 a.m. on
the date such Redemption Price is to be paid.
Section 3.5. No Sinking Fund.
The Notes are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
Section 4.1. Extension of Interest Payment Period.
The Company shall have the right, at any time during the term
of the Notes, from time to time, to defer payments of interest by
extending the interest payment period of such Notes for up to 10
consecutive semi-annual periods (the "Extended Interest Payment
Period"). To the extent permitted by applicable law, interest, the
payment of which has been deferred because of the extension of the
interest payment period pursuant to this Section 4.1, will bear
interest thereon at the Coupon Rate compounded semi-annually for
each semi-annual period of the Extended Interest Payment Period
("Compound Interest"). At the end of the Extended Interest Payment
Period the Company shall pay all interest accrued and unpaid on the
Notes, including any Deferred Interest that shall be payable, to
the Holders of the Notes in whose names the Notes are registered in
the Security Register on the first record date after the end of the
Extended Interest Payment Period. Before the termination of any
Extended Interest Payment Period, the Company may further extend
such period, provided that such period together with all such
further extensions thereof shall not exceed 10 consecutive semi-
annual periods. Upon the termination of any Extended Interest
Payment Period and upon the payment of all Deferred Interest then
due, the Company may commence a new Extended Interest Payment
Period as if no Extended Interest Payment Period had previously
been declared, subject to the foregoing requirements. No interest
shall be due and payable during an Extended Interest Payment
Period, except at the end thereof.
Section 4.2. Notice of Extension.
(a) If the Property Trustee is the only registered Holder of
the Notes at the time the Company selects an Extended
Interest Payment Period, the Company shall give written
notice to the Regular Trustees, the Property Trustee and
the Trustee of its selection of such Extended Interest
Payment Period one Business Day before the earlier of (a)
the next succeeding date on which Distributions on the
Trust Securities issued by the Trust are payable, or (b)
the date the Trust is required to give notice of the
record date or the date such Distributions are payable to
holders of the Capital Securities issued by the Trust,
but in any event at least one Business Day before such
record date.
(b) If the Property Trustee is not the only Holder of the
Notes at the time the Company selects an Extended
Interest Payment Period, the Company shall give the
Holders of the Notes and the Trustee written notice of
its selection of such Extended Interest Payment Period 10
Business Days before the earlier of (i) the next
succeeding Interest Payment Date, or (ii) the date the
Company is required to give notice of the record or
payment date of such interest payment to Holders of the
Notes.
(c) The semi-annual period in which any notice is given
pursuant to paragraphs (a) or (b) of this Section 4.2
shall be counted as one of the 10 semi-annual periods
permitted in the maximum Extended Interest Payment Period
permitted under Section 4.1.
ARTICLE V
EXPENSES
Section 5.1. Payment of Expenses.
In connection with the offering, sale and issuance of the
Notes to the Property Trustee in connection with the sale of the
Trust Securities by the Trust, and in connection with the
maintenance of the Trust for so long as the Trust Securities are
outstanding, the Company, in its capacity as borrower with respect
to the Notes, shall:
(a) pay all costs and expenses relating to the offering, sale
and issuance of the Notes, including commissions to the
underwriters payable pursuant to the Underwriting
Agreement and compensation of the Trustee under the
Indenture in accordance with the provisions of Section
607 of the Indenture;
(b) pay all debts and obligations of the Trust (other than
with respect to the Trust Securities) and all costs and
expenses of the Trust (including, but not limited to,
costs and expenses relating to the organization of the
Trust, the offering, sale and issuance of the Trust
Securities (including commissions to the underwriters in
connection therewith), the fees and expenses of the
Regular Trustees, the Property Trustee and the Delaware
Trustee, the costs and expenses relating to the operation
of the Trust, including without limitation, costs and
expenses of accountants, attorneys, statistical or
bookkeeping services, expenses of printing and engraving
and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and
telephone and other telecommunications expenses and costs
and expenses incurred in connection with the acquisition,
financing, and disposition of Trust assets);
(c) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its
assets) and all liabilities, costs and expenses with
respect to such taxes of the Trust; and
(d) pay any and all fees and expenses related to the
enforcement by the Property Trustee of the rights of the
holders of the Capital Securities.
ARTICLE VI
SUBORDINATION
Section 6.1. Agreement to Subordinate.
The Company covenants and agrees, and each Holder of Notes
issued hereunder by such Holder's acceptance thereof likewise
covenants and agrees, that all Notes shall be issued subject to the
provisions of Article THIRTEEN of the Indenture; and each Holder of
a Note, whether upon original issue or upon transfer or assignment
thereof, accepts and agrees to be bound by such provisions.
ARTICLE VII
COVENANTS
Section 7.1. Limitation on Dividends; Transactions with
Affiliates.
(a) If Notes are issued to the Trust or a trustee of the
Trust and (i) there shall have occurred any event that would
constitute an Event of Default or (ii) the Company shall be in
default with respect of its payment of any obligations under
the Capital Securities Guarantee, then (A) the Company shall
not, and shall cause any subsidiary of the Company that is not
a wholly owned subsidiary of the Company not to, declare or
pay any dividend on, make any distributions with respect to,
or redeem, purchase or acquire, or make a liquidation payment
with respect to, any of its capital stock or the capital stock
of any such subsidiary, and (B) the Company shall not make any
payment of interest, principal or premium, if any, on or
repay, repurchase or redeem any debt securities (including
guarantees) issued by the Company which rank pari passu
with or junior to the Notes, provided that the foregoing
restriction in clause (A) does not apply to any stock
dividends paid by the Company, or any of its subsidiaries,
where the dividend stock is the same stock as that on which
the dividend is being paid.
(b) If Notes are issued to the Trust or a trustee of the
Trust and the Company shall have given notice of its election
to defer payments of interest on the Notes by extending the
interest payment period as provided in Article IV hereof and
such period, or any extension thereof, shall be continuing,
then (A) the Company shall not, and shall cause any subsidiary
of the Company that is not a wholly owned subsidiary of the
Company not to, declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase, acquire or
make a liquidation payment with respect to, any of its capital
stock or the capital stock of any such subsidiary, and (B) the
Company shall not make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any debt
securities (including guarantees) issued by the Company which
rank pari passu with or junior to the Notes, provided that the
foregoing restriction in clause (A) does not apply to any
stock dividends paid by the Company, or any of its
subsidiaries, where the dividend stock is the same as that on
which the dividend is being paid.
Section 7.2. Covenants as to the Trust.
For so long as such Trust Securities remain outstanding,
the Company will (i) maintain 100% direct or indirect ownership of
the Common Securities of the Trust; provided, however, that any
permitted successor of the Company under the Indenture may succeed
to the Company's ownership of the Common Securities, and (ii) use
its reasonable efforts to cause the Trust (A) to remain a statutory
business trust, except in connection with a distribution of Notes
as provided in the Declaration, the redemption of all of the Trust
Securities or certain mergers, consolidations or amalgamations
permitted by the Declaration, and (B) otherwise continue to be
treated as a grantor trust for United States federal income tax
purposes.
ARTICLE VIII
EVENTS OF DEFAULT
Section 8.1. Events of Default.
For the Notes only, a valid extension of the interest payment
period in accordance with Article IV hereof shall not constitute a
Default or Event of Default under Section 501(1) or (8) of the
Indenture.
For the Notes only, the voluntary or involuntary dissolution,
winding-up or termination of the Trust, except in connection with
the distribution of the Notes to the holders of the Trust
Securities in liquidation of the Trust, the redemption of all the
Trust Securities, or mergers, consolidations or amalgamations, each
as permitted by the Declaration, shall constitute an Event of
Default.
Section 8.2. Waiver of Past Defaults.
For the Notes only, any waiver pursuant to Section 513 of the
Indenture or any modification of such a waiver shall not be
effective until the holders of a majority in liquidation preference
of Trust Securities shall have consented to such waiver or
modification to such waiver; provided, however, that if the consent
of the Holder of each Outstanding Debt Security is required, such
waiver shall not be effective until each holder of the Trust
Securities shall have consented to such waiver.
ARTICLE IX
FORM OF NOTE
Section 9.1. Form of Note.
The Notes and the Trustee's Certificate of Authentication to
be endorsed thereon are to be substantially in the following forms:
(FORM OF FACE OF NOTE)
(IF THE NOTE IS TO BE A GLOBAL NOTE, INSERT - This Note is
a Global Note within the meaning of the Indenture hereinafter
referred to and is registered in the name of a Depositary or a
nominee of a Depositary. This Note is exchangeable for Global
Notes registered in the name of a person other than the Depositary
or its nominee only in the limited circumstances described in the
Indenture, and no transfer of this Note (other than a transfer
of this Note as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary) may be registered except in
limited circumstances. Every Note delivered upon registration of
transfer of, or in exchange for, or in lieu of, this Global Note
shall be a Global Note, subject to the foregoing, except in the
limited circumstances described above.
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC") to the issuer or its agent for registration of
transfer, exchange or payment, and any certificate issued is
registered in the name of Cede & Co. or in such other name as
requested by an authorized representative of DTC (or to such other
entity as is requested by an authorized representative of DTC) and
any payment is made to Cede & Co. (or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.)
No. __________________
$309,279,000
CUSIP No.__________________
8.206% SUBORDINATED DEFERRABLE INTEREST NOTE
DUE 2027
Great Western Financial Corporation, a Delaware corporation
(the "Company"), which term includes any successor corporation
under the Indenture hereinafter referred to), for value received,
hereby promises to pay to The First National Bank of Chicago, as
Property Trustee for Great Western Financial Trust II, or
registered assigns, the principal sum of Three Hundred Nine Million
Two Hundred Seventy Nine Thousand Dollars ($309,279,000) on
February 1, 2027. The Company further promises to pay interest on
said principal sum from January 27, 1997, or from the most recent
interest payment date (each such date, an "Interest Payment Date")
to which interest has been paid or duly provided for, semi-annually
(subject to deferral as set forth herein) in arrears on February 1
and August 1 of each year commencing August 1, 1997, at the rate of
8.206% per annum until the principal hereof shall have become due
and payable, and on any overdue principal and premium, if any, and
(without duplication and to the extent that payment of such
interest is enforceable under applicable law) on any overdue
installment of interest at the same rate per annum compounded semi-
annually. The amount of interest payable on any Interest Payment
Date shall be computed on the basis of a 360-day year of twelve 30-
day months. In the event that any date on which interest is
payable on this Note is not a Business Day, then payment of
interest payable on such date will be made on the next succeeding
day that is a Business Day (and 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
shall be made on the immediately preceding Business Day, in each
case with the same force and effect as if made on such date. The
interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or
more Predecessor Notes, as defined in said Indenture) is registered
at the close of business on the regular record date for such
interest installment, which shall be the close of business on the
Business Day next preceding such Interest Payment Date. [IF
PURSUANT TO THE PROVISIONS OF THE INDENTURE THE NOTES ARE NO LONGER
REPRESENTED BY A GLOBAL NOTE -- which shall be the close of
business on the ____ Business Day next preceding such Interest
Payment Date.] Any such interest installment not punctually paid
or duly provided for shall forthwith cease to be payable to the
registered Holders on such regular record date and may be paid to
the Person in whose name this Note (or one or more Predecessor
Notes) is registered at the close of business on a special record
date to be fixed by the Trustee for the payment of such defaulted
interest, notice whereof shall be given to the registered Holders
of this series of Notes not less than 10 days prior to such special
record date, all as more fully provided in the Indenture. The
principal of (and premium, if any) and the interest on this Note
shall be payable at the office or agency of the Trustee maintained
for that purpose in any coin or currency of the United States of
America that at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of
interest may be made at the option of the Company by check mailed
to the registered Holder at such address as shall appear in the
Security Register. Notwithstanding the foregoing, so long as the
Holder of this Note is the Property Trustee, the payment of the
principal of (and premium, if any) and interest on this Note will
be made at such place and to such account as may be designated by
the Property Trustee.
The indebtedness evidenced by this Note is, to the extent
provided in the Indenture, subordinate and junior in right of
payment to the prior payment in full of all Senior Indebtedness,
and this Note is issued subject to the provisions of the Indenture
with respect thereto. Each Holder of this Note, by accepting the
same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take
such action as may be necessary or appropriate to acknowledge or
effectuate the subordination so provided and (c) appoints the
Trustee his or her attorney-in-fact for any and all such purposes.
Each Holder hereof, by his or her acceptance hereof, hereby waives
all notice of the acceptance of the subordination provisions
contained herein and in the Indenture by each holder of Senior
Indebtedness, whether now outstanding or hereafter incurred, and
waives reliance by each such holder upon said provisions.
This Note shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory
for any purpose until the Certificate of Authentication hereon
shall have been signed by or on behalf of the Trustee.
Unless the Certificate of Authentication hereon has been
executed by the Trustee referred to on the reverse side hereof,
this Note shall not be entitled to any benefit under the Indenture
or be valid or obligatory for any purpose.
The provisions of this Note are continued on the reverse side
hereof and such continued provisions shall for all purposes have
the same effect as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to
be executed.
Dated___________________
GREAT WESTERN FINANCIAL CORPORATION
By________________________________
Attest:
By__________________________
Secretary
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the series of Notes described in
the within-mentioned Indenture.
HARRIS TRUST AND SAVINGS BANK,
as Trustee
HARRIS TRUST AND SAVINGS BANK, _________________________
as Trustee or as Authentication Agent
By________________________ By_______________________
Authorized Signatory Authorized Signatory
(FORM OF REVERSE OF NOTE)
This Note is one of a duly authorized series of Notes of the
Company (herein sometimes referred to as the "Notes"), specified in
the Indenture, all issued or to be issued in one or more series
under and pursuant to an Indenture dated as of September 12, 1990,
as amended and supplemented by a First Supplemental Indenture dated
as of April 30, 1993, a Second Supplemental Indenture dated as of
December 6, 1995 and a Third Supplemental Indenture dated as of
January 22, 1997, duly executed and delivered between the Company
and Harris Trust and Savings Bank, as Trustee (the "Trustee") (the
Indenture as so supplemented, the "Indenture"), to which Indenture
and all indentures supplemental thereto reference is hereby made
for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the
Company and the Holders of the Notes. By the terms of the
Indenture, the Notes are issuable in series that may vary as to
amount, date of maturity, rate of interest and in other respects as
provided in the Indenture. This series of Notes is limited in
aggregate principal amount as specified in said Third Supplemental
Indenture.
The Company shall have the right to redeem this Note at the
option of the Company, in whole or in part at any time on or after
February 1, 2007 (a "Optional Redemption") or at any time in
certain circumstances upon the occurrence of a Tax Event, or in
whole only within a limited time after the occurrence and
continuance of a Capital Treatment Event, in each case at the
redemption price specified in the Indenture plus any accrued but
unpaid interest, to the date of such redemption (the "Redemption
Price"). Any redemption pursuant to this paragraph will be made
upon not less than 30 nor more than 60 days' notice to the Holder
of the Notes at the Redemption Price. If the Notes are only
partially redeemed by the Company, the Notes will be redeemed pro
rata or by lot or by any other method utilized by the Trustee;
provided that if, at the time of redemption, the Notes are
registered as a Global Note, the Depositary shall determine by lot
the principal amount of such Notes held by each Holder of Notes to
be redeemed.
In the event of a redemption of this Note in part only, a new
Note for the unredeemed portion thereof will be issued in the name
of the Holder hereof upon cancellation hereof.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal of all of the
Notes may be declared, and upon such declaration shall become, due
and payable, in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than a
majority in aggregate principal amount of the Notes of each series
affected at the time outstanding, as defined in the Indenture, to
execute supplemental indentures for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Notes;
provided, however, that no such supplemental indenture shall (i)
extend the fixed maturity of any Notes of any series, or reduce the
principal amount thereof, or reduce the rate, or reduce any premium
payable upon the redemption thereof, without the consent of the
Holder of each Note so affected, or (ii) reduce the aforesaid
percentage of Notes, the Holders of which are required to consent
to any such supplemental indenture, without the consent of the
Holders of each Note then outstanding and affected thereby. The
Indenture also contains provisions permitting the Holders of a
majority in aggregate principal amount of the Notes of any series
at the time outstanding affected thereby, on behalf of all of the
Holders of the Notes of such series, to waive any past default in
the performance of any of the covenants contained in the Indenture,
or established pursuant to the Indenture with respect to such
series, and its consequences, except a default in the payment of
the principal of or premium, if any, or interest on any of the
Notes of such series. Any such consent or waiver by the registered
Holder of this Note (unless revoked as provided in the Indenture)
shall be conclusive and binding upon such Holder and upon all
future Holders and owners of this Note and of any Note issued in
exchange heretofore or in place hereof (whether by registration of
transfer or otherwise), irrespective of whether or not any notation
of such consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this
Note or of the Indenture shall alter or impair the obligation of
the Company, which is absolute and unconditional, to pay the
principal of and premium, if any, and interest on this Note at the
time and place and at the rate and in the money herein prescribed.
The Company shall have the right at any time during the term
of the Notes from time to time to extend the interest payment
period of such Notes to up to 10 consecutive semi-annual periods
(an "Extended Interest Payment Period"), at the end of which period
the Company shall pay all interest then accrued and unpaid
(together with interest thereon at the rate specified for the Notes
to the extent that payment of such interest is enforceable under
applicable law). Before the termination of any such Extended
Interest Payment Period, the Company may further extend such
Extended Interest Payment Period, provided that such Extended
Interest Payment Period together with all such further extensions
thereof shall not exceed 10 consecutive semi-annual periods. At
the termination of any such Extended Interest Payment Period and
upon the payment of all accrued and unpaid interest and any
additional amounts then due, the Company may commence a new
Extended Interest Payment Period.
As provided in the Indenture and subject to certain
limitations therein set forth, this Note is transferable by the
registered Holder hereof on the Security Register of the Company,
upon surrender of this Note for registration of transfer at the
office or agency of the Company in the City and State of New York
accompanied by a written instrument or instruments of transfer in
form satisfactory to the Company or the Trustee duly executed by
the registered Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of authorized
denominations and for the same aggregate principal amount and
series will be issued to the designated transferee or transferees.
No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this
Note, the Company, the Trustee, any paying agent and any Security
Registrar may deem and treat the registered Holder hereof as the
absolute owner hereof (whether or not this Note shall be overdue
and notwithstanding any notice of ownership or writing hereon made
by anyone other than the Security Registrar) for the purpose of
receiving payment of or on account of the principal hereof and
premium, if any, and interest due hereon and for all other
purposes, and neither the Company nor the Trustee nor any paying
agent nor any Security Registrar shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the principal of
or the interest on this Note, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the
Indenture, against any incorporator, stockholder, officer or
director, past, present or future, as such, of the Company or of
any predecessor or successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by
the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.
The notes of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral
multiple thereof. This Global Note is exchangeable for Notes in
definitive form only under certain limited circumstances set forth
in the Indenture. Notes of this series so issued are issuable only
in registered form without coupons in denominations of $1,000 and
any integral multiple thereof as provided in the Indenture and
subject to certain limitations herein and therein set forth. Notes
of this series so issued are exchangeable for a like aggregate
principal amount of Notes of this series of a different authorized
denomination, as requested by the Holder surrendering the same.
All terms used in this Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ARTICLE X
ORIGINAL ISSUE OF NOTES
Section 10.1. Original Issue of Notes.
Notes in the aggregate principal amount of Three Hundred Nine
Million Two Hundred Seventy-Nine Thousand Dollars ($309,279,000)
may, upon execution of this Third Supplemental Indenture, be
executed by the Company and delivered to the Trustee for
authentication, and the Trustee shall thereupon authenticate and
deliver said Notes to or upon the written order of the Company,
signed by its Chairman of the Board, its President, or one of its
Vice Presidents and attested to by its Secretary or one of its
Assistant Secretaries, without any further action by the Company.
ARTICLE XI
MISCELLANEOUS
Section 11.1. Ratification of Indenture.
The Indenture, as supplemented by this Third Supplemental
Indenture, is in all respects ratified and confirmed, and this
Third Supplemental Indenture shall be deemed part of the Indenture
in the manner and to the extent herein and therein provided.
Section 11.2. Trustee Not Responsible for Recitals.
The recitals herein contained are made by the Company and not
by the Trustee, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representation as to the
validity or sufficiency of this Third Supplemental Indenture.
Section 11.3. Governing Law.
This Third Supplemental Indenture and each Note shall be
deemed to be a contract made under the internal laws of the State
of New York, and for all purposes shall be construed in accordance
with the laws of said State.
Section 11.4. Separability.
In case any one or more of the provisions contained in this
Third Supplemental Indenture or in the Notes shall for any reason
be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect
any other provisions of this Third Supplemental Indenture or of the
Notes, but this Third Supplemental Indenture and the Notes shall be
construed as if such invalid or illegal or unenforceable provision
had never been contained herein or therein.
Section 11.5. Counterparts.
This Third Supplemental Indenture may be executed in any
number of counterparts each of which shall be an original; but such
counterparts shall together constitute but one and the same
instrument.
Section 11.6. Acknowledgement of Rights of Holders of Capital
Securities.
The Company acknowledges that the holders of the Capital
Securities are each entitled to enforce and exercise the rights and
remedies under the Indenture to the extent set forth in Section
5(b) of Exhibit A to the Declaration.
Section 11.7. Supplemental Indentures.
For the Notes only, any supplemental indenture referred to in
Section 902 of the Indenture shall not be effective until the
holders of a majority in liquidation preference of Trust Securities
shall have consented to such supplemental indenture; provided,
however, that if the consent of the Holder of each Outstanding Debt
Security is required, such supplemental indenture shall not be
effective until each holder of the Trust Securities shall have
consented to such supplemental indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed, and their respective
corporate seals to be hereunto affixed and attested, on the date or
dates indicated in the acknowledgements and as of the day and year
first above written.
GREAT WESTERN FINANCIAL CORPORATION
By: __________________________
Name:
Title:
Attest:
_______________________
Secretary
HARRIS TRUST AND SAVINGS BANK,
as Trustee
By: __________________________
Name:
Title:
Attest:
_______________________
Assistant Secretary