Registration No. 333-
As filed with the Securities and Exchange Commission on June 3, 1998
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
Registration Statement under
the Securities Act of 1933
--------------------
PROVIDIAN FINANCIAL CORPORATION
A DELAWARE CORPORATION
I.R.S. EMPLOYER NUMBER 94-2933952
PROVIDIAN FINANCING I PROVIDIAN FINANCING II
A DELAWARE STATUTORY BUSINESS TRUST A DELAWARE STATUTORY BUSINESS TRUST
I.R.S. EMPLOYER NUMBER: 94-6725806 I.R.S. EMPLOYER NUMBER: 94-6725807
PROVIDIAN FINANCING III PROVIDIAN FINANCING IV
A DELAWARE STATUTORY BUSINESS TRUST A DELAWARE STATUTORY BUSINESS TRUST
I.R.S. EMPLOYER NUMBER: 94-6725808 I.R.S. EMPLOYER NUMBER: 94-6725809
(Exact names of registrants as specified in their charters)
201 MISSION STREET
SAN FRANCISCO, CALIFORNIA 94105
(415) 543-0404
(Address, including zip code, and telephone numbers, including area code, of
registrant's principal executive offices)
--------------------
Ellen Richey
Executive Vice President, General Counsel and Secretary
Providian Financial Corporation
201 Mission Street
San Francisco, California 94105
(415) 543-0404
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Nathaniel M. Cartmell III Peter H. Darrow
Katharine A. Martin Cleary, Gottlieb, Steen & Hamilton
Pillsbury Madison & Sutro LLP One Liberty Plaza
235 Montgomery Street New York, Yew York 10006-1470
San Francisco, California 94104 (212) 225-2000
(415) 983-1000
--------------------
Approximate date of commencement of proposed sale to the public: From
time to time after this Registration Statement becomes effective.
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, please 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. [ ]
CALCULATION OF REGISTRATION FEE
=============================================================================================================================
Proposed maximum Proposed maximum
Amount to be aggregate offering aggregate offering Amount of
Title of each class of securities to be registered registered price per unit (1) price(1) registration fee
- -----------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $0.01 (2)
- -----------------------------------------------------------------------------------------------------------------------------
Preferred Stock (3)
- -----------------------------------------------------------------------------------------------------------------------------
Depositary Shares
- -----------------------------------------------------------------------------------------------------------------------------
Debt Securities (4)
- -----------------------------------------------------------------------------------------------------------------------------
Warrants (5)
- -----------------------------------------------------------------------------------------------------------------------------
Stock Purchase Contracts (6)
- -----------------------------------------------------------------------------------------------------------------------------
Stock Purchase Units (7)
- -----------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Providian Financing I (8)
- -----------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Providian Financing II (8)
- -----------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Providian Financing III
(8)
- -----------------------------------------------------------------------------------------------------------------------------
Preferred Securities of Providian Financing IV
(8)
- -----------------------------------------------------------------------------------------------------------------------------
Guarantees of Preferred Securities (9)
- -----------------------------------------------------------------------------------------------------------------------------
Other Units (10)
- -----------------------------------------------------------------------------------------------------------------------------
Total $2,000,000,000 100% (11) $590,000
=============================================================================================================================
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o).
(2) Subject to note (11) below, there are being registered hereunder an
indeterminate number of shares of Common Stock as may be sold, from time
to time, by the Registrant, including, without limitation, sales upon
exercise of Warrants, Stock Purchase Contracts and Stock Purchase Units.
There are also being registered hereunder an indeterminate number of
shares of Common Stock as shall be issuable upon conversion, redemption or
exchange of Preferred Stock or Debt Securities registered hereby. The
Common Stock being registered includes associated Preferred Stock Purchase
Rights.
(3) Subject to note (11) below, there are registered hereunder an
indeterminate number of shares of Preferred Stock as may be sold, from
time to time, by the Registrant, including sales upon exercise of
Warrants, Stock Purchase Contracts and Stock Purchase Units, and an
indeterminate number of shares of Preferred Stock as shall be issuable
upon conversion, redemption or exchange of Debt Securities registered
hereby.
(4) Subject to note (11) below, there are being registered hereunder an
indeterminate principal amount of Debt Securities as may be sold from time
to time by the Registrant, including sales upon the exercise of Warrants.
If any Debt Securities are being issued at an original issue discount,
then the offering price shall be in such greater principal amount as shall
result in an aggregate initial offering price not to exceed $2,000,000,000
less the dollar amount of any securities previously issued hereunder.
(5) Subject to note (11) below, there are being registered hereunder an
indeterminate amount and number of Warrants, representing rights to
purchase Debt Securities, Preferred Stock, Common Stock, or shares of
capital stock or debt of another corporation or entity.
(6) Subject to note (11) below, there are being registered hereunder an
indeterminate amount and number of Stock Purchase Contracts, representing
rights to purchase Preferred Stock or Common Stock.
(7) Subject to note (11) below, there are being registered hereunder an
indeterminate amount and number of Stock Purchase Units, representing
ownership of Stock Purchase Contracts and Debt Securities, or debt
obligations of third parties, including U.S.
Obligations or Preferred Securities.
(8) Subject to note (11) below, there are being registered hereunder an
indeterminate amount of Preferred Securities as may be sold from time to
time, including sales pursuant to Stock Purchase Units.
(9) Subject to note (11) below, there are being registered hereunder an
indeterminate amount of Guarantees of Preferred Securities as may be sold
from time to time, including sales pursuant to Stock Purchase Units. In
addition, this registration is deemed to include the rights of holders of
the Preferred Securities under the Guarantees, the Declaration (including
the tax and expense undertakings), the Subordinated Securities and the
Indenture, together constituting the backup undertakings as described in
this Registration Statement. No separate consideration will be received
for the Guarantees or the backup undertakings.
(10) Subject to note (11) below, there are being registered hereunder an
indeterminate amount of Other Units as may be sold from time to time by
the Registrant. The Other Units may consist of any combination of the
following securities registered hereby: Common Stock, Preferred Stock,
Depositary Shares, Debt Securities, Warrants, Stock Purchase Contracts,
Stock Purchase Units, Preferred Securities of Providian Financing I,
Preferred Securities of Providian Financing II, Preferred Securities of
Providian Financing III, and Preferred Securities of Providian Financing
IV and Guarantees of Preferred Securities.
(11) In no event will the aggregate initial offering price of all securities
issued from time to time pursuant to this Registration Statement exceed
$2,000,000,000. Any Securities registered hereunder may be sold separately
or as units with other securities registered hereunder.
--------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT THAT STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ 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 JUNE 3, 1998
PROSPECTUS
$2,000,000,000
PROVIDIAN FINANCIAL CORPORATION
COMMON STOCK, PREFERRED STOCK, DEPOSITARY SHARES, DEBT SECURITIES,
COMMON STOCK WARRANTS,
PREFERRED STOCK WARRANTS, THIRD PARTY WARRANTS, DEBT WARRANTS, STOCK PURCHASE
CONTRACTS, STOCK PURCHASE UNITS AND OTHER UNITS
PROVIDIAN FINANCING I
PROVIDIAN FINANCING II
PROVIDIAN FINANCING III
PROVIDIAN FINANCING IV
PREFERRED SECURITIES, GUARANTEED TO THE EXTENT SET FORTH
HEREIN BY PROVIDIAN FINANCIAL CORPORATION
Providian Financial Corporation (the "Company" or "Providian"), a
Delaware corporation, directly or through agents, dealers or underwriters
designated from time to time, or by third parties ("Third Parties") who have
acquired securities of the Company in private transactions or otherwise, or
counterparties with whom the Company may enter into hedging transactions (the
"Counterparties"), may sell from time to time up to $2,000,000,000 (or, if
applicable, the equivalent thereof in other currencies) in the aggregate,
subject to the limitations set forth below, of (a) shares of common stock, $0.01
par value per share, of the Company ("Common Stock"), (b) shares of preferred
stock, $0.01 par value per share, of the Company ("Preferred Stock"), in one or
more series, (c) depositary shares of the Company ("Depositary Shares"), (d)
unsecured senior or subordinated debt securities of the Company ("Debt
Securities"), (e) options, warrants and other rights to purchase shares of
Common Stock ("Common Stock Warrants") or shares of Preferred Stock ("Preferred
Stock Warrants"), (f) options, warrants and other rights to purchase shares of
capital stock or debt of another corporation or other entity ("Third Party
Warrants"), (g) options, warrants and other rights to purchase Debt Securities
("Debt Warrants"), (h) stock purchase contracts ("Stock Purchase Contracts") to
purchase Common Stock or Preferred Stock (i) stock purchase units ("Stock
Purchase Units") each representing ownership of a Stock Purchase Contract and
Preferred Stock, Debt Securities, debt obligations of third parties, including
the United States of America or agencies or instrumentalities thereof ("U.S.
Obligations") or Preferred Securities (as defined below), securing the holder's
obligation to purchase Common Stock or Preferred Stock under the Stock Purchase
Contract or (j) other units ("Other Units"), each of which may represent any
combination of the following: Common Stock, Preferred Stock, Depositary Shares,
Debt Securities, Common Stock Warrants, Preferred Stock Warrants, Third Party
Warrants, Debt Warrants, Stock Purchase Contracts, Stock Purchase Units,
Preferred Securities or Guarantees.
Providian Financing I, Providian Financing II, Providian Financing III
and Providian Financing IV, each of which is a statutory business trust formed
under the laws of the State of Delaware (each a "Financing Trust"), the Common
Securities (as defined herein) of which will be wholly-owned by the Company at
the time of issuance of Preferred Securities, may offer preferred securities
representing undivided beneficial interests in the assets of the respective
Financing Trust ("Preferred Securities"). The payment of periodic cash
distributions with respect to Preferred Securities of each of the Financing
Trusts out of moneys held by each of the Financing Trusts, and payments on
liquidation, redemption or otherwise with respect to such Preferred Securities,
will be guaranteed by the Company to the extent described herein (each a
"Guarantee"). See "Description of the Guarantees." The Company's obligations
under the Guarantees are subordinate and junior in right of payment to all
senior liabilities of the Company and rank PARI PASSU with the obligations of
the Company under any similar guarantee agreements issued by the Company on
behalf of holders of Subordinated Debt Securities. In the event a Financing
Trust issues Preferred Securities or Common Securities, the proceeds to such
Financing Trust from such offering will be invested in subordinated Debt
Securities, which will be issued and sold in one or more series by the Company
to such Financing Trust or the trustee of such trust. The subordinated Debt
Securities purchased by a Financing Trust may be subsequently distributed pro
rata to holders of Preferred Securities or Common Securities in connection with
the dissolution of such Financing Trust upon the occurrence of certain events as
may be described in an accompanying Prospectus Supplement.
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.
ADDITIONAL INFORMATION REGARDING THE SECURITIES IS SET FORTH ON THE
INSIDE FRONT COVER.
FOR A DISCUSSION OF CERTAIN RISKS ASSOCIATED WITH AN INVESTMENT IN THE
SECURITIES, SEE "GENERAL DESCRIPTION OF SECURITIES AND RISK FACTORS" ON PAGE 6.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES
UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
The date of this Prospectus is _____________
The Common Stock, Preferred Stock, Depositary Shares, Debt Securities,
Common Stock Warrants, Preferred Stock Warrants, Third Party Warrants, Debt
Warrants, Stock Purchase Contracts, Stock Purchase Units, Preferred Securities,
Guarantees and Other Units are collectively referred to herein as the
"Securities."
The Company, either Financing Trust, Third Parties or Counterparties
may sell the Securities to or through underwriters, dealers or agents or
directly to purchasers. See "Plan of Distribution." The Company and each
Financing Trust reserve the sole right to accept and, together with their
respective agents from time to time, to reject in whole or in part any proposed
purchase of Securities to be made directly or through agents. The accompanying
Prospectus Supplement sets forth, among other things, the names of any
underwriters, dealers or agents involved in the sale of the Securities in
respect of which this Prospectus is being delivered, and any applicable fee,
commission or discount arrangements with them.
--------------------
All specific terms of the offering and sale of Securities, including
the initial public offering price, aggregate amount, listing on any securities
exchange or quotation system, risk factors and the agents, dealers or
underwriters, if any, to be utilized in connection with the sale of the
Securities, will be set forth in an accompanying Prospectus Supplement
("Prospectus Supplement"). With respect to the Preferred Stock, the related
Prospectus Supplement will set forth, among other things, the specific
designation, rights, preferences, privileges and restrictions thereof, including
dividend rate or rates (or method of ascertaining the same), dividend payment
dates, voting rights, liquidation preference, and any conversion, exchange,
redemption or sinking fund provisions. With respect to the Debt Securities, the
related Prospectus Supplement will set forth, among other things, the specific
designation, rights and restrictions, including whether they are senior or
subordinated, the currencies or currency units in which they are denominated,
the aggregate principal amount, the maturity, rate or rates of interest (or
method of ascertaining the same) and time of payment thereof, and any
conversion, exchange, redemption or sinking fund provisions. With respect to the
Common Stock Warrants, Preferred Stock Warrants, Third Party Warrants and Debt
Warrants, the related Prospectus Supplement will contain, among other things, a
description of the Common Stock, Preferred Stock, capital stock or debt of such
third party and Debt Securities, respectively, for which each warrant will be
exercisable and the exercise price, duration, detachability, call provisions and
other principal terms of such Warrants. With respect to the Stock Purchase
Contracts, the related Prospectus Supplement will set forth, among other things,
the designation and number of shares of Common Stock or Preferred Stock issuable
thereunder, the purchase price of the Common Stock or Preferred Stock, the date
or dates on which the Common Stock or Preferred Stock is required to be
purchased by the holders of the Stock Purchase Contracts, any periodic payments
required to be made by the Company to the holders of the Stock Purchase
Contracts or vice versa, and the terms of the offering and sale thereof. In the
case of Stock Purchase Units, the related Prospectus Supplement will set forth,
among other things, the specific terms of the Stock Purchase Contracts and any
Preferred Stock, Debt Securities or debt obligations of third parties or
Preferred Securities securing the holder's obligation to purchase the Preferred
Stock or Common Stock under the Stock Purchase Contracts, and the terms of the
offering and sale thereof. With respect to the Preferred Securities, the related
Prospectus Supplement will set forth, among other things, the specific
designation, rights, preferences, privileges and restrictions thereof, including
dividend rate or rates (or method of ascertaining the same), dividend payment
dates, voting rights, liquidation preference, and any conversion, exchange,
redemption or sinking fund provisions, the terms upon which the proceeds of the
sale of the Preferred Securities will be used to purchase a specific series of
subordinated Debt Securities of the Company and the terms upon which the
obligations of the relevant Financing Trust to make periodic cash distributions
on the Preferred Securities or make payments upon liquidation or dissolution of
such Financing Trust or upon redemption of the Preferred Securities, to the
extent funds are available therefor, shall be unconditionally guaranteed by
Providian. With respect to the Other Units, the related Prospectus Supplement
will set forth, among other things, the specific terms of any Common Stock,
Preferred Stock, Common Stock Warrants, Preferred Stock Warrants, Third Party
Warrants, Debt Warrants, Stock Purchase Contracts, Stock Purchase Units,
Preferred Securities and Guarantees, and the terms of the offering and sale
thereof.
--------------------
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE
SECURITIES AND THE COMMON STOCK OF THE COMPANY. SUCH TRANSACTIONS MAY INCLUDE
STABILIZING TRANSACTIONS, THE PURCHASE OF SECURITIES TO COVER SYNDICATE SHORT
POSITIONS
-2-
AND THE IMPOSITION OF PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"PLAN OF DISTRIBUTION."
IN CONNECTION WITH THIS OFFERING, CERTAIN UNDERWRITERS AND SELLING GROUP
MEMBERS (IF ANY) MAY ENGAGE IN PASSIVE MARKET MAKING TRANSACTIONS IN THE
SECURITIES ON NASDAQ IN ACCORDANCE WITH RULE 103 OF REGULATION M. SEE "PLAN OF
DISTRIBUTION."
-3-
INDEX OF TERMS
Page on Which Page on Which
Term Term is Defined Term Term is Defined
- ---- --------------- ---- ---------------
Acquiring Party....................... 8 Preferred Stock.......................... 1
Administrators........................ 6 Preferred Stock Warrants................. 1
Certificate of Incorporation.......... 7 Prospectus Supplement.................... 2
Code..................................25 Property Trustee......................... 6
Commission............................ 5 Providian................................ 1
Common Securities..................... 6 Redemption Price......................... 8
Common Securities Guarantees..........22 Registration Statement................... 5
Common Stock.......................... 1 Rights................................... 8
Common Stock Warrants................. 1 Rights Plan ............................. 8
Company............................... 1 Securities............................... 2
Counterparties........................ 1 Securities Act........................... 5
Debt Depositary.......................13 Senior Debt Securities ..................12
Debt Securities ...................... 1 Senior Indenture.........................12
Debt Warrant Agent ...................19 Sponsor.................................. 6
Debt Warrant Agreement................19 Stock Purchase Contracts ................ 1
Debt Warrants ........................ 1 Stock Purchase Unit...................... 1
Declaration .......................... 6 Stock Warrant Agent......................17
Delaware Trustee ..................... 7 Stock Warrant Agreement .................16
Deposit Agreement.....................10 Stock Warrant Provisions ................17
Depositary............................10 Stock Warrants...........................16
Depositary Receipts ..................10 Subordinated Debt Securities ............12
Depositary Shares.....................10 Subordinated Indenture...................12
ERISA.................................25 Third Parties............................ 1
Event of Default......................14 Third Party Company......................13
Exchange Act.......................... 5 Third Party Registration Statement.......13
Financing Trust....................... 1 Third Party Securities ..................13
Financing Trustees.................... 6 Third Party Warrant Agent................18
Global Debt Securities................13 Third Party Warrant Agreement............18
Guarantees............................ 1 Third Party Warrants .................... 1
Guarantee Payments....................21 Trust Indenture Act...................... 6
Guarantee Trustee.....................21 Trust Securities ........................ 6
Indentures............................ 8 U.S. Dollar, Dollar, U.S. $, $........... 4
Junior Preferred Shares...............13 U.S. Obligations......................... 1
Mandatory Debt Securities............. 1 Voluntary Debt Securities................13
Other Units........................... 1
Preferred Securities.................. 1
--------------------
References herein to "U.S. Dollar," "Dollar," "U.S. $" or "$" are to
the lawful currency of the United States of America.
-4-
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports and other information with the Securities and
Exchange Commission (the "Commission"). Reports, proxy statements and other
information concerning Providian Financial Corporation can be inspected and
copied at the public reference facilities maintained by the Commission at its
offices at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549, as well as the Regional Offices of the Commission located at Seven World
Trade Center, 13th Floor, New York, New York 10048 and CitiCorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can
be obtained at prescribed rates from the Public Reference Section of the
Commission at its principal office at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. In addition, such reports, proxy statements and other
information may be accessed electronically at the Commission's site on the World
Wide Web at http://www.sec.gov. Such reports, proxy statements and other
information can also be inspected at the offices of the New York Stock Exchange,
Inc., 20 Broad Street, New York, New York 10005 and at the offices of the
Pacific Exchange, 301 Pine Street, San Francisco, California 94104.
The Company and the Financing Trusts have filed with the Commission a
registration statement on Form S-3 (the "Registration Statement") under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Securities. This Prospectus does not contain all of the information set forth in
the Registration Statement and the exhibits and schedules thereto, certain parts
of which are omitted in accordance with the rules and regulations of the
Commission. For further information we respect to the Company, the Financing
Trusts and the securities being offered hereby, reference is made to the
Registration Statement, which can be inspected at the public reference
facilities at the offices of the Commission set forth above. Any statements
contained herein concerning the provision of any document filed as an exhibit to
the Registration Statement or otherwise filed with the Commission and
incorporated by reference herein are not necessarily complete, and, in each
instance, reference is made to the copy of such document so filed for a more
complete description of the matter involved. Each such reference is qualified in
its entirety by such referenced documents.
No separate financial statements of the Financing Trusts have been
included herein. The Company does not consider that such financial statements
would be material to holders of the Securities because: (i) the Company, a
reporting company under the Exchange Act, owns, directly or indirectly, all of
the voting securities of each Financing Trust, (ii) neither Financing Trust has
any independent operations but exists for the sole purpose of issuing securities
representing undivided beneficial interests in the assets of such Financing
Trust and investing the proceeds thereof in subordinated Debt Securities, and
(iii) the obligations of each Financing Trust to make periodic cash payments on
Preferred Securities and payments upon liquidation or dissolution of such
Financing Trust or upon redemption of the Preferred Securities, to the extent
funds are available therefor, are unconditionally guaranteed by the Company. See
"Description of the Guarantees," "Description of the Preferred Securities" and
"Description of the Debt Securities--Subordinated Debt Securities."
--------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company
pursuant to the Exchange Act are incorporated herein by reference:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997;
(b) the Company's Current Report on Form 8-K dated February 13, 1998;
and
(c) the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the effective date of the
Registration Statement shall be deemed to be incorporated by reference in this
Prospectus and to be a part hereof from the date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
-5-
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein 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.
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, and who makes a written or oral request,
a copy of any and all of the information that has been incorporated by reference
in this Prospectus or any Prospectus Supplement, excluding exhibits. Requests
should be directed to: Investor Relations, Providian Financial Corporation, 201
Mission Street, San Francisco, California 94105, telephone number: (415)
543-0404.
PROVIDIAN FINANCIAL CORPORATION
Providian Financial Corporation is a diversified consumer lender,
offering a range of lending products, including unsecured credit cards,
revolving lines of credit, home loans, secured and partially secured credit
cards, and fee-based products. Through these products and services, the Company
seeks to achieve diversified earnings sources, with both spread-based and
fee-based income from loans and related products and services. The Company also
offers deposit products to customers nationwide.
The Company's executive offices are located at 201 Mission Street, San
Francisco, California, 94105, telephone number: (415) 543-0404.
THE FINANCING TRUSTS
Each of Providian Financing I, Providian Financing II, Providian
Financing III and Providian Financing IV is a statutory business trust formed
under Delaware law pursuant to (i) a separate declaration of trust executed by
the Company, as sponsor for such trust (the "Sponsor"), the Financing Trustees
(as defined herein) and the Administrators (as defined herein) of such trust and
(ii) the filing of a certificate of trust with the Secretary of State of the
State of Delaware on May 29, 1998. The declarations will be amended and restated
in their entirety (each, as so amended and restated, a "Declaration")
substantially in the form filed as an exhibit to the Registration Statement of
which this Prospectus is a part and will be qualified as Indentures under the
Trust Indenture Act of 1939. Each Financing Trust exists for the exclusive
purposes of (i) issuing the Preferred Securities and common securities
representing undivided beneficial interests in the assets of the Trust (the
"Common Securities" and, together with the Preferred Securities, the "Trust
Securities"), (ii) investing the proceeds received by such Financing Trust from
the sale of the Trust Securities in subordinated Debt Securities and (iii)
engaging in only those other activities necessary or incidental thereto. All of
the Common Securities will be directly or indirectly owned by the Company. The
Common Securities will rank PARI PASSU, and payments will be made thereon pro
rata, with the Preferred Securities, except that, upon an event of default under
a Declaration, the rights of the holders of the Common Securities to payment in
respect of distributions and payments upon liquidation, redemption and otherwise
will be subordinated to the rights of the holders of the Preferred Securities.
The Company will directly or indirectly acquire Common Securities in an
aggregate liquidation amount equal to ____% of the total capital of each
Financing Trust. Each Financing Trust has a term of approximately 55 years but
may terminate earlier, as provided in the relevant Declaration. Each Financing
Trust's business and affairs will be conducted by the trustees (the "Financing
Trustees") and persons who are employees or officers of or who are affiliated
with the Company (the "Administrators") appointed by the Company as the direct
or indirect holder of all the Common Securities. The holder of the Common
Securities of a Financing Trust will be entitled to appoint, remove or replace
any of, or increase or reduce the number of, the Financing Trustees and the
administrators therefor. The duties and obligations of the Financing Trustees
shall be governed by the Declaration of such Financing Trust. A financial
institution that is not affiliated with the Company and has combined capital and
surplus of not less than $100,000,000 shall act as property trustee and as
indenture trustee for each Financing Trust for the purposes of the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), pursuant to the
terms set forth in a Prospectus Supplement (the "Property Trustee"). In
addition, unless the Property Trustee maintains a principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
each Financing Trust will have a
-6-
trustee which has a principal place of business or reside in the State of
Delaware (the "Delaware Trustee"). The Company will pay all fees and expenses
related to the Financing Trusts and the offering of the Trust Securities.
The office of the Delaware Trustee for each Financing Trust is The Bank
of New York (Delaware), White Clay Center, Route 273, Newark, Delaware. The
address for each Financing Trust is c/o the Company, the Sponsor of each Trust,
at 201 Mission Street, San Francisco, California 94105.
USE OF PROCEEDS
Unless otherwise indicated in the applicable Prospectus Supplement, the
net proceeds from the sale of Securities offered hereby will be used for general
corporate purposes.
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS
The following table sets forth the ratio of earnings to fixed charges
and ratio of earnings to combined fixed charges and preferred stock dividend
requirements for the Company for the quarter ended March 31, 1998 and for each
of the years in the five-year period ended December 31, 1997. The ratio of
earnings to fixed charges is computed by dividing (i) income before income taxes
and fixed charges by (ii) fixed charges. The ratio of earnings to combined fixed
charges and preferred stock dividend requirements is computed by dividing (i)
income before income taxes and fixed charges by (ii) fixed charges and preferred
stock dividend requirements. Fixed charges consist of interest expense on
borrowings (including or excluding deposits, as the case may be), and the
portion of rental expense which is deemed representative of interest. The
preferred stock dividend requirements represent the pretax earnings which would
be required to cover such dividend requirements on the Company's preferred stock
outstanding. In February 1997, the Company redeemed its outstanding preferred
stock and accordingly there are no preferred stock dividend requirements for the
periods following such redemption.
Three Months
Ended
March 31, Year Ended December 31,
--------------- ---------------------------------------------------
1998 1997 1996 1995 1994 1993
--------------- --------- --------- --------- --------- ---------
(dollars in thousands)
EARNINGS TO FIXED CHARGES:
Excluding interest on deposits 10.26 14.20 5.93 4.90 5.17 3.51
Including interest on deposits 2.65 2.66 2.34 2.34 2.69 2.26
EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDEND REQUIREMENTS (a)
Excluding interest on deposits 10.26 13.28 5.19 4.32 4.40 3.09
Including interest on deposits 2.65 2.63 2.25 2.24 2.51 2.11
- ------------
(a) Preferred Stock dividend requirements are adjusted to represent a pretax
earnings equivalent.
GENERAL DESCRIPTION OF SECURITIES AND RISK FACTORS
The Company may offer under this Prospectus shares of Common Stock or
Preferred Stock, Depositary Shares, Debt Securities, Common Stock Warrants,
Preferred Stock Warrants, Third Party Warrants, Debt Warrants, Stock Purchase
Contracts, Stock Purchase Units or Other Units or any combination of the
foregoing, either individually or as units consisting of one or more Securities.
Each Financing Trust may offer Preferred Securities under this Prospectus. The
aggregate offering price of Securities offered by the Company or any Financing
Trust under this Prospectus will not exceed $2,000,000,000 (or the equivalent
thereof in other currencies). CERTAIN OF THE SECURITIES TO BE OFFERED HEREBY
THEMSELVES INVOLVE A HIGH DEGREE OF RISK. SUCH RISKS WILL BE SET FORTH IN THE
PROSPECTUS SUPPLEMENT RELATING TO SUCH SECURITY. IN ADDITION, CERTAIN RISK
FACTORS RELATING TO THE COMPANY'S BUSINESS ARE SET FORTH IN THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997, BEGINNING ON
PAGE 14 UNDER THE HEADING "CAUTIONARY STATEMENTS."
-7-
DESCRIPTION OF THE COMMON STOCK
GENERAL
Under the Company's Amended and Restated Certificate of Incorporation
(the "Certificate of Incorporation"), the Company is authorized to issue up to
400 million shares of Common Stock. The Common Stock is not redeemable, does not
have any conversion rights and is not subject to call. Holders of shares of
Common Stock have no preemptive rights to maintain their percentage of ownership
in future offerings or sales of stock of the Company. Holders of shares of
Common Stock have one vote per share in all elections of directors and on all
other matters submitted to a vote of stockholders of the Company. The holders of
Common Stock are entitled to receive dividends, if any, as and when declared
from time to time by the Board of Directors of the Company out of funds legally
available therefor. Upon liquidation, dissolution or winding up of the affairs
of the Company, the holders of Common Stock will be entitled to participate
equally and ratably, in proportion to the number of shares held, in the net
assets of the Company available for distribution to holders of Common Stock. The
shares of Common Stock currently outstanding are fully paid and nonassessable.
CERTAIN CERTIFICATE OF INCORPORATION PROVISIONS
Certain provisions in the Company's Certificate of Incorporation and
Bylaws may have the effect of delaying, deferring or preventing a change in
control of the Company. These provisions require that the Company's Board of
Directors be divided into three classes that are elected for staggered
three-year terms; provide that stockholders may act only at annual or special
meetings and may not act by written consent; do not provide for cumulative
voting in the election of directors; authorize the directors of the Company to
determine the size of the Board of Directors; require a vote of 80% of the
shares outstanding for the amendment of any of the foregoing provisions; require
that stockholder nominations for directors be made pursuant to timely notice;
provide that special meetings of stockholders may be called only by the Chairman
of the Board or by the Board of Directors; and authorize the Board of Directors
to establish one or more series of Preferred Stock, without any further
stockholder approval, having rights, preferences, privileges and limitations
that could impede or discourage the acquisition of control of the Company.
RIGHTS AGREEMENT
The Company's Board of Directors has adopted a share purchase rights
plan (the "Rights Plan") that provides for the distribution of rights ("Rights")
to holders of outstanding shares of Common Stock. Except as set forth below,
each Right, when exercisable, entitles the holder thereof to purchase from the
Company one one-hundredth of a share of Series A Junior Participating Preferred
Stock, par value $.01 per share, of the Company (the "Junior Preferred Shares")
at a price of $150 per one one-hundredth share, subject to adjustment. Holders
of the Rights, as such, are not stockholders of the Company and do not have
voting rights or the right to receive dividends.
Initially, the Rights are attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights certificates will
be distributed. The Rights will not separate from the Common Stock and will not
be exercisable until the earlier of either (i) 10 days following a public
announcement that a person or group of affiliated or associated persons has
acquired, or obtained the right to acquire, beneficial ownership of securities
representing 15% or more of the outstanding shares of Common Stock (an
"Acquiring Party") or (ii) 10 business days (or such later date as may be
determined by the Company's Board of Directors) following the commencement of
(or a public announcement of an intention to make) a tender offer or exchange
offer which would result in any person or group of affiliated or associated
persons becoming an Acquiring Party. The Rights will expire on the earlier of
(x) June 30, 2007 unless such expiration date is extended or (y) redemption or
exchange by the Company, as described below.
In the event that the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold after a person or group has become an Acquiring Party, proper
provision will be made so that each holder of a Right will thereafter have the
right to receive, upon the exercise thereof at the then current exercise price
of the Right, that number of shares of common stock of the
-8-
acquiring company which at the time of such transaction will have a market value
of two times the exercise price of the Right. In the event that any person or
group of affiliated or associated persons becomes an Acquiring Party, proper
provision will be made so that each holder of a Right, other than Rights
beneficially owned by the Acquiring Party (which will thereafter be void), will
thereafter have the right to receive upon exercise that number of shares of
Common Stock having a market value of two times the exercise price of the Right.
At any time after any person or group of affiliated or associated
persons becomes an Acquiring Party and prior to the acquisition by such person
or group of 50% or more of the outstanding Common Stock, the Board of Directors
of the Company may, at its option, exchange the Rights (other than Rights owned
by such person or group which will have become void), in whole or in part, at an
exchange ratio of one share of Common Stock, or one one-hundredth of a Junior
Preferred Share, per Right (subject to adjustment).
At any time prior to a person or group of affiliated or associated
persons becoming an Acquiring Party, the Board of Directors of the Company may,
at its option, redeem the Rights in whole, but not in part, at a price of $.01
per Right (the "Redemption Price"). The redemption of the Rights may be made
effective at such time on such basis with such conditions as the Board of
Directors in its sole discretion may establish. Immediately upon any such
action by the Board of Directors ordering the redemption of the Rights, the
right to exercise the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.
The Rights Plan may have the effect of delaying, deferring or
preventing a change in control of the Company without further action of the
stockholders and therefore could have a depressive effect on the price of the
Common Stock.
LISTING
The Common Stock is listed on the New York Stock Exchange and the
Pacific Exchange under the symbol "PVN."
DESCRIPTION OF THE PREFERRED STOCK
Under the Certificate of Incorporation, the Board of Directors of the
Company may direct the issuance of up to 50 million shares of Preferred Stock in
one or more series and with rights, preferences, privileges and restrictions,
including dividend rights, voting rights, conversion rights, terms of redemption
and liquidation preferences, that may be fixed or designated by the Board of
Directors from time to time pursuant to a certificate of designation without any
further vote or action by the Company's stockholders. The issuance of Preferred
Stock may have the effect of delaying, deferring or preventing a change in
control of the Company. Preferred Stock, upon issuance against full payment of
the purchase price therefor, will be fully paid and nonassessable. The specific
terms of a particular series of Preferred Stock will be described in the
Prospectus Supplement relating to that series. The description of Preferred
Stock set forth below and the description of the terms of a particular series of
Preferred Stock set forth in the related Prospectus Supplement do not purport to
be complete and are qualified in their entirety by reference to the certificate
of designation relating to that series. The related Prospectus Supplement will
contain a description of certain United States Federal income tax consequences
relating to the purchase and ownership of the series of Preferred Stock
described in such Prospectus Supplement.
The rights, preferences, privileges and restrictions of the Preferred
Stock of each series will be fixed by the certificate of designation relating to
such series. A Prospectus Supplement relating to each series will specify the
terms of the Preferred Stock as follows:
(a) The maximum number of shares to constitute the series and the
distinctive designation thereof;
(b) The annual dividend rate, if any, on shares of the series,
whether such rate is fixed or variable or both, the date or dates from
which dividends will begin to accrue or accumulate, the conditions for
payment of dividends, and whether dividends will be cumulative;
-9-
(c) The price at and the terms and conditions on which the shares
of the series may be redeemed, including the time during which shares
of the series may be redeemed and any accumulated dividends thereon
that the holders of shares of the series shall be entitled to receive
upon the redemption thereof;
(d) The liquidation preference, if any, and any accumulated
dividends thereon, that the holders of shares of the series shall be
entitled to receive upon the liquidation, dissolution or winding up of
the affairs of the Company;
(e) Whether or not the shares of the series will be subject to
operation of a retirement or sinking fund, and, if so, the extent and
manner in which any such fund shall be applied to the purchase or
redemption of the shares of the series, and the terms and provisions
relating to the operation of such fund;
(f) The terms and conditions, if any, on which the shares of the
series shall be convertible into or exchangeable for shares of any
other class or classes of capital stock of the Company or
a third party or any series of any other class or classes, or of any
other series of the same class, including the price or prices or the
rate or rates of conversion or exchange and the method, if any, of
adjusting the same;
(g) The voting rights, if any, on the shares of the series; and
(h) Any or all other preferences and relative, participating,
optional or other special rights or qualifications, limitations or
restrictions thereof.
As described under "Description of the Depositary Shares," the Company
may, at its option, elect to offer Depositary Shares evidenced by depositary
receipts ("Depositary Receipts"), each representing a fractional interest (to be
specified in the Prospectus Supplement relating to the particular series of the
Preferred Stock) in a share of the particular series of the Preferred Stock
issued and deposited with a Depositary (as defined below).
DESCRIPTION OF THE DEPOSITARY SHARES
The description set forth below and in the related Prospectus
Supplement of certain provisions of the Deposit Agreement (as defined below) and
of the Depositary Shares and Depositary Receipts does not purport to be complete
and is subject to and qualified in its entirety by reference to the forms of
Deposit Agreement and Depositary Receipts relating to each series of the
Preferred Stock which have been or will be filed with the Commission in
connection with the offering of fractional interests in such series of the
Preferred Stock.
GENERAL
The Company may, at its option, elect to offer fractional interests in
shares of Preferred Stock, rather than shares of Preferred Stock. In the event
such option is exercised, the Company will provide for the issuance by a
Depositary to the public of receipts for Depositary Shares, each of which will
represent a fractional interest as set forth in the Prospectus Supplement
relating to a particular series of the Preferred Stock.
The shares of any series of the Preferred Stock underlying the
Depositary Shares will be deposited under a separate Deposit Agreement (the
"Deposit Agreement") between the Company and a bank or trust company selected by
the Company having its principal office in the United States and having a
combined capital and surplus of at least $100,000,000 (the "Depositary"). The
Prospectus Supplement relating to a series of Depositary Shares will set forth
the name and address of the Depositary. Subject to the terms of the Deposit
Agreement, each owner of a Depositary Share will be entitled, in proportion to
the applicable fractional interest in a share of the Preferred Stock underlying
such Depositary Shares, to all the rights and preferences of the Preferred Stock
underlying such Depositary Shares (including dividend, voting, redemption,
conversion and liquidation rights). The Depositary Shares relating to any series
of Preferred Stock will be evidenced by Depositary Receipts issued pursuant to
the related Deposit Agreement.
-10-
Pending the preparation of definitive Depositary Receipts, the
Depositary may, upon the written order of the Company, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts but
not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay, and temporary Depositary Receipts will be
exchangeable for definitive Depositary Receipts at the Company's expense.
Upon surrender of Depositary Receipts at the office of the Depositary
and upon payment of the charges provided in the related Deposit Agreement and
subject to the terms thereof, a holder of Depositary Shares is entitled to have
the Depositary deliver to such holder the whole shares of Preferred Stock
underlying the Depositary Shares evidenced by the surrendered Depositary
Receipts.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends and other cash
distributions received in respect of the Preferred Stock to the record holders
of the Depositary Shares relating to such Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders on the relevant record
date. The Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributed shall be added to and treated as
part of the next sum received by the Depositary for distribution to record
holders of Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
REDEMPTION OF DEPOSITARY SHARES
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Stock held by the Depositary. The Depositary
shall mail notice of redemption not less than 30 and not more than 60 days prior
to the date fixed for redemption to the record holders of the Depositary Shares
to be so redeemed at their respective addresses appearing in the Depositary's
books. The redemption price per Depositary Share will be equal to the applicable
fraction of the redemption price per share payable with respect to such series
of the Preferred Stock. Whenever the Company redeems shares of Preferred Stock
held by the Depositary, the Depositary will redeem as of the same redemption
date the number of Depositary Shares relating to shares of Preferred Stock so
redeemed. If less than all of the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by lot or pro rata as may be
determined by the Depositary.
After the date fixed for redemption, the Depositary Shares so called
for redemption will no longer be deemed to be outstanding and all rights of the
holders of the Depositary Shares will cease, except the right to receive the
payments or other property to which the holders of such Depositary Shares are
entitled upon such redemption upon surrender to the Depositary of the Depositary
Receipts evidencing such Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the
Preferred Stock underlying the Depositary Shares are entitled to vote, the
Depositary will mail the information contained in such notice of meeting to the
record holders of such Depositary Shares. Each record holder of such Depositary
Shares on the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Depositary as to the
exercise of the voting rights pertaining to the number of shares of Preferred
Stock underlying such holder's Depositary Shares. The Depositary will endeavor,
insofar as practicable, to vote the number of shares of Preferred Stock
underlying such Depositary Shares in accordance with such instructions, and the
Company will agree to take all action which may be deemed necessary by the
Depositary in order to enable the Depositary to do so. The
-11-
Depositary will abstain from voting shares of Preferred Stock to the extent it
does not receive specific instructions from the holders of Depositary Shares
relating to such Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares
relating to any series of Preferred Stock and any provision of the related
Deposit Agreement may at any time be amended by agreement between the Company
and the Depositary named therein. However, any amendment which materially and
adversely alters the rights of the existing holders of Depositary Shares
relating to any series of Preferred Stock will not be effective unless such
amendment has been approved by the record holders of at least a majority of such
Depositary Shares then outstanding. A Deposit Agreement may be terminated by the
Company or the Depositary named therein only if (i) all outstanding Depositary
Shares relating thereto have been redeemed or (ii) there has been a final
distribution in respect of the Preferred Stock underlying the Depositary Shares
relating thereto in connection with any liquidation, dissolution or winding up
of the Company and such distribution has been distributed to the holders of the
related Depositary Shares.
CHARGES OF DEPOSITARY
The Company will pay all transfer and other taxes and governmental
charges arising solely from the existence of the depositary arrangements. The
Company will pay charges of the Depositary in connection with the initial
deposit of the Preferred Stock and any redemption of the Preferred Stock.
Holders of Depositary Shares will pay transfer and other taxes and governmental
charges and such other charges as are expressly provided in the related Deposit
Agreement to be for their accounts.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Shares all
reports and communications from the Company which are delivered to the
Depositary and which the Company is required to furnish to the holders of the
underlying Preferred Stock.
Neither the Depositary nor the Company will be liable if it is
prevented or delayed by law or any circumstance beyond its control from
performing its obligations under the Deposit Agreement. The obligations of the
Company and the Depositary under the Deposit Agreement will be limited to
performance in good faith of their duties thereunder and they will not be
obligated to prosecute or defend any legal proceeding in respect of any
Depositary Shares or underlying Preferred Stock unless satisfactory indemnity is
furnished. They may rely upon written advice of counsel or accountants, on
information provided by persons presenting Preferred Stock for deposit, holders
of Depositary Shares or other persons believed to be competent and on documents
believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary under a Deposit Agreement may resign at any time by
delivering to the Company notice of its election to do so, and the Company may
at any time with notice remove such Depositary, any such resignation or removal
to take effect upon the appointment of a successor Depositary and its acceptance
of such appointment. Such successor Depositary must be appointed within 90 days
after delivery of the notice of resignation or removal and must be a bank or
trust company having its principal office in the United States and having a
combined capital and surplus of at least $100,000,000.
DESCRIPTION OF THE DEBT SECURITIES
GENERAL
The Company may offer under this Prospectus Senior Debt Securities (as
defined below) or Subordinated Debt Securities (as defined below) or any
combination of the foregoing. The Debt Securities will represent unsecured
general obligations of the Company, and will either (i) rank prior to all
subordinated indebtedness of the Company and PARI PASSU with all other unsecured
indebtedness of the Company (the "Senior Debt Securities") or
-12-
(ii) be subordinate in right of payment to certain other debt obligations of the
Company (the "Subordinated Debt Securities"). The Senior Debt Securities and the
Subordinated Debt Securities may be issued under indentures substantially in the
forms filed as exhibits to the Registration Statement. In this Prospectus, the
indenture relating to Senior Debt Securities is referred to as the "Senior
Indenture," the indenture relating to Subordinated Debt Securities is referred
to as the "Subordinated Indenture," and the Senior Indenture and the
Subordinated Indenture are collectively referred to as "Indentures." Neither of
the Indentures will limit the amount of Debt Securities that may be issued
thereunder, and each Indenture will provide that Debt Securities may be issued
thereunder up to an aggregate principal amount authorized from time to time by
the Company and may be payable in any currency or currency unit designated by
the Company or in amounts determined by reference to an index. The following
summaries of certain provisions in the Indentures pursuant to which Debt
Securities are issued and of the Debt Securities, as the case may be, do not
purport to be complete. Such summaries make use of certain terms defined in the
Indentures and are qualified in their entirety by reference to the applicable
form of Indenture or Debt Security, respectively, filed as an exhibit to the
Registration Statement.
Reference is made to the applicable Prospectus Supplement for any
series of Debt Securities for the following terms: (i) the designation of such
series of Debt Securities; (ii) the aggregate principal amount of such
series of Debt Securities; (iii) the stated maturity or maturities for payment
of principal of such series of Debt Securities and any sinking fund or analogous
provisions; (iv) the rate or rates at which such series of Debt Securities shall
bear interest or the method of calculating such rate or rates of interest and
the interest payment dates for such series of Debt Securities; (v) the
currencies, currency unit or index in or according to which principal of and
interest and any premium on such series of Debt Securities shall be payable (if
other than U.S. Dollars); (vi) the redemption date or dates, if any, and the
redemption price or prices and other applicable redemption provisions for such
series of Debt Securities; (vii) whether such series of Debt Securities shall be
issued as one or more global debt securities ("Global Debt Securities"), and, if
so, the identity of the depositary (the "Debt Depositary") for such Global Debt
Security or Debt Securities; (viii) if not issued as one or more Global Debt
Securities, the denominations in which such series of Debt Securities shall be
issuable (if other than denominations of $1,000 and any integral multiple
thereof); (ix) the date from which interest on such series of Debt Securities
shall accrue; (x) the basis upon which interest on such series of Debt
Securities shall be computed (if other than on the basis of a 360-day year of
twelve 30-day months); (xi) if other than the principal amount thereof, the
portion of the principal amount of such series of Debt Securities which shall be
payable upon declaration of acceleration of the maturity thereof pursuant to the
Indenture; (xii) if other than the trustee (the "Trustee"), the person or
persons who shall be registrar for such series of Debt Securities; (xiii) the
Record Date; (xiv) the identity of the Trustee; (xv) any covenants of the
Company with respect to a series of Debt Securities; (xvi) whether the Debt
Securities are convertible into or exchangeable for Securities, or other
securities of the Company or Third Party Securities (as herein defined), and the
terms of such conversion or exchange; (xvii) whether the Debt Securities will be
issued at an original issue discount and a description of such discount; and
(xviii) any other term or provision relating to such series of Debt Securities
which is not inconsistent with the provisions of the Indenture.
Except as described in this Prospectus or the accompanying Prospectus
Supplement, the Indentures do not contain any covenants specifically designed to
protect holders of the Debt Securities against a reduction in the
creditworthiness of the Company in the event of a highly leveraged transaction
or to prohibit other transactions which may adversely affect holders of the Debt
Securities.
In the event Debt Securities of any series are to be offered that are
convertible into or exchangeable for securities of third parties ("Third Party
Securities"), the Prospectus Supplement will identify the Third Party
Securities, the issuer of such Third Party Securities (the "Third Party
Company"), all documents filed by the Third Party Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act since the end of such Third Party
Company's last completed fiscal year for which a Form 10-K annual report has
been filed and the document or documents filed under the Securities Act or the
Exchange Act which contain a description of the Third Party Securities being
sold or, if no such document or documents exist, the Prospectus Supplement will
include a description of the Third Party Securities being sold. Third Party
Securities will only be securities of third parties that are eligible to use
Form S-3 (or any successor form) for primary offerings under the rules and
regulations of the Commission or securities that are registered under Section 12
of the Exchange Act. To the extent the Securities Act requires registration of
the Third Party Securities by the Third Party Company, such as where the Third
Party Company is an affiliate of the Company, in connection with the issuance,
conversion and/or exchange of such Debt
-13-
Securities, the Company will cause the Third Party Company to file a third party
registration statement ("Third Party Registration Statement") under the
Securities Act. Where the conversion and/or exchange of the Debt Securities
would require an effective Third Party Registration Statement at the time of
such exchange or conversion, the exchange or conversion will be subject to the
effectiveness of such registration statement. For example, Debt Securities that
are convertible into or exchangeable for Third Party Securities may be
convertible or exchangeable by their terms at the election of the Company or
mandatorily at the expiration of a specified period or at other times under
specified circumstances ("Mandatory Debt Securities") or may be convertible or
exchangeable by their terms at the election of the Debt Holder at any time
during a specified period or periods or on a specified date or dates ("Voluntary
Debt Securities"). In the case of both Mandatory Debt Securities and Voluntary
Debt Securities, if the Company is an affiliate of the Third Party Company, the
Third Party Securities into which they may be converted or for which they may be
exchanged will be the subject of a registration statement filed under the
Securities Act by the Third Party Company prior to any offer of such Mandatory
or Voluntary Debt Securities, and a Third Party Registration Statement with
respect to such Third Party Securities will have been declared effective prior
to any sale of such Mandatory or Voluntary Debt securities, except in the case
of Voluntary Debt Securities that are not immediately exercisable or
convertible, in which case such a Third Party Registration Statement would have
to be effective, absent an exemption, when the Debt Holder elects to convert
such Voluntary Debt Securities into or exchange them for Third Party Securities.
EVENTS OF DEFAULT
Each Indenture defines an "Event of Default" with respect to a
particular series of the Debt Securities as being any one of the following
events: (1) default in the payment of interest on any Debt Security of such
series and the continuance of such default for a period of 30 days, or, in the
case of the Subordinated Debt Indenture, for a period of 90 days, (2) default in
the payment of all or any part of the principal of or any premium on any Debt
Security of such series when due whether at maturity, by proceedings for
redemption, by declaration or otherwise, (3) default in the satisfaction of any
sinking fund payment obligation relating to such series of Debt Securities, when
due and payable, (4) failure on the part of the Company to observe or perform in
any material respect any other agreements or covenants contained in the Debt
Securities of such series, the Indenture or any supplemental indenture relating
thereto, specifically contained for the benefit of the Holders of the Debt
Securities of such series, and continuance of the default for a period of 90
days after notice has been given to the Company by the Trustee, or to the
Company and the Trustee by the Holders of not less than 25% in principal amount
of the Debt Securities of such series and all other series so benefited (all
series voting as one class) at the time outstanding under the Indenture, or (5)
certain events of bankruptcy, insolvency or reorganization involving the
Company. An Event of Default with respect to a series of Debt Securities will
not necessarily constitute an Event of Default with respect to any other series
of Debt Securities. Except as may be described in the accompanying Prospectus
Supplement, the Indentures do not contain any Events of Default other than those
referred to herein.
If an Event of Default occurs with respect to the Debt Securities of
one or more series and is continuing, the Trustee, by notice to the Company, or
the Holders of not less than 25% in principal amount of the outstanding Debt
Securities of each such series, by notice in writing to the Company and to the
Trustee, may declare the principal amount (or, if the Debt Securities of any
such series are original issue discount Debt Securities, such portion of the
principal amount as may be specified in the terms of such series) of all the
Debt Securities of such series, together with any accrued interest, to be
immediately due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal amount of the Debt Securities of any one or
more series (or of all the Debt Securities, as the case may be) shall have been
so declared due and payable, and before any judgment or decree for the payment
of moneys due shall have been obtained or entered as hereinafter provided, the
Company shall pay or shall deposit with the Trustee a sum sufficient to pay any
matured installments of interest upon all the Debt Securities of such series (or
upon all the Debt Securities, as the case may be) and the principal of any and
all Debt Securities of such series (or of any and all the Debt Securities, as
the case may be) which shall have become due otherwise than by declaration (with
interest on overdue installments of interest to the extent permitted by law and
on such principal at the rate or rates of interest borne by, or prescribed
therefor in, the Debt Securities of such series to the date of such payment or
deposit) and any other amounts then payable to the Trustee under the Indenture,
and any and all defaults under the Indenture with respect to Debt Securities of
such series (or all Debt Securities, as the case may be), other than the
nonpayment of
-14-
principal of and any accrued interest on Debt Securities of such series (or any
Debt Securities, as the case may be) which shall have become due by declaration
shall have been cured, remedied or waived as provided in the Indenture, then and
in every such case the Holders of a majority in principal amount of the Debt
Securities of such series (or of all the Debt Securities, as the case may be)
then outstanding (all series voting as one class if more than one series are so
entitled), by written notice to the Company and to the Trustee, may rescind and
annul such declaration and its consequences; but no such rescission and
annulment shall extend to or affect any subsequent default, or impair any right
consequent thereon.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal or any premium or interest on the Debt Securities of the series to
which the default relates or to enforce the performance of any provision of such
series of Debt Securities or the Indenture.
The Holders of a majority in principal amount of the outstanding Debt
Securities of any series may waive any past Event of Default with respect of
such series and its consequences, except a continuing default in the
payment of the principal of or any premium or interest on such Debt Securities
or in the satisfaction of any sinking fund obligation relating to such series of
Debt Securities or in respect of a covenant or provision of the Indenture which
cannot be modified or amended without the consent of the Holder of each Debt
Security so affected.
MODIFICATIONS OF THE INDENTURE
Each of the Indentures provides that the Company and the Trustee may
enter into a supplemental indenture to amend the Indenture or the Debt
Securities without the consent of any Debt Holder: (1) to cure any ambiguity,
defect or inconsistency; (2) to permit a successor to assume the Company's
obligations under the Indenture as permitted by the Indenture; (3) to eliminate
or change any provision of the Indenture if such elimination or change does not
adversely affect the rights of any outstanding Debt Holder; (4) to provide for
the issuance and establish the terms and conditions of Debt Securities of any
series; (5) to add to the covenants of the Company further covenants,
restrictions or conditions for the protection of the Holders of all or any
particular series of Debt Securities and to make the occurrence, or the
occurrence and continuance, of a default in any such additional covenants,
restrictions or conditions an Event of Default permitting the enforcement of all
or any of the several remedies provided in the Indenture; or (6) to appoint, at
the request of the Trustee, a successor Trustee for a particular series of Debt
Securities to act as such pursuant to the provisions of the Indenture.
Each of the Indentures and the rights and obligations of the Company
and of the Holders of the Debt Securities may be modified or amended at any time
with the consent of the Holders of not less than a majority in aggregate
principal amount of all series of the Debt Securities at the time outstanding
under such Indenture and affected by such modification or amendment (voting as
one class); provided, however, that without the consent of the holder of the
Debt Securities affected, no such modification or amendment shall, among other
things, change the fixed maturity or redemption date thereof, reduce the rate of
interest thereon or alter the method of determining such rate of interest,
extend the time of payment of interest, reduce the principal amount thereof,
reduce any premium payable upon the redemption thereof, change the currency in
which any Debt Securities or the interest thereon are payable or impair the
right to institute suit for the enforcement of any such payment, reduce the
percentage of the Holders of such Debt Securities whose consent is required for
any such modification or amendment or change the time of payment, reduce the
amount of any minimum sinking fund payment, or modify any provisions of the
Indenture relating to the amendment thereof or the creation of a supplemental
indenture (unless the change increases the rights of the Holders).
DEFEASANCE AND DISCHARGE
All liability of the Company in respect to any outstanding Debt
Securities shall cease, terminate and be completely discharged if the Company
shall (a) deposit with the Trustee, in trust, at or before maturity, lawful
money or direct obligations of the United States of America (or, in the case of
Debt Securities denominated in a currency other than U.S. Dollars, of the
government that issued such currency), or obligations the principal of and
interest on which are guaranteed by the United States of America (or, in the
case of Debt Securities denominated in a currency other than U.S. Dollars,
guaranteed by the government that issued such currency), in such amounts and
maturing at
-15-
such times that the proceeds of such obligations to be received upon
the respective maturities and interest payment dates will provide funds
sufficient to pay the principal of and interest and any premium to maturity or
to the redemption date, as the case may be, with respect to such Debt
Securities, and (b) deliver to the Trustee an opinion of counsel to the effect
that the Holders of such Debt Securities will not recognize income, gain or loss
for federal income tax purposes as a result of such discharge. All obligations
of the Company to comply with certain covenants applicable to any outstanding
Debt Securities shall cease if the Company shall deposit with the Trustee, in
trust, at or before maturity, lawful money or direct obligations of the United
States of America (or, in the case of Debt Securities denominated in a currency
other than U.S. Dollars, of the government that issued such currency), or
obligations the principal of and interest on which are guaranteed by the United
States of America (or, in the case of Debt Securities denominated in a currency
other than U.S. Dollars, by the government that issued such currency), in such
amounts and maturing at such times that the proceeds of such obligations to be
received upon the respective maturities and interest payment dates will provide
funds sufficient to pay the principal of and interest and any premium to
maturity or to the redemption date, as the case may be, with respect to such
Debt Securities.
CONCERNING THE TRUSTEE
The Trustee for the Senior Debt Securities and the Trustee for the
Subordinated Debt Securities will be identified in the relevant Prospectus
Supplement. In certain instances, the Company or the Holders of a majority of
the then outstanding principal amount of the Debt Securities issued under an
Indenture may remove the Trustee and appoint a successor Trustee. The Trustee
may become the owner or pledgee of any of the Debt Securities with the same
rights it would have if it were not the Trustee. The Trustee and any successor
trustee must be a corporation organized and doing business as a commercial bank
under the laws of the United States or of any state thereof or of the District
of Columbia, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least $100,000,000 and subject to
examination by federal or state or District of Columbia authority. From time to
time and subject to applicable law relating to conflicts of interest, the
Trustee may also serve as Trustee under other indentures relating to Debt
Securities issued by the Company or affiliated companies and may engage in
commercial transactions with the Company and affiliated companies.
SENIOR DEBT SECURITIES
The Senior Debt Securities will be unsecured and will rank equally with
all other unsecured and unsubordinated indebtedness for borrowed money of the
Company.
SUBORDINATED DEBT SECURITIES
Subordinated Debt Securities may be issued from time to time in one or
more series under the Subordinated Debt Indenture. The Subordinated Debt
Securities will be subordinated and junior in right of payment to certain other
indebtedness of the Company to the extent set forth in the applicable Prospectus
Supplement.
In the event the Subordinated Debt Securities are issued to a Financing
Trust or a trustee of such trust in connection with the issuance of Trust
Securities by such Financing Trust, such Subordinated Debt Securities
subsequently may be distributed pro rata to the Holders of such Trust Securities
in connection with the dissolution of such Financing Trust upon the occurrence
of certain events described in the Prospectus Supplement relating to such Trust
Securities. Only one series of Subordinated Debt Securities will be issued to a
Financing Trust or a trustee of such trust in connection with the issuance of
Trust Securities by such Financing Trust.
Unless otherwise provided in the applicable Prospectus Supplement, if
Subordinated Debt Securities are issued to a Financing Trust or a trustee of
such trust in connection with the issuance of Trust Securities by such Financing
Trust and (i) there shall have occurred an event that would constitute an Event
of Default with respect to such Subordinated Debt Securities; (ii) the Company
shall be in default with respect to its payment of any obligations under the
related Preferred Securities Guarantee or Common Securities Guarantee; or (iii)
the Company shall have given notice of its election to defer payments of
interest on such Subordinated Debt Securities by extending the interest payment
period as provided in the Indenture and such period, or any extension thereof,
shall be continuing, then (a) the Company shall not declare or pay any dividend
on, make any distributions with respect to, or redeem, purchase or make a
liquidation payment with respect to, any of its capital stock, and (b) the
Company shall not make
-16-
any payment of interest, principal or premium, if any, on or repay, repurchase
or redeem any Debt Securities which rank junior to or PARI PASSU with such
Subordinated Debt Securities; PROVIDED that the foregoing restriction does not
apply to: (w) any stock dividends paid by the Company where the dividend stock
is of the same class as that of the stock held by the Holders receiving the
dividend, (x) any declaration of a dividend in connection with the
implementation of a stockholders' rights plan, or the issuance of stock under
any such plan in the future, or the redemption or repurchase of any such rights
pursuant thereto, (y) payments under a Guarantee, and (z) purchases of Common
Stock related to the issuance of Common Stock or rights under any of the
Company's or its subsidiaries' benefit plans for their directors, officers or
employees.
DESCRIPTION OF THE WARRANTS TO PURCHASE COMMON STOCK OR PREFERRED STOCK
The following statements with respect to the Common Stock Warrants and
Preferred Stock Warrants (collectively, the "Stock Warrants") are summaries of,
and subject to, the detailed provisions of a warrant agreement ("Stock Warrant
Agreement") to be entered into by the Company and a warrant agent to be selected
at the time of issue (the "Stock Warrant Agent"), which Stock Warrant Agreement
may include or incorporate by reference standard warrant provisions
substantially in the form of the Standard Stock Warrant Provisions (the "Stock
Warrant Provisions") filed as an exhibit to the Registration Statement or other
provisions set forth in the Stock Warrant Agreement which will be filed as an
exhibit to or incorporated by reference in the Registration Statement.
GENERAL
The Stock Warrants may be issued under the Stock Warrant Agreement
independently or together with any other Securities offered by any Prospectus
Supplement and may be attached to or separate from such other Securities. If
Stock Warrants are offered, the related Prospectus Supplement will describe the
terms of the Stock Warrants, including without limitation the following: (i) the
offering price, if any; (ii) the designation and terms of the Common Stock or
Preferred Stock purchasable upon exercise of the Stock Warrants; (iii) the
number of shares of Common Stock or Preferred Stock purchasable upon exercise of
one Stock Warrant and the initial price at which such shares may be purchased
upon exercise; (iv) the date on which the right to exercise the Stock Warrants
shall commence, the date on which such right shall expire and whether the
Company has the ability to extend the exercise period; (v) federal income tax
consequences; (vi) call provisions, if any; (vii) the currency, currencies or
currency units in which the offering price, if any, and exercise price are
payable; (viii) the antidilution provisions of the Stock Warrants; and (ix) any
other terms of the Stock Warrants. The shares of Common Stock or Preferred Stock
issuable upon exercise of the Stock Warrants will, when issued in accordance
with the Stock Warrant Agreement, be fully paid and nonassessable. If the
Company maintains the ability to reduce the exercise price of any Stock Warrant
and such right is triggered, the Company will comply with the federal securities
laws, including Rule 13e-4 under the Exchange Act, to the extent applicable.
EXERCISE OF STOCK WARRANTS
Stock Warrants may be exercised in the manner set forth in the
applicable Prospectus Supplement. Duly exercised Stock Warrants will be
delivered by the Stock Warrant Agent to the transfer agent for the Common Stock
or the Preferred Stock, as the case may be. Upon receipt thereof, the transfer
agent shall deliver or cause to be delivered, to or upon the written order of
the exercising warrantholder, the number of shares of Common Stock or Preferred
Stock purchased. If fewer than all of the Stock Warrants held by a warrantholder
are exercised, the Stock Warrant Agent shall deliver to the exercising
warrantholder a new Stock Warrant representing the unexercised Stock Warrants.
ANTIDILUTION PROVISIONS
The exercise price payable and the number of shares of Common Stock or
Preferred Stock, as the case may be, purchasable upon the exercise of each Stock
Warrant will be subject to adjustment in certain events, including the issuance
of a stock dividend to holders of Common Stock or Preferred Stock, respectively,
or a combination, subdivision or reclassification of Common Stock or Preferred
Stock, respectively. In lieu of adjusting the number of shares of Common Stock
or Preferred Stock purchasable upon exercise of each Stock Warrant, the Company
may elect to adjust the number of Stock Warrants. No adjustment in the number of
shares purchasable upon exercise of
-17-
the Stock Warrants will be required until cumulative adjustments require an
adjustment of at least 1% thereof. The Company may, at its option, reduce the
exercise price at any time. No fractional shares will be issued upon exercise of
Stock Warrants, but the Company will pay the cash value of any fractional shares
otherwise issuable. Notwithstanding the foregoing, in case of any consolidation,
merger, or sale or conveyance of the property of the Company as an entirety or
substantially as an entirety, the holder of each outstanding Stock Warrant shall
have the right upon the exercise thereof to the kind and number of shares of
stock and other securities and property (including cash) receivable by a holder
of the number of shares of Common Stock or Preferred Stock into which such Stock
Warrants were exercisable immediately prior thereto.
NO RIGHTS AS STOCKHOLDERS
Holders of Stock Warrants will not be entitled, by virtue of being such
holders, to vote, to consent, to receive dividends, to receive notice as
stockholders with respect to any meeting of stockholders for the election of
directors of the Company or any other matter, or to exercise any rights
whatsoever as stockholders of the Company.
DESCRIPTION OF THE THIRD PARTY WARRANTS
The following statements with respect to the Third Party Warrants are
summaries of, and subject to, the detailed provisions of a warrant agreement
(the "Third Party Warrant Agreement") to be entered into by the Company and a
warrant agent to be selected at the time of issue (the "Third Party Warrant
Agent"), which Third Party Warrant Agreement may include or incorporate by
reference standard warrant provisions substantially in the form of the Stock
Warrant Provisions or the provisions set forth in the form of Debt Securities
Warrant Agreement filed as an exhibit to the Registration Statement or other
provisions set forth in the Third Party Warrant Agreement which will be filed as
an exhibit to or incorporated by reference in the Registration Statement.
GENERAL
The Third Party Warrants may be issued under the Third Party Warrant
Agreement independently or together with any other Securities offered by any
Prospectus Supplement and may be attached to or separate from such other
Securities. If Third Party Warrants are offered, the related Prospectus
Supplement will describe the terms of the warrants, including without limitation
the following: (i) the offering price, if any; (ii) the designation, aggregate
principal amount and terms of the Third Party Securities purchasable upon
exercise of the warrants; (iii) if applicable, the designation and terms of the
Third Party Securities with which the Third Party Warrants are issued and the
number of Third Party Warrants issued with each such Third Party Security, (iv)
if applicable, the date on and after which the Third Party Warrants and the
related Third Party Securities will be separately transferable; (v) the number
or principal amount of Third Party Securities purchasable upon exercise of one
Third Party Warrant and the price at which such number or principal amount of
Third Party Securities may be purchased upon exercise; (vi) the date on which
the right to exercise the Third Party Warrants shall commence, the date on which
such right shall expire and whether the Company has the ability to extend the
exercise period; (vii) federal income tax consequences; (viii) whether the Third
Party Warrants will be issued in registered or bearer form; (ix) the currency,
currencies or currency units in which the offering price, if any, and exercise
price are payable; (x) the antidilution provisions of the Third Party Warrants;
and (xi) any other terms of the Third Party Warrants. If the Company maintains
the ability to reduce the exercise price of any Third Party Warrant and such
right is triggered, the Company will comply with the federal securities laws,
including Rule 13e-4 under the Exchange Act, to the extent applicable.
The Prospectus Supplement will identify the Third Party Securities, the
Third Party Company, all documents filed by the Third Party Company pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act since the end of such
Third Party Company's last completed fiscal year for which a Form 10-K annual
report has been filed and the document or documents filed under the Exchange Act
which contain a description of the Third Party Securities being sold or, if no
such document or documents exist, the Prospectus Supplement will include a
description of the Third Party Securities being sold. Third Party Warrants may
be offered only with respect to Third Party Securities of Third Party Companies
that are eligible to use Form S-3 (or any successor form) for primary offerings
under the rules and regulations of the Commission and Third Party Securities
that are registered under Section 12 of the Exchange Act. To the extent the
Securities Act requires registration of the Third Party Securities by the Third
Party Company, such as where the Third Party is an affiliate of the Company, in
connection with the issuance and/or
-18-
exercise of Third Party Warrants, the Company will cause the Third Party Company
to file a Third Party Registration Statement under the Securities Act. Where the
exercise of Third Party Warrants would require the Third Party to have an
effective Third Party Registration Statement at the time of exercise, the
exercise will be subject to the effectiveness of such registration statement.
For example, if the Company is an affiliate of the Third Party Company,
the Third Party Securities that can be acquired upon exercise of the Third Party
Warrants will be the subject of a registration statement filed under the
Securities Act by the Third Party Company prior to any offer of such Third Party
Warrants, and a Third Party Registration Statement will have been declared
effective prior to any sale of Third Party Warrants, except in the case of Third
Party Warrants which are not immediately exercisable, in which case such a
registration statement would have to be effective, absent an exemption, when the
holder of any Third Party Warrants elects to exercise them to acquire Third
Party Securities.
Third Party Warrants may be exchanged for new Third Party Warrants of
different denominations and may (if in registered form) be presented for
registration of transfer at the corporate trust office of the Third Party
Warrant Agent, which will be listed in the related Prospectus Supplement, or at
such other office as may be set forth therein. Warrantholders do not have any of
the rights of holders of Third Party Securities (except as may be otherwise set
forth in the Prospectus Supplement).
EXERCISE OF THIRD PARTY WARRANTS
Third Party Warrants may be exercised in the manner set forth in the
applicable Prospectus Supplement. Upon the exercise of Third Party Warrants, the
Third Party Warrant Agent will, as soon as practicable, deliver the Third Party
Securities in authorized denominations in accordance with the instructions of
the exercising warrantholder and at the sole cost and risk of such holder. If
less than all of the Third Party Warrants held by a warrantholder are exercised,
a new Third Party Warrant will be issued for the remaining amount of Third Party
Warrants.
DESCRIPTION OF THE WARRANTS TO PURCHASE DEBT SECURITIES
The following statements with respect to the Debt Warrants are
summaries of, and subject to, the detailed provisions of a warrant agreement
(the "Debt Warrant Agreement") to be entered into by the Company and a warrant
agent to be selected at the time of issue (the "Debt Warrant Agent"), which Debt
Warrant Agreement may include or incorporate by reference standard warrant
provisions substantially in the form of the Standard Debt Securities Warrant
Provisions filed as an exhibit to the Registration Statement or other provisions
set forth in the Debt Warrant Agreement which will be filed as an exhibit to or
incorporated by reference in the Registration Statement.
GENERAL
The Debt Warrants may be issued under the Debt Warrant Agreement
independently or together with any Debt Securities offered by any Prospectus
Supplement and may be attached to or separate from such Debt Securities.
If Debt Warrants are offered, the related Prospectus Supplement will
describe the terms of the Debt Warrants, including without limitation the
following: (i) the offering price, if any; (ii) the designation, aggregate
principal amount and terms of the Debt Securities purchasable upon exercise of
the Debt Warrants; (iii) the principal amount of Debt Securities purchasable
upon exercise of the Debt Warrants and the price at which such principal amount
of Debt Securities may be purchased upon exercise; (iv) the date or dates on
which the right to exercise the Debt Warrants shall commence, the date on which
such right shall expire and whether the Company has the ability to extend the
exercise period; (v) federal income tax consequences, if any; (vi) the currency,
currencies or currency units in which the offering price, if any, and exercise
price are payable; and (vii) any other terms of the Debt Warrants.
Debt Warrants may be exchanged for new Debt Warrants of different
denominations and may be presented for registration of transfer at the corporate
trust office of the Debt Warrant Agent, which will be listed in the related
Prospectus Supplement, or at such other office as may be set forth therein.
Warrantholders do not have any of the
-19-
rights of holders of Debt Securities and are not entitled to payments of
principal of and interest, if any, on the Debt Securities.
EXERCISE OF DEBT WARRANTS
Debt Warrants may be exercised in the manner set forth in the
applicable Prospectus Supplement. Upon the exercise of Debt Warrants, the Debt
Warrant Agent will, as soon as practicable, deliver the Debt Securities in
authorized denominations in accordance with the instructions of the exercising
warrantholder and at the sole cost and risk of such warrantholder.
DESCRIPTION OF THE STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
The Company may issue Stock Purchase Contracts, which are contracts
obligating holders to purchase from the Company, and the Company to sell to the
holders, a specified number of shares of Common Stock or Preferred Stock at a
future date or dates. The price per share of Common Stock or Preferred Stock may
be fixed at the time the Stock Purchase Contracts are issued or may be
determined by reference to a specific formula set forth in the
Stock Purchase Contracts. Any such formula may include antidilution provisions
to adjust the number of shares issuable pursuant to Stock Purchase Contracts
upon certain events. The Stock Purchase Contracts may be issued separately or as
a part of Stock Purchase Units each representing ownership of a Stock Purchase
Contract and Debt Securities, Preferred Securities or debt obligations of a
Third Party Company, including U.S. Obligations, securing the holders'
obligations to purchase the Common Stock or the Preferred Stock under the
Purchase Contracts.
In the case of Stock Purchase Units that include debt obligations of a
Third Party Company, unless a holder of Stock Purchase Units settles its
obligations under the Stock Purchase Contracts early through the delivery of
consideration to the Company or its agent in the manner discussed below, the
principal of such debt obligations, when paid at maturity, will automatically be
applied to satisfy the holder's obligation to purchase Common Stock or Preferred
Stock under the Stock Purchase Contracts.
In the case of Stock Purchase Units that include Debt Securities or
Preferred Securities, in the absence of any such early settlement or the
election by a holder to pay the consideration specified in the Stock Purchase
Contracts prior to the stated settlement date, the Debt Securities or Preferred
Securities will automatically be presented to the applicable Financing Trust for
redemption at 100% of face or liquidation value and such Financing Trust will
present Subordinated Debt Securities in an equal principal amount to the Company
for redemption at 100% of principal amount. Amounts received in respect of such
redemption will automatically be transferred to the Company and applied to
satisfy in full the holder's obligation to purchase Common Stock or Preferred
Stock under the Stock Purchase Contracts. The Stock Purchase Contracts may
require the Company to make periodic payments to the holders of the Stock
Purchase Units or vice versa, and such payments may be unsecured or prefunded on
some basis. The Stock Purchase Contracts may require holders to secure their
obligations thereunder in a specified manner.
Holders of Stock Purchase Units may be entitled to settle the
underlying Stock Purchase Contracts prior to the stated settlement date by
surrendering the certificate evidencing the Stock Purchase Units, accompanied by
the payment due, in such form and calculated pursuant to such formula as may be
prescribed in the Stock Purchase Contracts and described in the applicable
Prospectus Supplement. Upon early settlement, the holder will receive the number
of shares of Common Stock or Preferred Stock deliverable under such Stock
Purchase Contracts, subject to adjustment in certain cases. Holders of Stock
Purchase Units may be entitled to exchange their Stock Purchase Units, together
with appropriate collateral, for separate Stock Purchase Contracts and Preferred
Securities, Debt Securities or debt obligations. In the event of such early
settlement or exchange, the Preferred Securities, Debt Securities or debt
obligations that were pledged as security for the obligation of the holder to
perform under the Stock Purchase Contracts will be transferred to the holder
free and clear of the Company's security interest therein.
The applicable Prospectus Supplement will describe the terms of any
Stock Purchase Contracts or Stock Purchase Units.
-20-
DESCRIPTION OF THE PREFERRED SECURITIES
Each Financing Trust may issue only one series of Preferred Securities
having terms described in the Prospectus Supplement relating thereto. The
Declaration of each Financing Trust authorizes the Administrators of each
Financing Trust to issue on behalf of such Financing Trust one series of
Preferred Securities. Each Declaration will be qualified as an indenture under
the Trust Indenture Act. The Preferred Securities will have such terms,
including distributions redemption, voting, liquidation rights and such other
preferred, deferred or other special rights or such restrictions, as shall be
set forth in the Declaration or made part of the Declaration by the Trust
Indenture Act. Reference is made to the Prospectus Supplement relating to the
Preferred Securities for specific terms including: (i) the distinctive
designation of such Preferred Securities; (ii) the number of Preferred
Securities issued; (iii) the annual distribution rate (or method of determining
such rate) for such Preferred Securities and the date or dates upon which such
distributions shall be payable (provided, however, that distributions on such
Preferred Securities shall be payable on a quarterly basis to holders of such
Preferred Securities as of a record date in each quarter during which such
Preferred Securities are outstanding); (iv) whether distributions on Preferred
Securities shall be cumulative, and, in the case of Preferred Securities having
such cumulative distribution rights, the date or dates or method of determining
the date or dates from which distributions on Preferred Securities shall be
cumulative; (v) the amount or amounts which shall be paid out of the assets of
such Financing Trust to the holders of Preferred Securities upon voluntary or
involuntary dissolution of such Financing Trust; (vi) the obligation, if any, of
such Financing Trust to purchase or redeem Preferred Securities and the price or
prices at which, the period or periods within which and the terms and conditions
upon which Preferred Securities issued by such Financing Trust shall be
purchased or redeemed, in whole or in part, pursuant to such obligation; (vii)
the voting rights, if any, of Preferred Securities issued by such Financing
Trust in addition to those required by law, including the number of votes per
Preferred Security and any requirement for the approval by the holders of
Preferred Securities, or of Preferred Securities issued by both Financing Trusts
as a condition to specified action or amendments to the Declaration of such
Financing Trust; (viii) whether the Preferred Securities will be issued in the
form of one or more global securities; and (ix) any other relevant rights,
preferences, privileges, limitations or restrictions of Preferred Securities
issued by such Financing Trust consistent with the Declaration of such trust or
with applicable law. All Preferred Securities offered hereby will be guaranteed
by the Company to the extent set forth below under "Description of the
Guarantees." Certain United States federal income tax considerations applicable
to any offering of Preferred Securities will be described in the Prospectus
Supplement relating thereto.
In connection with the issuance of Preferred Securities, each Financing
Trust will issue one series of Common Securities. The Declaration of each
Financing Trust authorizes the Administrators to issue on behalf of such
Financing Trust one series of Common Securities having such terms including
distributions, redemption, voting, liquidation rights or such restrictions as
shall be set forth therein. The terms of the Common Securities issued by a
Financing Trust will be substantially identical to the terms of the Preferred
Securities issued by such trust and 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 an event of default
under the Declaration, the rights of the holders of the Common Securities to
payment in respect of distributions and payments upon liquidation, redemption
and otherwise will be subordinated to the rights of the holders of the Preferred
Securities. Except in certain limited circumstances the Common Securities will
also carry the right to vote and to appoint, remove or replace any of the
Financing Trustees or the Administrators. All of the Common Securities will be
directly or indirectly owned by the Company.
DESCRIPTION OF THE GUARANTEES
Set forth below is a summary of information concerning the Guarantees
that will be executed and delivered by the Company for the benefit of the
Holders, from time to time, of Preferred Securities. Each Preferred Securities
Guarantee Agreement under which Guarantees are issued will be qualified as an
indenture under the Trust Indenture Act. The trustee under each Guarantee (the
"Guarantee Trustee") will be identified in the relevant Prospectus Supplement,
and will be a financial institution not affiliated with the Company that has a
combined capital and surplus of at least $100,000,000. The terms of each
Guarantee will be those set forth in such Guarantee and those made part of such
Guarantee by the Trust Indenture Act. The summary does not purport to be
complete. Such summary makes use of certain terms defined in the Guarantee and
is subject in all respects to the provisions of, and is qualified in its
entirety by reference to, the form of Guarantee, which is filed as an exhibit to
the Registration
-21-
Statement of which this Prospectus forms a part, and the Trust Indenture Act.
Each Guarantee will be held by the Guarantee Trustee for the benefit of the
holders of the Preferred Securities of the applicable Financing Trust.
GENERAL
Pursuant to each Guarantee, the Company will unconditionally agree, to
the extent set forth therein, to pay in full to the holders of the Preferred
Securities issued by each Financing Trust, the Guarantee Payments (as defined
herein) (except to the extent paid by such Financing Trust), as and when due,
regardless of any defense, right of set-off or counterclaim which such Financing
Trust may have or assert other than the defense of payment. The following
payments with respect to Preferred Securities issued by each Financing Trust
(the "Guarantee Payments"), to the extent not paid by or on behalf of such
Financing Trust, will be subject to the Guarantee (without duplication): (i) any
accrued and unpaid distributions that are required to be paid on such Preferred
Securities, but if and only to the extent that in each case the Company has made
a payment to the related Property Trustee of interest or principal on the
Subordinated Debt Securities held in such Financing Trust as trust assets; (ii)
the redemption price, including all accrued and unpaid distributions (the
"Redemption Price"), but if and only to the extent that in each case the Company
has made a payment to the related Property Trustee of interest or principal on
the Subordinated Debt Securities held in such Financing Trust as trust assets
with respect to any Preferred Securities called for redemption by such Financing
Trust; and (iii) upon a voluntary or involuntary dissolution, winding up or
termination of such Financing Trust (other than in connection with the
distribution of Subordinated Debt Securities to the holders of Preferred
Securities or the redemption of all of the Preferred Securities), the lesser of
(a) the aggregate of the liquidation amount and all accrued and unpaid
distributions on such Preferred Securities to the date of payment to the extent
such Financing Trust has funds available therefor or (b) the amount of assets of
such Financing Trust remaining available for distribution to holders of such
Preferred Securities on liquidation of such Financing Trust. The Company's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Company to the holders of Preferred Securities or by
causing the applicable Financing Trust to pay such amounts to such holders.
Each Guarantee will be a guarantee with respect to the Preferred
Securities issued by the applicable Financing Trust from the time of issuance of
such Preferred Securities but will not apply to any payment of distributions
except to the extent the Company has made a payment to the related Property
Trustee of interest or principal on the Subordinated Debt Securities held in
such Financing Trust as trust assets. If the Company does not make interest
payments on the Subordinated Debt Securities purchased by a Financing Trust,
such Financing Trust will not pay distributions on the Preferred Securities
issued by such Financing Trust and will not have funds available therefor and
such payment obligation will therefore not be guaranteed by the Company under
the applicable Guarantee. See "Description of the Preferred Securities" and
"Description of the Debt Securities--Subordinated Debt Securities."
The Company's obligations under the Declaration for each Financing
Trust, the Preferred Securities Guarantee issued with respect to Preferred
Securities issued by such Financing Trust, the Subordinated Debt Securities
purchased by such Financing Trust and the related Subordinated Indenture in the
aggregate will provide a full and unconditional guarantee on a subordinated
basis by the Company of payments due on the Preferred Securities issued by such
Financing Trust.
The Company has also agreed to unconditionally guarantee the
obligations of the Financing Trusts with respect to the Common Securities (the
"Common Securities Guarantees") to the same extent as the Guarantees, except
that, upon an event of default under the Subordinated Indenture, holders of
Preferred Securities under the Guarantees shall have priority over holders of
Common Securities under the Common Securities Guarantee with respect to
distributions and payments on liquidation, redemption or otherwise.
CERTAIN COVENANTS OF THE COMPANY
In each Guarantee, the Company will covenant that, so long as any
Preferred Securities issued by the applicable Financing Trust remain
outstanding, if there shall have occurred any event that would constitute an
event of default under such Guarantee or the Declaration of such Financing
Trust, then (a) the Company shall not declare or pay any dividend on, or make
any distribution with respect to, or redeem, purchase, acquire or make a
liquidation
-22-
payment with respect to, any of its capital stock 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 issued by the Company which rank junior
to or PARI PASSU with such Subordinated Debt Securities. However, each Guarantee
will except from the foregoing any stock dividends paid by the Company or any of
its subsidiaries, where the dividend stock is of the same class as that on which
the dividend is being paid.
MODIFICATION OF THE GUARANTEES; ASSIGNMENT
Except with respect to any changes that do not adversely affect the
rights of holders of Preferred Securities (in which case no vote will be
required), each Guarantee may be amended only with the prior approval of the
holders of not less than a majority in liquidation amount of the outstanding
Preferred Securities issued by the applicable Financing Trust. The manner of
obtaining any such approval of holders of such Preferred Securities will be set
forth in an accompanying Prospectus Supplement. All guarantees and agreements
contained in a Guarantee shall bind the successors, assignees, receivers,
trustees and representatives of the Company and shall inure to the benefit of
the holders of the Preferred Securities of the applicable Financing Trust then
outstanding.
EVENTS OF DEFAULT
An Event of Default under the Guarantee will occur upon the failure of
the Company to perform any of its payments or other obligations thereunder. The
holders of a majority in liquidation amount of the Preferred Securities to which
a Guarantee relates have the right to (a) waive any past Events of Default and
its consequences, whereupon such event of default shall cease to exist and any
event of default under the Guarantee arising therefrom shall be deemed to have
been cured and (b) 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 or power conferred upon the
Guarantee Trustee under the Guarantee.
If the Guarantee Trustee fails to enforce such Guarantee, any holder of
Preferred Securities relating to such Guarantee may, after a period of 30 days
has elapsed from such holder's written request to the Guarantee Trustee to
enforce the Guarantee, institute a legal proceeding directly against the Company
to enforce its rights under such Guarantee without first instituting a legal
proceeding against the applicable Financing Trust, the Guarantee Trustee or any
other person or entity.
The Company will be required to provide annually to the Guarantee
Trustee a statement as to the performance by the Company of certain of its
obligations under each of the Guarantees and as to any default in such
performance.
TERMINATION OF THE GUARANTEES
Each Guarantee will terminate as to the Preferred Securities issued by
the applicable Financing Trust upon full payment of all distributions relating
to the Preferred Securities or the Redemption Price of all Preferred Securities
of such Trust, upon distribution of the Subordinated Debt Securities held by
such Financing Trust to the holders of the Preferred Securities of such
Financing Trust or upon full payment of the amounts payable in accordance with
the Declaration of such Financing Trust upon liquidation of such Financing
Trust. Each Guarantee will continue to be effective or will be reinstated, as
the case may be, if at any time any holder of Preferred Securities issued by the
applicable Financing Trust must restore payment of any sums paid under such
Preferred Securities or such Guarantee.
STATUS OF THE GUARANTEES
Each Guarantee will constitute an unsecured obligation of the Company
and will rank (i) subordinate and junior in right of payment to all senior
liabilities of the Company; (ii) PARI PASSU with the obligations of the Company
under any similar guarantee agreements issued by the Company on behalf of
holders of Subordinated Debt Securities; and (iii) senior to the Company's
Common Stock. The terms of the Preferred Securities provide that each holder of
Preferred Securities issued by such Financing Trust by acceptance thereof agrees
to the subordination provisions and other terms of the applicable Guarantee.
-23-
The Guarantee Trustee shall enforce the Guarantee on behalf of the
holders of the Preferred Securities issued by the applicable Financing Trust.
The holders of not less than a majority in aggregate liquidation amount of the
Preferred Securities issued by the applicable Financing Trust have the right to
direct the time, method and place of conducting any proceeding for any remedy
available in respect of the related Guarantee, including the giving of
directions of the Guarantee Trustee. If the Guarantee Trustee fails to enforce
such Guarantee, any holder of Preferred Securities relating to such Guarantee
may, after a period of 30 days has elapsed from such holder's written request to
the Guarantee Trustee to enforce the Guarantee, institute a legal proceeding
directly against the Company, as Guarantor, to enforce its rights under such
Guarantee without first instituting a legal proceeding against the applicable
Financing Trust, the Guarantee Trustee or any other person or entity.
Each Guarantee will constitute a guarantee of payment and not of
collection (that is, the guaranteed party may institute a legal proceeding
directly against the guarantor to enforce its rights under a Guarantee without
instituting a legal proceeding against any other person or entity).
DESCRIPTION OF THE OTHER UNITS
The Company may issue Other Units, which may include Common Stock,
Preferred Stock, Depositary Shares, Debt Securities, Common Stock Warrants,
Preferred Stock Warrants, Third Party Warrants, Debt Warrants, Stock Purchase
Contracts, Stock Purchase Units, Preferred Securities or Guarantees, or any
combination of the foregoing, either individually or as units consisting of one
or more of the foregoing, each on terms to be determined at the time of sale.
The related Prospectus Supplement will describe the terms of any Other
Units and the Securities which comprise such Other Units. See "Description of
the Common Stock," "Description of the Preferred Stock," "Description of the
Depositary Shares," "Description of the Debt Securities," "Description of the
Warrants to Purchase Common or Preferred Stock," "Description of the Third Party
Warrants," "Description of the Warrants to Purchase Debt Securities,"
"Description of Stock Purchase Contracts and Stock Purchase Units," "Description
of the Preferred Securities," and "Description of the Guarantees."
PLAN OF DISTRIBUTION
The Company or any Financing Trust may, from time to time, sell
Securities (1) through underwriters or dealers, (2) directly to one or more
purchasers, (3) through agents or (4) through a combination of any such methods
of sale. A Prospectus Supplement will set forth the terms of the offering of the
Securities offered thereby, including the name or names of any underwriters, the
purchase price of the Securities, and the proceeds to the Company or any
Financing Trust from the sale, any underwriting discounts and other items
constituting underwriters' compensation, any initial public offering price, any
discounts or concessions allowed or reallowed or paid to dealers, and any
securities exchange or market on which the Securities may be listed. Only
underwriters so named in such Prospectus Supplement are deemed to be
underwriters in connection with the Securities offered thereby.
If underwriters are used in the sale, the Securities will be acquired
by the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
obligations of the underwriters to purchase the Securities will be subject to
certain conditions precedent, and the underwriters will be obligated to purchase
all the Securities of the series offered by the Prospectus Supplement if any of
the Securities are purchased. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
In connection with underwritten offerings of Securities, certain
underwriters and selling group members and their respective affiliates may
engage in transactions that stabilize, maintain or otherwise affect the market
price of the Securities. Such transactions may include stabilization
transactions effected in accordance with Rule 104 of Regulation M under the
Exchange Act, pursuant to which such persons may bid for or purchase Securities
for the purposes of stabilizing their market price. The underwriters also may
create a short position for their respective accounts by selling more Securities
in connection with this offering than they are committed to purchase from the
Company, and in such case may purchase Securities in the open market following
completion of the offering to cover
-24-
all or a portion of such short position. The underwriters may also cover all or
a portion of such short position, up to a specified aggregate principal amount
or number of Securities, by exercising any underwriters' over-allotment option
that may be applicable with respect to the particular underwritten offering. In
addition, the managing underwriter for the particular offering, on behalf of the
underwriters, may impose "penalty bids" under contractual arrangements between
the underwriters whereby it may reclaim from an underwriter (or dealer
participating in this offering) for the account of the underwriters, the selling
concession with respect to Securities that are distributed in the relevant
offering but subsequently purchased for the account of the underwriters in the
open market. Any of the transactions described in this paragraph may result in
the maintenance of the price of the Securities at a level above that which might
otherwise prevail in the open market. None of the transactions described in this
paragraph is required, and, if any are undertaken, they may be discounted at any
time.
Securities may also be sold directly by the Company or a Financing
Trust or through agents designated by the Company or any Financing Trust from
time to time. Any agent involved in the offering and sale of Securities in
respect of which this Prospectus is delivered will be named, and any commissions
payable by the Company or a Financing Trust to such agent will be set forth in
the Prospectus Supplement. Unless otherwise indicated in the related Prospectus
Supplement, any such agent will be acting on a best-efforts basis for the period
of its appointment.
Securities offered other than Common Stock may be a new issue of
securities with no established trading market. Any underwriters to whom such
Securities are sold by the Company or a Financing Trust for public offering and
sale may make a market in such 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 such Securities.
Agents and underwriters may be entitled under agreements entered into
with the Company or a Financing Trust to indemnification by the Company or such
Financing Trust against certain civil liabilities, including liabilities under
the Securities Act or to contribution with respect to payments which the agents
or underwriters may be required to make in respect thereof. Agents and
underwriters may engage in transactions with, or perform services for, the
Company or any Financing Trust in the ordinary course of business.
Sales of the Securities may be effected by or for the account of one or
more of the Third Parties from time to time in transactions (which may include
block transactions) on any exchange or market on which such Securities are
listed or quoted, as applicable, in negotiated transactions, through a
combination of such methods of sale, or otherwise, at fixed prices that may be
changed, at market prices prevailing at the time of sale, at prices related to
prevailing market prices, or at negotiated prices. The Third Parties may effect
such transactions by selling the Securities directly to purchasers, acting as
principals for their own accounts, or by selling their Securities to or through
broker-dealers acting as agents for the Third Parties, or to broker-dealers who
may purchase Securities as principals and thereafter sell such Securities from
time to time in transactions on any exchange or market on which such Securities
are listed or quoted, as applicable, in negotiated transactions, through a
combination of such methods of sale, or otherwise. In effecting sales,
broker-dealers engaged by Third Parties may arrange for other broker-dealers to
participate. Such broker-dealers, if any, may receive compensation in the form
of discounts, concessions or commissions from the Third Parties and/or the
purchasers of the Securities for whom such broker-dealers may act as agents or
to whom they may sell as principals, or both (which compensation as to a
particular broker-dealer might be in excess of customary commissions).
In connection with distributions of shares of Common Stock or
otherwise, the Company may enter into hedging transactions with Counterparties
in connection with which such Counterparties may sell shares of Common Stock
registered hereunder in the course of hedging the positions they assume with the
Company. Such Counterparties may offer Common Stock through underwriters or
dealers, directly to one or more purchasers, or through agents, and may effect
sales in one or more transactions on the New York Stock Exchange or in
negotiated transactions or a combination of such methods of sale, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at other negotiated prices. The Company will not receive any of
the proceeds from the sale of Common Stock by Counterparties. A Counterparty may
be deemed to be an "underwriter" within the meaning of the Securities Act, and
any commission received by it and any profit on the resale of the Common Stock
purchased by it may be deemed to be underwriting commissions or discounts under
the Securities Act. The
-25-
Company may agree to bear all expenses of registration of any Common Stock
offered by Counterparties and may indemnify such Counterparties against certain
civil liabilities, including certain liabilities under the Securities Act.
ERISA AND TAX CONSIDERATIONS
The Employee Retirement Income Security Act of 1974, as amended
("ERISA"), imposes certain restrictions on investments by employee benefit plans
that are subject to ERISA. The Internal Revenue Code of 1986, as amended (the
"Code"), imposes additional restrictions on investments by tax-exempt retirement
plans, individual retirement accounts, and similar entities. The Code also
provides that certain types of income received by organizations that generally
are exempt from federal income tax will nevertheless be subject to taxation.
Retirement plans, tax-exempt organizations and similar entities should consult
their tax and legal advisors and the applicable Prospectus Supplement before
acquiring Securities.
LEGAL MATTERS
The legality of the Securities (other than the Preferred Securities)
offered hereby will be passed upon by Pillsbury Madison & Sutro LLP, San
Francisco, California, counsel for the Company. Certain matters of Delaware law
regarding the legality of the Preferred Securities will be passed upon by
Morris, Nichols, Arsht & Tunnell, Delaware, special Delaware counsel for the
Financing Trusts. Certain legal matters will be passed upon for the underwriters
by Cleary, Gottlieb, Steen & Hamilton, New York, New York, except as otherwise
set forth in a Prospectus Supplement.
EXPERTS
The consolidated financial statements incorporated by reference in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997 have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon incorporated by reference 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 accounting and auditing.
-26-
==================================================== ====================================================
NO DEALER, SALES REPRESENTATIVE, OR ANY OTHER
PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH
THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS OR ANY ACCOMPANYING PROSPECTUS
SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY PROVIDIAN FINANCIAL
CORPORATION, PROVIDIAN FINANCING I, PROVIDIAN
FINANCING II, PROVIDIAN FINANCING III OR PROVIDIAN
FINANCING IV OR BY ANY AGENT. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, ANY SECURITIES OTHER THAN THE
SECURITIES TO WHICH IT RELATES OR AN OFFER TO, OR
A SOLICITATION OF, ANY PERSON IN ANY JURISDICTION
WHERE SUCH AN OFFER OR SOLICITATION WOULD BE
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS,
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT NOR ANY
SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF PROVIDIAN
FINANCIAL CORPORATION, PROVIDIAN FINANCING I,
PROVIDIAN FINANCING II, PROVIDIAN FINANCING III OR
PROVIDIAN FINANCING IV OR THAT THE INFORMATION
CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY
TIME SUBSEQUENT TO THE DATE HEREOF OR THEREOF.
----------
TABLE OF CONTENTS
$2,000,000,000
Page
----
Index of Terms.................................. 4 PROVIDIAN FINANCIAL CORPORATION
Available Information........................... 5
Incorporation of Certain Documents COMMON STOCK
by Reference................................. 5 PREFERRED STOCK
Providian Financial Corporation................. 6 DEPOSITARY SHARES
The Financing Trusts............................ 6 DEBT SECURITIES
Use of Proceeds................................. 7 COMMON STOCK WARRANTS
Ratio of Earnings to Fixed Charges.............. 7 PREFERRED STOCK WARRANTS
General Description of Securities THIRD PARTY WARRANTS
and Risk Factors.............................. 7 DEBT WARRANTS
Description of the Common Stock................. 8 STOCK PURCHASE CONTRACTS
Description of the Preferred Stock.............. 9 STOCK PURCHASE UNITS
Description of the Depositary Shares............10 OTHER UNITS
Description of the Debt Securities..............12
Description of the Warrants to Purchase
Common Stock or Preferred Stock..............17 PROVIDIAN FINANCING I
Description of the Third Party Warrants.........18 PROVIDIAN FINANCING II
Description of the Warrants to Purchase PROVIDIAN FINANCING III
Debt Securities..............................20 PROVIDIAN FINANCING IV
Description of the Stock Purchase Contracts
and Stock Purchase Units.....................20
Description of the Preferred Securities.........21 PREFERRED SECURITIES,
Description of the Guarantees...................21 GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
Description of the Other Units..................24 PROVIDIAN FINANCIAL CORPORATION
Plan of Distribution............................24
ERISA and Tax Considerations....................26
Legal Matters...................................26 [Date]
Experts.........................................26
==================================================== ====================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.*
Securities and Exchange Commission Registration Fee........ $ 590,000
Printing Expenses.......................................... 200,000
Accounting Fees and Expenses............................... 300,000
Legal Fees and Expenses.................................... 400,000
Trustee Fees............................................... 40,000
Fees of Rating Agencies.................................... 200,000
Blue Sky Fees and Expenses................................. 25,000
Miscellaneous.............................................. 100,000
----------------
TOTAL...................................................... $ 1,855,000
================
* Estimated, except for the Securities and Exchange Commission Registration Fee.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law (the "Delaware
GCL") permits the Company's Board of Directors to indemnify any person against
expenses (including attorney's fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
any threatened, pending or completed action, suit or proceeding in which such
person is made a party by reason of his being or having been a director,
officer, employee or agent of the Company, in terms sufficiently broad to permit
such indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the Securities Act of 1933,
as amended (the "Securities Act"). Section 145 provides that indemnification
pursuant to its provisions is not exclusive of other rights of indemnification
to which a person may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors, or otherwise.
Article TENTH of the Company's Certificate of Incorporation provides
for indemnification of its directors and officers to the maximum extent
permitted by the Delaware GCL. The Company's Bylaws contain provisions
implementing such indemnification of directors and officers. The Company may, by
action of its Board of Directors, provide indemnification for its employees and
agents to the maximum extent provided by law.
As permitted by Sections 102 and 145 of the Delaware GCL, Article TENTH
of the Company's Certificate of Incorporation eliminates a director's personal
liability for monetary damage to the Company and its stockholders arising from a
breach of a director's fiduciary duty except to the extent not permitted under
the Delaware GCL.
The Declaration of each Financing Trust provides that no Financing
Trustee, affiliate of any Financing Trustee, or any officer, director,
shareholder, member, partner, employee, representative or agent of any Financing
Trustee, or any employee or agent of such Financing Trust or its affiliates
(each an "Indemnified Person"), shall be liable, responsible or accountable in
damages or otherwise to such Financing Trust or any employee or agent of the
trust or its affiliates for any loss, damage or claim incurred by reason of any
act or omission performed or admitted by such Indemnified Person in good faith
on behalf of such Financing Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of the authority conferred on such
Indemnified Person by such Declaration or by law, except that an Indemnified
Person shall be liable for any such loss, damage or claim incurred by reason of
such Indemnified Person's gross negligence (or, in the case of the Property
Trustee, negligence) or willful misconduct with respect to such acts or
omissions. The Declaration of each Financing Trust also provides that to the
fullest extent permitted by applicable law, the Company shall indemnify and hold
harmless each Indemnified Person from and against any loss, damage or claim
incurred by such Indemnified Person by reason of any act or omission performed
or omitted by such Indemnified Person in good faith on behalf of such Financing
Trust and in a manner such Indemnified Person reasonably believed to be within
the scope of authority conferred on such Indemnified Person by such Declaration
except that no Indemnified Person shall be entitled to be
II-1
indemnified in respect of any loss, damage or claim incurred by such Indemnified
Person by reason of gross negligence (or, in the case of the Property Trustee,
negligence) or willful misconduct with respect to such acts or omissions. The
Declaration of each Financing Trust further provides that, to the fullest extent
permitted by applicable law, expenses (including legal fees) incurred by an
Indemnified Person in defending any claim, demand, action, suit or proceeding
shall, from time to time, be advanced by the Company prior to the final
disposition of such claim, demand, action, suit or proceeding upon receipt by or
an undertaking by or on behalf of the Indemnified Person to repay such amount if
it shall be determined that the Indemnified Person is not entitled to be
indemnified for the underlying cause of action as authorized by such
Declaration.
The directors and officers of the Company and the Administrators are
covered by insurance policies indemnifying against certain liabilities,
including certain liabilities arising under the Securities Act, which might be
incurred by them in such capacities and against which they cannot be indemnified
by the Company or Financing Trusts.
Any agents, dealers or underwriters who execute any of the agreements
filed as Exhibit 1 to this registration statement will agree to indemnify the
Company's directors and their officers and the Financing Trustees who signed the
registration statement against certain liabilities that may arise under the
Securities Act with respect to information furnished to the Company or any of
the Financing Trusts by or on behalf of any such indemnifying party.
ITEM 16. EXHIBITS.
Exhibits identified in parentheses below, on file with the Commission,
are incorporated by reference as exhibits hereto.
1.1 Form of Underwriting Agreement (Debt Securities).
1.2 Form of Underwriting Agreement (Equity Securities).
4.1 Amended and Restated Certificate of Incorporation of the
Company (filed as Exhibit 3.1 to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1997, filed
on August 14, 1997, File No. 1-12897, and incorporated by
reference herein).
4.2 Amended and Restated Bylaws of the Company (filed as Exhibit
3.2 to the Company's Annual Report on Form 10-K for the year
ended December 31, 1997, filed March 31, 1998, File No.
1-12897, and incorporated by reference herein).
4.3 Rights Agreement, dated as of June 1, 1997, between the
Company and First Chicago Trust Company of New York (filed as
Exhibit 10.1 to the Company's quarterly report on Form 10-Q
for the quarter ended June 30, 1997, filed on August 14, 1997,
File No. 1-12897, and incorporated by reference herein).
4.4 Certificate of Designation of Series A Junior Participating
Preferred Stock, dated June 1, 1997 (filed as Exhibit 4.1 to
the Company's quarterly report on Form 10-Q for the quarter
ended June 30, 1997, filed on August 14, 1997, File No.
1-12897, and incorporated by reference herein).
4.5 Certificate of Trust of Providian Capital I, dated as of
January 21, 1997 (filed as Exhibit 4.3 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1997,
filed March 31, 1998, File No. 1-12897, and incorporated by
reference herein).
4.6 Amended and Restated Trust Agreement, dated as of February 4,
1997, among the Company, as Depositor, The Bank of New York,
as Property Trustee, and The Bank of New York (Delaware), as
Delaware Trustee (filed as Exhibit 4.4 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1997,
filed March 31, 1998, File No. 1-12897, and incorporated by
reference herein).
II-2
4.7 Junior Subordinated Indenture, dated as of February 4, 1997,
between the Company and The Bank of New York, as Trustee
(filed as Exhibit 4.5 to the Company's Annual Report on Form
10-K for the year ended December 31, 1997, filed March 31,
1998, File No. 1-12897, and incorporated by reference herein).
4.8 Guarantee Agreement, dated as of February 4, 1997, between the
Company, as Guarantor, and The Bank of New York, as Trustee
(filed as Exhibit 4.6 to the Company's Annual Report on Form
10-K for the year ended December 31, 1997, filed March 31,
1998, File No. 1-12897, and incorporated by reference herein).
4.9 Certificate of Trust of Providian Financing I.
4.10 Certificate of Trust of Providian Financing II.
4.11 Certificate of Trust of Providian Financing III.
4.12 Certificate of Trust of Providian Financing IV.
4.13 Form of Amended and Restated Declaration of Trust of Providian
Financing I, Providian Financing II, Providian Financing III
and Providian Financing IV.
4.14 Form of Pledge Agreement.
4.15 Form of Senior Indenture.
4.16 Form of Standard Stock Warrant Provisions.
4.17 Form of Debt Securities Warrant Agreement.
4.18 Form of Deposit Agreement.
4.19 Form of Subordinated Indenture.
4.20 Form of Preferred Securities Guarantee Agreement.
4.21 Form of Stock Purchase Contract Agreement.
4.22 Form of Master Unit Agreement.
4.23 Form of Master Unit Pledge Agreement.
4.24 Form of Call Option Agreement.
5.1(a) Opinion of Pillsbury Madison & Sutro LLP.
5.1(b) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing I).
5.1(c) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing II).
5.1(d) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing III).
5.1(e) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing IV).
12.1 Statement re Computation of Ratios.
II-3
23.1 Consent of Ernst & Young LLP, independent accountants.
23.2 Consent of Pillsbury Madison & Sutro LLP (included in Exhibit
5.1(a)).
23.3 Consent of Morris, Nichols, Arsht & Tunnell (included in
Exhibits 5.1(b), 5.1(c) and 5.1(d) and 5.1(e)).
24.1 Power of Attorney (Providian Financial Corporation) (included
on page II-6).
24.2 Power of Attorney (Providian Financing I) (included on page
II-8).
24.3 Power of Attorney (Providian Financing II) (included on page
II-8).
24.4 Power of Attorney (Providian Financing III) (included on page
II-8).
24.5 Power of Attorney (Providian Financing IV) (included on page
II-8).
ITEM 17. UNDERTAKINGS.
Providian Financial Corporation, Providian Financing I, Providian
Financing II, Providian Financing III and Providian Financing IV (the
"Registrants") hereby undertake:
(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 and 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 a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective Registration Statement.
(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 (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by Providian Financial Corporation pursuant to Section 13 or Section
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.
(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.
II-4
The Registrants hereby undertake that, for purposes of determining any
liability under the Securities Act of 1933, each filing of Providian Financial
Corporation's annual report pursuant to Section 13(a) or 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.
Providian Financing I, Providian Financing II, Providian Financing III
and Providian Financing IV each 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
the Registrants pursuant to the provisions described in Item 15 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 Securities Act of 1933 and is, therefore, unenforceable. If a claim for
indemnification against such liabilities (other than the payment by the
Registrants of expenses incurred or paid by a director, officer or controlling
person of the Registrants 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, the Registrants, will, unless
in the opinion of 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 Securities
Act of 1933 and will be governed by the final adjudication of such issue.
The Registrants hereby undertake to file an application for the purpose
of determining the eligibility of the trustee to act under Subsection (a) of
Section 310 of the Trust Indenture Act of 1939 in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Trust
Indenture Act of 1939.
The Registrants hereby undertake 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 a form
of Prospectus filed by the Registrants pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act of 1933 shall be deemed to be part of this
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-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 Registration
Statement to be signed on its behalf by the undersigned, hereunto duly
authorized, in the City of San Francisco, State of California, on June 3, 1998.
PROVIDIAN FINANCIAL CORPORATION
By /s/ SHAILESH J. MEHTA
-------------------------------------------
Shailesh J. Mehta
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each of the undersigned hereby
constitutes and appoints David J. Petrini, Daniel Sanford, Ellen Richey, Ronald
Claveloux, and Clifford Shapiro, and each of them, his/her attorneys for him/her
in his stead, in each of his/her offices and capacities as an officer, director,
or both of the Company, to sign and to file with the Commission such
Registration Statements on Form S-3, and any and all amendments, modifications,
or supplements thereto, and any exhibits thereto, and grants to each of said
attorneys full power and authority to sign and file any and all other documents
and to perform and do all and every act and thing whatsoever requisite and
necessary to be done in and about the premises as fully, to all intents and
purposes, as he/she might or could do if personally present at the doing
thereof, and hereby ratifies and confirms all that said attorneys may or shall
lawfully do, or cause to be done, by virtue hereof in connection with the
registration of the aforesaid securities.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons and in the
capacities indicated on the 3rd day of June, 1998.
Name Title
/s/ SHAILESH J. MEHTA Chairman, President and Chief Executive
- -------------------------- Officer and Director
Shailesh J. Mehta
/s/ DAVID J. PETRINI Senior Vice President, Chief Financial
- -------------------------- Officer and Treasurer (Principal Financial
David J. Petrini Officer)
/s/ DANIEL SANFORD Vice President and Controller (Principal
- -------------------------- Accounting Officer)
Daniel Sanford
/s/ JOHN M. CRANOR III Director
- --------------------------
John M. Cranor III
/s/ CHRISTINA L. DARWALL Director
- --------------------------
Christina L. Darwall
II-6
/s/ JAMES V. ELLIOTT Director
- --------------------------
James V. Elliott
/s/ LYLE EVERINGHAM Director
- --------------------------
Lyle Everingham
/s/ J. DAVID GRISSOM Director
- --------------------------
J. David Grissom
/s/ F. WARREN MCFARLAN Director
- --------------------------
F. Warren McFarlan
/s/ RUTH M. OWADES Director
- --------------------------
Ruth M. Owades
/s/ LARRY D. THOMPSON Director
- --------------------------
Larry D. Thompson
/s/ JOHN L. WEINBERG Director
- --------------------------
John L. Weinberg
II-7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of
Providian Financing I, Providian Financing II, Providian Financing III and
Providian Financing 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
Registration Statement to be signed on its behalf by the undersigned, hereunto
duly authorized, in the City of San Francisco, State of California, on June 3,
1998.
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each of the undersigned hereby
constitutes and appoints David J. Petrini, Daniel Sanford, Ellen Richey, Ronald
Claveloux, and Clifford Shapiro, and each of them, his/her attorneys for him/her
in his/her stead, in each of his/her offices and capacities as an administrator
of Providian Financing I, Providian Financing II, Providian Financing III and
Providian Financing IV to sign and to file with the Commission such Registration
Statements on Form S-3, and any and all amendments, modifications or supplements
thereto, and any exhibits thereto, and grants to each of said attorneys full
power and authority to sign and file any and all other documents and to perform
and do all and every act and thing whatsoever requisite and necessary to be done
in and about the premises as fully, to all intents and purposes, as he/she might
or could do if personally present at the doing thereof, and hereby ratifies and
confirms all that said attorneys may or shall lawfully do, or cause to be done,
by virtue hereof in connection with the registration of the aforesaid
securities.
PROVIDIAN FINANCING I
By /s/ DAVID J. PETRINI
--------------------------------------
David J. Petrini, Administrator
By /s/ DANIEL SANFORD
--------------------------------------
Daniel Sanford, Administrator
By /s/ KIRK INGLIS
--------------------------------------
Kirk Inglis, Administrator
PROVIDIAN FINANCING II
By /s/ DAVID J. PETRINI
--------------------------------------
David J. Petrini, Administrator
By /s/ DANIEL SANFORD
--------------------------------------
Daniel Sanford, Administrator
By /s/ KIRK INGLIS
--------------------------------------
Kirk Inglis, Administrator
II-8
PROVIDIAN FINANCING III
By /s/ DAVID J. PETRINI
--------------------------------------
David J. Petrini, Administrator
By /s/ DANIEL SANFORD
--------------------------------------
Daniel Sanford, Administrator
By /s/ KIRK INGLIS
--------------------------------------
Kirk Inglis, Administrator
PROVIDIAN FINANCING IV
By /s/ DAVID J. PETRINI
--------------------------------------
David J. Petrini, Administrator
By /s/ DANIEL SANFORD
--------------------------------------
Daniel Sanford, Administrator
By /s/ KIRK INGLIS
--------------------------------------
Kirk Inglis, Administrator
II-9
EXHIBIT INDEX
1.1 Form of Underwriting Agreement (Debt Securities).
1.2 Form of Underwriting Agreement (Equity Securities).
4.1 Amended and Restated Certificate of Incorporation of the
Company (filed as Exhibit 3.1 to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1997, filed
on August 14, 1997, File No. 1-12897, and incorporated by
reference herein).
4.2 Amended and Restated Bylaws of the Company (filed as Exhibit
3.2 to the Company's Annual Report on Form 10-K for the year
ended December 31, 1997, filed March 31, 1998, File No.
1-12897, and incorporated by reference herein).
4.3 Certificate of Designation of Series A Junior Participating
Preferred Stock, dated June 1, 1997 (filed as Exhibit 4.1 to
the Company's quarterly report on Form 10-Q for the quarter
ended June 30, 1997, filed on August 14, 1997, File No.
1-12897, and incorporated by reference herein).
4.4 Rights Agreement, dated as of June 1, 1997, between the
Company and First Chicago Trust Company of New York (filed as
Exhibit 10.1 to the Company's quarterly report on Form 10-Q
for the quarter ended June 30, 1997, filed on August 14, 1997,
File No. 1-12897, and incorporated by reference herein).
4.5 Certificate of Trust of Providian Capital I, dated as of
January 21, 1997 (filed as Exhibit 4.3 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1997,
filed March 31, 1998, File No. 1-12897, and incorporated by
reference herein).
4.6 Amended and Restated Trust Agreement, dated as of February 4,
1997, among the Company, as Depositor, The Bank of New York,
as Property Trustee, and The Bank of New York (Delaware), as
Delaware Trustee (filed as Exhibit 4.4 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1997,
filed March 31, 1998, File No. 1-12897, and incorporated by
reference herein).
4.7 Junior Subordinated Indenture, dated as of February 4, 1997,
between the Company and The Bank of New York, as Trustee
(filed as Exhibit 4.5 to the Company's Annual Report on Form
10-K for the year ended December 31, 1997, filed March 31,
1998, File No. 1-12897, and incorporated by reference herein).
4.8 Guarantee Agreement, dated as of February 4, 1997, between the
Company, as Guarantor, and The Bank of New York, as Trustee
(filed as Exhibit 4.6 to the Company's Annual Report on Form
10-K for the year ended December 31, 1997, filed March 31,
1998, File No. 1-12897, and incorporated by reference herein).
4.9 Certificate of Trust of Providian Financing I.
4.10 Certificate of Trust of Providian Financing II.
4.11 Certificate of Trust of Providian Financing III.
4.12 Certificate of Trust of Providian Financing IV.
4.13 Form of Amended and Restated Declaration of Trust of Providian
Financing I, Providian Financing II, Providian Financing III
and Providian Financing IV.
4.14 Form of Pledge Agreement.
II-10
4.15 Form of Senior Indenture.
4.16 Form of Standard Stock Warrant Provisions.
4.17 Form of Debt Securities Warrant Agreement.
4.18 Form of Deposit Agreement.
4.19 Form of Subordinated Indenture.
4.20 Form of Preferred Securities Guarantee Agreement.
4.21 Form of Stock Purchase Contract Agreement.
4.22 Form of Master Unit Agreement.
4.23 Form of Master Unit Pledge Agreement.
4.24 Form of Call Option Agreement.
5.1(a) Opinion of Pillsbury Madison & Sutro LLP.
5.1(b) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing I).
5.1(c) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing II).
5.1(d) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing III).
5.1(e) Opinion of Morris, Nichols, Arsht & Tunnell (Providian
Financing IV).
12.1 Statement re Computation of Ratios.
23.1 Consent of Ernst & Young LLP, independent accountants.
23.2 Consent of Pillsbury Madison & Sutro LLP (included in Exhibit
5.1(a)).
23.3 Consent of Morris, Nichols, Arsht & Tunnell (included in
Exhibits 5.1(b), 5.1(c) and 5.1(d) and 5.1(e)).
24.1 Power of Attorney (Providian Financial Corporation) (included
on page II-6).
24.2 Power of Attorney (Providian Financing I) (included on page
II-8).
24.3 Power of Attorney (Providian Financing II) (included on page
II-8).
24.4 Power of Attorney (Providian Financing III) (included on page
II-8).
24.5 Power of Attorney (Providian Financing IV) (included on page
II-8).
II-11