AMENDED AND RESTATED TRUST AGREEMENT
among
TEXAS CAPITAL BANCSHARES, INC.,
as Depositor
WILMINGTON TRUST COMPANY,
as Property Trustee
WILMINGTON TRUST COMPANY,
as Delaware Trustee
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
as Administrative Trustees
Dated as of September 29, 2006
TEXAS CAPITAL STATUTORY TRUST V
TABLE OF CONTENTS
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Page
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ARTICLE I. Defined Tearms
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1
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SECTION 1.1. Definitions
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1
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ARTICLE II. The Trust
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11
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SECTION 2.1. Name
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11
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SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business
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11
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SECTION 2.3. Initial Contribution of Trust Property; Fees, Costs and Expenses
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11
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SECTION 2.4. Purposes of Trust
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11
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SECTION 2.5. Authorization to Enter into Certain Transactions
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12
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SECTION 2.6. Assets of Trust
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14
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SECTION 2.7. Title to Trust Property
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14
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ARTICLE III. Payment Account; Paying Agents
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15
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SECTION 3.1. Payment Account
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15
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SECTION 3.2. Appointment of Paying Agents
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15
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ARTICLE IV. Distributions; Redemption
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16
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SECTION 4.1. Distributions
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16
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SECTION 4.2. Redemption
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17
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SECTION 4.3. Subordination of Common Securities
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20
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SECTION 4.4. Payment Procedures
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21
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SECTION 4.5. Withholding Tax
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21
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SECTION 4.6. Tax Returns and Other Reports
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21
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SECTION 4.7. Payment of Taxes, Duties, Etc. of the Trust
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22
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SECTION 4.8. Payments under Indenture or Pursuant to Direct Actions
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22
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SECTION 4.9. Exchanges
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22
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SECTION 4.10. Calculation Agent
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23
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SECTION 4.11. Certain Accounting Matters
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23
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ARTICLE V. Securities
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24
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SECTION 5.1. Initial Ownership
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24
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SECTION 5.2. Authorized Trust Securities
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24
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SECTION 5.3. Issuance of the Common Securities; Subscription and Purchase of Notes
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24
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SECTION 5.4. The Securities Certificates
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24
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SECTION 5.5. Rights of Holders
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25
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SECTION 5.6. Book-Entry Preferred Securities
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25
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SECTION 5.7. Registration of Transfer and Exchange of Preferred Securities Certificates
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27
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SECTION 5.8. Mutilated, Destroyed, Lost or Stolen Securities Certificates
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28
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SECTION 5.9. Persons Deemed Holders
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29
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SECTION 5.10. Cancellation
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29
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SECTION 5.11. Ownership of Common Securities by Depositor
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30
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SECTION 5.12. Restricted Legends
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30
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SECTION 5.13. Form of Certificate of Authentication
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33
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ARTICLE VI. Meetings; Voting; Acts of Holders
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33
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SECTION 6.1. Notice of Meetings
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33
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i
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Page
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SECTION 6.2. Meetings of Holders of the Preferred Securities
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33
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SECTION 6.3. Voting Rights
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34
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SECTION 6.4. Proxies
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34
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SECTION 6.5. Holder Action by Written Consent
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34
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SECTION 6.6. Record Date for Voting and Other Purposes
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35
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SECTION 6.7. Acts of Holders
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35
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SECTION 6.8. Inspection of Records
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36
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SECTION 6.9. Limitations on Voting Rights
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36
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SECTION 6.10. Acceleration of Maturity; Rescission of Annulment; Waivers of Past Defaults
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37
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ARTICLE VII. Representations and Warranties
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39
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SECTION 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee
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39
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SECTION 7.2. Representations and Warranties of Depositor
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40
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ARTICLE VIII. The Trustees
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41
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SECTION 8.1. Number of Trustees
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41
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SECTION 8.2. Property Trustee Required
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41
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SECTION 8.3. Delaware Trustee Required
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41
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SECTION 8.4. Appointment of Administrative Trustees
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42
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SECTION 8.5. Duties and Responsibilities of the Trustees
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42
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SECTION 8.6. Notices of Defaults and Extensions
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44
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SECTION 8.7. Certain Rights of Property Trustee
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44
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SECTION 8.8. Delegation of Power
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46
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SECTION 8.9. May Hold Securities
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47
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SECTION 8.10. Compensation; Reimbursement; Indemnity
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47
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SECTION 8.11. Resignation and Removal; Appointment of Successor
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48
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SECTION 8.12. Acceptance of Appointment by Successor
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49
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SECTION 8.13. Merger, Conversion, Consolidation or Succession to Business
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49
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SECTION 8.14. Not Responsible for Recitals or Issuance of Securities
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50
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SECTION 8.15. Property Trustee May File Proofs of Claim
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50
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SECTION 8.16. Reports to and from the Property Trustee
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51
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ARTICLE IX. Termination, Liquidation and Merger
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51
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SECTION 9.1. Dissolution Upon Expiration Date
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51
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SECTION 9.2. Early Termination
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51
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SECTION 9.3. Termination
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52
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SECTION 9.4. Liquidation
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52
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SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements of Trust
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53
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ARTICLE X. Information to Purchaser
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55
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SECTION 10.1. Depositor Obligations to Purchaser
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55
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SECTION 10.2. Trustees Obligations to Purchaser
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55
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ARTICLE XI. Miscellaneous Provisions
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55
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SECTION 11.1. Limitation of Rights of Holders
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55
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SECTION 11.2. Agreed Tax Treatment of Trust and Trust Securities
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55
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SECTION 11.3. Amendment
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56
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SECTION 11.4. Separability
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57
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SECTION 11.5. Governing Law
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57
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SECTION 11.6. Successors
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57
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ii
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Page
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SECTION 11.7. Headings
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57
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SECTION 11.8. Reports, Notices and Demands
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58
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SECTION 11.9. Agreement Not to Petition
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58
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Exhibit A
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Certificate of Trust of Texas Capital Statutory Trust V
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Exhibit B
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Form of Common Securities Certificate
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Exhibit C
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Form of Preferred Securities Certificate
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Exhibit D
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Junior Subordinated Indenture
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Exhibit E
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Form of Transferee Certificate to be Executed by Transferees other than QIBs
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Exhibit F
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Form of Transferee Certificate to be Executed by QIBs
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Exhibit G
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Form of Officers Certificate
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Schedule A
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Calculation of LIBOR
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iii
AMENDED AND RESTATED TRUST AGREEMENT, dated as of September 29, 2006, among (i) Texas Capital
Bancshares, Inc., a Delaware corporation (including any successors or permitted assigns, the
Depositor), (ii) Wilmington Trust Company, a Delaware banking corporation, as property trustee
(in such capacity, the Property Trustee), (iii) Wilmington Trust Company, a Delaware banking
corporation, as Delaware trustee (in such capacity, the Delaware Trustee), (iv) Joseph M. Grant,
an individual and Peter Bartholow, each of whose address is c/o Texas Capital Bancshares, Inc.,
2100 McKinney Avenue, Suite 900, Dallas, Texas 75201, as administrative trustees (in such
capacities, each an Administrative Trustee and, collectively, the Administrative Trustees and,
together with the Property Trustee and the Delaware Trustee, the Trustees) and (v) the several
Holders, as hereinafter defined.
Witnesseth
Whereas
, the Depositor, the Property Trustee and the Delaware Trustee have heretofore
created a Delaware statutory trust pursuant to the Delaware Statutory Trust Act, as hereinafter
defined, by entering into a Trust Agreement, dated as of September 27, 2006 (the Original Trust
Agreement), and by executing and filing with the Secretary of State of the State of Delaware the
Certificate of Trust, substantially in the form attached as
Exhibit A
; and
Whereas,
the Depositor and the Trustees desire to amend and restate the Original
Trust Agreement in its entirety as set forth herein to provide for, among other things, (i) the
issuance of the Common Securities by the Trust to the Depositor, (ii) the issuance and sale of the
Preferred Securities by the Trust pursuant to the Subscription Agreement and (iii) the acquisition
by the Trust from the Depositor of all of the right, title and interest in and to the Notes (as
defined herein);
Now, Therefore,
in consideration of the agreements and obligations set forth herein
and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each party, for the benefit of the other parties and for the benefit of the Holders
(as defined herein), hereby amends and restates the Original Trust Agreement in its entirety and
agrees as follows:
ARTICLE I.
Defined Terms
SECTION 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
(a) the terms defined in this
Article I
have the meanings assigned to them in
this Article I;
(b) the words include, includes and including shall be deemed to be followed by
the phrase without limitation;
(c) all accounting terms used but not defined herein have the meanings assigned to them
in accordance with United States generally accepted accounting principles;
(d) unless the context otherwise requires, any reference to an Article, a Section,
a Schedule or an Exhibit refers to an Article, a Section, a Schedule or an Exhibit, as
the case may be, of or to this Trust Agreement;
(e) the words hereby, herein, hereof and hereunder and other words of similar
import refer to this Trust Agreement as a whole and not to any particular Article, Section
or other subdivision;
(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include the masculine,
feminine and neuter genders.
Act has the meaning specified in
Section 6.7
.
Additional Interest has the meaning specified in
Section 1.1
of the Indenture.
Additional Interest Amount means, with respect to Trust Securities of a given Liquidation
Amount and/or a given period, the amount of Additional Interest paid by the Depositor on a Like
Amount of Notes for such period.
Additional Taxes has the meaning specified in
Section 1.1
of the Indenture.
Additional Tax Sums has the meaning specified in
Section 10.5
of the Indenture.
Administrative Trustee means each of the Persons identified as an Administrative Trustee
in the preamble to this Trust Agreement, solely in each such Persons capacity as Administrative
Trustee of the Trust and not in such Persons individual capacity, or any successor Administrative
Trustee appointed as herein provided.
Affiliate of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, control when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms controlling and
controlled have meanings correlative to the foregoing.
Applicable Depositary Procedures means, with respect to any transfer or transaction
involving a Book-Entry Preferred Security, the rules and procedures of the Depositary for such
Book-Entry Preferred Security, in each case to the extent applicable to such transaction and as in
effect from time to time.
2
Bankruptcy Event means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in the premises (i)
adjudging such Person a bankrupt or insolvent, (ii) approving as properly filed a petition
seeking reorganization, arrangement, adjudication or composition of or in respect of such
Person under any applicable Federal or state bankruptcy, insolvency, reorganization or other
similar law, (iii) appointing a custodian, receiver, conservator, liquidator, assignee,
trustee, sequestrator or other similar official of such Person or of any substantial part of
its property or (iv) ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a period of sixty (60)
consecutive days; or
(b) the institution by such Person of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency proceedings
against it, or the filing by it of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or state bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to the appointment
of a custodian, receiver, conservator, liquidator, assignee, trustee, sequestrator or
similar official of such Person or of any substantial part of its property, or the making by
it of an assignment for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due and its willingness to be
adjudicated a bankrupt or insolvent, or the taking of corporate action by such Person in
furtherance of any such action.
Bankruptcy Laws means all Federal and state bankruptcy, insolvency, reorganization and other
similar laws, including the United States Bankruptcy Code.
Book-Entry Preferred Security means a Preferred Security, the ownership and transfers of
which shall be made through book entries by a Depositary.
Business Day means a day other than (a) a Saturday or Sunday, (b) a day on which banking
institutions in the City of New York are authorized or required by law or executive order to remain
closed or (c) a day on which the Corporate Trust Office is closed for business.
Calculation Agent has the meaning specified in
Section 4.10
.
Capital Disqualification Event has the meaning specified in
Section 1.1
of the
Indenture.
Closing Date has the meaning specified in the Placement Agreement.
Code means the United States Internal Revenue Code of 1986, as amended.
Commission means the Securities and Exchange Commission, as from time to time constituted,
created under the Exchange Act or, if at any time after the execution of this Trust Agreement such
Commission is not existing and performing the duties assigned to it, then the body performing such
duties at such time.
Common Securities Certificate means a certificate evidencing ownership of Common Securities,
substantially in the form attached as
Exhibit B
.
3
Common Security means an undivided beneficial interest in the assets of the Trust, having a
Liquidation Amount of $1,000 and having the rights provided therefor in this Trust Agreement.
Corporate Trust Office means the principal office of the Property Trustee at which any
particular time its corporate trust business shall be administered, which office at the date of
this Trust Agreement is located at Rodney Square North, 1100 North Market Street, Wilmington,
Delaware 19890-1600, Attention: Corporate Trust Administration.
Definitive Preferred Securities Certificates means Preferred Securities issued in
certificated, fully registered form that are not Global Preferred Securities.
Delaware Statutory Trust Act means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code
§ 3801 et seq., or any successor statute thereto, in each case as amended from time to time.
Delaware Trustee means the Person identified as the Delaware Trustee in the preamble to
this Trust Agreement, solely in its capacity as Delaware Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any successor Delaware
Trustee appointed as herein provided.
Depositary means an organization registered as a clearing agency under the Exchange Act that
is designated as Depositary by the Depositor or any successor thereto. DTC will be the initial
Depositary.
Depositary Participant means a broker, dealer, bank, other financial institution or other
Person for whom from time to time the Depositary effects book-entry transfers and pledges of
securities deposited with the Depositary.
Depositor has the meaning specified in the preamble to this Trust Agreement and any
successors and permitted assigns.
Depositor Affiliate has the meaning specified in
Section 4.9
.
Distribution Date has the meaning specified in
Section 4.1(a)(i)
.
Distributions means amounts payable in respect of the Trust Securities as provided in
Section 4.1
.
DTC means The Depository Trust Company or any successor thereto.
Early Termination Event has the meaning specified in
Section 9.2
.
Event of Default means any one of the following events (whatever the reason for such event
and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or regulation of any administrative
or governmental body):
4
(a) the occurrence of a Note Event of Default; or
(b) default by the Trust in the payment of any Distribution when it becomes due and
payable, and continuation of such default for a period of thirty (30) days (subject to the
deferral of any due date in the case of any Extension Period); or
(c) default by the Trust in the payment of any Redemption Price of any Trust Security
when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect of any covenant or
warranty of the Trustees in this Trust Agreement (other than those specified in clause (b)
or (c) above) and continuation of such default or breach for a period of thirty (30) days
after there has been given, by registered or certified mail, to the Trustees and to the
Depositor by the Holders of at least twenty five percent (25%) in aggregate Liquidation
Amount of the Outstanding Preferred Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a Notice of Default
hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property Trustee if a
successor Property Trustee has not been appointed within ninety (90) days thereof.
Exchange Act means the Securities Exchange Act of 1934, and any successor statute thereto,
in each case as amended from time to time.
Expiration Date has the meaning specified in
Section 9.1
.
Extension Period has the meaning specified in
Section 4.1(a)(ii)
.
Federal Reserve means the Board of Governors of the Federal Reserve System, the staff
thereof, or a Federal Reserve Bank, acting through delegated authority, in each case under the
rules, regulations and policies of the Federal Reserve System, or if at any time after the
execution of this Trust Agreement any such entity is not existing and performing the duties now
assigned to it, any successor body performing similar duties or functions.
Fiscal Year shall be the fiscal year of the Trust, which shall be the calendar year, or such
other period as is required by the Code.
Global Preferred Security means a Preferred Securities Certificate evidencing ownership of
Book-Entry Preferred Securities.
Guarantee Agreement means the Guarantee Agreement executed and delivered by the Depositor
and Wilmington Trust Company, as guarantee trustee, contemporaneously with the execution and
delivery of this Trust Agreement for the benefit of the holders of the Preferred Securities, as
amended from time to time.
Holder means a Person in whose name a Trust Security or Trust Securities are registered in
the Securities Register; any such Person shall be a beneficial owner within the meaning of the
Delaware Statutory Trust Act.
5
Indemnified Person has the meaning specified in
Section 8.10(c)
.
Indenture means the Junior Subordinated Indenture executed and delivered by the Depositor
and the Note Trustee contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the holders of the Notes, a copy of which is attached hereto as
Exhibit D
,
as amended or supplemented from time to time.
Indenture Redemption Price has the meaning specified in
Section 4.2(c)
.
Interest Payment Date has the meaning specified in
Section 1.1
of the Indenture.
Investment Company Act means the Investment Company Act of 1940, or any successor statute
thereto, in each case as amended from time to time.
Investment Company Event has the meaning specified in
Section 1.1
of the Indenture.
LIBOR has the meaning specified in
Schedule A
.
LIBOR Business Day has the meaning specified in
Schedule A
.
LIBOR Determination Date has the meaning specified in
Schedule A
.
Lien means any lien, pledge, charge, encumbrance, mortgage, deed of trust, adverse ownership
interest, hypothecation, assignment, security interest or preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever.
Like Amount means (a) with respect to a redemption of any Trust Securities, Trust Securities
having a Liquidation Amount equal to the principal amount of Notes to be contemporaneously redeemed
or paid at maturity in accordance with the Indenture, the proceeds of which will be used to pay the
Redemption Price of such Trust Securities, (b) with respect to a distribution of Notes to Holders
of Trust Securities in connection with a dissolution of the Trust, Notes having a principal amount
equal to the Liquidation Amount of the Trust Securities of the Holder to whom such Notes are
distributed and (c) with respect to any distribution of Additional Interest Amounts to Holders of
Trust Securities, Notes having a principal amount equal to the Liquidation Amount of the Trust
Securities in respect of which such distribution is made.
Liquidation Amount means the stated amount of $1,000 per Trust Security.
Liquidation Date means the date on which assets are to be distributed to Holders in
accordance with
Section 9.4(a)
hereunder following dissolution of the Trust.
Liquidation Distribution has the meaning specified in
Section 9.4(d)
.
Majority in Liquidation Amount of the Preferred Securities means Preferred Securities
representing more than fifty percent (50%) of the aggregate Liquidation Amount of all (or a
specified group of) then Outstanding Preferred Securities.
6
Note Event of Default means any Event of Default specified in
Section 5.1
of the
Indenture.
Note Redemption Date means, with respect to any Notes to be redeemed under the Indenture,
the date fixed for redemption of such Notes under the Indenture.
Note Trustee means the Person identified as the Trustee in the Indenture, solely in its
capacity as Trustee pursuant to the Indenture and not in its individual capacity, or its successor
in interest in such capacity, or any successor Trustee appointed as provided in the Indenture.
Notes means the Depositors Floating Rate Junior Subordinated Notes issued pursuant to the
Indenture.
Office of Thrift Supervision means the Office of Thrift Supervision, as from time to time
constituted or, if at any time after the execution of this Trust Agreement such Office is not
existing and performing the duties now assigned to it, then the body performing such duties at such
time.
Officers Certificate means a certificate signed by the Chief Executive Officer, the
President or an Executive Vice President, and by the Chief Financial Officer, Treasurer or an
Assistant Treasurer, of the Depositor, and delivered to the Trustees. Any Officers Certificate
delivered with respect to compliance with a condition or covenant provided for in this Trust
Agreement (other than the Officers Certificate provided pursuant to
Section 8.16(a)
) shall
include:
(a) a statement by each officer signing the Officers Certificate that such officer has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or investigation
undertaken by such officer in rendering the Officers Certificate;
(c) a statement that such officer has made such examination or investigation as, in
such officers opinion, is necessary to enable such officer to express an informed opinion
as to whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such condition or
covenant has been complied with.
Operative Documents means the Placement Agreement, the Indenture, the Trust Agreement, the
Guarantee Agreement, the Subscription Agreement, the Notes and the Trust Securities.
Opinion of Counsel means a written opinion of counsel, who may be counsel for, or an
employee of, the Depositor or any Affiliate of the Depositor.
Original Issue Date means the date of original issuance of the Trust Securities.
7
Original Trust Agreement has the meaning specified in the recitals to this Trust Agreement.
Outstanding, when used with respect to any Trust Securities, means, as of the date of
determination, all Trust Securities theretofore executed and delivered under this Trust Agreement,
except:
(a) Trust Securities theretofore canceled by the Property Trustee or delivered to the
Property Trustee for cancellation;
(b) Trust Securities for which payment or redemption money in the necessary amount has
been theretofore deposited with the Property Trustee or any Paying Agent in trust for the
Holders of such Trust Securities; provided, that if such Trust Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this Trust Agreement;
and
(c) Trust Securities that have been paid or in exchange for or in lieu of which other
Trust Securities have been executed and delivered pursuant to the provisions of this Trust
Agreement, unless proof satisfactory to the Property Trustee is presented that any such
Trust Securities are held by Holders in whose hands such Trust Securities are valid, legal
and binding obligations of the Trust;
provided, that in determining whether the Holders of the requisite Liquidation Amount of the
Outstanding Preferred Securities have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Preferred Securities owned by the Depositor, any Trustee or any
Affiliate of the Depositor or of any Trustee shall be disregarded and deemed not to be Outstanding,
except that (i) in determining whether any Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only Preferred Securities
that such Trustee knows to be so owned shall be so disregarded and (ii) the foregoing shall not
apply at any time when all of the Outstanding Preferred Securities are owned by the Depositor, one
or more of the Trustees and/or any such Affiliate. Preferred Securities so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction
of the Administrative Trustees the pledgees right so to act with respect to such Preferred
Securities and that the pledgee is not the Depositor, any Trustee or any Affiliate of the Depositor
or of any Trustee.
Owner means each Person who is the beneficial owner of Book-Entry Preferred Securities as
reflected in the records of the Depositary or, if a Depositary Participant is not the beneficial
owner, then the beneficial owner as reflected in the records of the Depositary Participant.
Paying Agent means any Person authorized by the Administrative Trustees to pay Distributions
or other amounts in respect of any Trust Securities on behalf of the Trust.
Payment Account means a segregated non-interest-bearing corporate trust account maintained
by the Property Trustee for the benefit of the Holders in which all amounts paid in respect of the
Notes will be held and from which the Property Trustee, through the Paying Agent, shall make
payments to the Holders in accordance with
Sections 3.1
,
4.1
and
4.2
.
8
Person means a legal person, including any individual, corporation, estate, partnership,
joint venture, association, joint stock company, company, limited liability company, trust,
unincorporated association or government, or any agency or political subdivision thereof, or any
other entity of whatever nature.
Placement Agent means SunTrust Capital Markets, Inc., as Placement Agent pursuant to the
Placement Agreement, whose address is 303 Peachtree Street, 24th Floor, Mail Code 3950, Atlanta,
Georgia 30308.
Placement Agreement means the Placement Agreement, dated as of September 29, 2006, executed
and delivered by the Trust, the Depositor and SunTrust Capital Markets, Inc., as placement agent.
Preferred Security means an undivided beneficial interest in the assets of the Trust, having
a Liquidation Amount of $1,000 and having the rights provided therefor in this Trust Agreement.
Preferred Securities Certificate means a certificate evidencing ownership of Preferred
Securities, substantially in the form attached as
Exhibit C
.
Property Trustee means the Person identified as the Property Trustee in the preamble to
this Trust Agreement, solely in its capacity as Property Trustee of the Trust and not in its
individual capacity, or its successor in interest in such capacity, or any successor Property
Trustee appointed as herein provided.
Purchaser means SunTrust Equity Funding , LLC, as purchaser of the Preferred Securities
pursuant to the Subscription Agreement, whose address is 303 Peachtree Street NW, 26th Floor,
Atlanta, Georgia 30308.
QIB means a qualified institutional buyer as defined in Rule 144A under the Securities
Act.
Redemption Date means, with respect to any Trust Security to be redeemed, the date fixed for
such redemption by or pursuant to this Trust Agreement; provided, that each Note Redemption Date
and the stated maturity (or any date of principal repayment upon early maturity) of the Notes shall
be a Redemption Date for a Like Amount of Trust Securities.
Redemption Price means, with respect to any Trust Security, the Liquidation Amount of such
Trust Security, plus accumulated and unpaid Distributions to the Redemption Date, plus the related
amount of the premium, if any, paid by the Depositor upon the concurrent redemption or payment at
maturity of a Like Amount of Notes.
Reference Banks has the meaning specified in
Schedule A
.
Responsible Officer means, with respect to the Property Trustee, any Senior Vice President,
any Vice President, any Assistant Vice President, the Secretary, any Assistant Secretary, the
Treasurer, any Assistant Treasurer, any Financial Services Officer or Assistant Financial Services
Officer or any other officer of the Corporate Trust Department of the Property
9
Trustee and also means, with respect to a particular corporate trust matter, any other officer
to whom such matter is referred because of that officers knowledge of and familiarity with the
particular subject.
Securities Act means the Securities Act of 1933, and any successor statute thereto, in each
case as amended from time to time.
Securities Certificate means any one of the Common Securities Certificates or the Preferred
Securities Certificates.
Securities Register and Securities Registrar have the respective meanings specified in
Section 5.7
.
Special Event Redemption Price has the meaning specified in
Section 11.2
of the
Indenture.
Subscription Agreement means the Preferred Securities Subscription Agreement, dated as of
September 29, 2006, by and among the Depositor, the Trust, the Purchaser and SunTrust Capital
Markets, Inc. (as to certain provisions thereof).
Successor Securities has the meaning specified in
Section 9.5(a)
.
Tax Event has the meaning specified in
Section 1.1
of the Indenture.
Trust means the Delaware statutory trust known as Texas Capital Statutory Trust V, which
was created on September 27, 2006, under the Delaware Statutory Trust Act pursuant to the Original
Trust Agreement and the filing of the Certificate of Trust, and continued pursuant to this Trust
Agreement.
Trust Agreement means this Amended and Restated Trust Agreement, including all Schedules and
Exhibits, as the same may be modified, amended or supplemented from time to time in accordance with
the applicable provisions hereof.
Trustees means the Administrative Trustees, the Property Trustee and the Delaware Trustee,
each as defined in this
Article I
.
Trust Property means (a) the Notes, (b) any cash on deposit in, or owing to, the Payment
Account and (c) all proceeds and rights in respect of the foregoing and any other property and
assets for the time being held or deemed to be held by the Property Trustee pursuant to the trusts
of this Trust Agreement.
Trust Security means any one of the Common Securities or the Preferred Securities.
10
ARTICLE II.
The Trust
SECTION 2.1. Name.
The trust continued hereby shall be known as Texas Capital Statutory Trust V, as such name
may be modified from time to time by the Administrative Trustees following written notice to the
Holders of Trust Securities and the other Trustees, in which name the Trustees may conduct the
business of the Trust, make and execute contracts and other instruments on behalf of the Trust and
sue and be sued.
SECTION 2.2. Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is Rodney Square North, 1100
North Market Street, Wilmington, Delaware 19890-1600, Attention: Corporate Trust Administration,
or such other address in the State of Delaware as the Delaware Trustee may designate by written
notice to the Holders, the Depositor, the Property Trustee and the Administrative Trustees. The
principal executive office of the Trust is c/o Texas Capital Bancshares, Inc., 2100 McKinney
Avenue, Suite 900, Dallas, Texas 75201, Attention: Chief Financial Officer, as such address may be
changed from time to time by the Administrative Trustees following written notice to the Holders
and the other Trustees.
SECTION 2.3. Initial Contribution of Trust Property; Fees, Costs and Expenses.
The Property Trustee acknowledges receipt from the Depositor in connection with the Original
Trust Agreement of the sum of ten dollars ($10), which constituted the initial Trust Property. The
Depositor shall pay all fees, costs and expenses of the Trust (except with respect to the Trust
Securities) as they arise or shall, upon request of any Trustee, promptly reimburse such Trustee
for any such fees, costs and expenses paid by such Trustee. The Depositor shall make no claim upon
the Trust Property for the payment of such fees, costs or expenses.
SECTION 2.4. Purposes of Trust.
(a) The exclusive purposes and functions of the Trust are to (i) issue and sell Trust
Securities and use the proceeds from such sale to acquire the Notes and (ii) engage in only those
activities necessary or incidental thereto. The Delaware Trustee, the Property Trustee and the
Administrative Trustees are trustees of the Trust, and have all the rights, powers and duties to
the extent set forth herein. The Trustees hereby acknowledge that they are trustees of the Trust.
(b) So long as this Trust Agreement remains in effect, the Trust (or the Trustees acting on
behalf of the Trust) shall not undertake any business, activities or transaction except as
expressly provided herein or contemplated hereby. In particular, the Trust (or the Trustees acting
on behalf of the Trust) shall not (i) acquire any investments or engage in any activities not
authorized by this Trust Agreement, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests therein, including to
Holders, except as expressly provided herein, (iii) incur any indebtedness for borrowed money or
issue any other debt, (iv) take or consent to any action that would result in the placement of a
Lien on
11
any of the Trust Property, (v) take or consent to any action that would reasonably be expected
to cause the Trust to become taxable as a corporation or classified as other than a grantor trust
for United States federal income tax purposes, (vi) take or consent to any action that would cause
the Notes to be treated as other than indebtedness of the Depositor for United States federal
income tax purposes or (vii) take or consent to any action that would cause the Trust to be deemed
to be an investment company required to be registered under the Investment Company Act.
SECTION 2.5. Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in accordance with and subject to the
terms of this Trust Agreement. In accordance with the following provisions (i) and (ii), the
Trustees shall have the authority to enter into all transactions and agreements determined by the
Trustees to be appropriate in exercising the authority, express or implied, otherwise granted to
the Trustees, under this Trust Agreement, and to perform all acts in furtherance thereof, including
the following:
(i) As among the Trustees, each Administrative Trustee shall severally have the power
and authority to act on behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute, deliver and perform on
behalf of the Trust, such agreements as may be necessary or desirable in connection
with the purposes and function of the Trust, including, without limitation, a common
securities subscription agreement and a junior subordinated note subscription
agreement and to cause the Trust to perform in accordance with the Placement
Agreement and the Subscription Agreement;
(C) assisting in the sale of the Preferred Securities in one or more
transactions exempt from registration under the Securities Act, and in compliance
with applicable state securities or blue sky laws;
(D) assisting in the sending of notices (other than notices of default) and
other information regarding the Trust Securities and the Notes to the Holders in
accordance with this Trust Agreement;
(E) the appointment of a Paying Agent, Calculation Agent and Securities
Registrar in accordance with this Trust Agreement;
(F) execution of the Trust Securities on behalf of the Trust in accordance with
this Trust Agreement;
(G) execution and delivery of closing certificates, if any, pursuant to the
Placement Agreement and application for a taxpayer identification number for the
Trust;
12
(H) preparation and filing of all applicable tax returns and tax information
reports that are required to be filed on behalf of the Trust;
(I) the taking of all action that may be necessary for the preservation and
continuance of the Trusts valid existence, rights, franchises and privileges as a
statutory trust under the laws of the State of Delaware;
(J) establishing a record date with respect to all actions to be taken
hereunder that require a record date to be established, except as provided in
Section 6.10(a)
;
(K) unless otherwise required by the Delaware Statutory Trust Act to execute on
behalf of the Trust (either acting alone or together with the other Administrative
Trustees) any documents that such Administrative Trustee has the power to execute
pursuant to this Trust Agreement; and
(L) the taking of any action incidental to the foregoing as such Administrative
Trustee may from time to time determine is necessary or advisable to give effect to
the terms of this Trust Agreement.
(ii) As among the Trustees, the Property Trustee shall have the power, duty and
authority to act on behalf of the Trust with respect to the following matters:
(A) the receipt and holding of legal title of the Notes;
(B) the establishment of the Payment Account;
(C) the collection of interest, principal and any other payments made in
respect of the Notes and the holding of such amounts in the Payment Account;
(D) the distribution through the Paying Agent of amounts distributable to the
Holders in respect of the Trust Securities;
(E) the exercise of all of the rights, powers and privileges of a holder of the
Notes in accordance with the terms of this Trust Agreement;
(F) the sending of notices of default and other information regarding the Trust
Securities and the Notes to the Holders in accordance with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with the terms of this
Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding up of the
affairs of and liquidation of the Trust and the preparation, execution and filing of
the certificate of cancellation of the Trust with the Secretary of State of the
State of Delaware; and
13
(I) the taking of any action incidental to the foregoing as the Property
Trustee may from time to time determine is necessary or advisable to give effect to
the terms of this Trust Agreement and protect and conserve the Trust Property for
the benefit of the Holders (without consideration of the effect of any such action
on any particular Holder).
(b) In connection with the issue and sale of the Preferred Securities, the Depositor shall
have the right and responsibility to assist the Trust with respect to, or effect on behalf of the
Trust, the following (and any actions taken by the Depositor in furtherance of the following prior
to the date of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the negotiation of the terms of, and the execution and delivery of, the Placement
Agreement and the Subscription Agreement providing for the sale of the Preferred Securities
in one or more transactions exempt from registration under the Securities Act, and in
compliance with applicable state securities or blue sky laws; and
(ii) the taking of any other actions necessary or desirable to carry out any of the
foregoing activities.
(c) Notwithstanding anything herein to the contrary, the Administrative Trustees are
authorized and directed to conduct the affairs of the Trust and to operate the Trust so that the
Trust will not be taxable as a corporation or classified as other than a grantor trust for United
States federal income tax purposes, so that the Notes will be treated as indebtedness of the
Depositor for United States federal income tax purposes and so that the Trust will not be deemed to
be an investment company required to be registered under the Investment Company Act. In this
connection, each Administrative Trustee is authorized to take any action, not inconsistent with
applicable law, the Certificate of Trust or this Trust Agreement, that such Administrative Trustee
determines in his or her discretion to be necessary or desirable for such purposes, as long as such
action does not adversely affect in any material respect the interests of the Holders of the
Outstanding Preferred Securities. In no event shall the Administrative Trustees be liable to the
Trust or the Holders for any failure to comply with this
Section 2.5
to the extent that
such failure results solely from a change in law or regulation or in the interpretation thereof.
(d) Any action taken by a Trustee in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with any Trustee acting on behalf of the Trust, no Person
shall be required to inquire into the authority of such Trustee to bind the Trust. Persons dealing
with the Trust are entitled to rely conclusively on the power and authority of any Trustee as set
forth in this Trust Agreement.
SECTION 2.6. Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
SECTION 2.7. Title to Trust Property.
(a) Legal title to all Trust Property shall be vested at all times in the Property Trustee and
shall be held and administered by the Property Trustee in trust for the benefit of the Trust and
the Holders in accordance with this Trust Agreement.
14
(b) The Holders shall not have any right or title to the Trust Property other than the
undivided beneficial interest in the assets of the Trust conferred by their Trust Securities and
they shall have no right to call for any partition or division of property, profits or rights of
the Trust except as described below. The Trust Securities shall be personal property giving only
the rights specifically set forth therein and in this Trust Agreement.
ARTICLE III.
Payment Account; Paying Agents
SECTION 3.1. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall establish the Payment Account.
The Property Trustee and the Paying Agent shall have exclusive control and sole right of withdrawal
with respect to the Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All monies and other property deposited or
held from time to time in the Payment Account shall be held by the Property Trustee in the Payment
Account for the exclusive benefit of the Holders and for Distribution as herein provided.
(b) The Property Trustee shall deposit in the Payment Account, promptly upon receipt, all
payments of principal of or interest on, and any other payments with respect to, the Notes. Amounts
held in the Payment Account shall not be invested by the Property Trustee pending distribution
thereof.
SECTION 3.2. Appointment of Paying Agents.
The Paying Agent shall initially be the Property Trustee. The Paying Agent shall make
Distributions to Holders from the Payment Account and shall report the amounts of such
Distributions to the Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account solely for the purpose of making the
Distributions referred to above. The Administrative Trustees may revoke such power and remove the
Paying Agent in their sole discretion. Any Person acting as Paying Agent shall be permitted to
resign as Paying Agent upon thirty (30) days written notice to the Administrative Trustees and the
Property Trustee. If the Property Trustee shall no longer be the Paying Agent or a successor Paying
Agent shall resign or its authority to act be revoked, the Administrative Trustees shall appoint a
successor (which shall be a bank or trust company) to act as Paying Agent. Such successor Paying
Agent appointed by the Administrative Trustees shall execute and deliver to the Trustees an
instrument in which such successor Paying Agent shall agree with the Trustees that as Paying Agent,
such successor Paying Agent will hold all sums, if any, held by it for payment to the Holders in
trust for the benefit of the Holders entitled thereto until such sums shall be paid to such
Holders. The Paying Agent shall return all unclaimed funds to the Property Trustee and upon removal
of a Paying Agent such Paying Agent shall also return all funds in its possession to the Property
Trustee. The provisions of
Article VIII
shall apply to the Property Trustee also in its
role as Paying Agent, for so long as the Property Trustee shall act as Paying Agent and, to the
extent applicable, to any other Paying Agent appointed hereunder.
15
Any reference in this Trust Agreement to the Paying Agent shall include any co-paying agent
unless the context requires otherwise.
ARTICLE IV.
Distributions; Redemption
SECTION 4.1. Distributions.
(a) The Trust Securities represent undivided beneficial interests in the Trust Property, and
Distributions (including any Additional Interest Amounts) will be made on the Trust Securities at
the rate and on the dates that payments of interest (including any Additional Interest) are made on
the Notes. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative, and shall accumulate
whether or not there are funds of the Trust available for the payment of Distributions.
Distributions shall accumulate from September 29, 2006, and, except as provided in clause
(ii) below, shall be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year, commencing on December 31, 2006. If any date on which a
Distribution is otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for the period
from and after each such date until the next succeeding Business Day), except that, if such
Business Day falls in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case, with the same force and effect as if made
on such date (each date on which Distributions are payable in accordance with this Section
4.1(a)(i), a Distribution Date);
(ii) in the event (and to the extent) that the Depositor exercises its right under the
Indenture to defer the payment of interest on the Notes, Distributions on the Trust
Securities shall be deferred. Under the Indenture, so long as no Note Event of Default
pursuant to paragraphs (c), (e) or (f) of
Section 5.1
of the Indenture has occurred
and is continuing, the Depositor shall have the right, at any time and from time to time
during the term of the Notes, to defer the payment of interest on the Notes for a period of
up to twenty (20) consecutive quarterly interest payment periods (each such extended
interest payment period, an Extension Period). No interest on the Notes shall be due and
payable during an Extension Period (except any Additional Tax Sums that may be due and
payable), except at the end thereof, but each installment of interest that would otherwise
have been due and payable during such Extension Period shall bear Additional Interest (to
the extent payment of such interest would be legally enforceable) at a variable rate per
annum, reset quarterly, equal to LIBOR plus 1.71% thereafter, compounded quarterly, from the
dates on which such amounts would have otherwise been due and payable until paid or until
funds for the payment thereof have been made available for payment. If Distributions are
deferred, the deferred Distributions (including Additional Interest Amounts) shall be paid
on the date that the related Extension Period terminates,
16
to Holders of the Trust Securities as they appear on the books and records of the Trust
on the record date immediately preceding such termination date.
(iii) Distributions shall accumulate and be payable in respect of the Trust Securities
at an annual rate equal to 7.076880% beginning on (and including) the date of original
issuance and ending on (but excluding) December 31, 2006 and at an annual rate for each
successive period beginning on (and including) December 31, 2006, and each successive
Distribution Date, and ending on (but excluding) the next succeeding Distribution Date, at a
variable rate per annum, reset quarterly, equal to LIBOR plus 1.71% of the Liquidation
Amount of the Trust Securities, such rate being the rate of interest payable on the Notes.
LIBOR shall be determined by the Calculation Agent in accordance with
Schedule A
.
The amount of Distributions payable for any period less than a full Distribution period
shall be computed on the basis of a 360-day year and the actual number of days elapsed in
the relevant Distribution period. The amount of Distributions payable for any period shall
include any Additional Interest Amounts in respect of such period; and
(iv) Distributions on the Trust Securities shall be made by the Paying Agent from the
Payment Account and shall be payable on each Distribution Date only to the extent that the
Trust has funds then on hand and available in the Payment Account for the payment of such
Distributions.
(b) Distributions on the Trust Securities with respect to a Distribution Date shall be payable
to the Holders thereof as they appear on the Securities Register for the Trust Securities at the
close of business on the relevant record date, which shall be at the close of business on the
fifteenth day (whether or not a Business Day) preceding the relevant Distribution Date.
Distributions payable on any Trust Securities that are not punctually paid on any Distribution Date
as a result of the Depositor having failed to make an interest payment under the Notes will cease
to be payable to the Person in whose name such Trust Securities are registered on the relevant
record date, and such defaulted Distributions and any Additional Interest Amounts will instead be
payable to the Person in whose name such Trust Securities are registered on the special record
date, or other specified date for determining Holders entitled to such defaulted Distribution and
Additional Interest Amount, established in the same manner, and on the same date, as such is
established with respect to the Notes under the Indenture.
SECTION 4.2. Redemption.
(a) On each Note Redemption Date and on the stated maturity (or any date of principal
repayment upon early maturity) of the Notes and on each other date on (or in respect of) which any
principal on the Notes is repaid, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-class mail, postage
prepaid, mailed not less than thirty (30) nor more than sixty (60) days prior to the Redemption
Date to each Holder of Trust Securities to be redeemed (unless a shorter notice shall be reasonably
satisfactory to the Trustee), at such Holders address appearing in the Securities Register. All
notices of redemption shall state:
17
(i) the Redemption Date;
(ii) the Redemption Price or, if the Redemption Price cannot be calculated prior to the
time the notice is required to be sent, the estimate of the Redemption Price provided
pursuant to the Indenture, as calculated by the Depositor, together with a statement that it
is an estimate and that the actual Redemption Price will be calculated by the Calculation
Agent on the fifth Business Day prior to the Redemption Date (and if an estimate is
provided, a further notice shall be sent of the actual Redemption Price on the date that
such Redemption Price is calculated);
(iii) if less than all the Outstanding Trust Securities are to be redeemed, the
identification (and, in the case of partial redemption, the respective liquidation amounts)
and Liquidation Amounts of the particular Trust Securities to be redeemed;
(iv) that on the Redemption Date, the Redemption Price will become due and payable upon
each such Trust Security, or portion thereof, to be redeemed and that Distributions thereon
will cease to accumulate on such Trust Security or such portion, as the case may be, on and
after said date, except as provided in
Section 4.2(d)
;
(v) the place or places where the Trust Securities are to be surrendered for the
payment of the Redemption Price; and
(vi) such other provisions as the Property Trustee deems relevant.
(c) The Trust Securities (or portion thereof) redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous redemption or payment
at maturity of Notes. Redemptions of the Trust Securities (or portion thereof) shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent that the Trust has
funds then on hand and available in the Payment Account for the payment of such Redemption Price.
Under the Indenture, the Notes may be redeemed by the Depositor on any Interest Payment Date, at
the Depositors option, on or after December 31, 2011, in whole or in part, from time to time at a
redemption price equal to one hundred percent (100%) of the principal amount thereof, together, in
the case of any such redemption, with accrued interest, including any Additional Interest, to but
excluding the date fixed for redemption (the Indenture Redemption Price); provided, that the
Depositor shall have received the prior approval of the Federal Reserve if then required. The
Notes may also be redeemed by the Depositor, at its option, in whole but not in part, upon the
occurrence of a Capital Disqualification Event, an Investment Company Event or a Tax Event at the
Special Event Redemption Price (as set forth in the Indenture).
(d) If the Property Trustee gives a notice of redemption in respect of any Preferred
Securities, then by 10:00 A.M., New York City time, on the Redemption Date, the Depositor shall
deposit sufficient funds with the Property Trustee to pay the Redemption Price. If such deposit
has been made by such time, then by 12:00 noon, New York City time, on the Redemption Date, the
Property Trustee will, with respect to Book-Entry Preferred Securities, irrevocably deposit with
the Depositary for such Book-Entry Preferred Securities, to the extent available therefor, funds
sufficient to pay the applicable Redemption Price and will give such
18
Depositary irrevocable instructions and authority to pay the Redemption Price to the Holders
of the Preferred Securities. With respect to Preferred Securities that are not Book-Entry Preferred
Securities, the Property Trustee will irrevocably deposit with the Paying Agent, to the extent
available therefor, funds sufficient to pay the applicable Redemption Price and will give the
Paying Agent irrevocable instructions and authority to pay the Redemption Price to the Holders of
the Preferred Securities upon surrender of their Preferred Securities Certificates. Notwithstanding
the foregoing, Distributions payable on or prior to the Redemption Date for any Trust Securities
(or portion thereof) called for redemption shall be payable to the Holders of such Trust Securities
as they appear on the Securities Register on the relevant record dates for the related Distribution
Dates. If notice of redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of Holders holding Trust Securities (or portion thereof) so called
for redemption will cease, except the right of such Holders to receive the Redemption Price and any
Distribution payable in respect of the Trust Securities on or prior to the Redemption Date, but
without interest, and, in the case of a partial redemption, the right of such Holders to receive a
new Trust Security or Securities of authorized denominations, in aggregate Liquidation Amount equal
to the unredeemed portion of such Trust Security or Securities, and such Securities (or portion
thereof) called for redemption will cease to be Outstanding. In the event that any date on which
any Redemption Price is payable is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding Business Day (and no interest shall accrue in
respect of the amounts whose payment is so delayed for the period from and after each such date
until the next succeeding Business Day) with the same force and effect as if made on such date. In
the event that payment of the Redemption Price in respect of any Trust Securities (or portion
thereof) called for redemption is improperly withheld or refused and not paid either by the Trust
or by the Depositor pursuant to the Guarantee Agreement, Distributions on such Trust Securities (or
portion thereof) will continue to accumulate, as set forth in
Section 4.1
, from the
Redemption Date originally established by the Trust for such Trust Securities(or portion thereof)
to the date such Redemption Price is actually paid, in which case the actual payment date will be
the date fixed for redemption for purposes of calculating the Redemption Price.
(e) Subject to
Section 4.3
(a), if less than all the Outstanding Trust Securities are
to be redeemed on a Redemption Date, then the aggregate Liquidation Amount of Trust Securities to
be redeemed shall be allocated pro rata to the Common Securities and the Preferred Securities based
upon the relative aggregate Liquidation Amounts of the Common Securities and the Preferred
Securities. The Preferred Securities to be redeemed shall be redeemed on a pro rata basis based
upon their respective Liquidation Amounts not more than sixty (60) days prior to the Redemption
Date by the Property Trustee from the Outstanding Preferred Securities not previously called for
redemption; provided, however, that with respect to Holders that would be required to hold less
than one hundred (100) but more than zero (0) Trust Securities as a result of such redemption, the
Trust shall redeem Trust Securities of each such Holder so that after such redemption such Holder
shall hold either one hundred (100) Trust Securities or such Holder no longer holds any Trust
Securities, and shall use such method (including, without limitation, by lot) as the Trust shall
deem fair and appropriate; and provided, further, that so long as the Preferred Securities are
Book-Entry Preferred Securities, such selection shall be made in accordance with the Applicable
Depositary Procedures for the Preferred Securities by such Depositary. The Property Trustee shall
promptly notify the Securities Registrar in writing of the Preferred Securities (or portion
thereof) selected for redemption and, in the case of any Preferred
19
Securities selected for partial redemption, the Liquidation Amount thereof to be redeemed. For
all purposes of this Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Preferred Securities shall relate, in the case of any Preferred
Securities redeemed or to be redeemed only in part, to the portion of the aggregate Liquidation
Amount of Preferred Securities that has been or is to be redeemed.
(f) The Trust in issuing the Trust Securities may use CUSIP numbers (if then generally in
use), and, if so, the Property Trustee shall indicate the CUSIP numbers of the Trust Securities
in notices of redemption and related materials as a convenience to Holders; provided, that any such
notice may state that no representation is made as to the correctness of such numbers either as
printed on the Trust Securities or as contained in any notice of redemption and related materials.
SECTION 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including any Additional Interest Amounts) on, the Redemption
Price of and the Liquidation Distribution in respect of, the Trust Securities, as applicable, shall
be made, pro rata among the Common Securities and the Preferred Securities based on the Liquidation
Amount of the respective Trust Securities; provided, that if on any Distribution Date, Redemption
Date or Liquidation Date an Event of Default shall have occurred and be continuing, no payment of
any Distribution (including any Additional Interest Amounts) on, Redemption Price of or Liquidation
Distribution in respect of, any Common Security, and no other payment on account of the redemption,
liquidation or other acquisition of Common Securities, shall be made unless payment in full in cash
of all accumulated and unpaid Distributions (including any Additional Interest Amounts) on all
Outstanding Preferred Securities for all Distribution periods terminating on or prior thereto, or
in the case of payment of the Redemption Price the full amount of such Redemption Price on all
Outstanding Preferred Securities then called for redemption, or in the case of payment of the
Liquidation Distribution the full amount of such Liquidation Distribution on all Outstanding
Preferred Securities, shall have been made or provided for, and all funds immediately available to
the Property Trustee shall first be applied to the payment in full in cash of all Distributions
(including any Additional Interest Amounts) on, or the Redemption Price of or the Liquidation
Distribution in respect of, the Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default, the Holders of the Common
Securities shall have no right to act with respect to any such Event of Default under this Trust
Agreement until all such Events of Default with respect to the Preferred Securities have been
cured, waived or otherwise eliminated. Until all such Events of Default under this Trust Agreement
with respect to the Preferred Securities have been so cured, waived or otherwise eliminated, the
Property Trustee shall act solely on behalf of the Holders of the Preferred Securities and not on
behalf of the Holders of the Common Securities, and only the Holders of a Majority in Liquidation
Amount of the Preferred Securities will have the right to direct the Property Trustee to act on
their behalf.
20
SECTION 4.4. Payment Procedures.
Payments of Distributions (including any Additional Interest Amounts), the Redemption Price,
Liquidation Amount or any other amounts in respect of the Preferred Securities shall be made by
wire transfer at such place and to such account at a banking institution in the United States as
may be designated in writing at least ten (10) Business Days prior to the date for payment by the
Person entitled thereto unless proper written transfer instructions have not been received by the
relevant record date, in which case such payments shall be made by check mailed to the address of
such Person as such address shall appear in the Securities Register. If any Preferred Securities
are held by a Depositary, such Distributions thereon shall be made to the Depositary in immediately
available funds. Payments in respect of the Common Securities shall be made in such manner as shall
be mutually agreed between the Property Trustee and the Holder of all the Common Securities.
SECTION 4.5. Withholding Tax.
The Trust and the Administrative Trustees shall comply with all withholding and backup
withholding tax requirements under United States federal, state and local law. The Administrative
Trustees on behalf of the Trust shall request, and the Holders shall provide to the Trust, such
forms or certificates as are necessary to establish an exemption from withholding and backup
withholding tax with respect to each Holder and any representations and forms as shall reasonably
be requested by the Administrative Trustees on behalf of the Trust to assist it in determining the
extent of, and in fulfilling, its withholding and backup withholding tax obligations. The
Administrative Trustees shall file required forms with applicable jurisdictions and, unless an
exemption from withholding and backup withholding tax is properly established by a Holder, shall
remit amounts withheld with respect to the Holder to applicable jurisdictions. To the extent that
the Trust is required to withhold and pay over any amounts to any jurisdiction with respect to
Distributions or allocations to any Holder, the amount withheld shall be deemed to be a
Distribution in the amount of the withholding to the Holder. In the event of any claimed
overwithholding, Holders shall be limited to an action against the applicable jurisdiction. If the
amount required to be withheld was not withheld from actual Distributions made, the Administrative
Trustees on behalf of the Trust may reduce subsequent Distributions by the amount of such required
withholding.
SECTION 4.6. Tax Returns and Other Reports.
(a) The Administrative Trustees shall prepare (or cause to be prepared) at the principal
office of the Trust in the United States, as defined for purposes of Treasury regulations section
301.7701-7, at the Depositors expense, and file, all United States federal, state and local tax
and information returns and reports required to be filed by or in respect of the Trust. The
Administrative Trustees shall prepare at the principal office of the Trust in the United States, as
defined for purposes of Treasury regulations section 301.7701-7, and furnish (or cause to be
prepared and furnished), by January 31 in each taxable year of the Trust to each Holder all
Internal Revenue Service forms and returns required to be provided by the Trust. The Administrative
Trustees shall provide the Depositor and the Property Trustee with a copy of all such returns and
reports promptly after such filing or furnishing.
21
(b) So long as the Property Trustee is the holder of the Notes, the Administrative Trustees
will cause the Depositors reports on Form FR Y-9C to be delivered to the Property Trustee promptly
following their filing with the Federal Reserve.
SECTION 4.7. Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Notes of Additional Tax Sums and upon the written direction of the
Administrative Trustees, the Property Trustee shall promptly pay, solely out of monies on deposit
pursuant to this Trust Agreement, any Additional Taxes imposed on the Trust by the United States or
any other taxing authority.
SECTION 4.8. Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred Securities shall be reduced by the
amount of any corresponding payment such Holder (or any Owner with respect thereto) has directly
received pursuant to
Section 5.8
of the Indenture or
Section 6.10(b)
of this Trust
Agreement.
SECTION 4.9. Exchanges.
(a) If at any time the Depositor or any of its Affiliates (in either case, a Depositor
Affiliate) is the Owner or Holder of any Preferred Securities, such Depositor Affiliate shall have
the right to deliver to the Property Trustee all or such portion of its Preferred Securities as it
elects and receive, in exchange therefor, a Like Amount of Notes. Such election (i) shall be
exercisable effective on any Distribution Date by such Depositor Affiliate delivering to the
Property Trustee a written notice of such election specifying the Liquidation Amount of Preferred
Securities with respect to which such election is being made and the Distribution Date on which
such exchange shall occur, which Distribution Date shall be not less than ten (10) Business Days
after the date of receipt by the Property Trustee of such election notice and (ii) shall be
conditioned upon such Depositor Affiliate having delivered or caused to be delivered to the
Property Trustee or its designee the Preferred Securities that are the subject of such election by
10:00 A.M. New York time, on the Distribution Date on which such exchange is to occur. After the
exchange, such Preferred Securities will be canceled and will no longer be deemed to be Outstanding
and all rights of the Depositor Affiliate with respect to such Preferred Securities will cease.
(b) In the case of an exchange described in
Section 4.9(a)
, the Property Trustee on
behalf of the Trust will, on the date of such exchange, exchange Notes having a principal amount
equal to a proportional amount of the aggregate Liquidation Amount of the Outstanding Common
Securities, based on the ratio of the aggregate Liquidation Amount of the Preferred Securities
exchanged pursuant to
Section 4.9(a)
divided by the aggregate Liquidation Amount of the
Preferred Securities Outstanding immediately prior to such exchange, for such proportional amount
of Common Securities held by the Depositor (which contemporaneously shall be canceled and no longer
be deemed to be Outstanding); provided, that the Depositor delivers or causes to be delivered to
the Property Trustee or its designee the required amount of Common Securities to be exchanged by
10:00 A.M. New York time, on the Distribution Date on which such exchange is to occur.
22
SECTION 4.10. Calculation Agent.
(a) The Property Trustee shall initially, and for so long as it holds any of the Notes, be the
Calculation Agent for purposes of determining LIBOR for each Distribution Date. The Calculation
Agent may be removed by the Administrative Trustees at any time. If the Calculation Agent is
unable or unwilling to act as such or is removed by the Administrative Trustees, the Administrative
Trustees will promptly appoint as a replacement Calculation Agent the London office of a leading
bank which is engaged in transactions in three-month Eurodollar deposits in the international
Eurodollar market and which does not control or is not controlled by or under common control with
the Administrative Trustees or their Affiliates. The Calculation Agent may not resign its duties
without a successor having been duly appointed.
(b) The Calculation Agent shall be required to agree that, as soon as possible after 11:00
a.m. (London time) on each LIBOR Determination Date, but in no event later than 11:00 a.m. (London
time) on the Business Day immediately following each LIBOR Determination Date, the Calculation
Agent will calculate the distribution rate (rounded to the nearest cent, with half a cent being
rounded upwards) for the related Distribution Date, and will communicate such rate and amount to
the Depositor, Trustee, each Paying Agent and the Depositary. The Calculation Agent will also
specify to the Administrative Trustees the quotations upon which the foregoing rates and amounts
are based and, in any event, the Calculation Agent shall notify the Administrative Trustees before
5:00 p.m. (London time) on each LIBOR Determination Date that either: (i) it has determined or is
in the process of determining the foregoing rates and amounts or (ii) it has not determined and is
not in the process of determining the foregoing rates and amounts, together with its reasons
therefor. The Calculation Agents determination of the foregoing rates and amounts for any
Distribution Date will (in the absence of manifest error) be final and binding upon all parties.
For the sole purpose of calculating the distribution rate for the Trust Securities, Business Day
shall be defined as any day on which dealings in deposits in Dollars are transacted in the London
interbank market.
SECTION 4.11. Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Administrative Trustees shall keep, or
cause to be kept at the principal office of the Trust in the United States, as defined for purposes
of Treasury Regulations section 301.7701-7, full books of account, records and supporting
documents, which shall reflect in reasonable detail each transaction of the Trust. The books of
account shall be maintained on the accrual method of accounting, in accordance with generally
accepted accounting principles, consistently applied.
(b) The Administrative Trustees shall either (i), if the Depositor is then subject to such
reporting requirements, cause each Form 10-K and Form 10-Q prepared by the Depositor and filed with
the Commission in accordance with the Exchange Act to be delivered to each Holder, with a copy to
the Property Trustee, within thirty (30) days after the filing thereof or (ii) cause to be prepared
at the principal office of the Trust in the United States, as defined for purposes of Treasury
Regulations section 301.7701-7, and delivered to each of the Holders, with a copy to the Property
Trustee, within ninety (90) days after the end of each Fiscal Year, annual financial statements of
the Trust, including a balance sheet of the Trust as of the end of such Fiscal Year, and the
related statements of income or loss.
23
(c) The Trust shall maintain one or more bank accounts in the United States, as defined for
purposes of Treasury Regulations section 301.7701-7, in the name and for the sole benefit of the
Trust;
provided
,
however
, that all payments of funds in respect of the Notes held
by the Property Trustee shall be made directly to the Payment Account and no other funds of the
Trust shall be deposited in the Payment Account. The sole signatories for such accounts (including
the Payment Account) shall be designated by the Property Trustee.
ARTICLE V.
Securities
SECTION 5.1. Initial Ownership.
Upon the creation of the Trust and the contribution by the Depositor referred to in
Section 2.3
and until the issuance of the Trust Securities, and at any time during which no
Trust Securities are Outstanding, the Depositor shall be the sole beneficial owner of the Trust.
SECTION 5.2. Authorized Trust Securities.
The Trust shall be authorized to issue one series of Preferred Securities having an aggregate
Liquidation Amount of $40,000,000 and one series of Common Securities having an aggregate
Liquidation Amount of $1,238,000.
SECTION 5.3. Issuance of the Common Securities; Subscription and Purchase of Notes.
On the Closing Date, an Administrative Trustee, on behalf of the Trust, shall execute and
deliver to the Depositor Common Securities Certificates, registered in the name of the Depositor,
evidencing an aggregate of 1,238 Common Securities having an aggregate Liquidation Amount of
$1,238,000, against receipt by the Trust of the aggregate purchase price of such Common Securities
of $1,238,000. Contemporaneously therewith and with the sale by the Trust to the Holders of an
aggregate of 40,000 Preferred Securities having an aggregate Liquidation Amount of $40,000,000, an
Administrative Trustee, on behalf of the Trust, shall subscribe for and purchase from the Depositor
Notes, to be registered in the name of the Property Trustee on behalf of the Trust and having an
aggregate principal amount equal to $41,238,000, and, in satisfaction of the purchase price for
such Notes, the Property Trustee, on behalf of the Trust, shall deliver to the Depositor the sum of
$41,238,000 (being the aggregate amount paid by the Holders for the Preferred Securities and the
amount paid by the Depositor for the Common Securities).
SECTION 5.4. The Securities Certificates.
(a) The Preferred Securities Certificates shall be issued in minimum denominations of $100,000
Liquidation Amount and integral multiples of $1,000 in excess thereof, and the Common Securities
Certificates shall be issued in minimum denominations of $10,000 Liquidation Amount and integral
multiples of $1,000 in excess thereof. The Securities Certificates shall be executed on behalf of
the Trust by manual or facsimile signature of at least one Administrative Trustee. Securities
Certificates bearing the signatures of individuals who
24
were, at the time when such signatures shall have been affixed, authorized to sign such
Securities Certificates on behalf of the Trust shall be validly issued and entitled to the benefits
of this Trust Agreement, notwithstanding that such individuals or any of them shall have ceased to
be so authorized prior to the delivery of such Securities Certificates or did not have such
authority at the date of delivery of such Securities Certificates.
(b) On the Closing Date, upon the written order of an authorized officer of the Depositor, the
Administrative Trustees shall cause Securities Certificates to be executed on behalf of the Trust
and delivered, without further corporate action by the Depositor, in authorized denominations.
(c) The Preferred Securities issued to QIBs shall be, except as provided in
Section
5.6
, Book-Entry Preferred Securities issued in the form of one or more Global Preferred
Securities registered in the name of the Depositary, or its nominee and deposited with the
Depositary or a custodian for the Depositary for credit by the Depositary to the respective
accounts of the Depositary Participants thereof (or such other accounts as they may direct). The
Preferred Securities issued to a Person other than a QIB shall be issued in the form of Definitive
Preferred Securities Certificate.
(d) A Preferred Security shall not be valid until authenticated by the manual signature of an
Authorized Officer of the Property Trustee. Such signature shall be conclusive evidence that the
Preferred Security has been authenticated under this Trust Agreement. Upon written order of the
Trust signed by one Administrative Trustee, the Property Trustee shall authenticate the Preferred
Securities for original issue. The Property Trustee may appoint an authenticating agent that is a
U.S. Person acceptable to the Trust to authenticate the Preferred Securities. A Common Security
need not be so authenticated and shall be valid upon execution by one or more Administrative
Trustees. The form of this certificate of authentication can be found in
Section 5.13
.
SECTION 5.5. Rights of Holders.
The Trust Securities shall have no preemptive or similar rights and when issued and delivered
to Holders against payment of the purchase price therefor will be fully paid and non-assessable by
the Trust. Except as provided in
Section 5.11(b)
, the Holders of the Trust Securities, in
their capacities as such, shall be entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized under the General Corporation Law of
the State of Delaware.
SECTION 5.6. Book-Entry Preferred Securities.
(a) A Global Preferred Security may be exchanged, in whole or in part, for Definitive
Preferred Securities Certificates registered in the names of the Owners only if such exchange
complies with
Section 5.7
and (i) the Depositary advises the Administrative Trustees and
the Property Trustee in writing that the Depositary is no longer willing or able properly to
discharge its responsibilities with respect to the Global Preferred Security, and no qualified
successor is appointed by the Administrative Trustees within ninety (90) days of receipt of such
notice, (ii) the Depositary ceases to be a clearing agency registered under the Exchange Act and
the
25
Administrative Trustees fail to appoint a qualified successor within ninety (90) days of
obtaining knowledge of such event, (iii) the Administrative Trustees at their option advise the
Property Trustee in writing that the Trust elects to terminate the book-entry system through the
Depositary or (iv) a Note Event of Default has occurred and is continuing. Upon the occurrence of
any event specified in clause (i), (ii), (iii) or (iv) above, the Administrative Trustees shall
notify the Depositary and instruct the Depositary to notify all Owners of Book-Entry Preferred
Securities, the Delaware Trustee and the Property Trustee of the occurrence of such event and of
the availability of the Definitive Preferred Securities Certificates to Owners of the Preferred
Securities requesting the same. Upon the issuance of Definitive Preferred Securities Certificates,
the Trustees shall recognize the Holders of the Definitive Preferred Securities Certificates as
Holders. Notwithstanding the foregoing, if an Owner of a beneficial interest in a Global Preferred
Security wishes at any time to transfer an interest in such Global Preferred Security to a Person
other than a QIB, such transfer shall be effected, subject to the Applicable Depositary Procedures,
in accordance with the provisions of this
Section 5.6
and
Section 5.7
, and the
transferee shall receive a Definitive Preferred Securities Certificate in connection with such
transfer. A holder of a Definitive Preferred Securities Certificate that is a QIB may, upon
request, and in accordance with the provisions of this
Section 5.6
and
Section 5.7
,
exchange such Definitive Preferred Securities Certificate for a beneficial interest in a Global
Preferred Security.
(b) If any Global Preferred Security is to be exchanged for Definitive Preferred Securities
Certificates or canceled in part, or if any Definitive Preferred Securities Certificate is to be
exchanged in whole or in part for any Global Preferred Security, then either (i) such Global
Preferred Security shall be so surrendered for exchange or cancellation as provided in this
Article V
or (ii) the aggregate Liquidation Amount represented by such Global Preferred
Security shall be reduced, subject to
Section 5.4
, or increased by an amount equal to the
Liquidation Amount represented by that portion of the Global Preferred Security to be so exchanged
or canceled, or equal to the Liquidation Amount represented by such Definitive Preferred Securities
Certificates to be so exchanged for any Global Preferred Security, as the case may be, by means of
an appropriate adjustment made on the records of the Securities Registrar, whereupon the Property
Trustee, in accordance with the Applicable Depositary Procedures, shall instruct the Depositary or
its authorized representative to make a corresponding adjustment to its records. Upon any such
surrender to the Administrative Trustees or the Securities Registrar of any Global Preferred
Security or Securities by the Depositary, accompanied by registration instructions, the
Administrative Trustees, or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Depositary. None of the Securities
Registrar or the Trustees shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be fully protected in relying on, such instructions.
(c) Every Securities Certificate executed and delivered upon registration or transfer of, or
in exchange for or in lieu of, a Global Preferred Security or any portion thereof shall be executed
and delivered in the form of, and shall be, a Global Preferred Security, unless such Securities
Certificate is registered in the name of a Person other than the Depositary for such Global
Preferred Security or a nominee thereof.
(d) The Depositary or its nominee, as registered owner of a Global Preferred Security, shall
be the Holder of such Global Preferred Security for all purposes under this Trust
26
Agreement and the Global Preferred Security, and Owners with respect to a Global Preferred
Security shall hold such interests pursuant to the Applicable Depositary Procedures. The Securities
Registrar and the Trustees shall be entitled to deal with the Depositary for all purposes of this
Trust Agreement relating to the Global Preferred Securities (including the payment of the
Liquidation Amount of and Distributions on the Book-Entry Preferred Securities represented thereby
and the giving of instructions or directions by Owners of Book-Entry Preferred Securities
represented thereby and the giving of notices) as the sole Holder of the Book-Entry Preferred
Securities represented thereby and shall have no obligations to the Owners thereof. None of the
Trustees nor the Securities Registrar shall have any liability in respect of any transfers effected
by the Depositary.
(e) The rights of the Owners of the Book-Entry Preferred Securities shall be exercised only
through the Depositary and shall be limited to those established by law, the Applicable Depositary
Procedures and agreements between such Owners and the Depositary and/or the Depositary
Participants; provided, solely for the purpose of determining whether the Holders of the requisite
amount of Preferred Securities have voted on any matter provided for in this Trust Agreement, to
the extent that Preferred Securities are represented by a Global Preferred Security, the Trustees
may conclusively rely on, and shall be fully protected in relying on, any written instrument
(including a proxy) delivered to the Property Trustee by the Depositary setting forth the Owners
votes or assigning the right to vote on any matter to any other Persons either in whole or in part.
To the extent that Preferred Securities are represented by a Global Preferred Security, the
initial Depositary will make book-entry transfers among the Depositary Participants and receive and
transmit payments on the Preferred Securities that are represented by a Global Preferred Security
to such Depositary Participants, and none of the Depositor or the Trustees shall have any
responsibility or obligation with respect thereto.
(f) To the extent that a notice or other communication to the Holders is required under this
Trust Agreement, for so long as Preferred Securities are represented by a Global Preferred
Security, the Trustees shall give all such notices and communications to the Depositary, and shall
have no obligations to the Owners.
SECTION 5.7. Registration of Transfer and Exchange of Preferred Securities Certificates.
(a) The Property Trustee shall keep or cause to be kept, at the Corporate Trust Office, a
register or registers (the Securities Register) in which the registrar and transfer agent with
respect to the Trust Securities (the Securities Registrar), subject to such reasonable
regulations as it may prescribe, shall provide for the registration of Preferred Securities
Certificates and Common Securities Certificates and registration of transfers and exchanges of
Preferred Securities Certificates as herein provided. The Person acting as the Property Trustee
shall at all times also be the Securities Registrar. The provisions of
Article VIII
shall
apply to the Property Trustee in its role as Securities Registrar.
(b) Upon surrender for registration of transfer of any Preferred Securities Certificate at the
office or agency maintained pursuant to
Section 5.7(f)
, the Administrative Trustees or any
one of them shall execute by manual or facsimile signature and deliver to the Property Trustee, and
the Property Trustee shall authenticate and deliver, in the name of the designated transferee
27
or transferees, one or more new Preferred Securities Certificates in authorized denominations
of a like aggregate Liquidation Amount as may be required by this Trust Agreement dated the date of
execution by such Administrative Trustee or Trustees. At the option of a Holder, Preferred
Securities Certificates may be exchanged for other Preferred Securities Certificates in authorized
denominations and of a like aggregate Liquidation Amount upon surrender of the Preferred Securities
Certificate to be exchanged at the office or agency maintained pursuant to
Section 5.7(f)
.
Whenever any Preferred Securities Certificates are so surrendered for exchange, the Administrative
Trustees or any one of them shall execute by manual or facsimile signature and deliver to the
Property Trustee, and the Property Trustee shall authenticate and deliver, the Preferred Securities
Certificates that the Holder making the exchange is entitled to receive.
(c) The Securities Registrar shall not be required, (i) to issue, register the transfer of or
exchange any Preferred Security during a period beginning at the opening of business fifteen (15)
days before the day of selection for redemption of such Preferred Securities pursuant to
Article IV
and ending at the close of business on the day of mailing of the notice of
redemption or (ii) to register the transfer of or exchange any Preferred Security so selected for
redemption in whole or in part, except, in the case of any such Preferred Security to be redeemed
in part, any portion thereof not to be redeemed.
(d) Every Preferred Securities Certificate presented or surrendered for registration of
transfer or exchange shall be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Securities Registrar duly executed by the Holder or such Holders
attorney duly authorized in writing and (i) if such Preferred Securities Certificate is being
transferred otherwise than to a QIB, accompanied by a certificate of the transferee substantially
in the form set forth as
Exhibit E
hereto or (ii) if such Preferred Securities Certificate
is being transferred to a QIB, accompanied by a certificate of the transferor substantially in the
form set forth as
Exhibit F
hereto.
(e) No service charge shall be made for any registration of transfer or exchange of Preferred
Securities Certificates, but the Property Trustee on behalf of the Trust may require payment of a
sum sufficient to cover any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Preferred Securities Certificates.
(f) The Administrative Trustees shall designate an office or offices or agency or agencies
where Preferred Securities Certificates may be surrendered for registration of transfer or
exchange, and initially designate the Corporate Trust Office as its office and agency for such
purposes. The Administrative Trustees shall give prompt written notice to the Depositor, the
Property Trustee and to the Holders of any change in the location of any such office or agency.
SECTION 5.8. Mutilated, Destroyed, Lost or Stolen Securities Certificates.
(a) If any mutilated Securities Certificate shall be surrendered to the Securities Registrar
together with such security or indemnity as may be required by the Securities Registrar and the
Administrative Trustees to save each of them harmless, the Administrative Trustees, or any one of
them, on behalf of the Trust, shall execute and make available for delivery in exchange therefor a
new Securities Certificate of like class, tenor and denomination.
28
(b) If the Securities Registrar shall receive evidence to its satisfaction of the destruction,
loss or theft of any Securities Certificate and there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be required by them to
save each of them harmless, then in the absence of notice that such Securities Certificate shall
have been acquired by a protected purchaser, the Administrative Trustees, or any one of them, on
behalf of the Trust, shall execute and make available for delivery, and, with respect to Preferred
Securities, the Property Trustee shall authenticate, in exchange for or in lieu of any such
destroyed, lost or stolen Securities Certificate, a new Securities Certificate of like class, tenor
and denomination.
(c) In connection with the issuance of any new Securities Certificate under this
Section
5.8
, the Administrative Trustees or the Securities Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection
therewith.
(d) Any duplicate Securities Certificate issued pursuant to this
Section 5.8
shall
constitute conclusive evidence of an undivided beneficial interest in the assets of the Trust
corresponding to that evidenced by the mutilated, lost, stolen or destroyed Securities Certificate,
as if originally issued, whether or not the lost, stolen or destroyed Securities Certificate shall
be found at any time.
(e) If any such mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Depositor in its discretion may, instead of issuing a new Security, pay such
Security.
(f) The provisions of this
Section 5.8
are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement of mutilated, destroyed, lost
or stolen Securities Certificates.
SECTION 5.9. Persons Deemed Holders.
The Trustees and the Securities Registrar shall each treat the Person in whose name any
Securities Certificate shall be registered in the Securities Register as the owner of such
Securities Certificate for the purpose of receiving Distributions and for all other purposes
whatsoever, and none of the Trustees and the Securities Registrar shall be bound by any notice to
the contrary.
SECTION 5.10. Cancellation.
All Preferred Securities Certificates surrendered for registration of transfer or exchange or
for payment shall, if surrendered to any Person other than the Property Trustee, be delivered to
the Property Trustee, and any such Preferred Securities Certificates and Preferred Securities
Certificates surrendered directly to the Property Trustee for any such purpose shall be promptly
canceled by it. The Administrative Trustees may at any time deliver to the Property Trustee for
cancellation any Preferred Securities Certificates previously delivered hereunder that the
Administrative Trustees may have acquired in any manner whatsoever, and all Preferred Securities
Certificates so delivered shall be promptly canceled by the Property Trustee. No Preferred
Securities Certificates shall be executed and delivered in lieu of or in exchange for any Preferred
Securities Certificates canceled as provided in this
Section 5.10
, except as expressly
29
permitted by this Trust Agreement. All canceled Preferred Securities Certificates shall be
disposed of by the Property Trustee in accordance with its customary practices and the Property
Trustee shall deliver to the Administrative Trustees a certificate of such disposition.
SECTION 5.11. Ownership of Common Securities by Depositor.
(a) On the Closing Date, the Depositor shall acquire, and thereafter shall retain, beneficial
and record ownership of the Common Securities. Neither the Depositor nor any successor Holder of
the Common Securities may transfer less than all the Common Securities, and the Depositor or any
such successor Holder may transfer the Common Securities only (i) in connection with a
consolidation or merger of the Depositor into another Person, or any conveyance, transfer or lease
by the Depositor of its properties and assets substantially as an entirety to any Person (in which
event such Common Securities will be transferred to such surviving entity, transferee or lessee, as
the case may be), pursuant to
Section 8.1
of the Indenture or (ii) to the Depositor or an
Affiliate of the Depositor, in each such case in compliance with applicable law (including the
Securities Act, and applicable state securities and blue sky laws). To the fullest extent permitted
by law, any attempted transfer of the Common Securities other than as set forth in the immediately
preceding sentence shall be void. The Administrative Trustees shall cause each Common Securities
Certificate issued to the Depositor to contain a legend stating substantially THIS CERTIFICATE IS
NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF THE TRUST AGREEMENT.
(b) Any Holder of the Common Securities shall be liable for the debts and obligations of the
Trust in the manner and to the extent set forth herein with respect to the Depositor and agrees
that it shall be subject to all liabilities to which the Depositor may be subject and, prior to
becoming such a Holder, shall deliver to the Administrative Trustees an instrument of assumption
satisfactory to such Trustees.
SECTION 5.12.
Restricted Legends
.
(a) Each Preferred Security Certificate shall bear a legend in substantially the following
form:
THIS PREFERRED SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE TRUST AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY
(DTC) OR A NOMINEE OF DTC. THIS PREFERRED SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE TRUST AGREEMENT, AND NO TRANSFER OF THIS PREFERRED SECURITY
(OTHER THAN A TRANSFER OF THIS PREFERRED SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR
BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
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UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO TEXAS
CAPITAL STATUTORY TRUST V OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY PREFERRED SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
SECURITIES ACT), AND SUCH PREFERRED SECURITIES OR ANY INTEREST THEREIN, MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF ANY PREFERRED SECURITIES IS HEREBY NOTIFIED THAT THE
SELLER OF THE PREFERRED SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A UNDER THE SECURITIES ACT.
THE HOLDER OF THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE AGREES FOR THE
BENEFIT OF THE TRUST AND THE DEPOSITOR THAT (A) SUCH PREFERRED SECURITIES MAY BE OFFERED,
RESOLD OR OTHERWISE TRANSFERRED ONLY (I) TO THE TRUST OR THE DEPOSITOR, (II) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III)
TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2),
(3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (V) PURSUANT TO AN EXEMPTION FROM THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND, IN THE CASE OF (III) OR (V), SUBJECT TO THE RIGHT OF THE
TRUST AND THE DEPOSITOR TO REQUIRE AN OPINION OF COUNSEL AND OTHER INFORMATION SATISFACTORY
TO EACH OF THEM AND (B) THE HOLDER WILL NOTIFY ANY PURCHASER OF ANY PREFERRED SECURITIES
FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
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THE PREFERRED SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN
AGGREGATE LIQUIDATION AMOUNT OF NOT LESS THAN $100,000. TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY ATTEMPTED TRANSFER OF PREFERRED SECURITIES, OR ANY INTEREST THEREIN, IN A BLOCK
HAVING AN AGGREGATE LIQUIDATION AMOUNT OF LESS THAN $100,000 AND MULTIPLES OF $1,000 IN
EXCESS THEREOF SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER
OF SUCH PREFERRED SECURITIES FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
THE LIQUIDATION AMOUNT OF OR DISTRIBUTIONS ON SUCH PREFERRED SECURITIES, OR ANY INTEREST
THEREIN, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN
SUCH PREFERRED SECURITIES.
THE HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (ERISA), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE CODE) (EACH A PLAN), OR AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY PLANS INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING PLAN ASSETS OF ANY PLAN MAY ACQUIRE OR HOLD THIS PREFERRED
SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE
EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS
EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE
AND HOLDING OF THIS SECURITY, OR ANY INTEREST THEREIN, IS NOT PROHIBITED BY SECTION 406 OF
ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR
HOLDER OF THE PREFERRED SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE
REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE
BENEFIT PLAN WITHIN THE MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF
THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT
PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR
PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A
PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
THERE IS NO APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.
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THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR
FUND OF THE UNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE
FDIC).
(b) The above legend shall not be removed from any of the Preferred Securities Certificates
unless there is delivered to the Property Trustee and the Depositor satisfactory evidence, which
may include an opinion of counsel, as may be reasonably required to ensure that any future
transfers thereof may be made without restriction under the provisions of the Securities Act and
other applicable law. Upon provision of such satisfactory evidence, one or more of the
Administrative Trustees on behalf of the Trust shall execute and deliver to the Property Trustee,
and the Property Trustee shall deliver, at the written direction of the Administrative Trustees and
the Depositor, Preferred Securities Certificates that do not bear the legend.
SECTION 5.13. Form of Certificate of Authentication.
The Property Trustees certificate of authentication shall be in substantially the
following form:
This is one of the Preferred Securities referred to in the within-mentioned Trust Agreement.
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Dated:
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WILMINGTON TRUST COMPANY, not in its individual capacity, but solely as Property Trustee
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By:
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Authorized officer
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ARTICLE VI.
Meetings; Voting; Acts of Holders
SECTION 6.1. Notice of Meetings.
Notice of all meetings of the Holders of the Preferred Securities, stating the time, place and
purpose of the meeting, shall be given by the Property Trustee pursuant to
Section 11.8
to
each Holder of Preferred Securities, at such Holders registered address, at least fifteen (15)
days and not more than ninety (90) days before the meeting. At any such meeting, any business
properly before the meeting may be so considered whether or not stated in the notice of the
meeting. Any adjourned meeting may be held as adjourned without further notice.
SECTION 6.2. Meetings of Holders of the Preferred Securities.
(a) No annual meeting of Holders is required to be held. The Property Trustee, however, shall
call a meeting of the Holders of the Preferred Securities to vote on any matter
33
upon the written request of the Holders of at least twenty five percent (25%) in aggregate
Liquidation Amount of the Outstanding Preferred Securities and the Administrative Trustees or the
Property Trustee may, at any time in their discretion, call a meeting of the Holders of the
Preferred Securities to vote on any matters as to which such Holders are entitled to vote.
(b) The Holders of at least a Majority in Liquidation Amount of the Preferred Securities,
present in person or by proxy, shall constitute a quorum at any meeting of the Holders of the
Preferred Securities.
(c) If a quorum is present at a meeting, an affirmative vote by the Holders present, in person
or by proxy, holding Preferred Securities representing at least a Majority in Liquidation Amount of
the Preferred Securities held by the Holders present, either in person or by proxy, at such meeting
shall constitute the action of the Holders of the Preferred Securities, unless this Trust Agreement
requires a lesser or greater number of affirmative votes.
SECTION 6.3. Voting Rights.
Holders shall be entitled to one vote for each $10,000 of Liquidation Amount represented by
their Outstanding Trust Securities in respect of any matter as to which such Holders are entitled
to vote.
SECTION 6.4. Proxies.
At any meeting of Holders, any Holder entitled to vote thereat may vote by proxy, provided,
that no proxy shall be voted at any meeting unless it shall have been placed on file with the
Administrative Trustees, or with such other officer or agent of the Trust as the Administrative
Trustees may direct, for verification prior to the time at which such vote shall be taken. Pursuant
to a resolution of the Property Trustee, proxies may be solicited in the name of the Property
Trustee or one or more officers of the Property Trustee. Only Holders of record shall be entitled
to vote. When Trust Securities are held jointly by several Persons, any one of them may vote at any
meeting in person or by proxy in respect of such Trust Securities, but if more than one of them
shall be present at such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in respect of such
Trust Securities. A proxy purporting to be executed by or on behalf of a Holder shall be deemed
valid unless challenged at or prior to its exercise, and the burden of proving invalidity shall
rest on the challenger. No proxy shall be valid more than three years after its date of execution.
SECTION 6.5. Holder Action by Written Consent.
Any action that may be taken by Holders at a meeting may be taken without a meeting and
without prior notice if Holders holding at least a Majority in Liquidation Amount of all Preferred
Securities entitled to vote in respect of such action (or such lesser or greater proportion thereof
as shall be required by any other provision of this Trust Agreement) shall consent to the action in
writing; provided, that notice of such action is promptly provided to the Holders of Preferred
Securities that did not consent to such action. Any action that may be taken by the Holders of all
the Common Securities may be taken without a meeting and without prior notice if such Holders shall
consent to the action in writing.
34
SECTION 6.6. Record Date for Voting and Other Purposes.
Except as provided in
Section 6.10(a)
, for the purposes of determining the Holders who
are entitled to notice of and to vote at any meeting or to act by written consent, or to
participate in any distribution on the Trust Securities in respect of which a record date is not
otherwise provided for in this Trust Agreement, or for the purpose of any other action, the
Administrative Trustees may from time to time fix a date, not more than ninety (90) days prior to
the date of any meeting of Holders or the payment of a Distribution or other action, as the case
may be, as a record date for the determination of the identity of the Holders of record for such
purposes.
SECTION 6.7. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action
provided or permitted by this Trust Agreement to be given, made or taken by Holders may be embodied
in and evidenced by one or more instruments of substantially similar tenor signed by such Holders
in person or by an agent thereof duly appointed in writing; and, except as otherwise expressly
provided herein, such action shall become effective when such instrument or instruments are
delivered to an Administrative Trustee. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the Act of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Trust Agreement and
conclusive in favor of the Trustees, if made in the manner provided in this
Section 6.7
.
(b) The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by a certificate of a notary public or
other officer authorized by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him the execution thereof. Where such execution
is by a signer acting in a capacity other than such signers individual capacity, such certificate
or affidavit shall also constitute sufficient proof of such signers authority. The fact and date
of the execution of any such instrument or writing, or the authority of the Person executing the
same, may also be proved in any other manner that any Trustee receiving the same deems sufficient.
(c) The ownership of Trust Securities shall be proved by the Securities Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the
Holder of any Trust Security shall bind every future Holder of the same Trust Security and the
Holder of every Trust Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the
Trustees, the Administrative Trustees or the Trust in reliance thereon, whether or not notation of
such action is made upon such Trust Security.
(e) Without limiting the foregoing, a Holder entitled hereunder to take any action hereunder
with regard to any particular Trust Security may do so with regard to all or any part of the
Liquidation Amount of such Trust Security or by one or more duly appointed agents each of
35
which may do so pursuant to such appointment with regard to all or any part of such
Liquidation Amount.
(f) If any dispute shall arise among the Holders or the Trustees with respect to the
authenticity, validity or binding nature of any request, demand, authorization, direction, notice,
consent, waiver or other Act of such Holder or Trustee under this
Article VI
, then the
determination of such matter by the Property Trustee shall be conclusive with respect to such
matter.
SECTION 6.8. Inspection of Records.
Upon reasonable written notice to the Administrative Trustees and the Property Trustee, the
records of the Trust shall be open to inspection by any Holder during normal business hours for any
purpose reasonably related to such Holders interest as a Holder.
SECTION 6.9. Limitations on Voting Rights.
(a) Except as expressly provided in this Trust Agreement and in the Indenture and as otherwise
required by law, no Holder of Preferred Securities shall have any right to vote or in any manner
otherwise control the administration, operation and management of the Trust or the obligations of
the parties hereto, nor shall anything herein set forth, or contained in the terms of the
Securities Certificates, be construed so as to constitute the Holders from time to time as partners
or members of an association.
(b) So long as any Notes are held by the Property Trustee on behalf of the Trust, the Property
Trustee shall not (i) direct the time, method and place of conducting any proceeding for any remedy
available to the Note Trustee, or exercise any trust or power conferred on the Property Trustee
with respect to the Notes, (ii) waive any past default that may be waived under
Section
5.13
of the Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the Notes shall be due and payable or (iv) consent to any amendment, modification
or termination of the Indenture or the Notes, where such consent shall be required, without, in
each case, obtaining the prior approval of the Holders of at least a Majority in Liquidation Amount
of the Preferred Securities; provided, that where a consent under the Indenture would require the
consent of each holder of Notes (or each Holder of Preferred Securities) affected thereby, no such
consent shall be given by the Property Trustee without the prior written consent of each Holder of
Preferred Securities. The Property Trustee shall not revoke any action previously authorized or
approved by a vote of the Holders of the Preferred Securities, except by a subsequent vote of the
Holders of the Preferred Securities. In addition to obtaining the foregoing approvals of the
Holders of the Preferred Securities, prior to taking any of the foregoing actions, the Property
Trustee shall, at the expense of the Depositor, obtain an Opinion of Counsel experienced in such
matters to the effect that such action shall not cause the Trust to be taxable as a corporation or
classified as other than a grantor trust for United States federal income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the Trustees otherwise
propose to effect, (i) any action that would adversely affect in any material respect the powers,
preferences or special rights of the Preferred Securities, whether by way of amendment
36
to the Trust Agreement or otherwise or (ii) the dissolution, winding-up or termination of the
Trust, other than pursuant to the terms of this Trust Agreement, then the Holders of Outstanding
Preferred Securities as a class will be entitled to vote on such amendment or proposal and such
amendment or proposal shall not be effective except with the approval of the Holders of at least a
Majority in Liquidation Amount of the Preferred Securities. Notwithstanding any other provision of
this Trust Agreement, no amendment to this Trust Agreement may be made if, as a result of such
amendment, it would cause the Trust to be taxable as a corporation or classified as other than a
grantor trust for United States federal income tax purposes.
SECTION 6.10. Acceleration of Maturity; Rescission of Annulment; Waivers of Past Defaults.
(a) For so long as any Preferred Securities remain Outstanding, if, upon a Note Event of
Default pursuant to paragraphs (c), (e) or (f) of
Section 5.1
of the Indenture, the Note
Trustee fails or the holders of not less than twenty five percent (25%) in principal amount of the
outstanding Notes fail to declare the principal of all of the Notes to be immediately due and
payable, the Holders of at least twenty-five percent (25%) in Liquidation Amount of the Preferred
Securities then Outstanding shall have the right to make such declaration by a notice in writing to
the Property Trustee, the Depositor and the Note Trustee. At any time after a declaration of
acceleration with respect to the Notes has been made and before a judgment or decree for payment of
the money due has been obtained by the Note Trustee as provided in the Indenture, the Holders of at
least a Majority in Liquidation Amount of the Preferred Securities, by written notice to the
Property Trustee, the Depositor and the Note Trustee, may rescind and annul such declaration and
its consequences if:
(i) the Depositor has paid or deposited with the Note Trustee a sum sufficient to pay:
(A) all overdue installments of interest on all of the Notes;
(B) any accrued Additional Interest on all of the Notes;
(C) the principal of and any premium on any Notes that have become due
otherwise than by such declaration of acceleration and interest and Additional
Interest thereon at the rate borne by the Notes; and
(D) all sums paid or advanced by the Note Trustee under the Indenture and the
reasonable compensation, expenses, disbursements and advances of the Note Trustee,
the Property Trustee and their agents and counsel; and
(ii) all Note Events of Default, other than the non-payment of the principal of the
Notes that has become due solely by such acceleration, have been cured or waived as provided
in
Section 5.13
of the Indenture.
Upon receipt by the Property Trustee of written notice requesting such an acceleration, or
rescission and annulment thereof, by Holders of any part of the Preferred Securities, a record date
shall be established for determining Holders of Outstanding Preferred Securities entitled to join
in such notice, which record date shall be at the close of business on the day the Property
37
Trustee receives such notice. The Holders on such record date, or their duly designated
proxies, and only such Persons, shall be entitled to join in such notice, whether or not such
Holders remain Holders after such record date; provided, that, unless such declaration of
acceleration, or rescission and annulment, as the case may be, shall have become effective by
virtue of the requisite percentage having joined in such notice prior to the day that is ninety
(90) days after such record date, such notice of declaration of acceleration, or rescission and
annulment, as the case may be, shall automatically and without further action by any Holder be
canceled and of no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such ninety (90)-day period, a new written notice of
declaration of acceleration, or rescission and annulment thereof, as the case may be, that is
identical to a written notice that has been canceled pursuant to the proviso to the preceding
sentence, in which event a new record date shall be established pursuant to the provisions of this
Section 6.10(a)
.
(b) For so long as any Preferred Securities remain Outstanding, to the fullest extent
permitted by law and subject to the terms of this Trust Agreement and the Indenture, upon a Note
Event of Default specified in paragraph (a), (b) or (c) of
Section 5.1
of the Indenture,
any Holder of Preferred Securities shall have the right to institute a proceeding directly against
the Depositor, pursuant to
Section 5.8
of the Indenture, for enforcement of payment to such
Holder of any amounts payable in respect of Notes having an aggregate principal amount equal to the
aggregate Liquidation Amount of the Preferred Securities of such Holder. Except as set forth in
Section 6.10(a)
and this
Section 6.10(b)
, the Holders of Preferred Securities shall
have no right to exercise directly any right or remedy available to the holders of, or in respect
of, the Notes.
(c) Notwithstanding paragraphs (a) and (b) of this
Section 6.10
, the Holders of at
least a Majority in Liquidation Amount of the Preferred Securities may, on behalf of the Holders of
all the Preferred Securities, waive any Note Event of Default, except any Note Event of Default
arising from the failure to pay any principal of or any premium or interest on (including any
Additional Interest) the Notes (unless such Note Event of Default has been cured and a sum
sufficient to pay all matured installments of interest and all principal and premium on all Notes
due otherwise than by acceleration has been deposited with the Note Trustee) or a Note Event of
Default in respect of a covenant or provision that under the Indenture cannot be modified or
amended without the consent of the holder of each outstanding Note. Upon any such waiver, such
Note Event of Default shall cease to exist and any Note Event of Default arising therefrom shall be
deemed to have been cured for every purpose of the Indenture; but no such waiver shall affect any
subsequent Note Event of Default or impair any right consequent thereon.
(d) Notwithstanding paragraphs (a) and (b) of this
Section 6.10
, the Holders of at
least a Majority in Liquidation Amount of the Preferred Securities may, on behalf of the Holders of
all the Preferred Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Trust Agreement, but no such waiver
shall extend to any subsequent or other Event of Default or impair any right consequent thereon.
(e) The Holders of a Majority in Liquidation Amount of the Preferred Securities shall have the
right to direct the time, method and place of conducting any proceeding for any remedy available to
the Property Trustee in respect of this Trust Agreement or the Notes or exercising
38
any trust or power conferred upon the Property Trustee under this Trust Agreement; provided,
that, subject to
Sections 8.5
and
8.7
, the Property Trustee shall have the right to
decline to follow any such direction if the Property Trustee being advised by counsel determines
that the action so directed may not lawfully be taken, or if the Property Trustee in good faith
shall, by an officer or officers of the Property Trustee, determine that the proceedings so
directed would be illegal or involve it in personal liability or be unduly prejudicial to the
rights of Holders not party to such direction, and provided, further, that nothing in this Trust
Agreement shall impair the right of the Property Trustee to take any action deemed proper by the
Property Trustee and which is not inconsistent with such direction.
ARTICLE VII.
Representations and Warranties
SECTION 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally on behalf of and as to itself,
hereby represents and warrants for the benefit of the Depositor and the Holders that:
(a) the Property Trustee is a Delaware banking corporation, duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(b) the Property Trustee has full corporate power, authority and legal right to execute,
deliver and perform its obligations under this Trust Agreement and has taken all necessary action
to authorize the execution, delivery and performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware banking corporation, duly organized, validly existing
and in good standing under the laws of the State of Delaware;
(d) the Delaware Trustee has full corporate power, authority and legal right to execute,
deliver and perform its obligations under this Trust Agreement and has taken all necessary action
to authorize the execution, delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and delivered by the Property
Trustee and the Delaware Trustee and constitutes the legal, valid and binding agreement of each of
the Property Trustee and the Delaware Trustee enforceable against each of them in accordance with
its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors
rights generally and to general principles of equity;
(f) the execution, delivery and performance of this Trust Agreement have been duly authorized
by all necessary corporate or other action on the part of the Property Trustee and the Delaware
Trustee and do not require any approval of stockholders of the Property Trustee and the Delaware
Trustee and such execution, delivery and performance will not (i) violate the Certificate of
Incorporation or By-laws of the Property Trustee or the Delaware Trustee or (ii) violate any
applicable law, governmental rule or regulation of the United States or the State of Delaware, as
the case may be, governing the banking, trust or general powers of the Property
39
Trustee or the Delaware Trustee or any order, judgment or decree applicable to the Property
Trustee or the Delaware Trustee;
(g) neither the authorization, execution or delivery by the Property Trustee or the Delaware
Trustee of this Trust Agreement nor the consummation of any of the transactions by the Property
Trustee or the Delaware Trustee contemplated herein requires the consent or approval of, the giving
of notice to, the registration with or the taking of any other action with respect to any
governmental authority or agency under any existing law of the United States or the State of
Delaware governing the banking, trust or general powers of the Property Trustee or the Delaware
Trustee, as the case may be; and
(h) to the best of each of the Property Trustees and the Delaware Trustees knowledge, there
are no proceedings pending or threatened against or affecting the Property Trustee or the Delaware
Trustee in any court or before any governmental authority, agency or arbitration board or tribunal
that, individually or in the aggregate, would materially and adversely affect the Trust or would
question the right, power and authority of the Property Trustee or the Delaware Trustee, as the
case may be, to enter into or perform its obligations as one of the Trustees under this Trust
Agreement.
SECTION 7.2. Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the Holders that:
(a) the Depositor is a corporation duly organized, validly existing and in good standing under
the laws of its state of incorporation;
(b) the Depositor has full corporate power, authority and legal right to execute, deliver and
perform its obligations under this Trust Agreement and has taken all necessary action to authorize
the execution, delivery and performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and delivered by the Depositor and
constitutes the legal, valid and binding agreement of the Depositor enforceable against the
Depositor in accordance with its terms, subject to applicable bankruptcy, insolvency and similar
laws affecting creditors rights generally and to general principles of equity;
(d) the Securities Certificates issued at the Closing Date on behalf of the Trust have been
duly authorized and will have been duly and validly executed, issued and delivered by the
applicable Trustees pursuant to the terms and provisions of, and in accordance with the
requirements of, this Trust Agreement and the Holders will be, as of such date, entitled to the
benefits of this Trust Agreement;
(e) the execution, delivery and performance of this Trust Agreement have been duly authorized
by all necessary corporate or other action on the part of the Depositor and do not require any
approval of stockholders of the Depositor and such execution, delivery and performance will not (i)
violate the articles or certificate of incorporation or by-laws (or other organizational documents)
of the Depositor or (ii) violate any applicable law, governmental rule or regulation governing the
Depositor or any material portion of its property or any order, judgment or decree applicable to
the Depositor or any material portion of its property;
40
(f) neither the authorization, execution or delivery by the Depositor of this Trust Agreement
nor the consummation of any of the transactions by the Depositor contemplated herein requires the
consent or approval of, the giving of notice to, the registration with or the taking of any other
action with respect to any governmental authority or agency under any existing law governing the
Depositor or any material portion of its property; and
(g) there are no proceedings pending or, to the best of the Depositors knowledge, threatened
against or affecting the Depositor or any material portion of its property in any court or before
any governmental authority, agency or arbitration board or tribunal that, individually or in the
aggregate, would materially and adversely affect the Trust or would question the right, power and
authority of the Depositor, as the case may be, to enter into or perform its obligations under this
Trust Agreement.
ARTICLE VIII.
The Trustees
SECTION 8.1. Number of Trustees.
The number of Trustees shall be four (4), provided, that the Property Trustee and the Delaware
Trustee may be the same Person, in which case the number of Trustees shall be three (3). The
number of Trustees may be increased or decreased by Act of the Holder of the Common Securities
subject to
Sections 8.2
,
8.3
, and
8.4
. The death, resignation, retirement,
removal, bankruptcy, incompetence or incapacity to perform the duties of a Trustee shall not
operate to annul, dissolve or terminate the Trust.
SECTION 8.2. Property Trustee Required.
There shall at all times be a Property Trustee hereunder with respect to the Trust Securities.
The Property Trustee shall be a corporation organized and doing business under the laws of the
United States or of any state thereof, authorized to exercise corporate trust powers, having a
combined capital and surplus of at least fifty million dollars ($50,000,000), subject to
supervision or examination by federal or state authority and having an office within the United
States. If any such Person publishes reports of condition at least annually pursuant to law or to
the requirements of its supervising or examining authority, then for the purposes of this
Section 8.2
, the combined capital and surplus of such Person shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition so published. If
at any time the Property Trustee shall cease to be eligible in accordance with the provisions of
this
Section 8.2
, it shall resign immediately in the manner and with the effect hereinafter
specified in this
Article VIII
.
SECTION 8.3. Delaware Trustee Required.
(a) If required by the Delaware Statutory Trust Act, there shall at all times be a Delaware
Trustee with respect to the Trust Securities. The Delaware Trustee shall either be (i) a natural
person who is at least 21 years of age and a resident of the State of Delaware or (ii) a legal
entity that has its principal place of business in the State of Delaware, otherwise meets the
requirements of applicable Delaware law and shall act through one or more persons authorized to
41
bind such entity. If at any time the Delaware Trustee shall cease to be eligible in
accordance with the provisions of this
Section 8.3
, it shall resign immediately in the
manner and with the effect hereinafter specified in this
Article VIII
.
(b) The Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware
Trustee have any of the duties and responsibilities, of the Property Trustee or the Administrative
Trustees set forth herein. The Delaware Trustee shall be one of the trustees of the Trust for the
sole and limited purpose of fulfilling the requirements of Section 3807 of the Delaware Statutory
Trust Act and for taking such actions as are required to be taken by a Delaware trustee under the
Delaware Statutory Trust Act. The duties (including fiduciary duties), liabilities and obligations
of the Delaware Trustee shall be limited to (a) accepting legal process served on the Trust in the
State of Delaware and (b) the execution of any certificates required to be filed with the Secretary
of State of the State of Delaware that the Delaware Trustee is required to execute under Section
3811 of the Delaware Statutory Trust Act and there shall be no other duties (including fiduciary
duties) or obligations, express or implied, at law or in equity, of the Delaware Trustee.
SECTION 8.4. Appointment of Administrative Trustees.
(a) There shall at all times be one or more Administrative Trustees hereunder with respect to
the Trust Securities. Each Administrative Trustee shall be either a natural person who is at least
21 years of age or a legal entity that shall act through one or more persons authorized to bind
that entity. Each of the individuals identified as an Administrative Trustee in the preamble of
this Trust Agreement hereby accepts his or her appointment as such.
(b) Except where a requirement for action by a specific number of Administrative Trustees is
expressly set forth in this Trust Agreement, any act required or permitted to be taken by, and any
power of the Administrative Trustees may be exercised by, or with the consent of, any one such
Administrative Trustee. Whenever a vacancy in the number of Administrative Trustees shall occur,
until such vacancy is filled by the appointment of an Administrative Trustee in accordance with
Section 8.11
, the Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Trust Agreement), shall have all the powers granted to
the Administrative Trustees and shall discharge all the duties imposed upon the Administrative
Trustees by this Trust Agreement.
SECTION 8.5. Duties and Responsibilities of the Trustees.
(a) The rights, immunities, duties and responsibilities of the Trustees shall be as provided
by this Trust Agreement and there shall be no other duties (including fiduciary duties) or
obligations, express or implied, at law or in equity, of the Trustees; provided, however, that if
an Event of Default known to the Property Trustee has occurred and is continuing, the Property
Trustee shall, prior to the receipt of directions, if any, from the Holders of at least a Majority
in Liquidation Amount of the Preferred Securities, exercise such of the rights and powers vested in
it by this Trust Agreement, and use the same degree of care and skill in its exercise, as a prudent
person would exercise or use under the circumstances in the conduct of such persons own affairs.
Notwithstanding the foregoing, no provision of this Trust Agreement shall require any of the
Trustees to expend or risk its own funds or otherwise incur any financial liability in the
42
performance of any of its duties hereunder, or in the exercise of any of its or their rights
or powers, if it or they shall have reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or
not herein expressly so provided, every provision of this Trust Agreement relating to the conduct
or affecting the liability of or affording protection to the Trustees shall be subject to the
provisions of this
Section 8.5
. To the extent that, at law or in equity, a Trustee has
duties and liabilities relating to the Trust or to the Holders, such Trustee shall not be liable to
the Trust or to any Holder for such Trustees good faith reliance on the provisions of this Trust
Agreement. The provisions of this Trust Agreement, to the extent that they restrict the duties and
liabilities of the Trustees otherwise existing at law or in equity, are agreed by the Depositor and
the Holders to replace such other duties and liabilities of the Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect of the Trust
Securities shall be made only from the revenue and proceeds from the Trust Property and only to the
extent that there shall be sufficient revenue or proceeds from the Trust Property to enable the
Property Trustee or a Paying Agent to make payments in accordance with the terms hereof. Each
Holder, by its acceptance of a Trust Security, agrees that it will look solely to the revenue and
proceeds from the Trust Property to the extent legally available for distribution to it as herein
provided and that the Trustees are not personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in respect of any Trust Security. This
Section 8.5(b)
does not limit the liability of the Trustees expressly set forth elsewhere
in this Trust Agreement.
(c) No provisions of this Trust Agreement shall be construed to relieve the Property Trustee
from liability with respect to matters that are within the authority of the Property Trustee under
this Trust Agreement for its own negligent action, negligent failure to act or willful misconduct,
except that:
(i) the Property Trustee shall not be liable for any error or judgment made in good
faith by an authorized officer of the Property Trustee, unless it shall be proved that the
Property Trustee was negligent in ascertaining the pertinent facts;
(ii) the Property Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the Holders of
at least a Majority in Liquidation Amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to the Property
Trustee hereunder or under the Indenture, or exercising any trust or power conferred upon
the Property Trustee under this Trust Agreement;
(iii) the Property Trustees sole duty with respect to the custody, safe keeping and
physical preservation of the Notes and the Payment Account shall be to deal with such
Property in a similar manner as the Property Trustee deals with similar property for its own
account, subject to the protections and limitations on liability afforded to the Property
Trustee under this Trust Agreement;
(iv) the Property Trustee shall not be liable for any interest on any money received by
it except as it may otherwise agree with the Depositor; and money held by
43
the Property Trustee need not be segregated from other funds held by it except in
relation to the Payment Account maintained by the Property Trustee pursuant to Section 3.1
and except to the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring the compliance by the
Administrative Trustees or the Depositor with their respective duties under this Trust
Agreement, nor shall the Property Trustee be liable for the default or misconduct of any
other Trustee or the Depositor.
SECTION 8.6. Notices of Defaults and Extensions.
(a) Within ninety (90) days after the occurrence of a default actually known to the Property
Trustee, the Property Trustee shall transmit notice of such default to the Holders, the
Administrative Trustees and the Depositor, unless such default shall have been cured or waived;
provided, that, except in the case of a default in the payment of the principal of or any premium
or interest (including any Additional Interest) on any Trust Security, the Property Trustee shall
be fully protected in withholding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors and/or Responsible Officers of the Property
Trustee in good faith determines that the withholding of such notice is in the interests of the
Holders of the Trust Securities. For the purpose of this
Section 8.6
, the term default
means any event that is, or after notice or lapse of time or both would become, an Event of
Default.
(b) Within three (3) Business Days after the receipt of notice of the Depositors exercise of
its right to defer the payment of interest on the Notes pursuant to the Indenture, the Property
Trustee shall transmit, in the manner and to the extent provided in
Section 11.8
, notice of
such exercise to the Holders and the Administrative Trustees, unless such exercise shall have been
revoked.
(c) The Property Trustee shall not be deemed to have knowledge of any Event of Default unless
the Property Trustee shall have received written notice thereof from the Depositor, any
Administrative Trustee or any Holder or unless an officer of the Property Trustee charged with the
administration of this Trust Agreement shall have obtained actual knowledge of such Event of
Default.
(d) The Property Trustee shall notify all Holders of the Preferred Securities of any notice of
default received with respect to the Notes.
SECTION 8.7. Certain Rights of Property Trustee.
Subject to the provisions of
Section 8.5
:
(a) the Property Trustee may conclusively rely and shall be protected in acting or refraining
from acting in good faith and in accordance with the terms hereof upon any resolution, Opinion of
Counsel, certificate, written representation of a Holder or transferee, certificate of auditors or
any other resolution, certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or
other paper or document believed by it to be genuine and to have been signed or presented by the
proper party or parties;
44
(b) if (i) in performing its duties under this Trust Agreement the Property Trustee is
required to decide between alternative courses of action, (ii) in construing any of the provisions
of this Trust Agreement the Property Trustee finds a provision ambiguous or inconsistent with any
other provisions contained herein or (iii) the Property Trustee is unsure of the application of any
provision of this Trust Agreement, then, except as to any matter as to which the Holders of the
Preferred Securities are entitled to vote under the terms of this Trust Agreement, the Property
Trustee shall deliver a notice to the Depositor requesting the Depositors written instruction as
to the course of action to be taken and the Property Trustee shall take such action, or refrain
from taking such action, as the Property Trustee shall be instructed in writing to take, or to
refrain from taking, by the Depositor; provided, that if the Property Trustee does not receive such
instructions of the Depositor within ten (10) Business Days after it has delivered such notice or
such reasonably shorter period of time set forth in such notice, the Property Trustee may, but
shall be under no duty to, take such action, or refrain from taking such action, as the Property
Trustee shall deem advisable and in the best interests of the Holders, in which event the Property
Trustee shall have no liability except for its own negligence, bad faith or willful misconduct;
(c) any direction or act of the Depositor contemplated by this Trust Agreement shall be
sufficiently evidenced by an Officers Certificate unless otherwise expressly provided herein;
(d) any direction or act of an Administrative Trustee contemplated by this Trust Agreement
shall be sufficiently evidenced by a certificate executed by such Administrative Trustee and
setting forth such direction or act;
(e) the Property Trustee shall have no duty to see to any recording, filing or registration of
any instrument (including any financing or continuation statement or any filing under tax or
securities laws) or any re-recording, re-filing or re-registration thereof;
(f) the Property Trustee may consult with counsel (which counsel may be counsel to the
Property Trustee, the Depositor or any of its Affiliates, and may include any of its employees) and
the advice of such counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon and in
accordance with such advice; the Property Trustee shall have the right at any time to seek
instructions concerning the administration of this Trust Agreement from any court of competent
jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Trust Agreement at the request or direction of any of the Holders pursuant to
this Trust Agreement, unless such Holders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses (including reasonable attorneys fees and
expenses) and liabilities that might be incurred by it in compliance with such request or
direction, including reasonable advances as may be requested by the Property Trustee;
(h) the Property Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, approval, bond, debenture, note or other evidence of
indebtedness or other paper or document, unless requested in writing to do so by one or more
Holders, but the Property Trustee may make such further inquiry or investigation into such facts
45
or matters as it may see fit, and, if the Property Trustee shall determine to make such
inquiry or investigation, it shall be entitled to examine the books, records and premises of the
Depositor, personally or by agent or attorney;
(i) the Property Trustee may execute any of the trusts or powers hereunder or perform any
duties hereunder either directly or by or through its agents, attorneys, custodians or nominees and
the Property Trustee shall not be responsible for any negligence or misconduct on the part of any
such agent, attorney, custodian or nominee appointed with due care by it hereunder;
(j) whenever in the administration of this Trust Agreement the Property Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right hereunder, the
Property Trustee (i) may request instructions from the Holders (which instructions may only be
given by the Holders of the same proportion in Liquidation Amount of the Trust Securities as would
be entitled to direct the Property Trustee under this Trust Agreement in respect of such remedy,
right or action), (ii) may refrain from enforcing such remedy or right or taking such other action
until such instructions are received and (iii) shall be protected in acting in accordance with such
instructions;
(k) except as otherwise expressly provided by this Trust Agreement, the Property Trustee shall
not be under any obligation to take any action that is discretionary under the provisions of this
Trust Agreement;
(l) without prejudice to any other rights available to the Property Trustee under applicable
law, when the Property Trustee incurs expenses or renders services in connection with a Bankruptcy
Event, such expenses (including legal fees and expenses of its agents and counsel) and the
compensation for such services are intended to constitute expenses of administration under any
bankruptcy law or law relating to creditors rights generally; and
(m) whenever in the administration of this Trust Agreement the Property Trustee shall deem it
desirable that a matter be proved or established prior to taking, suffering or omitting any action
hereunder, the Property Trustee (unless other evidence be herein specifically prescribed) may, in
the absence of bad faith on its part, request and rely on an Officers Certificate which, upon
receipt of such request, shall be promptly delivered by the Depositor.
No provision of this Trust Agreement shall be deemed to impose any duty or obligation on any
Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or
imposed on it, in any jurisdiction in which it shall be illegal, or in which such Person shall be
unqualified or incompetent in accordance with applicable law, to perform any such act or acts, or
to exercise any such right, power, duty or obligation.
SECTION 8.8. Delegation of Power.
Any Trustee may, by power of attorney consistent with applicable law, delegate to any other
natural person over the age of 21 its, his or her power for the purpose of executing any documents
contemplated in
Section 2.5
. The Trustees shall have power to delegate from time to time
to such of their number or to the Depositor the doing of such things and the execution of such
instruments either in the name of the Trust or the names of the Trustees or otherwise as the
46
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of this Trust Agreement.
SECTION 8.9. May Hold Securities.
Any Trustee or any other agent of any Trustee or the Trust, in its individual or any other
capacity, may become the owner or pledgee of Trust Securities and except as provided in the
definition of the term Outstanding in
Article I
, may otherwise deal with the Trust with
the same rights it would have if it were not a Trustee or such other agent.
SECTION 8.10. Compensation; Reimbursement; Indemnity.
The Depositor agrees:
(a) to pay to the Trustees from time to time such reasonable compensation for all services
rendered by them hereunder as may be agreed by the Depositor and the Trustees from time to time
(which compensation shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) to reimburse the Trustees upon request for all reasonable expenses, disbursements and
advances incurred or made by the Trustees in accordance with any provision of this Trust Agreement
(including the reasonable compensation and the expenses and disbursements of their agents and
counsel), except any such expense, disbursement or advance as may be attributable to their
negligence, bad faith or willful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify and hold harmless (i) each
Trustee, (ii) any Affiliate of any Trustee, (iii) any officer, director, shareholder, employee,
representative or agent of any Trustee or any Affiliate of any Trustee and (iv) any employee or
agent of the Trust (referred to herein as an Indemnified Person) from and against any loss,
damage, liability, tax (other than income, franchise or other taxes imposed on amounts paid
pursuant to
Section 8.10(a)
or
(b)
hereof), penalty, expense, suit or claim of any
kind or nature whatsoever incurred without negligence, bad faith or willful misconduct on its part,
arising out of or in connection with the acceptance or administration of the Trust hereunder,
including the advancement of funds to cover the reasonable costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of any of its powers
or duties hereunder.
The Trust shall have no payment, reimbursement or indemnity obligations to the Trustees under
this
Section 8.10
. The provisions of this
Section 8.10
shall survive the
termination of this Trust Agreement and the earlier removal or resignation of any Trustee.
No Trustee may claim any Lien on any Trust Property whether before or after termination of the
Trust as a result of any amount due pursuant to this
Section 8.10
.
To the fullest extent permitted by law, in no event shall the Property Trustee and the
Delaware Trustee be liable for any indirect, special, punitive or consequential loss or damage of
any kind whatsoever, including, but not limited to, lost profits, even if the Trustee has been
advised of the likelihood of such loss or damage and regardless of the form of action.
47
In no event shall the Property Trustee and the Delaware Trustee be liable for any failure or
delay in the performance of its obligations hereunder because of circumstances beyond its control,
including, but not limited to, acts of God, flood, war (whether declared or undeclared), terrorism,
fire, riot, embargo, government action, including any laws, ordinances, regulations, governmental
action or the like which delay, restrict or prohibit the providing of the services contemplated by
this Trust Agreement.
SECTION 8.11. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of any Trustee and no appointment of a successor Trustee
pursuant to this
Article VIII
shall become effective until the acceptance of appointment by
the successor Trustee in accordance with the applicable requirements of
Section 8.12
.
(b) A Trustee may resign at any time by giving written notice thereof to the Depositor and, in
the case of the Property Trustee and the Delaware Trustee, to the Holders.
(c) Unless an Event of Default shall have occurred and be continuing, the Property Trustee or
the Delaware Trustee, or both of them, may be removed (with or without cause) at any time by Act of
the Holder of Common Securities. If an Event of Default shall have occurred and be continuing, the
Property Trustee or the Delaware Trustee, or both of them, may be removed (with or without cause)
at such time by Act of the Holders of at least a Majority in Liquidation Amount of the Preferred
Securities, delivered to the removed Trustee (in its individual capacity and on behalf of the
Trust). An Administrative Trustee may be removed (with or without cause) only by Act of the Holder
of the Common Securities at any time.
(d) If any Trustee shall resign, be removed or become incapable of acting as Trustee, or if a
vacancy shall occur in the office of any Trustee for any reason, at a time when no Event of Default
shall have occurred and be continuing, the Holder of the Common Securities, by Act of the Holder of
the Common Securities, shall promptly appoint a successor Trustee or Trustees, and such successor
Trustee and the retiring Trustee shall comply with the applicable requirements of
Section
8.12
. If the Property Trustee or the Delaware Trustee shall resign, be removed or become
incapable of continuing to act as the Property Trustee or the Delaware Trustee, as the case may be,
at a time when an Event of Default shall have occurred and be continuing, the Holders of the
Preferred Securities, by Act of the Holders of a Majority in Liquidation Amount of the Preferred
Securities, shall promptly appoint a successor Property Trustee or Delaware Trustee, and such
successor Property Trustee or Delaware Trustee and the retiring Property Trustee or Delaware
Trustee shall comply with the applicable requirements of
Section 8.12
. If an
Administrative Trustee shall resign, be removed or become incapable of acting as Administrative
Trustee, at a time when an Event of Default shall have occurred and be continuing, the Holder of
the Common Securities by Act of the Holder of Common Securities shall promptly appoint a successor
Administrative Trustee and such successor Administrative Trustee and the retiring Administrative
Trustee shall comply with the applicable requirements of
Section 8.12
. If no successor
Trustee shall have been so appointed by the Holder of the Common Securities or Holders of the
Preferred Securities, as the case may be, and accepted appointment in the manner required by
Section 8.12
within thirty (30) days after the giving of a notice of resignation by a
Trustee, the removal of a Trustee, or a Trustee becoming incapable of acting as such Trustee, any
Holder who has been a Holder of Preferred Securities for at least six
48
(6) months may, on behalf of himself and all others similarly situated, and any resigning
Trustee may, in each case, at the expense of the Depositor, petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(e) The Depositor shall give notice of each resignation and each removal of the Property
Trustee or the Delaware Trustee and each appointment of a successor Property Trustee or Delaware
Trustee to all Holders in the manner provided in
Section 11.8
. Each notice shall include
the name of the successor Property Trustee or Delaware Trustee and the address of its Corporate
Trust Office if it is the Property Trustee.
(f) Notwithstanding the foregoing or any other provision of this Trust Agreement, in the event
any Administrative Trustee or a Delaware Trustee who is a natural person dies or becomes, in the
opinion of the Holder of Common Securities, incompetent or incapacitated, the vacancy created by
such death, incompetence or incapacity may be filled by (i) the unanimous act of the remaining
Administrative Trustees if there are at least two of them or (ii) otherwise by the Holder of the
Common Securities (with the successor in each case being a Person who satisfies the eligibility
requirement for Administrative Trustees or Delaware Trustee, as the case may be, set forth in
Sections 8.3
and
8.4
).
(g) Upon the appointment of a successor Delaware Trustee, such successor Delaware Trustee
shall file a Certificate of Amendment to the Certificate of Trust in accordance with Section 3810
of the Delaware Statutory Trust Act.
SECTION 8.12. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee, each successor Trustee shall
execute and deliver to the Depositor and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee shall become
effective and each such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on
request of the Trust or any successor Trustee such retiring Trustee shall, upon payment of its
charges, duly assign, transfer and deliver to such successor Trustee all Trust Property, all
proceeds thereof and money held by such retiring Trustee hereunder with respect to the Trust
Securities and the Trust.
(b) Upon request of any such successor Trustee, the Trust (or the retiring Trustee if
requested by the Depositor) shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to
in the preceding paragraph.
(c) No successor Trustee shall accept its appointment unless at the time of such acceptance
such successor Trustee shall be qualified and eligible under this
Article VIII
.
SECTION 8.13. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee may be merged or converted
or with which it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which such Trustee shall be a party, or any Person succeeding to
49
all or substantially all the corporate trust business of such Trustee, shall be the successor
of such Trustee hereunder, without the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided, that such Person shall be otherwise qualified and
eligible under this
Article VIII
.
SECTION 8.14. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities Certificates shall be taken as the
statements of the Trust and the Depositor, and the Trustees do not assume any responsibility for
their correctness. The Trustees make no representations as to the title to, or value or condition
of, the property of the Trust or any part thereof, nor as to the validity or sufficiency of this
Trust Agreement, the Notes or the Trust Securities. The Trustees shall not be accountable for the
use or application by the Depositor of the proceeds of the Notes.
SECTION 8.15. Property Trustee May File Proofs of Claim.
(a) In case of any Bankruptcy Event (or event that with the passage of time would become a
Bankruptcy Event) relative to the Trust or any other obligor upon the Trust Securities or the
property of the Trust or of such other obligor or their creditors, the Property Trustee
(irrespective of whether any Distributions on the Trust Securities shall then be due and payable
and irrespective of whether the Property Trustee shall have made any demand on the Trust for the
payment of any past due Distributions) shall be entitled and empowered, to the fullest extent
permitted by law, by intervention in such proceeding or otherwise:
(i) to file and prove a claim for the whole amount of any Distributions owing and
unpaid in respect of the Trust Securities and to file such other papers or documents as may
be necessary or advisable in order to have the claims of the Property Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding; and
(ii) to collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such proceeding is hereby authorized by each Holder to make such payments to the Property
Trustee and, in the event the Property Trustee shall consent to the making of such payments
directly to the Holders, to pay to the Property Trustee first any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel,
and any other amounts due the Property Trustee.
(b) Nothing herein contained shall be deemed to authorize the Property Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or compensation affecting the Trust Securities or the rights of any Holder thereof or to
authorize the Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
50
SECTION 8.16. Reports to and from the Property Trustee.
(a) The Depositor and the Administrative Trustees shall deliver to the Property Trustee, not
later than forty five (45) days after the end of each of the first three fiscal quarters of the
Depositor and not later than ninety (90) days after the end of each fiscal year of the Depositor
ending after the date of this Trust Agreement, an Officers Certificate covering the preceding
fiscal period, stating whether or not to the knowledge of the signers thereof the Depositor and the
Trust are in default in the performance or observance of any of the terms, provisions and
conditions of this Trust Agreement (without regard to any period of grace or requirement of notice
provided hereunder) and, if the Depositor or the Trust shall be in default, specifying all such
defaults and the nature and status thereof of which they have knowledge.
(b) The Depositor shall furnish to (i) the Property Trustee, (ii) the Purchaser, (iii) any
Owner of the Preferred Securities reasonably identified to the Depositor or the Trust (which
identification may be made either by such Owner or by the Placement Agent or Purchaser), and (iv)
any designee of (i), (ii) or (iii) above, a duly completed and executed certificate in the form
attached hereto as Exhibit G, including the financial statements referenced in such Exhibit, which
certificate and financial statements shall be so furnished by the Depositor not later than forty
five (45) days after the end of each of the first three fiscal quarters of each fiscal year of the
Depositor and not later than ninety (90) days after the end of each fiscal year of the Depositor.
(c) The Property Trustee shall obtain all reports, certificates and information, which it is
entitled to receive under each of the Operative Documents, and deliver to (i) the Purchaser, (ii)
the Placement Agent and (iii) a designee of (i) or (ii) above, all such reports, certificates or
information promptly upon receipt thereof.
ARTICLE IX.
Termination, Liquidation and Merger
SECTION 9.1. Dissolution Upon Expiration Date.
Unless earlier dissolved, the Trust shall automatically dissolve on December 31, 2037 (the
Expiration Date), and the Trust Property shall be liquidated in accordance with
Section
9.4
.
SECTION 9.2. Early Termination.
The first to occur of any of the following events is an Early Termination Event, upon the
occurrence of which the Trust shall be dissolved:
(a) the occurrence of a Bankruptcy Event in respect of, or the dissolution or liquidation of,
the Depositor, in its capacity as the Holder of the Common Securities, unless the Depositor shall
have transferred the Common Securities as provided by
Section 5.11
, in which case this
provision shall refer instead to any such successor Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Holder of the Common Securities at
any time to dissolve the Trust and, after satisfaction of any liabilities of the Trust as
51
required by applicable law, to distribute the Notes to Holders in exchange for the Preferred
Securities (which direction is optional and wholly within the discretion of the Holder of the
Common Securities), provided, that the Holder of the Common Securities shall have received the
prior approval of the Federal Reserve if then required;
(c) the redemption of all of the Preferred Securities in connection with the payment at
maturity or redemption of all the Notes; and
(d) the entry of an order for dissolution of the Trust by a court of competent jurisdiction.
SECTION 9.3. Termination.
The respective obligations and responsibilities of the Trustees and the Trust shall terminate
upon the latest to occur of the following: (a) the distribution by the Property Trustee to Holders
of all amounts required to be distributed hereunder upon the liquidation of the Trust pursuant to
Section 9.4
, or upon the redemption of all of the Trust Securities pursuant to
Section
4.2
; (b) the satisfaction of any expenses owed by the Trust; and (c) the discharge of all
administrative duties of the Administrative Trustees, including the performance of any tax
reporting obligations with respect to the Trust or the Holders.
SECTION 9.4. Liquidation.
(a) If an Early Termination Event specified in
Section 9.2(a)
,
(b)
or
(d)
occurs or upon the Expiration Date, the Trust shall be liquidated by the Property
Trustee as expeditiously as the Property Trustee shall determine to be possible by distributing,
after satisfaction of liabilities to creditors of the Trust as provided by applicable law, to each
Holder a Like Amount of Notes, subject to
Section 9.4(d)
. Notice of liquidation shall be
given by the Property Trustee not less than thirty (30) nor more than sixty (60) days prior to the
Liquidation Date to each Holder of Trust Securities at such Holders address appearing in the
Securities Register. All such notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust Securities will no
longer be deemed to be Outstanding and (subject to
Section 9.4(d)
) any Securities
Certificates not surrendered for exchange will be deemed to represent a Like Amount of
Notes; and
(iii) provide such information with respect to the mechanics by which Holders may
exchange Securities Certificates for Notes, or if
Section 9.4(d)
applies, receive a
Liquidation Distribution, as the Property Trustee shall deem appropriate.
(b) Except where
Section 9.2(c)
or
9.4(d)
applies, in order to effect the
liquidation of the Trust and distribution of the Notes to Holders, the Property Trustee, either
itself acting as exchange agent or through the appointment of a separate exchange agent, shall
establish a record date for such distribution (which shall not be more than forty-five (45) days
prior to the Liquidation Date nor prior to the date on which notice of such liquidation is given to
the
52
Holders) and establish such procedures as it shall deem appropriate to effect the distribution
of Notes in exchange for the Outstanding Securities Certificates.
(c) Except where
Section 9.2(c)
or
9.4(d)
applies, after the Liquidation Date,
(i) the Trust Securities will no longer be deemed to be Outstanding, (ii) certificates representing
a Like Amount of Notes will be issued to Holders of Securities Certificates, upon surrender of such
Securities Certificates to the exchange agent for exchange, (iii) the Depositor shall use its best
efforts to have the Notes listed on the New York Stock Exchange or on such other exchange,
interdealer quotation system or self-regulatory organization on which the Preferred Securities are
then listed, if any, (iv) Securities Certificates not so surrendered for exchange will be deemed to
represent a Like Amount of Notes bearing accrued and unpaid interest in an amount equal to the
accumulated and unpaid Distributions on such Securities Certificates until such certificates are so
surrendered (and until such certificates are so surrendered, no payments of interest or principal
will be made to Holders of Securities Certificates with respect to such Notes) and (v) all rights
of Holders holding Trust Securities will cease, except the right of such Holders to receive Notes
upon surrender of Securities Certificates.
(d) Notwithstanding the other provisions of this
Section 9.4
, if distribution of the
Notes in the manner provided herein is determined by the Property Trustee not to be permitted or
practical, the Trust Property shall be liquidated, and the Trust shall be wound up by the Property
Trustee in such manner as the Property Trustee determines. In such event, Holders will be entitled
to receive out of the assets of the Trust available for distribution to Holders, after satisfaction
of liabilities to creditors of the Trust as provided by applicable law, an amount equal to the
Liquidation Amount per Trust Security plus accumulated and unpaid Distributions thereon to the date
of payment (such amount being the Liquidation Distribution). If, upon any such winding up the
Liquidation Distribution can be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then, subject to the next
succeeding sentence, the amounts payable by the Trust on the Trust Securities shall be paid on a
pro rata basis (based upon Liquidation Amounts). The Holder of the Common Securities will be
entitled to receive Liquidation Distributions upon any such winding up pro rata (based upon
Liquidation Amounts) with Holders of all Trust Securities, except that, if an Event of Default has
occurred and is continuing, the Preferred Securities shall have a priority over the Common
Securities as provided in
Section 4.3
.
SECTION 9.5. Mergers, Consolidations, Amalgamations or Replacements of Trust.
The Trust may not merge with or into, consolidate, amalgamate, or be replaced by, or convey,
transfer or lease its properties and assets substantially as an entirety to, any Person except
pursuant to this
Article IX
. At the request of the Holders of the Common Securities,
without the consent of the Holders of the Preferred Securities, the Trust may merge with or into,
consolidate, amalgamate, or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the laws of any State; provided,
that:
(a) such successor entity either (i) expressly assumes all of the obligations of the Trust
under this Trust Agreement with respect to the Preferred Securities or (ii) substitutes for the
Preferred Securities other securities having substantially the same terms as the Preferred
53
Securities (such other Securities, the Successor Securities) so long as the Successor
Securities have the same priority as the Preferred Securities with respect to distributions and
payments upon liquidation, redemption and otherwise;
(b) a trustee of such successor entity possessing substantially the same powers and duties as
the Property Trustee is appointed to hold the Notes;
(c) if the Preferred Securities or the Notes are rated, such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not cause the Preferred Securities or
the Notes (including any Successor Securities) to be downgraded by any nationally recognized
statistical rating organization that then assigns a rating to the Preferred Securities or the
Notes;
(d) the Preferred Securities are listed, or any Successor Securities will be listed upon
notice of issuance, on any national securities exchange or interdealer quotation system on which
the Preferred Securities are then listed, if any;
(e) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does
not adversely affect the rights, preferences and privileges of the Holders of the Preferred
Securities (including any Successor Securities) in any material respect;
(f) such successor entity has a purpose substantially identical to that of the Trust;
(g) prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease, the Depositor has received an Opinion of Counsel to the effect that (i) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect
the rights, preferences and privileges of the Holders of the Preferred Securities (including any
Successor Securities) in any material respect; (ii) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, neither the Trust nor such successor
entity will be required to register as an investment company under the Investment Company Act and
(iii) following such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease, the Trust (or the successor entity) will continue to be classified as a grantor trust for
U.S. federal income tax purposes; and
(h) the Depositor or its permitted transferee owns all of the common securities of such
successor entity and guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee Agreement.
Notwithstanding the foregoing, the Trust shall not, except with the consent of Holders of all of
the Preferred Securities, consolidate, amalgamate, merge with or into, or be replaced by or convey,
transfer or lease its properties and assets substantially as an entirety to any other Person or
permit any other entity to consolidate, amalgamate, merge with or into, or replace, the Trust if
such consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause
the Trust or the successor entity to be taxable as a corporation or classified as other than a
grantor trust for United States federal income tax purposes or cause the Notes to be treated as
other than indebtedness of the Depositor for United States federal income tax purposes.
54
ARTICLE X.
Information to Purchaser
SECTION 10.1. Depositor Obligations to Purchaser.
Notwithstanding any other provision herein, the Depositor shall furnish to (a) the Purchaser,
(b) any Owner of the Preferred Securities reasonably identified to the Depositor or the Trust
(which identification may be made either by such Owner or by the Placement Agent or Purchaser) and
(c) any designee of (a) or (b) above, copies of all correspondence, notices, forms, filings,
reports and other documents required to be provided by the Depositor, whether acting through an
Administrative Trustee or otherwise, to the Property Trustee or Delaware, Trustee under this Trust
Agreement.
SECTION 10.2. Trustees Obligations to Purchaser.
Notwithstanding any other provision herein, the Property Trustee shall furnish to (a) the
Purchaser, (b) the Placement Agent and (c) a designee of (a) or (b) above, copies of all (i)
correspondence, notices, forms, filings, reports and other documents required to be provided to the
Property Trustee or Delaware Trustee by the Depositor, whether acting through an Administrative
Trustee or otherwise, under this Trust Agreement, and (ii) correspondence, notices, forms, filings,
reports and other documents required to be provided to the Depositor or a Holder by the Property
Trustee or Delaware Trustee under this Trust Agreement.
ARTICLE XI.
Miscellaneous Provisions
SECTION 11.1. Limitation of Rights of Holders.
Except as set forth in
Section 9.2
, the death, bankruptcy, termination, dissolution or
incapacity of any Person having an interest, beneficial or otherwise, in Trust Securities shall not
operate to terminate this Trust Agreement, nor annul, dissolve or terminate the Trust nor entitle
the legal representatives or heirs of such Person or any Holder for such Person, to claim an
accounting, take any action or bring any proceeding in any court for a partition or winding up of
the arrangements contemplated hereby, nor otherwise affect the rights, obligations and liabilities
of the parties hereto or any of them.
SECTION 11.2. Agreed Tax Treatment of Trust and Trust Securities.
The parties hereto and, by its acceptance or acquisition of a Trust Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial interest in, such Trust
Security intend and agree to treat the Trust as a grantor trust for United States federal, state
and local tax purposes, and to treat the Trust Securities (including all payments and proceeds with
respect to such Trust Securities) as undivided beneficial ownership interests in the Trust Property
(and payments and proceeds therefrom, respectively) for United States federal, state and local tax
purposes. The provisions of this Trust Agreement shall be interpreted to further this intention
and agreement of the parties.
55
SECTION 11.3. Amendment.
(a) This Trust Agreement may be amended from time to time by the Property Trustee, the
Administrative Trustees and the Holder of all the Common Securities, without the consent of any
Holder of the Preferred Securities, (i) to cure any ambiguity, correct or supplement any provision
herein that may be defective or inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this Trust Agreement, which shall not
be inconsistent with the other provisions of this Trust Agreement, (ii) to modify, eliminate or add
to any provisions of this Trust Agreement to such extent as shall be necessary to ensure that the
Trust will neither be taxable as a corporation nor be classified as other than a grantor trust for
United States federal income tax purposes at all times that any Trust Securities are Outstanding or
to ensure that the Notes are treated as indebtedness of the Depositor for United States federal
income tax purposes, or to ensure that the Trust will not be required to register as an investment
company under the Investment Company Act or (iii) to add to the covenants, restrictions or
obligations of the Depositor; provided, that in the case of clauses (i), (ii) or (iii), such action
shall not adversely affect in any material respect the interests of any Holder.
(b) Except as provided in
Section 11.3(c)
, any provision of this Trust Agreement may
be amended by the Property Trustee, the Administrative Trustees and the Holder of all of the Common
Securities and with (i) the consent of Holders of at least a Majority in Liquidation Amount of the
Preferred Securities and (ii) receipt by the Trustees of an Opinion of Counsel to the effect that
such amendment or the exercise of any power granted to the Trustees in accordance with such
amendment will not cause the Trust to be taxable as a corporation or classified as other than a
grantor trust for United States federal income tax purposes or affect the treatment of the Notes as
indebtedness of the Depositor for United States federal income tax purposes or affect the Trusts
exemption from status (or from any requirement to register) as an investment company under the
Investment Company Act.
(c) Notwithstanding any other provision of this Trust Agreement, without the consent of each
Holder, this Trust Agreement may not be amended to (i) change the accrual rate, amount, currency or
timing of any Distribution on or the redemption price of the Trust Securities or otherwise
adversely affect the amount of any Distribution or other payment required to be made in respect of
the Trust Securities as of a specified date, (ii) restrict or impair the right of a Holder to
institute suit for the enforcement of any such payment on or after such date, (iii) reduce the
percentage of aggregate Liquidation Amount of Outstanding Preferred Securities, the consent of
whose Holders is required for any such amendment, or the consent of whose Holders is required for
any waiver of compliance with any provision of this Trust Agreement or of defaults hereunder and
their consequences provided for in this Trust Agreement; (iv) impair or adversely affect the rights
and interests of the Holders in the Trust Property, or permit the creation of any Lien on any
portion of the Trust Property; or (v) modify the definition of Outstanding, this
Section
11.3(c)
,
Sections 4.1
,
4.2
,
4.3
,
6.10(e)
or
Article IX
.
(d) Notwithstanding any other provision of this Trust Agreement, no Trustee shall enter into
or consent to any amendment to this Trust Agreement that would cause the Trust to be taxable as a
corporation or to be classified as other than a grantor trust for United States federal income tax
purposes or that would cause the Notes to fail or cease to be treated as indebtedness
56
of the Depositor for United States federal income tax purposes or that would cause the Trust
to fail or cease to qualify for the exemption from status (or from any requirement to register) as
an investment company under the Investment Company Act.
(e) If any amendment to this Trust Agreement is made, the Administrative Trustees or the
Property Trustee shall promptly provide to the Depositor a copy of such amendment.
(f) No Trustee shall be required to enter into any amendment to this Trust Agreement that
affects its own rights, duties or immunities under this Trust Agreement. The Trustees shall be
entitled to receive an Opinion of Counsel and an Officers Certificate stating that any amendment
to this Trust Agreement is in compliance with this Trust Agreement and all conditions precedent
herein provided for relating to such action have been met.
(g) No amendment or modification to this Trust Agreement that adversely affects in any
material respect the rights, duties, liabilities, indemnities or immunities of the Delaware Trustee
hereunder shall be permitted without the prior written consent of the Delaware Trustee.
SECTION 11.4. Separability.
If any provision in this Trust Agreement or in the Securities Certificates shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby, and there shall be deemed substituted for the
provision at issue a valid, legal and enforceable provision as similar as possible to the provision
at issue.
SECTION 11.5. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE HOLDERS, THE TRUST, THE
DEPOSITOR AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT
REFERENCE TO ITS CONFLICTS OF LAWS PROVISIONS.
SECTION 11.6. Successors.
This Trust Agreement shall be binding upon and shall inure to the benefit of any successor to
the Depositor, the Trust and any Trustee, including any successor by operation of law. Except in
connection with a transaction involving the Depositor that is permitted under
Article VIII
of the Indenture and pursuant to which the assignee agrees in writing to perform the Depositors
obligations hereunder, the Depositor shall not assign its obligations hereunder.
SECTION 11.7. Headings.
The Article and Section headings are for convenience only and shall not affect the
construction of this Trust Agreement.
57
SECTION 11.8. Reports, Notices and Demands.
(a) Any report, notice, demand or other communication that by any provision of this Trust
Agreement is required or permitted to be given or served to or upon any Holder or the Depositor may
be given or served in writing delivered in person, or by reputable, overnight courier, by telecopy
or by deposit thereof, first-class postage prepaid, in the United States mail, addressed, (a) in
the case of a Holder of Preferred Securities, to such Holder as such Holders name and address may
appear on the Securities Register; and (b) in the case of the Holder of all the Common Securities
or the Depositor, to Texas Capital Bancshares, Inc., 2100 McKinney Avenue, Suite 900, Dallas, Texas
75201, Attention: Chief Financial Officer, or to such other address as may be specified in a
written notice by the Holder of all the Common Securities or the Depositor, as the case may be, to
the Property Trustee. Such report, notice, demand or other communication to or upon a Holder or the
Depositor shall be deemed to have been given when received in person, within one (1) Business Day
following delivery by overnight courier, when telecopied with receipt confirmed, or within three
(3) Business Days following delivery by mail, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice was given, such
notice or other document shall be deemed to have been delivered on the date of such refusal or
inability to deliver.
(b) Any notice, demand or other communication that by any provision of this Trust Agreement is
required or permitted to be given or served to or upon the Property Trustee, the Delaware Trustee,
the Administrative Trustees, the Trust, the Placement Agent, or the Purchaser shall be given in
writing by deposit thereof, first-class postage prepaid, in the U.S. mail, personal delivery or
facsimile transmission, addressed to such Person as follows: (a) with respect to the Property
Trustee to Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington,
Delaware 19890-1600, Attention: Corporate Trust Administration, facsimile no. (302) 636-4140; (b)
with respect to the Delaware Trustee, to Wilmington Trust Company, Rodney Square North, 1100 North
Market Street, Wilmington, Delaware 19890-1600, Attention: Corporate Trust Administration,
facsimile no. (302) 636-4140; (c) with respect to the Administrative Trustees, to them at the
address above for notices to the Depositor, marked Attention: Administrative Trustees of Texas
Capital Statutory Trust V, (d) with respect to the Trust, to its principal executive office
specified in
Section 2.2
, with a copy to the Property Trustee, (e) with respect to the
Placement Agent, to SunTrust Capital Markets, Inc., 303 Peachtree Street, N.E., 24
th
Floor, Mail Code 3950, Atlanta, Georgia 30308, facsimile no. (404) 813-5000, and (f) with respect
to the Purchaser, to SunTrust Equity Funding, LLC, 303 Peachtree Street, NW, 26th Floor, Atlanta,
Georgia 30308, facsimile no. (404) 813-0000. Such notice, demand or other communication to or upon
the Trust, the Property Trustee or the Administrative Trustees shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the Trust, the Property
Trustee or the Administrative Trustees.
SECTION 11.9. Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the Holders that, until at
least one year and one day after the Trust has been terminated in accordance with
Article
IX
, they shall not file, or join in the filing of, a petition against the Trust under any
Bankruptcy Law or otherwise join in the commencement of any proceeding against the Trust under any
Bankruptcy Law. If the Depositor takes action in violation of this
Section 11.9
, the
Property
58
Trustee agrees, for the benefit of Holders, that at the expense of the Depositor, it shall
file an answer with the applicable bankruptcy court or otherwise properly contest the filing of
such petition by the Depositor against the Trust or the commencement of such action and raise the
defense that the Depositor has agreed in writing not to take such action and should be estopped and
precluded therefrom and such other defenses, if any, as counsel for the Property Trustee or the
Trust may assert.
This instrument may be executed in any number of counterparts, each of which so executed shall
be deemed to be an original, but all such counterparts shall together constitute but one and the
same instrument.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Trust Agreement
as of the day and year first above written.
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TEXAS CAPITAL BANCSHARES, INC.,
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as Depositor
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By:
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/s/ Peter Bartholow
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Name: Peter Bartholow
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Title: Chief Financial Officer
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WILMINGTON TRUST COMPANY, as
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WILMINGTON TRUST COMPANY, as Delaware
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Property Trustee
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Trustee
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By:
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/s/ Christopher J. Slaybaugh
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By:
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/s/ Christopher J. Slaybaugh
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Name: Christopher J. Slaybaugh
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Name: Christopher J. Slaybaugh
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Title: Senior Financial Services Officer
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Title: Senior Financial Services Officer
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/s/ Joseph M. Grant
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/s/ Peter Bartholow
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Name: Joseph M. Grant
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Name: Peter Bartholow
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Administrative Trustee
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Administrative Trustee
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Exhibit A
CERTIFICATE OF TRUST
OF
TEXAS CAPITAL STATUTORY TRUST V
This Certificate of Trust of Texas Capital Statutory Trust V (the Trust) is being duly
executed and filed on behalf of the Trust by the undersigned, as trustee, to form a statutory trust
under the Delaware Statutory Trust Act (12
Del
. C. §3801
et
seq
.) (the
Act).
1.
Name
. The name of the statutory trust formed by this Certificate of Trust is:
Texas Capital Statutory Trust V.
2.
Trustee
. The name and business address of the trustee of the Trust with its
principal place of business in the State of Delaware are Wilmington Trust Company, Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust
Administration.
3.
Effective Date
. This Certificate of Trust shall be effective upon its filing with
the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of Trust in accordance
with Section 3811(a)(1) of the Act.
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Wilmington Trust Company, not in its individual
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capacity, but solely as trustee
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By:
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Name:
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Title:
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A-1
Exhibit B
[FORM OF COMMON SECURITIES CERTIFICATE]
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS OR ANY OTHER APPLICABLE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM REGISTRATION. THIS CERTIFICATE IS
NOT TRANSFERABLE EXCEPT IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF THE TRUST AGREEMENT
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Certificate Number
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1,238 Common Securities
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C-
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Certificate Evidencing Common Securities
of
Texas Capital Statutory Trust V
Floating Rate Common Securities
(liquidation amount $1,000 per Common Security)
Texas Capital Statutory Trust V, a statutory trust created under the laws of the State of
Delaware (the Trust), hereby certifies that Texas Capital Bancshares, Inc. (the Holder) is the
registered owner of 1,238 common securities of the Trust representing undivided common beneficial
interests in the assets of the Trust and designated the Texas Capital Statutory Trust V Floating
Rate Common Securities (liquidation amount $1,000 per Common Security) (the Common Securities).
Except in accordance with
Section 5.11
of the Trust Agreement (as defined below), the
Common Securities are not transferable and, to the fullest extent permitted by law, any attempted
transfer hereof other than in accordance therewith shall be void. The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the Common Securities are
set forth in, and this certificate and the Common Securities represented hereby are issued and
shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust
Agreement of the Trust, dated as of September 29, 2006, as the same may be amended from time to
time (the Trust Agreement), among Texas Capital Bancshares, Inc., as Depositor, Wilmington Trust
Company, as Property Trustee, Wilmington Trust Company, as Delaware Trustee, the Administrative
Trustees named therein and the Holders, from time to time, of Trust Securities. The Trust will
furnish a copy of the Trust Agreement to the Holder without charge upon written request to the
Trust at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled
to the benefits thereunder.
B-1
This Common Securities Certificate shall be governed by and construed in accordance with the
laws of the State of Delaware.
Terms used but not defined herein have the meanings set forth in the Trust Agreement.
In Witness Whereof
, one of the Administrative Trustees of the Trust has executed on
behalf of the Trust this certificate this 29th day of September, 2006.
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Texas Capital Statutory Trust V
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By:
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Name: Peter Bartholow
Administrative Trustee
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B-2
Exhibit C
[FORM OF PREFERRED SECURITIES CERTIFICATE]
THIS PREFERRED SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE TRUST AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (DTC) OR A
NOMINEE OF DTC. THIS PREFERRED SECURITY IS EXCHANGEABLE FOR PREFERRED SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
TRUST AGREEMENT, AND NO TRANSFER OF THIS PREFERRED SECURITY (OTHER THAN A TRANSFER OF THIS
PREFERRED SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC OR BY A NOMINEE OF DTC TO DTC OR ANOTHER
NOMINEE OF DTC) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS PREFERRED SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO TEXAS
CAPITAL STATUTORY TRUST V OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
PREFERRED SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES
ACT), AND SUCH PREFERRED SECURITIES OR ANY INTEREST THEREIN MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF ANY PREFERRED SECURITIES IS HEREBY NOTIFIED THAT THE SELLER OF THE PREFERRED
SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A UNDER THE SECURITIES ACT.
THE HOLDER OF THE PREFERRED SECURITIES REPRESENTED BY THIS CERTIFICATE AGREES FOR THE BENEFIT
OF THE TRUST AND THE DEPOSITOR THAT (A) SUCH PREFERRED SECURITIES MAY BE OFFERED, RESOLD OR
OTHERWISE TRANSFERRED ONLY (I) TO THE TRUST OR THE DEPOSITOR, (II) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) TO AN INSTITUTIONAL
ACCREDITED INVESTOR WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
C-1
ACCOUNT OF AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (IV)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (V) PURSUANT TO AN
EXEMPTION FROM THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND, IN THE CASE OF (III) OR
(V), SUBJECT TO THE RIGHT OF THE TRUST AND THE DEPOSITOR TO REQUIRE AN OPINION OF COUNSEL AND OTHER
INFORMATION SATISFACTORY TO EACH OF THEM AND (B) THE HOLDER WILL NOTIFY ANY PURCHASER OF ANY
PREFERRED SECURITIES FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
THE PREFERRED SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN
AGGREGATE LIQUIDATION AMOUNT OF NOT LESS THAN $100,000. TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY ATTEMPTED TRANSFER OF PREFERRED SECURITIES OR ANY INTEREST THEREIN IN A BLOCK HAVING AN
AGGREGATE LIQUIDATION AMOUNT OF LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF SHALL
BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH PREFERRED SECURITIES FOR
ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF THE LIQUIDATION AMOUNT OF OR
DISTRIBUTIONS ON SUCH PREFERRED SECURITIES OR ANY INTEREST THEREIN, AND SUCH PURPORTED TRANSFEREE
SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH PREFERRED SECURITIES.
THE HOLDER OF THIS SECURITY OR ANY INTEREST THEREIN BY ITS ACCEPTANCE HEREOF OR THEREOF ALSO
AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT
OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED (ERISA), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
CODE) (EACH A PLAN), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF
ANY PLANS INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING PLAN ASSETS OF ANY PLAN MAY ACQUIRE
OR HOLD THIS PREFERRED SECURITY OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS
ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION
CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE
AND HOLDING OF THIS SECURITY OR ANY INTEREST THEREIN IS NOT PROHIBITED BY SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THE
PREFERRED SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND
HOLDING THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF SECTION
3(3) OF ERISA, OR A PLAN TO WHICH SECTION
C-2
4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE
BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN
OR PLAN TO FINANCE SUCH PURCHASE, OR (ii) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED
TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE
STATUTORY OR ADMINISTRATIVE EXEMPTION.
THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND
OF THE UNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE FDIC).
C-3
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Certificate Number
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40,000 Preferred Securities
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$40,000,000 Aggregate Liquidation Amount
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CUSIP NO.
88224N AA 2
Certificate Evidencing Preferred Securities
of
Texas Capital Statutory Trust V
Floating Rate Preferred Securities
(liquidation amount $1,000 per Preferred Security)
Texas Capital Statutory Trust V, a statutory trust created under the laws of the State of
Delaware (the Trust), hereby certifies that Cede & Co. (the Holder) is the registered owner of
40,000 Preferred Securities, or such other number of Preferred Securities represented hereby as may
be set forth in the records of the Securities Registrar hereinafter referred to in accordance with
the Trust Agreement (as defined below),] of the Trust representing an undivided preferred
beneficial interest in the assets of the Trust and designated the Texas Capital Statutory Trust V
Floating Rate Preferred Securities (liquidation amount $1,000 per Preferred Security) (the
Preferred Securities). The Preferred Securities are transferable on the books and records of the
Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer as provided in
Section 5.7
of the Trust Agreement (as
defined below). The designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities are set forth in, and this certificate and the Preferred
Securities represented hereby are issued and shall in all respects be subject to the terms and
provisions of, the Amended and Restated Trust Agreement of the Trust, dated as of September 29,
2006, as the same may be amended from time to time (the Trust Agreement), among Texas Capital
Bancshares, Inc., a Delaware corporation, as Depositor, Wilmington Trust Company, as Property
Trustee, Wilmington Trust Company, as Delaware Trustee, the Administrative Trustees named therein
and the Holders, from time to time, of Trust Securities. The Holder is entitled to the benefits of
the Guarantee Agreement entered into by Texas Capital Bancshares, Inc. and Wilmington Trust
Company, as Guarantee Trustee, dated as of September 29, 2006, as the same may be amended from time
to time (the Guarantee Agreement), to the extent provided therein. The Trust will furnish a copy
of each of the Trust Agreement and the Guarantee Agreement to the Holder without charge upon
written request to the Property Trustee at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled
to the benefits thereunder.
C-4
This Preferred Securities Certificate shall be governed by and construed in accordance with
the laws of the State of Delaware.
All capitalized terms used but not defined in this Preferred Securities Certificate are used
with the meanings specified in the Trust Agreement, including the Schedules and Exhibits thereto.
In Witness Whereof
, one of the Administrative Trustees of the Trust has executed on
behalf of the Trust this certificate this 29th day of September, 2006.
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Texas Capital Statutory Trust V
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By:
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Name: Peter Bartholow
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Administrative Trustee
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This is one of the Preferred Securities referred to in the within-mentioned Trust Agreement.
Dated: September 29, 2006
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Wilmington Trust Company, not in its individual
capacity, but solely as Property Trustee
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By:
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Authorized officer
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C-5
[FORM OF REVERSE OF SECURITY]
The Trust promises to pay Distributions from September 29, 2006, or from the most recent
Distribution Date to which Distributions have been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on December 31, 2006, at an annual rate equal to 7.076880% beginning on (and
including) the date of original issuance and ending on (but excluding) December 31, 2006 and for
each successive period beginning on (and including) December 31, 2006, and each successive
Distribution Date, at a variable rate per annum, reset quarterly, and ending on (but excluding) the
next succeeding Distribution Date equal to LIBOR plus 1.71% of the Liquidation Amount of the
Preferred Securities represented by this Preferred Securities Certificate, together with any
Additional Interest Amounts, in respect to such period.
Distributions on the Trust Securities shall be made by the Paying Agent from the Payment
Account and shall be payable on each Distribution Date only to the extent that the Trust has funds
then on hand and available in the Payment Account for the payment of such Distributions.
In the event (and to the extent) that the Depositor exercises its right under the Indenture to
defer the payment of interest on the Notes, Distributions on the Preferred Securities shall be
deferred.
Under the Indenture, so long as no Note Event of Default pursuant to paragraphs (c), (e) or
(f) of
Section 5.1
of the Indenture has occurred and is continuing, the Depositor shall
have the right, at any time and from time to time during the term of the Notes, to defer the
payment of interest on the Notes for a period of up to twenty (20) consecutive quarterly interest
payment periods (each such extended interest payment period, an Extension Period), during which
Extension Period no interest shall be due and payable (except any Additional Tax Sums that may be
due and payable). No interest on the Notes shall be due and payable during an Extension Period,
except at the end thereof, but each installment of interest that would otherwise have been due and
payable during such Extension Period shall bear Additional Interest (to the extent payment of such
interest would be legally enforceable) at a variable rate per annum, reset quarterly, equal to
LIBOR plus 1.71%, compounded quarterly, from the dates on which amounts would have otherwise been
due and payable until paid or until funds for the payment thereof have been made available for
payment. If Distributions are deferred, the deferred Distributions (including Additional Interest
Amounts) shall be paid on the date that the related Extension Period terminates to Holders (as
defined in the Trust Agreement) of the Trust Securities as they appear on the books and records of
the Trust on the record date immediately preceding such termination date.
Distributions on the Securities must be paid on the dates payable (after giving effect to any
Extension Period) to the extent that the Trust has funds available for the payment of such
Distributions in the Payment Account of the Trust. The Trusts funds available for Distribution to
the Holders of the Preferred Securities will be limited to payments received from the Depositor.
The payment of Distributions out of moneys held by the Trust is guaranteed by the Depositor
pursuant to the Guarantee Agreement.
C-6
During any such Extension Period, the Depositor shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any
of the Depositors capital stock or (ii) make any payment of principal of or any interest or
premium on or repay, repurchase or redeem any debt securities of the Depositor that rank pari passu
in all respects with or junior in interest to the Notes (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Depositor in connection with (1) any
employment contract, benefit plan or other similar arrangement with or for the benefit of any one
or more employees, officers, directors or consultants, (2) a dividend reinvestment or stockholder
stock purchase plan or (3) the issuance of capital stock of the Depositor (or securities
convertible into or exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a result of a
reclassification of the Guarantors capital stock or the exchange or conversion of any class or
series of the Depositors capital stock (or any capital stock of a Subsidiary (as defined in the
Indenture) of the Depositor) for any class or series of the Depositors capital stock or of any
class or series of the Depositors indebtedness for any class or series of the Depositors capital
stock, (c) the purchase of fractional interests in shares of the Depositors capital stock pursuant
to the conversion or exchange provisions of such capital stock or the security being converted or
exchanged, (d) any declaration of a dividend or distribution in connection with any Rights Plan (as
defined in the Indenture), the issuance of rights, stock or other property under any Rights Plan,
or the redemption or repurchase of rights pursuant thereto or (e) any dividend or distribution in
the form of stock, warrants, options or other rights where the dividend or distribution stock or
the stock issuable upon exercise of such warrants, options or other rights is the same stock as
that on which the dividend or distribution is being paid or ranks pari passu with or junior to such
stock).
On each Note Redemption Date, on the stated maturity (or any date of principal repayment upon
early maturity) of the Notes and on each other date on (or in respect of) which any principal on
the Notes is repaid, the Trust will be required to redeem a Like Amount of Trust Securities at the
Redemption Price. Under the Indenture, the Notes may be redeemed by the Depositor on any Interest
Payment Date, at the Depositors option, on or after December 31, 2011 in whole or in part from
time to time at a redemption price equal to one hundred percent (100%) of the principal amount
thereof or the redeemed portion thereof, as applicable, together, in the case of any such
redemption, with accrued interest, including any Additional Interest, to but excluding the date
fixed for redemption; provided, that the Depositor shall have received the prior approval of the
Federal Reserve if then required. The Notes may also be redeemed by the Depositor, at its option,
at any time, in whole but not in part, upon the occurrence of a Capital Disqualification Event, an
Investment Company Event or a Tax Event at the Special Event Redemption Price.
The Trust Securities redeemed on each Redemption Date shall be redeemed at the Redemption
Price with the proceeds from the contemporaneous redemption or payment at maturity of Notes.
Redemptions of the Trust Securities (or portion thereof) shall be made and the Redemption Price
shall be payable on each Redemption Date only to the extent that the Trust has funds then on hand
and available in the Payment Account for the payment of such Redemption Price.
C-7
Payments of Distributions (including any Additional Interest Amounts), the Redemption Price,
Liquidation Amount or any other amounts in respect of the Preferred Securities shall be made by
wire transfer at such place and to such account at a banking institution in the United States as
may be designated in writing at least ten (10) Business Days prior to the date for payment by the
Person entitled thereto unless proper written transfer instructions have not been received by the
relevant record date, in which case such payments shall be made by check mailed to the address of
such Person as such address shall appear in the Security Register. If any Preferred Securities are
held by a Depositary, such Distributions shall be made to the Depositary in immediately available
funds.
The indebtedness evidenced by the Notes is, to the extent provided in the Indenture,
subordinate and junior in right of payment to the prior payment in full of all Senior Debt (as
defined in the Indenture), and this Security is issued subject to the provisions of the Indenture
with respect thereto.
C-8
ASSIGNMENT
For Value Received
, the undersigned assigns and transfers this Preferred Securities
Certificate to:
(Insert assignees social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to transfer this Preferred Securities Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
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Date:
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Signature:
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(Sign exactly as your name appears on the other side of this Preferred Securities Certificate)
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The signature(s) should be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in an approved
signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.
C-9
Exhibit D
Junior Subordinated Indenture
D-1
Exhibit E
FORM OF TRANSFEREE CERTIFICATE
TO BE EXECUTED BY TRANSFEREES OTHER THAN QIBS
__________, [ ]
Texas Capital Bancshares, Inc.
Texas Capital Statutory Trust V
2100 McKinney Avenue
Suite 900
Dallas, Texas 75201
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Re:
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Purchase of $1,000 stated liquidation amount of Floating Rate Preferred Securities
(the Preferred Securities) of Texas Capital Statutory Trust V
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Ladies and Gentlemen:
In connection with our purchase of the Preferred Securities we confirm that:
1. We understand that the Floating Rate Preferred Securities (the Preferred Securities) of
Texas Capital Statutory Trust V (the Trust) (including the guarantee (the Guarantee) of Texas
Capital Bancshares, Inc. (the Company) executed in connection therewith) and the Floating Rate
Junior Subordinated Notes due 2036 of the Company (the Subordinated Notes) (the Preferred
Securities, the Guarantee and the Subordinated Notes together being referred to herein as the
Offered Securities), have not been registered under the Securities Act of 1933, as amended (the
Securities Act), and may not be offered or sold except as permitted in the following sentence. We
agree on our own behalf and on behalf of any investor account for which we are purchasing the
Offered Securities that, if we decide to offer, sell or otherwise transfer any such Offered
Securities, (i) such offer, sale or transfer will be made only (a) to the Trust or the Company, (b)
to a person we reasonably believe is a qualified institutional buyer (a QIB) (as defined in
Rule 144A under the Securities Act) in a transaction meeting the requirements of Rule 144A, (c) to
an institutional accredited investor within the meaning of subparagraph (a) (1), (2), (3) or (7)
of Rule 501 under the Securities Act that is acquiring Offered Securities for its own account, or
for the account of such an accredited investor, for investment purposes and not with a view to,
or for offer or sale in connection with, any distribution thereof in violation of the Securities
Act, (d) pursuant to an effective registration statement under the Securities Act, or (e) pursuant
to an exemption from the Securities Act, in each case in accordance with any applicable securities
laws of any state of the United States or any other applicable jurisdiction and, in the case of (c)
or (e), subject to the right of the Trust and the Company to require an opinion of counsel and
other information satisfactory to each of them. The foregoing restrictions on resale will not apply
subsequent to the date on which, in the written opinion of counsel, the Preferred Securities are
not restricted securities within the meaning of Rule 144 under the Securities Act. If any resale
or other transfer of the Offered Securities is proposed to be made pursuant to clause (c) or (e)
above, the transferor shall deliver a letter from the transferee substantially in the form of this
letter to the Company and the Property Trustee as Transfer Agent, which shall provide as
applicable, among other things, that the transferee is an accredited investor within the meaning
of subparagraph (a) (1), (2), (3) or (7) of Rule 501
E-1
under the Securities Act that is acquiring such Securities for investment purposes and not for
distribution in violation of the Securities Act. We acknowledge on our behalf and on behalf of any
investor account for which we are purchasing Securities that the Trust and the Company reserve the
right prior to any offer, sale or other transfer pursuant to clause (c) or (e) to require the
delivery of any opinion of counsel, certifications and/or other information satisfactory to the
Trust and the Company. We understand that the certificates for any Offered Security that we
receive will bear a legend substantially to the effect of the foregoing.
2. We are an accredited investor within the meaning of subparagraph (a) (1), (2), (3) or (7)
of Rule 501 under the Securities Act purchasing for our own account or for the account of such an
accredited investor, and we are acquiring the Offered Securities for investment purposes and not
with view to, or for offer or sale in connection with, any distribution in violation of the
Securities Act, and we have such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of our investment in the Offered Securities, and we
and any account for which we are acting are each able to bear the economic risks of our or its
investment.
3. We are acquiring the Offered Securities purchased by us for our own account (or for one or
more accounts as to each of which we exercise sole investment discretion and have authority to
make, and do make, the statements contained in this letter) and not with a view to any distribution
of the Offered Securities, subject, nevertheless, to the understanding that the disposition of our
property will at all times be and remain within our control.
4. In the event that we purchase any Preferred Securities or any Subordinated Notes, we will
acquire such Preferred Securities having an aggregate stated liquidation amount of not less than
$100,000 or such Subordinated Notes having an aggregate principal amount not less than $100,000,
for our own account and for each separate account for which we are acting.
5. We acknowledge that we either (A) are not a fiduciary of a employee benefit, individual
retirement account or other plan or arrangement subject to Title I of the Employee Retirement
Income Security Act of 1974, as amended (ERISA), or Section 4975 of the Internal Revenue Code of
1986, as amended (the Code) (each a Plan), or an entity whose underlying assets include plan
assets by reason of any Plans investment in the entity, and are not purchasing the Offered
Securities on behalf of or with plan assets by reason of any Plans investment in the entity, (B)
are eligible for the exemptive relief available under one or more of the following prohibited
transaction class exemptions (PTCEs) issued by the U.S. Department of Labor: PTCE 96-23, 95-60,
91-38, 90-1 or 84-14 or another applicable exemption, or (C) our purchase and holding of this
security, or any interest therein, is not prohibited by Section 406 of ERISA or Section 4975 of the
Code with respect to such purchase or holding.
6. We acknowledge that the Trust and the Company and others will rely upon the truth and
accuracy of the foregoing acknowledgments, representations, warranties and agreements and agree
that if any of the acknowledgments, representations, warranties and agreements deemed to have been
made by our purchase of the Offered Securities are no longer accurate, we shall promptly notify the
Company. If we are acquiring any Offered Securities as a fiduciary or agent for one or more
investor accounts, we represent that we have sole discretion
E-2
with respect to each such investor account and that we have full power to make the foregoing
acknowledgments, representations and agreement on behalf of each such investor account.
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(Name of Purchaser)
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By:
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Date:
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Upon transfer, the Offered Securities would be registered in the name of the new beneficial
owner as follows.
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Name:
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Address:
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Taxpayer ID Number:
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E-3
Exhibit F
FORM OF TRANSFEROR CERTIFICATE
TO BE EXECUTED FOR QIBs
__________, [ ]
Texas Capital Bancshares, Inc.
Texas Capital Statutory Trust V
2100 McKinney Avenue
Suite 900
Dallas, Texas 75201
Re: Purchase of a minimum aggregate of $100,000 stated liquidation amount of Floating Rate
Preferred Securities (the Preferred Securities) of Texas Capital Statutory Trust V
Reference is hereby made to the Amended and Restated Trust Agreement of Texas Capital
Statutory Trust V, dated as of September 29, 2006 (the Trust Agreement), among Joseph M. Grant
and Peter Bartholow, as Administrative Trustees, Wilmington Trust Company, as Delaware Trustee,
Wilmington Trust Company, as Property Trustee, Texas Capital Bancshares, Inc., as Depositor, and
the holders from time to time of undivided beneficial interests in the assets of Texas Capital
Statutory Trust V. Capitalized terms used but not defined herein shall have the meanings given
them in the Trust Agreement.
This letter relates to $
aggregate liquidation amount of Preferred
Securities which are held in the name of
(the Transferor).
In accordance with Article V of the Trust Agreement, the Transferor hereby certifies that such
Preferred Securities are being transferred in accordance with (i) the transfer restrictions set
forth in the Preferred Securities and (ii) Rule 144A under the Securities Act (Rule 144A), to a
transferee that the Transferor reasonably believes is purchasing the Preferred Securities for its
own account or an account with respect to which the transferee exercises sole investment discretion
and the transferee and any such account is a qualified institutional buyer within the meaning of
Rule 144A, in a transaction meeting the requirements of Rule 144A and in accordance with applicable
securities laws of any state of the United States or any other jurisdiction.
You are entitled to rely upon this letter and are irrevocably authorized to produce this
letter or a copy hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
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(Name of Transferor)
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By:
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Name:
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Title:
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Date:
F-1
Exhibit G
Officers Certificate
The undersigned, the [Chief Financial Officer] [Treasurer] [Executive Vice President] hereby
certifies, pursuant to Section 8.16(b) of the Amended and Restated Trust Agreement, dated as of
September 29, 2006, among Texas Capital Bancshares, Inc. (the Company), Wilmington Trust Company,
as property trustee, Wilmington Trust Company, as Delaware trustee and the administrative trustees
named therein, that, as of [date], [20___], the Company had the following ratios and balances:
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BANK HOLDING COMPANY
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As of [Quarterly Financial Dates]
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Tier 1 Risk Weighted Assets
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%
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Ratio of Double Leverage
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%
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Non-Performing Assets to Loans and OREO
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%
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Tangible Common Equity as a Percentage of Tangible Assets
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%
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Ratio of Reserves to Non-Performing Loans
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%
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Ratio of Net Charge-Offs to Loans
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%
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Return on Average Assets (annualized)
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%
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Net Interest Margin (annualized)
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%
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Efficiency Ratio
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%
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Ratio of Loans to Assets
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%
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Ratio of Loans to Deposits
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%
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Total Assets
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$
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Year to Date Income
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$
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*
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A table describing the quarterly report calculation procedures is provided on page ___
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[
FOR FISCAL YEAR END:
Attached hereto are the audited consolidated financial statements
(including the balance sheet, income statement and statement of cash flows, and notes thereto,
together with the report of the independent accountants thereon) of the Company and its
consolidated subsidiaries for the three years ended ___, 20___.]
[
FOR FISCAL QUARTER END:
Attached hereto are the unaudited consolidated and consolidating financial
statements (including the balance sheet and income statement) of the Company and its consolidated
subsidiaries for the fiscal quarter] ended [date], 20___.
G-1
The financial statements fairly present in all material respects, in accordance with U.S. generally
accepted accounting principles (GAAP), the financial position of the Company and its consolidated
subsidiaries, and the results of operations and changes in financial condition as of the date, and
for the [___quarter interim] [annual] period ended [date], 20___, and such financial statements
have been prepared in accordance with GAAP consistently applied throughout the period involved
(expect as otherwise noted therein).
IN WITNESS WHEREOF, the undersigned has executed this Officers Certificate as of this ___
day of ___, 20___
Name:
Title:
Texas Capital Bancshares, Inc.
2100 McKinney Avenue
Suite 900
Dallas, Texas 75201
(214) 932-6775
G-2
Financial Definitions
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Corresponding FRY-9C or LP Line Items with
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Description of
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Report Item
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Line Item corresponding Schedules
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Calculation
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Tier 1 Risk
Weighted Assets
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BHCK7206
Schedule HC-R
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Tier 1 Risk Ratio: Core Capital (Tier 1)/Risk-Adjusted Assets
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Ratio of Double
Leverage
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(BHCP0365)/(BCHCP3210)
Schedule PC in the LP
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Total equity investments
in subsidiaries divided
by the total equity
capital. This field is
calculated at the parent
company level.
Subsidiaries include
bank, bank holding
company, and non-bank
subsidiaries.
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Non-Performing
Assets to Loans and
OREO
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(BHCK5525-BHCK3506+BHCK5526-BHCK
3507+BHCK2744)/(BHCK2122+BHCK2744)
Schedules HC-C, HC-M & HC-N
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Total Nonperforming
Assets (NPLs+Foreclosed
Real Estate+Other
Nonaccrual & Repossessed
Assets)/Total
Loans+Foreclosed Real
Estate
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Tangible Common
Equity as a
Percentage of
Tangible Assets
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(BHDM3210-BHCK3163)/(BHCK2170-BH
CK3163)
Schedule HC
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(Equity Capital
Goodwill)/(Total Assets
Goodwill)
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Ratio of Reserves
to Non-Performing
Loans
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(BHCK3123+BHCK3128)/(BHCK5525-BH
CK3506+BHCK5526-BHCK3507)
Schedules HC & HC-N & HC-R
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Total Loan Loss and
Allocated Transfer Risk
Reserves/ Total
Nonperforming Loans
(Nonaccrual +
Restructured)
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Ratio of Net
Charge-Offs to
Loans
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(BHCK4635-BHCK4605)/(BHCK3516)
Schedules HC-B &
HC-K
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Net charge offs for the
period as a percentage of
average loans.
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Return on Average
Assets (annualized)
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(BHCK4340/BHCK3368)
Schedules HI & HC-K
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Net Income as a
percentage of Assets.
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Net Interest Margin
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(BHCK4519)/(BHCK3515+BHCK3365+BH
CK3516+BHCK3401+BHCKB985)
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(Net Interest Income Fully Taxable
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G-3
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Corresponding FRY-9C or LP Line Items with
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Description of
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Report Item
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Line Item corresponding Schedules
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Calculation
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(annualized)
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Schedules HI Memorandum and HC-K
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Equivalent, if available/Average Earning Assets)
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Efficiency Ratio
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(BHCK4093)/(BHCK4519+BHCK4079)
Schedule HI
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(Non-interest
Expense)/(Net Interest
Income Fully Taxable
Equivalent, if available,
plus Non-interest Income)
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Ratio of Loans to
Assets
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(BHCKB528+BHCK5369)/(BHCK2170)
Schedule HC
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Total Loans & Leases (Net
of Unearned Income &
Gross of Reserve)/Total
Assets
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Ratio of Loans to
Deposits
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(BHCKB528+BHCK5369)/(BHDM6631+BH
DM6636+BHFN6631+BHFN6636)
Schedule HC
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Total Loans & Leases (Net
of Unearned Income &
Gross of Reserve)/Total
Deposits (Includes
Domestic and Foreign
Deposits)
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Total Assets
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(BHCK2170)
Schedule HC
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The sum of total assets.
Includes cash and
balances due from
depository institutions;
securities; federal funds
sold and securities
purchased under
agreements to resell;
loans and lease financing
receivables; trading
assets; premises and
fixed assets; other real
estate owned; investments
in unconsolidated
subsidiaries and
associated companies;
customers liability on
acceptances outstanding;
intangible assets; and
other assets.
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Net Income
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(BHCK4300)
Schedule HI
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The sum of income
(loss)before
extraordinary items and
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G-4
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Corresponding FRY-9C or LP Line Items with
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Description of
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Report Item
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Line Item corresponding Schedules
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Calculation
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other adjustments and
extraordinary items; and
other adjustments, net of
income taxes.
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G-5
Financial Definitions
THRIFT HOLDING COMPANY
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Description of
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Report Item
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Corresponding TFR
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Calculation
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Tier I Risk
Weighted Assets
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Schedule CCR Consolidated
Capital Requirement
CCR 830
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Tier 1 Risk Ratio: Core
Capital (Tier
1)/Risk-adjusted assets
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Ratio of Double
Leverage
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Not applicable
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Not applicable
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Non-performing
assets to loans and
OREO
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Schedule PD Consolidated
Past Due and Nonaccrual
Schedule SC Consolidated
Statement of Condition
PD30/(SC23+SC30+SC34+SC40)
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Total Non-performing
assets (NPLs +
Foreclosed Real
Estate+Other
Non-accrual &
Repossessed
assets+Foreclosed Real
Estate)
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Tangible Common
Equity as a
Percentage of Total
Assets
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Schedule CCR
CCR 840
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(Equity
Capital-Goodwill) /
(Total assets
Goodwill)
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Ratio of Reserves
to Non-performing
loans
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SC283/PD30
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Total loan loss
reserves / Total
Non-performing loans
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Ratio of Net
Charge-offs to
Loans
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Schedule VA Consolidated
Valuation Allowances and
Related Data
(VA155-VA135)/(SC23+SC30+SC34)
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Net charge offs for the
period as a percentage
of average loans
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Return on Assets
(annualized)
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Schedule SO Consolidated
Statements of Operations
SO91/SC60
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Net income as a
percentage of assets
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Net interest margin
(annualized)
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SO311/((SC10-SC110)+SC20+SC23+
SC30+SC34)
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Net interest income /Average
earning assets
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Efficiency Ratio
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(SO51/(SO311+SO40))
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(Non-interest expense)
/ (Net interest income
+ Non-interest income)
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Ratio of Loans to
Assets
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(SC23+SC30+SC34)/(SC60)
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Total Loan & Leases /Total
assets
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Ratio of Loans to
Deposits
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(SC23+SC30+SC34)/(SC710)
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Total Loans & Leases /Total
Deposits
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Total Assets
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Schedule SC
SC60
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The sum of total assets.
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Net Income
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Schedule SO
SO91
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The sum of income
(loss).
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G-6
Schedule A
DETERMINATION OF LIBOR
With respect to the Trust Securities, the London interbank offered rate (LIBOR) shall be
determined by the Calculation Agent in accordance with the following provisions (in each case
rounded to the nearest .000001%):
(1) On the second LIBOR Business Day (as defined below) prior to a Distribution Date (except, with
respect to the first distribution payment period, on September 27, 2006) (each such day, a LIBOR
Determination Date), LIBOR for any given security shall, for the following distribution period,
equal the rate, as obtained by the Calculation Agent from Bloomberg Financial Markets Commodities
News, for three-month U.S. Dollar deposits in Europe, which appears on Dow Jones Telerate Page 3750
(as defined in the International Swaps and Derivatives Association, Inc. 1991 Interest Rate and
Currency Exchange Definitions), or such other page as may replace such Page 3750, as of 11:00 a.m.
(London time) on such LIBOR Determination Date.
(2) If, on any LIBOR Determination Date, such rate does not appear on Dow Jones Telerate Page 3750
or such other page as may replace such Page 3750, the Calculation Agent shall determine the
arithmetic mean of the offered quotations of the Reference Banks (as defined below) to leading
banks in the London interbank market for three-month U.S. Dollar deposits in Europe in an amount
determined by the Calculation Agent by reference to requests for quotations as of approximately
11:00 a.m. (London time) on the LIBOR Determination Date made by the Calculation Agent to the
Reference Banks. If, on any LIBOR Determination Date, at least two of the Reference Banks provide
such quotations, LIBOR shall equal such arithmetic mean of such quotations. If, on any LIBOR
Determination Date, only one or none of the Reference Banks provide such quotations, LIBOR shall be
deemed to be the arithmetic mean of the offered quotations that leading banks in the City of New
York selected by the Calculation Agent are quoting on the relevant LIBOR Determination Date for
three-month U.S. Dollar deposits in Europe in an amount determined by the Calculation Agent by
reference to the principal London offices of leading banks in the London interbank market;
provided, that if the Calculation Agent is required but is unable to determine a rate in accordance
with at least one of the procedures provided above, LIBOR shall be LIBOR as determined on the
previous LIBOR Determination Date.
(3) As used herein: Reference Banks means four major banks in the London interbank market
selected by the Calculation Agent; and LIBOR Business Day means a day on which commercial banks
are open for business (including dealings in foreign exchange and foreign currency deposits) in
London.
Schedule A-1
JUNIOR SUBORDINATED INDENTURE
between
TEXAS CAPITAL BANCSHARES, INC.
and
WILMINGTON TRUST COMPANY,
as Trustee
Dated as of September 29, 2006
TABLE OF CONTENTS
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Page
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ARTICLE I Definitions and Other Provisions of General Application
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1
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SECTION 1.1. Definitions
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1
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SECTION 1.2. Compliance Certificate and Opinions
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10
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SECTION 1.3. Forms of Documents Delivered to Trustee
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11
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SECTION 1.4. Acts of Holders
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11
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SECTION 1.5.
Notices, Etc.
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13
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SECTION 1.6. Notice to Holders; Waiver
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14
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SECTION 1.7. Effect of Headings and Table of Contents
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14
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SECTION 1.8. Successors and Assigns
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14
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SECTION 1.9. Separability Clause
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14
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SECTION 1.10. Benefits of Indenture
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15
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SECTION 1.11. Governing Law
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15
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SECTION 1.12. Submission to Jurisdiction
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15
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SECTION 1.13. Non-Business Days
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15
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ARTICLE II Security Forms
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15
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SECTION 2.1. Form of Security
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15
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SECTION 2.2. Restrictive Legend
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21
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SECTION 2.3. Form of Trustees Certificate of Authentication
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23
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SECTION 2.4. Temporary Securities
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23
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SECTION 2.5. Definitive Securities
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24
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ARTICLE III The Securities
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24
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SECTION 3.1. Payment of Principal and Interest
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24
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SECTION 3.2. Denominations
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26
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SECTION 3.3. Execution, Authentication, Delivery and Dating
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26
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SECTION 3.4. Global Securities
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27
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SECTION 3.5. Registration, Transfer and Exchange Generally
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29
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SECTION 3.6. Mutilated, Destroyed, Lost and Stolen Securities
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30
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SECTION 3.7. Persons Deemed Owners
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30
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SECTION 3.8. Cancellation
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31
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SECTION 3.9. Deferrals of Interest Payment Dates
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31
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SECTION 3.10. Right of Set-Off
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32
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SECTION 3.11. Agreed Tax Treatment
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32
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SECTION 3.12. CUSIP Numbers
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32
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-i-
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Page
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ARTICLE IV Satisfaction and Discharge
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32
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SECTION 4.1. Satisfaction and Discharge of Indenture
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32
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SECTION 4.2. Application of Trust Money
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34
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ARTICLE V Remedies
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34
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SECTION 5.1. Events of Default
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34
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SECTION 5.2. Acceleration of Maturity; Rescission and Annulment
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35
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SECTION 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee
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36
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SECTION 5.4. Trustee May File Proofs of Claim
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37
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SECTION 5.5. Trustee May Enforce Claim Without Possession of Securities
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37
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SECTION 5.6. Application of Money Collected
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37
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SECTION 5.7. Limitation on Suits
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38
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SECTION 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders of Preferred
Securities
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39
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SECTION 5.9. Restoration of Rights and Remedies
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39
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SECTION 5.10. Rights and Remedies Cumulative
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39
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SECTION 5.11. Delay or Omission Not Waiver
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39
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SECTION 5.12. Control by Holders
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40
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SECTION 5.13. Waiver of Past Defaults
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40
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SECTION 5.14. Undertaking for Costs
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40
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SECTION 5.15. Waiver of Usury, Stay or Extension Laws
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41
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ARTICLE VI The Trustee
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41
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SECTION 6.1. Corporate Trustee Required
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41
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SECTION 6.2. Certain Duties and Responsibilities
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41
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SECTION 6.3. Notice of Defaults
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43
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SECTION 6.4. Certain Rights of Trustee
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43
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SECTION 6.5. May Hold Securities
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45
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SECTION 6.6. Compensation; Reimbursement; Indemnity
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45
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SECTION 6.7. Resignation and Removal; Appointment of Successor
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46
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SECTION 6.8. Acceptance of Appointment by Successor
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47
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SECTION 6.9. Merger, Conversion, Consolidation or Succession to Business
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47
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SECTION 6.10. Not Responsible for Recitals or Issuance of Securities
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47
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SECTION 6.11. Appointment of Authenticating Agent
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48
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ARTICLE VII Holders Lists and Reports by Trustee and Company
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49
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SECTION 7.1. Company to Furnish Trustee Names and Addresses of Holders
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49
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SECTION 7.2. Preservation of Information, Communications to Holders
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49
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SECTION 7.3. Reports by Company and Trustee
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50
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-ii-
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Page
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ARTICLE VIII Consolidation, Merger, Conveyance, Transfer or Lease
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50
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SECTION 8.1. Company May Consolidate, Etc., Only on Certain Terms
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50
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SECTION 8.2. Successor Company Substituted
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51
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ARTICLE IX Supplemental Indentures
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52
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SECTION 9.1. Supplemental Indentures without Consent of Holders
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52
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SECTION 9.2. Supplemental Indentures with Consent of Holders
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52
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SECTION 9.3. Execution of Supplemental Indentures
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53
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SECTION 9.4. Effect of Supplemental Indentures
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53
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SECTION 9.5. Reference in Securities to Supplemental Indentures
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53
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ARTICLE X Covenants
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54
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SECTION 10.1. Payment of Principal, Premium and Interest
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54
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SECTION 10.2. Money for Security Payments to be Held in Trust
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54
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SECTION 10.3. Statement as to Compliance
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55
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SECTION 10.4. Calculation Agent
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55
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SECTION 10.5. Additional Tax Sums
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56
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SECTION 10.6. Additional Covenants
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56
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SECTION 10.7. Waiver of Covenants
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57
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SECTION 10.8. Treatment of Securities
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57
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ARTICLE XI Redemption of Securities
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58
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SECTION 11.1. Optional Redemption
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58
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SECTION 11.2. Special Event Redemption
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58
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SECTION 11.3. Election to Redeem; Notice to Trustee
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58
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SECTION 11.4. Selection of Securities to be Redeemed
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58
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SECTION 11.5. Notice of Redemption
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|
|
59
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SECTION 11.6. Deposit of Redemption Price
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|
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60
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SECTION 11.7. Payment of Securities Called for Redemption
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60
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ARTICLE XII Subordination of Securities
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61
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SECTION 12.1. Securities Subordinate to Senior Debt
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61
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SECTION 12.2. No Payment When Senior Debt in Default; Payment Over of Proceeds Upon Dissolution,
Etc.
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61
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SECTION 12.3. Payment Permitted If No Default
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|
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62
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SECTION 12.4. Subrogation to Rights of Holders of Senior Debt
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63
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SECTION 12.5. Provisions Solely to Define Relative Rights
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|
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63
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SECTION 12.6. Trustee to Effectuate Subordination
|
|
|
63
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SECTION 12.7. No Waiver of Subordination Provisions
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|
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64
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-iii-
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Page
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SECTION 12.8. Notice to Trustee
|
|
|
64
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SECTION 12.9. Reliance on Judicial Order or Certificate of Liquidating Agent
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|
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65
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|
SECTION 12.10. Trustee Not Fiduciary for Holders of Senior Debt
|
|
|
65
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|
SECTION 12.11. Rights of Trustee as Holder of Senior Debt; Preservation of Trustees Rights
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|
|
65
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|
SECTION 12.12. Article Applicable to Paying Agents
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|
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65
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SCHEDULES
|
|
|
Schedule A
|
|
Determination of LIBOR
|
|
Exhibit A
|
|
Form of Officers Certificate
|
-iv-
Junior Subordinated Indenture
, dated as of September 29, 2006, between Texas Capital
Bancshares, Inc., a Delaware corporation (the
Company
), and
Wilmington Trust Company
, a
Delaware banking corporation, as Trustee (in such capacity, the
Trustee
).
Recitals of the Company
Whereas
, the Company has duly authorized the execution and delivery of this Indenture
to provide for the issuance of its unsecured junior subordinated deferrable interest notes (the
Securities
) issued to evidence loans made to the Company of the proceeds from the issuance by
Texas Capital Statutory Trust V, a Delaware statutory trust (the
Trust
), of undivided preferred
beneficial interests in the assets of the Trust (the
Preferred Securities
) and undivided common
beneficial interests in the assets of the Trust (the
Common Securities
and, collectively with the
Preferred Securities, the
Trust Securities
), and to provide the terms and conditions upon which
the Securities are to be authenticated, issued and delivered; and
Whereas
, all things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
Now, therefore, this Indenture Witnesseth:
For and in consideration of the premises and the purchase of the Securities by the Holders
thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders of the Securities, as follows:
ARTICLE I
Definitions and Other Provisions of General Application
SECTION 1.1.
Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or unless the
context otherwise requires:
(a) the terms defined in this
Article I
have the meanings assigned to them in
this
Article I
;
(b) the words include, includes and including shall be deemed to be followed by
the phrase without limitation;
(c) all accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with GAAP;
(d) unless the context otherwise requires, any reference to an Article or a Section
refers to an Article or a Section, as the case may be, of this Indenture;
(e) the words hereby, herein, hereof and hereunder and other words of similar
import refer to this Indenture as a whole and not to any particular Article, Section or
other subdivision;
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(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include the masculine,
feminine and neuter genders.
Act
when used with respect to any Holder, has the meaning specified in
Section 1.4
.
Administrative Trustee
means, with respect to the Trust, a Person identified as an
Administrative Trustee in the Trust Agreement, solely in its capacity as Administrative Trustee
of the Trust under the Trust Agreement and not in its individual capacity, or its successor in
interest in such capacity, or any successor Administrative Trustee appointed as therein provided.
Additional Interest
means the interest, if any, that shall accrue on any amounts payable on
the Securities, the payment of which has not been made on the applicable Interest Payment Date and
which shall accrue at the rate per annum specified or determined as specified in such Security.
Additional Tax Sums
has the meaning specified in
Section 10.5
.
Additional Taxes
means taxes, duties or other governmental charges imposed on the Trust as a
result of a Tax Event (which, for the sake of clarity, does not include amounts required to be
deducted or withheld by the Trust from payments made by the Trust to or for the benefit of the
Holder of, or any Person that acquires a beneficial interest in, the Securities).
Affiliate
of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, control, when used with respect to any specified Person, means the
power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms controlling and
controlled have meanings correlative to the foregoing.
Applicable Depository Procedures
means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and procedures of the
Depositary for such Security, in each case to the extent applicable to such transaction and as in
effect from time to time.
Authenticating Agent
means any Person authorized by the Trustee pursuant to
Section
6.11
to act on behalf of the Trustee to authenticate the Securities.
Bankruptcy Code
means Title 11 of the United States Code or any successor statute thereto,
in each case as amended from time to time.
Board of Directors
means the board of directors of the Company or any duly authorized
committee of that board.
Board Resolution
means a copy of a resolution certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and to be in full
force and effect on the date of such certification.
2
Business Day
means any day other than (i) a Saturday or Sunday, (ii) a day on which banking
institutions in the City of New York are authorized or required by law or executive order to remain
closed or (iii) a day on which the Corporate Trust Office of the Trustee is closed for business.
Calculation Agent
has the meaning specified in
Section 10.4
.
Capital Disqualification Event
means the receipt by the Company of an Opinion of Counsel
experienced in such matters that, as a result of an amendment to or a change in law, rule or
regulation (including any announced prospective change) or a change in interpretation or
application of law, rule or regulation by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk that within ninety (90) days of the
date of such opinion, the aggregate liquidation amount of the Preferred Securities will not be
eligible to be treated by the Company as Tier 1 Capital (or the then equivalent) for purposes of
the capital adequacy guidelines of the Federal Reserve or other appropriate Federal banking
agency as such term is defined in 12 U.S.C. 1813(q), which amendment, change or prospective change
becomes effective or would become effective, as the case may be, on or after the date of issuance
of the Securities;
provided, however,
that the inability of the Company to treat all or any portion
of the liquidation amount of the Preferred Securities as Tier 1 Capital shall not constitute the
basis for a Capital Disqualification Event if such inability results from the Company having such
Preferred Securities outstanding in an amount that for any reason is in excess of the amount which
may now or hereafter qualify for treatment as Tier 1 Capital under applicable capital adequacy
guidelines.
Common Securities
has the meaning specified in the first recital of this Indenture.
Common Stock
means the common stock, par value $0.01 per share, of the Company.
Company
means the Person named as the
Company
in the first paragraph of this Indenture
until a successor corporation shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter
Company
shall mean such successor corporation.
Company Request
and
Company Order
mean, respectively, the written request or order signed
in the name of the Company by its Chairman of the Board of Directors, its Vice Chairman of the
Board of Directors, its Chief Executive Officer, President or a Vice President, and by its Chief
Financial Officer, Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.
Corporate Trust Office
means the principal office of the Trustee at which at any particular
time its corporate trust business shall be administered, which office at the date of this Indenture
is located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-1600,
Attention: Corporate Trust Administration.
Debt
means, with respect to any Person, whether recourse is to all or a portion of the
assets of such Person, whether currently existing or hereafter incurred and whether or not
contingent and without duplication, (i) every obligation of such Person for money borrowed; (ii)
every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property, assets
3
or businesses; (iii) every reimbursement obligation of such Person with respect to letters of
credit, bankers acceptances or similar facilities issued for the account of such Person; (iv)
every obligation of such Person issued or assumed as the deferred purchase price of property or
services (but excluding trade accounts payable or other accrued liabilities arising in the ordinary
course of business); (v) every capital lease obligation of such Person; (vi) all indebtedness of
such Person, whether incurred on or prior to the date of this Indenture or thereafter incurred, for
claims in respect of derivative products, including interest rate, foreign exchange rate and
commodity forward contracts, options and swaps and similar arrangements; (vii) every obligation of
the type referred to in clauses (i) through (vi) of another Person and all dividends of another
Person the payment of which, in either case, such Person has guaranteed or is responsible or liable
for, directly or indirectly, as obligor or otherwise; and (viii) any renewals, extensions,
refundings, amendments or modifications of any obligation of the type referred to in clauses (i)
through (vii).
Defaulted Interest
has the meaning specified in
Section 3.1
.
Delaware Trustee
means, with respect to the Trust, the Person identified as the Delaware
Trustee in the Trust Agreement, solely in its capacity as Delaware Trustee of the Trust under the
Trust Agreement and not in its individual capacity, or its successor in interest in such capacity,
or any successor Delaware Trustee appointed as therein provided.
Depositary
means an organization registered as a clearing agency under the Exchange Act that
is designated as Depositary by the Company or any successor thereto. DTC will be the initial
Depositary.
Depository Participant
means a broker, dealer, bank, other financial institution or other
Person for whom from time to time a Depositary effects book-entry transfers and pledges of
securities deposited with the Depositary.
Distributions
means amounts payable in respect of the Trust Securities as provided in the
Trust Agreement and referred to therein as Distributions.
Dollar
or $ means the currency of the United States of America that, as at the time of
payment, is legal tender for the payment of public and private debts.
DTC
means The Depository Trust Company, a New York corporation.
Event of Default
has the meaning specified in
Section 5.1
.
Exchange Act
means the Securities Exchange Act of 1934 or any statute successor thereto, in
each case as amended from time to time.
Expiration Date
has the meaning specified in
Section 1.4
.
Extension Period
has the meaning specified in
Section 3.9
.
Federal Reserve
means the Board of Governors of the Federal Reserve System, the staff
thereof, or a Federal Reserve Bank, acting through delegated authority, in each case under
4
the rules, regulations and policies of the Federal Reserve System, or if at any time after the
execution of this Indenture any such entity is not existing and performing the duties now assigned
to it, any successor body performing similar duties or functions.
GAAP
means United States generally accepted accounting principles, consistently applied,
from time to time in effect.
Global Security
means a Security that evidences all or part of the Securities, the ownership
and transfers of which shall be made through book entries by a Depositary.
Government Obligation
means (a) any security that is (i) a direct obligation of the United
States of America of which the full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of America, which, in either
case (i) or (ii), is not callable or redeemable at the option of the issuer thereof, and (b) any
depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as
custodian with respect to any Government Obligation that is specified in clause (a) above and held
by such bank for the account of the holder of such depositary receipt, or with respect to any
specific payment of principal of or interest on any Government Obligation that is so specified and
held,
provided
, that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depositary receipt from any amount received
by the custodian in respect of the Government Obligation or the specific payment of principal or
interest evidenced by such depositary receipt.
Guarantee Agreement
means the Guarantee Agreement executed by the Company and Wilmington
Trust Company, as Guarantee Trustee, contemporaneously with the execution and delivery of this
Indenture, for the benefit of the holders of the Preferred Securities, as modified, amended or
supplemented from time to time.
Holder
means a Person in whose name a Security is registered in the Securities Register.
Indenture
means this instrument as originally executed or as it may from time to time be
amended or supplemented by one or more amendments or indentures supplemental hereto entered into
pursuant to the applicable provisions hereof.
Interest Payment Date
means March 31, June 30, September 30 and December 31 of each year,
commencing on December 31, 2006, during the term of this Indenture.
Investment Company Act
means the Investment Company Act of 1940 or any successor statute
thereto, in each case as amended from time to time.
Investment Company Event
means the receipt by the Company of an Opinion of Counsel
experienced in such matters to the effect that, as a result of the occurrence of a change in law,
rule or regulation (including any announced prospective change) or a written change in
interpretation or application of law, rule or regulation by any legislative body, court,
governmental agency or regulatory authority, there is more than an insubstantial risk that the
5
Trust is or, within ninety (90) days of the date of such opinion will be, considered an
investment company that is required to be registered under the Investment Company Act, which
change or prospective change becomes effective or would become effective, as the case may be, on or
after the date of the issuance of the Securities.
LIBOR
has the meaning specified in
Schedule A
.
LIBOR Business Day
has the meaning specified in
Schedule A
.
LIBOR Determination Date
has the meaning specified in
Schedule A
.
Maturity
, when used with respect to any Security, means the date on which the principal of
such Security or any installment of principal becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.
Notice of Default
means a written notice of the kind specified in
Section 5.1(d)
.
Office of Thrift Supervision
means the Office of Thrift Supervision, as from time to time
constituted or, if at any time after the execution of this Indenture such Office is not existing
and performing the duties now assigned to it, then the body performing such duties at such time.
Officers Certificate
means a certificate signed by the Chairman of the Board, a Vice
Chairman of the Board, the Chief Executive Officer, President or a Vice President, and by the Chief
Financial Officer, Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of
the Company and delivered to the Trustee.
Opinion of Counsel
means a written opinion of counsel, who may be counsel for or an employee
of the Company or any Affiliate of the Company.
Original Issue Date
means the date of original issuance of each Security.
Outstanding
means, when used in reference to any Securities, as of the date of
determination, all Securities theretofore authenticated and delivered under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the Trustee for
cancellation;
(ii) Securities for whose payment or redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust
or set aside and segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities;
provided
, that, if such Securities are to
be redeemed, notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made; and
(iii) Securities that have been paid, or in substitution for or in lieu of which other
Securities have been authenticated and delivered pursuant to the provisions of this
6
Indenture, unless proof satisfactory to the Trustee is presented that any such
Securities are held by Holders in whose hands such Securities are valid, binding and legal
obligations of the Company;
provided
, that, in determining whether the Holders of the requisite principal amount of Outstanding
Securities have given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only Securities that a
Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded.
Securities so owned that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgees right so to act with respect
to such Securities and that the pledgee is not the Company or any other obligor upon the Securities
or any Affiliate of the Company or such other obligor. Notwithstanding anything herein to the
contrary, Securities initially issued to the Trust that are owned by the Trust shall be deemed to
be Outstanding notwithstanding the ownership by the Company or an Affiliate of any beneficial
interest in the Trust.
Paying Agent
means the Trustee or any Person authorized by the Company to pay the principal
of or any premium or interest on, or other amounts in respect of, any Securities on behalf of the
Company.
Person
means a legal person, including any individual, corporation, estate, partnership,
joint venture, association, joint stock company, limited liability company, trust, unincorporated
association, government or any agency or political subdivision thereof, or any other entity of
whatever nature.
Place of Payment
means, with respect to the Securities, the Corporate Trust Office of the
Trustee.
Placement Agent
has the meaning specified in the Trust Agreement.
Preferred Securities
has the meaning specified in the first recital of this Indenture.
Predecessor Security
of any particular Security means every previous Security evidencing all
or a portion of the same debt as that evidenced by such particular Security. For the purposes of
this definition, any security authenticated and delivered under
Section 3.6
in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Security.
Proceeding
has the meaning specified in
Section 12.2
.
Property Trustee
means the Person identified as the Property Trustee in the Trust
Agreement, solely in its capacity as Property Trustee of the Trust under the Trust Agreement and
not in its individual capacity, or its successor in interest in such capacity, or any successor
Property Trustee appointed as therein provided.
7
Purchaser
means SunTrust Equity Funding, LLC, as purchaser of the Preferred Securities
pursuant to the Subscription Agreement.
Redemption Date
means, when used with respect to any Security to be redeemed, the date fixed
for such redemption by or pursuant to this Indenture.
Redemption Price
means, when used with respect to any Security to be redeemed, in whole or
in part, the price at which such security or portion thereof is to be redeemed as fixed by or
pursuant to this Indenture.
Reference Banks
has the meaning specified in
Schedule A
.
Regular Record Date
for the interest payable on any Interest Payment Date with respect to
the Securities means the date that is fifteen (15) days preceding such Interest Payment Date
(whether or not a Business Day).
Responsible Officer
means, with respect to the Trustee, any Senior Vice President, any Vice
President, any Assistant Vice President, the Secretary, any Assistant Secretary, the Treasurer, any
Assistant Treasurer, any Financial Services Officer or Assistant Financial Services Officer, or any
other officer of the Corporate Trust Department of the Trustee and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is referred because of
that officers knowledge of and familiarity with the particular subject.
Rights Plan
means a plan of the Company providing for the issuance by the Company to all
holders of its Common Stock of rights entitling the holders thereof to subscribe for or purchase
shares of any class or series of capital stock of the Company which rights (i) are deemed to be
transferred with such shares of such Common Stock and (ii) are also issued in respect of future
issuances of such Common Stock, in each case until the occurrence of a specified event or events.
Securities
or
Security
means any debt securities or debt security, as the case may be,
authenticated and delivered under this Indenture.
Securities Act
means the Securities Act of 1933 or any successor statute thereto, in each
case as amended from time to time.
Securities Register
and
Securities Registrar
have the respective meanings specified in
Section 3.5
.
Senior Debt
means the principal of and any premium and interest on (including interest
accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the
Company, whether or not such claim for post-petition interest is allowed in such proceeding) all
Debt of the Company, whether incurred on or prior to the date of this Indenture or thereafter
incurred, unless it is provided in the instrument creating or evidencing the same or pursuant to
which the same is outstanding, that such obligations are not superior in right of payment to the
Securities;
provided, however,
that if the Company is subject to the regulation and supervision of
an appropriate Federal banking agency within the meaning of 12 U.S.C. 1813(q), the Company shall
have received the approval of such appropriate Federal banking agency prior to issuing any
8
such obligation if not otherwise generally approved;
provided further,
that Senior Debt shall
not include any other debt securities, and guarantees in respect of such debt securities, issued to
any trust other than the Trust (or a trustee of such trust), partnership or other entity affiliated
with the Company that is a financing vehicle of the Company (a financing entity), in connection
with the issuance by such financing entity of equity securities or other securities that are
treated as equity capital for regulatory capital purposes guaranteed by the Company pursuant to an
instrument that ranks
pari passu
with or junior in right of payment to the Indenture, including,
without limitation, the debt securities of the Company issued under the Indentures, dated November
19, 2002, April 10, 2003, October 6, 2005 and April 28, 2006.
Special Event
means the occurrence of a Capital Disqualification Event, an Investment
Company Event or a Tax Event.
Special Event Redemption Price
has the meaning specified in
Section 11.2
.
Special Record Date
for the payment of any Defaulted Interest means a date fixed by the
Trustee pursuant to
Section 3.1
.
Stated Maturity
means December 31, 2036.
Subscription Agreement
means the Preferred Securities Subscription Agreement, dated as of
September 29, 2006, by and among the Company, the Trust, the Purchaser and SunTrust Capital
Markets, Inc. (as to certain provisions thereof).
Subsidiary
means a Person more than fifty percent (50%) of the outstanding voting stock or
other voting interests of which is owned, directly or indirectly, by the Company or by one or more
other Subsidiaries, or by the Company and one or more other Subsidiaries. For purposes of this
definition, voting stock means stock that ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.
Tax Event
means the receipt by the Company of an Opinion of Counsel experienced in such
matters to the effect that, as a result of (a) any amendment to or change (including any announced
prospective change) in the laws, rules or any regulations thereunder of the United States or any
political subdivision or taxing authority thereof or therein or (b) any judicial decision or any
official administrative pronouncement (including any private letter ruling, technical advice
memorandum or field service advice) or regulatory procedure, including any notice or announcement
of intent to adopt any such pronouncement or procedure (an Administrative Action), regardless of
whether such judicial decision or Administrative Action is issued to or in connection with a
proceeding involving the Company or the Trust and whether or not subject to review or appeal, which
amendment, change, judicial decision or Administrative Action is enacted, promulgated or announced,
in each case, on or after the date of issuance of the Securities, there is more than an
insubstantial risk that (i) the Trust is, or will be within ninety (90) days of the date of such
opinion, subject to United States federal income tax with respect to income received or accrued on
the Securities, (ii) interest payable by the Company on the Securities is not, or within ninety
(90) days of the date of such opinion, will not be, deductible by the Company, in whole or in part,
for United States federal income tax purposes, or (iii) the Trust
9
is, or will be within ninety (90) days of the date of such opinion, subject to more than a
de
minimis
amount of other taxes, duties or other governmental charges.
Trust
has the meaning specified in the first recital of this Indenture.
Trust Agreement
means the Amended and Restated Trust Agreement executed and delivered by the
Company, the Property Trustee, Wilmington Trust Company, as Delaware Trustee and the Administrative
Trustees named therein, contemporaneously with the execution and delivery of this Indenture, for
the benefit of the holders of the Trust Securities, as amended or supplemented from time to time.
Trustee
means the Person named as the
Trustee
in the first paragraph of this instrument,
solely in its capacity as such and not in its individual capacity, until a successor Trustee shall
have become such pursuant to the applicable provisions of this Indenture, and, thereafter,
Trustee
shall mean or include each Person who is then a Trustee hereunder.
Trust Indenture Act
means the Trust Indenture Act of 1939, as amended and as in effect on
the date as of this Indenture.
Trust Securities
has the meaning specified in the first recital of this Indenture.
SECTION 1.2.
Compliance Certificate and Opinions.
(a) Upon any application or request by the Company to the Trustee to take any action under any
provision of this Indenture, the Company shall furnish to the Trustee an Officers Certificate
stating that all conditions precedent (including covenants compliance with which constitutes a
condition precedent), if any, provided for in this Indenture relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent (including covenants compliance with which constitutes a condition precedent),
if any, have been complied with, except that, in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or opinion need be
furnished.
(b) Every certificate with respect to compliance with a condition or covenant provided for in
this Indenture (other than the certificate provided pursuant to
Section 10.3
) shall
include:
(i) a statement by each individual signing such certificate or opinion that such
individual has read such covenant or condition and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions of such individual contained in such certificate or
opinion are based;
(iii) a statement that, in the opinion of such individual, he or she has made such
examination or investigation as is necessary to enable him or her to express an informed
opinion as to whether or not such covenant or condition has been complied with; and
10
(iv) a statement as to whether, in the opinion of such individual, such condition or
covenant has been complied with.
SECTION 1.3.
Forms of Documents Delivered to Trustee.
(a) In any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified or covered by only
one document, but one such Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless
such officer knows, or after reasonable inquiry should know, that the certificate or opinion or
representations with respect to matters upon which his or her certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an officer or officers of
the Company stating that the information with respect to such factual matters is in the possession
of the Company, unless such counsel knows, or after reasonable inquiry should know, that the
certificate or opinion or representations with respect to such matters are erroneous.
(c) Where any Person is required to make, give or execute two or more applications, requests,
consents, certificates, statements, opinions or other instruments under this Indenture, they may,
but need not, be consolidated and form one instrument.
(d) Whenever, subsequent to the receipt by the Trustee of any Board Resolution, Officers
Certificate, Opinion of Counsel or other document or instrument, a clerical, typographical or other
inadvertent or unintentional error or omission shall be discovered therein, a new document or
instrument may be substituted therefor in corrected form with the same force and effect as if
originally received in the corrected form and, irrespective of the date or dates of the actual
execution and/or delivery thereof, such substitute document or instrument shall be deemed to have
been executed and/or delivered as of the date or dates required with respect to the document or
instrument for which it is substituted. Without limiting the generality of the foregoing, any
Securities issued under the authority of such defective document or instrument shall nevertheless
be the valid obligations of the Company entitled to the benefits of this Indenture equally and
ratably with all other Outstanding Securities.
SECTION 1.4.
Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given to or taken by Holders may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such Holders in person or by an
agent thereof duly appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments (including any appointment of an
agent) is or are delivered to the Trustee, and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied
11
therein and evidenced thereby) are herein sometimes referred to as the
Act
of the Holders
signing such instrument or instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in
favor of the Trustee and the Company, if made in the manner provided in this
Section 1.4
.
(b) The fact and date of the execution by any Person of any such instrument or writing may be
proved by the affidavit of a witness of such execution or by the certificate of any notary public
or other officer authorized by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him or her the execution thereof. Where such
execution is by a Person acting in other than his or her individual capacity, such certificate or
affidavit shall also constitute sufficient proof of his or her authority. The fact and date of the
execution by any Person of any such instrument or writing, or the authority of the Person executing
the same, may also be proved in any other manner that the Trustee deems sufficient and in
accordance with such reasonable rules as the Trustee may determine.
(c) The ownership of Securities shall be proved by the Securities Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other action by
the Holder of any Security shall bind every future Holder of the same Security and the Holder of
every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such Security.
(e) Without limiting the foregoing, a Holder entitled to take any action hereunder with regard
to any particular Security may do so with regard to all or any part of the principal amount of such
Security or by one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.
(f) Except as set forth in paragraph (g) of this
Section 1.4
, the Company may set any
day as a record date for the purpose of determining the Holders of Outstanding Securities entitled
to give, make or take any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Indenture to be given, made or taken by Holders of
Securities. If any record date is set pursuant to this paragraph, the Holders of Outstanding
Securities on such record date, and no other Holders, shall be entitled to take the relevant
action, whether or not such Holders remain Holders after such record date;
provided
, that no such
action shall be effective hereunder unless taken on or prior to the applicable Expiration Date (as
defined below) by Holders of the requisite principal amount of Outstanding Securities on such
record date. Nothing in this paragraph shall be construed to prevent the Company from setting a
new record date for any action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with no action by any
Person be canceled and of no effect). Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record date, the proposed
action by Holders and the applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Securities in the manner set forth in
Section 1.6
.
(g) The Trustee may set any day as a record date for the purpose of determining the Holders of
Outstanding Securities entitled to join in the giving or making of (i) any Notice of
12
Default, (ii) any declaration of acceleration or rescission or annulment thereof referred to
in
Section 5.2
, (iii) any request to institute proceedings referred to in
Section
5.7(b)
or (iv) any direction referred to in
Section 5.12
. If any record date is set
pursuant to this paragraph, the Holders of Outstanding Securities on such record date, and no other
Holders, shall be entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date;
provided
, that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date by Holders of the
requisite principal amount of Outstanding Securities on such record date. Nothing in this paragraph
shall be construed to prevent the Trustee from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be canceled and of no effect).
Promptly after any record date is set pursuant to this paragraph, the Trustee, at the Companys
expense, shall cause notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of Securities in the
manner set forth in
Section 1.6
.
(h) With respect to any record date set pursuant to paragraph (f) or (g) of this
Section
1.4
, the party hereto that sets such record date may designate any day as the
Expiration Date
and from time to time may change the Expiration Date to any earlier or later day;
provided
, that no
such change shall be effective unless notice of the proposed new Expiration Date is given to the
other party hereto in writing, and to each Holder of Securities in the manner set forth in
Section 1.6
, on or prior to the existing Expiration Date. If an Expiration Date is not
designated with respect to any record date set pursuant to this
Section 1.4
, the party
hereto that set such record date shall be deemed to have initially designated the ninetieth
(90
th
) day after such record date as the Expiration Date with respect thereto, subject
to its right to change the Expiration Date as provided in this paragraph. Notwithstanding the
foregoing, no Expiration Date shall be later than the one hundred and eightieth (180
th
)
day after the applicable record date.
SECTION 1.5.
Notices, Etc.
Any request, demand, authorization, direction, notice, consent, waiver, Act of Holders, or
other document provided or permitted by this Indenture to be made upon, given or furnished to, or
filed with:
(a) the Trustee by any Holder, any holder of Preferred Securities or the Company shall be
sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the
Trustee at its Corporate Trust Office,
(b) the Company by the Trustee, any Holder or any holder of Preferred Securities shall be
sufficient for every purpose hereunder if in writing and mailed, first class, postage prepaid, to
the Company addressed to it at 2100 McKinney Avenue, Suite 900, Dallas, Texas 75201, Attn: Chief
Financial Officer, or at any other address previously furnished in writing to the Trustee by the
Company,
(c) the Placement Agent by the Trustee, the Company, any Holder or any holder or beneficial
owner of the Preferred Securities, shall be sufficient for every purpose hereunder if in writing
and mailed, first-class postage prepaid to the Placement Agent at 303 Peachtree Street,
13
N.E., 24
th
Floor, Mail Code 3950, Atlanta, Georgia 30308 or any other address
previously furnished by the Placement Agent, or
(d) the Purchaser by the Trustee, the Company, any Holder or any holder or beneficial owner of
the Preferred Securities, shall be sufficient for every purpose hereunder if in writing and mailed
first-class postage prepaid to the Purchaser at 303 Peachtree Street NW, 26
th
Floor,
Atlanta, Georgia 30308, or any other address previously furnished by the Purchaser.
SECTION 1.6.
Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first
class, postage prepaid, to each Holder affected by such event to the address of such Holder as it
appears in the Securities Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. If, by reason of the suspension of or
irregularities in regular mail service or for any other reason, it shall be impossible or
impracticable to mail notice of any event to Holders when said notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect
in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either before or after the
event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall
be filed with the Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 1.7.
Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction of this Indenture.
SECTION 1.8.
Successors and Assigns.
This Indenture shall be binding upon and shall inure to the benefit of any successor to the
Company and the Trustee, including any successor by operation of law. Except in connection with a
transaction involving the Company that is permitted under
Article VIII
and pursuant to
which the assignee agrees in writing to perform the Companys obligations hereunder, the Company
shall not assign its obligations hereunder.
SECTION 1.9.
Separability Clause.
If any provision in this Indenture or in the Securities shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby, and there shall be deemed substituted for the provision at
issue a valid, legal and enforceable provision as similar as possible to the provision at issue.
14
SECTION 1.10.
Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall give to any Person,
other than the parties hereto and their successors and assigns, the holders of Senior Debt, the
Holders of the Securities and, to the extent expressly provided in
Sections 5.2
,
5.8
,
5.9
,
5.11
,
5.13
,
9.2
and
10.7
, the holders of
Preferred Securities, any benefit or any legal or equitable right, remedy or claim under this
Indenture.
SECTION 1.11.
Governing Law.
This Indenture and the rights and obligations of each of the Holders, the Company and the
Trustee shall be construed and enforced in accordance with and governed by the laws of the State of
New York without reference to its conflict of laws provisions (other than Section 5-1401 of the
General Obligations Law).
SECTION 1.12.
Submission to Jurisdiction.
ANY LEGAL ACTION OR PROCEEDING BY OR AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR ARISING
OUT OF THIS INDENTURE MAY BE BROUGHT IN OR REMOVED TO THE COURTS OF THE STATE OF NEW YORK, IN AND
FOR THE COUNTY OF NEW YORK, OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW
YORK (IN EACH CASE SITTING IN THE BOROUGH OF MANHATTAN). BY EXECUTION AND DELIVERY OF THIS
INDENTURE, EACH PARTY ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS (AND COURTS OF APPEALS THEREFROM) FOR
LEGAL PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS INDENTURE.
SECTION 1.13.
Non-Business Days.
If any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be
a Business Day, then (notwithstanding any other provision of this Indenture or the Securities)
payment of interest, premium or principal or other amounts in respect of such Security shall not be
made on such date, but shall be made on the next succeeding Business Day (and no interest shall
accrue in respect of the amounts whose payment is so delayed for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be, until such next
succeeding Business Day) except that, if such Business Day falls in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the Interest Payment Date or Redemption Date or at the Stated
Maturity.
ARTICLE II
Security Forms
SECTION 2.1.
Form of Security.
Any Security issued hereunder shall be in substantially the following form:
15
Texas Capital Bancshares, Inc.
Floating Rate Junior Subordinated Note due 2036
Texas Capital Bancshares, Inc., a corporation organized and existing under the laws of
Delaware (hereinafter called the
Company
, which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to Wilmington Trust
Company, not in its individual capacity but solely as Property Trustee for Texas Capital Statutory
Trust V, a Delaware statutory trust (the Holder), or registered assigns, the principal sum of
Forty One Million Two Hundred Thirty Eight Thousand ($41,238,000) Dollars or such other principal
amount represented hereby as may be set forth in the records of the Securities Registrar
hereinafter referred to in accordance with the Indenture on December 31, 2036. The Company further
promises to pay interest on said principal sum from September 29, 2006, or from the most recent
Interest Payment Date to which interest has been paid or duly provided for, quarterly (subject to
deferral as set forth herein) in arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on December 31, 2006, or if any such day is not a Business Day, on the next
succeeding Business Day (and no interest shall accrue in respect of the amounts whose payment is so
delayed for the period from and after such Interest Payment Date until such next succeeding
Business Day), except that, if such Business Day falls in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case, with the same force
and effect as if made on the Interest Payment Date, at an annual rate equal to 7.076880% beginning
on (and including) the Original Issue Date and ending on (but excluding) December 31, 2006 and at
an annual rate for each successive period beginning on (and including) December 31, 2006, and each
successive Interest Payment Date, and ending on (but excluding) the next succeeding Interest
Payment Date equal to LIBOR plus 1.71%, together with Additional Tax Sums, if any, as provided in
Section 10.5
of the Indenture, until the principal hereof is paid or duly provided for or
made available for payment;
provided
, that any overdue principal, premium or Additional Tax Sums
and any overdue installment of interest shall bear Additional Interest (to the extent that the
payment of such interest shall be legally enforceable) at a variable rate per annum, reset
quarterly, equal to LIBOR plus 1.71%, compounded quarterly, from the dates such amounts are due
until they are paid or made available for payment, and such interest shall be payable on demand.
The amount of interest payable shall be computed on the basis of a 360-day year and the actual
number of days elapsed in the relevant interest period, computed by dividing the actual number of
days elapsed in the period by 360 and multiplying the result by the applicable per annum rate in
effect for the period. The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date shall, as provided in the Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest installment. Any such interest not so punctually paid or
duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and
may either be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities not less than ten (10) days prior to such Special Record Date, or be paid
16
at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture.
So long as no Event of Default pursuant to
Sections 5.1(c), (e) or (f)
of the
Indenture has occurred and is continuing, the Company shall have the right, at any time and from
time to time during the term of this Security, to defer the payment of interest on this Security
for a period of up to twenty (20) consecutive quarterly interest payment periods (each such period,
an
Extension Period
), during which Extension Period(s), no interest shall be due and payable
(except any Additional Tax Sums that may be due and payable). No Extension Period shall end on a
date other than an Interest Payment Date, and no Extension Period shall extend beyond the Stated
Maturity of the principal of this Security. No interest shall be due and payable during an
Extension Period (except any Additional Tax Sums that may be due and payable), except at the end
thereof, but each installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent payment of such interest would
be legally enforceable) at a variable rate per annum, reset quarterly, equal to LIBOR plus 1.71%,
compounded quarterly, from the dates on which amounts would have otherwise been due and payable
until paid or made available for payment. At the end of any such Extension Period, the Company
shall pay all interest then accrued and unpaid on this Security, together with such Additional
Interest. Prior to the termination of any such Extension Period, the Company may further defer the
payment of interest;
provided
, that (i) all such previous and further extensions comprising such
Extension Period do not exceed twenty (20) quarterly interest payment periods, (ii) no Extension
Period shall end on a date other than an Interest Payment Date and (iii) no Extension Period shall
extend beyond the Stated Maturity of the principal of this Security. Upon the termination of any
such Extension Period and upon the payment of all accrued and unpaid interest and any Additional
Interest then due on any Interest Payment Date, the Company may elect to begin a new Extension
Period;
provided
, that (i) such Extension Period does not exceed twenty (20) quarterly interest
payment periods, (ii) no Extension Period shall end on a date other than an Interest Payment Date
and (iii) no Extension Period shall extend beyond the Stated Maturity of the principal of this
Security. The Company shall give the Holder of this Security and the Trustee written notice of its
election to begin any such Extension Period at least five Business Days prior to the next
succeeding Interest Payment Date on which interest on this Security would be payable but for such
deferral or, so long as this Security is held by the Trust, at least five Business Days prior to
the earlier of (i) the next succeeding date on which Distributions on the Preferred Securities of
Texas Capital Statutory Trust V would be payable but for such deferral and (ii) the date on which
the Property Trustee of such Trust is required to give notice to any securities exchange or other
applicable self-regulatory organization or to holders of such Preferred Securities of the record
date for the payment of such Distributions.
During any such Extension Period, the Company shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any
of the Companys capital stock or (ii) make any payment of principal of or any interest or premium
on or repay, repurchase or redeem any debt securities of the Company that rank
pari passu
in all
respects with or junior in interest to this Security (other than (a) repurchases, redemptions or
other acquisitions of shares of capital stock of the Company in connection with (1) any employment
contract, benefit plan or other similar arrangement with or
17
for the benefit of any one or more employees, officers, directors or consultants, (2) a
dividend reinvestment or stockholder stock purchase plan or (3) the issuance of capital stock of
the Company (or securities convertible into or exercisable for such capital stock) as consideration
in an acquisition transaction entered into prior to the applicable Extension Period, (b) as a
result of a reclassification of the Guarantors capital stock or the exchange or conversion of any
class or series of the Companys capital stock (or any capital stock of a Subsidiary of the
Company) for any class or series of the Companys capital stock or of any class or series of the
Companys indebtedness for any class or series of the Companys capital stock, (c) the purchase of
fractional interests in shares of the Companys capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend or distribution in connection with any Rights Plan, the issuance of
rights, stock or other property under any Rights Plan, or the redemption or repurchase of rights
pursuant thereto or (e) any dividend or distribution in the form of stock, warrants, options or
other rights where the dividend or distribution stock or the stock issuable upon exercise of such
warrants, options or other rights is the same stock as that on which the dividend or distribution
is being paid or ranks
pari passu
with or junior to such stock).
Payment of principal of, premium, if any, and interest on this Security shall be made in such
coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts. Payments of principal, premium, if any, and interest due at
the Maturity of this Security shall be made at the office or agency of the Company maintained for
that purpose in the Place of Payment upon surrender of such Securities to the Paying Agent, and
payments of interest shall be made, subject to such surrender where applicable, by wire transfer at
such place and to such account at a banking institution in the United States as may be designated
in writing to the Paying Agent at least ten (10) Business Days prior to the date for payment by the
Person entitled thereto unless proper written transfer instructions have not been received by the
relevant record date, in which case such payments shall be made by check mailed to the address of
such Person as such address shall appear in the Security Register. Notwithstanding the foregoing,
so long as the holder of this Security is the Property Trustee, the payment of the principal of
(and premium, if any) and interest (including any overdue installment of interest and Additional
Tax Sums, if any) on this Security will be made at such place and to such account as may be
designated by the Property Trustee.
The indebtedness evidenced by this Security is, to the extent provided in the Indenture,
subordinate and junior in right of payment to the prior payment in full of all Senior Debt, and
this Security is issued subject to the provisions of the Indenture with respect thereto. Each
Holder of this Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his or her behalf to take such actions as may
be necessary or appropriate to effectuate the subordination so provided and (c) appoints the
Trustee his or her attorney-in-fact for any and all such purposes. Each Holder hereof, by his or
her acceptance hereof, waives all notice of the acceptance of the subordination provisions
contained herein and in the Indenture by each holder of Senior Debt, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said provisions.
Unless the certificate of authentication hereon has been executed by the Trustee by manual
signature, this Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
18
This Security is one of a duly authorized issue of securities of the Company (the
Securities
) issued under the Junior Subordinated Indenture, dated as of September 29, 2006 (the
Indenture
), between the Company and Wilmington Trust Company, as Trustee (in such capacity, the
Trustee
, which term includes any successor trustee under the Indenture), to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee, the
holders of Senior Debt and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
All terms used in this Security that are defined in the Indenture or in the Amended and
Restated Trust Agreement, dated as of September 29, 2006 (as modified, amended or supplemented from
time to time, the
Trust Agreement
), relating to Texas Capital Statutory Trust V (the
Trust
),
among the Company, as Depositor, the Trustees named therein and the Holders from time to time of
the Trust Securities issued pursuant thereto, shall have the meanings assigned to them in the
Indenture or the Trust Agreement, as the case may be.
The Company may, on any Interest Payment Date, at its option, upon not less than thirty (30)
days nor more than sixty (60) days written notice to the Holders of the Securities (unless a
shorter notice period shall be satisfactory to the Trustee) on or after December 31, 2011 and
subject to the terms and conditions of
Article XI
of the Indenture, redeem this Security in
whole at any time or in part from time to time at a Redemption Price equal to one hundred percent
(100%) of the principal amount hereof, together, in the case of any such redemption, with accrued
interest, including any Additional Interest, to but excluding the date fixed for redemption;
provided
, that the Company shall have received the prior approval of the Federal Reserve if then
required.
In addition, upon the occurrence and during the continuation of a Special Event, the Company
may, at its option, upon not less than thirty (30) days nor more than sixty (60) days written
notice to the Holders of the Securities (unless a shorter notice period shall be satisfactory to
the Trustee), redeem this Security, in whole but not in part, subject to the terms and conditions
of
Article XI
of the Indenture at the Special Event Redemption Price;
provided
, that the
Company shall have received the prior approval of the Federal Reserve if then required.
In the event of redemption of this Security in part only, a new Security or Securities for the
unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation
hereof. If less than all the Securities are to be redeemed, the particular Securities to be
redeemed shall be selected not more than sixty (60) days prior to the Redemption Date by the
Trustee from the Outstanding Securities not previously called for redemption, by such method as the
Trustee shall deem fair and appropriate and which may provide for the selection for redemption of a
portion of the principal amount of any Security.
The Indenture permits, with certain exceptions as therein provided, the Company and the
Trustee at any time to enter into a supplemental indenture or indentures for the purpose of
modifying in any manner the rights and obligations of the Company and of the Holders of the
Securities, with the consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities. The Indenture also contains provisions permitting Holders of specified
percentages in principal amount of the Securities, on behalf of the Holders of all Securities, to
19
waive compliance by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay
the principal of and any premium and interest, including any Additional Interest, on this Security
at the times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Securities Register, upon surrender of this
Security for registration of transfer at the office or agency of the Company maintained for such
purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory
to the Company and the Securities Registrar and duly executed by, the Holder hereof or such
Holders attorney duly authorized in writing, and thereupon one or more new Securities, of like
tenor, of authorized denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees.
The Securities are issuable only in registered form without coupons in minimum denominations
of $100,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities are exchangeable for a like aggregate
principal amount of Securities and of like tenor of a different authorized denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Security is registered as the owner hereof for all purposes, whether or not this
Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
The Company and, by its acceptance of this Security or a beneficial interest therein, the
Holder of, and any Person that acquires a beneficial interest in, this Security agree that, for
United States federal, state and local tax purposes, it is intended that this Security constitute
indebtedness.
This Security shall be construed and enforced in accordance with and governed by the laws of
the State of New York, without reference to its conflict of laws provisions (other than Section
5-1401 of the General Obligations Law).
20
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.
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TEXAS CAPITAL BANCSHARES, INC.
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By:
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Name: Peter Bartholow
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Title: Chief Financial Officer
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SECTION 2.2.
Restrictive Legend.
(a) Any Security issued hereunder shall bear a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES
ACT), AND SUCH SECURITIES, AND ANY INTEREST THEREIN, MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF ANY SECURITIES IS HEREBY NOTIFIED THAT THE SELLER OF THE SECURITIES MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A UNDER THE SECURITIES ACT.
THE HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) SUCH SECURITIES MAY BE OFFERED, RESOLD OR OTHERWISE TRANSFERRED ONLY (I) TO
THE COMPANY, (II) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (III) TO AN INSTITUTIONAL ACCREDITED INVESTOR
WITHIN THE MEANING OF SUBPARAGRAPH (a) (1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (IV) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (V) PURSUANT TO AN EXEMPTION
FROM THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND, IN THE CASE OF
(III) OR (V), SUBJECT TO THE RIGHT OF THE COMPANY TO REQUIRE AN OPINION OF COUNSEL AND OTHER
INFORMATION SATISFACTORY TO IT AND (B) THE HOLDER WILL NOTIFY
21
ANY PURCHASER OF ANY SECURITIES FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
THE SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN AGGREGATE
PRINCIPAL AMOUNT OF NOT LESS THAN $100,000. TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
ATTEMPTED TRANSFER OF SECURITIES, OR ANY INTEREST THEREIN, IN A BLOCK HAVING AN AGGREGATE
PRINCIPAL AMOUNT OF LESS THAN $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH SECURITIES
FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PRINCIPAL OF OR INTEREST ON
SUCH SECURITIES, OR ANY INTEREST THEREIN, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.
THE HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF
ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT, INDIVIDUAL
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (
ERISA
), OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
CODE
) (EACH A
PLAN
), OR AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY PLANS INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING PLAN ASSETS OF ANY PLAN MAY ACQUIRE OR HOLD THIS SECURITY OR ANY
INTEREST THEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF
AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23,
95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF
THIS SECURITY, OR ANY INTEREST THEREIN, IS NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR HOLDER OF THE
SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND
HOLDING THEREOF THAT EITHER (i) IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE MEANING OF
SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE
OR OTHER PERSON ACTING ON BEHALF OF AN EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR
ENTITY USING THE ASSETS OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE, OR
(ii) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH THERE IS NO APPLICABLE STATUTORY OR
ADMINISTRATIVE EXEMPTION.
22
THIS OBLIGATION IS NOT A DEPOSIT AND IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR
FUND OF THE UNITED STATES, INCLUDING THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE
FDIC
).
(b) The above legend shall not be removed from any Security unless there is delivered to the
Company satisfactory evidence, which may include an opinion of counsel, as may be reasonably
required to ensure that any future transfers thereof may be made without restriction under the
provisions of the Securities Act and other applicable law. Upon provision of such satisfactory
evidence, the Company shall execute and deliver to the Trustee, and the Trustee shall deliver, at
the written direction of the Company, a Security that does not bear the legend.
SECTION 2.3.
Form of Trustees Certificate of Authentication.
The Trustees certificate of authentication shall be in substantially the following form:
This is one of the Securities referred to in the within-mentioned Indenture.
Dated: September 29, 2006
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WILMINGTON TRUST COMPANY,
as Trustee
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By:
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Authorized officer
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SECTION 2.4.
Temporary Securities.
(a) Pending the preparation of definitive Securities, the Company may execute, and upon
Company Order the Trustee shall authenticate and deliver, temporary Securities that are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any denomination, substantially
of the tenor of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the officers executing
such Securities may determine, as evidenced by their execution of such Securities.
(b) If temporary Securities are issued, the Company will cause definitive Securities to be
prepared without unreasonable delay. After the preparation of definitive Securities, the temporary
Securities shall be exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Securities, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor one or more definitive
Securities of any authorized denominations having the same Original Issue Date and Stated Maturity
and having the same terms as such temporary Securities. Until so exchanged, the temporary
Securities shall in all respects be entitled to the same benefits under this Indenture as
definitive Securities.
23
SECTION 2.5.
Definitive Securities.
The Securities issued on the Original Issue Date shall be in definitive form. The definitive
Securities shall be printed, lithographed or engraved, or produced by any combination of these
methods, if required by any securities exchange on which the Securities may be listed, on a steel
engraved border or steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as determined by the
officers executing such Securities, as evidenced by their execution of such Securities.
ARTICLE III
The Securities
SECTION 3.1.
Payment of Principal and Interest.
(a) The unpaid principal amount of the Securities shall bear interest at an annual rate equal
to 7.076880% beginning on (and including) the Original Issue Date and ending on (but excluding)
December 31, 2006 and at a variable rate per annum, reset quarterly, for each successive period
beginning on (and including) December 31, 2006, and each successive Interest Payment Date, and
ending on (but excluding) the next succeeding Interest Payment Date equal to LIBOR plus 1.71%, and
any overdue principal, premium or Additional Tax Sums and any overdue installment of interest shall
bear Additional Interest (to the extent payment of such interest would be legally enforceable) at a
variable rate per annum, reset quarterly, equal to LIBOR plus 1.71% from the dates such amounts are
due until they are paid or funds for the payment thereof are made available for payment.
(b) Interest and Additional Interest on any Security that is payable, and is punctually paid
or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that
Security (or one or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, except that interest and any Additional Interest payable on
the Stated Maturity (or any date of principal repayment upon early maturity) of the principal of a
Security or on a Redemption Date shall be paid to the Person to whom principal is paid. The initial
payment of interest on any Security that is issued between a Regular Record Date and the related
Interest Payment Date shall be payable as provided in such Security.
(c) Any interest on any Security that is due and payable, but is not timely paid or duly
provided for, on any Interest Payment Date for Securities (herein called
Defaulted Interest
)
shall forthwith cease to be payable to the registered Holder on the relevant Regular Record Date by
virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in paragraph (i) or (ii) below:
(i) The Company may elect to make payment of any Defaulted Interest to the Persons in
whose names the Securities (or their respective Predecessor Securities) are registered at
the close of business on a Special Record Date for the payment of such Defaulted Interest (a
Special Record Date
), which shall be fixed in the following manner. At least thirty (30)
days prior to the date of the proposed payment, the Company
24
shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Security and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to
be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such Defaulted
Interest. Thereupon the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest, which shall be not more than fifteen (15) days and not less than ten
(10) days prior to the date of the proposed payment and not less than ten (10) days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor to be mailed, first class, postage prepaid, to each Holder of a
Security at the address of such Holder as it appears in the Securities Register not less
than ten (10) days prior to such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered on such Special Record Date; or
(ii) The Company may make payment of any Defaulted Interest in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the Securities
may be listed and, upon such notice as may be required by such exchange (or by the Trustee
if the Securities are not listed), if, after notice given by the Company to the Trustee of
the proposed payment pursuant to this clause, such payment shall be deemed practicable by
the Trustee.
(d) Payments of interest on the Securities shall include interest accrued to but excluding the
respective Interest Payment Dates. The amount of interest payable shall be computed on the basis of
a 360-day year and the actual number of days elapsed in the relevant interest period, computed by
dividing the actual number of days elapsed in the period by 360 and multiplying the result by the
applicable per annum rate in effect for the period.
(e) Payment of principal of, premium, if any, and interest on the Securities shall be made in
such coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts. Payments of principal, premium, if any, and interest due at
the Maturity of such Securities shall be made at the Place of Payment upon surrender of such
Securities to the Paying Agent and payments of interest shall be made subject to such surrender
where applicable, by wire transfer at such place and to such account at a banking institution in
the United States as may be designated in writing to the Paying Agent at least ten (10) Business
Days prior to the date for payment by the Person entitled thereto unless proper written transfer
instructions have not been received by the relevant record date, in which case such payments shall
be made by check mailed to the address of such Person as such address shall appear in the Security
Register. Notwithstanding the foregoing, so long as the holder of the Security is the Property
Trustee, the payment of the principal of (and premium if any) and interest (including any overdue
installment of interest and Additional Tax Sums, if any) on the
25
Security will be made at such place and to such account as may be designated by the Property
Trustee.
(f) Subject to the foregoing provisions of this
Section 3.1
, each Security delivered
under this Indenture upon transfer of or in exchange for or in lieu of any other Security shall
carry the rights to interest accrued and unpaid, and to accrue, that were carried by such other
Security.
SECTION 3.2.
Denominations.
The Securities shall be in registered form without coupons and shall be issuable in minimum
denominations of $100,000 and any integral multiple of $1,000 in excess thereof.
SECTION 3.3.
Execution, Authentication, Delivery and Dating.
(a) At any time and from time to time after the execution and delivery of this Indenture, the
Company may deliver Securities in an aggregate principal amount (including all then Outstanding
Securities) not in excess of FORTY ONE MILLION TWO HUNDRED THIRTY EIGHT THOUSAND ($41,238,000)
DOLLARS executed by the Company to the Trustee for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in accordance with the
Company Order shall authenticate and deliver such Securities. In authenticating such Securities,
and accepting the additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and shall be fully protected in relying upon:
(i) a copy of any Board Resolution relating thereto; and
(ii) an Opinion of Counsel stating that such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and legally binding
obligations of the Company, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to or
affecting creditors rights and to general equity principles.
(b) The Securities shall be executed on behalf of the Company by its Chairman of the Board,
its Vice Chairman of the Board, its President or one of its Vice Presidents. The signature of any
of these officers on the Securities may be manual or facsimile. Securities bearing the manual or
facsimile signatures of individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not hold such offices at
the date of such Securities.
(c) No Security shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless there appears on such Security a certificate of authentication
substantially in the form provided for herein executed by the Trustee by the manual signature of
one of its authorized officers, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated and delivered
hereunder. Notwithstanding the foregoing, if any Security shall have been authenticated and
26
delivered hereunder but never issued and sold by the Company, and the Company shall deliver
such Security to the Trustee for cancellation as provided in
Section 3.8
, for all purposes
of this Indenture such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
(d) Each Security shall be dated the date of its authentication.
SECTION 3.4.
Global Securities.
(a) Upon the election of the Holder after the Original Issue Date, which election need not be
in writing, the Securities owned by such Holder shall be issued in the form of one or more Global
Securities registered in the name of the Depositary or its nominee. Each Global Security issued
under this Indenture shall be registered in the name of the Depositary designated by the Company
for such Global Security or a nominee thereof and delivered to such Depositary or a nominee thereof
or custodian therefor, and each such Global Security shall constitute a single Security for all
purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global Security may be exchanged
in whole or in part for Securities registered, and no transfer of a Global Security in whole or in
part may be registered, in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (i) such Depositary advises the Trustee and the Company in
writing that such Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and no qualified successor is
appointed by the Company within ninety (90) days of receipt by the Company of such notice, (ii)
such Depositary ceases to be a clearing agency registered under the Exchange Act and no successor
is appointed by the Company within ninety (90) days after obtaining knowledge of such event, (iii)
the Company executes and delivers to the Trustee a Company Order stating that the Company elects to
terminate the book-entry system through the Depositary or (iv) an Event of Default shall have
occurred and be continuing. Upon the occurrence of any event specified in clause (i), (ii), (iii)
or (iv) above, the Trustee shall notify the Depositary and instruct the Depositary to notify all
owners of beneficial interests in such Global Security of the occurrence of such event and of the
availability of Securities to such owners of beneficial interests requesting the same. Upon the
issuance of such Securities and the registration in the Securities Register of such Securities in
the names of the Holders of the beneficial interests therein, the Trustees shall recognize such
holders of beneficial interests as Holders.
(c) If any Global Security is to be exchanged for other Securities or canceled in part, or if
another Security is to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for exchange or cancellation
as provided in this
Article III
or (ii) the principal amount thereof shall be reduced or
increased by an amount equal to the portion thereof to be so exchanged or canceled, or equal to the
principal amount of such other Security to be so exchanged for a beneficial interest therein, as
the case may be, by means of an appropriate adjustment made on the records of the Securities
Registrar, whereupon the Trustee, in accordance with the Applicable Depository Procedures, shall
instruct the Depositary or its authorized representative to make a corresponding adjustment to its
records. Upon any such surrender or adjustment of a Global Security by the Depositary, accompanied
by registration instructions, the Company shall execute and the Trustee shall
27
authenticate and deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) in accordance with the instructions of the Depositary. The Trustee shall not be
liable for any delay in delivery of such instructions and may conclusively rely on, and shall be
fully protected in relying on, such instructions.
(d) Every Security authenticated and delivered upon registration of transfer of, or in
exchange for or in lieu of, a Global Security or any portion thereof shall be authenticated and
delivered in the form of, and shall be, a Global Security, unless such Security is registered in
the name of a Person other than the Depositary for such Global Security or a nominee thereof.
(e) Securities distributed to holders of Book-Entry Preferred Securities (as defined in the
applicable Trust Agreement) upon the dissolution of the Trust shall be distributed in the form of
one or more Global Securities registered in the name of a Depositary or its nominee, and deposited
with the Securities Registrar, as custodian for such Depositary, or with such Depositary, for
credit by the Depositary to the respective accounts of the beneficial owners of the Securities
represented thereby (or such other accounts as they may direct). Securities distributed to holders
of Preferred Securities other than Book-Entry Preferred Securities upon the dissolution of the
Trust shall not be issued in the form of a Global Security or any other form intended to facilitate
book-entry trading in beneficial interests in such Securities.
(f) The Depositary or its nominee, as the registered owner of a Global Security, shall be the
Holder of such Global Security for all purposes under this Indenture and the Securities, and owners
of beneficial interests in a Global Security shall hold such interests pursuant to the Applicable
Depository Procedures. Accordingly, any such owners beneficial interest in a Global Security shall
be shown only on, and the transfer of such interest shall be effected only through, records
maintained by the Depositary or its nominee or its Depositary Participants. The Securities
Registrar and the Trustee shall be entitled to deal with the Depositary for all purposes of this
Indenture relating to a Global Security (including the payment of principal and interest thereon
and the giving of instructions or directions by owners of beneficial interests therein and the
giving of notices) as the sole Holder of the Security and shall have no obligations to the owners
of beneficial interests therein. Neither the Trustee nor the Securities Registrar shall have any
liability in respect of any transfers effected by the Depositary.
(g) The rights of owners of beneficial interests in a Global Security shall be exercised only
through the Depositary and shall be limited to those established by law and agreements between such
owners and the Depositary and/or its Depositary Participants.
(h) No holder of any beneficial interest in any Global Security held on its behalf by a
Depositary shall have any rights under this Indenture with respect to such Global Security, and
such Depositary may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the owner of such Global Security for all purposes whatsoever. None of the Company, the
Trustee, nor any agent of the Company or the Trustee will have any responsibility or liability for
any aspect of the records relating to or payments made on account of beneficial ownership interests
of a Global Security or maintaining, supervising or reviewing any records relating to such
beneficial ownership interests. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by a Depositary or
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impair, as between a Depositary and such holders of beneficial interests, the operation of
customary practices governing the exercise of the rights of the Depositary (or its nominee) as
Holder of any Security.
SECTION 3.5.
Registration, Transfer and Exchange Generally.
(a) The Trustee shall cause to be kept at the Corporate Trust Office a register (the
"
Securities Register
) in which the registrar and transfer agent with respect to the Securities
(the
Securities Registrar
), subject to such reasonable regulations as it may prescribe, shall
provide for the registration of Securities and of transfers and exchanges of Securities. The
Trustee shall at all times also be the Securities Registrar. The provisions of
Article VI
shall apply to the Trustee in its role as Securities Registrar.
(b) Upon surrender for registration of transfer of any Security at the offices or agencies of
the Company designated for that purpose the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or transferees, one or more new
Securities of any authorized denominations of like tenor and aggregate principal amount.
(c) At the option of the Holder, Securities may be exchanged for other Securities of any
authorized denominations, of like tenor and aggregate principal amount, upon surrender of the
Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities
that the Holder making the exchange is entitled to receive.
(d) All Securities issued upon any transfer or exchange of Securities shall be the valid
obligations of the Company, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Securities surrendered upon such transfer or exchange.
(e) Every Security presented or surrendered for transfer or exchange shall (if so required by
the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Company and the Securities Registrar, duly executed by the Holder
thereof or such Holders attorney duly authorized in writing.
(f) No service charge shall be made to a Holder for any transfer or exchange of Securities,
but the Company and the Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any transfer or exchange of Securities.
(g) Neither the Company nor the Trustee shall be required pursuant to the provisions of this
Section 3.5
, (i) to issue, register the transfer of or exchange any Security during a
period beginning at the opening of business fifteen (15) days before the day of selection for
redemption of Securities pursuant to
Article XI
and ending at the close of business on the
day of mailing of the notice of redemption or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of any such Security
to be redeemed in part, any portion thereof not to be redeemed.
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(h) The Company shall designate an office or offices or agency or agencies where Securities
may be surrendered for registration or transfer or exchange. The Company initially designates the
Corporate Trust Office as its office and agency for such purposes. The Company shall give prompt
written notice to the Trustee and to the Holders of any change in the location of any such office
or agency.
SECTION 3.6.
Mutilated, Destroyed, Lost and Stolen Securities.
(a) If any mutilated Security is surrendered to the Trustee together with such security or
indemnity as may be required by the Company or the Trustee to save each of them harmless, the
Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new
Security of like tenor and aggregate principal amount and bearing a number not contemporaneously
outstanding.
(b) If there shall be delivered to the Company and to the Trustee (i) evidence to their
satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity
as may be required by them to save each of them harmless, then, in the absence of notice to the
Company or the Trustee that such Security has been acquired by a
bona fide
purchaser, the Company
shall execute and upon its written request the Trustee shall authenticate and deliver, in lieu of
any such destroyed, lost or stolen Security, a new Security of like tenor and aggregate principal
amount as such destroyed, lost or stolen Security, and bearing a number not contemporaneously
outstanding.
(c) If any such mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Company in its discretion may, instead of issuing a new Security, pay such
Security.
(d) Upon the issuance of any new Security under this
Section 3.6
, the Company may
require the payment of a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.
(e) Every new Security issued pursuant to this
Section 3.6
in lieu of any mutilated,
destroyed, lost or stolen Security shall constitute an original additional contractual obligation
of the Company, whether or not the mutilated, destroyed, lost or stolen Security shall be at any
time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
(f) The provisions of this
Section 3.6
are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities.
SECTION 3.7.
Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee shall treat the Person in
whose name any Security is registered as the owner of such Security for the purpose of receiving
payment of principal of and any interest on such Security and for all other purposes
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whatsoever, and neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
SECTION 3.8.
Cancellation.
All Securities surrendered for payment, redemption, transfer or exchange shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee, and any such Securities and
Securities surrendered directly to the Trustee for any such purpose shall be promptly canceled by
it. The Company may at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder that the Company may have acquired in any manner whatsoever,
and all Securities so delivered shall be promptly canceled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided in this
Section
3.8
, except as expressly permitted by this Indenture. All canceled Securities shall be disposed
of by the Trustee in accordance with its customary practices and the Trustee shall deliver to the
Company a certificate of such disposition.
SECTION 3.9.
Deferrals of Interest Payment Dates.
(a) So long as no Event of Default pursuant to
Sections 5.1(c), (e) or (f)
has
occurred and is continuing, the Company shall have the right, at any time and from time to time
during the term of the Security, to defer the payment of interest on the Securities for a period of
up to twenty (20) consecutive quarterly interest payment periods (each such period, an
Extension
Period
), during which Extension Period(s), the Company shall have the right to make no payments or
partial payments of interest on any Interest Payment Date (except any Additional Tax Sums that
otherwise may be due and payable). No Extension Period shall end on a date other than an Interest
Payment Date and no Extension Period shall extend beyond the Stated Maturity of the principal of
the Securities. No interest shall be due and payable during an Extension Period, except at the end
thereof, but each installment of interest that would otherwise have been due and payable during
such Extension Period shall bear Additional Interest (to the extent payment of such interest would
be legally enforceable) at a variable rate per annum, reset quarterly, equal to LIBOR plus 1.71%,
compounded quarterly, from the dates on which amounts would have otherwise been due and payable
until paid or until funds for the payment thereof have been made available for payment. At the end
of any such Extension Period, the Company shall pay all interest then accrued and unpaid on the
Securities together with such Additional Interest. Prior to the termination of any such Extension
Period, the Company may extend such Extension Period and further defer the payment of interest;
provided
, that (i) all such previous and further extensions comprising such Extension Period do not
exceed twenty (20) quarterly interest payment periods, (ii) no Extension Period shall end on a date
other than an Interest Payment Date and (iii) no Extension Period shall extend beyond the Stated
Maturity of the principal of the Securities. Upon the termination of any such Extension Period and
upon the payment of all accrued and unpaid interest and any Additional Interest then due on any
Interest Payment Date, the Company may elect to begin a new Extension Period;
provided
, that (i)
such Extension Period does not exceed twenty (20) quarterly interest payment periods, (ii) no
Extension Period shall end on a date other than an Interest Payment Date and (iii) no Extension
Period shall extend beyond the Stated Maturity of the principal of the Securities. The Company
shall give (i) the Holders of the Securities, (ii) the Trustee, (iii) the Property Trustee and (iv)
any beneficial owner of the Preferred Securities reasonably identified to the Company (which
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identification may be made either by such beneficial owner or by the Placement Agent or the
Purchaser) written notice of its election to begin any such Extension Period at least five (5)
Business Days prior to the next succeeding Interest Payment Date on which interest on the
Securities would be payable but for such deferral.
(b) In connection with any such Extension Period, the Company shall be subject to the
restrictions set forth in
Section 10.6(a)
.
SECTION 3.10.
Right of Set-Off.
Notwithstanding anything to the contrary herein, the Company shall have the right to set off
any payment it is otherwise required to make in respect of any Security to the extent the Company
has theretofore made, or is concurrently on the date of such payment making, a payment under the
Guarantee Agreement relating to such Security or to a holder of Preferred Securities pursuant to an
action undertaken under
Section 5.8
of this Indenture.
SECTION 3.11.
Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Company and, by its acceptance or
acquisition of a Security or a beneficial interest therein, the Holder of, and any Person that
acquires a direct or indirect beneficial interest in, such Security, intend and agree to treat such
Security as indebtedness of the Company for United States Federal, state and local tax purposes and
to treat the Preferred Securities (including but not limited to all payments and proceeds with
respect to the Preferred Securities) as an undivided beneficial ownership interest in the
Securities (and payments and proceeds therefrom, respectively) for United States Federal, state and
local tax purposes. The provisions of this Indenture shall be interpreted to further this
intention and agreement of the parties.
SECTION 3.12.
CUSIP Numbers.
The Company in issuing the Securities may use CUSIP numbers (if then generally in use), and,
if so, the Trustee shall use CUSIP numbers in notices of redemption and other similar or related
materials as a convenience to Holders;
provided
, that any such notice or other materials may state
that no representation is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of redemption or other materials and that reliance may be
placed only on the other identification numbers printed on the Securities, and any such redemption
shall not be affected by any defect in or omission of such numbers.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1.
Satisfaction and Discharge of Indenture.
This Indenture shall, upon Company Request, cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein expressly provided
for and as otherwise provided in this
Section 4.1
) and the Trustee, on demand of and at
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the expense of the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered (other than (A) Securities
that have been mutilated, destroyed, lost or stolen and that have been replaced or paid as
provided in
Section 3.6
and (B) Securities for whose payment money has theretofore
been deposited in trust or segregated and held in trust by the Company and thereafter repaid
to the Company or discharged from such trust as provided in Section 10.2) have been
delivered to the Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee for cancellation
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(A)
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have become due and payable, or
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(B)
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will become due and payable at their Stated
Maturity within one year of the date of deposit, or
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(C)
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are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of the
Company,
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and the Company, in the case of subclause (ii)(A), (B) or (C) above, has deposited or caused
to be deposited with the Trustee as trust funds in trust for such purpose (x) an amount in
the currency or currencies in which the Securities are payable, (y) Government Obligations
which through the scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due date of any payment, money
in an amount or (z) a combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for cancellation, for principal
and any premium and interest (including any Additional Interest) to the date of such deposit
(in the case of Securities that have become due and payable) or to the Stated Maturity (or
any date of principal repayment upon early maturity) or Redemption Date, as the case may be;
(b) the Company has paid or caused to be paid all other sums payable hereunder by the Company;
and
(c) the Company has delivered to the Trustee an Officers Certificate and an Opinion of
Counsel each stating that all conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to
the Trustee under
Section 6.6
, the obligations of the Company to any Authenticating Agent
under
Section 6.11
and, if money shall have been deposited with the Trustee pursuant to
33
subclause (a)(ii) of this
Section 4.1
, the obligations of the Trustee under Section 4.2 and
Section 10.2(e)
shall survive.
SECTION 4.2.
Application of Trust Money.
Subject to the provisions of
Section 10.2(e)
, all money deposited with the Trustee
pursuant to
Section 4.1
shall be held in trust and applied by the Trustee, in accordance
with the provisions of the Securities and this Indenture, to the payment in accordance with
Section 3.1
, either directly or through any Paying Agent (including the Company acting as
its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the
principal and any premium and interest (including any Additional Interest) for the payment of which
such money or obligations have been deposited with or received by the Trustee. Moneys held by the
Trustee under this
Section 4.2
shall not be subject to the claims of holders of Senior Debt
under
Article XII
.
ARTICLE V
Remedies
SECTION 5.1.
Events of Default.
Event of Default
means, wherever used herein with respect to the Securities, any one of the
following events (whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any interest upon any Security, including any Additional
Interest in respect thereof, when it becomes due and payable, and continuance of such default for a
period of thirty (30) days (subject to the deferral of any due date in the case of an Extension
Period); or
(b) default in the payment of the principal of or any premium on any Security at its Maturity;
or
(c) default in the payment of any interest upon any Security, including any Additional
Interest in respect thereof, following the nonpayment of any such interest for twenty (20) or more
consecutive quarterly interest payment periods; or
(d) default in the performance, or breach, of any covenant or warranty of the Company in this
Indenture and continuance of such default or breach for a period of thirty (30) days after there
has been given, by registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least twenty-five percent (25%) in aggregate principal amount
of the Outstanding Securities a written notice specifying such default or breach and requiring it
to be remedied and stating that such notice is a Notice of Default hereunder; or
34
(e) the entry by a court having jurisdiction in the premises of a decree or order adjudging
the Company a bankrupt or insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of the Company under any
applicable Federal or state bankruptcy, insolvency, reorganization or other similar law, or
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or ordering the winding up or
liquidation of its affairs, and the continuance of any such decree or order for relief or any such
other decree or order unstayed and in effect for a period of sixty (60) consecutive days; or
(f) the institution by the Company of proceedings to be adjudicated a bankrupt or insolvent,
or the consent by the Company to the institution of bankruptcy or insolvency proceedings against
it, or the filing by the Company of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or state bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in writing of its inability to pay
its debts generally as they become due and its willingness to be adjudicated a bankrupt or
insolvent, or the taking of corporate action by the Company in furtherance of any such action; or
(g) the Trust shall have voluntarily or involuntarily liquidated, dissolved, wound-up its
business or otherwise terminated its existence, except in connection with (1) the distribution of
the Securities to holders of the Preferred Securities in liquidation of their interests in the
Trust, (2) the redemption of all of the outstanding Preferred Securities or (3) certain mergers,
consolidations or amalgamations, each as and to the extent permitted by the Trust Agreement.
SECTION 5.2.
Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default pursuant to
Sections 5.1(c), (e) or (f)
occurs and is
continuing, then and in every such case the Trustee or the Holders of not less than twenty five
percent (25%) in principal amount of the Outstanding Securities may declare the principal amount of
all the Securities to be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), provided, that if, upon an Event of Default pursuant to
Sections 5.1(c), (e) or (f)
, the Trustee or the Holders of not less than twenty five
percent (25%) in principal amount of the Outstanding Securities fail to declare the principal of
all the Outstanding Securities to be immediately due and payable, the holders of at least twenty
five percent (25%) in aggregate Liquidation Amount (as defined in the Trust Agreement) of the
Preferred Securities then outstanding shall have the right to make such declaration by a notice in
writing to the Property Trustee, the Company and the Trustee; and upon any such declaration the
principal amount of and the accrued interest (including any Additional Interest) on all the
Securities shall become immediately due and payable.
(b) At any time after such a declaration of acceleration with respect to Securities has been
made and before a judgment or decree for payment of the money due has been obtained by the Trustee
as hereinafter provided in this
Article V
, the Holders of a majority in principal amount of
the Outstanding Securities, by written notice to the Indenture Trustee, or the Holders
35
of a majority in aggregate liquidation amount of the Preferred Securities, by written notice
to the Property Trustee, the Company and the Trustee, may rescind and annul such declaration and
its consequences if:
(i) the Company has paid or deposited with the Trustee a sum sufficient to pay:
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(A)
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all overdue installments of interest on all
Securities,
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(B)
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any accrued Additional Interest on all
Securities,
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(C)
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the principal of and any premium on any
Securities that have become due otherwise than by such declaration of
acceleration and interest (including any Additional Interest) thereon
at the rate borne by the Securities, and
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(D)
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all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses, disbursements and
advances of the Trustee, the Property Trustee and their agents and
counsel; and
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(ii) all Events of Default with respect to Securities, other than the non-payment of
the principal of Securities that has become due solely by such acceleration, have been cured
or waived as provided in
Section 5.13
;
provided
, that if the Holders of such Securities fail to annul such declaration and waive such
default, the holders of not less than a majority in aggregate Liquidation Amount (as defined in the
Trust Agreement) of the Preferred Securities then outstanding shall also have the right to rescind
and annul such declaration and its consequences by written notice to the Property Trustee, the
Company and the Trustee, subject to the satisfaction of the conditions set forth in paragraph (b)
of this
Section 5.2
. No such rescission shall affect any subsequent default or impair any
right consequent thereon.
SECTION 5.3.
Collection of Indebtedness and Suits for Enforcement by Trustee.
(a) The Company covenants that if:
(i) default is made in the payment of any installment of interest (including any
Additional Interest) on any Security when such interest becomes due and payable and such
default continues for a period of thirty (30) days, or
(ii) default is made in the payment of the principal of and any premium on any Security
at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to the Trustee, for the benefit of the Holders of
such Securities, the whole amount then due and payable on such Securities for principal and any
premium and interest (including any Additional Interest) and, in addition thereto, all amounts
owing the Trustee under
Section 6.6
.
36
(b) If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its
own name and as trustee of an express trust, may institute a judicial proceeding for the collection
of the sums so due and unpaid, and may prosecute such proceeding to judgment or final decree, and
may enforce the same against the Company or any other obligor upon such Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of the property of the
Company or any other obligor upon the Securities, wherever situated.
(c) If an Event of Default with respect to Securities occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights of the Holders of
Securities by such appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
SECTION 5.4.
Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or similar judicial proceeding relative to the Company (or any other
obligor upon the Securities), its property or its creditors, the Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized
hereunder in order to have claims of the Holders and the Trustee allowed in any such proceeding. In
particular, the Trustee shall be authorized to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly to the Holders, to
first pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts owing the Trustee, any
predecessor Trustee and other Persons under
Section 6.6
.
SECTION 5.5.
Trustee May Enforce Claim Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be prosecuted and
enforced by the Trustee without the possession of any of the Securities or the production thereof
in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of judgment shall, subject
to
Article XII
and after provision for the payment of all the amounts owing the Trustee,
any predecessor Trustee and other Persons under
Section 6.6
, be for the ratable benefit of
the Holders of the Securities in respect of which such judgment has been recovered.
SECTION 5.6.
Application of Money Collected.
Any money or property collected or to be applied by the Trustee with respect to the Securities
pursuant to this
Article V
shall be applied in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money or property on account of
principal or any premium or interest (including any Additional Interest), upon presentation of the
37
Securities and the notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee, any predecessor Trustee and other
Persons under
Section 6.6
;
SECOND: To the payment of all Senior Debt of the Company if and to the extent required by
Article XII
;
THIRD: Subject to
Article XII
, to the payment of the amounts then due and unpaid upon
the Securities for principal and any premium and interest (including any Additional Interest) in
respect of which or for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and payable on the Securities for
principal and any premium and interest (including any Additional Interest), respectively; and
FOURTH: The balance, if any, to the Person or Persons entitled thereto.
SECTION 5.7.
Limitation on Suits.
Subject to
Section 5.8
, no Holder of any Securities shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture or for the appointment of a
custodian, receiver, assignee, trustee, liquidator, sequestrator (or other similar official) or for
any other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of a continuing Event of
Default with respect to the Securities;
(b) the Holders of not less than a majority in aggregate principal amount of the Outstanding
Securities shall have made written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable indemnity against the costs,
expenses and liabilities to be incurred in compliance with such request;
(d) the Trustee after its receipt of such notice, request and offer of indemnity has failed to
institute any such proceeding for sixty (60) days; and
(e) no direction inconsistent with such written request has been given to the Trustee during
such sixty (60)-day period by the Holders of a majority in aggregate principal amount of the
Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have any right in any
manner whatever by virtue of, or by availing itself of, any provision of this Indenture to affect,
disturb or prejudice the rights of any other Holders of Securities, or to obtain or to seek to
obtain priority or preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable benefit of all such
Holders.
38
SECTION 5.8.
Unconditional Right of Holders to Receive Principal, Premium and Interest; Direct
Action by Holders of Preferred Securities.
Notwithstanding any other provision in this Indenture, the Holder of any Security shall have
the right, which is absolute and unconditional, to receive payment of the principal of and any
premium on such Security at its Maturity and payment of interest (including any Additional
Interest) on such Security when due and payable and to institute suit for the enforcement of any
such payment, and such right shall not be impaired without the consent of such Holder. Any
registered holder of the Preferred Securities shall have the right, upon the occurrence of an Event
of Default described in
Section 5.1(a)
,
Section 5.1(b)
or
Section 5.1(c)
,
to institute a suit directly against the Company for enforcement of payment to such holder of
principal of and any premium and interest (including any Additional Interest) on the Securities
having a principal amount equal to the aggregate Liquidation Amount (as defined in the Trust
Agreement) of the Preferred Securities held by such holder.
SECTION 5.9.
Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Preferred Securities has instituted any proceeding
to enforce any right or remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee, such Holder or such
holder of Preferred Securities, then and in every such case the Company, the Trustee, such Holders
and such holder of Preferred Securities shall, subject to any determination in such proceeding, be
restored severally and respectively to their former positions hereunder, and thereafter all rights
and remedies of the Trustee, such Holder and such holder of Preferred Securities shall continue as
though no such proceeding had been instituted.
SECTION 5.10.
Rights and Remedies Cumulative.
Except as otherwise provided in
Section 3.6(f)
, no right or remedy herein conferred
upon or reserved to the Trustee or the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
SECTION 5.11.
Delay or Omission Not Waiver.
No delay or omission of the Trustee, any Holder of any Securities or any holder of any
Preferred Security to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this
Article V
or by law to the Trustee or to the
Holders and the right and remedy given to the holders of Preferred Securities by
Section
5.8
may be exercised from time to time, and as often as may be deemed expedient, by the
Trustee, the Holders or the holders of Preferred Securities, as the case may be.
39
SECTION 5.12.
Control by Holders.
The Holders of not less than a majority in aggregate principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee;
provided
, that:
(a) such direction shall not be in conflict with any rule of law or with this Indenture,
(b) the Trustee may take any other action deemed proper by the Trustee that is not
inconsistent with such direction, and
(c) subject to the provisions of
Section 6.2
, the Trustee shall have the right to
decline to follow such direction if a Responsible Officer or Officers of the Trustee shall, in good
faith, reasonably determine that the proceeding so directed would be unjustly prejudicial to the
Holders not joining in any such direction or would involve the Trustee in personal liability.
SECTION 5.13.
Waiver of Past Defaults.
(a) The Holders of not less than a majority in aggregate principal amount of the Outstanding
Securities or the Holders of a majority in aggregate Liquidation Amount (as defined in the Trust
Agreement) of the Preferred Securities may waive any past Event of Default hereunder and its
consequences except an Event of Default:
(i) in the payment of the principal of or any premium or interest (including any
Additional Interest) on any Security (unless such Event of Default has been cured and the
Company has paid to or deposited with the Trustee a sum sufficient to pay all installments
of interest (including any Additional Interest) due and past due and all principal of and
any premium on all Securities due otherwise than by acceleration), or
(ii) in respect of a covenant or provision hereof that under
Article IX
cannot
be modified or amended without the consent of each Holder of any Outstanding Security.
(b) Any such waiver shall be deemed to be on behalf of the Holders of all the Securities or,
in the case of a waiver by holders of Preferred Securities issued by such Trust, by all holders of
Preferred Securities.
(c) Upon any such waiver, such Event of Default shall cease to exist and any Event of Default
arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Event of Default or impair any right consequent
thereon.
SECTION 5.14.
Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by his or her acceptance
thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee
for any action taken or omitted by it as Trustee, the filing by any party litigant in
40
such suit of an undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys fees and expenses, against any
party litigant in such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; but the provisions of this
Section 5.14
shall not
apply to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than ten percent (10%) in aggregate principal amount of the
Outstanding Securities, or to any suit instituted by any Holder for the enforcement of the payment
of the principal of or any premium on the Security after the Stated Maturity or any interest
(including any Additional Interest) on any Security after it is due and payable.
SECTION 5.15.
Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it will not at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any
usury, stay or extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein granted to the Trustee,
but will suffer and permit the execution of every such power as though no such law had been
enacted.
ARTICLE VI
The Trustee
SECTION 6.1.
Corporate Trustee Required.
There shall at all times be a Trustee hereunder with respect to the Securities. The Trustee
shall be a corporation organized and doing business under the laws of the United States or of any
state thereof, authorized to exercise corporate trust powers, having a combined capital and surplus
of at least $50,000,000, subject to supervision or examination by Federal or state authority and
having an office within the United States. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of such supervising or examining authority,
then, for the purposes of this
Section 6.1
, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this
Section 6.1
, it shall resign immediately in the
manner and with the effect hereinafter specified in this
Article VI
.
SECTION 6.2.
Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
41
(ii) in the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Indenture;
provided
, that in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they substantially conform
on their face to the requirements of this Indenture.
(b) If an Event of Default known to the Trustee has occurred and is continuing, the Trustee
shall, prior to the receipt of directions, if any, from the Holders of at least a majority in
aggregate principal amount of the Outstanding Securities, exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of such persons own
affairs.
(c) Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the performance of any
of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it. Whether or not therein expressly so provided,
every provision of this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section 6.2
.
To the extent that, at law or in equity, the Trustee has duties and liabilities relating to the
Holders, the Trustee shall not be liable to any Holder for the Trustees good faith reliance on the
provisions of this Indenture. The provisions of this Indenture, to the extent that they restrict
the duties and liabilities of the Trustee otherwise existing at law or in equity, are agreed by the
Company and the Holders to replace such other duties and liabilities of the Trustee.
(d) No provisions of this Indenture shall be construed to relieve the Trustee from liability
with respect to matters that are within the authority of the Trustee under this Indenture for its
own negligent action, negligent failure to act or willful misconduct, except that:
(i) the Trustee shall not be liable for any error or judgment made in good faith by an
authorized officer of the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts;
(ii) the Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of at least a
majority in aggregate principal amount of the Outstanding Securities relating to the time,
method and place of conducting any proceeding for any remedy available to the Trustee under
this Indenture; and
(iii) the Trustee shall be under no liability for interest on any money received by it
hereunder except as otherwise agreed with the Company and money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required by law.
42
SECTION 6.3.
Notice of Defaults.
Within ninety (90) days after the occurrence of any default actually known to the Trustee, the
Trustee shall give the Holders notice of such default unless such default shall have been cured or
waived;
provided
, that except in the case of a default in the payment of the principal of or any
premium or interest on any Securities, the Trustee shall be fully protected in withholding the
notice if and so long as the board of directors, the executive committee or a trust committee of
directors and/or Responsible Officers of the Trustee in good faith determines that withholding the
notice is in the interest of holders of Securities; and
provided
, that in the case of any default
of the character specified in
Section 5.1(d)
, no such notice to Holders shall be given
until at least thirty (30) days after the occurrence thereof. For the purpose of this
Section
6.3
, the term default means any event which is, or after notice or lapse of time or both
would become, an Event of Default.
SECTION 6.4.
Certain Rights of Trustee.
Subject to the provisions of
Section 6.2
:
(a) the Trustee may conclusively rely and shall be fully protected in acting or refraining
from acting in good faith and in accordance with the terms hereof upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note or other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) if (i) in performing its duties under this Indenture the Trustee is required to decide
between alternative courses of action, (ii) in construing any of the provisions of this Indenture
the Trustee finds ambiguous or inconsistent with any other provisions contained herein or (iii) the
Trustee is unsure of the application of any provision of this Indenture, then, except as to any
matter as to which the Holders are entitled to decide under the terms of this Indenture, the
Trustee shall deliver a notice to the Company requesting the Companys written instruction as to
the course of action to be taken and the Trustee shall take such action, or refrain from taking
such action, as the Trustee shall be instructed in writing to take, or to refrain from taking, by
the Company;
provided
, that if the Trustee does not receive such instructions from the Company
within ten Business Days after it has delivered such notice or such reasonably shorter period of
time set forth in such notice the Trustee may, but shall be under no duty to, take such action, or
refrain from taking such action, as the Trustee shall deem advisable and in the best interests of
the Holders, in which event the Trustee shall have no liability except for its own negligence, bad
faith or willful misconduct;
(c) any request or direction of the Company shall be sufficiently evidenced by a Company
Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced
by a Board Resolution;
(d) the Trustee may consult with counsel (which counsel may be counsel to the Trustee, the
Company or any of its Affiliates, and may include any of its employees) and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
43
protection in respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory
to it against the costs, expenses (including reasonable attorneys fees and expenses) and
liabilities that might be incurred by it in compliance with such request or direction, including
reasonable advances as may be requested by the Trustee;
(f) the Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, indenture, note or other paper or document, but the Trustee in its discretion
may make such inquiry or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, attorneys, custodians or nominees and the
Trustee shall not be responsible for any misconduct or negligence on the part of any such agent,
attorney, custodian or nominee appointed with due care by it hereunder;
(h) whenever in the administration of this Indenture the Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or taking any other action with
respect to enforcing any remedy or right hereunder, the Trustees (i) may request instructions from
the Holders (which instructions may only be given by the Holders of the same aggregate principal
amount of Outstanding Securities as would be entitled to direct the Trustee under this Indenture in
respect of such remedy, right or action), (ii) may refrain from enforcing such remedy or right or
taking such action until such instructions are received and (iii) shall be protected in acting in
accordance with such instructions;
(i) except as otherwise expressly provided by this Indenture, the Trustee shall not be under
any obligation to take any action that is discretionary under the provisions of this Indenture;
(j) without prejudice to any other rights available to the Trustee under applicable law, when
the Trustee incurs expenses or renders services in connection with any bankruptcy, insolvency or
other proceeding referred to in clauses (e) or (f) of the definition of Event of Default, such
expenses (including legal fees and expenses of its agents and counsel) and the compensation for
such services are intended to constitute expenses of administration under any bankruptcy laws or
law relating to creditors rights generally;
(k) whenever in the administration of this Indenture the Trustee shall deem it desirable that
a matter be proved or established prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith
on its part, conclusively rely upon an Officers Certificate addressing such matter, which, upon
receipt of such request, shall be promptly delivered by the Company;
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(l) the Trustee shall not be charged with knowledge of any Event of Default unless either (i)
a Responsible Officer of the Trustee shall have actual knowledge or (ii) the Trustee shall have
received notice thereof from the Company or a Holder; and
(m) in the event that the Trustee is also acting as Paying Agent, Authenticating Agent or
Securities Registrar hereunder, the rights and protections afforded to the Trustee pursuant to this
Article VI
shall also be afforded such Paying Agent, Authenticating Agent, or Securities
Registrar.
SECTION 6.5.
May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities Registrar or any other
agent of the Company, in its individual or any other capacity, may become the owner or pledgee of
Securities and may otherwise deal with the Company with the same rights it would have if it were
not Trustee, Authenticating Agent, Paying Agent, Securities Registrar or such other agent.
SECTION 6.6.
Compensation; Reimbursement; Indemnity.
(a) The Company agrees
(i) to pay to the Trustee from time to time reasonable compensation for all services
rendered by it hereunder in such amounts as the Company and the Trustee shall agree from
time to time (which compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(ii) to reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses and disbursements
of its agents and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence, bad faith or willful misconduct; and
(iii) to the fullest extent permitted by applicable law, to indemnify the Trustee and
its Affiliates, and their officers, directors, shareholders, agents, representatives and
employees for, and to hold them harmless against, any loss, damage, action, suit, liability,
tax (other than income, franchise or other taxes imposed on amounts paid pursuant to (i) or
(ii) hereof), penalty, expense or claim of any kind or nature whatsoever incurred without
negligence, bad faith or willful misconduct on its part arising out of or in connection with
the acceptance or administration of this trust or the performance of the Trustees duties
hereunder, including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or duties
hereunder.
(b) The obligations of the Company under this
Section 6.6
shall survive the
satisfaction and discharge of this Indenture and the earlier resignation or removal of the Trustee.
(c) In no event shall the Trustee be liable for any indirect, special, punitive or
consequential loss or damage of any kind whatsoever, including, but not limited to, lost profits,
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even if the Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action.
(d) In no event shall the Trustee be liable for any failure or delay in the performance of its
obligations hereunder because of circumstances beyond its control, including, but not limited to,
acts of God, flood, war (whether declared or undeclared), terrorism, fire, riot, embargo,
government action, including any laws, ordinances, regulations, governmental action or the like
which delay, restrict or prohibit the providing of the services contemplated by this Indenture.
SECTION 6.7.
Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this
Article VI
shall become effective until the acceptance of appointment by
the successor Trustee under
Section 6.8
.
(b) The Trustee may resign at any time by giving written notice thereof to the Company.
(c) Unless an Event of Default shall have occurred and be continuing, the Trustee may be
removed at any time by the Company by a Board Resolution. If an Event of Default shall have
occurred and be continuing, the Trustee may be removed by Act of the Holders of a majority in
aggregate principal amount of the Outstanding Securities, delivered to the Trustee and to the
Company.
(d) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy
shall occur in the office of Trustee for any reason, at a time when no Event of Default shall have
occurred and be continuing, the Company, by a Board Resolution, shall promptly appoint a successor
Trustee, and such successor Trustee and the retiring Trustee shall comply with the applicable
requirements of
Section 6.8
. If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any reason, at a time when an
Event of Default shall have occurred and be continuing, the Holders, by Act of the Holders of a
majority in aggregate principal amount of the Outstanding Securities, shall promptly appoint a
successor Trustee, and such successor Trustee and the retiring Trustee shall comply with the
applicable requirements of
Section 6.8
. If no successor Trustee shall have been so
appointed by the Company or the Holders and accepted appointment within sixty (60) days after the
giving of a notice of resignation by the Trustee or the removal of the Trustee in the manner
required by
Section 6.8
, any Holder who has been a bona fide Holder of a Security for at
least six months may, on behalf of such Holder and all others similarly situated, and any resigning
Trustee may, at the expense of the Company, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(e) The Company shall give notice to all Holders in the manner provided in
Section 1.6
of each resignation and each removal of the Trustee and each appointment of a successor Trustee.
Each notice shall include the name of the successor Trustee and the address of its Corporate Trust
Office.
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SECTION 6.8.
Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee, each successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring
Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer
and deliver to such successor Trustee all property and money held by such retiring Trustee
hereunder.
(b) Upon request of any such successor Trustee, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming to such successor Trustee all
rights, powers and trusts referred to in paragraph (a) of this
Section 6.8
.
(c) No successor Trustee shall accept its appointment unless at the time of such acceptance
such successor Trustee shall be qualified and eligible under this
Article VI
.
SECTION 6.9.
Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder, without the
execution or filing of any paper or any further act on the part of any of the parties hereto,
provided
, that such Person shall be otherwise qualified and eligible under this
Article VI
.
In case any Securities shall have been authenticated, but not delivered, by the Trustee then in
office, any successor by merger, conversion or consolidation or as otherwise provided above in this
Section 6.9
to such authenticating Trustee may adopt such authentication and deliver the
Securities so authenticated, and in case any Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of any predecessor
Trustee or in the name of such successor Trustee, and in all cases the certificate of
authentication shall have the full force which it is provided anywhere in the Securities or in this
Indenture that the certificate of the Trustee shall have.
SECTION 6.10.
Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustees certificates of
authentication, shall be taken as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the Securities. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or application by the
Company of the Securities or the proceeds thereof.
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SECTION 6.11.
Appointment of Authenticating Agent.
(a) The Trustee may appoint an Authenticating Agent or Agents with respect to the Securities,
which shall be authorized to act on behalf of the Trustee to authenticate Securities issued upon
original issue and upon exchange, registration of transfer or partial redemption thereof or
pursuant to
Section 3.6
, and Securities so authenticated shall be entitled to the benefits
of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the authentication and delivery
of Securities by the Trustee or the Trustees certificate of authentication, such reference shall
be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating
Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a
corporation organized and doing business under the laws of the United States of America, or of any
State or Territory thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and
subject to supervision or examination by Federal or state authority. If such Authenticating Agent
publishes reports of condition at least annually pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this
Section 6.11
the combined
capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the provisions of this
Section 6.11
, such Authenticating Agent shall resign immediately in the manner and with the
effect specified in this
Section 6.11
.
(b) Any Person into which an Authenticating Agent may be merged or converted or with which it
may be consolidated, or any Person resulting from any merger, conversion or consolidation to which
such Authenticating Agent shall be a party, or any Person succeeding to all or substantially all of
the corporate trust business of an Authenticating Agent shall be the successor Authenticating Agent
hereunder, provided such Person shall be otherwise eligible under this
Section 6.11
,
without the execution or filing of any paper or any further act on the part of the Trustee or the
Authenticating Agent.
(c) An Authenticating Agent may resign at any time by giving written notice thereof to the
Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating
Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the provisions of this
Section 6.11
, the Trustee may appoint a successor Authenticating Agent eligible under the
provisions of this
Section 6.11
, which shall be acceptable to the Company, and shall give
notice of such appointment to all Holders. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an Authenticating Agent.
(d) The Company agrees to pay to each Authenticating Agent from time to time reasonable
compensation for its services under this
Section 6.11
in such amounts as the Company and
the Authenticating Agent shall agree from time to time.
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(e) If an appointment of an Authenticating Agent is made pursuant to this
Section
6.11
, the Securities may have endorsed thereon, in addition to the Trustees certificate of
authentication, an alternative certificate of authentication in the following form:
This is one of the Securities referred to in the within mentioned Indenture.
Dated:
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WILMINGTON TRUST COMPANY, not in its individual
capacity, but solely as Trustee
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Authenticating Agent
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By:
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Authorized Officer
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ARTICLE VII
Holders Lists and Reports by Trustee and Company
SECTION 7.1.
Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, on or before June 30 and December 31 of each year, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the Holders as of a date not more
than fifteen (15) days prior to the delivery thereof, and
(b) at such other times as the Trustee may request in writing, within thirty (30) days after
the receipt by the Company of any such request, a list of similar form and content as of a date not
more than fifteen (15) days prior to the time such list is furnished, in each case to the extent
such information is in the possession or control of the Company and has not otherwise been received
by the Trustee in its capacity as Securities Registrar.
SECTION 7.2.
Preservation of Information, Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably practicable, the names
and addresses of Holders contained in the most recent list furnished to the Trustee as provided in
Section 7.1
and the names and addresses of Holders received by the Trustee in its capacity
as Securities Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1
upon receipt of a new list so furnished.
49
(b) The rights of Holders to communicate with other Holders with respect to their rights under
this Indenture or under the Securities, and the corresponding rights and privileges of the Trustee,
shall be as provided in the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same, agrees with the Company and
the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held
accountable by reason of the disclosure of information as to the names and addresses of the Holders
made pursuant to the Trust Indenture Act.
SECTION 7.3.
Reports by Company and Trustee.
(a) The Company shall furnish to the Holders and to prospective purchasers of Securities, upon
their request, the information required to be furnished pursuant to Rule 144A(d)(4) under the
Securities Act. The Company shall furnish to the Trustee and, so long as the Property Trustee
holds any of the Securities, the Company shall furnish to the Property Trustee, reports on Form FR
Y-9C promptly following their filing with the Federal Reserve.
(b) The Company shall furnish to (i) the Holders, (ii) the Purchaser, (iii) any beneficial
owner of the Securities reasonably identified to the Company (which identification may be made
either by such beneficial owner or by the Placement Agent or the Purchaser) and (iv) any designee
of (i), (ii) or (iii) above, a duly completed and executed certificate in the form attached hereto
as Exhibit A, including the financial statements referenced in such Exhibit, which certificate and
financial statements shall be so furnished by the Company not later than forty five (45) days after
the end of each of the first three fiscal quarters of each fiscal year of the Company and not later
than ninety (90) days after the end of each fiscal year of the Company.
(c) The Trustee shall obtain all reports, certificates and information which it is entitled to
receive under each of the Operative Documents (as defined in the Trust Agreement), and deliver to
(i) the Purchaser, (ii) the Placement Agent and (iii) a designee of (i) or (ii) above, all such
reports, certificates or information promptly upon receipt thereof.
ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
SECTION 8.1.
Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or convey, transfer or
lease its properties and assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(a) if the Company shall consolidate with or merge into another Person or convey, transfer or
lease its properties and assets substantially as an entirety to any Person, the entity formed by
such consolidation or into which the Company is merged or the Person that acquires by conveyance or
transfer, or that leases, the properties and assets of the Company substantially as an entirety
shall be an entity organized and existing under the laws of the United States of America or any
State or Territory thereof or the District of Columbia and shall expressly assume,
50
by an indenture supplemental hereto, executed and delivered to the Trustee, in form reasonably
satisfactory to the Trustee, the due and punctual payment of the principal of and any premium and
interest (including any Additional Interest) on all the Securities and the performance of every
covenant of this Indenture on the part of the Company to be performed or observed;
(b) immediately after giving effect to such transaction, no Event of Default, and no event
that, after notice or lapse of time, or both, would constitute an Event of Default, shall have
happened and be continuing; and
(c) the Company has delivered to the Trustee an Officers Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction, any such supplemental
indenture comply with this
Article VIII
and that all conditions precedent herein provided
for relating to such transaction have been complied with; and the Trustee may rely upon such
Officers Certificate and Opinion of Counsel as conclusive evidence that such transaction complies
with this
Section 8.1
.
SECTION 8.2.
Successor Company Substituted.
(a) Upon any consolidation with or merger by the Company into any other Person, or any
conveyance, transfer or lease by the Company of its properties and assets substantially as an
entirety to any Person in accordance with
Section 8.1
and the execution and delivery to the
Trustee of the supplemental indenture described in
Section 8.1(a)
, the successor entity
formed by such consolidation or into which the Company is merged or to which such conveyance,
transfer or lease is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such successor Person had
been named as the Company herein; and in the event of any such conveyance or transfer, following
the execution and delivery of such supplemental indenture, the Company shall be discharged from all
obligations and covenants under the Indenture and the Securities.
(b) Such successor Person may cause to be executed, and may issue either in its own name or in
the name of the Company, any or all of the Securities issuable hereunder that theretofore shall not
have been signed by the Company and delivered to the Trustee; and, upon the order of such successor
Person instead of the Company and subject to all the terms, conditions and limitations in this
Indenture prescribed, the Trustee shall authenticate and shall deliver any Securities that
previously shall have been signed and delivered by the officers of the Company to the Trustee for
authentication, and any Securities that such successor Person thereafter shall cause to be executed
and delivered to the Trustee on its behalf. All the Securities so issued shall in all respects have
the same legal rank and benefit under this Indenture as the Securities theretofore or thereafter
issued in accordance with the terms of this Indenture.
(c) In case of any such consolidation, merger, sale, conveyance or lease, such changes in
phraseology and form may be made in the Securities thereafter to be issued as may be appropriate to
reflect such occurrence.
51
ARTICLE IX
Supplemental Indentures
SECTION 9.1.
Supplemental Indentures without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more indentures supplemental
hereto, in form reasonably satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company, and the assumption by any
such successor of the covenants of the Company herein and in the Securities; or
(b) to cure any ambiguity, to correct or supplement any provision herein that may be defective
or inconsistent with any other provision herein, or to make any other provisions with respect to
matters or questions arising under this Indenture, which shall not be inconsistent with the other
provisions of this Indenture,
provided
, that such action pursuant to this clause (b) shall not
adversely affect in any material respect the interests of any Holders or the holders of the
Preferred Securities; or
(c) to add to the covenants, restrictions or obligations of the Company or to add to the
Events of Default,
provided
, that such action pursuant to this clause (c) shall not adversely
affect in any material respect the interests of any Holders or the holders of the Preferred
Securities; or
(d) to modify, eliminate or add to any provisions of the Indenture or the Securities to such
extent as shall be necessary to ensure that the Securities are treated as indebtedness of the
Company for United States Federal income tax purposes,
provided
, that such action pursuant to this
clause (d) shall not adversely affect in any material respect the interests of any Holders or the
holders of the Preferred Securities.
SECTION 9.2.
Supplemental Indentures with Consent of Holders.
(a) With the consent of the Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities, by Act of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Indenture or of modifying in any manner the
rights of the Holders of Securities under this Indenture;
provided
, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security,
(i) change the Stated Maturity of the principal or any premium of any Security or
change the date of payment of any installment of interest (including any Additional
Interest) on any Security, or reduce the principal amount thereof or the rate of interest
thereon or any premium payable upon the redemption thereof or change the place of payment
where, or the coin or currency in which, any Security or interest thereon is payable, or
restrict or impair the right to institute suit for the enforcement of any such payment on or
after such date, or
52
(ii) reduce the percentage in aggregate principal amount of the Outstanding Securities,
the consent of whose Holders is required for any such supplemental indenture, or the consent
of whose Holders is required for any waiver of compliance with any provision of this
Indenture or of defaults hereunder and their consequences provided for in this Indenture, or
(iii) modify any of the provisions of this
Section 9.2
,
Section 5.13
or
Section 10.7
, except to increase any percentage in aggregate principal amount of the
Outstanding Securities, the consent of whose Holders is required for any reason, or to
provide that certain other provisions of this Indenture cannot be modified or waived without
the consent of the Holder of each Security;
provided, further,
that, so long as any Preferred Securities remain outstanding, no amendment under
this
Section 9.2
shall be effective until the holders of a majority in Liquidation Amount
(as defined in the Trust Agreement) of the Trust Securities shall have consented to such amendment;
provided, further,
that if the consent of the holder of each Outstanding Security is required for
any amendment under this Indenture, such amendment shall not be effective until the holder of each
Outstanding Trust Security shall have consented to such amendment.
(b) It shall not be necessary for any Act of Holders under this
Section 9.2
to approve
the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.
SECTION 9.3.
Execution of Supplemental Indentures.
In executing or accepting the additional trusts created by any supplemental indenture
permitted by this
Article IX
or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and shall be fully protected in conclusively
relying upon, an Officers Certificate and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture, and that all conditions
precedent herein provided for relating to such action have been complied with. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture that affects the Trustees
own rights, duties, indemnities or immunities under this Indenture or otherwise. Copies of the
final form of each supplemental indenture shall be delivered by the Trustee at the expense of the
Company to each Holder, and, if the Trustee is the Property Trustee, to each holder of Preferred
Securities, promptly after the execution thereof.
SECTION 9.4.
Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article IX
, this Indenture
shall be modified in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities theretofore or thereafter
authenticated and delivered hereunder shall be bound thereby.
SECTION 9.5.
Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental indenture
pursuant to this
Article IX
may, and shall, if required by the Company, bear a notation in
form
53
approved by the Company as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities so modified as to conform, in the opinion of the
Company, to any such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding Securities.
ARTICLE X
Covenants
SECTION 10.1.
Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of the Securities that it will duly and
punctually pay the principal of and any premium and interest (including any Additional Interest) on
the Securities in accordance with the terms of the Securities and this Indenture.
SECTION 10.2.
Money for Security Payments to be Held in Trust.
(a) If the Company shall at any time act as its own Paying Agent with respect to the
Securities, it will, on or before each due date of the principal of and any premium or interest
(including any Additional Interest) on the Securities, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal and any premium or interest
(including Additional Interest) so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and will promptly notify the Trustee in writing of its
failure so to act.
(b) Whenever the Company shall have one or more Paying Agents, it will, prior to 10:00 a.m.,
New York City time, on each due date of the principal of or any premium or interest (including any
Additional Interest) on any Securities, deposit with a Paying Agent a sum sufficient to pay such
amount, such sum to be held as provided in the Trust Indenture Act and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of its failure so to act.
(c) The Company will cause each Paying Agent for the Securities other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the
Trustee, subject to the provisions of this
Section 10.2
, that such Paying Agent will (i)
comply with the provisions of the Trust Indenture Act applicable to it as a Paying Agent and (ii)
during the continuance of any default by the Company (or any other obligor upon the Securities) in
the making of any payment in respect of the Securities, upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for payment in respect of
the Securities.
(d) The Company may at any time, for the purpose of obtaining the satisfaction and discharge
of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to
pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be
held by the Trustee upon the same terms as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent
shall be released from all further liability with respect to such money.
54
(e) Any money deposited with the Trustee or any Paying Agent, or then held by the Company in
trust for the payment of the principal of and any premium or interest (including any Additional
Interest) on any Security and remaining unclaimed for two years after such principal and any
premium or interest has become due and payable shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be paid on Company Request
to the Company, or (if then held by the Company) shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon
cease;
provided
, that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of general circulation in
the Borough of Manhattan, The City of New York, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than thirty (30) days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 10.3.
Statement as to Compliance.
The Company shall deliver to the Trustee, within one hundred and twenty (120) days after the
end of each fiscal year of the Company ending after the date hereof, an Officers Certificate
covering the preceding fiscal year, stating whether or not to the knowledge of the signers thereof
the Company is in default in the performance or observance of any of the terms, provisions and
conditions of this Indenture (without regard to any period of grace or requirement of notice
provided hereunder), and if the Company shall be in default, specifying all such defaults and the
nature and status thereof of which they may have knowledge.
SECTION 10.4.
Calculation Agent.
(a) The Company hereby agrees that for so long as any of the Securities remain Outstanding,
there will at all times be an agent appointed to calculate LIBOR in respect of each Interest
Payment Date in accordance with the terms of
Schedule A
(the
Calculation Agent
). The
Company has initially appointed the Trustee as Calculation Agent for purposes of determining LIBOR
for each Interest Payment Date. The Calculation Agent may be removed by the Company at any time.
So long as the Property Trustee holds any of the Securities, the Calculation Agent shall be the
Property Trustee. If the Calculation Agent is unable or unwilling to act as such or is removed by
the Company, the Company will promptly appoint as a replacement Calculation Agent the London office
of a leading bank which is engaged in transactions in Eurodollar deposits in the international
Eurodollar market and which does not control or is not controlled by or under common control with
the Company or its Affiliates. The Calculation Agent may not resign its duties without a successor
having been duly appointed.
(b) The Calculation Agent shall be required to agree that, as soon as possible after 11:00
a.m. (London time) on each LIBOR Determination Date (as defined in
Schedule A
), but in no
event later than 11:00 a.m. (London time) on the Business Day immediately following each LIBOR
Determination Date, the Calculation Agent will calculate the interest (rounded to the
55
nearest cent, with half a cent being rounded upwards) for the related Interest Payment Date,
and will communicate the rate and amount to the Company, the Trustee, each Paying Agent and the
Depositary. The Calculation Agent will also specify to the Company the quotations upon which the
foregoing rates and amounts are based and, in any event, the Calculation Agent shall notify the
Company before 5:00 p.m. (London time) on each LIBOR Determination Date that either: (i) it has
determined or is in the process of determining the foregoing rates and amounts or (ii) it has not
determined and is not in the process of determining the foregoing rates and amounts, together with
its reasons therefor. The Calculation Agents determination of the foregoing rates and amounts for
any Interest Payment Date will (in the absence of manifest error) be final and binding upon all
parties. For the sole purpose of calculating the interest rate for the Securities, Business Day
shall be defined as any day on which dealings in deposits in Dollars are transacted in the London
interbank market.
SECTION 10.5.
Additional Tax Sums.
So long as no Event of Default has occurred and is continuing, if (a) the Trust is the Holder
of all of the Outstanding Securities and (b) a Tax Event described in clause (i) or (iii) in the
definition of Tax Event in
Section 1.1
hereof has occurred and is continuing, the Company
shall pay to the Trust (and its permitted successors or assigns under the related Trust Agreement)
for so long as the Trust (or its permitted successor or assignee) is the registered holder of the
Outstanding Securities, such amounts as may be necessary in order that the amount of Distributions
(including any Additional Interest Amount (as defined in the Trust Agreement)) then due and payable
by the Trust on the Preferred Securities and Common Securities that at any time remain outstanding
in accordance with the terms thereof shall not be reduced as a result of any Additional Taxes
arising from such Tax Event (additional such amounts payable by the Company to the Trust, the
Additional Tax Sums
). Whenever in this Indenture or the Securities there is a reference in any
context to the payment of principal of or interest on the Securities, such mention shall be deemed
to include mention of the payments of the Additional Tax Sums provided for in this
Section
10.5
to the extent that, in such context, Additional Tax Sums are, were or would be payable in
respect thereof pursuant to the provisions of this
Section 10.5
and express mention of the
payment of Additional Tax Sums (if applicable) in any provisions hereof shall not be construed as
excluding Additional Tax Sums in those provisions hereof where such express mention is not made;
provided
, that the deferral of the payment of interest pursuant to
Section 3.9
on the
Securities shall not defer the payment of any Additional Tax Sums that may be due and payable.
SECTION 10.6.
Additional Covenants.
(a) The Company covenants and agrees with each Holder of Securities that if an Event of
Default shall have occurred and be continuing or the Company shall have given notice of its
election to begin an Extension Period with respect to the Securities and shall not have rescinded
such notice, or such Extension Period, or any extension thereof, shall be continuing, it shall not
(i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any shares of the Companys capital stock, or (ii) make any
payment of principal of or any interest or premium on or repay, repurchase or redeem any debt
securities of the Company that rank
pari passu
in all respects with or junior in interest to the
Securities (other than (A) repurchases, redemptions or other acquisitions of shares of
56
capital stock of the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees, officers, directors or
consultants, in connection with a dividend reinvestment or stockholder stock purchase plan or in
connection with the issuance of capital stock of the Company (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition transaction entered into
prior to the applicable Extension Period, (B) as a result of a reclassification of the Guarantors
capital stock or the exchange or conversion of any class or series of the Companys capital stock
(or any capital stock of a Subsidiary of the Company) for any class or series of the Companys
capital stock or of any class or series of the Companys indebtedness for any class or series of
the Companys capital stock, (C) the purchase of fractional interests in shares of the Companys
capital stock pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (D) any declaration of a dividend or distribution in
connection with any Rights Plan, the issuance of rights, stock or other property under any Rights
Plan or the redemption or repurchase of rights pursuant thereto, or (E) any dividend or
distribution in the form of stock, warrants, options or other rights where the dividend or
distribution stock or the stock issuable upon exercise of such warrants, options or other rights is
the same stock as that on which the dividend or distribution is being paid or ranks
pari passu
with
or junior to such stock).
(b) The Company also covenants with each Holder of Securities (i) to hold, directly or
indirectly, one hundred percent (100%) of the Common Securities of the Trust,
provided
, that any
permitted successor of the Company hereunder may succeed to the Companys ownership of such Common
Securities, (ii) as holder of such Common Securities, not to voluntarily dissolve, wind-up or
liquidate the Trust other than (A) in connection with a distribution of the Securities to the
holders of the Preferred Securities in liquidation of the Trust or (B) in connection with certain
mergers, consolidations or amalgamations permitted by the Trust Agreement and (iii) to use its
reasonable commercial efforts, consistent with the terms and provisions of the Trust Agreement, to
cause the Trust to continue to be taxable as a grantor trust and not as a corporation for United
States Federal income tax purposes.
SECTION 10.7.
Waiver of Covenants.
The Company may omit in any particular instance to comply with any covenant or condition
contained in
Section 10.6
if, before or after the time for such compliance, the Holders of
at least a majority in aggregate principal amount of the Outstanding Securities shall, by Act of
such Holders, and at least a majority of the aggregate Liquidation Amount (as defined in the Trust
Agreement) of the Preferred Securities then outstanding, by consent of such holders, either waive
such compliance in such instance or generally waive compliance with such covenant or condition, but
no such waiver shall extend to or affect such covenant or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations of the Company in
respect of any such covenant or condition shall remain in full force and effect.
SECTION 10.8.
Treatment of Securities.
The Company will treat the Securities as indebtedness, and the amounts payable in respect of
the principal amount of such Securities as interest, for all U.S. federal income tax purposes. All
payments in respect of the Securities will be made free and clear of U.S.
57
withholding tax to any beneficial owner thereof that has provided an Internal Revenue Service
Form W-8BEN (or any substitute or successor form) establishing its non-U.S. status for U.S. federal
income tax purposes.
ARTICLE XI
Redemption of Securities
SECTION 11.1.
Optional Redemption.
The Company may, at its option, on any Interest Payment Date, on or after December 31, 2011,
redeem the Securities in whole at any time or in part from time to time, at a Redemption Price
equal to one hundred percent (100%) of the principal amount thereof (or of the redeemed portion
thereof, as applicable), together, in the case of any such redemption, with accrued interest,
including any Additional Interest, to but excluding the date fixed for redemption;
provided
, that
the Company shall have received the prior approval of the Federal Reserve with respect to such
redemption if then required.
SECTION 11.2.
Special Event Redemption.
Upon the occurrence and during the continuation of a Special Event, the Company may, at its
option, redeem the Securities, in whole but not in part, at a redemption price equal to the
Redemption Price specified in
Section 11.1
above, together, in the case of any such
redemption, with accrued interest, including any Additional Interest, to but excluding the date
fixed for redemption (the Special Event Redemption Price);
provided
, that the Company shall have
received the prior approval of the Federal Reserve with respect to such redemption if then
required.
SECTION 11.3.
Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities, in whole or in part, shall be evidenced
by or pursuant to a Board Resolution. In case of any redemption at the election of the Company,
the Company shall, not less than forty five (45) days and not more than seventy five (75) days
prior to the Redemption Date (unless a shorter notice shall be satisfactory to the Trustee), notify
the Trustee and the Property Trustee under the Trust Agreement in writing of such date and of the
principal amount of the Securities to be redeemed and provide the additional information required
to be included in the notice or notices contemplated by
Section 11.5
. In the case of any
redemption of Securities, in whole or in part, (a) prior to the expiration of any restriction on
such redemption provided in this Indenture or the Securities or (b) pursuant to an election of the
Company which is subject to a condition specified in this Indenture or the Securities, the Company
shall furnish the Trustee with an Officers Certificate and an Opinion of Counsel evidencing
compliance with such restriction or condition.
SECTION 11.4.
Selection of Securities to be Redeemed.
(a) If less than all the Securities are to be redeemed, the particular Securities to be
redeemed shall be selected not more than sixty (60) days prior to the Redemption Date by the
Trustee from the Outstanding Securities not previously called for redemption, by such method as
58
the Trustee shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any or each Security,
provided
, that the
unredeemed portion of the principal amount of any Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such Security.
(b) The Trustee shall promptly notify the Company in writing of the Securities selected for
redemption and, in the case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the case of any Security
redeemed or to be redeemed only in part, to the portion of the principal amount of such Security
that has been or is to be redeemed.
(c) The provisions of paragraphs (a) and (b) of this
Section 11.4
shall not apply with
respect to any redemption affecting only a single Security, whether such Security is to be redeemed
in whole or in part. In the case of any such redemption in part, the unredeemed portion of the
principal amount of the Security shall be in an authorized denomination (which shall not be less
than the minimum authorized denomination) for such Security.
SECTION 11.5.
Notice of Redemption.
(a) Notice of redemption shall be given not later than the thirtieth (30th) day, and not
earlier than the sixtieth (60th) day, prior to the Redemption Date to each Holder of Securities to
be redeemed, in whole or in part (unless a shorter notice shall be satisfactory to the Property
Trustee under the related Trust Agreement).
(b) With respect to Securities to be redeemed, in whole or in part, each notice of redemption
shall state:
(i) the Redemption Date;
(ii) the Redemption Price or, if the Redemption Price cannot be calculated prior to the
time the notice is required to be sent, the estimate of the Redemption Price, as calculated
by the Company, together with a statement that it is an estimate and that the actual
Redemption Price will be calculated on the fifth Business Day prior to the Redemption Date
(and if an estimate is provided, a further notice shall be sent of the actual Redemption
Price on the date that such Redemption Price is calculated);
(iii) if less than all Outstanding Securities are to be redeemed, the identification
(and, in the case of partial redemption, the respective principal amounts) of the particular
Securities to be redeemed;
(iv) that on the Redemption Date, the Redemption Price will become due and payable upon
each such Security or portion thereof, and that any interest (including any Additional
Interest) on such Security or such portion, as the case may be, shall cease to accrue on and
after said date; and
59
(v) the place or places where such Securities are to be surrendered for payment of the
Redemption Price.
(c) Notice of redemption of Securities to be redeemed, in whole or in part, at the election of
the Company shall be given by the Company or, at the Companys request, by the Trustee in the name
and at the expense of the Company and shall be irrevocable. The notice if mailed in the manner
provided above shall be conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any defect in the
notice to the Holder of any Security designated for redemption as a whole or in part shall not
affect the validity of the proceedings for the redemption of any other Security.
SECTION 11.6.
Deposit of Redemption Price.
Prior to 10:00 a.m., New York City time, on the Redemption Date specified in the notice of
redemption given as provided in
Section 11.5
, the Company will deposit with the Trustee or
with one or more Paying Agents (or if the Company is acting as its own Paying Agent, the Company
will segregate and hold in trust as provided in
Section 10.2
) an amount of money sufficient
to pay the Redemption Price of, and any accrued interest (including any Additional Interest) on,
all the Securities (or portions thereof) that are to be redeemed on that date.
SECTION 11.7.
Payment of Securities Called for Redemption.
(a) If any notice of redemption has been given as provided in
Section 11.5
, the
Securities or portion of Securities with respect to which such notice has been given shall become
due and payable on the date and at the place or places stated in such notice at the applicable
Redemption Price, together with accrued interest (including any Additional Interest) to the
Redemption Date. On presentation and surrender of such Securities at a Place of Payment specified
in such notice, the Securities or the specified portions thereof shall be paid and redeemed by the
Company at the applicable Redemption Price, together with accrued interest (including any
Additional Interest) to the Redemption Date.
(b) Upon presentation of any Security redeemed in part only, the Company shall execute and the
Trustee shall authenticate and deliver to the Holder thereof, at the expense of the Company, a new
Security or Securities, of authorized denominations, in aggregate principal amount equal to the
unredeemed portion of the Security so presented and having the same Original Issue Date, Stated
Maturity and terms.
(c) If any Security called for redemption shall not be so paid upon surrender thereof for
redemption, the principal of and any premium on such Security shall, until paid, bear interest from
the Redemption Date at the rate prescribed therefor in the Security.
60
ARTICLE XII
Subordination of Securities
SECTION 12.1.
Securities Subordinate to Senior Debt.
The Company covenants and agrees, and each Holder of a Security, by its acceptance thereof,
likewise covenants and agrees, that, to the extent and in the manner hereinafter set forth in this
Article XII
, the payment of the principal of and any premium and interest (including any
Additional Interest) on each and all of the Securities are hereby expressly made subordinate and
subject in right of payment to the prior payment in full of all Senior Debt.
SECTION 12.2.
No Payment When Senior Debt in Default; Payment Over of Proceeds upon
Dissolution, Etc.
(a) In the event and during the continuation of any default by the Company in the payment of
any principal of or any premium or interest on any Senior Debt (following any grace period, if
applicable) when the same becomes due and payable, whether at maturity or at a date fixed for
prepayment or by declaration of acceleration or otherwise, then, upon written notice of such
default to the Company by the holders of such Senior Debt or any trustee therefor, unless and until
such default shall have been cured or waived or shall have ceased to exist, no direct or indirect
payment (in cash, property, securities, by set-off or otherwise) shall be made or agreed to be made
on account of the principal of or any premium or interest (including any Additional Interest) on
any of the Securities, or in respect of any redemption, repayment, retirement, purchase or other
acquisition of any of the Securities.
(b) In the event of a bankruptcy, insolvency or other proceeding described in clause (e) or
(f) of the definition of Event of Default (each such event, if any, herein sometimes referred to as
a
Proceeding
), all Senior Debt (including any interest thereon accruing after the commencement of
any such proceedings) shall first be paid in full before any payment or distribution, whether in
cash, securities or other property, shall be made to any Holder of any of the Securities on account
thereof. Any payment or distribution, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the Securities, to the
payment of all Senior Debt at the time outstanding and to any securities issued in respect thereof
under any such plan of reorganization or readjustment), which would otherwise (but for these
subordination provisions) be payable or deliverable in respect of the Securities shall be paid or
delivered directly to the holders of Senior Debt in accordance with the priorities then existing
among such holders until all Senior Debt (including any interest thereon accruing after the
commencement of any Proceeding) shall have been paid in full.
(c) In the event of any Proceeding, after payment in full of all sums owing with respect to
Senior Debt, the Holders of the Securities, together with the holders of any obligations of the
Company ranking on a parity with the Securities, shall be entitled to be paid from the remaining
assets of the Company the amounts at the time due and owing on account of unpaid principal of and
any premium and interest (including any Additional Interest) on the Securities
61
and such other obligations before any payment or other distribution, whether in cash, property
or otherwise, shall be made on account of any capital stock or any obligations of the Company
ranking junior to the Securities and such other obligations. If, notwithstanding the foregoing, any
payment or distribution of any character or any security, whether in cash, securities or other
property (other than securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to the extent provided
in these subordination provisions with respect to the indebtedness evidenced by the Securities, to
the payment of all Senior Debt at the time outstanding and to any securities issued in respect
thereof under any such plan of reorganization or readjustment) shall be received by the Trustee or
any Holder in contravention of any of the terms hereof and before all Senior Debt shall have been
paid in full, such payment or distribution or security shall be received in trust for the benefit
of, and shall be paid over or delivered and transferred to, the holders of the Senior Debt at the
time outstanding in accordance with the priorities then existing among such holders for application
to the payment of all Senior Debt remaining unpaid, to the extent necessary to pay all such Senior
Debt (including any interest thereon accruing after the commencement of any Proceeding) in full. In
the event of the failure of the Trustee or any Holder to endorse or assign any such payment,
distribution or security, each holder of Senior Debt is hereby irrevocably authorized to endorse or
assign the same.
(d) The Trustee and the Holders, at the expense of the Company, shall take such reasonable
action (including the delivery of this Indenture to an agent for any holders of Senior Debt or
consent to the filing of a financing statement with respect hereto) as may, in the opinion of
counsel designated by the holders of a majority in principal amount of the Senior Debt at the time
outstanding, be necessary or appropriate to assure the effectiveness of the subordination effected
by these provisions.
(e) The provisions of this
Section 12.2
shall not impair any rights, interests,
remedies or powers of any secured creditor of the Company in respect of any security interest the
creation of which is not prohibited by the provisions of this Indenture.
(f) The securing of any obligations of the Company, otherwise ranking on a parity with the
Securities or ranking junior to the Securities, shall not be deemed to prevent such obligations
from constituting, respectively, obligations ranking on a parity with the Securities or ranking
junior to the Securities.
SECTION 12.3.
Payment Permitted If No Default.
Nothing contained in this
Article XII
or elsewhere in this Indenture or in any of the
Securities shall prevent (a) the Company, at any time, except during the pendency of the conditions
described in paragraph (a) of
Section 12.2
or of any Proceeding referred to in
Section
12.2
, from making payments at any time of principal of and any premium or interest (including
any Additional Interest) on the Securities or (b) the application by the Trustee of any moneys
deposited with it hereunder to the payment of or on account of the principal of and any premium or
interest (including any Additional Interest) on the Securities or the retention of such payment by
the Holders, if, at the time of such application by the Trustee, it did not have knowledge (in
accordance with
Section 12.8
) that such payment would have been prohibited by the
provisions of this
Article XII
, except as provided in
Section 12.8
.
62
SECTION 12.4.
Subrogation to Rights of Holders of Senior Debt.
Subject to the payment in full of all amounts due or to become due on all Senior Debt, or the
provision for such payment in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, the Holders of the Securities shall be subrogated to the extent of the
payments or distributions made to the holders of such Senior Debt pursuant to the provisions of
this
Article XII
(equally and ratably with the holders of all indebtedness of the Company
that by its express terms is subordinated to Senior Debt of the Company to substantially the same
extent as the Securities are subordinated to the Senior Debt and is entitled to like rights of
subrogation by reason of any payments or distributions made to holders of such Senior Debt) to the
rights of the holders of such Senior Debt to receive payments and distributions of cash, property
and securities applicable to the Senior Debt until the principal of and any premium and interest
(including any Additional Interest) on the Securities shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of the Senior Debt of any cash, property
or securities to which the Holders of the Securities or the Trustee would be entitled except for
the provisions of this
Article XII
, and no payments made pursuant to the provisions of this
Article XII
to the holders of Senior Debt by Holders of the Securities or the Trustee,
shall, as among the Company, its creditors other than holders of Senior Debt, and the Holders of
the Securities, be deemed to be a payment or distribution by the Company to or on account of the
Senior Debt.
SECTION 12.5.
Provisions Solely to Define Relative Rights.
The provisions of this
Article XII
are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities on the one hand and the holders of
Senior Debt on the other hand. Nothing contained in this
Article XII
or elsewhere in this
Indenture or in the Securities is intended to or shall (a) impair, as between the Company and the
Holders of the Securities, the obligations of the Company, which are absolute and unconditional, to
pay to the Holders of the Securities the principal of and any premium and interest (including any
Additional Interest) on the Securities as and when the same shall become due and payable in
accordance with their terms, (b) affect the relative rights against the Company of the Holders of
the Securities and creditors of the Company other than their rights in relation to the holders of
Senior Debt or (c) prevent the Trustee or the Holder of any Security (or to the extent expressly
provided herein, the holder of any Preferred Security) from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, including filing and voting claims
in any Proceeding, subject to the rights, if any, under this
Article XII
of the holders of
Senior Debt to receive cash, property and securities otherwise payable or deliverable to the
Trustee or such Holder.
SECTION 12.6.
Trustee to Effectuate Subordination.
Each Holder of a Security by his or her acceptance thereof authorizes and directs the Trustee
on his or her behalf to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination provided in this
Article XII
and appoints the Trustee his or
her attorney-in-fact for any and all such purposes.
63
SECTION 12.7.
No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Debt to enforce subordination as
herein provided shall at any time in any way be prejudiced or impaired by any act or failure to act
on the part of the Company or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or be otherwise charged with.
(b) Without in any way limiting the generality of paragraph (a) of this
Section 12.7
,
the holders of Senior Debt may, at any time and from to time, without the consent of or notice to
the Trustee or the Holders of the Securities, without incurring responsibility to such Holders of
the Securities and without impairing or releasing the subordination provided in this
Article
XII
or the obligations hereunder of such Holders of the Securities to the holders of Senior
Debt, do any one or more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior Debt, or otherwise amend or supplement in
any manner Senior Debt or any instrument evidencing the same or any agreement under which Senior
Debt is outstanding, (ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Debt, (iii) release any Person liable in any manner for the
payment of Senior Debt and (iv) exercise or refrain from exercising any rights against the Company
and any other Person.
SECTION 12.8.
Notice to Trustee.
(a) The Company shall give prompt written notice to a Responsible Officer of the Trustee of
any fact known to the Company that would prohibit the making of any payment to or by the Trustee in
respect of the Securities. Notwithstanding the provisions of this
Article XII
or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until a Responsible Officer of the Trustee shall have received written
notice thereof from the Company or a holder of Senior Debt or from any trustee, agent or
representative therefor;
provided
, that if the Trustee shall not have received the notice provided
for in this
Section 12.8
at least two Business Days prior to the date upon which by the
terms hereof any monies may become payable for any purpose (including, the payment of the principal
of and any premium on or interest (including any Additional Interest) on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such monies and to apply the same to the purpose for which they were received
and shall not be affected by any notice to the contrary that may be received by it within two
Business Days prior to such date.
(b) The Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself or herself to be a holder of Senior Debt (or a trustee, agent,
representative or attorney-in-fact therefor) to establish that such notice has been given by a
holder of Senior Debt (or a trustee, agent, representative or attorney-in-fact therefor). In the
event that the Trustee determines in good faith that further evidence is required with respect to
the right of any Person as a holder of Senior Debt to participate in any payment or distribution
pursuant to this
Article XII
, the Trustee may request such Person to furnish evidence to
the
64
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by such Person,
the extent to which such Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this
Article XII
, and if such
evidence is not furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
SECTION 12.9.
Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to in this
Article
XII
, the Trustee and the Holders of the Securities shall be entitled to conclusively rely upon
any order or decree entered by any court of competent jurisdiction in which such Proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, liquidating trustee, custodian,
assignee for the benefit of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of the Senior Debt and
other indebtedness of the Company, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent thereto or to this
Article XII
.
SECTION 12.10.
Trustee Not Fiduciary for Holders of Senior Debt.
The Trustee, in its capacity as trustee under this Indenture, shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt and shall not be liable to any such holders if it
shall in good faith mistakenly pay over or distribute to Holders of Securities or to the Company or
to any other Person cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this
Article XII
or otherwise.
SECTION 12.11.
Rights of Trustee as Holder of Senior Debt; Preservation of Trustees Rights.
The Trustee in its individual capacity shall be entitled to all the rights set forth in this
Article XII
with respect to any Senior Debt that may at any time be held by it, to the same
extent as any other holder of Senior Debt, and nothing in this Indenture shall deprive the Trustee
of any of its rights as such holder.
SECTION 12.12.
Article Applicable to Paying Agents.
If at any time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term
Trustee
as used in this
Article XII
shall
in such case (unless the context otherwise requires) be construed as extending to and including
such Paying Agent within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this
Article XII
in addition to or in place of the Trustee;
provided
, that
Sections
12.8
and
12.11
shall not apply to the Company or any Affiliate of
the Company if the Company or such Affiliate acts as Paying Agent.
This instrument may be executed in any number of counterparts, each of which so executed shall
be deemed to be an original, but all such counterparts shall together constitute but one and the
same instrument.
65
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of
the day and year first above written.
|
|
|
|
|
|
TEXAS CAPITAL BANCSHARES, INC.
|
|
|
By:
|
/s/ Peter Bartholow
|
|
|
|
Name:
|
Peter Bartholow
|
|
|
|
Title:
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
WILMINGTON TRUST COMPANY, not in its individual
capacity, but solely as Trustee
|
|
|
By:
|
/s/ Christopher J. Slaybaugh
|
|
|
|
Name:
|
Christopher J. Slaybaugh
|
|
|
|
Title:
|
Senior Financial Services Officer
|
|
|
67
Schedule A
DETERMINATION OF LIBOR
With respect to the Securities, the London interbank offered rate (
LIBOR
) shall be
determined by the Calculation Agent in accordance with the following provisions (in each case
rounded to the nearest .000001%):
(1) On the second LIBOR Business Day (as defined below) prior to an Interest Payment Date (except,
with respect to the first Interest Payment Date, on September 27, 2006) (each such day, a LIBOR
Determination Date), LIBOR for any given security shall, for the next quarterly interest period,
equal the rate, as obtained by the Calculation Agent from Bloomberg Financial Markets Commodities
News, for three-month U.S. Dollar deposits in Europe, which appears on Dow Jones Telerate Page 3750
(as defined in the International Swaps and Derivatives Association, Inc. 1991 Interest Rate and
Currency Exchange Definitions), or such other page as may replace such Page 3750, as of 11:00 a.m.
(London time) on such LIBOR Determination Date.
(2) If, on any LIBOR Determination Date, such rate does not appear on Dow Jones Telerate Page 3750
or such other page as may replace such Page 3750, the Calculation Agent shall determine the
arithmetic mean of the offered quotations of the Reference Banks (as defined below) to leading
banks in the London interbank market for three-month U.S. Dollar deposits in Europe in an amount
determined by the Calculation Agent by reference to requests for quotations as of approximately
11:00 a.m. (London time) on the LIBOR Determination Date made by the Calculation Agent to the
Reference Banks. If, on any LIBOR Determination Date, at least two of the Reference Banks provide
such quotations, LIBOR shall equal such arithmetic mean of such quotations. If, on any LIBOR
Determination Date, only one or none of the Reference Banks provide such quotations, LIBOR shall be
deemed to be the arithmetic mean of the offered quotations that leading banks in the City of New
York selected by the Calculation Agent are quoting on the relevant LIBOR Determination Date for
three-month U.S. Dollar deposits in Europe in an amount determined by the Calculation Agent by
reference to the principal London offices of leading banks in the London interbank market;
provided
that, if the Calculation Agent is required but is unable to determine a rate in accordance with at
least one of the procedures provided above, LIBOR shall be LIBOR as determined on the previous
LIBOR Determination Date.
(3) As used herein:
Reference Banks
means four major banks in the London interbank market
selected by the Calculation Agent; and
LIBOR Business Day
means a day on which commercial banks
are open for business (including dealings in foreign exchange and foreign currency deposits) in
London.
Schedule A-1
Exhibit A
Officers Certificate
The undersigned, the [Chief Financial Officer] [Treasurer] [Executive Vice President] hereby
certifies, pursuant to Section 7.3(b) of the Junior Subordinated Indenture, dated as of September
29, 2006, between Texas Capital Bancshares, Inc. (the Company) and Wilmington Trust Company, as
trustee, that, as of [date], [20___], the Company had the following ratios and balances:
BANK HOLDING COMPANY
As of [Quarterly Financial Dates]
|
|
|
|
|
Tier 1 Risk Weighted Assets
|
|
|
|
%
|
|
|
|
|
Ratio of Double Leverage
|
|
|
|
%
|
|
|
|
|
Non-Performing Assets to Loans and OREO
|
|
|
|
%
|
|
|
|
|
Tangible Common Equity as a Percentage of Tangible Assets
|
|
|
|
%
|
|
|
|
|
Ratio of Reserves to Non-Performing Loans
|
|
|
|
%
|
|
|
|
|
Ratio of Net Charge-Offs to Loans
|
|
|
|
%
|
|
|
|
|
Return on Average Assets (annualized)
|
|
|
|
%
|
|
|
|
|
Net Interest Margin (annualized)
|
|
|
|
%
|
|
|
|
|
Efficiency Ratio
|
|
|
|
%
|
|
|
|
|
Ratio of Loans to Assets
|
|
|
|
%
|
|
|
|
|
Ratio of Loans to Deposits
|
|
|
|
%
|
|
|
|
|
Total Assets
|
|
$
|
|
|
|
|
|
|
Year to Date Income
|
|
$
|
|
|
|
|
|
|
|
|
|
*
|
|
A table describing the quarterly report calculation procedures is provided on page ___
|
[
FOR FISCAL YEAR END
: Attached hereto are the audited consolidated financial statements
(including the balance sheet, income statement and statement of cash flows, and notes thereto,
together with the report of the independent accountants thereon) of the Company and its
consolidated subsidiaries for the three years ended ___, 20___.]
[
FOR FISCAL QUARTER END
: Attached hereto are the unaudited consolidated and consolidating financial
statements (including the balance sheet and income statement) of the Company and its consolidated
subsidiaries for the fiscal quarter] ended [date], 20___.
The financial statements fairly present in all material respects, in accordance with U.S. generally
accepted accounting principles (GAAP), the financial position of the Company and its consolidated
subsidiaries, and the results of operations and changes in financial condition as of the date, and
for the [___quarter interim] [annual] period ended [date], 20___, and such financial
Ex. A-1
Exhibit A
statements have been prepared in accordance with GAAP consistently applied throughout the period
involved (except as otherwise noted therein).
IN WITNESS WHEREOF, the undersigned has executed this Officers Certificate as of this ___
day of ___, 20___
|
|
|
|
|
|
|
|
Name:
|
|
|
Title:
|
|
|
|
|
|
Texas Capital Bancshares, Inc.
|
|
|
2100 McKinney Avenue, Suite 900
|
|
|
Dallas, Texas 75201
|
|
|
(214) 932-6775
|
Ex. A-2
Financial Definitions
|
|
|
|
|
|
|
Corresponding FRY-9C or LP Line Items with Line
|
|
|
Report Item
|
|
Item corresponding Schedules
|
|
Description of Calculation
|
Tier 1 Risk
Weighted Assets
|
|
BHCK7206
Schedule HC-R
|
|
Tier 1 Risk Ratio: Core
Capital (Tier 1)/Risk-Adjusted
Assets
|
|
|
|
|
|
Ratio of Double
Leverage
|
|
(BHCP0365)/(BCHCP3210)
Schedule PC in the LP
|
|
Total equity investments
in subsidiaries divided by
the total equity capital.
This field is calculated
at the parent company
level. Subsidiaries
include bank, bank holding
company, and non-bank
subsidiaries.
|
|
|
|
|
|
Non-Performing
Assets to Loans and
OREO
|
|
(BHCK5525-BHCK3506+BHCK5526-BHCK
3507+BHCK2744)/(BHCK2122+BHCK2744)
Schedules HC-C, HC-M & HC-N
|
|
Total Nonperforming Assets
(NPLs+Foreclosed Real
Estate+Other Nonaccrual &
Repossessed Assets)/Total
Loans+Foreclosed Real
Estate
|
|
|
|
|
|
Tangible Common
Equity as a
Percentage of
Tangible Assets
|
|
(BHDM3210-BHCK3163)/(BHCK2170-BHCK3163)
Schedule HC
|
|
(Equity Capital -
Goodwill)/(Total Assets -
Goodwill)
|
|
|
|
|
|
Ratio of Reserves
to Non-Performing
Loans
|
|
(BHCK3123+BHCK3128)/(BHCK5525-
BHCK3506+BHCK5526-BHCK3507)
Schedules HC & HC-N & HC-R
|
|
Total Loan Loss and
Allocated Transfer Risk
Reserves/ Total
Nonperforming Loans
(Nonaccrual + Restructured)
|
|
|
|
|
|
Ratio of Net
Charge-Offs to
Loans
|
|
(BHCK4635-BHCK4605)/(BHCK3516)
Schedules HC-B & HC-K
|
|
Net charge offs for the
period as a percentage of
average loans.
|
|
|
|
|
|
Return on Average
Assets (annualized)
|
|
(BHCK4340/BHCK3368)
Schedules HI & HC-K
|
|
Net Income as a percentage
of Assets.
|
|
|
|
|
|
Net Interest Margin
(annualized)
|
|
(BHCK4519)/(BHCK3515+BHCK3365+BHCK3516
+BHCK3401+BHCKB985)
Schedules HI Memorandum and HC-K
|
|
(Net Interest Income Fully
Taxable Equivalent, if
available/Average Earning
Assets)
|
|
|
|
|
|
Efficiency Ratio
|
|
(BHCK4093)/(BHCK4519+BHCK4079)
Schedule HI
|
|
(Non-interest
Expense)/(Net Interest
Income Fully Taxable
Equivalent, if available,
plus Non-interest Income)
|
|
|
|
|
|
Ratio of Loans to
Assets
|
|
(BHCKB528+BHCK5369)/(BHCK2170)
Schedule HC
|
|
Total Loans & Leases (Net
of Unearned Income & Gross
of Reserve)/Total Assets
|
|
|
|
|
|
Ratio of Loans to
Deposits
|
|
(BHCKB528+BHCK5369)/(BHDM6631+BHDM6636
+BHFN6631+BHFN6636)
Schedule HC
|
|
Total Loans & Leases (Net
of Unearned Income & Gross
of Reserve)/Total Deposits
(Includes Domestic and
Foreign Deposits)
|
1
|
|
|
|
|
|
|
Corresponding FRY-9C or LP Line Items with Line
|
|
|
Report Item
|
|
Item corresponding Schedules
|
|
Description of Calculation
|
Total Assets
|
|
(BHCK2170)
Schedule HC
|
|
The sum of total assets.
Includes cash and balances
due from depository
institutions; securities;
federal funds sold and
securities purchased under
agreements to resell;
loans and lease financing
receivables; trading
assets; premises and fixed
assets; other real estate
owned; investments in
unconsolidated
subsidiaries and
associated companies;
customers liability on
acceptances outstanding;
intangible assets; and
other assets.
|
|
|
|
|
|
Net Income
|
|
(BHCK4300)
Schedule HI
|
|
The sum of income (loss)
before extraordinary items
and other adjustments and
extraordinary items; and
other adjustments, net of
income taxes.
|
2
Financial Definitions
THRIFT HOLDING COMPANY
|
|
|
|
|
|
|
|
|
Description of
|
Report Item
|
|
Corresponding TFR
|
|
Calculation
|
Tier I Risk
Weighted
Assets -
|
|
Schedule CCR Consolidated Capital Requirement
CCR 830
|
|
Tier 1 Risk Ratio: Core
Capital (Tier
1)/Risk-adjusted assets
|
|
|
|
|
|
Ratio of Double
Leverage
|
|
Not applicable
|
|
Not applicable
|
|
|
|
|
|
Non-performing
assets to loans and
OREO
|
|
Schedule PD Consolidated Past Due and Nonaccrual
Schedule SC Consolidated Statement of Condition
PD30/(SC23+SC30+SC34+SC40)
|
|
Total Non-performing
assets (NPLs +
Foreclosed Real
Estate+Other Non-accrual
& Repossessed
assets+Foreclosed Real
Estate)
|
|
|
|
|
|
Tangible Common
Equity as a
Percentage of Total
Assets
|
|
Schedule CCR
CCR 840
|
|
(Equity
Capital-Goodwill) /
(Total assets -
Goodwill)
|
|
|
|
|
|
Ratio of Reserves
to Non-performing
loans
|
|
SC283/PD30
|
|
Total loan loss reserves
/ Total Non-performing
loans
|
|
|
|
|
|
Ratio of Net
Charge-offs to
Loans
|
|
Schedule VA Consolidated Valuation Allowances
and
Related Data
(VA155-VA135)/(SC23+SC30+SC34)
|
|
Net charge offs for the
period as a percentage
of average loans
|
|
|
|
|
|
Return on Assets
(annualized)
|
|
Schedule SO Consolidated Statements of Operations
SO91/SC60
|
|
Net income as a
percentage of assets
|
|
|
|
|
|
Net interest margin
(annualized)
|
|
SO311/((SC10-SC110)+SC20+SC23+SC30+SC34)
|
|
Net interest income /Average
earning assets
|
|
|
|
|
|
Efficiency Ratio
|
|
(SO51/(SO311+SO40))
|
|
(Non-interest expense) /
(Net interest income +
Non-interest income)
|
|
|
|
|
|
Ratio of Loans to
Assets
|
|
(SC23+SC30+SC34)/(SC60)
|
|
Total Loan & Leases /Total
assets
|
|
|
|
|
|
Ratio of Loans to
Deposits
|
|
(SC23+SC30+SC34)/(SC710)
|
|
Total Loans & Leases /Total
Deposits
|
|
|
|
|
|
Total Assets
|
|
Schedule SC
SC60
|
|
The sum of total assets.
|
|
|
|
|
|
Net Income
|
|
Schedule SO
SO91
|
|
The sum of income (loss).
|
3
GUARANTEE AGREEMENT
between
TEXAS CAPITAL BANCSHARES, INC.,
As Guarantor,
and
WILMINGTON TRUST COMPANY,
As Guarantee Trustee
Dated as of September 29, 2006
TEXAS CAPITAL STATUTORY TRUST V
TABLE OF CONTENTS
|
|
|
|
|
|
|
ARTICLE I
|
|
INTERPRETATION AND DEFINITIONS
|
|
|
2
|
|
SECTION 1.1
|
|
Interpretation
|
|
|
2
|
|
SECTION 1.2
|
|
Definitions
|
|
|
2
|
|
|
|
|
|
|
|
|
ARTICLE II
|
|
REPORTS
|
|
|
6
|
|
SECTION 2.1
|
|
List of Holders
|
|
|
6
|
|
SECTION 2.2
|
|
Periodic Reports to the Guarantee Trustee
|
|
|
6
|
|
SECTION 2.3
|
|
Event of Default; Waiver
|
|
|
6
|
|
SECTION 2.4
|
|
Event of Default; Notice
|
|
|
6
|
|
|
|
|
|
|
|
|
ARTICLE III
|
|
POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
|
|
|
7
|
|
SECTION 3.1
|
|
Powers and Duties of the Guarantee Trustee
|
|
|
7
|
|
SECTION 3.2
|
|
Certain Rights of the Guarantee Trustee
|
|
|
8
|
|
SECTION 3.3
|
|
Compensation
|
|
|
10
|
|
SECTION 3.4
|
|
Indemnity
|
|
|
10
|
|
SECTION 3.5
|
|
Securities
|
|
|
11
|
|
|
|
|
|
|
|
|
ARTICLE IV
|
|
GUARANTEE TRUSTEE
|
|
|
11
|
|
SECTION 4.1
|
|
Guarantee Trustee; Eligibility
|
|
|
11
|
|
SECTION 4.2
|
|
Appointment, Removal and Resignation of the Guarantee Trustee
|
|
|
11
|
|
|
|
|
|
|
|
|
ARTICLE V
|
|
GUARANTEE
|
|
|
12
|
|
SECTION 5.1
|
|
Guarantee
|
|
|
12
|
|
SECTION 5.2
|
|
Waiver of Notice and Demand
|
|
|
13
|
|
SECTION 5.3
|
|
Obligations Not Affected
|
|
|
13
|
|
SECTION 5.4
|
|
Rights of Holders
|
|
|
14
|
|
SECTION 5.5
|
|
Guarantee of Payment
|
|
|
14
|
|
SECTION 5.6
|
|
Subrogation
|
|
|
14
|
|
SECTION 5.7
|
|
Independent Obligations
|
|
|
14
|
|
SECTION 5.8
|
|
Enforcement
|
|
|
15
|
|
|
|
|
|
|
|
|
ARTICLE VI
|
|
COVENANTS AND SUBORDINATION
|
|
|
15
|
|
SECTION 6.1
|
|
Dividends, Distributions and Payments
|
|
|
15
|
|
SECTION 6.2
|
|
Subordination
|
|
|
16
|
|
SECTION 6.3
|
|
Pari Passu
Guarantees
|
|
|
16
|
|
|
|
|
|
|
|
|
ARTICLE VII
|
|
TERMINATION
|
|
|
16
|
|
SECTION 7.1
|
|
Termination
|
|
|
16
|
|
|
|
|
|
|
|
|
ARTICLE VIII
|
|
MISCELLANEOUS
|
|
|
17
|
|
SECTION 8.1
|
|
Successors and Assigns
|
|
|
17
|
|
SECTION 8.2
|
|
Amendments
|
|
|
17
|
|
SECTION 8.3
|
|
Notices
|
|
|
17
|
|
SECTION 8.4
|
|
Benefit
|
|
|
18
|
|
i
|
|
|
|
|
|
|
SECTION 8.5
|
|
Governing Law
|
|
|
18
|
|
SECTION 8.6
|
|
Submission to Jurisdiction
|
|
|
18
|
|
SECTION 8.7
|
|
Counterparts
|
|
|
19
|
|
ii
Guarantee Agreement
, dated as of September 29, 2006, executed and delivered by
Texas Capital Bancshares, Inc.
, a Delaware corporation (the
Guarantor
) having its
principal office at 2100 McKinney Avenue, Suite 900, Dallas, Texas 75201, and
Wilmington Trust
Company
, a Delaware banking corporation, as trustee (in such capacity, the
Guarantee
Trustee
), for the benefit of the Holders (as defined herein) from time to time of the Preferred
Securities (as defined herein) of Texas Capital Statutory Trust V, a Delaware statutory trust (the
Issuer
).
W i t n e s s e t h :
Whereas
, pursuant to an Amended and Restated Trust Agreement, dated as of the date
hereof (the
Trust Agreement
), among the Guarantor, as Depositor, the Property Trustee, the
Delaware Trustee and the Administrative Trustees named therein and the Holders from time to time of
the Preferred Securities (as hereinafter defined), the Issuer is issuing $40,000,000 aggregate
Liquidation Amount (as defined in the Trust Agreement) of its Floating Rate Preferred Securities
(Liquidation Amount $1,000 per preferred security) (the
Preferred Securities
) representing
preferred undivided beneficial interests in the assets of the Issuer and having the terms set forth
in the Trust Agreement;
Whereas
, the Preferred Securities will be issued by the Issuer and the proceeds
thereof, together with the proceeds from the issuance of the Issuers Common Securities (as defined
below), will be used to purchase the Notes (as defined in the Trust Agreement) of the Guarantor;
and
Whereas,
as incentive for the Holders to purchase the Preferred Securities, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set forth herein, to pay
to the Holders of the Preferred Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein.
Now, Therefore,
in consideration of the purchase by each Holder of Preferred
Securities, which purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor
executes and delivers this Guarantee Agreement to provide as follows for the benefit of the Holders
from time to time of the Preferred Securities:
ARTICLE I
Interpretation and Definitions
SECTION 1.1
Interpretation.
In this Guarantee Agreement, unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not defined in the preamble
hereof have the respective meanings assigned to them in
Section 1.2
;
(b) the words include, includes and including shall be deemed to be followed by
the phrase without limitation;
(c) all references to the Guarantee Agreement or this Guarantee Agreement are to
this Guarantee Agreement as modified, supplemented or amended from time to time;
(d) all references in this Guarantee Agreement to Articles and Sections are to
Articles and Sections of this Guarantee Agreement unless otherwise specified;
(e) the words hereby, herein, hereof and hereunder and other words of similar
import refer to this Guarantee Agreement as a whole and not to any particular Article,
Section or other subdivision;
(f) a reference to the singular includes the plural and vice versa; and
(g) a reference to the masculine, feminine or neuter gender herein shall include all
of the masculine, feminine and neuter genders.
SECTION 1.2
Definitions
.
As used in this Guarantee Agreement, the terms set forth below shall, unless the context
otherwise requires, have the following meanings:
Affiliate
of any specified Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with such specified
Person;
provided
, that the Issuer shall not be deemed to be an Affiliate of the Guarantor.
For the purposes of this definition,
control
when used with respect to any specified
Person means the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or otherwise;
and the terms
controlling
and
controlled
have meanings correlative to the foregoing.
Beneficiaries
means any Person to whom the Issuer is or hereafter becomes indebted
or liable.
2
Board of Directors
means either the board of directors of the Guarantor or any duly
authorized committee of that board.
Common Securities
means the securities representing common undivided beneficial
interests in the assets of the Issuer.
Debt
means with respect to any Person, whether recourse is to all or a portion of
the assets of such Person, whether currently existing or hereafter incurred, and whether or
not contingent and without duplication, (i) every obligation of such Person for money
borrowed; (ii) every obligation of such Person evidenced by bonds, debentures, notes or
other similar instruments, including obligations incurred in connection with the
acquisition of property, assets or businesses; (iii) every reimbursement obligation of such
Person with respect to letters of credit, bankers acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or assumed as
the deferred purchase price of property or services (but excluding trade accounts payable
arising in the ordinary course of business); (v) every capital lease obligation of such
Person; (vi) all indebtedness of such Person, whether incurred on or prior to the date of
this Guarantee Agreement or thereafter incurred, for claims in respect of derivative
products, including interest rate, foreign exchange rate and commodity forward contracts,
options, swaps and similar arrangements; (vii) every obligation of the type referred to in
clauses (i) through (vi) of another Person and all dividends of another Person the payment
of which, in either case, such Person has guaranteed or is responsible or liable for,
directly or indirectly, as obligor or otherwise; and (viii) any renewals, extensions,
refundings, amendments or modifications of any obligation of the type referred to in
clauses (i) through (vii).
Event of Default
means a default by the Guarantor on any of its payment or other
obligations under this Guarantee Agreement; provided, that except with respect to a default
in payment of any Guarantee Payments, the Guarantor shall have received notice of default
from the Guarantee Trustee and shall not have cured such default within thirty (30) days
after receipt of such notice.
Guarantee Payments
means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or made by or
on behalf of the Issuer: (i) any accumulated and unpaid Distributions (as defined in the
Trust Agreement) required to be paid on the Preferred Securities, to the extent the Issuer
shall have funds on hand available therefor at such time, (ii) the Redemption Price (as
defined in the Trust Agreement) with respect to any Preferred Securities to the extent the
Issuer shall have funds on hand available therefor at such time, and (iii) upon a voluntary
or involuntary termination, winding up or liquidation of the Issuer, unless Notes are
distributed to the Holders, the lesser of (a) the aggregate of the Liquidation Amount of
$1,000 per Preferred Security plus accumulated and unpaid Distributions on the Preferred
Securities to the date of payment, to the extent that
3
the Issuer shall have funds available therefor at such time and (b) the amount of
assets of the Issuer remaining available for distribution to Holders in liquidation of the
Issuer after satisfaction of liabilities to creditors of the Issuer in accordance with
applicable law (in either case, the
Liquidation Distribution
).
Guarantee Trustee
means Wilmington Trust Company, until a Successor Guarantee
Trustee, as defined below, has been appointed and has accepted such appointment pursuant to
the terms of this Guarantee Agreement, and thereafter means each such Successor Guarantee
Trustee.
Holder
means any holder, as registered on the books and records of the Issuer, of
any Preferred Securities;
provided
, that, in determining whether the holders of the
requisite percentage of Preferred Securities have given any request, notice, consent or
waiver hereunder, Holder shall not include the Guarantor, the Guarantee Trustee or any
Affiliate of the Guarantor or the Guarantee Trustee.
Indenture
means the Junior Subordinated Indenture, dated as of the date hereof, as
supplemented and amended, between the Guarantor and Wilmington Trust Company, as trustee.
List of Holders
has the meaning specified in
Section 2.1.
Majority in Liquidation Amount of the Preferred Securities
means a vote by the
Holder(s), voting separately as a class, of more than fifty percent (50%) of the aggregate
Liquidation Amount of all then outstanding Preferred Securities issued by the Issuer.
Obligations
means any costs, expenses or liabilities (but not including liabilities
related to taxes) of the Issuer, other than obligations of the Issuer to pay to holders of
any Trust Securities the amounts due such holders pursuant to the terms of the Trust
Securities.
Officers Certificate
means, with respect to any Person, a certificate signed by the
Chief Executive Officer, Chief Financial Officer, President or a Vice President of such
Person, and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of such Person, and delivered to the Guarantee Trustee. Any Officers
Certificate delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement (other than the certificate provided pursuant to
Section 2.4
)
shall include:
(a) a statement that each officer signing the Officers Certificate has read the
covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or investigation
undertaken by each officer in rendering the Officers Certificate;
(c) a statement that each officer has made such examination or investigation as, in
such officers opinion, is necessary to enable such officer to
4
express an informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether, in the opinion of each officer, such condition or
covenant has been complied with.
Person
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability company,
trust, unincorporated association, government or any agency or political subdivision
thereof or any other entity of whatever nature.
Responsible Officer
means, with respect to the Guarantee Trustee, any Senior Vice
President, any Vice President, any Assistant Vice President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, any Financial Services Officer or
Assistant Financial Services Officer or any other officer of the Corporate Trust Department
of the Guarantee Trustee and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of that officers
knowledge of and familiarity with the particular subject.
Senior Debt
means the principal of and any premium and interest on (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Guarantor whether or not such claim for post-petition
interest is allowed in such proceeding) all Debt of the Guarantor, whether incurred on or
prior to the date of the Indenture or thereafter incurred, unless it is provided in the
instrument creating or evidencing the same or pursuant to which the same is outstanding,
that such obligations are not superior in right of payment to the Preferred Securities;
provided, however
, that if the Guarantor is subject to the regulation and supervision of an
appropriate Federal banking agency within the meaning of 12 U.S.C. 1813(q), the
Guarantor shall have received the approval of such appropriate Federal banking agency prior
to issuing any such obligation if not otherwise generally approved;
provided further
, that
Senior Debt shall not include any other debt securities, and guarantees in respect of such
debt securities, issued to any trust other than the Issuer (or a trustee of such trust),
partnership or other entity affiliated with the Guarantor that is a financing vehicle of
the Guarantor (a financing entity), in connection with the issuance by such financing
entity of equity securities or other securities that are treated as equity capital for
regulatory capital purposes guaranteed by the Guarantor pursuant to an instrument that
ranks
pari passu
with or junior in right of payment to this Guarantee Agreement, including,
without limitation, securities issued by Texas Capital Statutory Trust I, Texas Capital
Statutory Trust II, Texas Capital Statutory Trust III and Texas Capital Statutory Trust IV.
Successor Guarantee Trustee
means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.1.
5
Trust Indenture Act
means the Trust Indenture Act of 1939, as amended and as in
effect on the date of this Guarantee Agreement.
Capitalized or otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date hereof.
ARTICLE II
Reports
SECTION 2.1
List of Holders.
The Guarantor shall furnish or cause to be furnished to the Guarantee Trustee at such times as
the Guarantee Trustee may request in writing, within thirty (30) days after the receipt by the
Guarantor of any such request, a list, in such form as the Guarantee Trustee may reasonably
require, of the names and addresses of the Holders (the
List of Holders
) as of a date not more
than fifteen (15) days prior to the time such list is furnished, in each case to the extent such
information is in the possession or control of the Guarantor and is not identical to a previously
supplied list of Holders or has not otherwise been received by the Guarantee Trustee in its
capacity as such. The Guarantee Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.
SECTION 2.2
Periodic Reports to the Guarantee Trustee.
The Guarantor shall deliver to the Guarantee Trustee, within one hundred and twenty (120) days
after the end of each fiscal year of the Guarantor ending after the date of this Guarantee
Agreement, an Officers Certificate covering the preceding fiscal year, stating whether or not to
the knowledge of the signers thereof the Guarantor is in default in the performance or observance
of any of the terms or provisions or any of the conditions of this Guarantee Agreement (without
regard to any period of grace or requirement of notice provided hereunder) and, if the Guarantor
shall be in default thereof, specifying all such defaults and the nature and status thereof of
which they have knowledge.
SECTION 2.3
Event of Default; Waiver.
The Holders of a Majority in Liquidation Amount of the Preferred Securities may, on behalf of
the Holders, waive any past Event of Default and its consequences. Upon such waiver, any such
Event of Default shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been cured, for every purpose of this Guarantee Agreement, but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right consequent therefrom.
6
SECTION 2.4
Event of Default; Notice.
(a) The Guarantee Trustee shall, within ninety (90) days after the occurrence of a
default, transmit to the Holders notices of all defaults actually known to the Guarantee
Trustee, unless such defaults have been cured or waived before the giving of such notice,
provided
, that, except in the case of a default in the payment of a Guarantee Payment, the
Guarantee Trustee shall be protected in withholding such notice if and so long as the Board
of Directors, the executive committee or a trust committee of directors and/or Responsible
Officers of the Guarantee Trustee in good faith determine that the withholding of such
notice is in the interests of the Holders. For the purpose of this
Section 2.4
,
the term
default
means any event that is, or after notice or lapse of time or both would
become, an Event of Default.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any Event of
Default unless the Guarantee Trustee shall have received written notice, or a Responsible
Officer charged with the administration of this Guarantee Agreement shall have obtained
written notice, of such Event of Default from the Guarantor or a Holder.
ARTICLE III
Powers, Duties And Rights Of The Guarantee Trustee
SECTION 3.1
Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee Trustee for the benefit of
the Holders, and the Guarantee Trustee shall not transfer this Guarantee Agreement to any
Person except a Holder exercising its rights pursuant to
Section 5.
4(d)
or to a Successor
Guarantee Trustee upon acceptance by such Successor Guarantee Trustee of its appointment to
act as Successor Guarantee Trustee. The right, title and interest of the Guarantee Trustee
shall automatically vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such vesting and cessation of
title shall be effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Guarantee Trustee.
(b) The rights, immunities, duties and responsibilities of the Guarantee Trustee shall
be as provided by this Guarantee Agreement and there shall be no other duties or
obligations, express or implied, of the Guarantee Trustee. Notwithstanding the foregoing,
no provisions of this Guarantee Agreement shall require the Guarantee Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not herein expressly so
provided, every provision of this Guarantee Agreement relating to the conduct or affecting
the liability of or affording protection to the Guarantee Trustee shall be
7
subject to the provisions of this
Section 3.1
. To the extent that, at law or
in equity, the Guarantee Trustee has duties and liabilities relating to the Guarantor or
the Holders, the Guarantee Trustee shall not be liable to any Holder for the Guarantee
Trustees good faith reliance on the provisions of this Guarantee Agreement. The
provisions of this Guarantee Agreement, to the extent that they restrict the duties and
liabilities of the Guarantee Trustee otherwise existing at law or in equity, are agreed by
the Guarantor and the Holders to replace such other duties and liabilities of the Guarantee
Trustee.
(c) No provision of this Guarantee Agreement shall be construed to relieve the
Guarantee Trustee from liability for its own negligent action, negligent failure to act or
own willful misconduct, except that:
(i) the Guarantee Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer of the Guarantee Trustee, unless it shall be
proved that the Guarantee Trustee was negligent in ascertaining the pertinent facts
upon which such judgment was made; and
(ii) the Guarantee Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the direction
of the Holders of not less than a Majority in Liquidation Amount of the Preferred
Securities relating to the time, method and place of conducting any proceeding for
any remedy available to the Guarantee Trustee, or exercising any trust or power
conferred upon the Guarantee Trustee under this Guarantee Agreement.
SECTION 3.2
Certain Rights of the Guarantee Trustee.
(a) Subject to the provisions of
Section 3.1
:
(i) the Guarantee Trustee may conclusively rely and shall be fully protected
in acting or refraining from acting in good faith and in accordance with the terms
hereof upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document reasonably believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties;
(ii) any direction or act of the Guarantor contemplated by this Guarantee
Agreement shall be sufficiently evidenced by an Officers Certificate unless
otherwise prescribed herein;
(iii) the Guarantee Trustee may consult with counsel, and the advice of such
counsel shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted to be taken by it hereunder in good faith and in
reliance thereon and in accordance with such advice. Such counsel may be counsel
to the Guarantee Trustee,
8
the Guarantor or any of its Affiliates and may be one of its employees. The
Guarantee Trustee shall have the right at any time to seek instructions concerning
the administration of this Guarantee Agreement from any court of competent
jurisdiction;
(iv) the Guarantee Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Guarantee Agreement at the request or
direction of any Holder, unless such Holder shall have provided to the Guarantee
Trustee reasonable security or indemnity against the costs, expenses (including
reasonable attorneys fees and expenses) and liabilities that might be incurred by
it in complying with such request or direction, including such reasonable advances
as may be requested by the Guarantee Trustee;
provided
, that, nothing contained in
this Section
3.2(a)(iv)
shall be taken to relieve the Guarantee Trustee,
upon the occurrence of an Event of Default, of its obligation to exercise the
rights and powers vested in it by this Guarantee Agreement;
(v) the Guarantee Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document, but the Guarantee
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and if the Guarantee Trustee shall
determine to make such inquiry or investigation, it shall be entitled to examine
the books, records and premises of the Guarantor, personally or by agent or
attorney;
(vi) the Guarantee Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents,
attorneys, custodians or nominees and the Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent,
attorney, custodian or nominee appointed with due care by it hereunder;
(vii) whenever in the administration of this Guarantee Agreement the Guarantee
Trustee shall deem it desirable to receive instructions with respect to enforcing
any remedy or right hereunder, the Guarantee Trustee (A) may request instructions
from the Holders of a Majority in Liquidation Amount of the Preferred Securities,
(B) may refrain from enforcing such remedy or right or taking such other action
until such instructions are received and (C) shall be protected in acting in
accordance with such instructions;
(viii) except as otherwise expressly provided by this Guarantee Agreement, the
Guarantee Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Guarantee Agreement; and
9
(ix) whenever, in the administration of this Guarantee Agreement, the
Guarantee Trustee shall deem it desirable that a matter be proved or established
before taking, suffering or omitting to take any action hereunder, the Guarantee
Trustee (unless other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and rely upon an Officers Certificate
which, upon receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(b) No provision of this Guarantee Agreement shall be deemed to impose any duty or
obligation on the Guarantee Trustee to perform any act or acts or exercise any right,
power, duty or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Guarantee Trustee shall be unqualified or incompetent in
accordance with applicable law, to perform any such act or acts or to exercise any such
right, power, duty or obligation. No permissive power or authority available to the
Guarantee Trustee shall be construed to be a duty to act in accordance with such power and
authority.
SECTION 3.3
Compensation.
The Guarantor agrees to pay to the Guarantee Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be limited by any
provisions of law in regard to the compensation of a trustee of an express trust) and to reimburse
the Guarantee Trustee upon request for all reasonable expenses, disbursements and advances
(including the reasonable fees and expenses of its attorneys and agents) incurred or made by the
Guarantee Trustee in accordance with any provisions of this Guarantee Agreement.
SECTION 3.4
Indemnity.
The Guarantor agrees to indemnify and hold harmless the Guarantee Trustee and any of its
Affiliates and any of their officers, directors, shareholders, employees, representatives or agents
from and against any loss, damage, liability, tax (other than income, franchise or other taxes
imposed on amounts paid pursuant to
Section 3.3
), penalty, expense or claim of any kind or
nature whatsoever incurred without negligence, bad faith or willful misconduct on its part, arising
out of or in connection with the acceptance or administration of this Guarantee Agreement,
including the costs and expenses of defending itself against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder. The Guarantee Trustee
will not claim or exact any lien or charge on any Guarantee Payments as a result of any amount due
to it under this Guarantee Agreement. This indemnity shall survive the termination of this
Agreement or the resignation or removal of the Guarantee Trustee.
In no event shall the Guarantee Trustee be liable for any indirect, special, punitive or
consequential loss or damage of any kind whatsoever, including, but not limited to, lost profits,
even if the Guarantee Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.
10
In no event shall the Guarantee Trustee be liable for any failure or delay in the performance
of its obligations hereunder because of circumstances beyond its control, including, but not
limited to, acts of God, flood, war (declared or undeclared), terrorism, fire, riot, embargo or
government action, including any laws, ordinances, regulations, governmental action or the like
which delay, restrict or prohibit the providing of the services contemplated by this Guarantee
Agreement.
SECTION 3.5
Securities.
The Guarantee Trustee or any other agent of the Guarantee Trustee, in its individual or any
other capacity, may become the owner or pledgee of Common or Preferred Securities.
ARTICLE IV
Guarantee Trustee
SECTION 4.1
Guarantee Trustee; Eligibility
.
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business under the laws of the
United States or of any State thereof, authorized to exercise corporate trust
powers, having a combined capital and surplus of at least fifty million dollars
($50,000,000), subject to supervision or examination by Federal or State authority
and having an office within the United States. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements of
such supervising or examining authority, then, for the purposes of this
Section
4.1
, the combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to so act under
Section 4.1(a)
, the Guarantee Trustee shall immediately resign in the manner and
with the effect set out in
Section 4.2(c)
.
(c) If the Guarantee Trustee has or shall acquire any conflicting interest within
the meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee shall
either eliminate such interest or resign in the manner and with the effect set out in
Section 4.2(c)
.
11
SECTION 4.2
Appointment, Removal and Resignation of the Guarantee Trustee.
(a) Subject to
Section 4.2(b)
, the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor, except during an Event of Default.
(b) The Guarantee Trustee shall not be removed until a Successor Guarantee Trustee has
been appointed and has accepted such appointment by written instrument executed by such
Successor Guarantee Trustee and delivered to the Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office until a Successor
Guarantee Trustee shall have been appointed or until its removal or resignation. The
Guarantee Trustee may resign from office (without need for prior or subsequent accounting)
by an instrument in writing executed by the Guarantee Trustee and delivered to the
Guarantor, which resignation shall not take effect until a Successor Guarantee Trustee has
been appointed and has accepted such appointment by instrument in writing executed by such
Successor Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and accepted
appointment as provided in this
Section 4.2
within thirty (30) days after delivery
to the Guarantor of an instrument of resignation, the resigning Guarantee Trustee may
petition, at the expense of the Guarantor, any court of competent jurisdiction for
appointment of a Successor Guarantee Trustee. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a Successor Guarantee Trustee.
ARTICLE V
Guarantee
SECTION 5.1
Guarantee.
(a) The Guarantor irrevocably and unconditionally agrees to pay in full to the Holders
the Guarantee Payments (without duplication of amounts theretofore paid by or on behalf of
the Issuer), as and when due, regardless of any defense (except for the defense of payment
by the Issuer), right of set-off or counterclaim which the Issuer may have or assert. The
Guarantors obligation to make a Guarantee Payment may be satisfied by direct payment of
the required amounts by the Guarantor to the Holders or by causing the Issuer to pay such
amounts to the Holders. The Guarantor shall give prompt written notice to the Guarantee
Trustee in the event it makes any direct payment to the Holders hereunder.
(b) The Guarantor hereby also agrees to assume any and all Obligations of the Issuer,
and, in the event any such Obligation is not so assumed, subject to the terms and
conditions hereof, the Guarantor hereby irrevocably and
12
unconditionally guarantees to each Beneficiary the full payment, when and as due, of
any and all Obligations to such Beneficiaries. This Guarantee is intended to be for the
Beneficiaries who have received notice hereof.
SECTION 5.2
Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the Guarantee Agreement and of any
liability to which it applies or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee Trustee, Issuer or any other Person before proceeding
against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and
all other notices and demands.
SECTION 5.3
Obligations Not Affected.
The obligations, covenants, agreements and duties of the Guarantor under this Guarantee
Agreement shall in no way be affected or impaired by reason of the happening from time to time of
any of the following:
(a) the release or waiver, by operation of law or otherwise, of the performance or
observance by the Issuer of any express or implied agreement, covenant, term or condition
relating to the Preferred Securities to be performed or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any portion of the
Distributions (other than an extension of time for payment of Distributions that results
from the extension of any interest payment period on the Notes as provided in the
Indenture), Redemption Price, Liquidation Distribution or any other sums payable under the
terms of the Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred Securities;
(c) any failure, omission, delay or lack of diligence on the part of the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred on the Holders
pursuant to the terms of the Preferred Securities, or any action on the part of the Issuer
granting indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other similar
proceedings affecting, the Issuer or any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or hereby
incurred; or
13
(g) any other circumstance whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a guarantor, it being the intent of this
Section
5.3
that the obligations of the Guarantor hereunder shall be absolute and unconditional
under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain the consent of, the
Guarantor with respect to the happening of any of the foregoing.
SECTION 5.4
Rights of Holders.
The Guarantor expressly acknowledges that: (a) this Guarantee Agreement will be deposited
with the Guarantee Trustee to be held for the benefit of the Holders; (b) the Guarantee Trustee has
the right to enforce this Guarantee Agreement on behalf of the Holders; (c) the Holders of a
Majority in Liquidation Amount of the Preferred Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the Guarantee Trustee in
respect of this Guarantee Agreement or exercising any trust or power conferred upon the Guarantee
Trustee under this Guarantee Agreement; and (d) any Holder may institute a legal proceeding
directly against the Guarantor to enforce its rights under this Guarantee Agreement, without first
instituting a legal proceeding against the Guarantee Trustee, the Issuer or any other Person.
SECTION 5.5
Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not of collection. This Guarantee
Agreement will not be discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by the Issuer) or upon distribution of Notes to Holders as
provided in the Trust Agreement.
SECTION 5.6
Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders against the Issuer in
respect of any amounts paid to the Holders by the Guarantor under this Guarantee Agreement and
shall have the right to waive payment by the Issuer pursuant to
Section 5.1
;
provided
,
that, the Guarantor shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any rights it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and unpaid under this Guarantee
Agreement. If any amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay over such amount to
the Holders.
SECTION 5.7
Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are independent of the obligations
of the Issuer with respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant
14
to the terms of this Guarantee Agreement notwithstanding the occurrence of any event referred
to in subsections (a) through (g), inclusive, of
Section 5.3
.
SECTION 5.8
Enforcement.
A Beneficiary may enforce the Obligations of the Guarantor contained in
Section 5.1(b)
directly against the Guarantor, and the Guarantor waives any right or remedy to require that any
action be brought against the Issuer or any other person or entity before proceeding against the
Guarantor.
ARTICLE VI
Covenants and Subordination
SECTION 6.1
Dividends, Distributions and Payments
.
So long as any Preferred Securities remain outstanding, if there shall have occurred and be
continuing an Event of Default or the Guarantor shall have entered into an Extension Period as
provided for in the Indenture and such period, or any extension thereof, shall have commenced and
be continuing, then the Guarantor may not (a) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make liquidation payment with respect to, any of the Guarantors
capital stock or (b) make any payment of principal of or any interest or premium on or repay,
repurchase or redeem any debt securities of the Guarantor that rank
pari passu
in all respects with
or junior in interest to the Notes issued pursuant to the Indenture (other than (i) repurchases,
redemptions or other acquisitions of shares of capital stock of the Guarantor in connection with
any employment contract, benefit plan or other similar arrangement with or for the benefit of any
one or more employees, officers, directors or consultants, in connection with a dividend
reinvestment or stockholder stock purchase plan or in connection with the issuance of capital stock
of the Guarantor (or securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the occurrence of such Event of
Default or the applicable Extension Period, (ii) as a result of a reclassification of the
Guarantors capital stock or the exchange or conversion of any class or series of the Guarantors
capital stock (or any capital stock of a subsidiary of the Guarantor) for any class or series of
the Guarantors capital stock or any class or series of the Guarantors indebtedness for any class
or series of the Guarantors capital stock, (iii) the purchase of fractional interests in shares of
the Guarantors capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (iv) any declaration of a dividend in
connection with any rights plan, the issuance of rights, stock or other property under any rights
plan or the redemption or repurchase of rights pursuant thereto, or (v) any dividend or
distribution in the form of stock, warrants, options or other rights where the dividend or
distribution stock or the stock issuable upon exercise of such warrants, options or other rights is
the same stock as that on which the dividend or distribution is being paid or ranks
pari passu
with
or junior to such stock) or dividends or distributions in shares of, or options, warrants, rights
to subscribe for or purchase shares of, common stock of the Guarantor.
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SECTION 6.2
Subordination.
The obligations of the Guarantor under this Guarantee Agreement will constitute unsecured
obligations of the Guarantor and will rank subordinate and junior in right of payment to all Senior
Debt of the Guarantor to the extent and in the same manner that the Notes are subordinated to
Senior Debt pursuant to the Indenture, it being understood that the terms of Article XII of the
Indenture shall apply to the obligations of the Guarantor under this Guarantee Agreement as if such
provisions were set forth in full herein.
SECTION 6.3
Pari Passu Guarantees.
(a) The obligations of the Guarantor under this Guarantee Agreement shall rank
pari
passu
with the obligations of the Guarantor under any similar guarantee agreements issued
by the Guarantor with respect to preferred securities (if any) similar to the Preferred
Securities, issued by trusts other than the Issuer established or to be established by the
Guarantor (if any), in each case similar to the Issuer, including, without limitation, the
Guarantee Agreements, dated November 19, 2002, April 10, 2003, October 6, 2005 and April
28, 2006, issued by the Guarantor with respect to the preferred securities issued by Texas
Capital Statutory Trust I, Texas Capital Statutory Trust II, Texas Capital Statutory Trust
III and Texas Capital Statutory Trust IV, respectively.
(b) The right of the Guarantor to participate in any distribution of assets of any of
its subsidiaries upon any such subsidiarys liquidation or reorganization or otherwise is
subject to the prior claims of creditors of that subsidiary, except to the extent the
Guarantor may itself be recognized as a creditor of that subsidiary. Accordingly, the
Guarantors obligations under this Guarantee will be effectively subordinated to all
existing and future liabilities of the Guarantors subsidiaries, and claimants should look
only to the assets of the Guarantor for payments hereunder. This Guarantee does not limit
the incurrence or issuance of other secured or unsecured debt of the Guarantor, including
Senior Debt of the Guarantor, under any indenture or agreement that the Guarantor may enter
into in the future or otherwise.
ARTICLE VII
Termination
SECTION 7.1
Termination.
This Guarantee Agreement shall terminate and be of no further force and effect upon (a) full
payment of the Redemption Price of all Preferred Securities, (b) the distribution of Notes to the
Holders in exchange for all of the Preferred Securities or (c) full payment of the amounts payable
in accordance with the Trust Agreement upon liquidation of the Issuer. Notwithstanding the
foregoing, this Guarantee Agreement will continue to be effective or will be reinstated, as the
case may be, if at any time any Holder must restore payment of any sums paid with respect to
Preferred Securities or this
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Guarantee Agreement. The obligations of the Guarantor under
Sections 3.3
and
3.4
shall survive any such termination or the resignation and removal of the Guarantee
Trustee.
ARTICLE VIII
Miscellaneous
SECTION 8.1
Successors and Assigns.
All guarantees and agreements contained in this Guarantee Agreement shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders of the Preferred Securities then outstanding. Except in connection with a
consolidation, merger or sale involving the Guarantor that is permitted under Article VIII of the
Indenture and pursuant to which the successor or assignee agrees in writing to perform the
Guarantors obligations hereunder, the Guarantor shall not assign its rights or delegate its
obligations hereunder without the prior approval of the Holders of a Majority in Liquidation Amount
of the Preferred Securities.
SECTION 8.2
Amendments.
Except with respect to any changes that do not adversely affect the rights of the Holders in
any material respect (in which case no consent of the Holders will be required), this Guarantee
Agreement may only be amended with the prior approval of the Guarantor, the Guarantee Trustee and
the Holders of not less than a Majority in Liquidation Amount of the Preferred Securities. The
provisions of Article VI of the Trust Agreement concerning meetings or consents of the Holders
shall apply to the giving of such approval.
SECTION 8.3
Notices.
Any notice, request or other communication required or permitted to be given hereunder shall
be in writing, duly signed by the party giving such notice, and delivered, telecopied or mailed by
first class mail as follows:
(a) if given to the Guarantor, to the address or facsimile number set forth below or
such other address, facsimile number or to the attention of such other Person as the
Guarantor may give by notice to the Guarantee Trustee and the Holders:
Texas Capital Bancshares, Inc.
2100 McKinney Avenue
Suite 900
Dallas, Texas 75201
Facsimile No.: (214) 932-6775
Attention: Chief Financial Officer
(b) if given to the Issuer, at the Issuers address or facsimile number set forth
below or such other address, facsimile number or to the attention of such
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other Person as the Issuer may give by notice to the Guarantee Trustee and the
Holders:
Texas Capital Statutory Trust V
c/o Texas Capital Bancshares, Inc.
2100 McKinney Avenue
Suite 900
Dallas, Texas 75201
Facsimile No.: (214) 932-6775
Attention: Administrative Trustee
(c) if given to the Guarantee Trustee, at the address or facsimile number set forth
below or such other address, facsimile number or to the attention of such other Person as
the Guarantee Trustee may give by notice to the Guarantor and the Holders:
Wilmington Trust Company
Rodney Square North
1100 North Market St.
Wilmington, Delaware 19890-1600
Facsimile No.: (302) 636-4140
Attention: Corporate Trust Administration
(d) if given to any Holder, at the address set forth on the books and records of the
Issuer.
All notices hereunder shall be deemed to have been given when received in person, telecopied
with receipt confirmed, or mailed by first class mail, postage prepaid, except that if a notice or
other document is refused delivery or cannot be delivered because of a changed address of which no
notice was given, such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 8.4
Benefit.
This Guarantee Agreement is solely for the benefit of the Holders and is not separately
transferable from the Preferred Securities.
SECTION 8.5
Governing Law.
This Guarantee Agreement and the rights and obligations of each party hereto, shall be
construed and enforced in accordance with and governed by the laws of the State of New York without
reference to its conflict of laws provisions (other than Section 5-1401 of the General Obligations
Law).
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SECTION 8.6
Submission to Jurisdiction.
ANY LEGAL ACTION OR PROCEEDING BY OR AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR ARISING
OUT OF THIS GUARANTEE AGREEMENT MAY BE BROUGHT IN OR REMOVED TO THE COURTS OF THE STATE OF NEW
YORK, IN AND FOR THE COUNTY OF NEW YORK, OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN
DISTRICT OF NEW YORK (IN EACH CASE SITTING IN THE BOROUGH OF MANHATTAN). BY EXECUTION AND DELIVERY
OF THIS GUARANTEE AGREEMENT, EACH PARTY ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS (AND COURTS OF APPEALS
THEREFROM) FOR LEGAL PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTEE AGREEMENT.
SECTION 8.7
Counterparts.
This instrument may be executed in any number of counterparts, each of which so executed shall
be deemed to be an original, but all such counterparts shall together constitute but one and the
same instrument.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
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In Witness Whereof
, the undersigned have executed this Guarantee Agreement as of the
date first above written.
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TEXAS CAPITAL BANCSHARES, INC.
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By:
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/s/ Peter Bartholow
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Name: Peter Bartholow
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Title: Chief Financial Officer
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WILMINGTON TRUST COMPANY, not in its individual
capacity, but solely as Guarantee Trustee
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By:
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/s/ Christopher J. Slaybaugh
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Name Christopher J. Slaybaugh
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Title: Senior Financial Services Officer
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