Exhibit 5.1
September 24, 1999
Board of Directors
Sovereign Bancorp, Inc.
2000 Market Street
Philadelphia, Pennsylvania 19103
Re: Registration Statement on Form S-3
(No. 333-86961)
Ladies and Gentlemen:
In connection with the registration of Common Stock, Debt
Securities, Preferred Stock, Securities Warrants, Depositary
Shares, Stock Purchase Contracts, and Stock Purchase Units with
an aggregate initial public offering price of up to
$2,000,000,000, by Sovereign Bancorp, Inc. (the "Company"),
covered by the Company's Registration Statement on Form S-3 (No.
333-86961) (together with any pre-effective amendments thereto,
the "Registration Statement"), we, as counsel to the Company,
have reviewed:
(1) the Articles of Incorporation of the Company;
(2) the Bylaws of the Company;
(3) the minute books of the Company;
(4) a subsistence certificate with respect to the Company
issued by the Pennsylvania Department of State on
September 16, 1999;
(5) resolutions adopted by the Company's Board of Directors
on February 13, 1994 and August 18, 1999;
(6) the Registration Statement;
(7) the Subordinated Indenture and the Senior Indenture
both dated as of February 1, 1994 between the Company
and Harris Trust and Savings Bank;
(8) the Junior Subordinated Indenture dated September 1,
1999 between the Company and Harris Trust and Savings
Bank; and
(9) forms of the Debt Securities, the Securities Warrants,
the Stock Purchase Contracts, and the Depository
Agreement.
The documents listed above are hereinafter collectively
referred to as the Documents. All capitalized terms used herein
but not defined herein shall have the meaning given to them in
the Registration Statement.
_______________________
Based upon our review of the Documents, and subject to the
limitations, qualifications, exceptions and assumptions stated
hereafter, it is our opinion that:
(1) The Company has been duly incorporated under the laws
of the Commonwealth of Pennsylvania and is validly
existing and in good standing under the laws of such
Commonwealth.
(2) The Subordinated Indenture and the Senior Indenture,
both dated as of February 1, 1994 and the Junior
Subordinated Indenture dated as of September 2, 1999
(individually as "Indenture" and collectively the
"Indentures") between the Company and Harris Trust and
Savings Bank, as trustee (the "Trustee"), have been
duly authorized, executed, and delivered by the Company
and the Trustee, and constitute valid and legally
binding obligations of the Company, enforceable in
accordance with their respective terms.
(3) The Debt Securities covered by the Registration
Statement have been duly authorized for registration
under the Securities Act of 1933, as amended (the
"Act"), and when (a) the Board of Directors has
authorized the issuance thereof and established the
terms thereof, (b) Officers' Certificates have been
duly executed and delivered in accordance with the
applicable Indenture, (c) the Debt Securities have been
executed and authenticated in the manner set forth in
the applicable Indenture, (d) the pertinent provisions
of such state securities and "blue sky" laws as are
applicable have been complied with, and (e) the Debt
Securities have been issued, sold, and delivered in
accordance with the Registration Statement, the
Prospectus and any Prospectus Supplement relating
thereto against payment therefor as contemplated by the
Underwriting Agreement, the Debt Securities will be
validly executed, authenticated, issued, and delivered,
and will constitute valid and legally binding
obligations of the Company enforceable in accordance
with their respective terms and the terms of the
applicable Indenture.
(4) The Common Stock covered by the Registration Statement
has been duly authorized for registration under the
Act, and when (a) the Board of Directors has authorized
the issuance thereof, (b) the pertinent provisions of
such state securities and "blue sky" laws as are
applicable have been complied with, and (c) such shares
are duly issued, sold and delivered against payment
therefor as contemplated by the Underwriting Agreement,
pursuant to and in accordance with the terms described
in the Registration Statement, the Prospectus, and any
Prospectus Supplement relating thereto, such Common
Stock will be validly issued by the Company and fully
paid and nonassessable.
(5) The Preferred Stock covered by the Registration
Statement has been duly authorized for registration
under the Act, and when (a) the Board of Directors has
authorized the issuance thereof and established the
terms thereof, (b) a Certificate of Designation has
been duly filed with the Secretary of State of the
Commonwealth of Pennsylvania, (c) the pertinent
provisions of such state securities and "blue sky" laws
as are applicable have been complied with, and (d) such
shares have been duly issued, sold and delivered
against payment therefor as contemplated by the
Underwriting Agreement pursuant to and in accordance
with the terms described in the Registration Statement,
the Prospectus and any Prospectus Supplement relating
thereto, such Preferred Stock will be validly issued by
the Company and fully paid and nonassessable.
(6) The Securities Warrants covered by the Registration
Statement have been duly authorized for registration
under the Act, and when (a) the Board of Directors has
authorized the issuance thereof and established the
terms thereof, (b) the Securities Warrant Agreement has
been duly executed and delivered by the Company to the
Securities Warrant Agent, (c) the Securities Warrants
have been executed and authenticated in the manner set
forth in the Securities Warrant Agreement, (d) the
pertinent provisions of such state securities and "blue
sky" laws as are applicable have been complied with,
and (e) the Securities Warrants have been issued, sold
and delivered against payment therefor as contemplated
by the Underwriting Agreement, pursuant to and in
accordance with the Registration Statement, the
Prospectus and any Prospectus Supplement relating
thereto, such Securities Warrants will be validly
executed, authenticated, issued, and delivered and will
constitute valid and legally binding obligations of the
Company enforceable in accordance with their respective
terms and the terms of the Warrant Agreement.
(7) The Stock Purchase Contracts covered by the
Registration Statement have been duly authorized for
registration under the Act, and when (a) the Board of
Directors has authorized the issuance thereof and
established the terms thereof, (b) the Stock Purchase
Contracts have been duly executed and delivered by the
Company, (c) the pertinent provisions of such state
securities and "blue sky" laws as are applicable have
been complied with, and (d) the Stock Purchase
Contracts have been issued, sold and delivered against
payment therefor as contemplated by the Underwriting
Agreement, pursuant to and in accordance with the
Registration Statement, the Prospectus and any
Prospectus Supplement relating thereto, such Stock
Purchase Contracts will be validly executed, issued,
and delivered and will constitute valid and legally
binding obligations of the Company enforceable in
accordance with their respective terms.
(8) The Depositary Shares covered by the Registration
Statement have been duly authorized for registration
under the Act, and when (a) the Board of Directors has
authorized the issuance of such Depositary Shares and
the underlying Preferred Stock and established the
terms of such Depositary Shares and underlying
Preferred Stock, (b) a Statement with Respect to Shares
with respect to the underlying Preferred Stock has been
duly filed with the Secretary of State of the
Commonwealth of Pennsylvania, (c) the Depositary
Agreement has been duly executed and delivered by the
Company to the preferred stock depositary, (d) the
Depositary Shares have been executed by the preferred
stock depositary in the manner set forth in the
Depositary Agreement, (e) the pertinent provisions of
such state securities and "blue sky" laws as are
applicable have been complied with, and (f) the
Depositary Shares have been issued, sold, and delivered
against payment therefor as contemplated by the
Underwriting Agreement, pursuant to and in accordance
with the terms of the Registration Statement, the
Prospectus, and any applicable Prospectus Supplement
relating thereto, such Depositary Shares will be
validly issued and delivered and will be fully paid and
nonassessable.
(9) Assuming (a) appropriate corporate action is taken in
the future to authorize the issuance of Debt
Securities, Preferred Stock or Common Stock upon
exercise of any Securities Warrants and to establish
the terms thereof, (b) a sufficient number of shares of
Common Stock or Preferred Stock is authorized under the
Company's articles of incorporation on the date of
exercise of any Securities Warrants, (c) the Securities
Warrants have been duly executed, delivered,
authenticated, issued and exercised in accordance with
their terms and the terms of the Warrant Agreement and
in the manner described in the Registration Statement,
the Prospectus and any Prospectus Supplement relating
thereto, and (d) no change occurs in any applicable law
or pertinent facts, when (i) the pertinent provisions
of all securities laws, including state securities and
"blue sky" laws, as may be applicable have been
complied with, (ii) the Securities Warrants are
exercised in accordance with their terms and the terms
of the Warrant Agreement, and (iii) the Debt
Securities, Preferred Stock or Common Stock, as the
case may be, have been duly executed, authenticated and
delivered, the Debt Securities issuable upon the
exercise of any Securities Warrants will constitute
legal and valid obligations of the Company, enforceable
in accordance with their respective terms and entitled
to the benefit of the applicable Indenture, and the
Preferred Stock or Common Stock, as the case may be,
issuable upon the exercise of any Securities Warrants
will be duly authorized, validly issued and fully paid
and nonassessable.
(10) Assuming (a) a sufficient number of shares of Common
Stock or Preferred Stock is authorized under the
Company's articles of incorporation on the date of
conversion of any convertible Preferred Stock,
(b) appropriate corporate action is taken in the future
to authorize the issuance of any shares of Common Stock
or Preferred Stock upon conversion of any convertible
Preferred Stock and to establish the terms thereof,
(c) the Preferred Stock have been duly issued and
converted in accordance with their terms and in the
manner described in the Registration Statement, the
Prospectus and any Prospectus Supplement relating
thereto, (d) no change occurs in any applicable law or
pertinent facts, when (i) the pertinent provisions of
all securities laws, including state securities and
"blue sky" laws, as may be applicable have been
complied with, and (ii) the Preferred Stock are
converted in accordance with their terms, such shares
of Common Stock or Preferred Stock, as the case may be,
issuable upon such conversion will be duly authorized,
legally issued, fully paid and nonassessable.
(11) Assuming (a) a sufficient number of shares of Common
Stock or Preferred Stock is authorized under the
Company's articles of incorporation on the date of
conversion or exchange of any Debt Securities,
(b) appropriate corporate action is taken in the future
to authorize the issuance of any shares of Common Stock
or Preferred Stock upon conversion or exchange of any
Debt Securities and to establish the terms thereof,
(c) the Debt Securities have been duly issued and
converted or exchanged, as the case may be, in
accordance with their terms and the terms of the
applicable Indenture and in the manner described in the
Registration Statement, the Prospectus and any
Prospectus Supplement relating thereto, and (d) no
change occurs in any applicable law or fact, when
(i) the pertinent provisions of all securities laws,
including state securities and "blue sky" laws, as may
be applicable have been complied with, and (ii) the
Debt Securities are converted or exchanged in
accordance with their terms and the terms of the
applicable Indenture, such shares of Common Stock or
Preferred Stock, as the case may be, issuable upon such
conversion or exchange will be duly authorized, legally
issued and fully paid and nonassessable.
(12) Assuming (a) appropriate corporate action is taken in
the future to authorize the issuance of Preferred Stock
or Common Stock upon exercise of any Stock Purchase
Contracts and to establish the terms thereof, (b) a
sufficient number of shares of Common Stock or
Preferred Stock is authorized under the Company's
articles of incorporation on the date of exercise of
any Stock Purchase Contract, (c) the Stock Purchase
Contracts have been duly executed, delivered, issued
and exercised in accordance with their terms and in the
manner described in the Registration Statement, the
Prospectus and any Prospectus Supplement relating
thereto, and (d) no change occurs in any applicable law
or pertinent facts, when (i) the pertinent provisions
of all securities laws, including state securities and
"blue sky" laws, as may be applicable have been
complied with, and (ii) the Stock Purchase Contracts
are exercised in accordance with their terms, the
Preferred Stock or Common Stock, as the case may be,
issuable upon the exercise of any Stock Purchase
Contracts will be duly authorized, validly issued and
fully paid and nonassessable.
The opinions expressed in Paragraph 2 relating to the
Indentures constituting valid and legally binding obligations of
the Company and in Paragraphs 3, 5, 6, 7, and 9 above, relating
to whether the securities described therein will constitute valid
and legal obligations of the Company that will be enforceable in
accordance with their terms, are subject to the exception that
the validity, enforceability, and binding nature of such
securities and Indentures are subject to (a) applicable
bankruptcy, insolvency, reorganization, liquidation,
receivership, conservatorship, readjustment of debt, arrangement,
moratorium or other laws relating to or affecting the rights of
creditors generally, (b) any laws, regulations, or judicial
decisions affecting the rights of creditors of a savings and loan
holding company and any power granted to the Office of Thrift
Supervision, the Federal Deposit Insurance Corporation (the
"FDIC"), or any successor thereto in the event of bankruptcy or
insolvency of any subsidiary of the Company whose deposits are
insured by the FDIC or in the event the FDIC or any other person
is appointed conservator or receiver for any such subsidiary, and
(c) general principles of equity, including without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing, and the possible unavailability of specific performance,
injunctive relief or other equitable remedies, regardless of
whether such enforceability is considered in a proceeding in
equity or at law.
We call to your attention that we have only reviewed
proposed forms of the Debt Securities, Securities Warrants, Stock
Purchase Contracts, and Depository Agreement. To the extent that
the actual securities issued and sold under the Registration
Statement differ from such proposed forms of securities, the
opinions expressed herein may not remain applicable.
We assume no obligation to update or supplement our opinions
set forth herein to reflect any facts or circumstances that may
hereafter come to our attention or any changes in laws that may
hereafter occur.
We consent to the filing of this opinion as an exhibit to
the Registration Statement, and to the references to us under the
heading "Legal Matters" in the related Prospectus. In giving
this consent, 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 Securities and Exchange Commission thereunder.
Very truly yours,
STEVENS & LEE
/s/ Stevens & Lee