Exhibit 1.1
Execution Version
$60,000,000
5.625% Fixed to Floating Rate Subordinated Notes due 2030
COBIZ FINANCIAL INC.
(a Colorado corporation)
UNDERWRITING AGREEMENT
J.P. Morgan Securities LLC
Keefe, Bruyette & Woods, Inc.
As representatives of the several underwriters
c/o
J.P. Morgan Securities LLC
270 Park Avenue
New York, New York 10017
Keefe, Bruyette & Woods, Inc.
787 Seventh Avenue
5th Floor
New York, New York 10019
Ladies and Gentlemen:
CoBiz Financial Inc., a Colorado corporation (the “
Company
”), proposes to issue and sell to the several underwriters named in
Schedule I
hereto (collectively, the “
Underwriters
”) $60,000,000 aggregate principal amount of the Company’s 5.625% Fixed to Floating Rate Subordinated Notes due 2030 (the “
Notes
”) pursuant to the terms and conditions of this Underwriting Agreement (this “
Agreement
”). The Notes are to be issued pursuant to an indenture, dated as of June 25, 2015 (the “
Base Indenture
”), between the Company and U.S. Bank, National Association, as trustee (the “
Trustee
”), as supplemented by a supplemental indenture, dated as of June 25, 2015 (the “
First Supplemental Indenture
” and, together with the Base Indenture, the “
Indenture
”), between the Company and the Trustee. J.P. Morgan Securities LLC (“
JPM
”) and Keefe, Bruyette & Woods, Inc. (“
KBW
”) have agreed to act as representatives of the Underwriters (in such capacity, the “
Representatives
”) in connection with the offering and sale of the Notes. To the extent there are no additional Underwriters listed on Schedule I, the term “Representatives” as used herein shall mean JPM and KBW, as Underwriters, and the term “Underwriters” shall mean either the singular or the plural, as the context requires.
The Company confirms as follows its agreement with the several Underwriters in connection with the purchase and sale of the Notes.
1.
The Company represents and warrants to, and agrees with, the Underwriters that, at the date hereof, at the Applicable Time (as defined in Section 1(iv) herein) and at the Closing Date (as defined in Section 4 herein):
(i)
the Company has filed with the Securities and Exchange Commission (the “
Commission
”) a registration statement on Form S-3 (File No. 333-190361) (the “
Initial Registration Statement
”) in respect of various securities, including the Notes; the Initial Registration Statement and any post-effective amendment thereto, each in the form heretofore delivered to the Underwriters and, excluding exhibits to the Initial Registration Statement, but including all documents incorporated by reference in the prospectus included therein, have been declared effective by the Commission in such form; other than a registration statement, if any, increasing the size of the offering (a “
Rule 462(b) Registration Statement
”), filed pursuant to Rule 462(b) under the Securities
Act of 1933, as amended (the “
Securities Act
”), which became effective upon filing, no other document amending or supplementing the Initial Registration Statement has heretofore been filed, or transmitted for filing, with the Commission (other than prospectuses filed pursuant to Rule 424(b) of the rules and regulations of the Commission under the Securities Act (the “
Securities Act Regulations
”), each in the form heretofore delivered to the Underwriters) (the base prospectus filed as part of the Initial Registration Statement, in the form in which it has most recently been filed with the Commission on or prior to the date of this Agreement relating to the Notes, is hereinafter called the “
Basic Prospectus
”; any preliminary prospectus (including any preliminary prospectus supplement) relating to the Notes filed with the Commission pursuant to Rule 424(b) of the Securities Act Regulations is hereinafter called a “
Preliminary Prospectus
”; the various parts of the Initial Registration Statement and the Rule 462(b) Registration Statement, if any, including all exhibits thereto and including any prospectus supplement relating to the Notes that is filed with the Commission and deemed by virtue of Rule 430B of the Securities Act Regulations to be part of the Initial Registration Statement, each as amended at the time such part of the Initial Registration Statement was declared effective or such part of the Rule 462(b) Registration Statement, if any, became or hereafter becomes effective, are hereinafter collectively called the “
Registration Statement
”; the Basic Prospectus, as amended and supplemented by the preliminary prospectus supplement relating to the Notes immediately prior to the Applicable Time, is hereinafter collectively called the “
Pricing Prospectus
”; the Basic Prospectus, as amended and supplemented by the final prospectus supplement relating to the Notes filed with Commission pursuant to Rule 424(b) of the Securities Act Regulations in accordance with Section 5(a) herein, is hereinafter collectively called the “
Prospectus
”; any reference herein to the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 prior to the execution of this Agreement; any reference to any amendment or supplement to the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus shall be deemed to include any documents filed under the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), and incorporated therein, in each case at or after the execution of this Agreement; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any post-effective amendment to the Registration Statement and any annual report of the Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement, in each case, prior to the execution of this Agreement; for purposes of this Agreement, all references to the Registration Statement, the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (“
EDGAR
”); and all references in this Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” in the Registration Statement, the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus or any amendment or supplement thereto (or other references of like import) shall be deemed to include all such financial statements (including
pro forma
financial information) and schedules and other information which is incorporated by reference in or otherwise deemed by the Securities Act Regulations to be a part of or included in the Registration Statement, the Basic Prospectus, such Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or such amendment or supplement, as the case may be;
(ii)
each of the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendment thereto and any part thereof has become effective under the Securities Act, and no stop order suspending the effectiveness of the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendment thereto and any part thereof has been issued under the Securities Act and no proceedings for that purpose are pending, have been instituted or, to the knowledge of the Company, are threatened by the Commission, and any request on the part of the Commission for additional information with respect to the Registration Statement has been complied with;
(iii)
(1)
(A)
at the respective times the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto became effective, at the Applicable Time and at the Closing Date, the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendments thereto complied and will comply in all material respects with the requirements of the Securities Act, the Securities Act Regulations, the Trust Indenture Act of 1939, as amended (the “
1939 Act
”) and the rules and regulations of the Commission under the 1939 Act (the “
1939 Act Regulations
”), and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, provided that the Company makes no representations or warranties as to that part of the Registration Statement which shall constitute the Statement of Eligibility (Form T-1)
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under the 1939 Act of the Trustee and (B) as of the date of the Prospectus and any amendment or supplement thereto and at the Closing Date, neither the Prospectus nor any amendment or supplement thereto included or will include an untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the representations and warranties in clauses (iii)(1)(A) and (B) above shall not apply to statements in or omissions from any such document made in reliance upon and in conformity with information furnished to the Company in writing by an Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information provided by such Underwriter up to the date hereof is that described as such in Section 10(b) herein (collectively, the “
Underwriter Information
”), and no order preventing or suspending the use of any Preliminary Prospectus, the Pricing Prospectus, any Issuer Free Writing Prospectus (as defined below) or the Prospectus or any amendment or supplement thereto has been issued by the Commission; it being understood that “
Issuer Free Writing Prospectus
” means any “issuer free writing prospectus,” as defined in Rule 433 of the Securities Act Regulations (“
Rule 433
”), relating to the Notes that (i) is required to be filed with the Commission by the Company, (ii) is a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i) (a “
Road Show
”) whether or not required to be filed with the Commission, (iii) is the final term sheet in the form set forth on
Schedule II
hereto, reflecting solely the final terms of the Notes (the “
Final Term Sheet
”) or (iv) is exempt from filing pursuant to Rule 433(d)(5)(i) because it contains a description of the Notes or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form required to be retained in the Company’s records pursuant to Rule 433(g);
(2)
(A)
the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus, each Issuer Free Writing Prospectus and the Prospectus complied in all material respects when used or filed with the Commission with the requirements of the Securities Act and the Securities Act Regulations and did not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, provided that the representations and warranties in this clause (iii)(2)(A) shall not apply to statements in or omissions from any such document made in reliance upon and in conformity with the Underwriter Information, (B) the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus, each Issuer Free Writing Prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T, (C) all disclosures contained in the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and Prospectus regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission), if any, comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K under the Securities Act, as applicable, (D) there are no statutes, regulations, documents or contracts of a character required to be described in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus or the Prospectus or to be filed as an exhibit to the Registration Statement which are not described or filed as required, and (E) no forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith;
(3)
the Company meets the requirements for the use of Form S-3 under the Securities Act and the use of such form for the offering of the Notes is appropriate under the Securities Act Regulations, and the Company is eligible under the Securities Act to furnish information under Form S-3 by incorporating such information by reference to Company filings made pursuant the Exchange Act, and the Company was not, at the time of initial filing of the Registration Statement or at the earliest time thereafter that the Company or another offering participant made a
bona fide
offer (within the meaning of Rule 164(h)(2) of the Securities Act) of the Notes, and is not, at the date hereof, an “ineligible issuer” (as defined in Rule 405);
(4)
the documents incorporated or deemed incorporated by reference in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, at the time they were filed with the Commission, complied in all material respects with the requirements of the Securities Act, the Securities Act Regulations, the Exchange Act and the rules and regulations of the Commission under the Exchange Act, including, to the extent applicable, Commission Industry Guide 3 (the “
Exchange Act Regulations
”) and, when read together with the other information in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, at the time issued and at
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the time it became effective, did not and will not contain an untrue statement of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the representations and warranties in this clause (iii)(4) shall not apply to statements in or omissions from any such document made in reliance upon and in conformity with the Underwriter Information;
(iv)
for the purposes of this Agreement, the “
Applicable Time
” is 5:50 P.M. (New York City time) on the date of this Agreement; the Pricing Prospectus, as supplemented by the Issuer Free Writing Prospectus(es) listed in
Schedule III
hereto, if any, considered together (collectively, the “
Pricing Disclosure Package
”) as of the Applicable Time, did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and each Issuer Free Writing Prospectus listed on
Schedule III
hereto does not conflict with the information contained in the Registration Statement, the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus and each such Issuer Free Writing Prospectus, taken together with the Pricing Disclosure Package, as of the Applicable Time, did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that the representations and warranties in this clause (iv) shall not apply to statements in or omissions from the Pricing Disclosure Package or an Issuer Free Writing Prospectus made in reliance upon and in conformity with the Underwriter Information;
(v)
the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Colorado, with power and authority (corporate and other) to own, lease and operate its properties and conduct its business as described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus and to enter into and perform its obligations under this Agreement, the Indenture and the Notes, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties or conducts any business so as to require such qualification, except where the failure to qualify or be in good standing would not, individually or in the aggregate, have a material adverse effect on the general affairs, business, management, financial position, shareholders’ equity, results of operations or prospects of the Company and each of its direct and indirect subsidiaries (the
“Subsidiaries”),
considered as one enterprise (a “
Material Adverse Effect
”).
(vi)
(1)
the Company is duly registered and qualified as a financial holding company under the applicable provisions of the Bank Holding Company Act of 1956, as amended (the “
BHC Act
”), and each of the Company, its subsidiary bank, CoBiz Bank, a Colorado state-chartered bank (the “
Bank
”), and each of the other Subsidiaries is in compliance in all material respects with all applicable laws administered by and rules and regulations of the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation (the “
FDIC
”), the Colorado Division of Banking and any other federal or state bank or other regulatory authority (collectively, the “
Regulatory Authorities
”) with jurisdiction over the Company, the Bank, or any of the other Subsidiaries, as applicable;
(2)
the activities of the Company and each of its Subsidiaries are permitted under applicable federal and state banking laws and regulations and all other applicable federal and state laws, except where the failure to be permitted would not have a Material Adverse Effect, and the Company has all necessary approvals, including the approval of the Regulatory Authorities to own, directly or indirectly, the capital stock of the Subsidiaries;
(3)
the deposit accounts of the Bank are insured by the FDIC up to the maximum amount provided by law, and no proceedings for the modification, termination or revocation of any such insurance are pending or, to the knowledge of the Company, threatened;
(4)
the operations of the Company and the Subsidiaries are, and have been conducted at all times, in compliance with applicable financial recordkeeping and reporting requirements of the Bank Secrecy Act, the Currency and Foreign Transactions Reporting Act of 1970, as amended, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively, the “
Money Laundering Laws
”), except where the failure to comply with any such laws would not, individually or
4
in the aggregate, have a Material Adverse Effect; and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to any Money Laundering Laws is pending or, to the knowledge of the Company, threatened;
(vii)
none of the Company, any of its Subsidiaries or, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its Subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“
OFAC
”); and the Company will not directly or indirectly use the proceeds of the offering of the Notes hereunder, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC;
(viii)
each Subsidiary has been duly incorporated (or organized) and is validly existing as a corporation (or other organization) in good standing under the laws of the jurisdiction of its incorporation (or organization), with power and authority to own, lease and operate its properties and conduct its business as described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, and has been duly qualified as a foreign corporation (or other organization) for the transaction of business and is in good standing under the laws of each other jurisdiction in which its owns or leases properties or conducts any business so as to require such qualification, except where the failure to qualify or be in good standing would not, individually or in the aggregate, have a Material Adverse Effect; and all of the issued and outstanding capital stock (or other ownership interests) of each Subsidiary has been duly and validly authorized and issued, is fully paid and non-assessable and is owned by the Company, directly or through Subsidiaries, free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity, and all of such capital stock (or other ownership interest) is valued on the books of the Company and its Subsidiaries in accordance with generally accepted accounting principles in the United States of America (“
GAAP
”);
(ix)
(1)
the Company has an authorized capitalization as set forth in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, and all of the issued and outstanding shares of capital stock of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and conform to the descriptions thereof contained in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus in all material respects, and none of the issued and outstanding shares of capital stock of the Company are subject to any preemptive or similar rights;
(2)
since the date of the filing of the Initial Registration Statement, all offers and sales of the Company’s capital stock and other equity or debt securities prior to the date hereof were made in compliance in all material respects with, or were the subject of an available exemption from, the Securities Act and all other applicable state and federal laws or regulations;
(x)
this Agreement, the Indenture and the Notes conform to the descriptions thereof contained in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus in all material respects;
(xi)
the Indenture has been duly authorized by the Company and, at the Closing Date, will be duly qualified under the 1939 Act and will constitute a valid and binding agreement of the Company, enforceable against the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting enforcement of creditors’ rights generally or by general principles of equity (regardless of whether enforcement is considered in a proceeding in equity or at law);
(xii)
the Notes have been duly authorized by the Company for issuance and sale to the Underwriters pursuant to this Agreement and, when authenticated by the Trustee in the manner provided for in the Indenture and executed and delivered by the Company pursuant to his Agreement against payment of the consideration set forth herein, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditor’s rights generally or by general principles of equity (regardless of
5
whether enforcement is considered in a proceeding in equity or at law), and will be in the form contemplated by, and entitled to the benefits of, the Indenture;
(xiii)
this Agreement has been duly authorized, executed and delivered by the Company and constitutes a valid and binding obligation of the Company;
(xiv)
the issue and sale of the Notes by the Company, the execution and delivery of this Agreement and the Indenture by the Company and the compliance by the Company with all of the provisions of this Agreement and the Indenture and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of its Subsidiaries is subject, except where the violation or default would not, individually or in the aggregate, have a Material Adverse Effect; nor will such action result in any violation of the provisions of the certificate or articles of incorporation or by-laws (or other organization documents) of the Company or any of its Subsidiaries; nor will such action result in any violation of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its Subsidiaries or any of their properties, except where the violation would not, individually or in the aggregate, have a Material Adverse Effect; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Notes by the Company, the execution and delivery of this Agreement and the Indenture by the Company or the consummation by the Company of the transactions contemplated herein or therein, except the registration under the Securities Act of the Notes and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Notes by the Underwriters, or except where the failure to obtain any such consent, approval, authorization, order, registration or qualification would not, individually or in the aggregate, have a Material Adverse Effect;
(xv)
(1)
Crowe Horwath LLP, the accounting firm that has certified the financial statements of the Company and the Subsidiaries, are independent registered public accountants with the applicable rules and regulations adopted by the Public Company Accounting Oversight Board (United States) and as required by the Securities Act, the Securities Act Regulations, the Exchange Act and the Exchange Act Regulations, (2) the financial statements, together with related schedules and notes, included in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus comply in all material respects with the requirements of the Securities Act and present fairly the consolidated financial position, results of operations and cash flows of the Company and the Subsidiaries on the basis stated in the Registration Statement at the respective dates or for the respective periods to which they apply, (3) such statements and related schedules and notes have been prepared in accordance with GAAP consistently applied throughout the periods involved, except as disclosed therein, and (4) the selected financial data and the summary financial data included in the Pricing Prospectus present fairly the information shown therein and have been compiled on a basis consistent with that of the financial statements included in the Registration Statement, except as may be disclosed therein;
(xvi)
the Company (on a consolidated basis) has not sustained since the date of the latest audited financial statements included or incorporated by reference in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus; since the respective dates as of which information is given in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, (1) there has not been any change in the capital stock (except any change from (A) the exercise of options to acquire shares of the Company’s common stock, par value $0.01 per share (the “
Common Shares
”) granted pursuant to the Company’s benefit plans or (B) the issuance of Common Shares pursuant to the Company’s stock incentive plans, dividend reinvestment plans, stock purchase plans, retirement plans, senior officer retirement plans or 401(k) plans) or long-term debt (except any change from the repayment of any Federal Home Loan Bank advance or borrowing upon its maturity) of the Company on a consolidated basis, (2) there has not been any event that would constitute a Material Adverse Effect, or any development involving a prospective event that may reasonably be expected to have a Material Adverse Effect, (3) except as set forth in the
6
Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, there have been no transactions entered into by, and no obligations or liabilities, contingent or otherwise, incurred by, the Company or any of the Subsidiaries, whether or not in the ordinary course of business, which are material to the Company and the Subsidiaries, considered as one enterprise, and (4) except for regular quarterly dividends on the Common Shares and dividends on the Company’s Senior Non-Cumulative Perpetual Preferred Stock, Series C held by the United States Department of the Treasury under the Small Business Lending Fund Program (the “
Series C Preferred Stock
”), there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock;
(xvii)
neither the Company nor any of its Subsidiaries is (1) in violation of its certificate or articles of incorporation or bylaws (or other organization documents), (2) in violation of any law, ordinance, administrative or governmental rule or regulation applicable to the Company or any of its Subsidiaries, (3) in violation of any decree of any court or governmental agency or body having jurisdiction over the Company or any of its Subsidiaries, or (4) in default in the performance of any obligation, agreement or condition contained in any bond, debenture, note or any other evidence of indebtedness or in any agreement, indenture, lease or other instrument to which the Company or any of its Subsidiaries is a party or by which any of them or any of their respective properties may be bound, except in the case of clauses (2), (3) and (4) where the violation or default would not, individually or in the aggregate, have a Material Adverse Effect;
(xviii)
the Company and each Subsidiary has good and marketable title to all real property owned by it, in each case free and clear of all liens, encumbrances and defects except such as are described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus or except where the lien, encumbrance or defect would not, individually or in the aggregate, have a Material Adverse Effect, and any real property and buildings held under lease by the Company or any Subsidiary are held under valid, subsisting and enforceable leases except such as are described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus or except where the defect in interest would not, individually or in the aggregate, have a Material Adverse Effect;
(xix)
other than as set forth in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of the Subsidiaries is a party or of which any property of the Company or any of the Subsidiaries is the subject which, individually or in the aggregate, would have or may reasonably be expected to have a Material Adverse Effect, or would prevent or impair the consummation of the transactions contemplated by this Agreement, or which are required to be described in the Registration Statement, the Pricing Prospectus and the Prospectus; and, to the Company’s knowledge, no such proceedings are threatened or contemplated by governmental authorities or others;
(xx)
(1)
the Company and its Subsidiaries possess all permits, licenses, approvals, consents and other authorizations (collectively, “
Permits
”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the businesses now operated by them, and are in compliance with the terms and conditions of all such Permits and all of the Permits are valid and in full force and effect, and (2) neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or material modification of any such Permits; except in the case of clauses (1) and (2) where the failure to possess or comply with such Permit would not, individually or in the aggregate, have a Material Adverse Effect;
(xxi)
the Company and its Subsidiaries own or possess, or can acquire on reasonable terms, all licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names, patents and patent rights (collectively “
Intellectual Property
”) used in carrying on their businesses as described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, except where the defect in ownership would not, individually or in the aggregate, have a Material Adverse Effect; and neither the Company nor any Subsidiary has received any correspondence relating to any Intellectual Property or notice of infringement of or conflict with asserted rights of others with respect to any Intellectual Property which would render any Intellectual Property invalid or inadequate to protect the interest of the Company and the Subsidiaries, except where such claims if determined adversely, would not, individually or in the aggregate, have a Material Adverse Effect;
7
(xxii)
no labor dispute with the employees of the Company or its Subsidiaries which, individually or in the aggregate, have a Material Adverse Effect exists, or, to the knowledge of the Company, is imminent;
(xxiii)
the Company and its Subsidiaries are insured against such material losses and risks and in such amounts as are customary in the businesses in which they are engaged;
(xxiv)
the allowance for loan and lease losses included in the most recent financial statements of the Company are at an appropriate level in light of estimated credit losses within the Company’s and its Subsidiaries’ portfolio of loans and leases as of the date of those financial statements and was prepared in accordance with GAAP and the regulations and policies of the Regulatory Authorities having jurisdiction over the Company and its Subsidiaries;
(xxv)
the Company and its Subsidiaries maintain systems of “internal control over financial reporting” (as defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences; and (v) the interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement is in conformity with GAAP, has been prepared in accordance with the Commission’s rules and guidelines applicable thereto and is updated as necessary to comply in all material respects with the requirements of the Securities Act and the Commission’s rules and guidelines applicable thereto and present fairly the consolidated financial position, results of operations and cash flows of the Company and the Subsidiaries on the basis stated in the Registration Statement at the respective dates or for the respective periods to which they apply; since the date of the latest audited financial statements included or incorporated by reference in the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, (1) the Company has not been advised of (A) any significant deficiencies in the design or operation of internal controls that could adversely affect the ability of the Company and each of its Subsidiaries, to record, process, summarize and report financial data, or any material weaknesses in internal controls or (B) any fraud, whether or not material, that involves management or other employees who have a significant role in the internal controls of the Company and each of its Subsidiaries, and (2) there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting;
(xxvi)
the Company maintains disclosure controls and procedures (as such term is defined in Rule 13a-15(e) of the Exchange Act) that comply with the requirements of the Exchange Act, and such disclosure controls and procedures are effective, and the Company has complied and continues to comply in all material respects with the corporate governance compliance guidelines set forth in the NASDAQ listing standards;
(xxvii)
all United States federal income tax returns of the Company and the Subsidiaries required by law to be filed have been filed and all taxes shown by such returns or otherwise assessed, which are due and payable, have been paid, except assessments against which appeals have been or will be promptly taken or except as would not have a Material Adverse Effect, and the Company and the Subsidiaries have (1) filed all other tax returns that are required to have been filed by them pursuant to applicable foreign, state, local or other law, and (2) paid all taxes due pursuant to such returns or pursuant to any assessment received by the Company or any Subsidiary except for such taxes, if any, as are being contested in good faith or where failure to file such returns or pay such taxes would not have a Material Adverse Effect;
(xxviii)
neither the Company nor any of the Subsidiaries is in violation of any statute or any rule, regulation, decision or order of any governmental agency or body or any court, domestic or foreign, relating to the use, production, disposal or release of hazardous or toxic substances or relating to the protection or
8
restoration of the environment or human exposure to hazardous or toxic substances (collectively, “
Environmental Laws
”), owns or operates any real property contaminated with any substance that is subject to any Environmental Laws, is liable for any off-site disposal or contamination pursuant to any Environmental Laws, or is subject to any claim relating to any Environmental Laws, which violation, contamination, liability or claim, individually or in the aggregate, would have a Material Adverse Effect, and the Company is not aware of any pending investigation which alleged such a claim;
(xxix)
each employee pension benefit plan, within the meaning of Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“
ERISA
”), that is maintained, administered or contributed to by the Company or any member of its “Controlled Group” (defined as any organization which is a member of a controlled group of corporations within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended (the “
Code
”)) for employees or former employees of the Company and its affiliates has been maintained in material compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Code; no material prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code has occurred with respect to any such plan excluding transactions effected pursuant to a statutory or administrative exemption; for each plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no material “accumulated funding deficiency” as defined in Section 412 of the Code, whether or not waived, has occurred or is reasonably expected to occur; the fair market value of the assets of each such plan exceeds the present value of all benefits accrued under such plan (determined based on those assumptions used to fund such plan); no material “reportable event” (within the meaning of Section 40431 of ERISA) has occurred or is reasonably expected to occur; and neither the Company nor any member of the Controlled Group has incurred, nor reasonably expects to incur, any material liability under Title IV of ERISA (other than contributions to the plan or premiums to the PBGC, in the ordinary course and without default) in respect of a plan (including a “multi employer plan”, within the meaning of Section 4001(aX3) of ERISA);
(xxx)
neither the Company nor any of its Subsidiaries, or to the Company’s knowledge any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of its Subsidiaries, has (1) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity, (2) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, or (3) made any unlawful bribe, unlawful rebate, payoff, influence payment, kickback or other unlawful payment;
(xxxi)
except as described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus and except for the warrant to acquire 895,968 Common Shares originally issued to the U.S. Department of the Treasury under the Capital Purchase Program, neither the Company nor any Subsidiary has outstanding, on the date of this Agreement, or will have outstanding, at the Closing Date any options to purchase or any warrants to subscribe for, or any securities or obligations convertible into, or any contracts or commitments to issue or sell, any Common Shares or any such warrants, convertible securities or obligations, and except for the Company’s obligation to register the shares of the Series C Preferred Stock (for which the Company has filed a registration statement on Form S-3 with the Commission (File No. 333-177216)), there are no persons with registration rights or other similar rights to have securities registered in connection with the filing of the Registration Statement or otherwise registered by the Company under the Securities Act;
(xxxii)
the Company is not and, after giving effect to the offering and sale of the Notes as contemplated herein and the application of the net proceeds therefrom as described in the Registration Statement, each Preliminary Prospectus, the Pricing Prospectus and the Prospectus, will not be an “investment company”, as such term is defined in the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively, the “
Investment Company Act
”);
(xxxiii)
the Company has not distributed and, prior to the later to occur of the Closing Date and completion of distribution of the Notes, will not distribute any offering materials in connection with the offering and sale of the Notes, other than the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus, the Prospectus or any communication that is not deemed to be a prospectus or an offer of securities under the Securities Act or the Securities Act Regulations and, subject to compliance with Section 6 herein, any Issuer Free Writing Prospectus; and the Company has not taken and will not take, directly or indirectly, any action designed to
9
cause or result in, or which constitutes or might reasonably be expected to constitute, the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Notes or for any other purpose;
(xxxiv)
other than as contemplated by this Agreement, there is no broker, finder or other party that is entitled to receive from the Company or any Subsidiary any brokerage or finder’s fee as a result of the transactions contemplated by this Agreement;
(xxxv)
other than the Notes, the Company has no debt securities to which a rating is accorded by any “nationally recognized statistical rating organization,” as defined in Section 3(a)(62) of the Exchange Act;
(xxxvi)
any certificate signed by any officer of the Company delivered to the Representatives or to counsel for the Underwriters in connection with the sale and delivery of the Notes to the Underwriters shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
2.
Subject to the terms and conditions herein set forth, the Company agrees to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at a purchase price equal to 98.75% of the aggregate principal amount of the Notes (the “
Purchase Price
”), the aggregate principal amount of the Notes set forth in Schedule I opposite the name of such Underwriter.
3.
It is understood that the Underwriters propose to offer the Notes for sale to the public upon the terms and conditions set forth in the Prospectus.
4.
The Company will deliver the Notes to the Representatives through the facilities of The Depository Trust Company (“
DTC
”) for the account(s) specified by the Representatives, against payment of the purchase price therefor in Federal (same day) funds by official bank check or checks or wire transfer drawn to the order of the Company at the office of Sidley Austin LLP, 787 Seventh Avenue, New York, New York 10019, New York time, on June 25, 2015, or at such other time not later than seven full business days thereafter as the Representatives and the Company determine, such time being herein referred to as the “
Closing Date
”. For purposes of Rule 15c6-1 under the Exchange Act, the Closing Date (if later than the otherwise applicable settlement date) shall be the settlement date for payment of funds and delivery of securities for all the Notes.
5.
The Company covenants and agrees with the Underwriters as follows:
(a)
For so long as the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is required in connection with the offering or sale of the Notes, the Company, subject to Section 5(b) herein, will comply with the requirements of Rule 430B under the Securities Act, and will notify the Representatives immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any amendment or supplement to the Prospectus shall have been filed, to furnish the Underwriters with copies thereof, and to file promptly all material required to be filed by the Company with the Commission pursuant to Rule 433(d) under the Securities Act, (ii) of the receipt of any comments on the Registration Statement or the Prospectus or the documents incorporated by reference therein from the Commission, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or of the suspension of the qualification of the Notes for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(e) of the Securities Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A of the Securities Act in connection with the offering of the Notes. For so long as the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is required in connection with the offering or sale of the Notes, the Company will effect the filings necessary pursuant to Rule 424(b) under the Securities Act within the time period required thereby, and will make every reasonable effort
10
to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment.
(b)
For so long as the delivery of a prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is required in connection with the offering or sale of the Notes, the Company will give the Representatives notice of its intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b) under the Securities Act), or any amendment or supplement to the Prospectus, or any Issuer Free Writing Prospectus or any amendment or supplement thereto, will furnish the Underwriters with copies of any such documents a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object. The Company has given the Representatives notice of any filings made pursuant to the Exchange Act or Exchange Act Regulations within 48 hours prior to the Applicable Time; the Company will give the Representatives notice of its intention to make any such filing from the Applicable Time to the later to occur of the Closing Date and the completion of the distribution of the Notes and will furnish the Underwriters with copies of any such documents a reasonable amount of time prior to such proposed filing and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object. For the purposes of clarity, nothing in this Section 5(b) shall restrict the Company from making any filings required under the Exchange Act or the Exchange Act Regulations.
(c)
If by the third anniversary (the “
Renewal Deadline
”) of the initial effective date of the Registration Statement, any of the Notes remain unsold by the Underwriters, at the request of the Representatives, the Company will file, if it has not already done so and is eligible to do so, a new shelf registration statement relating to the Notes, in a form satisfactory to the Representatives, and will use its reasonable best efforts to cause such registration statement to be declared effective within 180 days after the Renewal Deadline. The Company will take all other action necessary or appropriate to permit the public offering and sale of the Notes to continue as contemplated in the expired registration statement relating to the Notes. References herein to the Registration Statement shall include such new automatic shelf registration statement or such new shelf registration statement, as the case may be.
(d)
The Company will, upon request, deliver to the Underwriters, without charge, (i) a signed copy of the Initial Registration Statement as originally filed, any Rule 462(b) Registration Statement and of each amendment to each (including exhibits filed therewith or incorporated by reference therein) and signed copies of all consents and certificates of experts and (ii) a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for the Underwriters. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(e)
The Company has delivered to the Underwriters, without charge, as many electronic copies of each Preliminary Prospectus as the Representatives reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the Securities Act. The Company will furnish to the Underwriters, without charge, prior to 5:30 P.M. (New York City time) on the second business day next succeeding the date of this Agreement and from time to time thereafter during the period when the Prospectus is required to be delivered in connection with sales of the Notes under the Securities Act or the Exchange Act or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act, such number of electronic copies of the Prospectus (as amended or supplemented) as the Underwriters may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(f)
The Company will comply in all material respects with the Securities Act and the Securities Act Regulations so as to permit the completion of the distribution of the Notes as contemplated in this Agreement and in the Prospectus. If at any time when, in the opinion of counsel for the Underwriters, a prospectus is required to be delivered in connection with sales of the Notes under the Securities Act or the Exchange Act (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act), any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the same will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein
11
not misleading (in the case of the Prospectus, in the light of the circumstances existing at the time it (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is delivered to a purchaser), or if it shall be necessary, in the opinion of either such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the Securities Act or the Securities Act Regulations, the Company will promptly prepare and file with the Commission, subject to Section 5(b) herein, such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish to the Underwriters such number of written and electronic copies of such amendment or supplement as the Underwriters may reasonably request, (i) if such untrue statement or omission was made in reliance upon and in conformity with the Underwriter Information, and (ii) in other cases, without charge to any Underwriter. The Company will provide the Representatives with notice of the occurrence of any event during the period specified above that may give rise to the need to amend or supplement the Registration Statement or the Prospectus as provided in the preceding sentence promptly after the occurrence of such event.
(g)
The Company will make generally available (within the meaning of Section 11(a) of the Securities Act) to its security holders and to the Representatives as soon as practicable, but not later than 45 days after the end of its fiscal quarter in which the first anniversary date of the effective date of the Registration Statement occurs, an earnings statement, which need not be audited (in form complying with the provisions of Rule 158 under the Securities Act), covering a period of at least twelve consecutive months beginning after the effective date of the Registration Statement.
(h)
The Company will use the net proceeds received by it from the sale of the Notes in the manner specified in the Pricing Prospectus under the heading “Use of Proceeds”.
(i)
During the period beginning on the date hereof and continuing to and including the Closing Date, the Company will not, and will not permit any Subsidiary to, without the prior written consent of the Representatives, directly or indirectly, issue, sell, offer or contract to sell, grant any option for the sale of, or otherwise transfer or dispose of, any debt securities or nonconvertible preferred stock of the Company or any of its Subsidiaries.
(j)
The Company, during the period when a prospectus is required to be delivered in connection with sales of the Notes under the Securities Act or the Exchange Act (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act), will (i) file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and the Exchange Act Regulations and (ii) file with the Commission such information on Form 10-Q or Form 10-K as may be required pursuant to Rule 463 under the Securities Act.
(k)
During a period of five years from the effective date of the Registration Statement, the Company will furnish to the Underwriters copies of all reports or other communications (financial or other) furnished to shareholders generally, and to deliver to the Underwriters (i) as soon as they are available, copies of any reports and financial statements furnished to or filed with the Commission or any national securities exchange on which any class of securities of the Company is listed and (ii) such additional public information concerning the business, financial condition, cash flows, capital and results of operations of the Company as the Underwriters may from time to time reasonably request (such financial statements to be on a consolidated basis to the extent the accounts of the Company and the Subsidiaries are consolidated in reports furnished to its shareholders generally or to the Commission); provided that, in the case of clauses (i) and (ii), the Company shall be deemed to have furnished and delivered any such report, communication, financial statement, document, information or other document if and when such report, communication, financial statement, document, information or other document is available through EDGAR on the Commission’s website.
(l)
If the Company elects to rely upon Rule 462(b) under the Securities Act, the Company will file a Rule 462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and at the time of filing either pay to the Commission the filing fee for the Rule 462(b) Registration Statement or give irrevocable instructions for the payment of such fee pursuant to Rule 111 under the Securities Act.
12
(m)
If so requested by the Representatives, the Company shall cause to be prepared and delivered, at its expense, within two business days from the effective date of this Agreement, to the Underwriters an “electronic Prospectus” to be used by the Underwriters in connection with the offering and sale of the Notes. As used herein, the term “electronic Prospectus” means a form of the most recent Preliminary Prospectus, the Pricing Prospectus, any Issuer Free Writing Prospectus or the Prospectus, and any amendment or supplement thereto, that meets each of the following conditions: (i) it shall be encoded in an electronic format, satisfactory to the Representatives, that may be transmitted electronically by the Representatives and the other Underwriters to offerees and purchasers of the Notes, (ii) it shall disclose the same information as such paper Preliminary Prospectus, the Pricing Prospectus, such Issuer Free Writing Prospectus, the Prospectus or such amendment or supplement as the case may be; and (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory to the Representatives, that will allow investors to store and have continuously ready access to such Preliminary Prospectus, the Pricing Prospectus, such Issuer Free Writing Prospectus, the Prospectus or such amendment or supplement at any future time, without charge to investors (other than any fee charged for subscription to the Internet generally). The Company hereby confirms that, if so requested by the Representatives, it has included or will include in a document filed with the Commission an undertaking that, upon receipt of a request by an investor or his or her representative, the Company shall transmit or cause to be transmitted promptly, without charge, a paper copy of such paper Preliminary Prospectus, the Pricing Prospectus, such Issuer Free Writing Prospectus, the Prospectus or such amendment or supplement to such investor or representative.
(n)
Prior to the Applicable Time, the Company will prepare and deliver to the Underwriters the Final Term Sheet set forth in Schedule II in form and substance satisfactory to the Representatives. The Company represents and agrees that, unless it obtains the prior consent of the Representatives, and each Underwriter represents and agrees that, unless it obtains the prior consent of the Company and the Representatives, it has not made and will not make any offer relating to the Notes that would constitute an “issuer free writing prospectus,” as defined in Rule 433, or that would otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with the Commission. The Final Term Sheet and any such free writing prospectus consented to by the Representatives or by the Company, as the case may be, is hereinafter referred to as a “
Permitted Free Writing Prospectus
” and is listed on
Schedule III
hereto. The Company represents that it has treated or agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has complied and will comply with the requirements of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where required, legending and record keeping.
(o)
The Company shall use its commercially reasonable best efforts to permit the Notes to be eligible for clearance, settlement and trading in book-entry-only form through the facilities of DTC.
(p)
The Company shall use its best efforts to obtain a subordinated debt rating from Kroll Bond Rating Agency, Inc. (“
Kroll
”) with regard to the Notes.
6.
(a)
Each Underwriter represents and agrees that, without the prior consent of the Company, it has not made and will not make any offer relating to the Notes that would constitute a free writing prospectus required to be filed with the Commission; any such free writing prospectus the use of which has been consented to by the Company and the Representatives is listed on
Schedule III
hereto.
(b)
The Company has complied and will comply with the requirements of Rule 433 under the Securities Act applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission or retention where required and legending; and the Company represents that it has satisfied and agrees that it will satisfy the conditions under Rule 433 under the Securities Act to avoid a requirement to file with the Commission any electronic road show.
(c)
The Company agrees that if at any time following issuance of an Issuer Free Writing Prospectus any event occurred or occurs as a result of which such Issuer Free Writing Prospectus would conflict with the information in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus or would include an untrue statement of a material fact or omit to state any material fact necessary in
13
order to make the statements therein, in light of the circumstances under which they were made, not misleading, the Company will give prompt notice thereof to the Representatives and, if requested by the Representatives, will prepare and furnish without charge to each Underwriter an Issuer Free Writing Prospectus or other document which will correct such conflict, statement or omission; provided, however, that this representation and warranty shall not apply to any statements or omissions in an Issuer Free Writing Prospectus made in reliance upon and in conformity with the Underwriter Information.
(d)
The Company will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Notes and will not take any action prohibited by Regulation M under the Exchange Act in connection with the distribution of the Notes contemplated hereby.
7.
The Company will use its reasonable best efforts, in cooperation with the Representatives, to qualify the Notes for offering and sale under the applicable securities laws of such states and other jurisdictions as the Representatives may designate and to maintain such qualifications in effect for a period as long as may be necessary to complete the distribution of the Notes; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject. The Company will also supply the Representatives with such information as is necessary for the determination of the legality of the Notes for investment under the laws of such jurisdictions as the Representatives may request.
8.
The Company covenants and agrees with the Underwriters that, whether or not the transactions contemplated by this Agreement are consummated, the Company will pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel, accountants and other advisors; (ii) filing fees and all other expenses in connection with the preparation, printing and filing of the Registration Statement, the Basic Prospectus, each Preliminary Prospectus, the Pricing Prospectus, any Issuer Free Writing Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (iii) the cost of printing or producing this Agreement, closing documents (including any compilations thereof) and such other documents as may be required in connection with the offering, purchase, sale and delivery of the Notes; (iv) all expenses in connection with the qualification of the Notes for offering and sale under state securities laws as provided in Section 7, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky survey up to $5,000; (v) the fees and expenses of the Trustee, including the reasonable fees and disbursements of counsel for the Trustee in connection with the Indenture and the Notes; (vi) the filing fees incident to, and the reasonable fees and disbursements of counsel for the Underwriters in connection with, securing any required review by the Financial Industry Regulatory Authority (“
FINRA
”) of the terms of the sale of the Notes; (vii) all fees and expenses in connection with the preparation, issuance and delivery of the certificates representing the Notes to the Underwriters, including any transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Notes to the Underwriters; (viii) the cost and charges of any paying agent or registrar; (ix) the transportation and other expenses incurred by the Company in connection with presentations to prospective purchasers of Notes; (x) any fees and expenses payable in connection with rating of the Notes or making the Notes eligible for clearance, settlement and trading in book-entry-only form through the facilities of DTC; and (xi) all other costs and expenses incurred by the Company incident to the performance of the Company’s obligations hereunder which are not otherwise specifically provided for in this Section.
9.
The obligations of the Underwriters hereunder to purchase the Notes on the Closing Date are subject to the performance by the Company of its obligations hereunder and to the following additional conditions:
(a)
The Pricing Prospectus and the Prospectus shall have been filed with the Commission pursuant to Rule 424(b) under the Securities Act within the applicable time period prescribed for such filing by the Securities Act Regulations and in accordance with Section 5(a); all material required to be filed by the Company pursuant to Rule 433(d) under the Securities Act shall have been filed with the Commission within the applicable time period prescribed for such filing by Rule 433 under the Securities Act; if the Company has elected to rely upon Rule 462(b) under the Securities Act, the Rule 462(b) Registration Statement shall have become effective by
14
10:00 P.M., Washington, D.C. time, on the date of this Agreement; no stop order suspending the effectiveness of the Registration Statement or any part thereof or the Pricing Prospectus or the Prospectus or any part thereof or any Issuer Free Writing Prospectus shall have been issued and no reasonable satisfaction.
(b)
The representations and warranties of the Company contained herein are true and correct on and at the Closing Date as if made on and at the Closing Date, and the Company shall have complied with all agreements and all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date.
(c)
(i)
The Company (on a consolidated basis) shall not have sustained since the date of the latest audited financial statements included in the Registration Statement, the Pricing Prospectus or the Prospectus any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Registration Statement, the Pricing Prospectus and the Prospectus, and (ii) since the respective dates as of which information is given in the Registration Statement, the Pricing Prospectus and the Prospectus, (1) there shall not have been any change in the capital stock (except any change from (A) the exercise of options to acquire Common Shares granted pursuant to the Company’s benefit plans or (B) the issuance of Common Shares pursuant to the Company’s stock incentive plans, dividend reinvestment plans, retirement plans, senior officer retirement plans or 401(k) plans) or long-term debt (except any change from the repayment of any Federal Home Loan Bank advance or borrowing upon its maturity) of the Company on a consolidated basis or (2) there shall not have been any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, business, prospects, management, financial position, shareholders’ equity or results of operations of the Company and the Subsidiaries, considered as one enterprise, the effect of which, in any such case described in clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Notes being delivered at such Closing Date, on the terms and in the manner contemplated in the Pricing Prospectus.
(d)
The Underwriters shall have received on and at the Closing Date a certificate of two executive officers of the Company, at least one of whom has specific knowledge about the Company’s financial matters, satisfactory to the Representatives, to the effect (i) that the matters set forth in Section 9(a) and (b) are true and correct (with respect to the respective representations, warranties, agreements and conditions of the Company), (ii) that none of the situations set forth in clause (i) or (ii) of Section 9(c) shall have occurred and (iii) that no stop order suspending the effectiveness of the Registration Statement has been issued and to the knowledge of the Company, no proceedings for that purpose have been instituted or are pending or, to the knowledge of such officers, contemplated by the Commission.
(e)
On the Closing Date, the Underwriters shall have received the favorable opinion and letter, dated the Closing Date, of Sherman
&
Howard L.L.C., counsel for the Company, in form and substance satisfactory to counsel for the Underwriters, to the effect set forth in
Exhibit A
hereto.
(f)
On the Closing Date, the Underwriters shall have received the favorable opinion, dated the Closing Date, of Sidley Austin LLP, counsel for the Underwriters, in form and substance satisfactory to the Underwriters, with respect to the due authorization, validity, binding effect and enforceability of the Notes and other related matters as the Underwriters may request; and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such opinion. In giving such opinion, such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of New York and the federal law of the United States, upon the opinions of counsel satisfactory to the Underwriters. Such counsel may also state that, insofar as such opinion involves factual matters, it has relied, to the extent it deems proper, upon certificates of officers of the Company and its Subsidiaries and certificates of public officials.
(g)
At the time of execution of this Agreement, Crowe Horwath LLP shall have furnished to the Underwriters a letter, dated the date of delivery thereof, in form and substance satisfactory to the Underwriters, containing statements and information of the type customarily included in accountants’ “comfort letters” to Underwriters with respect to the financial statements and other financial information contained in the Registration Statement, the Pricing Prospectus and the Prospectus.
15
(h)
On the Closing Date, the Underwriters shall have received from Crowe Horwath LLP a letter, dated the Closing Date, to the effect that they reaffirm the statements made in the letter or letters furnished pursuant to Section 9(g) except that the specified date referred to shall be a date not more than three business days prior to the Closing Date.
(i)
FINRA shall not have raised any objection with respect to the fairness and reasonableness of the underwriting terms and conditions.
(j)
On the date of this Agreement, the Notes shall be rated at least BBB by Kroll and the Company shall have delivered to the Representatives a letter dated the date hereof, from Kroll, or other evidence satisfactory to the Representatives, confirming that the Notes have such rating; such letter shall be in full force and effect at the Closing Date. Subsequent to the execution and delivery of this Agreement and on or prior to the Closing Date, there shall not have occurred any downgrading in or withdrawal of the rating of the Notes or any other securities issued or guaranteed by the Company or any review or possible change of the rating of the Notes that does not indicate an improvement, or any notice relating to any of the foregoing, in each case by any “nationally recognized statistical rating organization,” as defined in Section 3(a)(62) of the Exchange Act.
(k)
On the Closing Date, the Notes shall be eligible for clearance, settlement and trading in book-entry-only form through the facilities of DTC.
(l)
On or after the Applicable Time, there shall not have occurred (i) a suspension or material limitation in trading in securities generally on the NASDAQ or the New York Stock Exchange, (ii) a suspension or material limitation in trading in the Company’s securities on the NASDAQ, (iii) a general moratorium on commercial banking activities declared by any of Federal, New York State, Colorado State or Arizona State authorities or a material disruption in commercial banking or securities settlement or clearance services in the United States, (iv) the outbreak or escalation of hostilities involving the United States or the declaration by the United States of a national emergency or war or (v) the occurrence of any other calamity or crisis or any change in financial, political or economic conditions in the United States or elsewhere, if the effect of any such event specified in clause (iv) or (v) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Notes being delivered at such Closing Date, on the terms and in the manner contemplated in the Prospectus.
(m)
On or prior to the Closing Date, the Company shall have furnished to the Representatives such further information, certificates and documents as the Representatives shall reasonably request.
If any condition specified in this Section 9 shall not have been fulfilled when and as required to be fulfilled, this Agreement may be terminated, subject to the provisions of Section 13, by the Representatives by notice to the Company at any time at or prior to the Closing Date, and such termination shall be without liability of any party to any other party, except as provided in Section 13.
10.
(a)
The Company agrees to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act against any and all losses, liabilities, claims, damages and expenses whatsoever as incurred (including, without limitation, reasonable attorneys’ fees and any and all reasonable expenses whatsoever incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, and any and all amounts paid in settlement of any claim or litigation), joint or several, to which they or any of them may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages or expenses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Initial Registration Statement, as originally filed or any amendment thereof, the Registration Statement, or any post-effective amendment thereof, the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or in any supplement thereto or amendment thereof, any Issuer Free Writing Prospectus, or any “issuer information” filed or required to be filed pursuant to Rule 433(d) under the Securities Act, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading;
16
provided, however, that the Company will not be liable in any such case to the extent that any such loss, liability, claim, damage or expense arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made in the Initial Registration Statement, as originally filed or any amendment thereof, the Registration Statement, or any post-effective amendment thereof, the Basic Prospectus, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or in any supplement thereto or amendment thereof, or any Issuer Free Writing Prospectus in reliance upon and in conformity with the Underwriter Information.
(b)
Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, each of the directors of the Company, each of the officers of the Company who shall have signed the Registration Statement, and each other person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, against any losses, liabilities, claims, damages and expenses whatsoever as incurred (including, without limitation, reasonable attorneys’ fees and any and all reasonable expenses whatsoever incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, and any and all amounts paid in settlement of any claim or litigation), joint or several, to which they or any of them may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages or expenses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Initial Registration Statement, as originally filed or any amendment thereof, the Registration Statement, or any post-effective amendment thereof, the Basic Prospectus, or any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or in any supplement thereto or amendment thereof, or any Issuer Free Writing Prospectus, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that any such loss, liability, claim, damage or expense arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Company by or on behalf of such Underwriter through the Representatives expressly for use therein, it being understood and agreed that the only such information furnished by such Underwriter through the Representatives to the Company up to the date hereof consists of the following information in the Prospectus:
The statements with respect to the offering of the Notes by the Underwriters set forth in the third sentence of the sixth paragraph and the first and fourth sentences of the seventh paragraph, in each case under the “Underwriting” section of the Pricing Prospectus and the Prospectus.
(c)
Promptly after receipt by an indemnified party under Section 10(a) or 10(b) of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such Section, notify each party against whom indemnification is to be sought in writing of the commencement thereof (but the failure so to notify an indemnifying party shall not relieve it from any liability which it may have under this Section 10 except to the extent that it has been materially prejudiced by such failure). In case any such action is brought against any indemnified party, and it notifies an indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein, and jointly with any other indemnifying party similarly notified, to the extent it may elect by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party (who shall not, except with the prior written consent of the indemnified party, be counsel to the indemnified party). Notwithstanding the foregoing, the indemnified party or parties shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such indemnified party or parties unless (i) the employment of such counsel shall have been authorized in writing by one of the indemnifying parties in connection with the defense of such action, (ii) the indemnifying parties shall not have employed counsel to have charge of the defense of such action within a reasonable time after notice of commencement of the action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to one or all of the indemnifying parties (in which case the indemnifying parties shall not have the right to assume or direct the defense of such action on behalf of the indemnified party or parties), in any of which events such fees and expenses shall be borne by the indemnifying parties. In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, which counsel, in the event of indemnified parties under Section 10(a) shall be selected by the Representatives. No indemnifying party shall,
17
without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.
(d)
If the indemnification provided for in this Section 10 is unavailable to or insufficient to hold harmless an indemnified party under Section 10(a) or Section 10(b) in respect of any losses, liabilities, claims, damages or expenses (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, liabilities, claims, damages or expenses (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Notes. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other from the offering of the Notes shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover page of the Prospectus. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or the Underwriters on the other and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 10(d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for this purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 10(d). The amount paid or payable by an indemnified party as a result of the losses, liabilities, claims, damages or expenses (or actions in respect thereof) referred to above in this Section 10(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 10(d), no Underwriters shall be required to contribute any amount in excess of the amount by which the total price at which the Notes underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which the Underwriters has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. The Underwriters’ obligations to contribute pursuant to this Section 10 are several in proportion to their respective purchase obligations hereunder and not joint.
No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
(e)
The obligations of the parties to this Agreements contained in this Section 10 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
11.
(a)
If, on the Closing Date, any Underwriter defaults on its obligation to purchase the Notes that it has agreed to purchase hereunder, the non-defaulting Underwriters may in the discretion of the Representatives arrange for the purchase of such Notes by other persons satisfactory to the Company on the terms contained in this Agreement. If, within 36 hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for the purchase of such Notes, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting Underwriters to purchase such
18
Notes on such terms. If other persons become obligated or agree to purchase the Notes of a defaulting Underwriter, either the non-defaulting Underwriters or the Company may postpone the Closing Date for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement and the Prospectus or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Registration Statement and the Prospectus that effects any such changes. As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule I hereto that, pursuant to this Section 11, purchases Notes that a defaulting Underwriter agreed but failed to purchase.
(b)
If, after giving effect to any arrangements for the purchase of the Notes of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in paragraph (a) above, the aggregate principal amount of Notes that remain unpurchased on the Closing Date does not exceed one-eleventh of the aggregate principal amount of Notes to be purchased hereunder, then the Company shall have the right to require each non-defaulting Underwriter to purchase the amount of Notes that such Underwriter agreed to purchase hereunder on such date plus such Underwriter’s pro rata share (based on the principal amount of Notes that such Underwriter agreed to purchase) of the Notes of such defaulting Underwriter or Underwriters for which such arrangements have not been made.
(c)
If, after giving effect to any arrangements for the purchase of the Notes of a defaulting Underwriter or Underwriters by the non-defaulting Underwriters and the Company as provided in paragraph (a) above, the aggregate principal amount of Notes that remain unpurchased on the Closing Date exceeds one-eleventh of the aggregate principal amount of Notes to be purchased hereunder, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part of the non-defaulting Underwriters. Any termination of this Agreement pursuant to this Section 11 shall be without liability on the part of the Company, except that the Company will continue to be liable for the payment of expenses as set forth in Section 8 hereof and except that the provisions of Section 10 hereof shall not terminate and shall remain in effect.
(d)
Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company or any non-defaulting Underwriter for damages caused by its default.
12.
Notwithstanding anything herein contained, this Agreement may be terminated, subject to the provisions of Section 13, in the absolute discretion of the Representatives, by notice given to the Company, if after the execution and delivery of this Agreement and on or prior to the Closing Date any of the following shall have occurred: (i) a suspension or material limitation in trading in securities generally on the NASDAQ or the New York Stock Exchange; (ii) a suspension or material limitation in trading in the Company’s securities on the NASDAQ; (iii) a general moratorium on commercial banking activities declared by any of Federal, New York State, Colorado State or Arizona State authorities or a material disruption in commercial banking or securities settlement or clearance services in the United States; (iv) the outbreak or escalation of hostilities involving the United States or the declaration by the United States of a national emergency or war; or (v) the occurrence of any other calamity or crisis or any change in financial, political or economic conditions in the United States or elsewhere, if the effect of any such event specified in clause (iv) or (v) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Notes being delivered at such Closing Date, on the terms and in the manner set forth in the Prospectus.
If this Agreement is terminated pursuant to this Section, such termination will be without liability of any party to any other party except as provided in Section 13 herein.
13.
The respective indemnities, agreements, representations, warranties and other statements of the Company or its officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of the Underwriters, the Company or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Notes. If this Agreement is terminated pursuant to Section 12 or if for any reason the purchase of any of the Notes by the Underwriters is not consummated, the Company shall remain responsible for the expenses to be paid or reimbursed by it pursuant to Section 8 (provided, however, that in no event shall the amount of such reimbursement to or on behalf of the Underwriters or their counsel exceed $50,000),
19
the respective obligations of the Company and the Underwriters pursuant to Section 10 and the provisions of this Section 13 and Section 14 and Section 17 shall remain in effect and, if any Notes have been purchased hereunder the representations and warranties in Section 1 and all obligations under Section 5 and Section 6 shall also remain in effect. Subject to the immediately preceding sentence, if this Agreement shall be terminated by the Representatives under Section 9 (other than Section 9(l)) or otherwise because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement or any condition of the Underwriters’ obligations cannot be fulfilled, the Company agrees to reimburse the Underwriters for all out-of-pocket expenses (including the fees and expenses of its counsel) reasonably incurred by the Underwriters in connection with this Agreement or the offering contemplated hereunder, but the Company shall then be under no further liability to the Underwriters except as provided in Section 10.
14.
This Agreement shall inure to the benefit of and be binding upon the Company and the Underwriters, the officers and directors of the Company referred to herein, any controlling persons referred to herein and their respective successors and assigns. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. No purchaser of Notes from the Underwriters shall be deemed to be a successor or assign by reason merely of such purchase.
15.
All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given upon receipt thereof by the recipient if mailed or transmitted by any standard form of telecommunication. Notices to the Underwriters shall be given to the Representatives c/o J.P. Morgan Securities LLC, 270 Park Avenue, New York, New York 10017, Attention: Investment Grade Syndicate Desk (tel. no. (212) 834-4533) and Keefe, Bruyette & Woods, Inc., 787 Seventh Avenue, 5th Floor, New York, New York 10019 (fax no.: (212) 497-8105), Attention: Brian Heller, Esq. Notices to the Company shall be given to it at 821 17th Street, Denver, Colorado 80202 (fax no.: (720) 264-1958); Attention: Lyne Andrich, Executive Vice President and Chief Financial Officer.
16.
This Agreement may be signed in counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument. In the event that any signature to this Agreement or any amendment hereto is delivered by facsimile transmission or by e-mail delivery of a “.pdf’ format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf’ signature page were an original thereof. At the request of any party each other party shall promptly re-execute an original form of this Agreement or any amendment hereto and deliver the same to the other party. No party hereto shall raise the use of a facsimile machine or e-mail delivery of a “.pdf’ format data file to deliver a signature to this Agreement or any amendment hereto or the fact that such signature was transmitted or communicated through the use of a facsimile machine or e-mail delivery of a “.pdf’ format data file as a defense to the formation or enforceability of a contract, and each party hereto forever waives any such defense.
17.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICTS OF LAWS.
18.
The parties hereby submit to the jurisdiction of and venue in the state or federal courts located in New York, New York in connection with any dispute related to this Agreement, any transaction contemplated hereby, or any other matter provided herein.
19.
The Company acknowledges and agrees that (i) the purchase and sale of the Notes pursuant to this Agreement, including the determination of the public offering price of the Notes and any related discounts and commissions, is an arm’s-length commercial transaction between the Company on the one hand, and the Underwriters, on the other, (ii) in connection therewith and with the process leading to such transaction each Underwriter is acting solely as a principal and not the agent or fiduciary of the Company or its respective stockholders, creditors, employees or any other party, (iii) each Underwriter has not assumed an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising the Company or its
20
affiliates on other matters) or any other obligation to the Company except the obligations expressly set forth in this Agreement, and (iv) the Company has consulted its own legal and financial advisors to the extent it deemed appropriate. The Company agrees that it will not claim that an Underwriter has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty, to the Company, in connection with the offering contemplated hereby or the process leading thereto.
20.
Notwithstanding anything herein to the contrary, the Company is authorized to disclose to any persons the U.S. federal and state income tax treatment and tax structure of the potential transaction and all materials of any kind (including tax opinions and other tax analyses) provided to the Company relating to that treatment and structure, without the Underwriters imposing any limitation of any kind. However, any information relating to the tax treatment and tax structure shall remain confidential (and the foregoing sentence shall not apply) to the extent necessary to enable any person to comply with securities laws. For this purpose, “tax structure” is limited to any facts that may be relevant to that treatment.
21.
This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and the Underwriters, or any of them, with respect to the subject matter hereof
22.
The Company and the Underwriters hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
23.
The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party.
24.
Terms for which meanings are defined in this Agreement shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine and feminine forms. The term “including,” whenever used in any provision of this Agreement, means including but without limiting the generality of any description preceding or succeeding such term. Each reference to a person or entity shall include a reference to the successors and assigns of such person or entity.
[
Signatures appear on the following pages
]
21
If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument will become a binding agreement between the Company and the Underwriters.
Very truly yours,
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COBIZ FINANCIAL INC.
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By:
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/s/ Lyne Andrich
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Name: Lyne Andrich
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Title: EVP & CFO
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[Signature Page to Underwriting Agreement]
Accepted as of the date hereof
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J.P. MORGAN SECURITIES LLC
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By:
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/s/ Stephen L. Sheiner
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Name:
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Stephen L. Sheiner
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Title:
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Executive Director
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KEEFE, BRUYETTE & WOODS, INC.
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By:
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/s/ Patrick Koster
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Name:
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Patrick Koster
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Title:
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Managing Director
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For themselves and on behalf of the several Underwriters listed in Schedule I hereto.
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[Signature Page to Underwriting Agreement]
SCHEDULE I
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Underwriter
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Aggregate Principal
Amount of Securities
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J.P. Morgan Securities LLC
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$
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30,000,000
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Keefe, Bruyette & Woods, Inc.
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$
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30,000,000
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Total
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$
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60,000,000
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I-
1
SCHEDULE II
Final Term Sheet
Filed Pursuant to Rule 433
Relating to Preliminary Prospectus Supplement dated June 22, 2015
Prospectus dated August 21, 2013
Registration No. 333-
190361
CoBiz Financial Inc.
$60,000,000
5.625% Fixed to Floating Rate Subordinated Notes due 2030
Final Term Sheet
June 22, 2015
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Issuer:
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CoBiz Financial Inc
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Security Type:
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5.625% Fixed to Floating Rate Subordinated Notes due 2030
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Security Ratings:*
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[Reserved]
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Principal Amount:
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$60,000,000
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Pricing Date:
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June 22, 2015
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Settlement Date:
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June 25, 2015 (T+3)
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Stated Maturity Date:
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June 25, 2030
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Interest Payment Dates:
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Each June 25 and December 25, commencing December 25, 2015, through June 25, 2025, and thereafter March 25, June 25, September 25 and December 25 of each year through the Stated Maturity Date, unless in any case previously redeemed
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Interest Rate:
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Unless previously redeemed, the notes will bear interest (i) from, and including, the settlement date to, but excluding, June 25, 2025, at a fixed rate equal to 5.625% per year and (ii) from, and including, June 25, 2025, at an annual floating rate equal to three-month LIBOR, as determined quarterly on the determination date for the applicable interest period, plus 317 basis points (3.17%).
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Price to Public:
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100% of Principal Amount
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Underwriting Discount:
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1.25% of Principal Amount
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Net Proceeds to Issuer (after underwriting discount, but before expenses):
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$59,250,000
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Optional Redemption; Redemption Upon Special Events:
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Subject to obtaining the prior approval of the Federal Reserve, to the extent such approval is then required, we may, at our option, beginning with the interest payment date of June 25, 2025 and on any interest payment date thereafter, redeem the notes in whole or in part at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date.
In addition, subject to obtaining the prior approval of the Federal Reserve, to the extent such approval is then required, we may, at our option, redeem the notes in whole but not in part upon the occurrence of (1) a “Tax Event,” (2) a “Tier 2 Capital Event” or (3) a “1940 Act Event,” in each case, at a redemption price equal to 100% of the principal amount of the notes, plus any accrued and unpaid interest to, but excluding, the redemption date.
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II-
1
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Subordination:
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The notes will be subordinate in right of payment to all senior indebtedness of the Company as described in the preliminary prospectus supplement and the accompanying prospectus.
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CUSIP / ISIN:
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190897 AA6 / US190897AA60
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Book-Running Managers:
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J.P. Morgan Securities LLC
Keefe, Bruyette & Woods, Inc.,
A Stifel Company
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*
Note:
A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.
The issuer has filed a registration statement (including a preliminary prospectus supplement and an accompanying prospectus) with the Securities and Exchange Commission (the “SEC”) for the offering to which this communication relates. Before you invest, you should read the preliminary prospectus supplement and prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus supplement and prospectus if you request it by calling
J.P. Morgan Securities LLC collect at (212) 834-4533 or Keefe, Bruyette & Woods, Inc.
toll-free at (800) 966-1559.
SCHEDULE III
Final Term Sheet on Schedule II hereto
Exhibit 4.1
COBIZ FINANCIAL INC.,
as Issuer
INDENTURE
Dated as of June 25, 2015
U.S. Bank National Association,
as Trustee
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE
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1
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Section 1.1
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Definitions
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1
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Section 1.2
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Other Definitions
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5
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Section 1.3
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Incorporation by Reference of Trust Indenture Act
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6
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Section 1.4
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Rules Of Construction
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6
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ARTICLE II THE SECURITIES
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6
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Section 2.1
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Issuable In Series
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6
|
|
Section 2.2
|
Establishment Of Terms Of Series Of Securities
|
|
7
|
|
Section 2.3
|
Execution and Authentication
|
|
8
|
|
Section 2.4
|
Registrar and Paying Agent
|
|
9
|
|
Section 2.5
|
P
aying Agent to Hold Money in Trust
|
|
10
|
|
Section 2.6
|
Securityholder Lists
|
|
10
|
|
Section 2.7
|
Transfer and Exchange
|
|
11
|
|
Section 2.8
|
Mutilated, Destroyed, Lost and Stolen Securities
|
|
11
|
|
Section 2.9
|
Outstanding Securities
|
|
12
|
|
Section 2.10
|
Treasury Securities
|
|
12
|
|
Section 2.11
|
Temporary Securities
|
|
12
|
|
Section 2.12
|
Cancellation
|
|
13
|
|
Section 2.13
|
Defaulted Interest
|
|
13
|
|
Section 2.14
|
Global Securities
|
|
13
|
|
Section 2.15
|
CUSIP Numbers
|
|
14
|
|
|
|
|
|
|
ARTICLE III REDEMPTION
|
|
15
|
|
Section 3.1
|
Notice To Trustee
|
|
15
|
|
Section 3.2
|
Selection of Securities to be Redeemed
|
|
15
|
|
Section 3.3
|
Notice of Redemption
|
|
15
|
|
Section 3.4
|
Effect of Notice of Redemption
|
|
16
|
|
Section 3.5
|
Deposit of Redemption Price
|
|
16
|
|
Section 3.6
|
Securities Redeemed in Part
|
|
16
|
|
|
|
|
|
|
ARTICLE IV COVENANTS
|
|
16
|
|
Section 4.1
|
Payment of Principal and Interest
|
|
16
|
|
Section 4.2
|
Commission Reports
|
|
17
|
|
Section 4.3
|
Compliance Certificate
|
|
17
|
|
Section 4.4
|
Stay, Extension and Usury Laws
|
|
17
|
|
Section 4.5
|
Corporate Existence
|
|
17
|
|
Section 4.6
|
Taxes
|
|
18
|
|
|
|
|
|
|
ARTICLE V SUCCESSORS
|
|
18
|
|
Section 5.1
|
When Company May Merge, Etc
.
|
|
18
|
|
Section 5.2
|
Successor Corporation Substituted
|
|
18
|
|
|
|
|
|
|
ARTICLE VI DEFAULTS AND REMEDIES
|
|
19
|
|
Section 6.1
|
Events of Default
|
|
19
|
i
|
Section 6.2
|
Acceleration of Maturity
|
|
20
|
|
Section 6.3
|
Collection Of Indebtedness And Suits For Enforcement By Trustee
|
|
20
|
|
Section 6.4
|
Trustee May File Proofs Of Claim
|
|
21
|
|
Section 6.5
|
Trustee May Enforce Claims Without Possession Of Securities
|
|
22
|
|
Section 6.6
|
Application of Money Collected
|
|
22
|
|
Section 6.7
|
Limitation On Suits
|
|
22
|
|
Section 6.8
|
Unconditional Right of Holders to Receive Principal and Interest
|
|
23
|
|
Section 6.9
|
Restoration of Rights and Remedies
|
|
23
|
|
Section 6.10
|
Rights and Remedies Cumulative
|
|
23
|
|
Section 6.11
|
Delay or Omission Not Waiver
|
|
23
|
|
Section 6.12
|
Control by Holders
|
|
24
|
|
Section 6.13
|
Waiver Of Past Defaults
|
|
24
|
|
Section 6.14
|
Undertaking For Costs
|
|
24
|
|
|
|
|
|
|
ARTICLE VII TRUSTEE
|
|
25
|
|
Section 7.1
|
Duties of Trustee
|
|
25
|
|
Section 7.2
|
Rights of Trustee
|
|
26
|
|
Section 7.3
|
Individual Rights of Trustee
|
|
27
|
|
Section 7.4
|
Trustee’s Disclaimer
|
|
27
|
|
Section 7.5
|
Notice Of Defaults
|
|
28
|
|
Section 7.6
|
Reports by Trustee to Holders
|
|
28
|
|
Section 7.7
|
Compensation and Indemnity
|
|
28
|
|
Section 7.8
|
Replacement of Trustee
|
|
29
|
|
Section 7.9
|
Successor Trustee by Merger, Etc
.
|
|
30
|
|
Section 7.10
|
Eligibility; Disqualification
|
|
30
|
|
Section 7.11
|
Referential Collection of Claims Against Company
|
|
30
|
|
|
|
|
|
|
ARTICLE VIII SATISFACTION AND DISCHARGE; DEFEASANCE
|
|
30
|
|
Section 8.1
|
Satisfaction and Discharge of Indenture
|
|
30
|
|
Section 8.2
|
Application of Trust Funds; Indemnification
|
|
31
|
|
Section 8.3
|
[Reserved]
|
|
31
|
|
Section 8.4
|
Repayment to Company
|
|
31
|
|
Section 8.5
|
Effect on Subordination Provisions
|
|
32
|
|
|
|
|
|
|
ARTICLE IX AMENDMENTS AND WAIVERS
|
|
32
|
|
Section 9.1
|
Without Consent of Holders
|
|
32
|
|
Section 9.2
|
With Consent of Holders
|
|
33
|
|
Section 9.3
|
Limitations
|
|
33
|
|
Section 9.4
|
Compliance With Trust Indenture Act
|
|
34
|
|
Section 9.5
|
Revocation and Effect of Consents
|
|
34
|
|
Section 9.6
|
Notation on or Exchange of Securities
|
|
34
|
|
Section 9.7
|
Trustee Protected
|
|
34
|
|
|
|
|
|
|
ARTICLE X MISCELLANEOUS
|
|
35
|
|
Section 10.1
|
Trust Indenture Act Controls
|
|
35
|
|
Section 10.2
|
Notices
|
|
35
|
|
Section 10.3
|
Communication by Holders with Other Holders
|
|
36
|
ii
|
Section 10.4
|
Certificate and Opinion as to Conditions Precedent
|
|
36
|
|
Section 10.5
|
Statements Required in Certificate or Opinion
|
|
36
|
|
Section 10.6
|
Rules by Trustee and Agents
|
|
36
|
|
Section 10.7
|
Legal Holidays
|
|
36
|
|
Section 10.8
|
No Recourse Against Others
|
|
37
|
|
Section 10.9
|
Counterparts
|
|
37
|
|
Section 10.10
|
Governing Laws
|
|
37
|
|
Section 10.11
|
No Adverse Interpretation of Other Agreements
|
|
37
|
|
Section 10.12
|
Successors
|
|
37
|
|
Section 10.13
|
Severability
|
|
37
|
|
Section 10.14
|
Table of Contents, Headings, Etc
.
|
|
37
|
|
Section 10.15
|
USA Patriot Act
|
|
37
|
|
|
|
|
|
|
ARTICLE XI [RESERVED]
|
|
38
|
|
ARTICLE XII SUBORDINATION OF SECURITIES
|
|
38
|
|
Section 12.1
|
Agreement of Subordination
|
|
38
|
|
Section 12.2
|
Payments to Holders
|
|
38
|
|
Section 12.3
|
Subrogation of Securities
|
|
41
|
|
Section 12.4
|
Authorization to Effect Subordination
|
|
42
|
|
Section 12.5
|
Notice to Trustee
|
|
42
|
|
Section 12.6
|
Trustee’s Relation to Senior Indebtedness
|
|
43
|
|
Section 12.7
|
No Impairment of Subordination
|
|
43
|
|
Section 12.8
|
Article Applicable to Paying Agents
|
|
43
|
|
Section 12.9
|
Senior Indebtedness Entitled to Rely
|
|
43
|
iii
CROSS REFERENCE TABLE
|
Trust Indenture
|
|
Indenture
|
|
Act Section
|
|
Section
|
|
|
|
|
|
Section 310
|
(a)(1)
|
|
7.10
|
|
|
(a)(2)
|
|
7.10
|
|
|
(a)(3)
|
|
N/A
|
|
|
(a)(4)
|
|
N/A
|
|
|
(a)(5)
|
|
7.10
|
|
|
(b)
|
|
7.10
|
|
Section 311
|
(a)
|
|
7.11
|
|
|
(b)
|
|
7.11
|
|
|
(c)
|
|
N/A
|
|
Section 312
|
(a)
|
|
2.6
|
|
|
(b)
|
|
10.3
|
|
|
(c)
|
|
10.3
|
|
Section 313
|
(a)
|
|
7.6
|
|
|
(b)(1)
|
|
7.6
|
|
|
(b)(2)
|
|
7.6
|
|
|
(c)(1)
|
|
7.6
|
|
|
(d)
|
|
7.6
|
|
Section 314
|
(a)
|
|
4.2, 10.5
|
|
|
(b)
|
|
N/A
|
|
|
(c)(1)
|
|
10.4
|
|
|
(c)(2)
|
|
10.4
|
|
|
(c)(3)
|
|
N/A
|
|
|
(d)
|
|
N/A
|
|
|
(e)
|
|
10.5
|
|
|
(f)
|
|
N/A
|
|
Section 315
|
(a)
|
|
7.1
|
|
|
(b)
|
|
7.5
|
|
|
(c)
|
|
7.1
|
|
|
(d)
|
|
7.1
|
|
|
(e)
|
|
6.14
|
|
Section 316
|
(a)
|
|
2.10
|
|
|
(a)(1)(A)
|
|
6.12
|
|
|
(a)(1)(B)
|
|
6.13
|
|
|
(b)
|
|
6.8
|
|
Section 317
|
(a)(1)
|
|
6.3
|
|
|
(a)(2)
|
|
6.4
|
|
|
(b)
|
|
2.5
|
|
Section 318
|
(a)
|
|
10.1
|
*
This Cross Reference Table shall not, for any purpose, be deemed to be part of the Indenture.
iv
INDENTURE dated as of June 25, 2015 between COBIZ FINANCIAL INC., a Colorado corporation (“
Company
”), and U.S. BANK NATIONAL ASSOCIATION, as trustee (“
Trustee
”).
Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Securities issued under this Indenture:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1
Definitions
.
“
Additional Amounts
” means any additional amounts which are required hereby or by any Security, under circumstances specified herein or therein, to be paid by the Company in respect of certain taxes imposed on Holders specified herein or therein and which are owing to such Holders.
“
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” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such person, whether through the ownership of voting securities or by agreement or otherwise.
“
Agent
” means any Registrar, Paying Agent or Service Agent.
“
Authorized Newspaper
” means a newspaper in an official language of the country of publication customarily published at least once a day for at least five days in each calendar week and of general circulation in the place in connection with which the term is used. If it shall be impractical in the opinion of the Trustee to make any publication of any notice required hereby in an Authorized Newspaper, any publication or other notice in lieu thereof that is made or given by the Trustee shall constitute a sufficient publication of such notice.
“
Bearer
” means anyone in possession from time to time of a Bearer Security.
“
Bearer Security
” means any Security, including any interest coupon appertaining thereto, that does not provide for the identification of the Holder thereof.
“
Board of Directors
” means the Board of Directors of the Company or any duly authorized committee thereof.
“
Board Resolution
” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been adopted by the Board of Directors or pursuant to authorization by the Board of Directors and to be in full force and effect on the date of the certificate and delivered to the Trustee.
“
Business Day
” means, unless otherwise provided by Board Resolution, Officers’ Certificate or supplemental indenture hereto for a particular Series, any day except a Saturday, Sunday or a legal holiday in the City of New York on which banking institutions are authorized or required by law, regulation or executive order to close.
“
Capital Stock
” means any and all shares, interests, participations, rights or other equivalents (however designated) of equity.
“
Commission
” means the Securities and Exchange Commission.
“
Company
” means the party named as such above until a successor replaces it in accordance with the terms of this Indenture and thereafter means the successor.
“
Company Order
” means a written order signed in the name of the Company by two Officers, one of whom must be the Company’s principal executive officer, principal financial officer or principal accounting officer.
“
Corporate Trust Office
” means the office of the Trustee identified in Section 10.2 hereof, as may be changed from time to time in accordance with Section 10.2.
“
Default
” means any event which is, or after notice or passage of time or both would be, an Event of Default.
“
Depository
” means, with respect to the Securities of any Series issuable or issued in whole or in part in the form of one or more Global Securities, the person designated as Depository for such Series by the Company, which Depository shall be a clearing agency registered under the Exchange Act; and if at any time there is more than one such person, “Depository” as used with respect to the Securities of any Series shall mean the Depository with respect to the Securities of such Series.
“
Discount Security
” means any Security that provides for an amount less than the stated principal amount thereof to be due and payable upon declaration of acceleration of the Maturity thereof pursuant to Section 6.2.
“
Dollars
” and “
$
” means the currency of The United States of America.
“
Exchange Act
” means the Securities Exchange Act of 1934, as amended.
“
GAAP
” means U.S. generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect as of the date of determination.
“
Global Security
” or “
Global Securities
” means a Security or Securities, as the case may be, in the form established pursuant to Section 2.2 evidencing all or part of a Series of Securities, issued to the Depository for such Series or its nominee, and registered in the name of such Depository or nominee.
2
“
Holder
” or “
Securityholder
” means a person in whose name a Security is registered or the holder of a Bearer Security.
“
indebtedness
” means, with respect to any person, and without duplication, (a) all indebtedness, obligations and other liabilities (contingent or otherwise) of such person for borrowed money, including overdrafts, foreign exchange contracts, currency exchange agreements, interest rate protection agreements, and any loans or advances from banks or evidenced by bonds, debentures, notes or similar instruments (whether or not the recourse of the lender is to the whole of the assets of such person or to only a portion thereof), other than any account payable or other accrued current liability or obligation incurred in the ordinary course of business in connection with the obtaining of materials or services, (b) all reimbursement obligations and other liabilities (contingent or otherwise) of such person with respect to letters of credit, bank guarantees or bankers’ acceptances, (c) all obligations and liabilities in respect of leases of such person required in conformity with GAAP to be accounted for as capitalized lease obligations on the balance sheet of such person, (d) all obligations and other liabilities under any lease or related document in connection with the lease of real property which provides that such person is contractually obligated to purchase or cause a third party to purchase the leased property and thereby guarantee a minimum residual value of the leased property to the lessor and such person’s obligations under the lease or related document to purchase or to cause a third party to purchase the leased property, (e) all obligations of such person with respect to an interest rate or other swap, cap or collar agreement or other similar instrument or agreement or foreign currency hedge, exchange, purchase agreement or other similar instrument or agreement, (f) all direct or indirect guarantees or similar agreements by such person in respect of, and obligations or liabilities of such person to purchase, acquire or otherwise assure a creditor against loss in respect of, indebtedness, obligations or liabilities of others of the type described in clauses (a) through (e), (g) any indebtedness or other obligations described in clauses (a) through (f) secured by any mortgage, pledge, lien or other encumbrance existing on property which is owned or held by such person, regardless of whether the indebtedness or other obligation secured thereby shall have been assumed by such person and (h) any and all refinancings, replacements, deferrals, renewals, extensions and refundings of, or amendments, modifications or supplements to, any indebtedness, obligation or liability of the kind described in clauses (a) through (g).
“
Indenture
” means this Indenture as amended or supplemented from time to time and shall include the form and terms of particular Series of Securities established as contemplated hereunder.
“
interest
” with respect to any Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity.
“
Maturity
,” when used with respect to any Security or installment of principal thereof, means the date on which the principal of such Security or such 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.
“
Officer
” means the Chief Executive Officer, the President, any Vice President, the Treasurer, the Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.
3
“
Officers’ Certificate
” means a certificate signed by two Officers, one of whom must be the Company’s principal executive officer, principal financial officer or principal accounting officer.
“
Opinion of Counsel
” means a written opinion of legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company.
“
person
” means any individual, corporation, partnership, joint venture, association, limited liability company, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
“
principal
” of a Security means the principal of the Security plus, when appropriate, the premium, if any, on, and any Additional Amounts in respect of, the Security.
“
Representative
” means the (a) indenture trustee or other trustee, agent or representative for any Senior Indebtedness or (b) with respect to any Senior Indebtedness that does not have any such trustee, agent or other representative, (i) in the case of such Senior Indebtedness issued pursuant to an agreement providing for voting arrangements as among the holders or owners of such Senior Indebtedness, any holder or owner of such Senior Indebtedness acting with the consent of the required persons necessary to bind such holders or owners of such Senior Indebtedness and (ii) in the case of all other such Senior Indebtedness, the holder or owner of such Senior Indebtedness.
“
Responsible Officer
” any officer or assistant officer of the Trustee assigned by the Trustee to administer its corporate trust matters in the Trustee’s Corporate Trust Office or to whom a matter concerning the Indenture may be referred.
“
Securities
” means the debentures, notes or other debt instruments of the Company of any Series authenticated and delivered under this Indenture.
“
Senior Indebtedness
” means the principal, premium, if any, interest, including any interest accruing after bankruptcy, and rent or termination payment on or other amounts due on our current or future Indebtedness, whether created, incurred, assumed, guaranteed or in effect guaranteed by us, including any deferrals, renewals, extensions, refundings, amendments, modifications or supplements to the above. However, Senior Indebtedness does not include: (i) indebtedness that expressly provides that it shall not be senior in right of payment to the Securities or expressly provides that it is on the same basis or junior to the Securities; (ii) our indebtedness to any of our majority-owned subsidiaries; and (iii) the Securities.
“
Series
” or “
Series of Securities
” means each series of debentures, notes or other debt instruments of the Company created pursuant to Sections 2.1 and 2.2 hereof.
“
Stated Maturity
” when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.
“
Subsidiary
” of any specified person means any corporation, partnership, limited liability company, association or other business entity of which more than 50% of the total voting power
4
of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such person or one or more of the other Subsidiaries of that person or a combination thereof.
“
Trust Indenture Act
” means the Trust Indenture Act of 1939, as amended.
“
Trustee
” means the person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean each person who is then a Trustee hereunder, and if at any time there is more than one such person, “Trustee” as used with respect to the Securities of any Series shall mean the Trustee with respect to Securities of that Series.
“
U.S. Government Obligations
” means securities which are (i) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (ii) obligations of a person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America, and which in the case of (i) and (ii) are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligation or a specific payment of interest on or principal of any such U.S. Government Obligation held by such custodian for the account of the holder of a depository receipt, 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 depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation evidenced by such depository receipt.
Section 1.2
Other Definitions
.
|
Term
|
|
Defined in Section
|
|
|
|
|
|
“Bankruptcy Law”
|
|
6.1
|
|
“Custodian”
|
|
6.1
|
|
“Event of Default”
|
|
6.1
|
|
“Legal Holiday”
|
|
10.7
|
|
“Paying Agent”
|
|
2.4
|
|
“Payment Blockage Notice
|
|
12.2
|
|
“Registrar”
|
|
2.4
|
|
“Service Agent”
|
|
2.4
|
|
“successor person”
|
|
5.1
|
5
Section 1.3
Incorporation by Reference of Trust Indenture Act
.
Whenever this Indenture refers to a provision of the Trust Indenture Act, the provision is incorporated by reference in and made a part of this Indenture. The following Trust Indenture Act terms used in this Indenture have the following meanings:
“indenture securities” means the Securities.
“indenture security holder” means a Securityholder.
“indenture to be qualified” means this Indenture.
“indenture trustee” or “institutional trustee” means the Trustee.
“obligor” on the indenture securities means the Company and any successor obligor upon the Securities.
All other terms used in this Indenture that are defined by the Trust Indenture Act, defined by Trust Indenture Act reference to another statute or defined by Commission rule under the Trust Indenture Act and not otherwise defined herein are used herein as so defined.
Section 1.4
Rules Of Construction
.
Unless the context otherwise requires:
(a)
a term has the meaning assigned to it;
(b)
an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;
(c)
“or” is not exclusive;
(d)
words in the singular include the plural, and in the plural include the singular; and
(e)
provisions apply to successive events and transactions.
ARTICLE II
THE SECURITIES
Section 2.1
Issuable In Series
.
The aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more Series. All Securities of a Series shall be identical except as may be set forth or determined in the manner provided in a Board Resolution, supplemental indenture or Officers’ Certificate detailing the adoption of the terms thereof pursuant to authority granted under a Board Resolution. In the case of Securities of a Series to be issued from time to time, the Board Resolution, Officers’ Certificate or supplemental indenture detailing the adoption of the terms thereof pursuant to
6
authority granted under a Board Resolution may provide for the method by which specified terms (such as interest rate, maturity date, record date or date from which interest shall accrue) are to be determined. Securities may differ between Series in respect of any matters, provided that all Series of Securities shall be equally and ratably entitled to the benefits of the Indenture, but all Securities issued hereunder shall be subordinate and junior in right of payment, to the extent and in the manner set forth in Article XII, to all Senior Indebtedness of the Company.
Section 2.2
Establishment Of Terms Of Series Of Securities
.
At or prior to the issuance of any Securities within a Series, the following shall be established (as to the Series generally, in the case of Subsection 2.2.1 and either as to such Securities within the Series or as to the Series generally in the case of Subsections 2.2.2 through 2.2.17) by or pursuant to a Board Resolution, and set forth or determined in the manner provided in a Board Resolution, supplemental indenture or an Officers’ Certificate:
2.2.1.
the title of the Series (which shall distinguish the Securities of that particular Series from the Securities of any other Series);
2.2.2.
the price or prices (expressed as a percentage of the principal amount thereof) at which the Securities of the Series will be issued;
2.2.3.
any limit upon the aggregate principal amount of the Securities of the Series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the Series pursuant to Section 2.7, 2.8, 2.11, 3.6 or 9.6);
2.2.4.
the date or dates on which the principal of the Securities of the Series is payable;
2.2.5.
the rate or rates (which may be fixed and/or variable) per annum or, if applicable, the method used to determine such rate or rates (including, but not limited to, any commodity, commodity index, stock exchange index or financial index) at which the Securities of the Series shall bear interest, if any, the date or dates from which such interest, if any, shall accrue, the date or dates on which such interest, if any, shall commence and be payable and any regular record date for the interest payable on any interest payment date;
2.2.6.
the place or places where the principal of and interest, if any, on the Securities of the Series shall be payable, where the Securities of such Series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such Series and this Indenture may be served, and the method of such payment, if by wire transfer, mail or other means;
2.2.7.
if applicable, the period or periods within which, the price or prices at which and the terms and conditions upon which the Securities of the Series may be redeemed, in whole or in part, at the option of the Company;
2.2.8.
the obligation, if any, of the Company to redeem or purchase the Securities of the Series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions
7
upon which Securities of the Series shall be redeemed or purchased, in whole or in part, pursuant to such obligation;
2.2.9.
if applicable, the period or periods within which, and the price or prices at which, the Securities of the Series will be repurchased by the Company at the option of the Holders thereof and other detailed terms and provisions of such repurchase obligations;
2.2.10.
if other than denominations of $2,000 and any integral multiple of $1,000 in excess thereof, the denominations in which the Securities of the Series shall be issuable;
2.2.11.
the forms of the Securities of the Series in Bearer or fully registered form (and, if in fully registered form, whether the Securities will be issuable as Global Securities);
2.2.12.
if other than the principal amount thereof, the portion of the principal amount of the Securities of the Series that shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 6.2;
2.2.13.
the provisions, if any, relating to any security provided for the Securities of the Series;
2.2.14.
any addition to or change in the Events of Default which applies to any Securities of the Series and any change in the right of the Trustee or the requisite Holders of such Securities to declare the principal amount thereof due and payable pursuant to Section 6.2;
2.2.15.
any addition to or change in the covenants set forth in Articles IV or V which applies to Securities of the Series;
2.2.16.
any other terms of the Securities of the Series (which may modify or delete any provision of this Indenture insofar as it applies to such Series); and
2.2.17.
any depositories, interest rate calculation agents, exchange rate calculation agents or other agents with respect to Securities of such Series if other than those appointed herein.
All Securities of any one Series need not be issued at the same time and may be issued from time to time, consistent with the terms of this Indenture, if so provided by or pursuant to the Board Resolution, supplemental indenture hereto or Officers’ Certificate referred to above, and the authorized principal amount of any Series may not be increased to provide for issuances of additional Securities of such Series, unless otherwise provided in such Board Resolution, supplemental indenture or Officers’ Certificate.
Section 2.3
Execution and Authentication
.
Two Officers shall sign the Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall nevertheless be valid.
8
A Security shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.
The Trustee shall at any time, and from time to time, authenticate Securities for original issue in the principal amount provided in the Board Resolution, supplemental indenture hereto or Officers’ Certificate, upon receipt by the Trustee of a Company Order. Such Company Order may authorize authentication and delivery pursuant to oral or electronic instructions from the Company or its duly authorized agent or agents, which oral instructions shall be promptly confirmed in writing. Each Security shall be dated the date of its authentication unless otherwise provided by a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate.
The aggregate principal amount of Securities of any Series outstanding at any time may not exceed any limit upon the maximum principal amount for such Series set forth in the Board Resolution, supplemental indenture hereto or Officers’ Certificate delivered pursuant to Section 2.2, except as provided in Section 2.8.
Prior to the issuance of Securities of any Series, the Trustee shall have received and (subject to Section 7.2) shall be fully protected in relying on: (a) the Board Resolution, supplemental indenture hereto or Officers’ Certificate establishing the form of the Securities of that Series or of Securities within that Series and the terms of the Securities of that Series or of Securities within that Series, (b) an Officers’ Certificate complying with Section 10.4, and (c) an Opinion of Counsel complying with Section 10.4.
The Trustee shall have the right to decline to authenticate and deliver any Securities of such Series: (a) if the Trustee, being advised by counsel, determines that such action may not be taken lawfully; or (b) if the Trustee in good faith by its board of directors or trustees, executive committee or a trust committee of directors and/or Vice Presidents shall determine that such action would expose the Trustee to personal liability to Holders of any then outstanding Series of Securities.
The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate of the Company.
Section 2.4
Registrar and Paying Agent
.
The Company shall maintain, with respect to each Series of Securities, at the place or places specified with respect to such Series pursuant to Section 2.2, an office or agency where Securities of such Series may be presented or surrendered for payment (“
Paying Agent
”), where Securities of such Series may be surrendered for registration of transfer or exchange (“
Registrar
”) and where notices and demands to or upon the Company in respect of the Securities of such Series and this Indenture may be made or served (“
Service Agent
”). The Registrar shall keep a register with respect to each Series of Securities and to their transfer and exchange. The Company will give prompt written notice to the Trustee of the name and address,
9
and any change in the name or address, of each Registrar, Paying Agent or Service Agent. If at any time the Company shall fail to maintain any such required Registrar, Paying Agent or Service Agent or shall fail to furnish the Trustee with the name and address thereof, such presentations, surrenders, notices and demands may be made at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more co-registrars, additional paying agents or additional service agents and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligations to maintain a Registrar, Paying Agent and Service Agent in each place so specified pursuant to Section 2.2 for Securities of any Series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the name or address of any such co-registrar, additional paying agent or additional service agent. The term “Registrar” includes any co-registrar; the term “Paying Agent” includes any additional paying agent; and the term “Service Agent” includes any additional service agent.
The Company hereby appoints the Trustee as the initial Registrar, Paying Agent and Service Agent for each Series unless another Registrar, Paying Agent or Service Agent, as the case may be, is appointed prior to the time Securities of that Series are first issued.
Section 2.5
P
aying Agent to Hold Money in Trust
.
The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent will hold in trust, for the benefit of Securityholders of any Series of Securities, or the Trustee, all money held by the Paying Agent for the payment of principal of or interest on the Series of Securities, and will notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary of the Company) shall have no further liability for the money. If the Company or a Subsidiary of the Company acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of Securityholders of any Series of Securities all money held by it as Paying Agent.
Section 2.6
Securityholder Lists
.
The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders of each Series of Securities and shall otherwise comply with Trust Indenture Act Section 312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least ten days before each interest payment date and at such other times as the Trustee may request in writing a list, in such form and as of such date as the Trustee may reasonably require, of the names and addresses of Securityholders of each Series of Securities.
10
Section 2.7
Transfer and Exchange
.
Where Securities of a Series are presented to the Registrar or a co-registrar with a request to register a transfer or to exchange them for an equal principal amount of Securities of the same Series, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met. To permit registrations of transfers and exchanges, the Trustee shall authenticate Securities of the same Series at the Registrar’s request. No service charge shall be made for any registration of transfer or exchange (except as otherwise expressly permitted herein), but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer tax or similar governmental charge payable upon exchanges pursuant to Sections 2.11, 3.6 or 9.6).
Neither the Company nor the Registrar shall be required (a) to issue, register the transfer of, or exchange Securities of any Series for the period beginning at the opening of business fifteen days immediately preceding the mailing of a notice of redemption of Securities of that Series selected for redemption and ending at the close of business on the day of such mailing, or (b) to register the transfer of or exchange Securities of any Series selected, called or being called for redemption as a whole or the portion being redeemed of any such Securities selected, called or being called for redemption in part.
Section 2.8
Mutilated, Destroyed, Lost and Stolen Securities
.
If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and make available for delivery in exchange therefor a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and 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 reasonably required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a protected purchaser, the Company shall execute and upon its request the Trustee shall authenticate and make available for delivery, in lieu of any such destroyed, lost or stolen Security, a new Security of the same Series and of like tenor and principal amount and bearing a number not contemporaneously outstanding.
In case 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.
Upon the issuance of any new Security under this Section, 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.
Every new Security of any Series issued pursuant to this Section 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
11
enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that Series duly issued hereunder.
The provisions of this Section 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 2.9
Outstanding Securities
.
The Securities outstanding at any time are all the Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest on a Global Security effected by the Trustee in accordance with the provisions hereof and those described in this Section as not outstanding.
If a Security is replaced pursuant to Section 2.8, it ceases to be outstanding until the Trustee receives proof satisfactory to it that the replaced Security is held by a protected purchaser.
If the Paying Agent holds on the Maturity of Securities of a Series money sufficient to pay such Securities payable on that date, then on and after that date such Securities of the Series cease to be outstanding and interest on them ceases to accrue.
A Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.
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, the principal amount of a Discount Security that shall be deemed to be outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to Section 6.2.
Section 2.10
Treasury Securities
.
In determining whether the Holders of the required principal amount of Securities of a Series have concurred in any request, demand, authorization, direction, notice, consent or waiver, Securities of a Series owned by the Company shall be disregarded, except that for the purposes of determining whether the Trustee shall be protected in relying on any such request, demand, authorization, direction, notice, consent or waiver, only Securities of a Series that the Trustee knows are so owned shall be so disregarded.
Section 2.11
Temporary Securities
.
Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities upon a Company Order. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and the Trustee upon request shall authenticate definitive Securities of
12
the same Series and date of Maturity in exchange for temporary Securities. Until so exchanged, temporary securities shall have the same rights under this Indenture as the definitive Securities.
Section 2.12
Cancellation
.
The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee shall cancel all Securities surrendered for transfer, exchange, payment, replacement or cancellation and deliver such canceled Securities to the Company, unless the Company otherwise directs; provided that the Trustee shall not be required to destroy Securities. The Company may not issue new Securities to replace Securities that it has paid or delivered to the Trustee for cancellation.
Section 2.13
Defaulted Interest
.
If the Company defaults in a payment of interest on a Series of Securities, it shall pay the defaulted interest, plus, to the extent permitted by law, any interest payable on the defaulted interest, to the persons who are Securityholders of the Series on a subsequent special record date. The Company shall fix the record date and payment date. At least 10 days before the record date, the Company shall mail to the Trustee and to each Securityholder of the Series a notice that states the record date, the payment date and the amount of interest to be paid. The Company may pay defaulted interest in any other lawful manner.
Section 2.14
Global Securities
.
2.14.1. Terms Of Securities. A Board Resolution, a supplemental indenture hereto or an Officers’ Certificate shall establish whether the Securities of a Series shall be issued in whole or in part in the form of one or more Global Securities and the Depository for such Global Security or Securities.
2.14.2. Transfer And Exchange. Notwithstanding any provisions to the contrary contained in Section 2.7 and in addition thereto, any Global Security shall be exchangeable pursuant to Section 2.7 for Securities registered in the names of Holders other than the Depository for such Security or its nominee only if (i) such Depository notifies the Company that it is unwilling or unable to continue as Depository for such Global Security or if at any time such Depository ceases to be a clearing agency registered under the Exchange Act, and, in either case, the Company fails to appoint a successor Depository registered as a clearing agency under the Exchange Act within 90 days of such event, (ii) the Company executes and delivers to the Trustee an Officers’ Certificate to the effect that such Global Security shall be so exchangeable or (iii) an Event of Default with respect to the Securities represented by such Global Security shall have happened and be continuing. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Securities of the same Series registered in such names as the Depository shall direct in writing in an aggregate principal amount equal to the principal amount of the Global Security with like tenor and terms.
Except as provided in this Section 2.14.2, a Global Security may not be transferred except as a whole by the Depository with respect to such Global Security to a nominee of such Depository, by a nominee of such Depository to such Depository or another nominee of such
13
Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.
2.14.3. Legend. Any Global Security issued hereunder shall bear a legend in substantially the following form:
“This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of the Depository or a nominee of the Depository. This Security is exchangeable for Securities registered in the name of a person other than the Depository or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.”
2.14.4. Acts Of Holders. The Depository, as a Holder, may appoint agents and otherwise authorize participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a Holder is entitled to give or take under the Indenture.
2.14.5. Payments. Notwithstanding the other provisions of this Indenture, unless otherwise specified as contemplated by Section 2.2, payment of the principal of and interest, if any, on any Global Security shall be made to the Holder thereof.
2.14.6. Consents, Declaration And Directions. Except as provided in Section 2.14.5, the Company, the Trustee and any Agent shall treat a person as the Holder of such principal amount of outstanding Securities of such Series represented by a Global Security as shall be specified in a written statement of the Depository with respect to such Global Security, for purposes of obtaining any consents, declarations, waivers or directions required to be given by the Holders pursuant to this Indenture.
Section 2.15
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 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 Securities or as contained in any notice of a redemption and that reliance may be placed only on the other elements of identification printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee in writing of any change in the “CUSIP” numbers.
14
ARTICLE III
REDEMPTION
Section 3.1
Notice To Trustee
.
The Company may, with respect to any Series of Securities, reserve the right to redeem and pay the Series of Securities or may covenant to redeem and pay the Series of Securities or any part thereof prior to the Stated Maturity thereof at such time and on such terms as provided for in such Securities. If a Series of Securities is redeemable and the Company wants or is obligated to redeem prior to the Stated Maturity thereof all or part of the Series of Securities pursuant to the terms of such Securities, it shall notify the Trustee of the redemption date and the principal amount of Series of Securities to be redeemed. The Company shall give the notice at least 45 days before the redemption date (or such shorter notice as may be acceptable to the Trustee).
Section 3.2
Selection of Securities to be Redeemed
.
Unless otherwise indicated for a particular Series by a Board Resolution, a supplemental indenture or an Officers’ Certificate, if less than all the Securities of a Series are to be redeemed, the Trustee shall select the Securities of the Series to be redeemed in any manner that the Trustee deems fair and appropriate. The Trustee shall make the selection from Securities of the Series outstanding not previously called for redemption. The Trustee may select for redemption portions of the principal of Securities of the Series that have denominations larger than $2,000. Securities of the Series and portions of them it selects shall be in amounts of $2,000 or whole multiples of $1,000 in excess thereof or, with respect to Securities of any Series issuable in other denominations pursuant to Section 2.2.10, the minimum principal denomination for each Series and integral multiples thereof. Provisions of this Indenture that apply to Securities of a Series called for redemption also apply to portions of Securities of that Series called for redemption.
Section 3.3
Notice of Redemption
.
Unless otherwise indicated for a particular Series by Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, at least 30 days but not more than 60 days before a redemption date, the Company shall mail a notice of redemption by first-class mail or send electronically in accordance with the applicable procedures of the Depository in the case of Global Securities, to each Holder whose Securities are to be redeemed and, if any Bearer Securities are outstanding, publish on one occasion a notice in an Authorized Newspaper.
The notice shall identify the Securities of the Series to be redeemed and shall state:
(a)
the redemption date;
(b)
the redemption price;
(c)
the name and address of the Paying Agent;
15
(d)
that Securities of the Series called for redemption must be surrendered to the Paying Agent to collect the redemption price;
(e)
that interest on Securities of the Series called for redemption ceases to accrue on and after the redemption date;
(f)
the CUSIP number, if any; and
(g)
any other information as may be required by the terms of the particular Series or the Securities of a Series being redeemed.
At the Company’s written request delivered at least 45 days prior to the redemption date (unless the Trustee shall agree to a shorter period), the Trustee shall give the notice of redemption in the Company’s name and at its expense.
Section 3.4
Effect of Notice of Redemption
.
Once notice of redemption is mailed or published as provided in Section 3.3, Securities of a Series called for redemption become due and payable on the redemption date and at the redemption price. Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price including accrued interest to the redemption date, provided that installments of interest whose Stated Maturity is on or prior to the redemption date shall be payable to the Holders of such Securities (or one or more predecessor Securities) registered at the close of business on the relevant record date therefor according to their terms and the terms of this Indenture.
Section 3.5
Deposit of Redemption Price
.
On or before the redemption date, the Company shall deposit with the Paying Agent money sufficient to pay the redemption price of all Securities to be redeemed on that date.
Section 3.6
Securities Redeemed in Part
.
Upon surrender of a Security that is redeemed in part, the Trustee shall authenticate for the Holder a new Security of the same Series and the same Maturity equal in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
Section 4.1
Payment of Principal and Interest
.
The Company covenants and agrees for the benefit of the Holders of each Series of Securities that it will duly and punctually pay the principal of and interest, if any, on the Securities of that Series in accordance with the terms of such Securities and this Indenture.
16
Section 4.2
Commission Reports
.
The Company shall deliver to the Trustee within 15 days after it files them with the Commission copies of the annual reports and of the information, documents, and other reports (or copies of such portions of any of the foregoing as the Commission may by rules and regulations prescribe) which the Company is required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act. The Company also shall comply with the other provisions of Trust Indenture Act Section 314(a). Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on an Officers’ Certificate).
Section 4.3
Compliance Certificate
.
The Company shall deliver to the Trustee, within 120 days after the end of each fiscal year of the Company, an Officers’ Certificate stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his/her knowledge the Company has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions hereof (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he may have knowledge).
The Company will, so long as any of the Securities are outstanding, deliver to the Trustee, forthwith upon becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto.
Section 4.4
Stay, Extension and Usury Laws
.
The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture or the Securities and the Company (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not, by resort to any such law, 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 has been enacted.
Section 4.5
Corporate Existence
.
Subject to Article V, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the rights (charter and statutory), licenses and franchises of the Company, except as provided in Section 5.1; provided,
17
however, that the Company shall not be required to preserve any such right, license or franchise if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Subsidiaries taken as a whole and that the loss thereof is not adverse in any material respect to the Holders.
Section 4.6
Taxes
.
The Company shall pay prior to delinquency all taxes, assessments and governmental levies, except as contested in good faith and by appropriate proceedings.
ARTICLE V
SUCCESSORS
Section 5.1
When Company May Merge, Etc
.
The Company shall not consolidate with or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its properties and assets to, any person (a “successor person”) unless:
(a)
the Company is the surviving corporation or the successor person (if other than the Company) is a corporation organized and validly existing under the laws of any U.S. domestic jurisdiction and expressly assumes the Company’s obligations on the Securities and under this Indenture; and
(b)
immediately after giving effect to the transaction, no Default or Event of Default shall have occurred and be continuing.
The Company shall deliver to the Trustee prior to the consummation of the proposed transaction an Officers’ Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and the related supplemental indenture comply with this Indenture and such supplemental indenture is enforceable against such successor person.
Section 5.2
Successor Corporation Substituted
.
Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company in accordance with Section 5.1, the successor corporation formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition 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 has been named as the Company herein; provided, however, that the predecessor Company in the case of a sale, conveyance or other disposition (other than a lease) shall be released from all obligations and covenants under this Indenture and the Securities.
18
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.1
Events of Default
.
“
Event of Default
,” wherever used herein with respect to Securities of any Series, means any one of the following events, unless in the establishing Board Resolution, supplemental indenture or Officers’ Certificate, it is provided that such Series shall not have the benefit of said Event of Default:
(a)
default in the payment of any interest on any Security of that Series when it becomes due and payable, and continuance of such default for a period of 30 days (unless the entire amount of such payment is deposited by the Company with the Trustee or with a Paying Agent prior to the expiration of such period of 30 days); or
(b)
default in the payment of principal of or premium, if any, on any Security of that Series, when due and payable; or
(c)
default in the deposit of any sinking fund payment, when and as due in respect of any Security of that Series; or
(d)
default in the performance or breach of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty for which the consequences of nonperformance or breach are addressed elsewhere in this Section 6.1 and other than a covenant or warranty that has been included in this Indenture solely for the benefit of Series of Securities other than that Series), which default continues uncured for a period of 60 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 not less than a majority in principal amount of the outstanding Securities of that Series 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 Company pursuant to or within the meaning of any Bankruptcy Law:
(i)
commences a voluntary case,
(ii)
consents to the entry of an order for relief against it in an involuntary case,
(iii)
consents to the appointment of a Custodian of it or for all or substantially all of its property,
(iv)
makes a general assignment for the benefit of its creditors, or
(v)
generally is unable to pay its debts as the same become due; or
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(f)
a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i)
is for relief against the Company in an involuntary case,
(ii)
appoints a Custodian of the Company or for all or substantially all of its property,
(iii)
orders the winding up or liquidation of the Company,
(iv)
adjudges the Company as bankrupt or insolvent, or
(v)
approves as properly filed a petition seeking reorganization, arrangement, adjustment or compensation of or in respect of the Company under any Bankruptcy Law,
and the order or decree remains unstayed and in effect for 60 days; or
(g)
any other Event of Default provided with respect to Securities of that Series, which is specified in a Board Resolution, a supplemental indenture hereto or an Officers’ Certificate, in accordance with Section 2.2.14.
The term “
Bankruptcy Law
” means title 11, U.S. Code or any similar Federal or State law for the relief of debtors. The term “
Custodian
” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
Section 6.2
Acceleration of Maturity
.
If an Event of Default specified in Section 6.1(e) or (f) shall occur with respect to Securities of any Series at the time outstanding, the principal amount (or specified amount) of and accrued and unpaid interest, if any, on all outstanding Securities of such Series shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.
Section 6.3
Collection Of Indebtedness And Suits For Enforcement By Trustee
.
The Company covenants that if:
(a)
default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or
(b)
default is made in the payment of principal of any Security at the Maturity thereof, or
(c)
default is made in the deposit of any sinking fund payment when and as due by the terms of a Security,
then the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and interest and, to the extent that payment of such interest shall be legally enforceable, interest on
20
any overdue principal and any overdue interest at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
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, 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 deemed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.
If an Event of Default with respect to any Securities of any Series 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 of such Series 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 6.4
Trustee May File Proofs Of Claim
.
In case of the pendency of any insolvency, bankruptcy, liquidation, dissolution, winding up, or similar proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise, (a) to file and prove a claim for the whole amount of principal and interest owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and (b) 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 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 due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
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Section 6.5
Trustee May Enforce Claims 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, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.
Section 6.6
Application of Money Collected
.
Any money collected by the Trustee pursuant to this Article 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 on account of principal or interest, upon presentation of the 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 under this Indenture;
Second: To the payment of the amounts then due and unpaid for principal of and interest on the Securities 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 such Securities for principal and interest, respectively; and
Third: To the Company.
Section 6.7
Limitation On Suits
.
No Holder of any Security of any Series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, 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 of that Series;
(b)
the Holders of at least a majority in principal amount of the outstanding Securities of that Series 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 indemnity reasonably satisfactory to the Trustee against any loss, liability or expense;
(d)
the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and
(e)
no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the
22
outstanding Securities of that Series; 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 of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, 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.
Section 6.8
Unconditional Right of Holders to Receive Principal and Interest
.
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 premium, if any, and interest, if any, on such Security on the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.
Section 6.9
Restoration of Rights and Remedies
.
If the Trustee or any Holder 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 or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.
Section 6.10
Rights and Remedies Cumulative
.
Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in Section 2.8, no right or remedy herein conferred upon or reserved to the Trustee or to 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, to the extent permitted by law, prevent the concurrent assertion or employment of any other appropriate right or remedy.
Section 6.11
Delay or Omission Not Waiver
.
No delay or omission of the Trustee or of any Holder of any Securities 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 or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.
23
Section 6.12
Control by Holders
.
The Holders of a majority in principal amount of the outstanding Securities of any Series 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, with respect to the Securities of such Series, 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 which is not inconsistent with such direction, and
(c)
subject to the provisions of Section 6.1, the Trustee shall have the right to decline to follow any such direction if the Trustee in good faith shall, by a Responsible Officer of the Trustee, determine that the proceeding so directed would involve the Trustee in personal liability.
Section 6.13
Waiver Of Past Defaults
.
The Holders of not less than a majority in principal amount of the outstanding Securities of any Series may on behalf of the Holders of all the Securities of such Series waive any past Default hereunder with respect to such Series and its consequences, except a Default (i) in the payment of the principal of or premium, if any, or interest on any Security of such Series or (ii) in respect of a covenant or provision hereof which cannot be modified or amended without the consent of the Holder of each outstanding Security of such Series affected. Upon any such waiver, such 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 Default or impair any right consequent thereon.
Section 6.14
Undertaking For Costs
.
All parties to this Indenture agree, and each Holder of any Security by his 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, suffered or omitted by it as Trustee, the filing by any party litigant in 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, 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 shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the outstanding Securities of any Series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of or premium, if any, or interest on any Security on or after the Stated Maturity or Stated Maturities expressed in such Security (or, in the case of redemption, on the redemption date).
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ARTICLE VII
TRUSTEE
Section 7.1
Duties of Trustee
.
(a)
If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.
(b)
Except during the continuance of an Event of Default:
(i)
The Trustee need perform only those duties that are specifically set forth in this Indenture and no others.
(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 Officers’ Certificates or Opinions of Counsel furnished to the Trustee and conforming to the requirements of this Indenture; however, in the case of any such Officers’ Certificates or Opinions of Counsel which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such Officers’ Certificates and Opinions of Counsel to determine whether or not they conform to the requirements of this Indenture.
(c)
The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:
(i)
This paragraph does not limit the effect of paragraph (b) of this Section.
(ii)
The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts.
(iii)
The Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it with respect to Securities of any Series in good faith in accordance with the direction of the Holders of a majority in principal amount of the outstanding Securities of such Series relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such Series.
(d)
Every provision of this Indenture that in any way relates to the Trustee is subject to paragraph (a), (b) and (c) of this Section.
25
(e)
The Trustee may refuse to perform any duty or exercise any right or power at the request or direction of any Holder unless it receives indemnity satisfactory to it against any loss, liability or expense.
(f)
The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
(g)
No provision of this Indenture shall require the Trustee to risk its own funds or otherwise incur any financial liability in the performance of any of its duties, 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 is not reasonably assured to it.
(h)
The Paying Agent, the Registrar and any authenticating agent shall be entitled to the protections, immunities and standard of care as are set forth in paragraphs (a), (b) and (c) of this Section with respect to the Trustee.
Section 7.2
Rights of Trustee
.
(a)
The Trustee may rely on and shall be protected in acting or refraining from acting upon any document believed in good faith by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document.
(b)
Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate.
(c)
The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. No Depository shall be deemed an agent of the Trustee and the Trustee shall not be responsible for any act or omission by any Depository.
(d)
The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers, provided that the Trustee’s conduct does not constitute negligence or bad faith.
(e)
The Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder without negligence and in good faith and in reliance thereon.
(f)
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 of Securities unless such Holders shall have offered to the Trustee security or
26
indemnity satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.
(g)
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, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit.
(h)
The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities generally or the Securities of a particular Series and this Indenture.
(i)
In no event shall the Trustee be liable for any special, indirect, 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.
(j)
The Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including without limitation: acts of God; earthquakes; fires; floods; wars; civil or military disturbances; sabotage; epidemics; riots; interruptions, loss or malfunctions of utilities, computer (hardware or software) or communications service; accidents; labor disputes; acts of civil or military authority; or governmental actions (it being understood that the Trustee shall use commercially reasonable efforts to resume performance as soon as practicable under the circumstances).
Section 7.3
Individual Rights of Trustee
.
The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate of the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. The Trustee is also subject to Sections 7.10 and 7.11.
Section 7.4
Trustee’s Disclaimer
.
The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement in the Securities other than its authentication.
27
Section 7.5
Notice Of Defaults
.
If a Default or Event of Default occurs and is continuing with respect to the Securities of any Series and if it is known to a Responsible Officer of the Trustee, the Trustee shall send to each Securityholder of the Securities of that Series and, if any Bearer Securities are outstanding, publish on one occasion in an Authorized Newspaper, notice of a Default or Event of Default within 90 days after it occurs or, if later, after a Responsible Officer of the Trustee has knowledge of such Default or Event of Default. Except in the case of a Default or Event of Default in payment of principal of or premium, if any, or interest on any Security of any Series, the Trustee may withhold the notice if and so long as its corporate trust committee or a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Securityholders of that Series.
Section 7.6
Reports by Trustee to Holders
.
Within 60 days after May 15 in each year, the Trustee shall transmit by mail or send electronically in accordance with the applicable procedures of the Depository in the case of Global Securities to all Securityholders, as their names and addresses appear on the register kept by the Registrar and, if any Bearer Securities are outstanding, publish in an Authorized Newspaper, a brief report dated as of such May 15, in accordance with, and to the extent required under, Trust Indenture Act Section 313.
A copy of each report at the time of its mailing to Securityholders of any Series shall be filed with the Commission and each stock exchange on which the Securities of that Series are listed. The Company shall promptly notify the Trustee when Securities of any Series are listed on any stock exchange.
Section 7.7
Compensation and Indemnity
.
The Company shall pay to the Trustee from time to time compensation for its services as the Company and the Trustee shall from time to time agree upon in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred by it. Such expenses shall include the reasonable compensation and expenses of the Trustee’s agents and counsel.
The Company shall indemnify each of the Trustee and any predecessor Trustee (including the cost of defending itself) against any loss, liability or expense, including taxes (other than taxes based upon, measured by or determined by the income of the Trustee) incurred by it except as set forth in the next paragraph in the performance of its duties under this Indenture as Trustee or Agent. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have one separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. This indemnification shall apply to officers, directors, employees, shareholders and agents of the Trustee.
28
The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee or by any officer, director, employee, shareholder or agent of the Trustee through negligence or bad faith.
To secure the Company’s payment obligations in this Section, the Trustee shall have a lien prior to the Securities of any Series on all money or property held or collected by the Trustee, except that held in trust to pay principal of or premium, if any, or interest on particular Securities of that Series.
When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.1(e) or (f) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.
The provisions of this Section shall survive the termination of this Indenture.
Section 7.8
Replacement of Trustee
.
A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section.
The Trustee may resign with respect to the Securities of one or more Series by so notifying the Company at least 30 days prior to the date of the proposed resignation. The Holders of a majority in principal amount of the Securities of any Series may remove the Trustee with respect to that Series by so notifying the Trustee and the Company. The Company may remove the Trustee with respect to Securities of one or more Series if:
(a)
the Trustee fails to comply with Section 7.10;
(b)
the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c)
a Custodian or public officer takes charge of the Trustee or its property; or
(d)
the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Securities may appoint a successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee with respect to the Securities of any one or more Series does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least a majority in principal amount of the Securities of the applicable Series may petition any court of competent jurisdiction for the appointment of a successor Trustee.
29
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee subject to the lien provided for in Section 7.7, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee with respect to each Series of Securities for which it is acting as Trustee under this Indenture. A successor Trustee shall mail or send electronically in accordance with the applicable procedures of the Depository in the case of Global Securities a notice of its succession to each Securityholder of each such Series and, if any Bearer Securities are outstanding, publish such notice on one occasion in an Authorized Newspaper. Notwithstanding replacement of the Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7 hereof shall continue for the benefit of the retiring Trustee with respect to expenses and liabilities incurred by it prior to such replacement.
Section 7.9
Successor Trustee by Merger, Etc
.
If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee.
Section 7.10
Eligibility; Disqualification
.
This Indenture shall always have a Trustee who satisfies the requirements of Trust Indenture Act Section 310(a)(1), (2) and (5). The Trustee shall always have a combined capital and surplus of at least $25,000,000 as set forth in its most recent published annual report of condition. The Trustee shall comply with Trust Indenture Act Section 310(b).
Section 7.11
Referential Collection of Claims Against Company
.
The Trustee is subject to Trust Indenture Act Section 311(a), excluding any creditor relationship listed in Trust Indenture Act Section 311(b). A Trustee who has resigned or been removed shall be subject to Trust Indenture Act Section 311(a) to the extent indicated.
ARTICLE VIII
SATISFACTION AND DISCHARGE; DEFEASANCE
Section 8.1
Satisfaction and Discharge of Indenture
.
This Indenture shall upon Company Order cease to be of further effect (except as hereinafter provided in this Section 8.1), and the Trustee, at the expense of the Company, shall execute instruments reasonably requested by the Company acknowledging satisfaction and discharge of this Indenture, when
(a)
either:
(i)
all Securities theretofore authenticated and delivered (other than Securities that have been destroyed, lost or stolen and that have been replaced or paid) have been delivered to the Trustee for cancellation; or
30
(ii)
all such Securities not theretofore delivered to the Trustee for cancellation (1) have become due and payable, or (2) will become due and payable at their Stated Maturity within one year, or (3) 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; and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust cash in Dollars and/or U.S. Government Obligations in an amount sufficient in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification delivered to the Trustee for the purpose of paying and discharging the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal, premium, if any, and interest to the date of such deposit (in the case of Securities which have become due and payable on or prior to the date of such deposit) or to the Stated 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 7.7, and, if money shall have been deposited with the Trustee pursuant to clause (a) of this Section, the provisions of Sections 2.4, 2.7, 2.8, 8.1, 8.2 and 8.4 shall survive.
Section 8.2
Application of Trust Funds; Indemnification
.
Subject to the provisions of Section 8.4, all money and U.S. Government Obligations deposited with the Trustee pursuant to Section 8.1 and all money received by the Trustee in respect of U.S. Government Obligations deposited with the Trustee pursuant to Section 8.1 shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (other than the Company acting as its own Paying Agent) as the Trustee may determine, to the persons entitled thereto, of the principal, premium, if any, and interest for whose payment such money and property has been deposited with or received by the Trustee.
Section 8.3
[Reserved]
Section 8.4
Repayment to Company
.
The Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the payment of principal, premium, if any, and interest that remains unclaimed for two years. After that, Securityholders entitled to the money must look to the Company for
31
payment as general creditors unless an applicable abandoned property law designates another person.
Section 8.5
Effect on Subordination Provisions.
Unless otherwise expressly provided pursuant to Section 2.2 with respect to the Securities of any Series, the provisions for subordination of the Securities set forth in Article XII hereof are hereby expressly made subject to the provisions for satisfaction and discharge set forth in Section 8.1 hereof and, anything herein to the contrary notwithstanding, upon the effectiveness of such satisfaction and discharge pursuant to Section 8.1 hereof, such Securities shall thereupon cease to be so subordinated and shall no longer be subject to the provisions of Article XII hereof and, without limitation to the foregoing, all moneys, U.S. Government Obligations and other securities or property deposited with the Trustee (or other qualifying trustee) in trust in connection with such satisfaction and discharge shall be applied to pay the principal of and premium, if any, and interest, if any, on the Securities of such Series as and when the same shall become due and payable notwithstanding the provisions of Article XII.
ARTICLE IX
AMENDMENTS AND WAIVERS
Section 9.1
Without Consent of Holders
.
The Company and the Trustee may amend or supplement this Indenture or the Securities of one or more Series without the consent of any Securityholder:
(a)
to cure any ambiguity, defect or inconsistency;
(b)
to comply with Article V;
(c)
to provide for uncertificated Securities in addition to or in place of certificated Securities;
(d)
to make any change that does not adversely affect the rights of any Securityholder;
(e)
to provide for the issuance of and establish the form and terms and conditions of Securities of any Series as permitted by this Indenture;
(f)
to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more Series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee;
(g)
to comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act; or
32
(h)
to conform this Indenture or the terms of the Securities to any terms set forth in the prospectus for any Securities.
Section 9.2
With Consent of Holders
.
The Company and the Trustee may enter into a supplemental indenture with the written consent of the Holders of at least a majority in principal amount of the outstanding Securities of each Series affected by such supplemental indenture (including consents obtained in connection with a tender offer or exchange offer for the Securities of such Series), for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the Securityholders of each such Series. Except as provided in Section 6.13, the Holders of at least a majority in principal amount of the outstanding Securities of any Series by notice to the Trustee (including consents obtained in connection with a tender offer or exchange offer for the Securities of such Series) may waive compliance by the Company with any provision of this Indenture or the Securities with respect to such Series.
It shall not be necessary for the consent of the Holders of Securities under this Section 9.2 to approve the particular form of any proposed supplemental indenture or waiver, but it shall be sufficient if such consent approves the substance thereof. After a supplemental indenture or waiver under this section becomes effective, the Company shall mail or send electronically in accordance with the applicable procedures of the Depository in the case of Global Securities to the Holders of Securities affected thereby and, if any Bearer Securities affected thereby are outstanding, publish on one occasion in an Authorized Newspaper, a notice briefly describing the supplemental indenture or waiver. Any failure by the Company to mail or publish such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture or waiver.
Section 9.3
Limitations
.
Without the consent of each Securityholder affected, an amendment or waiver may not:
(a)
reduce the amount of Securities whose Holders must consent to an amendment, supplement or waiver;
(b)
reduce the rate of (or change the calculation of the rate) or extend the time for payment of interest (including default interest) on any Security;
(c)
change any of the redemption or repurchase terms and conditions applicable to any Security;
(d)
reduce the principal or change the Stated Maturity of any Security;
(e)
reduce the amount of, or postpone the date fixed for, the payment of any sinking fund or analogous obligation;
33
(f)
reduce the principal amount of Discount Securities payable upon acceleration of the Maturity thereof;
(g)
waive a Default or Event of Default in the payment of the principal of or premium, if any, or interest, if any, on any Security;
(h)
make the principal of or interest, if any, on any Security payable in any currency other than that stated in the Security; or
(i)
make any change in Sections 6.8 or 6.13 or this Section 9.3.
Section 9.4
Compliance With Trust Indenture Act
.
Every amendment to this Indenture or the Securities of one or more Series shall be set forth in a supplemental indenture hereto that complies with the Trust Indenture Act as then in effect.
Section 9.5
Revocation and Effect of Consents
.
Until an amendment is set forth in a supplemental indenture or a waiver becomes effective, a consent to it by a Holder of a Security is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of a Security if the Trustee receives the notice of revocation before the date of the supplemental indenture or the date the waiver becomes effective.
Any amendment or waiver once effective shall bind every Securityholder of each Series affected by such amendment or waiver unless it is of the type described in Section 9.3. In that case, the amendment or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.
Section 9.6
Notation on or Exchange of Securities
.
The Trustee may place an appropriate notation about an amendment or waiver on any Security of any Series thereafter authenticated. The Company in exchange for Securities of that Series may issue and the Trustee shall authenticate upon request new Securities of that Series that reflect the amendment or waiver.
Section 9.7
Trustee Protected
.
In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to Section 7.1) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee shall sign all supplemental indentures, except that the Trustee need not sign any supplemental indenture that adversely affects its rights.
34
ARTICLE X
MISCELLANEOUS
Section 10.1
Trust Indenture Act Controls
.
If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this Indenture by the Trust Indenture Act, such required or deemed provision shall control.
Section 10.2
Notices
.
Any notice or communication by the Company or the Trustee to the other, or by a Holder to the Company or the Trustee, is duly given if in writing and delivered in person or mailed by first-class mail:
if to the Company:
CoBiz Financial Inc.
821 Seventeenth Street
Denver, Colorado 80202
Attention: Lyne Andrich
Telephone: (303) 293-2265
Facsimile: (303) 244-9700
if to the Trustee:
U.S. Bank National Association
Corporate Trust Services
One Federal Street, 3
rd
Floor
Boston, Massachusetts 02110
Attention: S. Gomes (CoBiz
Notes)
Telephone: (617) 603-6549
Facsimile: (866) 676-6882
The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.
Any notice or communication to a Securityholder shall be mailed by first-class mail to his address shown on the register kept by the Registrar or sent electronically in accordance with the applicable procedures of the Depository in the case of Global Securities and, if any Bearer Securities are outstanding, published in an Authorized Newspaper. Failure to send a notice or communication to a Securityholder of any Series or any defect in it shall not affect its sufficiency with respect to other Securityholders of that or any other Series.
If a notice or communication is sent or published in the manner provided above, within the time prescribed, it is duly given, whether or not the Securityholder receives it.
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If the Company sends a notice or communication to Securityholders, it shall mail a copy to the Trustee and each Agent at the same time.
Section 10.3
Communication by Holders with Other Holders
.
Securityholders of any Series may communicate pursuant to Trust Indenture Act Section 312(b) with other Securityholders of that Series or any other Series with respect to their rights under this Indenture or the Securities of that Series or all Series. The Company, the Trustee, the Registrar and anyone else shall have the protection of Trust Indenture Act Section 312(c).
Section 10.4
Certificate and Opinion as to Conditions Precedent
. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with.
Section 10.5
Statements Required in Certificate or Opinion
.
Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to Trust Indenture Act Section 314(a)(4)) shall comply with the provisions of Trust Indenture Act Section 314(e) and shall include:
(a)
a statement that the person making such certificate or opinion has read such covenant or condition;
(b)
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(c)
a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him 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 or not, in the opinion of such person, such condition or covenant has been complied with.
Section 10.6
Rules by Trustee and Agents
.
The Trustee may make reasonable rules for action by or a meeting of Securityholders of one or more Series. Any Agent may make reasonable rules and set reasonable requirements for its functions.
Section 10.7
Legal Holidays
.
Unless otherwise provided by Board Resolution, Officers’ Certificate or supplemental indenture hereto for a particular Series, a “
Legal Holiday
” is any day that is not a Business Day.
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Section 10.8
No Recourse Against Others
.
A director, officer, employee or shareholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities.
Section 10.9
Counterparts
.
This Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.
Section 10.10
Governing Laws
.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 10.11
No Adverse Interpretation of Other Agreements
.
This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary of the Company. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
Section 10.12
Successors
.
All agreements of the Company in this Indenture and the Securities shall bind its permitted successor. All agreements of the Trustee in this Indenture shall bind its permitted successor.
Section 10.13
Severability
.
In case 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.
Section 10.14
Table of Contents, Headings, Etc
.
The Table of Contents, Cross-Reference Table, and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.
Section 10.15
USA Patriot Act
.
The parties hereto acknowledge that in accordance with Section 326 of the USA PATRIOT Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that
37
identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The Parties to this Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirement of the USA PATRIOT Act.
ARTICLE XI
[RESERVED]
ARTICLE XII
SUBORDINATION OF SECURITIES
Section 12.1
Agreement of Subordination
.
The Company covenants and agrees, and each Holder of Securities issued hereunder by his acceptance thereof likewise covenants and agrees, that all Securities shall be issued subject to the provisions of this Article XII; and each Person holding any Security, whether upon original issue or upon transfer, assignment or exchange thereof, accepts and agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and interest on all Securities (including, but not limited to, the redemption price with respect to the Securities called for redemption in accordance with Article III as provided in the Indenture) issued hereunder shall, to the extent and in the manner hereinafter set forth, be subordinated and subject in right of payment to the prior payment in full of all Senior Indebtedness, whether outstanding at the date of this Indenture or thereafter incurred.
No provision of this Article XII shall prevent the occurrence of any Default or Event of Default hereunder.
Section 12.2
Payments to Holders
.
No payment shall be made with respect to the principal of, or premium, if any, or interest on the Securities (including, but not limited to, the redemption price with respect to the Securities to be called for redemption in accordance with Article III as provided in the Indenture), except payments and distributions made by the Trustee as permitted by the first or second paragraph of Section 12.5, if:
(a)
a default (a “payment default”) in the payment of principal, premium, if any, interest, rent or other obligations due on any Senior Indebtedness occurs and is continuing (or, in the case of Senior Indebtedness for which there is a period of grace, in the event of such a default that continues beyond the period of grace, if any, specified in the instrument or lease evidencing such Senior Indebtedness), unless and until such default shall have been cured or waived or shall have ceased to exist; or
38
(b)
a default, other than a payment default (a “non-payment default”), on Senior Indebtedness occurs and is continuing that then permits holders of such Indebtedness to accelerate its maturity and the Trustee receives a notice of the default (a “
Payment Blockage Notice
”) from a Representative or the Company.
No non-payment default that existed or was continuing on the date of delivery of any Payment Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage Notice unless the non-payment default is based upon facts or events arising after the date of delivery of such Payment Blockage Notice.
The Company may and shall resume payments on and distributions in respect of the Securities upon the earlier of:
(1) in the case of a payment default, upon the date which such default is cured or waived or ceases to exist, or
(2) in the case of a non-payment default, the earlier of the date upon which such non-payment default is cured or waived or ceases to exist and 179 days after the date on which the Payment Blockage Notice is received by the Trustee if the maturity of such Senior Indebtedness has not been accelerated.
Upon any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any insolvency, bankruptcy, liquidation, dissolution, winding up or similar proceeding, all amounts due or to become due upon all Senior Indebtedness shall first be paid in full in cash or other payment satisfactory to the holders of such Senior Indebtedness, or payment thereof in accordance with its terms provided for in cash or other payment satisfactory to the holders of such Senior Indebtedness, before any payment is made on account of the principal of, premium, if any, or interest on the Securities (except payments made pursuant to Article VIII from monies deposited with the Trustee pursuant thereto prior to commencement of proceedings for such dissolution, winding-up, liquidation or reorganization); and upon any such insolvency, bankruptcy, liquidation, dissolution, winding up or similar proceeding, any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to which the Holders of the Securities or the Trustee would be entitled, except for the provision of this Article XII, shall (except as aforesaid) be paid by the Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by the Holders of the Securities or by the Trustee under this Indenture if received by them or it after the commencement of such proceedings after default, directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders, or as otherwise required by law or a court order) or their Representative or Representatives as their respective interests may appear, to the extent necessary to pay all Senior Indebtedness in full, in cash or other payment satisfactory to the holders of such Senior Indebtedness, after giving effect to any concurrent payment or distribution to or for the holders of Senior Indebtedness, before any payment or distribution or provision therefor is made to the Holders of the Securities or to the Trustee.
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For purposes of this Article XII, the words, “cash, property or securities” shall not be deemed to include shares of stock of the Company as reorganized or readjusted, or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment, the payment of which is subordinated at least to the extent provided in this Article XII with respect to the Securities to the payment of all Senior Indebtedness which may at the time be outstanding; provided that (i) the Senior Indebtedness is assumed by the new corporation, if any, resulting from any reorganization or readjustment, and (ii) the rights of the holders of Senior Indebtedness (other than leases which are not assumed by the Company or the new corporation, as the case may be) are not, without the consent of such holders, altered by such reorganization or readjustment. The consolidation of the Company with, or the merger of the Company into, another person or the liquidation or dissolution of the Company following the sale, lease, conveyance or other disposition of its property as an entirety, or substantially as an entirety, to another person upon the terms and conditions provided for in Article V, shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section 12.2 if such other corporation shall, as a part of such consolidation, merger, sale, lease, conveyance or other disposition, comply with the conditions stated in Article V.
In the event of the acceleration of the Securities pursuant to this Indenture, no payment or distribution shall be made to the Trustee or any Holder of Securities in respect of the principal of, premium, if any, or interest on the Securities (including, but not limited to, the redemption price with respect to the Securities called for redemption in accordance with Article III as provided in the Indenture), except payments and distributions made by the Trustee as permitted by the first or second paragraph of Section 12.5, until all Senior Indebtedness has been paid in full in cash or other payment satisfactory to the holders of Senior Indebtedness. If payment of the Securities is accelerated pursuant to this Indenture, the Company shall promptly notify holders of Senior Indebtedness of the acceleration at the address set forth in the notice from the Agent (or successor agent) to the Trustee as being the address to which the Trustee should send its notice pursuant to this Section 12.2, unless there are no payment obligations of the Company thereunder and all obligations thereunder to extend credit have been terminated or expired.
In the event that, notwithstanding the foregoing provisions, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities (including, without limitation, by way of setoff or otherwise), prohibited by the foregoing shall be received by the Trustee or the Holders of the Securities before all Senior Indebtedness is paid in full in cash or other payment satisfactory to the holders of such Senior Indebtedness, or provision is made for such payment thereof in accordance with its terms in cash or other payment satisfactory to the holders of such Senior Indebtedness, such payment or distribution shall be held in trust for the benefit of and shall be paid over or delivered to the holders of Senior Indebtedness or their Representative or Representatives as their respective interests may appear, as calculated by the Company, for application to the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay all Senior Indebtedness in full in cash or other payment satisfactory to the holders of such Senior Indebtedness, after giving effect to any concurrent payment or distribution to or for the holders of such Senior Indebtedness.
Nothing in this Section 12.2 shall apply to claims of, or payments to, the Trustee under or pursuant to Section 7.7. This Section 12.2 shall be subject to the further provisions of Section 12.5.
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Section 12.3
Subrogation of Securities
.
Subject to the payment in full of all Senior Indebtedness, the rights of the Holders of the Securities shall be subrogated to the extent of the payments or distributions made to the holders of such Senior Indebtedness pursuant to the provisions of this Article XII (equally and ratably with the holders of all indebtedness of the Company which ranks equally with the Securities and is entitled to like rights of subrogation) to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal, premium, if any, and interest on the Securities shall be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of the Senior Indebtedness 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 payment over pursuant to the provisions of this Article XII to or for the benefit of the holders of Senior Indebtedness by Holders of the Securities or the Trustee, shall, as between the Company, its creditors other than holders of Senior Indebtedness, and the Holders of the Securities, be deemed to be a payment by the Company to or on account of the Senior Indebtedness; and no payments or distributions of cash, property or securities to or for the benefit of the Holders of the Securities pursuant to the subrogation provisions of this Article XII which would otherwise have been paid to the holders of Senior Indebtedness shall be deemed to be a payment by the Company to or for the account of the Securities. It is understood that the provisions of this Article XII are and are intended solely for the purposes of defining the relative rights of the Holders of the Securities, on the one hand, and the holders of the Senior Indebtedness, on the other hand.
Nothing contained in this Article XII or elsewhere in this Indenture or in the Securities is intended to or shall impair, as among the Company, its creditors other than the holders of Senior Indebtedness, and the Holders of the Securities, the obligation of the Company, which is absolute and unconditional, to pay to the Holders of the Securities the principal of (and premium, if any) and interest on the Securities as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the Holders of the Securities and creditors of the Company other than the holders of the Senior Indebtedness, nor shall anything herein or therein prevent the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article XII of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in this Article XII, the Trustee, subject to the provisions of Section 7.1, and the Holders of the Securities shall be entitled to rely upon any order or decree made by any court of competent jurisdiction in which such bankruptcy, dissolution, winding-up, liquidation or reorganization proceedings are pending, or a certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution, delivered to the Trustee or to the Holders of the Securities, for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon and all other facts pertinent thereto or to this Article XII.
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Section 12.4
Authorization to Effect Subordination
.
Each Holder of a Security by the Holder’s acceptance thereof authorizes and directs the Trustee on the Holder’s behalf to take such action as may be necessary or appropriate to effectuate the subordination as provided in this Article XII and appoints the Trustee to act as the Holder’s attorney-in-fact for any and all such purposes. If the Trustee does not file a proper proof of claim or proof of debt in the form required in any proceeding referred to in Section 6.3 hereof at least 30 days before the expiration of the time to file such claim, the holders of any Senior Indebtedness or their Representatives are hereby authorized to file an appropriate claim for and on behalf of the Holders of the Securities.
Section 12.5
Notice to Trustee
.
The Company shall give prompt written notice in the form of an Officers’ Certificate to a the Trustee and to any Paying Agent of any fact known to the Company which would prohibit the making of any payment of monies to or by the Trustee or any Paying Agent in respect of the Securities pursuant to the provisions of this Article XII. 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 which would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities pursuant to the provisions of this Article XII, unless and until the Trustee shall have received written notice thereof at the Corporate Trust Office from the Company (in the form of an Officers’ Certificate) or a Representative or a holder or holders of Senior Indebtedness or from any trustee thereof; and before the receipt of any such written notice, the Trustee, subject to the provisions of Section 7.1, shall be entitled in all respects to assume that no such facts exist; provided that if on a date not fewer than two Business Days prior to the date upon which by the terms hereof any such monies may become payable for any purpose (including, without limitation, the payment of the principal of, or premium, if any, or interest on any Security) the Trustee shall not have received, with respect to such monies, the notice provided for in this Section 12.5, 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 which may be received by it on or after such prior date.
Notwithstanding anything in this Article XII to the contrary, nothing shall prevent any payment by the Trustee to the Holders of monies deposited with it pursuant to Section 8.1, and any such payment shall not be subject to the provisions of Section 12.1 or 12.2.
The Trustee, subject to the provisions of Section 7.1, shall be entitled to rely on the delivery to it of a written notice by a Representative or a person representing himself to be a holder of Senior Indebtedness (or a trustee on behalf of such holder) to establish that such notice has been given by a Representative or a holder of Senior Indebtedness or a trustee on behalf of any such holder or holders. 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 Indebtedness to participate in any payment or distribution pursuant to this Article XII, the Trustee may request such person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness 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
42
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 12.6
Trustee’s Relation to Senior Indebtedness
.
The Trustee in its individual capacity shall be entitled to all the rights set forth in this Article XII in respect of any Senior Indebtedness at any time held by it, to the same extent as any other holder of Senior Indebtedness, and nothing in Section 7.11 or elsewhere in this Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article XII, and no implied covenants or obligations with respect to the holders of Senior Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and, subject to the provisions of Section 7.1, the Trustee shall not be liable to any holder of Senior Indebtedness if it shall pay over or deliver to Holders of Securities, the Company or any other person money or assets to which any holder of Senior Indebtedness shall be entitled by virtue of this Article XII or otherwise.
Section 12.7
No Impairment of Subordination
.
No right of any present or future holder of any Senior Indebtedness 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 which any such holder may have or otherwise be charged with.
Section 12.8
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 shall (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 in addition to or in place of the Trustee; provided, however, that the first paragraph of Section 12.5 shall not apply to the Company or any Affiliate of the Company if it or such Affiliate acts as Paying Agent.
Section 12.9
Senior Indebtedness Entitled to Rely.
The holders of Senior Indebtedness shall have the right to rely upon this Article XII, and no amendment or modification of the provisions contained herein shall diminish the rights of such holders unless such holders shall have agreed in writing thereto.
Signature page follows.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed and attested, all as of the day and year first above written.
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COBIZ FINANCIAL INC.
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By:
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Name:
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Title:
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[Signature Page to Indenture]
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U.S. BANK NATIONAL ASSOCIATION,
as Trustee
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By:
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Name:
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Title:
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[Signature Page to Indenture]
Exhibit 4.2
COBIZ FINANCIAL INC.
and
U.S. BANK NATIONAL ASSOCIATION
as Trustee
FIRST SUPPLEMENTAL INDENTURE
Dated as of June 25, 2015
to
INDENTURE
Dated as of June 25, 2015
5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030
THIS FIRST SUPPLEMENTAL INDENTURE (this “
First Supplemental Indenture
”), dated as of June 25, 2015, between COBIZ FINANCIAL INC., a corporation duly organized and existing under the laws of the State of Colorado (the “
Company
”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organized and existing under the laws of the United States, as Trustee (the “
Trustee
”), under the Base Indenture (as hereinafter defined).
RECITALS
WHEREAS, the Company and the Trustee have heretofore executed and delivered the Indenture, dated as of June 25, 2015 (the “
Base Indenture
” and, as hereby supplemented and amended, the “
Indenture
”), providing for the establishment from time to time of Series of the Company’s subordinated unsecured debt securities, which may be debentures, notes or other debt instruments of the Company created pursuant to Sections 2.1 and 2.2 of the Base Indenture (hereinafter called the “
Securities
”) and the issuance from time to time of Securities under the Indenture;
WHEREAS, Section 9.1(e) of the Base Indenture provides that the Company and the Trustee may enter into a supplemental indenture to the Base Indenture to issue and establish Securities of a Series thereunder and the form and terms and conditions of Securities of such Series as permitted by Section 2.1 and Section 2.2 of the Base Indenture;
WHEREAS, pursuant to Section 2.1 and 2.2 of the Base Indenture, the Company desires to issue new Securities of a Series under the Indenture to be known as its “5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030” (the “
Notes
”) and to establish the form and terms and conditions of the Notes, as provided in this First Supplemental Indenture and to provide for the initial issuance of Notes in the aggregate principal amount of $60,000,000; and
WHEREAS, the Company has requested that the Trustee execute and deliver this First Supplemental Indenture; and all requirements necessary to make (i) this First Supplemental Indenture a valid, binding and enforceable instrument in accordance with its terms, and (ii) the Notes, when executed by the Company and authenticated and delivered by the Trustee in accordance with the Indenture, the valid, binding and enforceable obligations of the Company, have been satisfied; and the execution and delivery of this First Supplemental Indenture has been duly authorized in all respects.
NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1. Relation to Base Indenture.
This First Supplemental Indenture constitutes an integral part of the Base Indenture.
Section 1.2. Definition of Terms.
For all purposes of this First Supplemental Indenture:
(a)
Capitalized terms used herein without definition shall have the meanings set forth in the Base Indenture,
provided
that if the definition of a capitalized term defined in this First Supplemental Indenture conflicts with the definition of that capitalized term in the Base Indenture, the definition of that capitalized term in this First Supplemental Indenture shall control for purposes of this First Supplemental Indenture and the Notes;
(b)
a term defined anywhere in this First Supplemental Indenture has the same meaning throughout;
(c)
the singular includes the plural and vice versa;
(d)
headings are for convenience of reference only and do not affect interpretation;
(e)
unless otherwise specified or unless the context requires otherwise, (i) all references in this First Supplemental Indenture to Sections refer to the corresponding Sections of this First Supplemental Indenture and (ii) the terms “herein”, “hereof”, “hereunder” and any other word of similar import refer to this First Supplemental Indenture; and
(f)
for purposes of this First Supplemental Indenture and the Notes, the following terms have the meanings given to them in this Section 1.2(f):
“
1940 Act Event
” means if the Company is required to register as an investment company pursuant to the Investment Company Act of 1940, as amended.
“
Business Day
” means any day except a Saturday, Sunday or legal holiday in the City of New York on which banking institutions are authorized or required by law, regulation or executive order to close; provided, however, that in the case of any Floating Rate Interest Payment Date, such day is also a London Banking Day.
“
DTC
” has the meaning set forth in Section 2.3 hereof.
“
Designated LIBOR Page
” means the display on Reuters or any successor service, on page LIBOR01, or any other page as may replace that page on the service, for the purpose of displaying the London interbank rates of U.S. dollars.
“
Federal Reserve Board”
means the Board of Governors of the Federal Reserve System or any successor regulatory authority with jurisdiction over bank holding companies.
“
Fixed Rate Interest Payment Date
” has the meaning set forth in Section 2.5(b)(i) hereof.
“
Fixed Rate Interest Record Date
” means, with respect to each Fixed Rate Interest Payment Date, June 15 or December 15 (whether or not a Business Day) immediately preceding such Fixed Rate Interest Payment Date, through June 25, 2025.
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“
Fixed Rate Period
” has the meaning set forth in Section 2.5(b)(i) hereof.
“
Floating Rate Interest Payment Date
” has the meaning set forth in Section 2.5(b)(ii) hereof.
“
Floating Rate Interest Record Date
” means, with respect to each Floating Rate Interest Payment Date, the fifteenth calendar day (whether or not a Business Day) immediately preceding such Floating Rate Interest Payment Date.
“
Floating Rate Period
” has the meaning set forth in section 2.5(b)(ii) hereof.
“
Global Note
” is a Global Security and has the meaning set forth in Section 2.4 hereof.
“
Independent Bank Regulatory Counsel
” means a law firm, a member of a law firm or an independent practitioner that is experienced in matters of federal bank holding company and banking regulatory law, including the laws, rules and the guidelines of the Federal Reserve Board relating to regulatory capital, and shall include any person who, under the standards of professional conduct then prevailing and applicable to such counsel, would not have a conflict of interest in representing the Company or the Trustee in connection with providing the legal opinion contemplated by the definition of the term “Tier 2 Capital Event.”
“
Independent Tax Counsel
” means a law firm, a member of a law firm or an independent practitioner that is experienced in matters of federal income taxation law, including the deductibility of interest payments made with respect to corporate debt instruments, and shall include any person who, under the standards of professional conduct then prevailing and applicable to such counsel, would not have a conflict of interest in representing the Company or the Trustee in connection with providing the legal opinion contemplated by the definition of the term “Tax Event.”
“
Interest Payment Date
” has the meaning set forth in Section 2.5(b)(ii) hereof.
“
London Banking Day
” means any date on which commercial banks are open for business (including dealings in U.S. dollars) in London.
“
Stated Maturity Date
” has the meaning set forth in Section 2.2 hereof.
“
Tax Event
” means the receipt by the Company of an opinion of Independent Tax Counsel to the effect that, as a result of:
a.
any amendment to or change (including any announced prospective amendment or change) in any law or treaty, or any regulation thereunder, of the United States or any of its political subdivisions or taxing authorities;
b.
any judicial decision, administrative action, official administrative pronouncement, ruling, regulatory procedure, regulation, notice or announcement, including any notice or announcement of intent to adopt or promulgate any ruling, regulatory procedure or regulation (any of the foregoing, an “administrative or judicial action”);
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c.
any amendment to or change in any official position with respect to, or any interpretation of, an administrative or judicial action or a law or regulation of the United States that differs from the previously generally accepted position or interpretation; or
d.
a threatened challenge asserted in writing in connection with an audit of the Company’s federal income tax returns or positions or a similar audit of any of its Subsidiaries, or a publicly known threatened challenge asserted in writing against any other taxpayer that has raised capital through the issuance of securities that are substantially similar to the Notes,
in each case, occurring or becoming publicly known on or after the original issue date of the Notes, there is more than an insubstantial risk that interest payable by the Company on the Notes is not, or, within 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.
“
Three-month LIBOR
” means, as determined on the second London Banking Day immediately preceding the commencement of the applicable Floating Rate Period (the “
Determination Date
”), the offered rate for deposits in U.S. dollars having a maturity of three months that appears on the Designated LIBOR Page as of 11:00 a.m., London time, on such determination date. If such rate does not appear on the Designated LIBOR Page at such time, then the Company will request the principal London office of each of four major reference banks in the London interbank market, selected by the Company, to provide such bank’s offered quotation to prime banks in the London interbank market for deposits in U.S. dollars with a term of three months as of 11:00 a.m., London time, on such determination date and in a principal amount equal to an amount that, in the judgment of the Company, is representative for a single transaction in U.S. dollars in the relevant market at the relevant time (a “
representative amount
”). If at least two such quotations are so provided, three-month LIBOR for such Floating Rate Period will be the arithmetic mean of such quotations. If fewer than two such quotations are provided, the Company will request each of three major banks in the City of New York to provide such bank’s rate for loans in U.S. dollars to leading European banks with a term of three months as of approximately 11:00 a.m., the City of New York time, on such determination date and in a representative amount. If at least two such rates are so provided, three-month LIBOR for such Floating Rate Period will be the arithmetic mean of such quotations. If fewer than two such rates are so provided, then three month LIBOR for such Floating Rate Period will be set to equal the three-month LIBOR for the then current Floating Rate Period or, in the case of the first Floating Rate Period, 2.455%.
“
Tier 2 Capital Event
” shall mean the receipt by the Company of an opinion of Independent Bank Regulatory Counsel to the effect that, as a result of:
a.
any amendment to, or change (including any announced prospective change) in, the laws or any regulations thereunder of the United States or any rules, guidelines or policies of an applicable regulatory authority for the Company; or
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b.
any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or which pronouncement or decision is announced on or after the original issue date of the Notes, the Notes do not constitute, or within 90 days of the date of such opinion will not constitute, Tier 2 capital (or its then equivalent if the Company were subject to such capital requirement) for purposes of capital adequacy guidelines of the Federal Reserve Board, as then in effect and applicable to the Company.
The terms “
Company
,” “
Trustee
,” “
Base Indenture
,” “
First Supplemental Indenture
,” “
Indenture
” and “
Notes
” shall have the respective meanings set forth in the recitals to this First Supplemental Indenture and the paragraph preceding such recitals.
ARTICLE 2
ESTABLISHMENT OF THE NOTES AND
GENERAL TERMS AND CONDITIONS OF THE NOTES
Section 2.1. Establishment of the Series of the Notes and Designation
. There is hereby authorized and established a Series of Securities designated as the “5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030.” The Securities that are a part of such Series shall be in the form and have the terms, provisions and conditions as set forth in the Base Indenture, this First Supplemental Indenture and the Notes in the form attached hereto as
Exhibit A.
Section 2.2. Payment of Principal; Issue Price
. Except as otherwise contemplated by this First Supplemental Indenture, the date upon which the entire principal amount of the Notes shall become due and payable, together with any accrued and unpaid interest then owing, shall be June 25, 2030 (the “
Stated Maturity Date
”). The Notes issued on the date hereof will be issued at a price equal to 100% of the principal amount thereof.
Section 2.3. Form, Payment and Appointment.
Except as provided in Section 2.14.2 of the Base Indenture, the Notes will be issued only in book-entry form, will be represented by one or more Global Notes (as defined below) registered in the name of or held by The Depository Trust Company (and any successor thereto) (“
DTC
”) or its nominee. So long as DTC is the registered owner of Global Notes, DTC or its nominee, as the case may be, will be considered the Holder of the Notes represented by such Global Notes for all purposes under the Indenture. The Company will make payments of principal of, and premium, if any, and interest on the Global Notes to DTC or its nominee, as the case may be, as the registered Holder of the Notes. The principal of any certificated Notes will be payable at the place of payment set forth below.
The Notes shall have such other terms as are set forth herein and in the form thereof attached hereto as
Exhibit A.
The Registrar, authenticating agent, Paying Agent and Service Agent for the Notes shall initially be the Trustee.
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The place of payment for the Notes shall be an office or agency of the Company maintained for such purpose, which shall initially be the Corporate Trust Office of the Trustee in Boston, Massachusetts.
The Notes will be issuable and may be transferred only in minimum denominations of $2,000 and any integral multiples of $1,000 in excess thereof. The amounts payable with respect to the Notes shall be payable in Dollars.
Section 2.4. Global Note.
The Notes shall be issued initially in the form of one or more fully registered global notes (each such global note, a “
Global Note
”) registered in the name of DTC or its nominee and deposited with DTC or its designated custodian or such other Depositary as any officer of the Company may from time to time designate. Unless and until a Global Note is exchanged for Notes in certificated form, such Global Note may be transferred, in whole but not in part, and any payments on the Notes shall be made, only to DTC or a nominee of DTC, or to a successor Depositary selected or approved by the Company or to a nominee of such successor Depositary as provided in the Indenture.
Section 2.5. Interest
.
(a)
Interest payable on any Interest Payment Date, the Stated Maturity Date or the redemption date, if any, with respect to the Notes shall be the amount of interest accrued from, and including, the immediately preceding Interest Payment Date in respect of which interest has been paid or duly provided for (or from and including the original issue date of Notes if no interest has previously been paid or duly provided for with respect to the Notes) to, but excluding, such Interest Payment Date, Stated Maturity Date or the redemption date, if any, as the case may be.
(b)
(i) From, and including, the original issue date of the Notes to, but excluding, June 25, 2025, unless redeemed prior to such date pursuant to Section 3.1 hereof, the Notes will bear interest at the annual rate of 5.625%, computed on the basis of a 360-day year consisting of twelve 30-day months, and payable semi-annually in arrears on each June 25 and December 25, beginning on December 25, 2015 and ending on June 25, 2025 (each such payment date, a “
Fixed Rate Interest Payment Date
,” with the period from, and including, the original issue date of the Notes to, but excluding, the first Fixed Rate Interest Payment Date and each successive period from, and including, a Fixed Rate Interest Payment Date to, but excluding, the next Fixed Rate Interest Payment Date being a “
Fixed Rate Period
”). In the event that any scheduled Fixed Rate Interest Payment Date for the Notes falls on a day that is not a Business Day, then payment of interest payable on such Fixed Rate Interest Payment Date will be postponed to the next succeeding day which is a Business Day (and no interest on such payment will accrue for the period from and after such scheduled Fixed Rate Interest Payment Date).
(ii) From, and including June 25, 2025 to, but excluding, the Stated Maturity Date, unless redeemed subsequent to June 25, 2025 but prior to the Stated
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Maturity Date pursuant to Section 3.1 hereof, the Notes will bear interest at an annual rate equal to Three-month LIBOR, reset quarterly, plus 317 basis points (3.17%), payable quarterly in arrears on each March 25, June 25, September 25 and December 25, beginning on June 25, 2025 (each such payment date, a “
Floating Rate Interest Payment Date
,” and, together with the Fixed Rate Interest Payment Dates, collectively the “
Interest Payment Dates
,” with the period from, and including, June 25, 2025 to, but excluding, the first Floating Rate Interest Payment Date and each successive period from, and including, a Floating Rate Interest Payment Date to, but excluding, the next Floating Rate Interest Payment Date being a “
Floating Rate Period
”). Interest payable on the Notes for a Floating Rate Period shall be computed on the basis of a 360-day year and the actual number of days in such Floating Rate Period. All percentages used in or resulting from any calculation of Three-month LIBOR shall be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point, with 0.000005% rounded up to 0.00001%. In the event that any scheduled Floating Rate Interest Payment Date for the Notes falls on a day that is not a Business Day, then payment of interest payable on such Floating Rate Interest Payment Date will be postponed to the next succeeding day which is a Business Day unless such day falls in the next succeeding calendar month, in which case such Floating Rate Interest Payment Date will be accelerated to the immediately preceding day that is a Business Day, and, in each such case, the amounts payable on such Business Day will include interest accrued to, but excluding, such Business Day.
(c)
Interest due on the Stated Maturity Date (whether or not an Interest Payment Date) of the Notes will be paid to the Person to whom principal of the Notes is payable.
Section 2.6. Subordination.
The Company, for itself, its successors and assigns, covenants and agrees, and each Holder of Notes by the Holder’s acceptance thereof, likewise covenants and agrees, that the payment of the principal of, premium, if any, and interest on each and all of the Notes is and will be expressly subordinated and subject in right of payment to the prior payment in full of all Senior Indebtedness, to the extent and in the manner described in Article XII of the Base Indenture.
Section 2.7. Events of Default; Acceleration.
Neither the Trustee nor the Holders of the Notes shall have the right to accelerate the maturity of the Notes in the absence of an Event of Default specified under clause (e) or (f) of Section 6.1 of the Base Indenture. If an Event of Default specified in clause (e) or (f) of Section 6.1 of the Base Indenture occurs, then the principal amount of all of the outstanding Notes, including any accrued and unpaid interest on the Notes and premium, if any, shall become and be immediately due and payable without any declaration or other act on the part of the Trustee or the Holders of the Notes in accordance with the provisions of Section 6.2 of the Base Indenture.
Section 2.8. No Sinking Fund.
The Notes are not entitled to the benefit of any sinking fund.
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Section 2.9. No Conversion or Exchange Rights.
The Notes shall not be convertible into or exchangeable for any other securities or property of the Company or any Subsidiary of the Company.
ARTICLE 3
REDEMPTION OF THE NOTES
Section 3.1. Redemption.
The Company may, at its option, redeem the Notes, in whole or in part, on any Interest Payment Date on or after June 25, 2025. The Company may also, at its option, redeem the Notes before the Stated Maturity Date in whole, but not in part, at any time, upon the occurrence of a Tier 2 Capital Event, Tax Event or 1940 Act Event. Any such redemption will be at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date fixed by the Company; provided that, for avoidance of doubt, the payment of such accrued and unpaid interest paid as a part of the redemption price shall satisfy in full the obligation of the Company to pay accrued and unpaid interest on the Notes redeemed from and including the most recent Interest Payment Date on which all accrued and unpaid interest on the Notes was paid or provided for through, but excluding, the redemption date. No such redemption of the Notes by the Company prior to the Stated Maturity Date shall be made without the prior approval of the Federal Reserve Board if such prior approval is or will be required at the scheduled redemption date. The provisions of Article III of the Base Indenture shall apply to any redemption of the Notes pursuant to this Article 3.
ARTICLE 4
FORM OF NOTES
Section 4.1. Notes
. The Notes and the Trustee’s Certificate of Authentication thereon are to be substantially in the form attached as
Exhibit A
hereto, with such changes therein as the officers of the Company executing the Notes (by manual or facsimile signature) may approve, such approval to be conclusively evidenced by their execution thereof.
ARTICLE 5
ISSUE OF NOTES
Section 5.1. Original Issue of Notes.
Notes having an aggregate principal amount of $60,000,000 may from time to time, upon execution of this First Supplemental Indenture, be executed by the Company and delivered to the Trustee for authentication, and the Trustee shall thereupon authenticate and deliver said Notes in accordance with a Company Order pursuant to Section 2.3 of the Base Indenture without any further action by the Company (other than as required by the Base Indenture).
Section 5.2. Additional Issues of Notes
. The Company may from time to time, without notice to or the consent of the Holders of the Notes, issue an unlimited amount of additional Notes, which Securities will rank
pari passu
with the Notes and be identical in all respects as the Notes previously issued except for their issuance date, the offering price, the interest commencement date and the first payment of interest following the issue date of such additional Notes in order that such additional Notes may be consolidated and form a single Series with the
8
Notes outstanding immediately prior to the issuance of such additional Notes and have the same terms as to status, redemption or otherwise as the Notes; provided, that if any additional Notes are not fungible with the initial Notes for U.S. income tax purposes, such additional Notes will have a separate CUSIP number.
ARTICLE 6
IMMUNITY OF STOCKHOLDERS, EMPLOYEES, AGENTS, OFFICERS AND DIRECTORS
Section 6.1. Indenture and Notes Solely Corporate Obligations.
No director, officer, employee nor shareholder, as such, of the Company shall have any liability for any obligations of the Company under the Notes or this First Supplemental Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Holder by accepting the Notes waives and releases all such liability.
ARTICLE 7
MISCELLANEOUS
Section 7.1. Ratification of Base Indenture.
The Base Indenture, as supplemented by this First Supplemental Indenture, is in all respects ratified and confirmed, and this First Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided.
Section 7.2. Trustee Not Responsible for Recitals.
The recitals contained herein and in the Notes, except the Trustee’s certificates of authentication, shall be taken as statements of the Company and not those of the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representations as to the validity or sufficiency of this First Supplemental Indenture or of the Notes. The Trustee shall not be accountable for the use or application by the Company of the Notes or of the proceeds thereof.
Section 7.3. New York Law To Govern.
THIS FIRST SUPPLEMENTAL INDENTURE AND EACH NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 7.4. Severability.
In case any provision in this First Supplemental Indenture or in the Notes 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
Section 7.5. Counterparts.
This First Supplemental Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. The exchange of copies of this First Supplemental Indenture and of signature pages by facsimile or electronic format (i.e., “.pdf” or “.tif”) transmission shall constitute effective execution and delivery of this First Supplemental Indenture as to the parties hereto and may be used in lieu of the original First Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or electronic format (i.e., “.pdf” or “.tif”) shall be deemed to be their original signatures for all purposes.
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Section 7.6. Benefits of First Supplemental Indenture.
Nothing in this First Supplemental Indenture or in the Notes, express or implied, shall give to any Person, other than the parties to this First Supplemental Indenture and their successors under this First Supplemental Indenture and the Persons in whose names the Notes are registered from time to time, any benefit or any legal or equitable right, remedy or claim under this First Supplemental Indenture.
Section 7.7. Conflict with Base Indenture.
If any provision of this First Supplemental Indenture relating to the Notes is inconsistent with any provision of the Base Indenture, such provision of this First Supplemental Indenture shall control.
Section 7.8. Provisions of Trust Indenture Act Controlling.
This First Supplemental Indenture is subject to the provisions of the Trust Indenture Act that are required to be part of the Indenture and shall, to the extent applicable, be governed by such provisions. If any provision of this First Supplemental Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this First Supplemental Indenture by the Trust Indenture Act, such required or deemed provision shall control.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK.]
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IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed as of the day and year first written above.
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COBIZ FINANCIAL INC.
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By:
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Name:
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Title:
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U.S. BANK NATIONAL ASSOCIATION
, as Trustee
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By:
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Name:
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EXHIBIT A
[Note: The following legend is to be placed at the beginning of any Global Note representing Notes.]
GLOBAL NOTE
THIS SECURITY AND THE OBLIGATIONS OF THE COMPANY (AS DEFINED HEREIN) AS EVIDENCED HEREBY (1) ARE NOT DEPOSITS WITH OR HELD BY THE COMPANY AND ARE NOT INSURED OR GUARANTEED BY ANY FEDERAL AGENCY OR INSTRUMENTALITY, INCLUDING, WITHOUT LIMITATION, THE FEDERAL DEPOSIT INSURANCE CORPORATION AND (2) ARE SUBORDINATE IN THE RIGHT OF PAYMENT TO THE SENIOR INDEBTEDNESS (AS DEFINED IN THE INDENTURE IDENTIFIED HEREIN).
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE REFERRED TO IN THIS SECURITY AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR ITS NOMINEE. THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE OR A SUCCESSOR OF SUCH DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR AND NO SUCH TRANSFER MAY BE REGISTERED, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR OR IN LIEU OF, THIS SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN SUCH LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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COBIZ FINANCIAL INC.
5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030
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No.
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CUSIP: 190897 AA6
ISIN: US190897AA60
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$60,000,000 (SIXTY MILLION)
CoBiz Financial Inc., a Colorado corporation (hereinafter called the “
Company
”, which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or its registered assigns, the principal sum of $60,000,000 (or such other amount as set forth in the Schedule of Increases or Decreases in Note attached hereto) on June 25, 2030 (such date is hereinafter referred to as the “Stated Maturity Date”), unless redeemed prior to such date, and to pay interest thereon (i) from, and including, June 25, 2015, to, but excluding, June 25, 2025 or any early redemption date, at a rate of 5.625% per annum, semi-annually in arrears on June 25 and December 25 of each year (each such date, a “Fixed Rate Interest Payment Date”, with the period from, and including, June 25, 2015 to, but excluding, the first Fixed Rate Interest Payment Date and each successive period from, and including, a Fixed Rate Interest Payment Date to, but excluding, the next Fixed Rate Interest Payment Date being a “Fixed Rate Period”) and (ii) from, and including, June 25, 2025 to but excluding the Stated Maturity Date or any early redemption date, at a rate equal to Three-month LIBOR, reset quarterly, plus 317 basis points (3.17%), payable quarterly in arrears on March 25, June 25, September 25 and December 25 of each year through the Stated Maturity Date or earlier redemption date (each, a “Floating Rate Interest Payment Date,” and together with the Fixed Rate Interest Payment Dates, the “Interest Payment Dates,” with the period from, and including, June 25, 2025 to, but excluding, the first Floating Rate Interest Payment Date and each successive period from, and including a Floating Rate Interest Payment Date to, but excluding, the next Floating Rate Interest Payment Date being a “Floating Rate Period”). Interest payable on this Note during any Fixed Rate Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months. In the event that any scheduled Fixed Rate Interest Payment date on this Note falls on a day that is not a Business Day (as defined in the Indenture), then payment of interest payable on such Fixed Rate Interest Payment Date will be postponed to the next succeeding day which is a Business Day. Interest payable on this Note during any Floating Rate Period shall be computed on the basis of a 30-day year and the actual number of days in such Floating Rate Period. All percentages used in or resulting from any calculation of three-month LIBOR shall be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point, with 0.000005% rounded up to 0.00001%. In the event that any scheduled Floating Rate Interest Payment Date on this Note falls on a day that is not a Business Day, then payment of interest payable on such Floating Rate Interest Payment Date will be postponed to the next succeeding day which is a Business Day, unless such day falls in the next succeeding calendar month, in which case such Floating Rate Interest Payment Date will be accelerated to the immediately preceding day that is a Business Day, and, in each case, the amounts payable on such Business Day will include interest accrued to, but excluding, such Business Day.
Any principal and premium, and any such installment of interest, which is overdue shall bear interest at the applicable rate set forth in the previous paragraph (to the extent that the
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payment of such interest shall be legally enforceable), 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 interest so payable, and punctually paid or duly provided for, on any Fixed Rate Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Note is registered at the close of business on the Fixed Rate Interest Record Date for such interest, which shall be the June 15 or December 15 (whether or not a Business Day) immediately preceding such Fixed Rate Interest Payment Date, through June 25, 2025, and thereafter, on any Floating Rate Interest Payment Date, on the Fixed Rate Interest Record Date for such interest, which shall be the fifteenth calendar date (whether or not a Business Day) immediately preceding such Floating Rate Interest Payment Date.
Payment of the principal of and interest on this Note will be made at the office or agency of the Company maintained for that purpose, which shall initially be the Corporate Trust Office of the Trustee, 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.
Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer.
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COBIZ FINANCIAL INC.
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By:
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TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the Series designated therein referred to in the within-mentioned Indenture.
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Dated:
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U.S. BANK NATIONAL ASSOCIATION, as Trustee
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By:
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Authorized Signatory
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REVERSE OF NOTE
COBIZ FINANCIAL INC.
5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030
This Note is one of a duly authorized issue of Securities of the Company of a Series designated as the “5.625% Fixed to Floating Rate Subordinated Notes due June 25, 2030” (herein called the “
Notes
”) initially issued in an aggregate principal amount of $60,000,000 on June 25, 2015. Such Series of Securities has been established pursuant to, and is one of an indefinite number of Series of subordinated debt securities of the Company issued or issuable under and pursuant to, the Indenture, dated as of June 25, 2015 (the “
Base Indenture
”), between the Company and U.S. Bank National Association, as Trustee (herein called the “
Trustee
,” which term includes any successor trustee), as supplemented and amended by the First Supplemental Indenture between the Company and the Trustee, dated as of June 25, 2015, (the “
First Supplemental Indenture
,” and the Base Indenture as supplemented and amended by the First Supplemental Indenture, the “
Indenture
”), to which Indenture and any other 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 and the Persons in whose names Notes are registered from time to time and of the terms upon which the Notes are, and are to be, authenticated and delivered. The terms, conditions and provisions of the Notes are those stated in the Indenture, those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), and those set forth in this Note. To the extent that the terms, conditions and provisions of this Note modify, supplement or are inconsistent with those of the Indenture, then the terms, conditions and other provisions of this Note shall govern to the extent such terms, conditions and other provisions of this Note are not inconsistent with the terms, conditions and provisions made part of the Indenture by reference to the Trust Indenture Act.
All capitalized terms used in this Note and not defined herein that are defined in the Base Indenture or the First Supplemental Indenture shall have the meanings assigned to them in the Base Indenture or the First Supplemental Indenture. If any capitalized term used in this Note and defined herein is also defined in the Base Indenture or the First Supplemental Indenture, in the event of any conflict in the meanings ascribed to such capitalized term, the definition of the capitalized term in this Note shall control.
The indebtedness of the Company evidenced by the Notes, including the principal thereof, premium, if any, and interest thereon, is, to the extent and in the manner set forth in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness (as defined in the Indenture), whether outstanding at the date hereof or hereafter incurred, and on the terms and subject to the terms and conditions as provided and set forth in the Indenture, and shall rank
pari passu
in right of payment with all other Securities and with all other unsecured subordinated indebtedness of the Company and not by its terms subordinate and subject in right of payment to the prior payment in full of debentures, notes or other debt instruments of types that include the Notes. Each Holder of this Note, by the acceptance hereof, agrees to and shall be bound by such provisions of the Indenture and authorizes and directs the
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Trustee on his behalf to take such actions as may be necessary or appropriate to effectuate the subordination so provided.
The Notes are intended to be treated as Tier 2 capital (or its then equivalent if the Company were subject to such capital requirement) for purposes of capital adequacy guidelines of the Board of Governors of the Federal Reserve System (or any successor regulatory authority with jurisdiction over bank holding companies) (the “Federal Reserve Board”) as then in effect and applicable to the Company. If an Event of Default with respect to Notes shall occur and be continuing, the principal and interest owed on the Notes shall only become due and payable in accordance with the terms and conditions set forth in Article VI of the Base Indenture and Section 2.7 of the First Supplemental Indenture.
Accordingly, the Holder of this Note has no right to accelerate the maturity of this Note in the event the Company fails to pay interest on any of the Notes, or fails to perform any other obligations under the Notes or in the Indenture that are applicable to the Notes.
The Company may, at its option, redeem the Notes, in whole or in part, on any Interest Payment Date on or after June 25, 2025. The Company may also, at its option, redeem the Notes before the Stated Maturity Date, in whole, but not in part, at any time, upon the occurrence of a Tier 2 Capital Event, a Tax Event or a 1940 Act Event. Any such redemption will be at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date fixed by the Company. No such redemption of the Notes by the Company prior to the Stated Maturity Date shall be made without the prior approval of the Federal Reserve Board if such prior approval is or will be required at the scheduled redemption date.
The Notes are not entitled to the benefit of any sinking fund. The Notes are not convertible into or exchangeable for any other securities or property of the Company or any Subsidiary of the Company.
The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes at any time by the Company and the Trustee with the consent of the Holders of at least a majority in principal amount of the Notes. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes at the time outstanding, on behalf of the Holders of all Notes, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note 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 Note.
As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the register described in Section 2.4 of the Base Indenture, upon surrender of this Note for registration of transfer at the office or agency of the Company in any place where the principal of and interest on this Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the
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Registrar duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.
The Notes are issuable only in registered form without coupons in minimum denominations of $2,000 and any integral multiples of $1,000 in excess thereof.
The Company and the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note is overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.
[Note: The provisions below that appear in brackets will be inserted into any Global Note representing Notes.] [This Security is a global note, represented by one or more permanent global certificates registered in the name of the nominee of The Depository Trust Company (each a “Global Note” and collectively, the “Global Notes”). Accordingly, unless and until it is exchanged for individual certificates, this Note may not be transferred except as a whole by The Depository Trust Company (the “Depositary”) to a nominee of such Depositary or by a nominee of such Depositary or by the Depositary or any nominee to a successor Depositary or any nominee of such successor. Ownership of beneficial interests in this Security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the applicable Depositary or its nominee (with respect to interest of persons that have accounts with the Depositary (“Participants”) and the records of Participants (with respect to interests of persons other than Participants)). Beneficial interests in Notes owned by persons that hold through Participants will be evidenced only by, and transfers of such beneficial interests with such Participants will be effected only through, records maintained by such Participants. Except as provided below, owners of beneficial interests in this Note will not be entitled to have any individual certificates and will not be considered the owners or Holders thereof under the Indenture.
Except in the limited circumstances set forth in the Base Indenture, Participants and owners of beneficial interests in the Global Notes will not be entitled to receive Notes in definitive form and will not be considered Holders of Notes. Neither the Company nor the principal Paying Agent will be liable for any delay by the Depositary, its nominee or any direct or indirect participant in identifying the beneficial owners of the related Notes. The Company and the principal payment agent may conclusively rely on, and will be protected in relying on, instructions from the Depositary or its nominee for all purposes, including with respect to the registration and delivery, and the respective principal amounts, of the Notes to be issued.
Except as provided in Section 2.7 of the Base Indenture, beneficial owners of Global Notes will not be entitled to receive physical delivery of Notes in definitive form and no Global Note will be exchangeable except for another Global Note of like denomination and tenor to be registered in the name of the Depositary or its nominee. Accordingly, each
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person owning a beneficial interest in a Global Note must rely on the procedures of the Depositary and, if such person is not a Participant, on the procedures of the Participant through which such person owns its interest, to exercise any rights of a Holder under the Notes.
The laws of some jurisdictions may require that certain purchasers of securities take physical delivery of those securities in definitive form. Accordingly, the ability to transfer interests in the Notes represented by a Global Note to those persons may be limited. In addition, because the Depositary can act only on behalf of its Participants, who in turn act on behalf of persons who hold interests through Participants, the ability of a person having an interest in Notes represented by a Global Note to pledge or transfer such interest to persons or entities that do not participate in the Depositary’s system, or otherwise to take actions in respect of such interest, may be affected by the lack of a physical definitive security in respect of such interest. None of the Company, the Trustee, the Paying Agent and the Registrar will have any responsibility or liability for any aspect of the records relating to or payments made on account of Notes by the Depositary, or for maintaining, supervising or reviewing any records of the Depositary relating to the Notes.]
U.S. Bank National Association will act as the Company’s principal Paying Agent with respect to the Notes through its Corporate Trust Office presently located at One Federal Street, 3
rd
Floor, Boston, Massachusetts 02110. The Company may at any time rescind the designation of a Paying Agent, appoint a successor Paying Agent, or approve a change in the office through which any Paying Agent acts.
Notices to the Holders of registered Notes will be given to such Holders at their respective addresses in the register and will be deemed to have been given on the fourth weekday (being a day other than Saturday or Sunday) after the date of mailing, or in the case of Global Notes, electronic delivery in accordance with DTC’s applicable procedures. The Indenture contains provisions setting forth certain conditions to the institution of proceedings by the Holders of Notes with respect to the Indenture or for any remedy under the Indenture.
THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK.
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ASSIGNMENT FORM
To assign the within Security, fill in the form below: I or we assign and transfer the within Security to:
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(Insert assignee’s legal name)
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(Insert assignee’s social security or tax I.D. no.)
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(Print or type assignee’s name, address and zip code)
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and irrevocably appoint as agent to transfer this Security on the books of CoBiz Financial Inc. The agent may substitute another to act for it.
Your Signature:
(Sign exactly as your name appears on the other side of this Security)
Your Name:
Date:
Signature Guarantee:
SIGNATURE GUARANTEE
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“
STAMP
”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
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SCHEDULE OF INCREASES OR DECREASES IN NOTE
The initial principal amount of this Note is $60,000,000. The following increases or decreases in the principal amount of this Note have been made:
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Amount of
decrease in
principal amount
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Principal amount
of this Note
following such
decrease or
increase
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Signature of
authorized
signatory of
Trustee
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